The ROI of an MBA
1
Traditional: years Accelerated: On-campus, 12-18 month intensive MBA program Part-Time: On-campus, part-time (nights/weekends), typically 3 years Executive MBA: On-campus or online, part-time (nights/weekends), typically 1-2 years Online: Online MBA program with flexible scheduling, typically 18 months to 3 years 1 2 3 0 $90,000 2013 median starting annual base salary for full-time, two-year MBA graduates— up from $86,700 in 2012 2 $10,000 2013 bonus and additional compensation for full-time, two-year MBA graduates 3 10 % Growth of MBA salaries over the last decade 3 Upon graduation, the average percentage increase in post-degree salary: 4 81 % For graduates of full-time, two-year MBA programs 53 % For graduates of part-time MBA programs Previous work experience is also related to salary increases: 5 For graduates with less than three years of work experience For graduates with three to six years of experience For graduates with more than six years of work experience 120 % 75 % 46 % Salary range at the elite end of the MBA hiring market 4 $110–150,000: $110–$130,00: Salary range offered by strategy consulting firms 4 $90–$200,000: Salary range offered by investment banks 6 $100,000 $200,000 $150,000 Higher Employment Rates Total compensation (salary, bonuses, exercised stock options) in the first 5 years aſter business school 9 VS Total cost (two years of forgone compensation, tuition and required fees) of earning an a full-time MBA 5-Year MBA Gain: Represents the net cumulative amount the typical alumni would have earned aſter five years by geing their MBA versus staying in their pre-MBA career Top 15 Schools with the Best “5-Year MBA Gain” 10 School Total 5-Year MBA Gain ($) Years to Payback Pre-MBA Salary ($) 2012 Salary ($) Tuition ($) STANFORD 4.1 CHICAGO 3.7 HARVARD 4.0 PENNSYLVANIA 4.0 NORTHWEST 3.8 DARTMOUTH 3.9 COLUMBIA 3.9 DUKE 3.7 CORNELL 3.8 MICHIGAN 3.7 UNC 3.7 MIT 4.0 UCLA 3.8 UC BERKELEY 4.0 VIRGINIA 3.8 Student Reflections on Earning an MBA Created by: Graduates report recouping: 11 1/3 Of their investment over the first year of work 100 % Of their investment four years aſter graduation 2x Their investment ten years aſter graduation 1 www.allbusinessschools.com/business-careers/article/length-of-mba-program 2 www.poetsandquants.com/2013/11/18/mba-employment-a-whopping-95/ 3 www.topmba.com/sites/qs.topmba/files/topmba.comjobs_salary_trends_report.pdf P52 4 www.poetsandquants.com/2012/05/30/the-mba-bump-how-much/ 5 www.poetsandquants.com/2012/05/30/the-mba-bump-how-much/ 6 www.topmba.com/sites/qs.topmba/files/topmba.comjobs_salary_trends_report.pdf P14 7 www.topmba.com/sites/qs.topmba/files/topmba.comjobs_salary_trends_report.pdf P26 8 www.geteducated.com/career-center/detail/online-mba-facts 9 www.forbes.com/sites/kurtbadenhausen/2013/10/09/the-best-business-schools-behind-the-numbers/ 10 www.forbes.com/business-schools/ 11 www.poetsandquants.com/2012/01/11/mba-still-worth-it-absolutely-say-alums/ 12 www.poetsandquants.com/2014/03/17/the-mba-degree-is-it-really-worth-it/ 13 www.gmac.com/why-gmac/gmac-news/gmnews/2013/january-2013/whos%20pursuing%20an%20online%20mba.aspx Sources 221,000 200,000 205,000 205,000 176,000 189,000 192,000 152,000 155,000 153,000 141,000 185,000 165,000 175,000 158,000 80,000 76,000 80,000 80,000 73,000 99,700 92,600 79,600 74,400 73,100 72,000 74,000 63,000 59,000 61,000 60,000 70,000 65,000 71,000 67,000 117,960 116,969 126,576 116,762 116,085 121,080 124,198 112,307 117,790 112,588 105,678 119,640 11,638 107,928 113,800 71,000 70,200 68,100 59,000 68,000 67,100 66,600 66,100 65,400 64,700 Salary Data According to March 2014 GMAC data, MBA graduate respondents: 12 70 % 80 % 100 % 90 % Rate the value of their degree highly Have high degrees of job satisfaction Rate their MBA as offering good to outstanding value compared to the total cost of their degree Say they would recommend their MBA program to others Are proud to have aended their MBA program 96 % 95 % 94 % 83 % 94 % According to November 2013 GMAC data, 2013 MBA graduate respondents: 2 96 % Rate the value of their degree as outstanding, excellent or good and would recommend a graduate management education to others 3 out of 4 Say they could not have obtained their job without their graduate business education Business school alumni report that their MBA program was: 77 % Financially rewarding 90 % Professionally rewarding 94 % Personally rewarding Business knowledge Leadership and management skills Networking Salary increase/promotion WHY GET A MASTER of BUSINESS ADMINISTRATION (MBA)? PROGRAM OPTIONS 1 POTENTIAL BENEFITS The return on investment for an on-campus MBA program proves to be substantial. Similarly, a high-quality online MBA program will reap the same benefits while also allowing you to continue to remain employed, save time and money commuting, and spend more time with your family. Online MBAs provide increased flexibility, with lower opportunity costs. Major Factors Driving Online business Education Innovative technology allows face-to-face interaction and networking like never before Flexible programs appeal to busy working professionals Students can remain employed while pursuing their MBA With online classes, there’s no need to relocate to aend a top-tier program Students can apply what they learn in class on the job the next day, gaining real-time results Less time commuting According to The Get Educated online MBA survey in fall 2011, 8 the MBA is the #1 most popular online graduate degree. According to GMAC’s 2012 Application Trends Survey: 13 87 % Online/distance MBA candidates are domestic 1/3 Online/distance MBA candidates live in the same metropolitan area of the school 9,000 The number of unique GMAT examinees who sent score reports to online/distance MBA programs (2012)—up from 7,500 in 2008 14 ONLINE PROGRAMS RETURN ON INVESTMENT Who Pursues an MBA? Business professionals looking to advance their careers—either via internal promotion or a new job—and contribute at a higher level Entrepreneurs who want to start a business or manage their existing business more effectively Professionals with degrees in other disciplines who will use an MBA to move into management roles within their fields or change industries altogether Professionals who want to use their business knowledge and skills to make a difference in the world Anyone who is looking to improve their strategic thinking in order to make beer decisions within their profession—the MBA skill set is applicable in any industry On-campus, full-time, 2-year MBA program Average Salary Ranges for Graduates of Full-Time MBA Programs Forecasted growth in MBA hiring rates for 2014 7 16 % What Is the Value of an MBA? The ROI of an MBA
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According to GMAC data, 96 percent of MBA graduates rate the value of their degree as outstanding, excellent or good and would recommend a graduate management education to others. Three out of four graduates say they could not have obtained their current job without their graduate business education. Source: http://onlinemba.unc.edu/mba-at-unc-blog/mba-roi/
Transcript of The ROI of an MBA
Traditional:
years
Accelerated: On-campus, 12-18 month intensive MBA program
Part-Time: On-campus, part-time (nights/weekends), typically 3 years
Executive MBA: On-campus or online, part-time (nights/weekends), typically 1-2 years
Online: Online MBA program with flexible scheduling, typically 18 months to 3 years
1 2 30
$90,0002013 median starting annual
base salary for full-time, two-year MBA graduates—
up from $86,700 in 20122
$10,000 2013 bonus and additional compensation for full-time, two-year MBA graduates3
10%Growth of MBA salaries
over the last decade3
Upon graduation, the average percentage increase in post-degree salary:4
81% For graduates of full-time, two-year MBA programs
53% For graduates of part-time MBA programs
Previous work experience is also related to salary increases:5
For graduates with less than three years of work experience
For graduates with three to six years of experience
For graduates with more than six years of work experience
120%
75%
46%
Salary range at the elite end of the MBA hiring market4
$110–150,000:
$110–$130,00:Salary range offered by strategy consulting firms4
$90–$200,000:Salary range offered by investment banks6
$100,000 $200,000$150,000
Higher Employment Rates
Total compensation (salary, bonuses,
exercised stock options) in the first 5
years a�er business school9 VSTotal cost (two years of forgone
compensation, tuition and required
fees) of earning an a full-time MBA
5-Year MBA Gain:
Represents the net cumulative amount the typical alumni would have earned a�er five years by ge�ing their MBA versus staying in their pre-MBA career
Top 15 Schools with the Best “5-Year MBA Gain”10
SchoolTotal 5-Year MBA Gain ($)
Years to Payback
Pre-MBA Salary ($)
2012 Salary ($) Tuition ($)
STANFORD4.1
CHICAGO 3.7
HARVARD 4.0
PENNSYLVANIA 4.0
NORTHWEST 3.8
DARTMOUTH 3.9
COLUMBIA 3.9
DUKE 3.7
CORNELL 3.8
MICHIGAN 3.7
UNC 3.7
MIT 4.0
UCLA 3.8
UC BERKELEY 4.0
VIRGINIA3.8
Student Reflections on Earning an MBA
Created by:
Graduates report recouping:11
1/3 Of their investment over
the first year of work
100%
Of their investment four years a�er graduation
2xTheir investment ten
years a�er graduation
1 www.allbusinessschools.com/business-careers/article/length-of-mba-program
2 www.poetsandquants.com/2013/11/18/mba-employment-a-whopping-95/
3 www.topmba.com/sites/qs.topmba/files/topmba.comjobs_salary_trends_report.pdf P52
4 www.poetsandquants.com/2012/05/30/the-mba-bump-how-much/
5 www.poetsandquants.com/2012/05/30/the-mba-bump-how-much/
6 www.topmba.com/sites/qs.topmba/files/topmba.comjobs_salary_trends_report.pdf P14
7 www.topmba.com/sites/qs.topmba/files/topmba.comjobs_salary_trends_report.pdf P26
8 www.geteducated.com/career-center/detail/online-mba-facts
9 www.forbes.com/sites/kurtbadenhausen/2013/10/09/the-best-business-schools-behind-the-numbers/
10 www.forbes.com/business-schools/
11 www.poetsandquants.com/2012/01/11/mba-still-worth-it-absolutely-say-alums/
12 www.poetsandquants.com/2014/03/17/the-mba-degree-is-it-really-worth-it/
13 www.gmac.com/why-gmac/gmac-news/gmnews/2013/january-2013/whos%20pursuing%20an%20online%20mba.aspx
Sources
221,000
200,000
205,000
205,000
176,000
189,000
192,000
152,000
155,000
153,000
141,000
185,000
165,000
175,000
158,000
80,000
76,000
80,000
80,000
73,000
99,700
92,600
79,600
74,400
73,100
72,000
74,000
63,000
59,000
61,000
60,000
70,000
65,000
71,000
67,000
117,960
116,969
126,576
116,762
116,085
121,080
124,198
112,307
117,790
112,588
105,678
119,640
11,638
107,928
113,800
71,000
70,200
68,100
59,000
68,000
67,100
66,600
66,100
65,400
64,700
Salary Data
According to March 2014 GMAC data, MBA graduate respondents:12
70% 80% 100%90%
Rate the value of their degree highly
Have high degrees of job satisfaction
Rate their MBA as offering good to outstanding value compared to the total
cost of their degree
Say they would recommend their MBA program to others
Are proud to have a�ended their MBA program 96%
95%
94%
83%
94%
According to November 2013 GMAC data, 2013 MBA graduate respondents:2
96%
Rate the value of their degree as outstanding, excellent or good and would recommend a graduate management education to others
3 out of 4Say they could not have obtained their job
without their graduate business education
Business school alumni report that their MBA program was:
77%
Financially rewarding
90%
Professionally rewarding
94%
Personally rewarding
Business knowledge
Leadership and management skills
Networking
Salary increase/promotion
WHY GET A MASTERof BUSINESS ADMINISTRATION (MBA)?
PROGRAM OPTIONS1
POTENTIAL BENEFITS
The return on investment for an on-campus MBA program proves to be substantial.
Similarly, a high-quality online MBA program will reap the same benefits while also
allowing you to continue to remain employed, save time and money commuting, and
spend more time with your family.
Online MBAs provide increased flexibility, with lower opportunity costs.
Major Factors Driving Online business Education
Innovative technology allows face-to-face interaction and networking like never before
Flexible programs appeal to busy working professionals
Students can remain employed while pursuing their MBA
With online classes, there’s no need to relocate to a�end a top-tier program
Students can apply what they learn in class on the job the next day, gaining real-time results
Less time commuting
According to The Get Educated online MBA survey in fall 2011,8
the MBA is the #1 most popular online graduate degree.
According to GMAC’s 2012 Application Trends Survey:13
87%
Online/distance MBA candidates are domestic
1/3Online/distance MBA candidates
live in the same metropolitan area of the school
9,000The number of unique GMAT
examinees who sent score reports to online/distance MBA programs
(2012)—up from 7,500 in 200814
ONLINE PROGRAMS
RETURN ON INVESTMENT
Who Pursues an MBA?
Business professionals looking to advance
their careers—either via internal promotion
or a new job—and contribute at a higher
level
Entrepreneurs who want to start a
business or manage their existing business
more effectively
Professionals with degrees in other
disciplines who will use an MBA to move into
management roles within their fields or
change industries altogether
Professionals who want to use their
business knowledge and skills to make a
difference in the world
Anyone who is looking to improve their
strategic thinking in order to make be�er
decisions within their profession—the MBA
skill set is applicable in any industry
On-campus, full-time, 2-year MBA program
Average Salary Ranges for Graduates of Full-Time MBA Programs
Forecasted growth in MBA hiring rates for 20147 16%
What Is the Value of an MBA?
The ROI of an MBA
