Is the investment really worth it?

The case for sponsoring an employee who is pursuing an MBA
By Christopher Lynch
|Canadian HR Reporter|Last Updated: 05/06/2013

A master of business administration (MBA) is probably the best-known professional degree. Initially a general management degree, it has evolved to the point where it’s possible for a person to specialize in hundreds of different areas.

At its core, an MBA provides an individual with fundamental business and management skills, but it also requires a substantial financial investment. So why should an employer support an employee pursuing an MBA? Here’s why:

Improved job performance: An MBA will provide an understanding of business fundamentals such as accounting, marketing and finance. Employees will expand their ability to think strategically across business functions. Understanding the bigger picture and interactions at play will lead to better decision-making and creative problem-solving.

It will also help develop soft skills. With an emphasis on collaboration and team-building, employees will improve their communication and interpersonal skills.

Peer network: MBA programs bring together bright and talented individuals from across industries. The intensive nature of an MBA program and group focus help individuals develop strong bonds with classmates. This network of peers provides not just a sounding board for ideas but also a valuable knowledge base. Hearing the experiences of others helps managers identify best practices and new approaches to issues that may be affecting their organization.

Employee retention and succession planning: Sponsoring employees to complete an MBA is a great short-term retention tool as employees will continue with the company during the program. Depending on how sponsorship agreements are drafted, employees may also be required to commit to stay with the company for a set period.

Signalling organizational support to an employee and identifying him as a future leader is more than just motivational — it can prevent talented and ambitious employees from looking outside for career advancement. Investing in employees as future managers or leaders keeps organizational knowledge and functional expertise within a company.

Strategically, it is also a strong step in succession planning, ensuring key employees are prepared to move into senior roles. Financially, the costs of hiring can exceed the costs associated with developing leaders internally.

MBA degree options

Universities deliver MBA degrees in a number of formats:

Full-time: Anywhere from one to two years in length, a full-time MBA allows students to focus on their education and development without workplace distractions. However, this option comes at a large cost for employers — in addition to tuition, there are also employee living costs and the cost of hiring a replacement in the interim.

Part-time: A part-time MBA allows individuals to continue working full-time while completing their degree outside of normal working hours. Part-time programs offer the benefits of in-person study while giving employers an immediate return on investment — employees are able to bring what they learn in the classroom to work the next day.

Distance: Distance learning offers more flexibility than a part-time MBA as students aren’t required to be in class and are able to work through courses on their own. However, they lose that in-person contact with professors and classmates.

Executive MBA: Targeted towards more senior managers, executive MBA programs differ primarily in class makeup and the methodology by which material is delivered. Executive MBA programs are very intensive, allowing students to continue to work full-time while completing courses through evenings and weekends (often completing the degree in the same amount of time as a full-time MBA student).

Cost, time considerations

MBA degrees require a significant financial investment. MBA and executive MBA fees range from $25,000 to more than $100,000. With the economy struggling and training budgets stretched, it may not be feasible for an employer to offer significant financial support.

However, there are other ways a company can help. An MBA can be a significant time investment so employers can offer employees a more flexible work schedule. Flex-time arrangements can make it easier for an employee to attend class.

Shifting responsibilities can also lessen an employee’s workload, allowing her to focus on an MBA, while an educational leave allows employees to complete their studies knowing their position will be there for them after graduation.

Christopher Lynch is director of recruitment for the Alberta MBA at the University of Alberta in Edmonton. He can be reached at (780) 492-5877 or

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