MBA degrees are traditionally considered expensive, and for good reason. Although these days, high-quality online MBA programs can be found by prospective students for very reasonable costs, it’s difficult to deny the fact that some MBA courses require major financial investment.
So how much does an MBA cost in Australia?
As we reported in our article on the cheapest online MBAs, the average price of any type of MBA in Australia – on-campus MBA, face-to-face, full-time, part-time, online courses, etc. – is just over $58,000. This includes on-campus and online MBAs.
The most expensive is University of Melbourne’s Senior Executive MBA, which will set you back $126,000. The cheapest is CQU’s online offering, at $16,992.
Spending tens of thousands of dollars on anything is a major investment from which the prospective MBA student would expect a healthy return. It’s not an investment that can be taken lightly.
Whether the MBA student is in a full-time job, is into entrepreneurship and would like to launch their own business, or simply values the potential networking opportunities, cost is always going to be a serious consideration.
Understanding why that cost is so high is an important part of the process of finding the right MBA program and appreciating it as you’re completing the coursework. For the same reasons that those with an appreciation and knowledge of wine are happy to spend more on a bottle, or those with deeper knowledge around motoring might splash out on a high-end automobile, an appreciation of why a Master of Business Administration costs a certain amount can help with the enjoyment and outcome of the MBA program itself.
Many of the faculty responsible for managing MBA courses, including academics, teaching staff, administration staff and researchers, are well respected in their fields.
This might mean they’re subject area experts such as human resources specialists or marketing gurus. It could mean they’re experienced and accomplished people managers or business management experts who have spent several recent years at the executive level. In their own industries and arenas, they are able to earn an impressive income, so reputable schools must pay attractive salaries.
Then there are the special guest faculty members from various fields who, whether for a full-time executive MBA (eMBA), a traditional MBA program or an online MBA, must also be attracted into the MBA program to share their expertise. This might be a one-off appearance as a guest lecturer, a more regular, perhaps once per semester, special session, or a longer period at the business school in a special role.
These industry heavyweights don’t just add to the high level of networking opportunities experienced throughout an MBA course. They also provide all students, whether full-time, online or distance learning, with valuable industry insight and can often shine a light on where the brightest job opportunities lie in fast-changing business environments.
Bringing these thought leaders to the business school (sometimes from international posts), accommodating them and paying them for their time and expertise can be a costly, but valuable, investment.
Finally, most top business schools and business degree programs also employ experts with stellar reputations and excellent work experience in roles surrounding the academic and teaching cohort. After all, those that educate others about doing good business want to create excellent business practice in their own workplaces.
Such professionals might be in roles such as human resources, marketing, sales, placement services and career advice, IT professionals, accreditation consultants, financial aid consultants, business management experts and more. The better they are at doing their jobs, the better the business school will run, whether it is set up to provide online MBA programs or traditional MBA programs.
These support staff help to attract excellent academic staff as well as leaders from the corporate world.
Expertise always comes at a cost. The idea of an MBA is to create expertise in each MBA student. If those designing the coursework and running the MBA degree aren’t at the top of their game, the outcome suffers.
So, whether it’s for an own-pace online learning course or a full-time or part-time face-to-face MBA program, the people creating and delivering the higher education, those who keep the business school running, are extremely valuable to the students as well as the business school itself.
The better their expertise, the greater job opportunities MBA graduates will experience.
Businesses themselves have complex and expensive infrastructure requirements, particularly when it comes to technology and property. Prior to the COVID-19 crisis, businesses paid premiums for office space in central areas where staff could come together and work efficiently. That office space was constantly changing and evolving as further research was conducted around performance, engagement and efficiency. Of course, COVID-19 has now created a more distributed form of working in certain industries, which comes with its own costs.
The expense of running a business then is much more than the cost of the people it employs.
In this same way, universities and their business schools are no different from corporate and other commercial entities. Whether in the United States, Australia, the UK, Europe or elsewhere, reputable business schools have large investments in property and technology.
On the property side, an enormous amount of campus space is required to deliver on the requirements of on-campus MBA students. Lecture halls, tutorial rooms, study spaces, breakout areas, laboratories, indoor and outdoor social spaces and more all require investment and management.
Of course, part of the reason that online MBAs are generally more affordable than on-campus MBA programs is because these costs are suddenly negligible. Academic and administrative staff still need workspaces, of course, but the massive and expensive real estate requirements for thousands of students are no longer an issue.
That’s not to say there are no unique costs in delivering online MBA programs. Expertise is required to design and develop technology that allows online learning, to deliver degree programs in a way that is just as valuable and immersive as non-online education.
There are costs of hardware and software, costs of developing and managing online programs, costs of systems, processes and bandwidth that allows for face-to-face communication and real, meaningful networking opportunities. But still the online courses, with the added benefit of allowing online MBA students to study at their own pace and in a place and time that fits in with their busy lives, are generally cheaper than on-campus MBA degree programs.
Judging an MBA by its cost is one way to approach the decision of whether to enrol or not, and that is a wise approach. However, the flipside should also be considered. An MBA has a cost, but it also has value.
Every investment, by its very nature, has a cost. But without investment, there would be little growth in value. So how do you increase your own value?
An MBA can open up entirely new career paths in senior management and leadership. It opens the doors to the executive pathway, teaches its graduates the DNA of great business, and gives entrepreneurs the knowledge they need to give their startup a far greater chance of success.
For those with the self-discipline and drive to make it through an MBA degree, income typically rises dramatically. As we reported in our article about increases in MBA graduate salaries, the 2019 BOSS MBA Ranking study showed that graduates from Australian MBA programs took home significantly higher income than they did prior to studying the degree.
Graduates from Australian MBA degrees saw a combined average pay rise of 28%, to an average of $157,000, a report in the Australian Financial Review said.
Amazingly, the salary increase for those who completed an Executive MBA was even greater. Those that graduated from EMBA courses, the AFR said, saw their average salary skyrocket from $154,000 prior to the course to $222,000 afterwards. That’s a massive increase in an already impressive salary, post EMBA, of 44%!
In the same story, we reported that major employers of MBA graduates in Australia, according to PayScale, include:
And so, in the studying of an MBA there is a cost and there is a value. As discussed, understanding the reasons behind the cost, but also deeply appreciating the value, is the secret to enjoying, and making the most out of, the MBA experience.