I received an email the other day from a co-alum on our 10th MBA class reunion and couldn’t believe 10 years have flown by. That said, I decided to do this blog post on the analysis of getting an MBA. As with everything serious in life, getting an MBA takes preparation, the desire to get it and the mental acuity to go through with the rigors of the program.
The first question to ask is why do you want an MBA? If you find yourself wanting in the response, then maybe you need to have a re-think about your motivations. As is common knowledge, getting an MBA is no small investment. Let’s run down the ‘cost’ spectrum of this analysis before discussing the ‘benefit’ aspect of the analysis.
Costs (monetary and non-monetary):
- Financial cost of obtaining an MBA from a top-notch / Ivy League school is easily north of $100,000 (for tuition, books and related). When you add other costs such as living expenses and the opportunity cost of not earning a salary for the period, it’s easily a steep price tag of $200,000. Obtaining a scholarship or fellowship can help alleviate this cost. Others finance it with savings and/or student loans.
- Sweat and blood: a top-notch MBA program is no easy feat and definitely not for the lazy. It requires solid time management as well as the ability to be on top of course work, projects, team building activities and assignments and active participation in class. It is not uncommon for professors to ‘cold call’ participants during class sessions / discussions. Let us just say the ‘skiving’ or ‘barest minimum’ attitude some undergraduates displayed in their undergraduate days will NOT fly in an MBA program.
Benefits (monetary and non-monetary):
- Enhancing career path: earning an MBA enhances one’s career progression and may help to land a high-paying job or a highly sought-after role, either immediately post MBA or after a few years post MBA. It is not uncommon for candidates to change career paths post MBA, in short, this is one of the reasons people go for an MBA. Typical careers post MBA are in the field of management consulting, investment banking, structured financing and general management; all of which are known to pay top dollars in salaries.
- Expanded knowledge base: MBA programs bring together people with varied professional, cultural and educational backgrounds in one spot, an opportunity you may not necessarily have in your current work environment. The classroom and off-classroom exchanges and interactions provide the opportunity to broaden your horizon, learn different perspective of business / management challenges as well as appreciate varied viewpoints on how to tackle a problem.
- Professional networking opportunities: Spending a dedicated period of time in an MBA program affords you the opportunity to build lasting relationships with your classmates that could provide a platform for business opportunities and lifetime connections. There are definitely several situations where business enterprises are formed post MBA by 2 or more participants from an MBA class. This is intuitive given that a lot of business ideas and knowledge are shared during class participation and interactions outside of the class room.
Getting an MBA is well worth the investment (using a payback period of 3 – 5 years) if and only if you are committed, focused and have a well thought out plan post-MBA on your career path. What are your key motivations for getting an MBA? Have you done research on the school you wish to apply to? Are they Ivy League or 2nd tier universities? Have you reached out to a current MBA student for a chat about the program? Have you toured the school(s) of choice? Have you researched the criteria for admission including GMAT score requirements? Have you figured out how you will pay for the MBA and other living expenses while out of work i.e. loans, savings, scholarships, company sponsorship? Which MBA program is more suitable for your current status – traditional full-time, part-time, executive, 1-year intensive?
Do you have a well-thought out career path trajectory post MBA which will steer you toward which MBA program to apply for? For example, if you seek a career in investment banking, then schools like Kellogg School of Management, the Wharton School of Business, the Chicago Booth School of Business, UVA Darden School of Business and the like should be targeted. If you seek a career in leadership & entrepreneurship, the International Institute for Management Development (“IMD”) is a great choice. If you seek a career in general management, then schools like London School of Business, IMD or Harvard Business School should be the focus. In the final analysis, you have to do your homework as nothing good comes easy.
I would love to get comments from you on the above analysis i.e. do you agree with me & why or do you have alternate viewpoints? Kindly share your perspectives.