What is an MBA actually worth?

There is a commonality that links almost all of the leaders of the business world, and that's three letters: MBA. The prestigious degree provides extensive training in several major theories and practices of business management and finance over the course of one or two years. Many pursue an MBA to open up new employment opportunities, obtain promotions and accelerate their careers, but the question remains, what is an MBA actually worth?

Training is priceless

One of the most important contributions an MBA can provide to one's career is a quality education in business practices that students might use every day in the field.

In addition to traditional scholastic techniques, students are taught through what's called the Case Method.  In a Case Method, students are provided with a packet of information detailing a problem or series of problems facing a company and a slew of contextual information detailing every aspect of the organizations day to day operations.  The task is to provide a solution or course of action to the company that conforms to legal precedents and keeps the financial solvency of the company in mind.

"I think that's what life and work is all about," says Katherine Gay, vice-president of corporate communications at a Canadian Bank, in an interview with the Financial Times. "In my work today, I have floods of conflicting demands and I have to prioritize really quickly to figure out what the real issue is and respond to it. That's training an MBA gives you and it's very valuable in any kind of job you go into."

Paying for an education

A consideration to make when pursuing an MBA is financing a two-year program with the cost of college tuition continually rising.

According to the Vancouver Sun, many MBA programs are forced to charge higher tuition because they are often self funded, meaning that the fees will have to cover the cost of maintaining a fully functional administration, support staff, recruiting department, equipment, campus and faculty both residential and visiting.  The sun also notes that business and management professors often command higher salaries due to the profitability of their credentials and skill set.

"Business professors are probably paid close to double what other professors make, because if they weren't teaching they'd just go out and start a consultancy, which is more lucrative yet," Business school dean Brian Bemmel tells the Times.

Though the costs of a traditional business school can be great, there are a few ways to attain an MBA in a more cost-effective manner.

The rapidly expanding selection of online MBA programs typically provide flexible class scheduling to better accommodate students with part- or full-time jobs and commonly present lower tuition rates than more conventional classroom learning.

Many employers offer subsidized reimbursement options or paid leaves of absence for workers who sign up for MBA courses, though there are often conditions of exclusivity to these agreement.

"A small number of students get their full tuition paid, which requires often a two-to five-year commitment to work for that company, with an option to repay their tuition if they decide to move on before fulfilling that term," MBA admissions director Niki da Silva shares with the Times.

Benefits to be had

An MBA can increase one's profile to recruiters looking for talented employees.

"You can make some immediate assumptions about the individual: that they understand the full spectrum of corporate functions like finance and marketing, accounting from a management perspective and it's also an indication of the kind of person you are," Katherine Gay tells the Times.

There are also financial considerations.

According to a 2006 survey conducted by the National Association of Colleges and Employers, the average salary of a first-year MBA graduate was between $50,000 and $75,000, with over 40 percent earning $75,000 or more.

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