Business education and the business degree have been popular for the breadth and depth of skills they enable students to take to the job market.
They can choose specialised degrees majoring in any functional area of business; Accounting, Finance, Human Resources, and Marketing, or general degrees such as the Masters of Business Administration (MBA) that offers exposure to them all.
The possibilities and applicability also make the business degree a comparatively safe option to improve employment prospects or career progression.
However, is this really the case? Considering the financial costs of taking any time off to study, does a business degree still offer a good Return On Investment (ROI)?
It is a fair question, given the workforce has more degree holders than ever before, yet degree holders are also a quarter of today’s unemployed.
In addition, the latest Graduate Outcome Survey showed about 74 per cent of those with a bachelor’s degree in business are employed full-time within six months of graduating. However, nearly a third of them admitted to working in roles or industries which did not enable them to fully utilise their skills and education.
Consider the required investment: a government-assisted/subsidised business bachelor’s degree costs $43,500, and an MBA ranges between $28,000 and $86,000. If a business academic teaches ROI, then it should know if a business degree still offers a good ROI.
As expected of an academic the answer is ‘it depends’.
It depends upon three considerations: the expected return, asset utilisation and due diligence prior to purchase.
Firstly, ROI associated with something intangible like education is tied to expectations and what students think a business degree represents.
Those who expect it to guarantee employment or career progression may be disappointed when they realise that even if they graduated from a prestigious school like Harvard, no one is promised a job, interview, or promotion.
As the real world teaches us, these outcomes are also influenced by interpersonal skills and historical performances, rather than the degree itself.
The degree will go further however if students use the classroom as a ‘learning lab’ to experiment with newfound knowledge and ways to improve your work.
Many MBA graduates have discovered through the application of critical thinking, more mature and holistic methods of consideration, planning, and implementation by referencing themes taught at business schools.
The degree certificate is a signal of your potential, as well as your aptitude and mental fortitude; nonetheless, it is just one of the many assets in your portfolio.
Understandably, disappointed graduates might regard their business degree as a regrettable sunk cost because it may not have delivered the expected immediate returns. However, yields in education are often subtle and go unnoticed because it is internalised in the individual and vary with personal development and maturity.
A business degree teaches generic skills like self-confidence, critical thinking, project collaboration, task management and presentation skills which are honed repeatedly. All of these contribute to career progression and earning potential.
Perhaps this by-product is best considered an invaluable and intangible asset with future payoffs that should not be discounted.
This leads to the second point of asset utilisation. Beyond the degree itself, business schools connect students with subject matter experts, lifelong personal and professional peers, alumni, and mentors across a myriad of fields. They access on-campus recruiters, career advisors, internships and practicums and they access libraries with the latest academic and practical resources.
Investing the time in nurturing some of these connections into relationships will yield greater ROI; otherwise, the business degree can be under-utilised and its full potential unrealised.
A recurring example of under-utilisation is the application of theory in practice. The teaching and research from business school academics often emanate from the real world.
Students are taught well-established theories and frameworks and are encouraged to critique and or demonstrate its value in real world applications.
In the absence of clarity or data, theories can help structure thinking, while case studies highlight lessons and parallels between different scenarios.
Regrettably, lessons may be forgotten long before the opportunity to apply it. Utilising and recalling the themes and links to the business school effectively extends the life of the asset and its ROI.
The final consideration is whether students know exactly what they are purchasing. Like all things, the market has its peaches and lemons, so the principle of caveat emptor (let the buyer beware) applies.
Universities are service providers and like any other organisation providing a variable service some encounters are going to delight while others may not.
Where a university is different is in the nature of education being a high-touch service with numerous working parts in a highly co-created relationship.
Over the course of two to three years, each student will encounter thousands of touchpoints, 40 hours a week on-campus and 24/7 off-campus.
Invariably, there may be students who are dissatisfied with their overall student experience which has been tainted by a few bad touchpoints, even if they are wholly satisfied with the teaching.
Good universities provide a good service because they aspire to deliver the best possible student experience, not because they got every touchpoint perfect.
To avoid disappointment, students should try before they buy. Universities are welcoming, so visit the campus, attend a few classes and speak to alumni, staff and students.
Extending your search beyond league rankings and traditional brand names might uncover the business school that best fits your needs.
Making a well-informed purchase will better align a student’s expectations, help them discover more useful connections and get more from their business degree.
