An MBA can deliver a robust return on investment for graduates. Students who earn an MBA can more-than double their salary potential, bringing home well over twice the amount of the average starting salary for college graduates in the U.S.—which is about $55,000, according to the National Association of College and Employers.
The value of the MBA, according to a dean at Washington University’s Olin Business SchoolBY Sydney LakeAugust 18, 2022, 1:06 PM
In 2022, MBA graduates brought home $115,000 starting pay packages on average, according to the Graduate Management Admissions Council. That doesn’t even include the whopping bonuses that many top business school graduates rake in, as well. For example, class of 2021 students at Washington University in St. Louis’ Olin Business School took home median base salaries of $118,000 and median signing bonuses of $25,000. Fortune ranks Olin as having one of the best part-time MBA programs in the U.S.
While a major pay bump is the prize at the end of a years-long venture (think application process plus actually earning the degree), there are many factors to consider ahead of committing to an MBA program: location, modality, specializations. The list goes on.
Fortune sat down with Andrew Knight, a professor of organizational behavior and vice dean for education and globalization at Washington University in St. Louis’ Olin Business School. As vice dean for education and globalization, Knight oversees the Olin Business School’s degree programs. Here’s what he told us about the top considerations prospective MBA students should be making ahead of the application process, and the value of this degree.
The following interview has been edited for brevity and clarity.
Is an MBA a good investment?
Fortune: How can a prospective MBA student tell if earning a master’s degree is the right investment?
Knight: Some people are looking to make that investment because they already know they’re passionate about a particular functional area or a particular organization. They are very much interested in advancing and accelerating their careers—or deepening their skill set, whether that’s in the soft side of things like leadership and building teams, or on the harder side and some deeper technical and more functional skill sets.
A second common reason why people pursue an MBA is because they’re pivoting. Right now, especially, there are lots of people who are actively pivoting in their lives and in their careers, as they’ve gone through the disruption of COVID. In partnership with the Great Resignation, we’re seeing people go through that thought process. The MBA can be a very helpful degree—a wise return to engaging in structured and systematic reflection for formulating next steps.
The third place that usually is underlying each of those are people who are naturally curious. They identify places where they have some gaps and they’re looking for a really high-quality and often high-touch educational experience for helping them learn about things that they’re curious about and want to explore.
There’s speculation of an impending recession. Is now still a good time to get an MBA?
For many people who are actively taking positions right now that are either fully remote or hybrid, this is a period of time where they’re engaging in a full-time, presumably less impacted by pandemic work experience. On the resignation side where people are moving and often taking positions that are virtual or fully virtual or hybrid, I think people’s preferences still need to shake out.
We’re going to see in the market, preferences shaking out as people discover that maybe the grass wasn’t so green on the other side, and they have a hunger to return to a more fully in-person workplace. And so all that’s to say is, I think we will continue to see volatility.
Then when we add the potential of an economic disruption and a recession or a tightening of the labor market—and you see that churn start to happen—I do believe that for those same reasons that I articulated earlier, an MBA program with a high-quality university is in some ways a wonderful place to return to a home base, to come back either to accelerate your career and have a better sense of where you’re trying to pivot next, or engage in more of that intrinsic love of learning.
Top considerations for earning an MBA
How should MBA prospects weigh in-person and online program options?
This is such an important question in an era where there are more options than ever for engaging in an MBA program. Those are the traditional full-time model; the part-time model; the flex model, and there’s a fully online degree. Then we have the executive-level degrees. But also increasingly, people are hungry for some kind of flexibility introduced by virtual learning.
That’s where returning very much to some deep introspection is important. Ask yourself: What is it that I’m hoping to to realize? What value am I seeking with this investment of my time? What are my financial resources? My energy? My motivation? Are you looking for a love of learning? Are you looking primarily for career advancement in a known space, or are you looking for a bit more of a career pivot? Sometimes aspects of the program will benefit you in different ways for each of those.
What about networking?
One key source of value from an MBA program is an expansion and deepening of your professional network. For many full-time MBA programs, in particular, we really do focus on the relationships that people build. The full-time MBA often offers a dramatic acceleration and deepening of people’s professional networks.
If you’re looking to broaden and deepen your professional network and you’re in a later stage, I would advise and counsel more toward the executive MBA side of the house. Now, if you have a really good sense of what you want to learn and you are fairly secure and confident in the current career path that you’re pursuing, and you don’t want to give up your full-time job and other commitments, I think those are places where the models that focus on providing flexibility while still providing a really high quality educational experience.
That’s where those models shine. Fully online models increasingly provide all of that. They provide a high-quality educational experience that is increasingly more immersive, that allows people to still build really great relationships with one another—but they maximize on the flexibility side of things.
Who should consider a specialized master’s program over an MBA program?
Specialized master’s offer two sources of value for people. Number one, for the people that know they want to go deep and they know they want to be the go-to people, analytics experts in their organization.
It provides the ability for those in our MBA programs to actually level up their technical skills, to be able to converse with those individuals who will be working alongside them that have really deep technical knowledge. The presence of those programs under the same house enables all students to benefit. Similarly, our analytics-focused people now are in the same room and thinking more carefully about how they communicate the data that they’ve analyzed.
What’s next for the MBA
What are the most applicable skills MBAs are learning now?
Teamwork collaboration is not going anywhere. In fact, the data that we see from employers specifically calls out that as they accelerate on the technical side. As we specialize and we have a differentiation of expertise, we’ve got to have people who are skilled at bringing things together. That same classic cluster of skills and expertise that’s always been the bread and butter of an MBA program—leadership, collaboration, teamwork, motivation—that will always be a steady core.
Another area I think is very much rising in importance is technical expertise with respect to technology. We need people who are really at the cutting edge of new technology, who are able to make decisions about what to use and implement and what not to use and implement—and and be able to actually lead organizations to live at the frontier.
The last piece that I think actually is linked to that is the increasing need for leaders to enhance themselves in making decisions that are grounded in core values—that they’re not just simply responding to the last data point that was in front of them, but that there is a core underlying stability.
What’s missing from the MBA curriculum?
We underwent a pretty significant overhaul of our required curriculum back in 2019. The major piece of that overhaul was that we introduced a multi-course, multi-country global immersion for our full-time MBA students right at the front end of their program. What that means is that the students engage in some coursework in St. Louis, then they travel to Washington D.C., where we have a partnership with the Brookings Institution and they take a course focused on the intersection of business and government and society.
Then they travel to Barcelona currently where they take two focused courses that are highly experiential—that are designed to rapidly accelerate students with respect to their business fluency and, at the same time, really supercharge the development of their relationships with one another. After that, they travel to Santiago, Chile, where they do a course that’s focused on global operations and understanding truly the global nature of the supply chain before coming back to St. Louis. Then in the fall, they engage in some more of the traditional, required curriculum that you might see across any other school.
We engaged in that upheaval purposely because we thought our students needed to have a broader global mindset about business. This is a way to set a level playing field among the class and making sure that everyone has those foundational skills that enable them to solve business problems relatively quickly.
A second revision is already in progress where this coming fall our students will complete a new requirement in a course focused on equity, diversity, and inclusion. That’s an additional piece that marries well with our focus on values-based leaders that will help our students make sure that they have the knowledge and skills that we think are required in today’s business environment.
See how the schools you’re considering fared in Fortune’s rankings of the best master’s degree programs in data science (in-person and online), nursing, computer science, cybersecurity, psychology, public health, and business analytics, as well as the best doctorate in education programs, and part-time, executive, full-time, and online MBA programs.