With so many college degrees available, one has to wonder – what made the MBA the most powerful degree in the world? How has it evolved over the years? How does it stack up against emerging challenges and alternatives to formal education?
Let’s start with the basics and then build up the story.
What is an MBA?
A Master of Business Administration (MBA) is a graduate college degree designed to help students master the fundamentals of business management.
Students can choose a narrower focus on marketing, finance, and accounting, operations, supply chain management, human resource, technology management or opt for specialty, sector-specific programs. MBA programs range from full-time and part-time to international, online, and executive variants.
The MBA has been traditionally thought of as one’s passport to a successful career in the business world. It has been perceived as the most powerful degree, and it has a famed history of producing the world’s top leaders and managers.
According to the 2022 Corporate Recruiter Survey, the demand for MBA graduates continues to be high. In 2022, 92 percent of employers were interested to hire MBA graduates across all sectors and industries.
The U.S. boasts the world’s top business schools, including the magnificent 7 (M7) business schools, whose degrees are coveted in all corners of the world.
Let’s take a closer look at the rise of the MBA as the most sought-after degree in the world. Bear in mind that, while the above numbers are striking, even the top-ranked MBA programs are not immune to emerging challenges that could threaten their dominant status.
History of MBA
It seems there is a consensus over the origins of the MBA. The United States is the birthplace of MBA programs. The accelerated process of industrialization bred a demand for qualified business executives.
Rigid management was to give way to qualified managers who could manage complex and fast-growing enterprises. Toward the end of the 19th century, the education sector made a move to respond to the need.
Founded in 1881, the Wharton School of the University of Pennsylvania was the first ever business school, but it did not offer graduate degrees back then. By the turn of the 20th century, Dartmouth College’s Tuck School of Business designed a Master of Science in Commerce degree.
In 1908, Harvard’s Graduate School of Business Administration launched the world’s first MBA. Several others quickly followed suit. These include the Massachusetts Institute of Technology (MIT), the University of Chicago Booth School of Business, and Thunderbird School of Global Management.
Evolution of MBA
With the United States emerging as the world’s new superpower in the wake of WWII, its influence on the world’s economic, educational, and business architecture became all the more pronounced.
U.S. business schools and academia held sway with little competition from elsewhere. Only in the fifties did universities outside the United States start offering MBA degrees to their students.
In 1950, Canada’s University of Western Ontario launched the first MBA outside the U.S. The University of Pretoria in South Africa, the Indian Institute of Social Welfare and Business Management, and Europe’s INSEAD jumped on the bandwagon.
The University of Chicago became the first business school to establish permanent campuses on three continents: Northern America, Europe (Spain), and Asia (Singapore).
The sixties and seventies of the 20th century saw a huge spike in the worldwide spread of MBAs.
It became a matter of relevance and prestige for every reputable, top-ranked university to set up business schools offering MBA degrees under their aegis.
MBA goes online
Over the years, the MBA has become the gold standard for advanced business management credentials.
Not only did it prove to be a trendsetter in the academic universe, but it also showed tremendous resilience to emerging trends and technological changes.
One such change (and what a change it was!) was the advent of personal computers, the Internet, and online education.
In 1986, the Roy E. Crummer Graduate School of Business at Rollins College in the U.S. started requiring all students to have laptops in the classroom.
By the early nineties, Columbia Business School became a trailblazer in standardizing software. Canada’s Athabasca University launched its first online MBA program in 1994.
With digital transformation permeating and affecting all corners of the world, the way people got educated and used learning kept evolving and changing at breakneck speed.
Challenges to MBA programs
In spite of continuous technological progress, the last three decades saw the MBA program having a dream run and there were no strong triggers to rock the MBA boat.
What changed the tide was the pandemic, during which there was no option but to rely on technology to keep the business of education going. This disrupted every facet of the MBA education, including admissions, program delivery, interviews and internship.
Instead of full-time degree programs, there are those who opted for snappier online courses that could be customized and staggered. As a result, they enjoyed greater flexibility in planning study time and combining it with part-time work or freelancing.
Savvy employers have been proactively offering customized training options to their employees to retain talent. They know they can achieve considerable returns on investment by supporting iterative learning opportunities for their workforce.
Some employees prefer the benefits from continuous cycles of on-the-job training and hands-on experience rather than pursue an MBA degree.
How business schools attract top talent
It’s not plain sailing for the full-time MBA programs. The world’s business schools will have to dig deep to remain resilient and adaptive to the emerging challenges and keep pace with the rapidly evolving economy.
MBA programs now offer flexible customizable and constantly updated curriculum designed to meet the needs of a dynamic business environment, wide choice of specializations, experiential learning enabling a more hands-on learning approach, entrepreneurship opportunities, international immersions, class diversity to enhance student experience.
The most recent addition is that of the STEM-designated specializations to give MBA grads an edge in the job-market.
Change in MBA trends
For the last decade that MBA Crystal Ball has been in existence, we’ve seen a change in trends in applicant priorities. While many were earlier fixated on the elite brands, many are now looking at it from a broader ROI perspective.
With skyrocketing fees, students are now questioning the value of elite brands in career development. Other than a few industries (like investment banking and management consulting) that still use the pedigree of the university to filter out candidates, most employers place a greater emphasis on experience and skills.
Many who approach us are looking at MBA programs that offer a balance between brand power, ROI, quality of education and career opportunities after MBA.
Drop us an email – info[at]mbacrystalball[dot]com if you’re looking for help in navigating your MBA journey.
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