What’s an MBA worth to former B-school grads?

BY Mary LowengardJuly 16, 2021, 2:00 AM
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A couple of days before I showed up for orientation at what was then the Graduate School of Management at the University of California at Los Angeles (today, the UCLA Anderson School of Management), The Christian Science Monitor published an article titled, “What’s the Worth of an MBA?” It warned that following “a raging bull market for business schools,” a correction was on the horizon, thanks to increases in tuition, fewer women enrollees, and a decline in students sitting for the Graduate Management Admission Test (GMAT).

I wondered if B-school was a terrible, terrible mistake. To be honest, I was also petrified about the upcoming calculus exemption test I faced in a few days. The article cited tuition costs of $21,000 plus the “opportunity cost” (a phrase I would learn all about in a few weeks) of being out of the workforce for 20 months, as well. UCLA, still a “public school” when I attended, was cheaper, but I offset that by being one of the few who distinguished themselves by not having a job offer by graduation. In fact, I wasn’t employed full-time until the end of the following February.

What’s the worth of an MBA, and is it worth it?

I posed the question of “the worth of an MBA” to a cohort who attended full-time business programs between 1977 and 1990. Schools represented included Harvard, Cornell, Wharton, and the University of Virginia. I asked: Would these MBA grads still opt to attend business school even at today’s sticker price?

All but two in the group said yes, even at a price tag that makes their first-time-round tuition outlays seem like loose change.

Deep context and diverse points of view

There were resounding yeses from all four Harvard Business School graduates in the cohort, whose graduation dates spanned 1979 to 1990. Wally Gonzalez, who earned his MBA in 1985, points out that anyone can look up anything on the Internet but that cannot replace his experience in the classroom in Cambridge. His take on the degree’s value? “The MBA program provides deeper context and diverse points of reference. You develop a wider and more comprehensive view of a problem and how to make quick decisions based on limited information.”

Gonzalez adds that he acquired insights and learned how to “read” people in ways that benefited him throughout his career as a banker and business adviser in his native Puerto Rico, where he returned after receiving his MBA.

The numbers still work, and the experience was A+

Phil Leffel, a South Carolina–based real estate investor, preceded Gonzalez at Harvard by six years and is another solid yes on the question of the worth of an MBA. “The degree is a growth experience; the numbers still work, and the alumni network is an amazing resource,” he explains. By Leffel’s calculation, in 1979, starting salaries were $25,000 to $35,000. These have increased now by a factor of five, and tuition has gone up only by a factor of three  to four.

Harvard Business School class of 1984 graduate Bruce Maier recalls that he underestimated the consequences of being older and more experienced than his classmates when he aspired to transition into a job in financial services. Prior to arriving at B-school, Maier had worked for several years after graduating from Tufts University with an engineering degree. But his time at Harvard was unquestionably valuable in his subsequent career in manufacturing. “I have no complaints,” Maier says.

The Ivy luster

Rick Hood arrived at Harvard in 1988 after completing his undergraduate degree at Brown and following a successful 15-year career as a ballet performer, an unusual (even surprising) background. “I saw business school as an insurance policy and decided if I get in, I’ll go,” Hood explains. The only downside to HBS, he recalls, is that when employers saw his double-Ivy pedigree, they placed “great expectations” on him that, at times, he wondered if he could fulfill. Still, Hood says, “business school opened doors that never would have been an option for me. I was turning 40 in a few years, and I’m grateful for the opportunities it gave me and for what I learned.” 

Others, like 1982 Wharton grad Barbara Keith Rosengren, say the MBA was worth it—but with conditions. “You really should set your sights on a name school and have a clear career goal in mind,” she advises. 

Karen Bradley, of the Wharton class of 1980, likewise suggests where you go is critical to the decision. “Invest in a top-tier school; it will always come back to you,” she notes. For Bradley, the MBA program was “invigorating intellectually and stimulating,” though initially somewhat alien as she came to it as a biology/psychology major from her undergraduate days at Tufts. Meanwhile, she earned a DMD degree in dentistry along with the MBA, an unusual combination. Upon graduating, Bradley opted to work in clinical practice and academia rather than go into health care consulting, but has leaned on her B-school learnings throughout her career, she says.

Doubling down with the JD/MBA

Mike Lederman received a JD/MBA from the University of Virginia in 1980. (In my day, my classmates joked that this degree was a “license to print money.”) He spent six years at white-shoe law firms, then transitioned into business and investing. “I would surely do it all over again,” Lederman says.

Still, at times Lederman found it necessary to confirm to other attorneys that he was sufficiently committed to the craft of lawyering and to business colleagues that his perspective was not unduly influenced by the legal profession’s inclination to minimize risk taking. But he asserts firmly that “it was worth it for the career skills and flexibility inherent in possessing both degrees, and I made great use of that flexibility.”

Another member of the cohort, Rick Otis set his sights on a master of public administration at Cornell Graduate School of Business and Public Administration (today the S.C. Johnson Graduate School of Management). But soon after starting, he transferred to the business program, going for the “more marketable MBA.” Landing in Washington D.C., he quickly realized the MBA was considerably overshadowed by a proliferation of law degrees. Given the choice today, based admittedly on Monday morning quarterbacking, Otis says he would opt for a JD/MBA instead.

Don’t try this at B-school

As for me? I really can’t fathom pursuing an MBA at today’s sticker price. Graduating from college in the Watergate era, I was only dimly aware that something like an MBA existed. My gang wanted to be crusading lawyers or journalists. When I heard Mike Lederman, my high-school buddy, was getting a JD/MBA, I thought, “Why?”

Once I “discovered” business school and what it might offer, I applied with the antiquated 1970s notion that I would use the experience to “find myself.” I was so totally out of it that in the class of 1986 facebook (yes, that’s what it was called), I am the only one wearing a T-shirt among the 422 men in jackets and ties and women in crisp white shirts and blazers.

I loved my time at business school—Southern California is a great place to take two years off—but I didn’t know any more about what I wanted to do the day I graduated than I did the day I walked in the door. Because I was older than most classmates, I wasn’t exactly catnip to recruiters who thought I was either over the hill (at 32) or, worse, too opinionated.

It was fun while it lasted

Indeed, I was strong headed. I graduated without a job, and returned to New York City where, nine months later, I found a position with a Wall Street financial services company through a personal connection—my mother! Exactly 366 days later, I walked out. And that was the last job that required the training the MBA offered me.

By the way, I passed the calculus exemption test, scraping through with 10 out of 13 correct answers. I still have the card recording my score.