One of the great appeals of online learning is the ability for technology to tear down financial barriers to an MBA — including the opportunity cost of not working. And with fewer overheads from teaching facilities, business schools often set the price of online tuition far lower than for their campus courses.
Not every school offers discount rates for Online MBA programs, however. Some have a price point that is indistinguishable from their full-time MBAs. There is an extreme valuation gap between Online MBAs, which means one traditional determinant of quality, price, may only tell part of the story.
Prospective students will need to look beyond the headline figure to determine which program is right for them. It is a critical analysis, given that studying for any MBA is a huge investment of time, money and energy.
Focus on the ROI of an Online MBA
Cox School of Business, at the Southern Methodist University in Texas, encourages prospective students to look past the immediate cost and focus on the return on investment of the degree. “Earning an MBA is a once-in-a lifetime opportunity to accelerate and change your career trajectory,” says Jillian Melton, director of Online MBA admissions. “It is essential that students go to the program that best fits their needs and can help them accomplish their goals.”
Good metrics to consider in the analysis will include the faculty to student ratio, the proportion of synchronous or live teaching, whether there are practical learning opportunities, immersions on campus and full access to career services.
Melton says for both full-time and Online MBAs, there are lower cost options that often rely on larger class sizes, fewer live sessions, fewer opportunities to expand your network and grow your career through clubs and consulting work with real companies.
At SMU Cox, there is a small price difference between the Online MBA versus the full-time program because the value of the degree and the opportunities students receive are very similar.
“Prospective students can better understand the individual return on investment for a specific program through asking questions of faculty, staff and students around alumni outcomes both at graduation and several years later,” says Melton.
[See the Top 10 Online MBA Programs for ROI]
At the other end of the market is the iMBA course at Gies College of Business at the University of Illinois at Urbana–Champaign, which costs just a fraction of the tuition fees of full-time options elsewhere.
The price point does not reflect a lower quality, but rather, a mission-driven approach to delivering education, according to Brooke Elliott, associate dean at Gies. “The iMBA was founded with the mission of providing access, and one big barrier to access is price,” she says. “By lowering the cost of the degree, we have been able to attract highly qualified students who otherwise would not have been able to pursue graduate education.”
She argues that price does not indicate quality, adding that the brand of a business school is more important in terms of commanding prestige among employers and prospective students. The school uses the same respected faculty to deliver the iMBA, they just do it in a different way.
On weighting up the ROI, Elliott notes that online students are still able to continue working full-time while juggling their personal commitments, so they do not forgo a salary or pass up chances for promotion. “And not taking that time off to pursue a full-time, residential program allows students to immediately apply what they learn to their work, which can drive career growth,” she adds.
Weighing the value of an Online MBA
The question for prospective students, then, is what value do I get from doing an Online MBA at a certain institution? This decision will be informed not just by the caliber of faculty who teach on the program, and the reputation of the school, but also the use of the latest technology to deliver a high-quality online learning experience.
Location is another factor. “US-based students will want to weigh up the trade-off between the US market recognition of US institutions, with the benefits of having a more diverse class profile that is more typical of European programs,” says Markus Perkmann, academic director of the Global Online MBA at Imperial College Business School in London.
He attempts to explain the vast gaps in the price of digital degrees, noting that programs led by core faculty who run live sessions and provide ongoing tutor support are expensive. Asynchronous courses also cannot be scaled indefinitely, while “blended” courses that include face-to-face teaching will have to pay to use teaching facilities on campus. But all three factors add value to the student experience, says Perkmann.
He adds that, beyond the sticker price, Online students do not have to relocate or incur the major travel expenses that would be required for residential MBAs. Return on investment, he says, should be based on both salary and responsibility gains, as well as the new skills and knowledge students will have acquired during their MBA.
Finally, he notes there are a growing number of “micro credentials” in the online market, some of which attempt to compete with Online MBAs. “But if a student is looking for a curated degree in the online format, then an MBA from a leading school is one of the most competitive options out there,” he concludes.