Does your MBA still make you leader of the pack?

Twenty years ago, if you couldn't sing or dance, and your chat-up lines were failing, one guaranteed way to impress business-minded people at a party was to let them know you had an MBA. Rare and exotic, those three magic letters were the sexiest thing in business. If you couldn't pull with an MBA, you were in trouble. Today, saying you've got an MBA is less remarkable in such circles than saying you've got a GCSE in cookery. so what's happened? Richard Brass writes

Whatever MBAs are, they're certainly no longer rare. In the UK alone more than 100 business schools are churning out a total of 10,000 of them every year, while US academies produce nine times as many. At the same time, the numbers clamouring to get into the courses continue to rise, with applications at one leading business school doubling in the last five years.

But is it really worth the effort? How much is to be gained for a finance professional by sacrificing a year or maybe two of effort and salary, plus fees of anywhere between £15,000 and £40,000, for a qualification that has become so widespread and is now offered by such a variety of institutions that its efficacy has been called into question?

David Trapnell, of the recruitment consultancy Michael Page Finance, which specialises in the jobs market for finance professionals, says an MBA is far from being a golden ticket, and that anybody expecting an immediate pay-off from doing a course will be disappointed. 'In the short term, MBAs are not massively valuable,' he says. 'A lot of candidates for jobs come to us saying 'I've just got an MBA, that must improve my salary by £10,000', or whatever, and it's absolute rubbish. But, in the end game, if you want to be an FD or a CEO, that's when they come into their own.

'It's not really the fact that you've got the MBA, it's more the fact that you've been on that course and you're a better-rounded candidate all-round. You've got the marketing as well as the finance, and you've probably got a good set of networks from it as well.

'To a great degree the relevance of an MBA depends on the role the employer's seeking to fill. If it's more of a commercial opportunity, the MBA certainly has more merit than a big compliance role or something like that. Also, we find that US companies are much more into MBAs than UK ones. It's more of a standard qualification there than it is here.'

When Stella Donoghue finished her MBA at the UK's Cranfield School of Management in 2000 she was very doubtful about its benefits. 'While I was doing it I regretted it because, academically, I didn't find it hugely challenging,' she says. 'The day I left, I would probably have said it was a bit of a waste of money.'

With a successful career as an accountant in the hotel industry behind her, including a spell as finance director for Claridge's, she took the course because she thought it might help her break out of the pigeonholing she found she was subject to when applying for jobs in other industries.

In that regard the course was a success. 'Nobody has said anything to me since about me only knowing the hotel industry,' she says. And, despite her initial misgivings, in the four years since finishing the course the longer term benefits have revealed themselves, and she now believes it was a crucial step in her career.

Now working as a portfolio finance director, providing services to a variety of small and growing companies, Donoghue says the MBA has furnished her with the tools to work across a range of industries easily. 'An MBA gives you a much broader management viewpoint,' she says. 'Even though you don't end up knowing everything about everything, you have enough in each area that you know how to approach it or do the necessary research yourself.

'It also gives you enormous confidence. Certainly, before Cranfield, I wouldn't have been able to stand in front of someone, look them in the eye and say 'I charge £700 a day, but I'm worth it'. Now I can, and I can tell them where I can add value. It gives you great confidence in that selling and networking ability.'

Dr Pauline Weight, director of the full-time MBA programme at Cranfield, says a central benefit of an MBA is the way it can help accountants and other professionals take a crucial step beyond their speciality. 'If there is a typical profile for an MBA, it is often the person who's come up a functional route, like marketing or accounting, or a professional career, like a lawyer or a doctor, who wants to move into a senior management role, and therefore they're doing an MBA to broaden their knowledge and develop their leadership and influencing skills.

'But people have different drivers about why they're doing an MBA. We have a few people who come to our part-time programme who are on very substantial salaries, and perhaps want to start their own business or are fed up with trading in the City and want to do something totally different but realise they don't have the knowledge or the skills to do that.'

David Simpson, a senior manager on the London Business School's MBA programme, believes the wider view provided by an MBA is highly valuable even if you're happy to remain a specialist. 'You may be learning about accounting, but you're also learning about marketing, general finance and organisational behaviour at the same time. So you don't think of a particular subject in a vacuum, but in the context of a business in general.

'Just as marketers need to understand their firm more widely to put marketing into context, accountants need to understand more widely to put accounting into context, especially at a higher and more strategic level. Even if you're working at a very functional junior level within accounting, it always helps to have an overall view of what the firm's doing.'

The most important question to ask yourself when deciding whether to take the plunge into an MBA is why you want to do it, says Hazel Reddy, MBA programme director at Oxford Brookes University. 'Being clear about why you're doing an MBA is important in ensuring that you achieve your goal. I've been involved in MBA programmes for many years, and it has become apparent, the longer I've been engaged with students, that those who have a very clear view of why they're taking an MBA are those most likely to be successful.'

What you want from the course should also inform the kind of course you choose, she says, whether full-time, part-time or distance-learning. 'Choosing the right course is similar to buying a car. An MBA is not the same product at each school and you should consider your needs, the features of the MBA programme and the offering school.'

For Stella Donoghue, the network that came with a full-time, face-to-face course was one of its key benefits - again one that only emerged over time. 'I had no concept of the value of networking before the MBA,' she says. 'Now if I were looking for a new job or new clients I would feel there's plenty of scope through the network.'

Headhunter David Trapnell says whatever you want to get out of an MBA yourself - a network, confidence, a broader viewpoint, strategic skills - is up to you because employers generally see an MBA not so much as a training course but as a mark of ambition. 'Employers aren't so interested in the details of the course. For them an MBA is like a badge of character. If you've already qualified to be an accountant and then you go and do an MBA you obviously want to do pretty well in your life.' An GCSE in cookery still isn't quite the same.

Richard Brass is a freelance columnist and feature writer, covering general and business issues for magazines and newspapers including The Times of London, the Daily Telegraph and The Observer. He is a former editor of Punch magazine.