What is an MBA and when does it make sense to get one?

BY Jordan FriedmanApril 24, 2021, 10:32 am
PHOTO ILLUSTRATION BY Martin Laksman

What do Sheryl Sandberg, Tim Cook, and Jamie Dimon have in common? Yes, they’re all respected business leaders in their industries (at Facebook, Apple, and JPMorgan Chase, respectively), and yes, their work has changed the world. When it comes to their education, they also all earned MBA degrees. 

Furthering your education is one way to get ahead in your career, and the master of business administration, or MBA, is one option. So, should you get an MBA? To make that decision, you first need to understand the degree and what it entails, and then assess your career goals.

What is an MBA?

The MBA is the internationally recognized graduate-level credential in business leadership and management and can help you advance in your current industry or change fields. Many C-suite executives and entrepreneurs hold MBAs.

An MBA prepares degree holders to lead, start, invest in, and/or advise organizations—usually for-profit businesses but sometimes not-for-profit entities, says Linda Abraham, founder of Accepted, an admissions consulting firm for prospective college and graduate students.

This credential was historically viewed as a general business degree, and by and large that hasn’t changed, says Brian Cameron, associate dean for professional graduate programs at the Smeal College of Business at Pennsylvania State University. But, he adds, “today there are many different types and flavors of MBAs.”

Programs now vary in course format (for example, on-campus vs. online) and structure (part-time vs. full-time), when (and where) students take classes, the types of courses they take, program length, and cost.

Curriculum

MBA students may learn on a school’s campus, online, or a combination of both. Online students, who more often study part-time, can complete their coursework remotely but may still attend live virtual lectures or occasional in-person residencies.

Most MBA programs have a core curriculum focusing on business fundamentals, in which students study leadership, accounting, economics, finance, marketing, and operations, Abraham says. MBA students typically also enroll in electives.

“They can choose to dive deep into a specific area of business, or they can choose to stay more general,” says Abraham, who founded Accepted in 1994. The types of electives students take will depend largely on whether they pursue an area of concentration, like marketing or business analytics, or continue with a broader management education.

Especially in full-time MBA programs, networking is integral to the student experience, opening doors to potential career opportunities. Students may also be able to complete internships, study overseas, and attend career fairs.

How long MBAs take

In a full-time MBA program, the credit hour requirements, which vary among schools, translate to about two years of study. However, some schools offer accelerated one-year options. 

The lengths of part-time programs—generally geared toward working professionals—vary depending on the number of courses you take each semester or quarter. But these programs may allow students several years to complete the requirements. Executive MBAs, which attract more experienced professionals, can take roughly two years to complete.

Career paths

With an MBA, you may plan to advance into a managerial role in your field either at your current employer or elsewhere, which could lead to a salary increase. Or you may view the MBA as a way to make a major career change.

The MBA is also a good option for people looking to change from being a functional expert—say, an engineer—to a broader organizational leader, says Janice Kennedy, executive director of recruiting and admissions at the Jones Graduate School of Business at Rice University.

“Different aspects of a person’s career stage and long-term aspirations are all considerations in ‘why an MBA?’” Kennedy says.

While MBA graduates hold jobs spanning industries, the most common post-graduation fields include consulting, tech, and finance, Abraham says. Smaller numbers of students enter real estate, consumer goods, health care, entrepreneurship, and media and entertainment.

Admission requirements

To apply to an MBA program, you may need to submit your résumé, past academic transcripts, essays, and recommendation letters. MBA applicants may be invited for in-person interviews with admissions staff.

MBA programs may also require either GRE or GMAT standardized test scores; however, there are some test-optional programs.

Should you get an MBA?

Experts say deciding whether to pursue an MBA comes down to a few key factors.

Your career goals

First, determine what you want to get out of your education and degree, Abraham says. Your desired outcome usually ties back to your career goals.

“[A career plan] really becomes the north star in guiding [students] as to whether the degree is worth the effort and cost,” Abraham says. It’s important to have solid reasoning for pursuing the MBA, she adds.

How do you know whether an MBA will get you where you want to go? Start by researching different career paths online and consulting with admissions staff at schools of interest. Contact MBA students and alumni and ask them about their experience and whether it has been worthwhile from a career perspective.

You may also speak with professionals who hold positions you find appealing. Abraham recommends asking these people what they do every day, what they like (and dislike) about their job, and what education is valuable in their field.

Your career goals will also impact the type of MBA program you pick. You may check whether there are programs that offer specializations tied to your job aspirations, for instance.

How the MBA fits into your life

An MBA represents a significant investment of time and money, so make sure it’s the right time for you to take this journey, Kennedy says.

“Is it the right time for me and my family, if I have one?” Kennedy says. “Is it the right time for me and my career? Is it the right time for me financially?”

You should also assess how you envision the MBA factoring into your life. If you want to continue working and earning a salary while pursuing the degree, you may consider a part-time or online program. If you want to make school and networking a full-time endeavor, consider a full-time MBA.

“It’s a mixed bag of what you want to do and if you want to get an MBA but how you want to get the MBA, as well,” Kennedy says.

Your return on investment

Another way to decide whether to get an MBA? Calculate your return on investment, or ROI, by looking into your potential salary post-graduation and how much you’ll spend paying for the program. How long might it take to pay off your debt and see a positive ROI? Factor in not only tuition costs but also charges associated with on-campus living, books, and other fees.

Many schools have resources to help applicants calculate the ROI on their MBA. This process will look different for full-time students—who generally don’t continue earning a salary while getting their MBA—versus part-time or executive MBA students. Whether your employer will pay your tuition is another important question.

“For the people that don’t quit their jobs, I think it’s an easier decision,” Cameron says. Especially when employers are covering tuition, whether to get an MBA becomes more of a question of time than lost income.

Making your final decision

You don’t have to go through this process alone. Confer with admissions staff, academic advisers, and career personnel at schools you are considering applying to about your professional goals and whether an MBA would be a good fit. Get opinions not just from trusted professionals in your field but also family, friends, and colleagues you know well. 

When looking at programs, look beyond just the academics. Research the types of jobs MBA graduates at different schools get and if they’re the types of positions you’re looking for.

And when weighing the pros and cons, don’t forget about the nonfinancial benefits of getting an MBA, experts say—an opportunity to learn more about your interests, develop a strong professional network, and gain a broader understanding of leadership, to name just a few.

“Without ignoring or diminishing the financial benefit and cost, that nonfinancial part should also be part of the equation,” Abraham says.