The best MBA program
There are quite a lot of interest in MBA these days. Here are some of the more logically and statistically sound articles and rankings available. A lot of these will have an international focus.
The Wall Street Journal ran an article about the return on investment (ROI) from an executive MBA (EMBA) program. I did not find clear statistics of the surveys but, but the methodology and assumptions seemed to be directionally sound. In short, the calculations depend on these assumptions:
- The MBA program attended and its cost.
- The amount of tuition and fees paid by your employer.
- The increase in salary that you can expect from graduating the program, based on median results from other respondents.
Take note of the profile of the median results reported by graduates of these survey rankings, if your circumstances differ from them substantially, the result might not be what you will expect. Moreover, these analysis is conducted on a pretax basis which may greatly overstate your ROI, since salary increase will be subjected to taxes, whereas expenditure on tuition fees is likely to be non-deductible.
Interestingly, lesser-known, less-renowned executive MBA programs are found to offer the best ROI. What the article fails to address, however, is local bias. In other words, example, if you travel to U.S.A to one of these high ROI programs, you may not get the same results back home as do the local attendees. This factor should have been controlled for, difficult as it is.
Which Executive M.B.A.s Pay Back?
On another article in Forbes magazine, which contains a ranking of MBA programs based on a cost/benefit analysis (the average increase in pay post MBA compared to the costs of obtaining it). Like that other study, the figures comes with caveats:
- Salary data depends on the accuracy of respondents’ replies to a survey
- The analysis is done on a pre-tax, rather than an after-tax basis.
- To be really meaningful, the data on average salaries (both prior to and after receiving the MBA) by school should be disaggregated by industry and profession, as well as by respondents’ years of prior experience.
- Forbes’ calculation of years to payback on an MBA is remarkably constant across the 50 programs surveyed: ranging from 3.9 to 4.6 years.
The final article is from Economist Intelligence Unit which has been running this ranking for a decade. The study prides itself in their methodology and independence, even having Whitehead Mann to review the MBA rankings process. Once again, data collected by questionnaire can, potentially, subjected to distortion through “rigging”, though this is kept to a small weighting and compared with data for the past decade.
The ranking process places emphasis on other aspects like opening new career opportunities, personal development/educational experience and networking potential. Increase in salary, main focus of other studies account for only 20% weighting.
This is also the only study which Asian schools feature in with HKUST topping Asia at rank 30, followed by a couple of other Hong Kong business schools. ISEAD, with France and Singapore campus is at 23. NTU’s Nanyang Business School is Singapore’s highest ranking local program at rank 71.
It seems like for some institutions, MBA is really a product sold for profits. As with the economics of demand and supply, ROI is consequently affected.
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