What people are buying when they buy an MBA

A man sat across from me on a call last spring, thirty-one years old, six years at a bank, good at his job and tired of it. He had the money more or less, or his parents did, and he wanted to know whether it was worth it. He had read the rankings and the salary tables and the forum threads where people fight about payback periods, and he had come out the other side no clearer than he went in.

I have had that conversation perhaps two hundred times. It is always the same question underneath, and the salary tables never answer it.

What it is not

It is not the teaching. I say that as someone who did it and enjoyed it. There is good teaching at London Business School and there is teaching you could get from a library card, and both sit on the same timetable. Nobody pays two hundred thousand pounds for a finance module.

It is not the salary bump on its own either, though the salary bump is real. If you run the arithmetic honestly, counting the two years you did not earn, the number is decent rather than remarkable. Anyone who tells you the return is obvious has not done the sum, and anyone who tells you it is negative has not counted the whole of it.

And it is not the network in the way people mean when they say network. You do not graduate with two hundred people who will take your call. You graduate with perhaps nine who will, and four of those you would have found anyway.

What it is

Three things, and they are worth naming plainly.

The first is permission. Most people cannot change career from inside their career. They are known as the person who does the thing they do. Their firm knows it, their contacts know it, and after six years they half know it themselves. The MBA is an institutionally recognised gap in the record. You go in as a banker and come out as a person who may credibly become something else, and the two years exist mostly so that everyone agrees to stop looking at what you were before. That is not nothing. For a great many people it is the only mechanism available.

The second is a signal you cannot forge. A hiring committee at a firm that receives four thousand applications needs a filter, and the filter is not fair and everybody knows it, and it works anyway. Two letters after your name move you from the pile that is skimmed to the pile that is read. You may find this distasteful. It remains true, and pretending otherwise costs money.

The third is the one nobody puts in the brochure. Two years among several hundred very ambitious people recalibrates what you think is normal. Somebody in your study group starts a company in the second term. Somebody turns down an offer you would have taken gratefully. You watch this at close range and your sense of what a person like you can reasonably attempt shifts, permanently, and it does not shift back. That is the part graduates talk about ten years later. It is also the part that is impossible to price, which is why the brochures leave it out.

Who it does not work for

It does not work if you are running away. I can usually tell in the first ten minutes. The essays come out fine and the schools can tell too, and even when someone gets in on that basis they arrive and find they have brought the problem with them in the suitcase.

It does not work if you have no idea what it is for. A programme is not a plan. The people who get the most out of it arrive with something specific they intend to do and use the two years as a lever. The people who arrive hoping the two years will tell them what they want generally leave still hoping.

And it does not work if the number genuinely frightens you. Debt changes what you are willing to do afterwards. The whole point is a wider set of choices, and a person carrying a payment they cannot miss takes the safe job, which is the job they could have had without going.

The uncomfortable part

Here is the thing I find hardest to say to clients, and I say it anyway.

The people who need the MBA least are the ones most likely to get in.

Committees select on trajectory. They want someone who was already rising, because someone already rising will rise further and the school will claim the credit. The candidate who genuinely needs the institutional shove, the one who is stuck and would be transformed by it, reads as stuck on paper. It is a machine for accelerating people who were already moving.

You cannot argue with the machine. You can be read accurately by it, which is most of what I do. Very often a person's file understates them badly, not from modesty but because they have described what they did rather than what it meant, and nobody has ever told them there is a difference.

What I told him

I told the banker that his arithmetic was sound and beside the point. That he did not want a higher salary at the same bank, he wanted to stop being a person who works at a bank, and that there is no other mechanism in the world for that which works as reliably. That the network would be nine people and the nine would matter. And that if he went hoping the school would tell him what to want, he would waste two years and a great deal of money.

He went. He is at Wharton. He tells me it was worth it and I believe him, though I would not have been surprised by the other answer.

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