
Some business schools are shutting down their on-campus MBA programs - hhs
https://www.forbes.com/sites/poetsandquants/2019/05/26/why-business-schools-are-shutting-down-their-mba-programs/
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mcmoose75
I went to one of the top-tier (top 3) MBA programs in the US.

The way I've described that value of the top MBA programs is in 3 (roughly
equally-weighted) categories:

1) The Education: Getting to discuss business concepts with a group of smart,
successful folks for 6-9 hours a day is very helpful. Most of the content, I
could get from books/ online articles at a fraction of the price, but spending
the time in a focused way is actually helpful.

2) The Network: In terms of network, this isn't some vague amorphous thing at
Stanford GSB, HBS, or Penn- it's knowing several hundred other folks who are
going to be very successful in their careers. This can be useful in sales,
fundraising, finding a next job, etc. and DOES have a tangible dollar value.

3) The Rubber Stamp: Having your resume say "Stanford GSB" or "Harvard
Business School" does have value to future employers or customers- it de-risks
you as you've been validated by a famous institution, and helps THEM to
associate with these famous brands.

For the top 3 programs, even though they're VERY expensive (approx $250k in
tuition + living expenses, plus at least another $250k in foregone income for
most incoming students, for $500k in actual cost+opportunity cost), they're
almost certainly worth it.

For middle-/ lower-tier MBA programs, 2) and 3) above aren't NEARLY as
valuable, or perhaps don't even exist- is your "network" from Podunk State
School MBA actually valuable? For these, the only real value is the actual
education, and most students would be better served with an online program or
just actually picking up some books/ case studies/ reading online articles.

~~~
Scoundreller
> This can be useful in sales, fundraising, finding a next job, etc. and DOES
> have a tangible dollar value.

I believe you, but I haven’t seen any school websites actually advertise an a
dollar value on these human synergies.

If anyone would, you’d think it would be them.

~~~
lotsofpulp
That would be very gauche, and would net them negative PR from the overall
public due to laying bare the “it’s not what you know, it’s who know” mantra
for no reason. The people looking to attend these schools already know the
implied value.

~~~
Scoundreller
Sounds more like intangible value then.

~~~
0xDEFC0DE
You can probably establish a floor value but getting a good average/median is
going to be difficult because the top end is basically unlimited dollars for
yourself.

Taking a guess, a degree from a school listed should easily get a $100k salary
in any big city at minimum unless you've tanked your reputation very publicly
(like paying for your acceptance with bribes).

Most people who go to ivy league aren't really concerned about their safety
nets though.

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amb23
US MBA programs need to start following the European model: Year-long to 16
month programs tailored to a slightly older demographic (late 20s to 30s) who
actually need a degree to move a rung higher in their career. The shorter
program length will decrease the costs for students (both in terms of tuition
& opportunity costs) and--based on how much travel my friends currently
pursing MBAs do during the academic year--is unlikely to hurt academic
outcomes.

There are a few MBA ROI calculators online, and for my career I wouldn't see
an ROI until ~20-25 years down the line. (For context, I'd probably gain a
~30k salary increase if I were to pursue an MBA.) And that's with consistent
salary growth with no sabbaticals or career changes (and any subsequent loss
in earning potential) I might want to pursue. I would love to use a year long
program to gain some needed financial modeling, HR, and operational skills
while taking the time to pursue a business idea, but the traditional programs
are not structured to accommodate that. And besides, you don't actually need
an MBA if you work in the tech industry until you're in a senior position--VP
or C-suite--so there's no direct need for the degree itself until ~10-15 years
in the future.

~~~
jayalpha
"US MBA programs need to start following the European model"

No they don't. I, as a dual citizen, think US programs are by far superior.

"And besides, you don't actually need an MBA if you work in the tech industry"

"How to value your start-up? Add 1 Million for every engineer, subtract 500k
for every MBA" Guy Kawasaki

~~~
rchaud
The Guy Kawasaki quote is absurd when you consider that US startups bleed cash
all the way up to and often well past their IPO. You best believe that the
banks who are out there selling a fantastical vision of a startup's future
profitability have MBAs in their team. They're the ones making the engineers'
equity worth something.

~~~
ska
It's not so absurd - it doesn't imply you shouldn't have any MBA's, just that
the ratio to engineers should be very small at this stage. Which isn't wrong
in a tech startup.

Also, the banks don't really create value here, they preserve it if they can
and in the best case help people not piss it away. All for a handsome
percentage, but c'est la vie.

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rahimnathwani
The two existing comments are from people who are considering an MBA at some
point, so perhaps these thoughts are helpful:

\- Doing a full time MBA at a top school (or any school) is a large commitment
of time and money. If your aim is to start a business, then it's worth
considering what you could achieve with the same amount of time+money invested
in getting that business started. If your aim is to get a promotion then,
again, it's worth considering the opportunity cost.

\- Some of the things you'll learn during the MBA can easily be learned on
your own. But 90% of us usually only study the stuff we find most interesting
or most immediately relevant. An MBA is a good mechanism to force some
breadth.

\- The people who get most out of an MBA (from what I've saw at my school, and
other people I know) are those who have a clear goal, and have done some
research beforehand about how an MBA from their chosen school will help them
to get there. Those people also spent a significant portion of their time
researching jobs, and trying to meet people to get leads. They didn't just
focus on the classes until near graduation, and then apply via standard
processes. They were focused on their goal (e.g. 'M&A Associate position at a
top-tier investment bank') from the first day, until they got their job offer.

\- There are plenty of people who pursue a full-time MBA as a 'break' from
work, or because they want to learn a set of skills they can apply in their
existing or future business, or because their employer (e.g. investment bank,
or top-tier consulting firm) expects it and pays for it, or even just for fun.
These are all acceptable reasons. But pursuing an MBA because you think it's a
magic solution to $current_career_problem probably won't end well[0].

[0] This last part might be incorrect if you end up at a top school. Like,
maybe if you do an MBA at Harvard you won't even need to apply for jobs, and
people will come knocking on your door. I don't know. But I suspect the
intersection of people who (i) get into HBS, and (ii) have unrealistic
expectations of what a piece of paper can do for their career, is pretty
small.

~~~
dahart
> If your aim is to start a business, then it's worth considering what you
> could achieve with the same amount of time+money invested in getting that
> business started.

I’m not sure how to even begin evaluating opportunity cost.

I started a business, and had a successful exit, and I’m still considering the
MBA for the next time. The reasons include: as an engineering founder I
undervalued marketing dramatically and don’t know how to do it well, and I had
a hard time speaking the language of investors. I want to add skills to my
quiver that I found missing when I needed them.

How would you suggest thinking about opportunity cost, especially if you lack
experience in one or both options? In order to make starting a business more
valuable than school, I feel like you have to either be much luckier or know
what you’re doing and execute perfectly, which is incredibly hard to do the
first time. The things I spent time on as a first time founder are things I
think I would have learned not to do in business school. It worked out for me
only because I got lucky, but I did burn a few years and a lot of money. After
having chosen to start a business instead of school, I feel like it might have
been more efficient to go to school.

~~~
rahimnathwani
"I want to add skills to my quiver that I found missing when I needed them."

This is a really good reason. What are those skills? Would attending business
school help you build all/some of them?

"I’m not sure how to even begin evaluating opportunity cost."

If I were to give you $100k, on the condition that you spend the next 18-24
months doing only things that would help you build those skills, what would
you do with that time? Start a business? Take smart people out for dinner? Get
a job at a company you admire, and spend the cash on making your life more
comfortable? Sign up for a degree program?

~~~
dahart
Hmmm. If the goal of the $100k was to build the skills, I would include at
least some school. Taking smart people to dinner and working in successful
teams would also be on the list. The only thing I’d actively avoid is using
that cash for comfort.

But, building those skills may be far away from both knowing what skills I
need, and from executing, right? I guess that’s part of my question... the
answer to how to build those skills doesn’t necessarily have a lot of bearing
on whether it would be better to start a business or go to school. Aside from
what I might guess, how could I actually and meaningfully evaluate whether
going to school is a more valuable use of time than just launching into
another business? Maybe looking at rates of MBA founder success vs others is a
start...?

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vikramkr
Most of the value in an MBA is from the face to face interaction and
networking - the classes in business school are helpful sure but nothing you
can't learn yourself in a book. If these schools weren't able to offer much in
the way of networking and development of soft skills in the first place, then
frankly going online makes sense because you don't lose anything, but i think
that's a factor specific to these business schools, not the very top bschools
that have no shortage of funding/extensive networks etc.

~~~
povertyworld
Is it possible some corporations just have MBA requirements for advancement?
Then it doesn't matter where you got the degree from just that you have it. I
know this is the case in education, and has lead to the proliferation of
online education grad degrees. Since you just need the piece of paper, most
careerists optimize for the easiest online "mail order" type degree possible.
They don't, however, optimize for cheapest, since tax payers bankroll most of
these cheesy degrees through tuition reimbursement.

~~~
delfinom
MBA used to be an requirement for an engineer to jump into manager roles. But
nowadays it depends on the company.

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rchaud
You can see from the list of names in the article why those schools are
dropping on-campus programs. Some of them are prestigious institutions, but
not for business:

\- University of Iowa

\- Wake Forest University

\- Thunderbird School of Global Management

\- Virginia Tech

\- Simmons College

There aren't many people out there thinking, sure, I'll go into six-figure
debt so my LinkedIn can say I have a Simmons College MBA. Simply put, if your
on-campus MBA program isn't likely to result in a six-figure job right out of
the gate, it's not worth the cost.

And those six-figure jobs only come about if big, rich companies (banks, big 4
consulting/audit, big tech) come on campus to hire MBAs. If yours is not a Top
15 MBA program, you may be better off career-wise by staying at your current
job and pursuing professional certifications related to your field.

~~~
askafriend
I’d take it even further. If it’s not a top 5 program then you’d really really
have to think about if it’s worth doing at all.

~~~
joker3
Top five is a little too strict, but top twenty, yeah, maybe.

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bitL
IMO online MBA from a respected school is a perfect thing for entrepreneurs
that need flexibility and can't just take 2-3 years off. It's also awesome for
digital nomads that can literally earn degree while lying on a Hawaiian beach
or traveling around the world. And if the class is massive like at UIUC (2000
people?), networking effect gets a huge multiplier, globally, comparing to
much smaller classes at M7 (and FAANG is quite strongly represented there,
like with Georgia Tech's OMS CS). The only problem I see is prestige, so I'll
keep an eye on iMBA to see how they wrestle with rankings.

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_sword
Interestingly, institutions such as Simmons (highlighted in this article) are
partnering with online education platform vendors such as 2u to bring their
campus online. Using 2u as an example, the schools offload all of the
marketing for candidates, managing the online platform, and more to 2u in
exchange for a revenue share for tuition for online students. Schools are in
turn responsible for the course content including the professors, and for
their admissions department to accept or deny applications provided by 2u. The
net impact for the school can be incremental revenues by addressing students
that weren't accessible previously, and that these incremental revenues come
with a high margin for the school, which can help fund other areas of the
school. Fascinating business model in my view.

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miohtama
Online MBA would be only for career signalling? Is the other side of the coin,
networking, present in any form? Has anyone taken online MBA and can comment
the benefits?

~~~
Ibethewalrus
Interested as well about the benefits/downsides of an online MBA by a
prestigious vs regular school

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baron816
Is there a lot of value in getting a non-specialized MBA if you're working in
tech (or want to work in tech)?

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SQL2219
There are 16 references in the comments about "top" programs. I am curious as
to what top actually means, can I sort by the top column in a spreadsheet? Is
it a code word for cost?

~~~
filmgirlcw
It means Harvard, MIT, Stanford, University of Chicago, Penn — most generally.

But there are different MBA programs. There’s the traditional MBA, the part-
time MBA (which is a great choice for people who already work), and the
executive MBA.

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RickJWagner
Anything that adds prestige and profitibility to online education is ok with
me.

Traditional college education is a racket. I'm hoping online is the way of the
(near) future.

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dahart
Tl;dr on-campus programs are in decline while online programs are growing.
Seems like the title is a tad misleading, the programs aren’t shutting down,
they’re going online.

But isn’t a lot of the value of an MBA in the face time and networking you get
during the program? (Or is that a myth or only something that happens at
Harvard?) Every once in a while I think about going back and getting an MBA,
speculating it might help with my next startup, but I’ve always imagined going
to campus. Are online tools and online degrees improving in the areas of
having class discussions and making friends and asking questions and general
people time?

~~~
lotsofpulp
It’s not a myth, top MBA programs are top because they give you access to an
exclusive network. Personally, I wouldn’t value an MBA much without that
aspect.

