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Is an MBA degree worth it?

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Latest comment posted at 6:00 PM EDT 28/03/08

Can you afford it? Can you afford not to? ...Read the full article

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  1. Richard Hawrelak from Sarnia, Canada writes: Yes, it's worth it, if it accelerates your advancement. The trick is knowing if it will. IMO, just another fishing expedition sponsored by our Universities.
  2. Steve Not an Alberta Redneck from Calgary, Canada writes: At tuition of up to $63,000 per annum, I'm sure that someone must be coming out ahead.
  3. Mark Kmicikiewicz from Montreal, Canada writes: I would suggest to read some opinions of Prof. Mintzberg from McGill. According to him, we can't form the leaders in the classroom. I agree. The first prerequisite of the real leader is to know his business in theory and have solid practical experience (shop-floor is the best). Shop-floor experience allows the real leaders to understand the workers.
    Young students getting their MBA just after university, it is a waste of time. All they learn [or just about] is how to cook the books. In most cases, young engineers, after getting their MBA are going to work for 'investment banking,' as there is where the money is. We see the results observing our economy. Our financial system is a swindle. Self regulation obviously is not working. Intermediates are making money on the commissions, and liability is pushed into public sector. Unless candidates have a solid work experience at leading level, and proper qualification to be able to handle superior level of mathematics (not just arithmetic) – they should not be allowed to get the MBA courses.
    MK
  4. Tim Runge from Guelph, Canada writes: I don't have an MBA . I have a B.Com. I graduated 30 years ago. The notion of an MBA then, when one had a B.Com was a peculiar one, and I would have to say that most of my graduating class did not get one. Why would they need one? An MBA was -in those days- a degree that was considered a bit of a pressure pot and was taken by those who had an undergraduate degree and had worked in business for a year or two and wanted some formal business training -accounting, finance etc. The degree's value had to do with the candidate's success at having crammed alot of information into a 2 year full time program (showed a mental toughness). Having had the experience in business also added a different texture to one's experience in the class room. Today, MBAs seem to be nothing more than a money making machine for the schools. Also there is a bewildering number of ways that one can get an MBA. Some people take years to get one. I wonder then, what is the value, over say, an undergraduate degree, like a B.Com? Where is the 'backbone making pressure pot' of an intense period of immersion in business theories and case loads? Some schools are handing out MBAs to people who don't even have undergraduate degrees (I know of one school in the UK). Some schools are combining MBAs with their undergraduate program. So a graduate will receive an undergrad degree AND and MBA. What is that all about? In the process the undergraduate business degree seems to have become debased, and almost irrelevant. It almost appears that employers see the MBA as a requirement and really don't have a clue as to its true value. Just some idle thoughts generated over the past 30 years!!
  5. brokeback mountain from toronto, Canada writes: an MBA degree is a total waste of money in Canada, most industry does not require an MBA to advance your career.. the recent economy meltdown in the States just prove that it doesn't matter how many MBA's you pumped out, it doesn't really help the economy... at work I deal with a lot of MBA graduates.. most of them do not even have the basic common sense or think logically.. it is really sad... and these are people in the marketing biz, where an MBA degree is supposed to be the meal ticket
  6. Brad Munro from Markham, Canada writes: As a business person that went back to school at 40 to get his MBA I can say from experience that it is a good thing to have but is by no means a guarantee of employment or upward mobility. There are many other factors that affect a persons ability to stay employed (company performance, industry trends, competitive pressure, inter personal skills etc) and/or enjoy career progression. There are also family issues that need to be considered in the pursuit of an MBA because it is also extremely demanding on the other members of the family. So I wouldn't consider an MBA a slam dunk in terms of being able to provide the solution for business success. My personal experience would suggest that you pursue an MBA in the interest of higher learning and self improvement not as a way to ensure career success.....
  7. Jatinder Sodhi from Mississauga, Canada writes: My contention is value of MBA depends on the Objectivs of the person going for it. Is it for improving your skills,building net work or improve your cash flow. As far as skills part is concerned,I think it is always worth going for an MBA but will it improve your cash flow? may not . I guess it depends on individual 's perception and needs. It needs commitment of time and resources and there is an oppurtunity cost involved,thus it is different for every individual.
  8. Globe Insider subscriber content
    Winter Mute from Toronto, Canada writes: The value of an mba made sense when there was oversupply of university grads as was the case between 1970-1990 when north american boomers were young, but now there's a shortage of same due to the baby bust of the nineties. Now it only really has value if you can pivot and change directions wrt career, but the mba is competing with the fact that you can pivot your career via an undergrad engineering degree, medicine, law, accounting designation, etc. There's also the fact that the bottom 50% of any mba class has been taken to the cleaners, since they are not any better off than they were prior to entering the mba program (and this is irrespective of which mba program is under discussion (putting aside harvard, wharton, chicago, MIT-sloan, etc.)).

    carry on
  9. Jeff H from Kingston, Canada writes: Interesting reading. I'm working on my undergraduate degree in Economics, and have been considering an MA in Economics or an MBA in the future. The MA seems like better value, but lots of higher jobs in Economics require a Ph.D, which is a much bigger commitment...

    Decisions, decisions.
  10. John B from United States writes: Having been on the hiring side at a NYC/Wall Street firm, we interviewed everyone from Princeton/Harvard MBAs, to GE Six-Sigma black belts and former Marines. After the HR department had screened people, I can say that credentials (MBA, CFA, etc.) might have gotten you to the second interview, but after that, it comes down to who you are as a person.

    Among the most important criteria - work experience (five years in the industry easily trumped the MBAs); independent thinking (what do you do when you hit a brick wall? Answer: come up with three alternative ideas, rather than give a blank stare); and last but not least, we asked ourselves, is this someone we want to work with (hotshots were quickly shown the door).

    In the end, our company paid top dollar to hire decent, thoughtful people who had worked their way up the ladder after 3-5 years. It was tough to find good people though, despite the fact that we advertised in the tri-state area, with a population of 10 million. We typically hired 1 in 20 people who made it to the second round, but it was well worth it.

    As for the MBA/CFA/CA advantage - it counted for less than 15% of our decision in the end. Experience - 30%, Intelligence - 30%, Decency - 40% (often more).
  11. Brian Friesen from Victoria, Canada writes: I am currently enrolled in a part-time MBA program, and so far, I am very happy. The program is flexible, the class sizes are small, and the quality of instruction is quite good. Is an MBA worth it? Depending on the person, i'm sure it is. As John B mentioned, there are a lot of other factors that contribute to career advancement and hiring potential. If you are bright, hard-working, and dependable, an MBA will absolutely help on the job hunt. If you're a hot-shot know-it-all, you'll be shown the door. Education is important, experience is important, and personality is important. A solid combination of all 3 will ensure success professionally.
  12. Tango Tiago from Calgary, Canada writes: Thanks for the comments John B. You have helped make up my mind - that I do not need an MBA!

    Does anybody know a website where to see some stats on MBA vs non-MBA salary, after-MBA learning differential, etc?

    I like this article and the conversation.
  13. larry hallatt from Canada writes: As a former Business Professor, I believe too much BS has been put on the benefits of MBA training. Most undersgraduates get as good a training at a fraction of the cost. Often higher salaried benefits equated to an MBA degree are a direct result of the older age and additiuonal work experience of students entering the MBA programs. The one serious draw back with MBA's is that few have the inclination of becoming entrepreneurs. MBA programs are focused to make individuals large company employees not successful start up entrepreneurs or business owners. In general, Business Schools are very poor training grounds for entrepreneurs and innovators!. A large number of the most successful busness people like Gates and Jimmy Paterson are drop outs...people with personal drive and ambition to build something personal. Certainly, many recruiters in large companies naively hire based on Alma Maters........it is one reason North American managers have fallen down, produce senior executives that fleece companies with inflated compensation levels and why so many Companies have been sold out in Canada or put into receivership. Too many MBA's and Accountants in an enterprise is like in breeding and creates problems. People think too closely like their associates and can not get out of their narrow boxes. For a small number MBA's are the avenue one should follow, but for most it is more important to choose to become educated and often that requires one to invest time and hard effort in the work place. Each type of formal education has value, but it is only one way to one's goal. For self learners with dicipline, the internet and the public library can produce as good a result especially if you choose to become the owner of an enterprise..
  14. Kevin F from Toronto, Canada writes: With a total minimum opportunity cost of $200,000 (60k tuition, loss of 140k salary) it's a tough decision! Add to that a very small pool of truly lucrative jobs in Canada and John B's reluctance to recruit CAD MBA grad's the payback period can be very large if not prohibitive.

    MBA Candidate, 2008
  15. Mike M from Toronto, Canada writes: I have an MBA (Chicago) and before I went I was told that if you're not going to one of about 8 or so schools (Harvard, Wharton, Chicago, Sloan, Kellogg, Tuck, Stanford, Columbia - maybe a few more) it's not worth it at all. Having completed my degree and worked with people from a variety of schools, I can say that 8 schools may be setting the bar a bit high, but it's not too far off. Once you get beyond the top-tier schools, there definitely are solid graduates, but it's more a reflection on the individual than the actual program itself.

    An MBA is not something that is universal across all schools - the caliber of student, degree specialization, flexibility in course selection, method of instruction, decision-making frameworks, degrees of collaboration, opportunities for practical application while in school, etc., etc. vary quite widely across each school. To make blanket decisions about whether an MBA is a good idea or not is similar to saying that cars are bad because you drove a Prius and it sucked - without having ever taken a Bentley for a spin.

    And Tango Tiago - if you can make up your mind on an MBA based on a 4 paragraph response from a stranger on a comment board, I think an MBA is a few steps down the road from meeting your needs. I'm not saying I disagree with John B (I generally agree with his comment), but step back and think if you should truly make a decision based on what anyone here says.
  16. W W from Canada writes: I would like to comment further on why most of the European CEO don't have an MBA. Until virtually the last year most European universities apart of those in the UK did not have a Bachelor’s degree. The first university degree was essentially a Master's degree as it was a five-years degree with oral thesis defense. Therefore every business/economics degree was a Master's degree. In North America there was a need to complement a four-year (often a specialist) degree with a Master's degree.

    As Europe is accepting the North American/British model in higher education you can see that MBA programs are mushrooming everywhere.
  17. W W from Canada writes: Sorry a banal suggestion but those of you who contemplate taking an MBA, why don't you go a major or specialized job search site and enter MBA as a key word. This should give you a good idea on what is the situation on the job market right now.
  18. raymond yang from Hfx, Canada writes: I do believe a professional designation has higher ROI than does a two year full time MBA. I worked at some large financial companies both in Ontario and some other places. 99% of the managers and directors at the companies I worked don't have MBA and what they have invested is a 4-year undergraduate degree coupled with a professional designation, which is often funded by the company. If you happen to be working with an entity in the accounting take an accounting designation in to consideration when it comes to promotion and so on.
  19. Pat Billings from CDN, Canada writes: The ideal MBA is a part-time one where an employer will sponsor you.

    The opportunity cost is much lower, you continue gaining work experience, you get to immediately apply what you have learned and you interact with people from a variety of backgrounds who are employed in different industries.

    The only downside is that the strong networks that are built through full-time will suffer. So will your weekends....
  20. Robin The Unhedged from Toronto, Canada writes: John B, don't you mean CPA?
  21. kd john from toronto, Canada writes: hi there,

    I have an undergrad degree in commerce from DeGroote at McMaster University and I am currently working at Ernst and Young. I plan on switching over to I-banking or buy side once I get my CA/CFA with 5 years of experience and at that point, I am not too sure if going back to school for MBA is really worth it.. what are your thoughts?
  22. PC mg from Calgary, Canada writes: Wow, the CFA doesn't seem to get good treatment out of this discussion. Are there too many CFA's in the market now?

    The ROI for someone who already has a designation "C" after their name appears to be negative in most cases except for Top U.S. MBA's. The number of U.S. MBA's awarded has at least tripled since the mid 70's, so you know, supply and demand.
  23. Mike Michaels from Toronto Expat, United States writes: The MBA is an excellent degree. Before I went to school for mine, I did not know that I really liked wine and cheese. Two years of classes, without any real learning though, and boy had I grown to appreciate those wine and cheese sessions.
    The real value of the MBA is that after a significant investment, the candidate/student has gained no valuable skills. From a marketing perspective it's a great deal, because someone just paid an aweful lot of money for nothing, but then, maybe that is the point.
  24. Jim McBob from Canada writes: KD John
    I am CA with 20 years of industy experience, much of it at the CFO level. I've worked with lots of i-bankers and CFAs. My BComm is from a very well respected school.
    Here's my advice:
    It is very hard to predict where you will be in 5 years and so I would caution you against "over planning" your life. A CA or CFA is a ton of work and very valuable in itself. If you are a well-rounded individual with good business instincts then you might find an MBA unnecessary. In any event this is not a decision you need to make today. Look around in a few years and ask yourself if the people you see with MBA's have something that you want. It's really that simple. My guess is that you'll determine there's not that much value-add if you already have your CFA and/or CA. Industry specific experience and knowledge are more important than additional credentials in my view.

    Also, please remember that you get what you pay for in life and this is free advice :=)
  25. Peter Simpson from Vancouver, Canada writes: I probably should have considered my options before completing an MBA. I have no regrets and it has helped me in many ways. That said had I been willing to move to a major financial/business center, Toronto, New York, or Miami the MBA would have delivered more.

    So if you live in a small "head office" center in Canada, meaning outside Calgary or Toronto, and you are a career type I wouldn't recommend an MBA.
  26. Robbin at Mormac from Alvinston, Canada writes: I very much would have liked to see something about the value of an MBA from the employers point of view. From my personal experience the major thing the MBA program teaches is an attitude of self-importance. The theoretical nature of the MBA program often seems to have little basis in the real world beyond the production of pretty reports and paperwork. Often when it gets down to the actual tactics needed to run a company, and increase market share, the MBA has little regard for the knowledge of the front-line worker and even less knowledge of the actual tactics needed to produce actual ROI.

    Too many companies also seem to have bought into this idea that an MBA makes you an expert at everything, much to their own chagrin. Let's keep in mind that some of the most spectacular failures in the last decade (Enron, Worldcom, Nortel, etc) have had MBA's attached to them. Also keep in mind one of the most famous MBA's currently around is George Bush, whose presidency carries the dubious distinction of not only wiping out a surplus but plunging the country into the largest deficit ever seen and whose policies are helping to create a recession.
  27. Luke R from Toronto, Canada writes: MBAs were worth it when the tuition was $6000/yr (and that was ony in the mid 90s. Now at $35,000/yr (UofT, Queen's, Western) I would be hard pressed to think it's worth it. Go to the UofT web site and look at the starting salaries of MBA grads, they're not that high. The average is in the high $80,000. But do keep in mind that most of those people were ,robably making $60,000-$70,000 before they went in. Is it worth it? In the US it's a different story because salaries are MUCH higher for MBA grads.
  28. western dude from deamonton, ab, Canada writes: Education in Canada is a waste of money. For the fast trackers good grooming, a winning personality and a membership in the local golf and country club or if you live in TO the Empire Club will get you further. Face it the economic and political elite of Canada have no time to deal with wannabees and an MBA. Most still refer to an MBA as More Bull and Assumptions. For those long in the tooth from the 80's it also meant Mexico, Brazil and Argentina. With most MBA's being forced to take jobs in banks in Canada why is there a meltdown of these institutions every 7 years with the host of MBA's and fellow club members runnign the show. No save your money and work on your interpersonal skills and cosmetic surgery is your better option than an MBA.
  29. Igor Stojcic from listowel ontario, Canada writes: Not to say MBA's aren't as smart as they're cracked up to be, instead far from it. However, and I just got this thing in the mail from Ivey (out of them all go figure) how I can work for 5 years in management position (I'm a 22 and a CEO) and they would literally hand me an MBA designation without forking over one penny!! Imagine that!! So looks like these ivey league schools are going back to the basics and realizing that in today's world, it's not enough to just know theory, you MUST know practical hands on. What do you do when your debit machine doesnt work on the opening night of the restaurant meanwhile all your Guests are AmEx holders? There goes your brand out the door.
    As a CEO, I would give the MBA a second interview for sure, I respect the discipline to get that, however I'd be using the EXACTLY the same criteria if the BA candidate applied. I want results I want them now and I want a proven known way of getting them. I dont want 20 page report on why some things work the way they work and then I'm back to the starting page. MBA's (and I don't mean to be racist or anything) but half the people that have them use them for ego boost and show they come from wealthy family. For my money honey, I want to know what is your short long term goals, how to fix the given issue and how we fix it. An MBA, would tell me, we have to hire this to do quantitiative, hire this person to do qualitative, oh please, before you know it, you have a fleet of people following you all with alphabets behind their names, but yet, none know what the problem even is after all that, let alone how to fix it. Very tough one, very very tough one.
  30. john gordon from Canada writes: There is absolutely no doubt that an MBA is worth it however you do need to have the personality, etc. to go with it. It is a definite advantage. However, it isn't necessarily of any more value than a CA (and not just for "accounting jobs").

    Whether or not it should is a different story.

    I myself do not have one and am an executive in a mid size Canadian company. When we hire mid to senior level managers we usually go with the MBA/CA.
  31. More or Less from Canada writes: A MBA is not the same as a CFA ... the former is more a broad based general business focus whereas the latter is more financial analysis oriented. Your long term career goals will determine which would be more appropriate. That being said, I've seen graduates who have done a masters in business and also concurrently completed the requirements for a CFA designation (the industry I'm in requires the CFA). Having been involved in hiring both over the years, I'd say the ones who drove me nuts the most were the MBAs who thought those letters meant they would be given keys to the CEO suite. IMHO give me real life business experience & street smarts over an individual who only has classroom case-study experience.
  32. Randell Sonmor from Calgary, Canada writes: An MBA is partly worth but only, and I repeat, but only if its an add on to an already solid degree or profession. It is no more valuable that any other masters degree (MSc). I earned my MBA 12 years after earning my engineering degree, and I then returned to the engineering field. I was re-hired because of my technical qualifications, NOT because of my MBA. It has, however, given me a broader perspective and helped me to become a better manager. But it still is a lot of hype from the biz schools. In comparing people that I have, and am currently working with, that have or don't have MBAs, there is absolutely no difference. I have the pleasure of working with many talented, bright, highly competent individuals without MBAs, and I'd take them any day over newly minted MBAs who have never dirtied their hands on the shop floor, refinery, gas plant, mine, mill, dairy farm, etc. And, most MBAs in Canada don't have a clue about operating on the rough, highly competitive, bare-knuckled world stage. I have been working overseas for 10 years now, and the MBA did not prepare me in any way. Nor did I expect it to before I went abroad. Forget what the biz schools tell you, but its one's technical qualifications, savvy, wits, ability to listen, learn and integrate with people from other cultures that carries the day. My advice to any recent MBA grad looking to work overseas is to leave your fancy suits, shoes, attitude and biz school speak at home. Just be yourself, respect others, listen, listen even more, be prepared to learn something new every day, work hard, contribute effectively, be firm but not arrogant, and remember that you are also an unofficial ambassador to Canada, so conduct yourself accordingly.
  33. Mike M from Toronto, Canada writes: I think the tuition at MBA programs is scaring people off when it's not really accurate.

    I can only speak for the top schools in the US, but I know that currently, in most schools 1 out of 6 to 1 out of 3 students have a full-scholarship. Toss in the amount of people who are also completely sponsored (either by the company they worked for beforehand or the one they interned with) and tuition is something that a lot of people will not have to be concerned with.
  34. K. Ardee from Montreal, Canada writes: McGill MBA 2000., middle manager, 15 yrs experience at the time. Downsized shortly after obtaining. The only serious discussions for other jobs happened when the MBA was removed from my CV. Most I have spoken with, quite a good cross section here in Mtl, regard an MBA as senior manager calibre. Without senior manager experience however, the MBA by itself is not enough for that type of spot. It's overkill for the middle manager role. You tend to get sorted out when applying for spots - you're neither here nor there. There can be a certain level of professional disappointment knowing the level at which you can perform and the level at which you are being asked to perform. Enjoy the learning, it is fulfilling, but gain experience on the job to reach for the top. gohabsgo.

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