Should I Get an MBA? What It Is and When It's Worth the EffortSeptember 22, 2020
Have you ever wondered if you should get an MBA? Choosing to start an MBA program is a life-changing decision with implications for your career aspirations, opportunities and finances. In this article, we discuss what an MBA is, examine the pros and cons of getting one and offer insight into how to determine if an MBA is right for you.
What is an MBA?
An MBA is a degree with business-related subjects, including economics, communication, accounting, management, statistics and entrepreneurship. MBA degrees prepare students for positions in different institutions.
Students can complete MBA studies part- or full-time. Often, a full-time commitment is best for new grads or other students who do not need to work while completing their degree.
Two types of part-time MBA programs exist:
- Executive MBAs (EMBAs): EMBAs are for students with several years of work experience in executive or leadership positions. These students are between 32-42 years of age. The student's employer normally pays their studies.
- Part-time MBA: These degrees are for full-time employees not yet in leadership roles. The average age of students is between 24-35 years. Part-time studies offer classes in the evenings after work or on weekends.
Respectable MBA programs require a GPA of 3.5 or better. The highest-rated programs require an even higher GPA score. In addition, the top-rated business schools require a Graduate Management Admission Test (GMAT) test score between 720 and 730 (out of 800).
Although excellent academic results offer a solid foundation for a MBA program, many business schools also value relevant work experience when considering candidates, especially for EMBA programs.
Pros to getting an MBA
An MBA has several benefits, including:
It can improve your career opportunities
An MBA can improve the range of career opportunities available to you. Over 75% of employers expect to hire MBA graduates in the coming year.
It can increase your income
An MBA can help you earn a higher salary or get a promotion. A study by the Graduate Management Admission Council found that base salaries were higher for MBA graduates compared to those without an MBA.
It enhances your work and personal skills
An MBA program develops your work and personal skills, such as communication and interpersonal skills. Modern MBA programs focus on business management, marketing and problem-solving, making it a valuable degree to have.
Alums recommend doing an MBA
A survey of MBA alums showed that the majority would enroll again if they had to decide about earning an MBA again. This number is higher for students that graduated during tough times.
An MBA provides opportunities for networking
Meeting people and networking with business representatives makes the degree worthwhile. Graduates' job opportunities improve through networking with peers and professors. Alumni reviewing your application may prefer appointing a graduate from their business school.
It broadens and deepens your knowledge
An MBA provides you with a deep knowledge of different topics. Case studies from businesses in different industries improve business knowledge and problem-solving skills. You can use knowledge and skills for many things, such as starting your own business.
It strengthens your resume
An MBA strengthens your resume. An MBA qualification is a good foundation for many careers, including executive roles, project management and market research roles.
Cons to getting an MBA
To get a complete picture of an MBA, consider the cons of getting an MBA:
It is expensive
Getting an MBA degree can be an expensive experience. It may not be affordable to everyone, especially for recent graduates. An MBA can cost up to $200,000 with several of the top-rated business schools' MBA programs costing even more. The costs of MBA studies are increasing each year.
You might have limited financing options
How you finance your MBA studies is important. If you have been working for a company for several years and the company will pay for your studies, the decision to enroll may be easier. You can consider using a student loan, but this will require a long-term commitment to paying it off and may affect your family or other areas of your life.
Not always a return on investment
Not all MBA degrees offer a high return on investment. An MBA at a top-rated business school will provide a payoff, but an MBA from a lesser-known business school may not provide much of a return.
Alternative qualifications may be more valuable
Alternative qualifications may be better for specific careers. For example, an MBA degree is ideal for a career in finance. For non-financial industries or non-managerial career paths, alternative qualifications may be more beneficial.
An MBA is not a requirement for any career
There is no specific career path where an MBA is essential. An MBA degree is not a requirement for success or to become a CEO. A study by Heidrick and Struggles found that only 35% of the CEOs in the United States have MBAs compared to 42% five years ago. Many boards no longer focus on academic credentials but find work experience more important for company transformation.
Timing affects job opportunities
During the boom years, MBA graduates find lucrative positions with large bonuses. During economic downturns, MBA graduates may find it difficult to find a position.
Studying full-time for an MBA can have a high opportunity cost. In specific industries, MBA graduates do not get appointed to senior positions as the company considers hands-on work experience as more valuable than an MBA. The opportunity cost could be lower for EMBAs or part-time MBA programs where you still gain work experience while studying.
How to decide if you should get an MBA
Before answering this question, assess your reasons for wanting to obtain the degree to make sure you are ready to commit to an MBA degree and that you choose the right area of specialization. The common reasons for considering an MBA degree include:
You want to earn a higher salary
An MBA leads to higher income, but work experience, an outstanding work performance and professional certifications can also result in salary increases.
You think an MBA is the best way to start your entrepreneurial ventures
An MBA can provide you with networking opportunities. It can help you explore new business ideas and start a new venture with the support of your business school and fellow students. An MBA provides a good base for developing a network, skills and knowledge to start a new business.
To determine if an MBA will help you start your own business sooner, test potential MBA programs using the following criteria:
- Does the program provide the practical leadership and management training required for an entrepreneurial venture?
- How did the alumni benefit from this MBA?
- Are there other alternatives that could hone the business skills you need?
You want to climb the corporate career ladder
You don't need an MBA for any specific career path. Factors to consider in choosing to do an MBA are:
- What industry am I working in and in which industries may I want to work in the future?
- Do I need an MBA for these industries?
- How do the industries I am interested in view the MBAs I want to pursue?
- Are there any alternative options to help me be a success in the industries I want to consider for a career?