By Ilana Kowarski
U S News, May 10, 2018 —
An MBA is ideal for people who want to gain business skills and accelerate their careers.
College students and young professionals often wonder whether attending a top graduate business school will set them up for career success.
An MBA degree is a popular stepping stone to C-suite jobs at large corporations, and it is also an asset for budding entreprenuers. It’s a credential that appears on the resumes of numerous Fortune 500 executives, including Walmart CEO Doug McMillon, who earned his MBA at the University of Tulsa, and Facebook COO Sheryl Sandberg, an MBA alumna of Harvard Business School.
But while many prominent business executives hold an MBA, the degree isn’t a golden ticket to fame or fortune. According to MBA experts, excelling in business requires initiative, creativity and effort, regardless of someone’s academic pedigree.
“There’s nothing about getting an MBA that doesn’t require initiative from that point all the way through your career,” says Elissa Sangster, executive director of the Forté Foundation, a nonprofit organization focused on encouraging women to attend MBA programs and pursue ambitious career goals. Sangster says an MBA degree from a quality business school can help people break into certain highly competitive business sectors such as Silicon Valley tech companies or the Wall Street finance industry. She adds that prospective MBA students who have dreams of working in major cities far from home can often benefit from earning their MBA at a nonlocal school.
“When you think about business school, there are so many great choices that are going to require you to pack up your apartment or your home and move across the country,” she says. However, Sangster acknowledges that MBA hopefuls who have family commitments or want to stay at their current company may not want or need to attend a national B-school if that means moving across the country. She says career enhancers who are more focused on gaining skills than adding cachet to their resume can benefit from attending a regional B-school.
If you’re intrigued by the possibility of earning an MBA degree but wonder whether the degree is a good fit for you, here’s an outline of what you can expect to get out of an MBA program.
What “MBA” Stands For
MBA is the common abbreviation for a Master of Business Administration degree, and recipients of this degree typically stop attending school after receiving it.
However, those who are interested in conducting business research may elect to pursue a doctorate in business or management. Such students can earn either a Ph.D. or a Doctor of Business Administration degree, commonly known as a DBA.
How Long It Takes to Get an MBA
A full-time MBA program typically lasts two years, although there are many accelerated full-time MBA programs that only last a single year, especially at non-U.S. business schools, where this fast-paced type of MBA is common.
Part-time and executive MBA programs vary in length, depending on how many credits a student enrolls in each academic semester or quarter. Both executive and part-time MBA programs are designed for working professionals who are attending school while maintaining a full-time job.
MBA applications typically include standardized test scores, resumes, academic transcripts, essays and recommendation letters. Many B-schools will accept either GMAT or GRE test scores. However, there are a few test-optional MBA programs where applicants do not need to submit business school entrance exam scores. Additionally, some B-schools that ordinarily require test scores will waive that requirement for applicants who qualify for score waivers based on impressive work experience or a solid college GPA.
MBA admissions officers generally like to see evidence of career progression in an MBA application, meaning that the applicant gradually took on more professional responsibility. It’s also helpful if applicants have success stories about how they were able to contribute to their current company, past employers, college campus or local community, experts say.
Types of MBA Degrees
Anyone who is interested in an MBA should know there are multiple types of MBA programs to choose from, including full-time, part-time and executive MBA programs, says Rebecca Horan, a former admissions officer for the executive MBA program at New York University’s Stern School of Business. Each of these types of MBAs is appropriate for a different kind of student, she adds.
She says a full-time MBA program is an all-consuming educational experience that allows students to reset their career trajectories. “You can use it to accelerate your career and you can also use it to do a career switch, because it is such an intensive, all-in program,” she says.
That said, Horan says that for someone who is satisfied with their career path but wants to move up at their current company, a part-time program may be a better fit, especially if their company is willing to subsidize the cost of a part-time MBA program. Horan says someone who is happy with his current job may not want to leave that job to pursue a full-time MBA program.
Among full-time MBA programs, experts say there are two primary types MBA hopefuls should consider: a traditional two-year MBA program and an accelerated one-year program. One-year, full-time MBA programs typically cost less than two-year programs and require less time than traditional programs, but the speed of these programs means that students must carry a heavy academic workload, experts say.
MBA Concentrations and Specializations
MBA programs generally offer a range of concentrations or specializations that allow students to acquire expertise in a specific aspect of business, such as finance or technology.
Experts say MBA hopefuls should decide which topic to specialize in based on what skills would help them improve their work performance and which specialties are most likely to increase their job opportunities. MBA graduates with in-demand specializations are paid higher wages than their peers who focus on less marketable disciplines, experts say.
How to Prepare for an MBA
It’s important for aspiring students to figure out what their general career goals are before pursuing an MBA program so they can capitalize on their program’s on-campus recruitment opportunities, Horan says. She notes that MBA recruiters typically begin to visit business school campuses shortly after MBA programs start.
Sangster also says that it’s generally advisable for college students who know they are interested in business school to take the GMAT or GRE business school entrance exam as soon as possible. She says MBA hopefuls are likely to perform best on standardized tests while they are still students, as opposed to after they have spent years in the workforce.
The Average MBA Salary and Bonus
Starting salaries and bonuses vary greatly among MBA graduates, with alumni of highly ranked B-schools in the U.S. News 2019 Best Business Schools rankings earning much more than their peers who graduated from lower-ranked schools.
Among the 10 ranked B-schools where the average salary and bonus were highest, the overall average compensation was $161,566. By contrast, at the 10 ranked B-schools where the average salary and bonus were lowest, the overall average compensation was $58,390.
U.S News data shows that pay among MBA grads depends on which sector they enter. Those who work in the consulting sector are paid an average salary exceeding $130,000, while those who work at a nonprofit typically earn less. The average newly minted MBA who works at a nonprofit earns slightly more than $81,000.
The Cost of an MBA
Annual tuition for traditional full-time MBA students exceeded $50,000 at the top 15 ranked MBA programs in the 2019 Best Business Schools rankings, and at some schools, annual tuition costs exceeded $70,000.
Tuition prices are typically lower at public schools than private schools, especially for in-state students. Among the 10 highest-ranked public B-schools, the average in-state tuition for full-time MBA students was slightly more than $42,000 per year, according to U.S. News data. However, advertised MBA costs can be misleading, since many MBA students receive either merit scholarships or need-based financial aid.
Both partial and full-ride MBA scholarships exist, but many of these scholarships are extraordinarily competitive. Some MBA scholarships are reserved for specific populations within the MBA applicant pool, such as scholarships designated for women, ethnic minorities, active-duty military personnel and military veterans. But there are also MBA scholarships open to any MBA applicant, no matter their family background or profession.
What Skills an MBA Teaches
Business school professors say MBA programs help students develop the skills required to excel as business executives, such as the ability to quickly and accurately analyze large amounts of information and the ability to develop smart solutions to business problems. MBA programs also teach students how to inspire and motivate people and command respect, a skill which is vital for those who want to tackle ambitious business projects that require teamwork, MBA faculty say.
“An MBA degree is designed to teach everything needed to run your own business,” Michael Provitera, an MBA professor at Barry University, said via email. “However, the program caters to managers that want to become leaders and students aspiring to climb the corporate ladder.”
Phyllis Zimbler Miller, who received her MBA in finance from the Wharton School at the University of Pennsylvania in 1980, says she has greatly benefited from the lessons she learned in MBA courses decades ago. “And every day of my life since then I have used my graduate business education, which provides an effective mindset and framework for looking at situations and acting on these situations that is not provided in most undergraduate education,” she said via email.
What Classes Are Included in an MBA
An MBA typically includes courses in accounting, finance, marketing, organizational behavior, economics, management and business ethics.
Reeves says his MBA program, which he completed in 2013, offered him exposure to multiple aspects of business and didn’t pigeonhole him into a specific career track. Reeves adds that someone who wants to become a subject matter expert may be frustrated by the fact that an MBA covers so much material, but Reeves says the variety of courses in the MBA was a selling point for him. He says his MBA provided him with a big-picture understanding of business, which is useful to him as a CEO.
Horan says that a top-notch MBA program will not only offer theoretical lessons in how business works but also experiential learning opportunities where students do meaningful business projects for actual companies.
Horan, a brand strategist who earned her MBA at NYU, says that during her MBA program, she worked on a marketing campaign for a chocolate company that needed to increase sales during the slow summer months. She says projects like this help MBA students gain real-world skills.
When Combining an MBA With Another Grad Degree Makes Sense
According to MBA alumni, before pursuing an MBA and another degree simultaneously in a dual-degree or joint-degree program, MBA hopefuls should think seriously about whether they really need two graduate degrees. Experts warn that earning two degrees at once is both psychologically and financially taxing, so it’s not right for everybody, but it could be a good choice for people who have genuine interest in two programs and a serious plan about how they would use each of these degrees.
He adds that it’s important to ensure that you have a compelling reason to pursue a dual-degree program that explains why a single degree will not suffice.
Sangster says people contemplating a J.D.-MBA should know that business executives and business lawyers tend to have different mindsets. Corporate leaders typically are willing to take bold risks if those opportunities could result in hefty profits, she says. Meanwhile, corporate attorneys usually strive to minimize risks, since their job is to recognize the potential for legal harm and mitigate the possibility of legal penalties. For that reason, it can be hard to combine those two disciplines, Sangster says.
Decide for Yourself: Is an MBA Worth It?
Nirav Mehta, associate director for MBA admissions at the University of Southern California’s Marshall School of Business, says the greatest benefit of an MBA degree is the relationships students forge with their classmates and faculty.
“The MBA degree’s real value comes from membership in a lifelong learning community and access to the alumni network,” Mehta said via email. “The overall network serves an active source of personal and professional support. The connections that one makes through the MBA program can be life-changing, and these relationships help to facilitate career transitions long after graduation.”