Is A One-Year MBA Worth It?

by Jeff Schmitt on

Worth it

Is a One-Year MBA Worth It?

 

“Faster…Smaller…Cheaper.”

Sound like a mantra you learn in business school. But would you believe it is becoming the mantra for business schools?

The desire to earn a degree sooner at less cost: That’s at the heart of the one-year MBA program. Popularized in Europe nearly sixty years ago, a one-year MBA is sometimes viewed as a panacea to what ails business schools. And it offers a tempting proposition according to Donato Wilkins, who started a one year MBA in 2013 at Emory University’s Goizueta Business School.

“I did the math, and the return on investment for the one-year program was much higher than for the two-year program,” he tells the New York Times. You get the exact same benefit as the two-year program — the same professors, the community, the G.B.S. network, all the on-campus resources and Goizueta brand — in less time and for less money.”

How much cheaper? Recently, Cornell University launched a tech-driven, three semester MBA program in New York City. The price tag: $95K. To put that in perspective: That’s over $20,000 less than its two-year program. And that’s the high end, with Northwestern’s one year program coming in around $80K, about $38K less than its two-year counterpart according to U.S. News and World Report data.

And prospective students are gravitating to these programs. In 2013, 55% of the 189 one-year MBA programs generated a higher number of applications over the previous year according to the Graduate Management Admission Council (GMAC). And why wouldn’t students pursue this option? In theory, they only lose one year of income. Burdened with less debt from tuition and second-year cost of living expenses, they also enjoy greater flexibility (and earn back their expenses sooner). And being out of the business world for two years can put MBAs at a disadvantage.  “The tech economy moves quickly,” warns Douglas M. Stayman, associate dean for M.B.A. programs at Cornell’s Johnson School of Management. “If people are out of it for a long time, it’s an issue.”

Is that really true? Not necessarily according to a 2013 GMAC study, which showed only 53% of one year students had received job offers in March, 8% lower than full-time MBAs in their second years. When it comes to compensation, two-year MBAs earned 9% more than their one-year cohorts.

And there are other disadvantages too, reports the New York Times:

“Students don’t have time to spend a semester abroad. They forfeit some electives. They can join clubs but can’t lead them (presidents are picked the spring before they arrive).”

More tellingly, top institutions like Wharton and Stanford have declined to launch one-year programs. “We haven’t felt comfortable offering a one-year M.B.A. here,” observes Madhav Rajan, who heads Stanford’s full-time M.B.A. program. “[With a two-year program], you get to know your classmates and interact with your professors over two years. The whole notion of our M.B.A. is that it’s a transformative experience.”

That said, a one-year MBA works well for a certain type of student. “[A one-year program] is for people who are accelerating their careers, not changing their careers,” Stayman tells the New York Times. As a result, one-years often know exactly what they want when they step onto campus. While they must “cram in almost a year’s worth of foundational business classes in four months,” they can still participate in electives and join clubs like any other second-year. Plus, their accelerated education offers a ‘wow’ factor to potential employers, says Alex Sevilla, assistant dean and director of Florida’s M.B.A. programs. “A student can say to a recruiter, ‘I voluntarily chose the one-year program, and that gives you some indication of my horsepower.’”

Don’t Miss: Guide to the Best One-Year MBA Programs

Source: New York Times

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  • rentseeker

    If you have a business or even an economics degree this MBA should be the only one that’s worth, at least for the knowledge. For these types of guys what’s the point in going to a 2yrs MBA program except network of course? So they know all basics and in many cases more than that, spend one year in the program for nothing and when they face an ROI question they say knowledge in invaluable, hmmm cool. I bet in the moment when HSW and other will introduce 1yr programs or even replacing 2yrs MBA altogether the applications will skyrocket. Don’t worry they’ll find a way to tell to career-changers 12months are enough to change careers, 10months in school-2months internship.

  • rentseeker

    Btw the statistical study provided above has a selection problem. We all know that the top MBA programs in US are mostly 2yrs (even Kellogg and Johnson larger cohorts are 2yrs). All of these top programs have a higher percentage of students with offers at graduation and with higher salaries than those attending lesser institutions, so most probably the results are a function of brand or the business school itself and less of the length of program. A better study will compare Kellogg (or other schools) 1yr vs 2yrs cohorts, provided they have almost the same we,gmat,gpa. 1yr MBA students tend to be a bit older and with more work experience, so they can command higher salaries.

  • Golad

    the best MBA form is the part time MBA! learn, practice, then learn, and so on. business is about practical not theories.

  • intriguedMBA

    If you are interested in a complete career change, I believe the best choice is still the full-time 2 year programs, however, if you are only somewhat interested in career change, and more intrigued with progressing through the ranks of your current corporation then I think an eMBA is best format to learn and practice followed by part-time programs. The amount of work experience and leadership of the the participants in most eMBA programs makes it a more valuable experience IMHO.

  • Squareone

    For those with 8-yrs+ of experience and considering a one-year MBA, I would strongly urge you to consider the Sloan Fellow programs at Stanford and MIT. The Stanford program is exceptionally elite and they give you access to all of Stanford, not just the GSB; it awards a Masters in Management. The MIT program tends to cater to a slightly older crowd with a number of executives in the program. MIT gives you the option of an MBA or Masters in Management. The Masters in Management requires a thesis whereas the MBA does not.

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