What Business School Is Really Like

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Best ROI for European MBA Programs 

Want more bang for your tuition buck? In the United States, you head to Brigham Young’s Marriott School of Management for great education with a reasonable tuition. If you want to get the fastest return against your expenses after graduation, try the University of Pittsburgh (Katz), the University of Minnesota (Carlson), or Arizona State (Carey). 

When it comes to ROI, it’s hard for American schools to compete against the European counterparts, which generally run one year programs. That’s one reason, according to last year’s data from The Economist, why schools like HEC Paris and SDA Bocconi  boast ROI Of 64.5% and 55.5%, respectively. Make no mistake: Even tuition in one-year American programs isn’t cheap. Look no further than Notre Mendoza ($47,450), Emory Goizueta ($72,150), and Northwestern Kellogg ($85,000).

Alas, European aren’t exactly blue tag specials, either. For example, tuition at ESADE runs $67,461 when you convert Euros to dollars. When it comes to ROI, many European programs are holding their own against their American counterparts after twenty years.

That was one finding from Quacquarelli Symonds on their TopMBA website. In their most recent study of ROI for 46 leading MBA programs in Europe, QS found that the average ROI payback point was 30 months (with the top 10 ranked programs averaging 31 months). According to QS, attending a German school was the fastest way to recover costs (23 months), followed by France and Switzerland (28 months), and the United Kingdom (32 months).

So where can you pay off your b-school debt the fastest? That would be Spain’s ESIC, where graduates are out of the red in 15 months, half of the European average average. And it compares favorably to Spanish heavyweights like IESE, and ESADE, where the average payback is 37 months. Among European programs, you’ll also find the lowest tuitions at Hungary’s CEU Business School ($14,760) and Spain’s European University ($18,600).

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But don’t assume the highest tuitions equal the longest reimbursement periods. Exhibit A: The London Business School (LBS), where students are paying back tuition faster than average (27 months) while paying the highest costs ($94,477). Conversely, the aforementioned IESE and ESADE, with $90,927 and $78,449 price tags respectively, average 37 months for repayment. That’s peculiar, as The Financial Times reports, in their 2015 global MBA rankings, that LBS grads earn a weighted salary of $154,147 within three years of graduation, compared to comparable salaries at ISEAD ($155,015) and IESE ($144,992). In fact, IESE’s average graduate salaries represent a 121% increase, compared against 97% at LBS and 86% at INSEAD. In other words, repayment rates can’t necessarily be benchmarked against income.

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European B-School graduates are also keeping pace – if not outperforming – their American counterparts when it comes to long-term ROI. For starters, European grads are earning $91,586 (in U.S. dollars) in starting salaries. That is comparable to a second-tier American program like Rochester Simon ($92,262). However, top tier European starting salaries don’t match up well against American programs early on. Take the first three years, for example. Here, INSEAD grads are the top earners at $155,015. However, those earnings trail behind eight American programs (and one Indian program). That said, European programs comprise six of the top 20 highest average earners in this category. And ss time goes on, they only earn more.

For example, QS found that “Europe boasts the world’s highest average 10 year MBA ROI, USD $0.67 million over 10 years and USD $2.9 million at the 20-year mark.” In fact, it reports that “20 business schools in Europe enjoyed 20-year ROIs of $3 million or more: IE, IESE, ESADE and ESIC in Spain; INSEAD, HEC Paris and EDHEC in France; IMD and St. Gallen in Switzerland; Cambridge, Cranfield, Imperial, London Business School, Oxford and Warwick in the UK; Copenhagen Business School in Denmark; Mannheim and WHU in Germany; SDA Bocconi in Italy, and RSM in the Netherlands.”

In the United States, only three MBA programs – Harvard, Stanford, and Wharton – reported ROI over $2.9 million dollars at the 20 year mark (though this P&Q data, developed in conjunction with PayScale,

didn’t factor in data like stock compensation – a major incentive for entrepreneurs –  and retirement benefits, a perk for high level execs and CEOs). Regardless of methodology, the QS numbers debunk, to an extent, the popular myth that international students must come to American schools to gain the highest return on their MBA over time.

Even more, as QS reports, an MBA often produces major salary increases. “Among MBA graduates in Europe,” writes Louis Lavelle, “12 business schools reported post-MBA salary uplift in excess of 90%. The highest salary uplift was reported by Vlerick (155%), followed by St. Gallen (150%), the University of Edinburgh (146%), ESMT (145%), European University (138%), HHL Leipzig (127%), MIB (114%), HEC Paris (112%), Durham (111%), Bath (110%), EMLYON (110%), London Business School (107%).”

Bottom line: Forget the perception of Europe as tired, overregulated, and in decline. As these numbers show, there is plenty of opportunity – and reward – for graduates among their top MBA programs.


Sources: TopMBA, TopMBA

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