The Best MBA Programs for “Value”
It’s such a loaded term. What does it mean, really? Is “value” simply synonymous with “bargain?” Does it reflect a perception that appreciates or depreciates as time passes? Or, is “value” a spot on the grid where cost and quality intersect?
Those are some the issues with ranking MBA programs by “value.” It is a Rorschach Test, where people see what they want based on their own experience. Some may associate value with a higher pay, promotions, or low debt loads. Others may place more weight on benefits like greater flexibility and personal attention.
MARRIOTT TOPS THE LIST FOR “VALUE” AMONG FULL-TIME MBA PROGRAMS
Despite the hazy connotations to “value,” two websites recently ranked MBA programs using that very term–though they interpret value in vastly different ways. The first comes from Value Colleges, a site that “researches and ranks reputation accredited college degree programs to find the perfect balance between quality and cost.”
To do this, Value Colleges applies three metrics: the total cost of the program (From U.S. News), the average salary of graduates (From PayScale’s 2014-2015 annual college salary report), and national rankings. In addition, the site notes that it only includes schools that “have program costs at or below $100,000.”
Not surprisingly, Brigham Young University’s Marriott School of Management tops the list. To call Marriott “underrated” has become one of the great clichés of graduate business education. Ranked 33rd by U.S. News and World Report, Marriott’s tuition – $11,620 for LDS members and $23,240 for non-LDS members, is an absolute steal. Take a higher-ranked western state school like the University of Washington (Foster) or Arizona State University (Carey), for example. Annual in-state tuition runs over $29,250 and $25,610 – thousands of dollars more than Marriott. And tuition costs are even higher for out-of-state residents ($43,086 at Foster and $41,044 at Carey).
As a result, Marriott graduates carry one of the lowest debt loads – $28,386 – among top 100 schools (with 62 percent of grads held some debt). To put debt in context, Carey grads come in at $63,095 in average debt (with 43 percent of graduates in debt). And the discrepancy is even more pronounced when Marriott is compared against private, religiously-affiliated programs like Georgetown ($52,200 annual tuition) or Notre Dame ($46,800 annual tuition where 60 percent of students carry an average debt of $69,072). Not to mention, the annual cost of living at Marriott ($20,400) is analogous to Carey ($18,408), Mendoza ($19,410), Foster ($23,590), and McDonough ($25,552).
Along with the reasonable cost, Marriott grads also yield a very reasonable return on investment. According to U.S. News, Marriott grads earn a average starting salary and bonus of $111,005, with a three month placement rate of 91.7 percent. Both numbers are on par for where Marriott is ranked (i.e. graduates from 30th-ranked Arizona State earn $112,884 to start with a 90.4 percent three-month placement rate). By mid-career, Marriott grads are earning $116,600 per year. In a joint effort with PayScale, Poets&Quants also found that Marriott MBAs earned $2,068,000 within 20 years of graduation, a total that’s higher than more publicized programs like Indiana University ($2,065,000) and Ohio State University ($1,783,000).
TUCK A SURPRISE CHOICE FOR BEST VALUE
In short, Marriott is a name brand program where you can graduate with little debt and a high probability of landing a six-figure job. However, Marriott is only one of three private programs in Value Colleges’ top 20 for value (with Dartmouth and Emory being the others). Overall, Indiana University’s Kelley School of Business ranked just below Marriott, buoyed by reasonable tuitions ($25,500 in-state and $44,460 out-of-state) which helps to offset its slightly below average starting salaries ($119,581) and three-month placement rate (88.1 percent). At the same time, Kelley students receive heavy financial aid, including 260 fellowships and 150 research assistantships according to U.S. News. In addition, Kelley students benefit from the relatively low cost of living in Bloomington ($18,540).
Surprisingly, Dartmouth College’s Tuck School of Business – an Ivy League school, no less – cracked the top three for value. What’s Tuck’s secret? Well, it isn’t tuition which, at $61,605, is among the largest among ranked schools. And its $29,925 cost of living is on the high side, too. That said, however, graduates earn an eye-popping $142,489 to start, fifth-best among top 100 MBA programs.
Beyond that, the value ratio is unclear (though Tuck grads earn $2,703,000 within 20 years of graduation according to a joint Poets&Quants-PayScale research that wasn’t factored into Value Colleges’ research). More confusing, U.S. News didn’t include student debt or financial aid information in its Tuck profile, so prospective students could see how those variables might offset high tuition and living costs (though average student debt at Tuck is $96,170 based on Poets&Quants research). The same is true with PayScale on starting salary information: It isn’t available. As a result, it is difficult to quantitatively discern why Tuck is a top 10 school for value. And Value Colleges’ flowery copy about Tuck offers few measurable reasons how it earned its lofty ranking:
“ It’s always a surprise to see Ivy League schools on a best value ranking, but those in the know realize that, whatever the sticker price, the Ivy League is dedicated to getting the best students, and their large endowments and prodigious giving allows them to provide financial support so that any student can graduate with little or no debt. Dartmouth’s MBA is built around team projects, interactive learning, experiential and experimental teaching styles, and rigorous reflection and analysis. It’s an elite group, and a challenging program with unique developmental benefits. Dartmouth’s semi-rural campus near Hanover, NH, is regarded as a familial, supportive environment, where even many graduate students choose to live on campus. As the smallest Ivy League school, students are encouraged to develop close relationships with one another and with their professors, creating a powerful bond that extends to Dartmouth’s successful, widely-dispersed alumni, meaning that a degree from Dartmouth can be a calling card for your career and an investment like no other.”