If you don't do the right MBA, then you might as well be burning money

Timothy Barber
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LIKE so many other sectors in the wake of the credit crunch and recession, higher education has been having a &ldquo;stop and think&rdquo; moment. Once seen as the suppliers of the business talent &ndash; and particularly the banking talent &ndash; that fuelled the economic boom years, business schools are having to re-affirm the value of their teaching in a changing world, and even display an element of humility in the face of accusations that they directly influenced the recklessness that brought about the crash.<br /><br />Nowhere has this been more clearly in evidence than at Harvard Business School, where this year&rsquo;s crop of graduating MBA students have been lining up to swear an oath &ndash; drawn up by students &ndash;&nbsp;to &ldquo;serve the greater good&rdquo;. Students at some other schools &ndash; including at Oxford University&rsquo;s Said Business School &ndash; have followed suit.<br /><br />So does holding a Masters in Business Administration degree still retain the same cache it did? Even before the recession, there were those who had lost faith with the MBA qualification, largely because of its increasing ubiquity.<br /><br />Once a relatively rare qualification pursued by the most able executives, who were able both to put aside a year or two from their careers to study and find the considerable amounts needed to fund it, over the past decade the number of schools offering the qualification has massively increased. The result, say some, is that the over-all MBA brand has become diluted.<br /><br />&ldquo;I think there have been two problems,&rdquo; says Sean Rickard, director of Cranfield School of Management&rsquo;s full time MBA programme. &ldquo;Traditionally, the MBA programme was a post-experience qualification as opposed to post-graduate. Over recent years, many schools have been taking much younger students, treating it more like a post-graduate masters, and that has tended to devalue it.&rdquo;<br /><strong><br />ALL-ROUND QUALIFICATION</strong><br />The other problem, Rickard says, is that too many schools are offering MBAs with specialisations, for instance in marketing or entrepreneurship, further reducing the impact of what should be an all-round managerial qualification.<br /><br />&ldquo;It&rsquo;s really time we got back to basics,&rdquo; he says, &ldquo;and got back to older graduates.&rdquo;<br /><br />The key reason to do an MBA has been the amount that it increases your salary. But that may no longer be the case. According to Belinda Walmsley, associate director of City recruitment firm Joslin Rowe, some of those graduating this summer or in a year&rsquo;s time may be in for a shock.<br /><br />&ldquo;In the current job market, we&rsquo;re witnessing lots of experienced and well-paid people moving their horizons, even to the extent of someone who had been earning &pound;120,000 before being made redundant, now looking for jobs of around &pound;95,000. So as someone who has just done an MBA you may be up against people who did it two or three years ago and have extra experience. Everyone is moving down the food chain a bit and encroaching on each other&rsquo;s natural territory.&rdquo;<br /><br />There&rsquo;s also the issue of the value of study versus experience. While many will have seen the stagnation of the job market as a prime opportunity to take the time out to do an MBA, particularly those who have been able to use redundancy payouts to fund them, will they really have an advantage over those who kept their jobs and stuck through the hard times?<br /><br />&ldquo;If you&rsquo;ve got experience of steering a business through the recession, or there were mass redundancies and you avoided them, that could stand you in better stead than going off to business school,&rdquo; says Adam Nicoll of recruiters GRS Group. &ldquo;It&rsquo;s still a valuable tool, but where you get it from is absolutely key. If it&rsquo;s from one of the top-ranking business schools, it could be the thing that makes you stand apart.&rdquo;<br /><br />Sarah Williams, operations director of financial recruitment company FSS says: &ldquo;The market is saturated with candidates and any qualification that can assist a potential employer in assessing them is helpful. An MBA is certainly top of this list. Also, the current market is awash with mergers and takeovers or at the very least businesses looking to realign themselves in response to the changes in market conditions. This inevitably leads to the full-scale restructuring of businesses. Such projects require complete business analysis, review and realignment. Candidates in possession of the higher level analytical and scenario-based decision making skill set that an MBA procures are very attractive employees at this time.&rdquo;<br /><br /><strong>POWERFUL QUALIFICATION</strong><br />An MBA is still an extremely powerful qualification to have on one&rsquo;s CV, then, on the proviso that it enhances rather than replaces experience, and that it comes from one of the top-ranked business schools. After all, acceptance onto one of these programmes is a considerable achievement and demonstration of aptitude in itself. Nevertheless, as the Harvard graduates&rsquo; determination to promote an ethically responsible approach to business reflects, even the leading schools must commit to a change in attitudes.<br /><br />&ldquo;There&rsquo;s going to be more emphasis on ethics, integrity and the idea that this is about more than just creating wealth and self-aggrandisement,&rdquo; says Sean Rickard of Cranfield School of Management, where corporate responsibility is now being embedded into every concept covered, rather than being addressed as a standalone module. After all, he says, business schools will be the incubators of the theories and thinking that will enable more responsible business practices in the future &ndash; and the next generation of MBA students will be the ones to put new ideas into practice.<br /><br />&ldquo;It&rsquo;s unfortunate that the schools weren&rsquo;t in the vanguard of raising concerns about what was going on, rather than feeding it,&rdquo; he says. &ldquo;I think there&rsquo;s a recognition that we have got to think more carefully in the future about how we approach these issues. It can&rsquo;t just be that a large salary is the only thing, it&rsquo;s about how you get there, the relationships involved, what you leave behind.&rdquo;