DNA Is that pricey MBA really worth its weight? Maybe not ...
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Tuesday, Jul 23, 2013, 11:02 IST | Place: Bangalore | Agency: DNA

Suparna Goswami Bhattacharya


A costly course MBA course fees have gone up by over 300% in the past five years, while corresponding placement salaries have increased by less than 40%.

If you want to enrol yourself in an MBA course, think again. The once-sought-after course has lost its lustre in terms of return on investment, courtesy fees rising to exorbitant amounts over the last three years.

The Indian Institute of Management, Bangalore (IIMB), hiked its fee by more than 300% in the past five years. As on 2013, the fee stands at Rs17 lakh per annum. The fee structure for the same course was only Rs4 lakh in 2007. The placement salary for MBA graduates during the same five-year period has increased by less than 40%.

Even with an educational loan, an MBA degree today will saddle you with significant EMIs to be paid years after you have completed your course.
Seven or eight years ago, investment in an MBA course was not questioned purely from a demand-supply standpoint. Business schools in the country too have seen the number of their seats almost double after 2007. This, coupled with mushrooming of B-schools has led to an oversupply of MBA graduates.

“The placement salaries over the past six-seven years have not increased much due to economic stagnancy in the country. However, even if the economy was prospering, the salaries would definitely not match the increase in cost of an MBA degree in India,” says Sunil Goel, CEO, GlobalHunt, an HR consulting firm.

According to consultants, the skills can easily be learned on the job. They now advise students to pursue courses in areas such as big data and analytics rather than taking up an MBA course.

“When I had done my MBA in 2006, it was a valuable proposition since I recovered the course fee in less than half a year of receiving my salary. But I suggest that anyone planning to get an MBA today should do a stringent cost-benefit analysis before making their decision,” says an HR manager of an investment bank in the city.