Is the MBA losing its value?

Apr 09 2009 by Nic Paton Print This Article

For many executives doing an MBA is the equivalent of the "get out of jail free" card in Monopoly Ė a way of ducking out of the recession at its peak and, hopefully, coming back refreshed, reskilled and even more employable just as things start to pick up.

But, with everyone else thinking the same thing, does it still make sense to do the gold-standard management qualification under your belt?

Certainly, business schools on both sides of the Atlantic have been reporting surging interest from managers keen to get their heads down and do an MBA.

In a recent survey of more than 500 MBA programmes by the Graduate Management Admission Council, for example, more than three quarters said they were seeing a rise in applications from potential students, compared with fewer than two thirds in a similar survey last year.

Top U.S schools such as Harvard Business School, Sloan at MIT and Kellogg at Northwestern University have all reported double-digit rises in applications.

In the UK, it's a similar picture, with many schools reporting a sharp rise in applications, especially for full-time courses, indicating that it is perhaps often managers who have been thrown out of work who are using their redundancy pay-out to take the plunge.

Yet, at the same time, there is also some evidence that executive MBA programmes are suffering as companies become less willing to spend money sponsoring employees through programmes or to release them to study block courses.

And this understandable emphasis by struggling employers on wanting to keep talent on the front-line is prompting business schools to take ever more innovative approaches to wooing people on to their programmes.

For example, Boston's Hult International Business has this month launched a taster "Pocket MBA", in a move that it claims is a world first.

The Pocket MBA will consist of a series of short, intensive seminars over two days later this month on how to manage during the global downturn, at the end of which attendees get a certificate.

The school's Dr Stephen Hodges said: "We want to give professionals and companies a taste of our top-ranked one-year MBA programme in an abbreviated format, while offering them a chance to gain valuable insights they can apply immediately to their own companies."

At the same time, Rotterdam School of Management has cut its 15-month full-time MBA to 12 months to allow its graduates to get back to work that much more quickly.

Dianne Bevelander, associate dean of MBA programmes at the school, said: "RSM MBAs are known to thrive in any setting and to outperform given even the toughest challenges. This 12-month programme will continue to produce outstanding MBAs for which RSM is renowned, but in a shorter time so as to meet the changing needs of markets and employers."

Another sign of apparent cost-cutting by business schools is the decision by Audencia in Nantes, HHL in Leipzig and MIP in Milan to merge their careers advice, corporate relations and placement programmes.

The move, presented as means of sharing a "spirit of openness and responsibility" between the schools, will see the three schools acting as one on their pre-programme activities as well as their post-programme and alumni activities.

The underlying question within all this, of course Ė and one where the answer is still by no means clear Ė is whether this influx of MBA graduates, when it subsequently spills out on to the jobs' market in a year's time, will lead to a dilution of the MBA gold-standard brand. After all, if everyone has one, surely it isn't special anymore?