The question is not whether you can afford to invest in yourself; it is whether you can afford not to.
Let's face it the economy has not been in its most stable condition for the last year or so. Although that is a given, it is certainly not stopping many ambitious executives from seeking the education they need to take their career to the next level. The Executive MBA (EMBA) degree remains one of the most solid investments you can make in yourself: intense leadership development, greater strategic vision and immediately applicable skills are all benefits for an EMBA graduate. But perhaps the most commonly quoted and highly anticipated benefit is that of a greater salary.
The good news is that a salary increase on completion of an EMBA is nearly guaranteed. In fact, the most recent Executive MBA Council report shows students quoting an average salary increase of 23% after graduation. Equally interesting is the fact that the report shows the actual payback period for an Executive MBA has been reduced from 23 to 17 months over the past year, despite average program costs rising from US$53,180 in 2005 to US$63,420 in 2009.
Company Sponsorship - a waning trend
In the past, most employers understood the major benefits they could receive from having an employee with improved managerial and leadership skills, not to mention the reinforced loyalty of sponsored EMBA participants. The current economic climate has had an impact on this kind of thinking however and company sponsorship is on the wane. Rachel Killian, Warwick University's MBA Marketing and Recruitment Manager says: we have seen a significant fall in the percentage of participants with employer sponsorship in 2009. However, our overall student numbers haven't fallen, suggesting that self-funding applicants still very much value the EMBA experience and are willing to fund themselves if their employers cannot.
According to the Executive MBA Council, there are indeed an increasing number of students self-financing their studies with the proportion of students paying their own way increasing from 25% in 2003 to 34% in 2009. Meanwhile, the number of companies offering students full reimbursement in 2009 was 32%, down from 37% in 2005. Business schools still expect, at the very least, to see organizations supporting their employees by allowing them to take time out for study and recognizing the additional workload they face during their EMBA.
When a company does decide to invest in a valued employee it not only benefits from a direct return on investment from the rich course content, but also sees the increased confidence and broader communication skills the employee brings back after each module. This lays the foundation for new responsibilities, not only for the EMBA participant preparing for the next level, but for the organization developing healthy succession planning within.
Interestingly, Executive MBA students foresee these benefits, but underestimate their power. The Executive MBA Council reports 37% of students exiting an Executive MBA program expected a promotion - 43% were actually promoted. Not only that, but once promoted they are more likely than graduates from other programs who received a promotion to report an increase in their budgetary authority, according to a GMAC Global Graduate Survey.
Everyone comes out winning
Joan C. Coonrod, Assistant Dean of EMBA Admissions and Marketing at Emory University's Goizueta Business School stresses that EMBA programs can play a powerful role for companies by helping them step up their retention efforts. She tells EMBA candidates to reflect on their career path and get their company involved. Applicants should talk to their companies about support, and make their case for this type of development and the capability they will bring back to the organization, she says. It's interesting that executive recruiters tell us companies that do invest in this way to build their leadership are well-known, and are consistently more successful in attracting top talent. In essence, the EMBA program can become a tripartite partnership between the school, the EMBA participant and the sponsoring organization.
According to Ashridge EMBA graduate Chris Parker, there are strong arguments in favour of a company spending a figure of around GB£30,000 on sending a senior manager on an Executive MBA program. This is the sort of money that might be spent on getting consultants in for a fortnight, but the short term benefits from something like that are far outweighed by the long term benefits that a manager with an EMBA can deliver to a company, in terms of enhanced management knowledge and experience from practical assignments, he says.
Many schools such as IESE and INSEAD provide assistance to strong applicants on how best to present their case to their employers, and enumerate the advantages of the program to the organization to turn the project from 'cost' to 'investment'. Yet Janine Golden, an alumnus of the University of Chicago's Booth School of Business recently told Pink Magazine, I would do it all over again even if my company hadn't paid for a portion of my education. I was willing to resign if they didn't support the time commitment. I felt the contribution to my future success was invaluable.
The future looks bright
Promotions and increased earnings are just one side of the coin. An EMBA also allows students to start 'looking around with a new set of eyes' according to Gabriel Mesquida Masana, an EMBA alumnus of the Henley Business School. You start seeing things that weren't there before and thinking of new solutions to old problems, from operations to strategic management. In my case there was a star subject: managing people. I've been given more responsibility and more complex situations to manage. I've seen my selfassurance grow, along with skills and abilities. I've grown professionally, he says.
Fordham's Director of Executive Programs, Francis Petit, says he strongly believes the EMBA is a sound investment, regardless of the economic climate and financial environment. The goal of each program should allow candidates to think in an entirely new way in regard to business opportunities, markets, value, strategy and innovation. This 'personal discovery' can be applied to a student's career well beyond graduation, Petit says.
The decision to make a serious 18-24 month commitment - from the admissions process to managing an overbooked agenda, bosses' expectations as well as respecting family commitments - goes far beyond rising compensation packages. There is much, much more to the EMBA adventure. There is also an incredible learning experience, a stimulating environment and the chance to meet people from all corners of the globe with rich, diverse backgrounds - people who form a network graduates can keep in touch with years after completing their programs.
All of the EMBA alumni we spoke to would whole-heartedly re-live their EMBA experience without changing anything, and as the EMBA Council reports, a spectacular 99% of EMBA students would recommend the EMBA as the ideal launch pad for rising executives ready to take on a new challenge and upgrade their career paths. Perhaps Rachel Killian of Warwick Business School sums it up best: When the economic climate is tough and unemployment is high, the best investment people can make is to invest in themselves.