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The Value of a Masters in Business Administration (MBA)
Posted By Jim On 10/12/2005 @ 8:00 am In Personal Finance | 14 Comments
Originally published April 27th, 2005.
The company I work for has a great continuing education program where I can get a post-graduate degree on their dime and no commitment after I finish (it’s typical for companies to require another year or two of service after graduation). The continuing education covers tuition and registration, but not books or other supplies; a pretty standard agreement. Some places offer free books too but at the cost of perhaps only $100/class versus tuition which, at Johns Hopkins University, runs around $1500 a course… it’s small potatoes. Given that, is getting an MBA worth it?
In a Yahoo! Finance article, the GMAC, the people who administer the GMAT, claimed that the average MBA graduate gets a 35% raise from $56k to $76k. They didn’t go into if that raise was the result of a job change (which I suspect, a 35% raise is pretty sizeable) or a promotion, but 35% means the outlook is positive. Personally, I don’t expect a raise (and it’s not why I’m doing it) for it. They want to learn how to think different and, for engineers, the gray areas of business are hard to accept for people who are used to numbers, laws, and rules. In engineering, if you design something, it follows the laws of physics. In, say, marketing, when you design a plan, you certainly get feedback and statistics about its effectiveness but it’s not the same as the results of a simulation of a designed part. I think that’s one of the hardest things for engineers to understand and respect.
MBA’s are also about networking, which is difficult in a part time program. But I’m unable to leave work, spend a couple years at a Wharton/Harvard business program (if I could even get in) and get the serious business schooling an MBA really means. I think unless you go to a top tier school, the rest pretty much are the same: take some classes, pay some money, and get your degree. Ultimately, the MBA is trying to teach you experiential knowledge in a classroom setting.
Update: FYI for our RSS Feed readers who can’t see comments, I strongly suggest you visit the site and read the comments. They’re very informative and give disparate opinions on the whole part-time MBA issue. (4/29/05)
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