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campusreview.com.au
Do MBAs still matter?
T
What is the value
of an MBA in the
21st century?
Tim Kastelle interviewed
by Loren Smith
26
he University of Queensland may offer the
best MBA in Australia, but should people even
bother doing one?
Admissions to MBA programs worldwide have
generally increased and become less selective. And
then there are the tepid corporate profits (ergo, fewer
opportunities), the rise in entrepreneurialism, and
the degree itself – which teaches fairly traditional
corporate management skills.
Despite this, globally, doing an MBA still seems like
a solid bet. Commenting on the recent international
MBA Employer Survey from QS, its chief executive
Nunzio Quacquarelli noted that: “Based on QS’s
[research], there are more jobs for MBA graduates in
the world today than at any previous time in history.
“There are perhaps three times as many MBA
jobs today as there were in the lead-up to the 2007
financial crash.”
Some people, however, aren’t convinced about the
value of an MBA.
IT executive Jeanine Walters * decided against doing
the degree on several grounds. For one, cost-benefit
wise, she figured it wasn’t worth it. Also, she was told by
various company leaders and recruiters that experience
counted for more. And third, she attended a Harvard
MBA information night and was not impressed by the
calibre of graduates, and for her that was the nail in the
postgraduate business degree coffin.
So what does all this mean for the MBA?
Associate Professor Tim Kastelle may have some
answers. The MBA program director at UQ sat down
with Campus Review to discuss not only the degree’s
pitfalls but also its praises.
CR: How has the MBA’s value changed compared to
when it was for senior executives only?
TK: In university terms, it’s still a relatively young
degree because it’s been around for less than 100
years. In some respects, it’s still in a state of flux.
There’s a couple of things going on. Number one
is that the overall level of education, especially in
Western countries, has been increasing dramatically
post World War II. So, the percentage of people with
undergrad degrees has roughly quadrupled over
that period. And so, built into that is a little bit of a
qualifications arms race.
As more people get undergrad degrees, that
becomes the de facto requirement for many positions
that in the first half of the 20th century didn’t require
a degree at all. Then, as people are entering into
entry-level jobs with undergrad degrees, the question
“What do we need to move forward?” has often been
answered with “We need another degree”.
The rise of the MBA has gone hand in hand with
that rise in undergraduate credentialing. It’s hard to
unpack those two points in terms of drivers of an
increase in the awarding of MBA degrees.
That’s one factor. The second is that there’s been
a shift in what people think the MBA is for. It’s always
been a general management degree. It was originally
designed to be almost a vocational trainer for
managers, because in the 1930s, when it first started,
really simple things that we now view as fundamental
business activities were viewed as novel, or crazy, or
innovative, like doing double-entry bookkeeping to
keep your accounts straight. That was a source of
competitive advantage in the 1930s.