Should you consider an online MBA? Well, that depends on your situation.
On a much smaller scale, I deal with “in-person vs. online” question when it comes to GMAT tutoring all the time. Many students with an interest in private GMAT tutoring seem to have a strong preference for an in-person approach. However, when I explain the benefits of online GMAT tutoring, a fair number are open to considering the online option. And over time, I’ve become more inclined to encourage folks studying for the GMAT to consider doing so online, since it’s typically far more convenient, slightly more affordable, and in some ways, a little more effective (i.e., you can easily print out PDF screen shots of the whiteboard or record entire sessions for later review; you really can’t do that with an in-person GMAT tutor).
This got me to thinking; since I’m increasingly passionate about online GMAT tutoring relative to an in-person approach, should I also encourage students to consider an online MBA instead of the traditional on-campus MBA?
To explore this a bit more, let’s answer four questions: 1) what are the main reasons to get any type of MBA 2) what can you expect from an online MBA relative to an on-campus approach 3) when should you consider an online MBA and 4) when should you not consider an online MBA?
In this initial post (part one of a two-part series), I’ll address the first two of these questions.
What are the main reasons to get any type of MBA?
The following are reasonably compelling reasons to get an MBA:
- You want to learn about new business ideas and concepts and acquire new skills and knowledge to perform better in your current job
- You specifically want to receive consideration for new roles or career advancement at your current employer
- You have an interest in switching careers and want access to new opportunities, starting with an internship in a new area
- You have an interest in switching careers and want to experience them through projects, etc.
- You want to build your network of professional contacts
- You are feeling burned out in your career and are looking for a change of pace, a way to refresh, and an opportunity to reconsider your current path
- You want to pursue some sort of entrepreneurial path and want to build specific skills, get feedback on your idea(s), and receive general support in getting going
- You want to improve your professional “brand” and signal that you are motivated, talented, knowledgeable, etc. to the broader business world
I think most of the reasons people apply to business school can fit into these buckets in one way or another. Now, as we consider how an online MBA would be different from a traditional on-campus approach, let’s keep these reasons in mind.
What can you expect from an online MBA relative to an on-campus, traditional program?
I am not going to discuss too many of the “obvious” differences. Of course, an online MBA occurs via web-based classes instead of in a classroom. With a traditional MBA, you stop working and study full-time for two years in, often, a new city. With an online MBA, you generally keep working and your life does not go through too much change.
With an online program, you’ll interact with your peers via email, phone, and online environments. You’ll make connections that way, but it’s unlikely to be close to the same networking experience created by living in the same town for two years and seeing folks face-to-face in class every day, around town, and in the bars at night. You may have experiential project-based learning opportunities, but they’ll probably all be virtual. You’ll be exposed to recruiters, but it’s unlikely to approach the type of “career switching” opportunity that a full-time on-campus approach will provide.
A big part of getting an MBA, however, is “signaling” to recruiters and the broader business community that you are motivated, talented, knowledgeable, and a potential asset to an organization. How does an online MBA compare in this regard?
You’ll be covering the same material, with the same professors. You should learn the same things, and the degree you earn is the same degree offered to on-campus students graduating from the same school. As you progress in your career, and online learning because increasingly accepted, the fact that your degree was earned online is unlikely to matter. And, perhaps no one will ask you how you earned that MBA.
That said, none of the top 10 traditional MBA programs offer an online degree option. And unlike getting a JD or a MD, which is literally required to practice law or medicine, and MBA is an optional credential. You don’t need an MBA to do anything. And there are many, many accredited business schools. I always tell people to really tread carefully if you are going to consider getting an MBA from a school outside of the top 10. In fact, holding an MBA from a low ranked or unranked program can even be a negative for some employers. They may say to themselves, “why did he or she waste his time and energy on that program. Didn’t they do their research?” You want to make sure your investment in time and money will pay off through improved job opportunities.
Now, while I said that none of the top 10 traditional MBA programs (according to US News and World Report) offer an online option, this is not true of schools 11-20. Of that group, which is certainly a high-quality list of MBA programs, two offer online options: Carnegie Mellon and the University of North Carolina. These two programs offer a unique option for working professionals who don’t want to interrupt their career, but would like to earn an MBA from a well-regarded brand/program/university.
There is also the question of cost, of both the direct and indirect variety.
Let’s consider an in-person vs. online MBA from Indiana University’s Kelley School of Business. Both programs are highly ranked. Kelley’s traditional MBA program is ranked in the top 25 nationally by Forbes. Its online program is ranked in the Top 5 by US News.
The in-person Kelley MBA program, for an out-of-state student, is ~$70,000 a year for a total direct cost of $140,000. Let’s assume that you are starting the program while earning an all-in salary including benefits of $100,000. That’s a total bill, including direct and indirect costs, of $140,00 + $100,000 + $100,000 = $340,000. That’s high.
With an online MBA, you don’t stop working, so there’s no indirect cost. The direct cost for the Kelley Direct online MBA program using this year’s cost per credit hour is $1,330 * 51 = $67,830. Let’s call it $70,000 including books, etc.
Think about that. $340,000 vs. $70,000 for, at the end of the day, the same degree. That’s a big gap and powerful argument for an online MBA.
If you are considering getting an MBA from a school that lies outside of the top 10 nationally ranked programs, you should at least consider an online approach. The gap in total cost between a full-time, on-campus, traditional approach and an online MBA is too large to ignore. In a future blog post, we’ll explore scenarios where you should really take seriously the online option, and scenarios where focusing on a traditional MBA would be best.