Real Returns on Investment

Read about the many ways in which the MBA degree can yield real returns on investment.

The examples are many: The project of an Executive MBA study group turns into a thriving business for one of its members. Fresh from a discussion with a faculty member, another Executive MBA student successfully resolves a costly inventory problem. Each day throughout the world, Executive MBA students and alumni assume greater responsibilities and promotions as they apply their new knowledge and skills to make a difference for their organizations.

The Executive MBA is a degree that offers real returns for its students and their organizations. The gain for business leaders comes in many forms: the ability to analyze complex situations and make tough decisions; deepened understanding of all business functions; increased confidence to lead a team and to take on additional responsibilities; access to the latest in innovation, ideas, and approaches; global vision; and expanded professional networks.

The gain for companies is equally as powerful. Executive MBA programs are assets to organizations because they offer the knowledge and tools that participants need to become complete business leaders who can contribute significantly to their organizations.

Enviable ROI

Statistics support the stories that Executive MBA students and alumni share about the impact of the degree. The Executive MBA Council, an association of more than 200 members colleges and universities worldwide that offer more than 300 programs in 25 counties, sponsors research that tracks student satisfaction and industry trends.

Three-quarters of Executive MBA students who took part in the Executive MBA Council 2008 Student Exit Benchmarking Survey say they greatly increased their value to their organization as a result of their Executive MBA education.

The survey provides data about the perceptions and opinions of Executive MBA program graduates and helps measure the return on investment (ROI) of the degree. It included more than 3,800 students from more than 120 programs and shows the powerful impact of the degree in several ways.

For example, almost all students in the survey – 97 per cent – say the program met or exceeded their expectations for impact on their career. Almost all students – 98 per cent – also say the program met or exceeded their expectations for impact on their organization.

Students noted significant gains in all areas of professional development measured, with the largest improvements in business discipline integration, critical thinking, decision-making, global sensitivity, leadership, and teambuilding.

More dividends

The knowledge and skills that students gain from the program translate into tangible dividends for business leaders who complete the degree. Students in the survey also reported the following impacts on their career:

- Sixty-seven per cent of students say the program greatly increased their ability to be promoted.

- In addition, 39 per cent reported expecting a promotion and 43 per cent actually received a promotion while in the program.

- Students also reported a 23 per cent increase in salary from entering to leaving the program, with an entering salary mean of $117,617 and a salary mean when leaving of $144,361.

Targeted focus

The Executive MBA Program attracts a talented and diverse range of business leaders, who enter the program with about 13 years of work experience and eight years of management experience. What makes Executive MBA education a distinctive option for business leaders?

The Executive MBA offers the same foundation and rigor as any MBA degree, but includes the added benefits of an attractive format and a built-in network of experienced business leaders. Executive MBA programs share some common characteristics:

- They are designed to meet the educational needs of business leaders from all types of industries.

- Their format makes it possible for such leaders to earn their MBA in two years or less while continuing to work full time, and program services allow students to concentrate on their studies.

- Generally, business leaders enter the program, complete classes, and graduate with the same group of students, giving participants the unique opportunity to meet and learn from each other.

- Taught by senior faculty members, the curriculum covers and integrates all functional areas. Core business knowledge and more Executive MBA programs continue to spend a significant amount of time on core business functions, but increasingly, they are also investing more course time on skill development in other areas that are important to business. As part of the council's annual Membership Program Survey, which offers a comprehensive overview of worldwide programs, programs reported on the number of required in-class hours. Core functional areas topped the list; the numbers reflect actual 60-minute hours:

- Finance (56.2 hours)
- Accounting (48.6)
- International Business (44.5)
- Strategic Business Policy (44.3)
- Marketing (44.2)
- Economics (43.5)

To bolster leadership abilities, many Executive MBA Programs are increasing their focus on strategy and leadership and on higher management functions, as well as improving communication skills. Survey results reinforce that commitment: • Class hours that were dedicated to leadership rose 64 per cent, from 21.9, 60-minute class hours in 2002 to 36 in 2008.

- Class hours that were dedicated to entrepreneurship rose 105 per cent, from 10.7, 60-minute class hours in 2002 to 21.9 in 2008.

- Class hours that were dedicated to ethics rose 124 per cent, from 8.9, 60-minute class hours in 2002 to 20 in 2008.

- Class hours that were dedicated to communications rose 81 per cent, from 10.8, 60-minute class hours in 2002 to 19.6 in 2008.

- Class hours that were dedicated to professional development rose 183 per cent, from 9.3, 60-minute class hours in 2002 to 26.3 in 2008.

Programs will continue to integrate their curriculums to ensure that students not only understand functional areas, such as finance and marketing, but the ways in which functional areas combine to strengthen an organization's competitive position. The changing focus of programs will remain consistent in one goal: to offer the knowledge and tools that participants need to become complete business leaders.

About the Author

Michael Desiderio joined the Executive MBA Council as executive director in 2007. He oversees council operations and services and council collaborations with related educational associations and organizations throughout the world. He has been in industry in various positions that range from engineering through executive management and most recently served as director of strategic partnerships for the W. P. Carey School of Business at Arizona State University. Desiderio received his Executive MBA degree in 2001 from the W. P. Cary School at Arizona State University.

About The Executive MBA Council (EMBAC)

The Executive MBA Council fosters excellence and innovation worldwide in Executive MBA Programs. The Executive MBA Council web site at www.embac.org includes a Visitor Search, a directory of Executive MBA Programs with complete program  descriptions including: start dates, class times, international requirements, program length, application fees, total program cost, accreditation, undergraduate requirements, minimum work and management experience, and contact information.