Your education can have business benefits too
A MASTERS in Business Administration (MBA) doesn’t come cheap. Tuition fees at top business schools can easily exceed £50,000, leaving a considerable dent in your back pocket. Getting financial support from your employer, therefore, could be a smart move.
On the whole, there has been a downward trend in the proportion of students receiving employer funding, falling from 12.6 per cent in 2011 to 9.5 per cent in 2012, according to data from TopMBA.
But many businesses are still willing to support students studying at the top schools. Recent sponsors of executive MBA students at London Business School include Apple, Citi, HSBC and Royal Dutch Shell. Steve Cousins, recruitment and admissions manager for the MBA programme at Cass Business School, says that corporate student sponsorship at the school has remained consistent – “although the process students must go through does appear to have become tougher, and takes a bit longer”.
The likelihood of receiving employer funding varies depending on the type of course taken. Data from GMAC shows that students enrolled in distance programmes are the most likely to receive company support, with 71 per cent of online MBA providers expecting over 40 per cent of their incoming class to be fully or partially funded. This drops to 49 per cent for executive MBA providers, 45 per cent for part-time MBAs, and eight per cent for full-time one-year programmes.
Before preparing your proposition, find out if your employer has a formal sponsorship policy in place. The process should be more straightforward if there is a precedent, but prepare to get proactive if there’s not.
Establish who will be receiving your proposal. It may be a human resources executive, your line manager, or even the chief executive, so tailor the business case as appropriate.
Determine how your choice of programme and school fits in with the needs of the business and your own career. Work out what level of commitment you would ask from your employer, and the level of commitment you’d be prepared to give in return.
Support doesn’t have to be financial. Chi Hang John Ho, manager of performance and capacity at Ericsson UK, decided to pursue an executive MBA at ESCP Europe Business School in the middle of 2010. Realising he was unlikely to receive help with his fees, he went for the next best thing: study leave. “Because no money changed hands, it was a lot easier for my boss to say yes,” says Ho. “I also offered to share what I’d learnt in class with colleagues, which might also be why the company didn’t formally ask for anything in return.”
Other forms of support you could ask for include partial funding or maintenance costs, flexible working, or project work to apply your newly acquired knowledge to different areas of the business.
You may also ask for a salary sacrifice, whereby your employer cuts your salary at the level of the fees and pays them directly to the school. As a result, you’d pay no tax or national insurance on the sacrificed amount, and your employer can avoid paying national insurance on this part of your salary.
When submitting your application, it’s advisable to plan ahead. Dr Patrick Gougeon, UK director at ESCP Europe Business School, says companies with formal policies may take applications on a first come first serve basis. “But if there’s no formal policy, and the final decision depends solely on your line manager, seize the opportunity whenever you think you’re in a good position to ask,” he says. Remember, however, that smaller companies may need to set aside funds in their annual budget, so make your request well ahead of admission deadlines to be safe.
Current students may also be able to secure some retrospective funding. Louis-David Rouyer, vice president and senior corporate cash management consultant at Societe Generale, requested sponsorship for his executive MBA midway through the course, and negotiations didn’t begin until he had nearly finished. Rouyer decided to ask for help during a move from SocGen’s Paris office to London while studying. “In exchange for my commitment to stay with the bank for two years, SocGen agreed to pay part of the fees,” Rouyer says.
When outlining your business case, start with your proposal and work backwards. Ho summarises his proposition to Ericsson: “I began by telling them which school I was applying to, its strengths, the type of people studying there, the subjects I would take, and how I could benefit. I then sold them the idea that I would bring back and apply what I’d learnt on the job to improve business performance – particularly in budget control, negotiation, client relationship management, and managing international teams.”
Essentially, your proposal needs to persuade the decision makers that funding your education would be a good long-term investment for the business. Picking out how specific elements of the course or school you’ve chosen could have concrete benefits for the company is a good way of giving your application some firepower. For example, if the course involves an international assignment to a location your employer wants to expand into in the future, mention how this could be of use.
There may be downsides to sponsorship, particularly if you’re obliged to sign a contract to continue working with the same employer. Cousins says that, “if you envisage yourself working in a different sector or organisation after your MBA, it may not be appropriate to ask for financial support”. Even if you have no plans to move jobs now, this may change while on the course, and it may be frustrating returning to your old post.
Being sponsored also means you’ll miss out on taking full advantage of on-campus recruiting: one of the main attractions of top schools. Talking to other employers while on a sponsored MBA course can throw up a red flag, as it suggests a lack of loyalty.
NEGOTIATE A PROMOTION
In addition, signing a contract means your employer doesn’t have to entice you back with a post-MBA salary boost or promotion. This could, of course, be tied in with the deal. “In hindsight,” Ho says, “I would have discussed with the company how I could be promoted post-MBA before applying”. But he adds that the skills learnt on the MBA contributed to his advancing to his current position anyway.
It’s worth taking into account other forms of funding open to you. The proportion of students receiving MBA scholarships rose from 52 per cent to 57.7 per cent between 2011 and 2012, according to TopMBA. Many eligible candidates miss out on these due to a lack of research. But there’s a wide variety out there – based on financial need or academic merit, for female students, for students with disabilities, or entrepreneurs, to name a few.