Master of Business Administration
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Master of Business Administration (MBA) is a master's degree in business administration. Originally designed to provide engineers with management skills, today's MBA draws applicants from a range of disciplines.
An MBA is considered a professional Master's degree as well as a traditional or academic Master's degree. However, completion of a professional MBA does not usually result in admission to a Ph.D. (program for research-oriented engagements) although it could be helpful. Schools that offer the MBA are usually known as either management or business schools.
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History
The MBA designation originated in the United States, emerging as the country industrialized and companies sought out scientific approaches to management. The first American business school, Wharton School of the University of Pennsylvania, was established in 1881 (initially as an exclusively undergraduate institution). Tuck School of Business, part of Dartmouth College, was the first graduate school of management in the USA. Founded in 1900, it was the first institution to confer advanced degrees (masters) in commercial sciences, the forebearer of the modern MBA.
In 1881 the Chamber of Commerce and Industry of Paris founded École des Hautes Études Commerciales (HEC) as one of the first business schools in France. In 1898 the University of St. Gallen and in 1909 the Stockholm School of Economics were also founded as some of the first business schools in Europe. As the US MBA model emerged at the turn of the 20th century, Europeans developed centres of excellence in business, such as at the universities of London and Manchester. Elsewhere in Europe colleges such as Cass Business School, London, IMD, Instituto de Empresa, INSEAD, Henley Management College and Ashridge were set up to provide management training. In 1968, the Asian Institute of Management was founded. In 1969, HEC started the HEC MBA Program. However, unless otherwise specified as Mini MBA program leading to an award and formal alumni status, quality of open-executive programs are not comparable with a formal MBA degree.
In the United States, by one estimate, the average cost of earning an MBA via an accredited full-time program (excluding room and board) rose from $124,000 in 1993 to $162,000 in 2001 (see Davies and Cline, 2005). The bulk of the cost is in the form of foregone earnings ($109,000 in 1993 and $139,000 in 2001). Accounting for the decrease in expected unemployment as well as the increase in expected wages and expected wage growth, the financial benefits to holding an MBA degree are the equivalent of an 18% rate of return on the cost of the degree (see Davies and Cline, 2005).
Executive MBA
Executive Master of Business Administration (EMBA) programs were first established for senior executives by the University of Chicago in 1943 and are now offered by many schools worldwide.
An EMBA is essentially a part-time MBA, but the average student profile is slightly different. These programs are aimed at experienced executives who prefer not to take a career break to take a full-time MBA and typically require significant business experience to gain admission. Unlike their counterparts on full-time MBA programmes, EMBA students are able to implement and practice what they learn in the classroom in their job as they learn and there are greater opportunities to learn from classmates.
These programmes may serve as finishing schools for upwardly mobile executives, or as catch-up educational opportunities for technical executives who lack business expertise.
Admissions criteria
Programs usually base admissions on the GMAT test, significant work experience, academic transcripts, essays, references, and personal interviews. Schools are also interested in extracurricular activities and community service activities. The latter is more important for what are considered top-tier full-time MBA programs.
Program content
Breadth
MBA programs expose students to a variety of subjects, including economics, organisational behaviour, marketing, accounting, finance, strategy, operations management, international business, information technology management, and government policy.
In the traditional US MBA model, students study a wide breadth of courses in the program's first year, then pursue specialisation in the second year.
In other parts of the world programmes can last for longer or shorter periods. Typically in Europe the duration is between 1-2 years, one less than in the United States (2-3)
Specialisation
Many programs allow students to specialise in a particular area, such as organisational behaviour, marketing, accounting, finance, operations management, technology management, insurance management, strategy or international business. Unspecialised MBA programs often focus second-year studies on strategy.
MBAs in Academic advancement
MBAs from universities evaluated by United States National Research Council (USNRC) may equip future scholars and professors. Such MBA category is a milestone for both professional and academic career advancement. Refer to faculty directories of such schools and USNRC ratings.
MBAs in Management consulting
Business schools and leading media announced on regular basis recruitment of MBAs by leading management consulting firms.
Non-USA based MBA Programs
Today, MBA/DBA designations can be found anywhere and even accessed through on-line, distance learning or e-learning, such as that offered by the Open University Business School of the UK which has students world-wide. Because of the varying standards of MBAs worldwide, many of the elite business schools are accredited by independent bodies, such as the Association of MBAs and the European Foundation for Management Development.
France
France has initiated one-year MBA programs, with INSEAD MBA pioneering this formula in 1959. Most of the Grandes Ecoles also offer respected MBA programs, including ESCP-EAP (the oldest business school in the world, founded in Paris in 1819), ESSEC, HEC, EM-Lyon, ESC Rouen and EDHEC. University-based French business schools have created since then (mostly in the 1990s) their own 12 to 24-month MBA programs, but with a much lower emphasis on internationalization and diversity.
UK
MBA programs in the UK differ from those in the United States, in that students typically have significantly more work and managerial experience than their American counterparts. This allows mature students to add the benefit of their work and life experiences to be shared with other students. Because of this, many full-time MBA programmes in the UK typically last one academic year (as compared with two academic years in the United States, and at older UK MBA programs, such as those at London Business School and Manchester Business School).
The UK Government announced in its April 2004 budget that persons holding an MBA degree from the world's top fifty business schools will be entitled to work in the UK for one year. After this year has elapsed, they are likely to qualify for the UK's Highly Skilled Migrant Programme. This, in effect, means that an MBA from one of the top schools is a ticket to UK residency status.
South Africa
Few people are aware that South Africa was home to the first MBA outside of the USA. The Graduate School of Management at the University of Pretoria (GSM) was founded in 1949 and two years later, 25 graduates received their MBA degrees – the first to be awarded by a non-American university.
In 2004, South Africa’s Council on Higher Education (CHE) completed an extensive re-accreditation of MBA degrees offered in the country, undoubtedly raising the standard of local programmes. The process was the first of its kind in the world to be undertaken by a statutory body and attracted widespread international media attention for its innovation and thoroughness.
Asia
International MBA programs are acquiring brand value in Asia by way of institutions like Indian School of Business (which partners Kellogg and Wharton), Asian Institute of Management, Manila; 6 IIMs in India, 7 IITs - Schools of Management, MDI, Delhi; SPJIMR, Mumbai and XLRI, Jamshedpur. In pakistan LUMS is also recognized as an international business management school. While a foreign MBA is still preferred in Korea, many students are now studying at one of many "Global MBA" English language programs being offered. Hong Kong and Singapore are also becoming MBA destinations. For North American students who want a different experience, many of these programs offer scholarships and discounted tuition, to encourage an international environment in the classroom.
Oceania
The Australian Graduate School of Management (AGSM) offer a 1.5 year full-time MBA program.
External accreditation
Business schools and MBA courses may be accredited by external bodies which provide students and employers with an independent view of their quality.
Accreditation may be provided by
- The Association to Advance Collegiate Schools of Business (AACSB) - mostly USA schools
- EQUIS (European Quality Improvement System) - mostly European schools
- Association of MBAs (AMBA) - mostly non-USA schools
See also
- Bachelor of Business Administration (BBA), a bachelor degree in business administration
- Doctor of Business Administration (DBA), a doctorate in business administration
- Business schools, for lists of business schools across the globe
External links
- Association to Advance Collegiate Schools of Business
- Graduate Management Admission Council (GMAC) is the organization that provides the GMAT examination
References
- Davies, A. and T. Cline, 2005 The ROI on the MBA, BizEd.
- The MBA in South Africa, MBA.co.za.da:MBA
de:Master of Business Administration es:MBA fr:Master of Business Administration id:MBA nl:Master of Business Administration ja:経営学修士 no:Master of Business Administration pt:Mestrado em administração de empresas sv:Master of Business Administration zh:工商管理碩士