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European vs US MBA
by Ashu Singh - Wednesday, 30 January 2008, 02:37 PM
 

cat 2008 cat 2009 mba 2008 xat 2008 european us mbaThe debate of European Vs US MBA is endless and students applying to B-schools through GMAT in 2008 can find numerous articles on the net; some articles will actually analyze the statistics and try to come up with a plausible answer while others would take a neutral stand, provide you with a lot of information and then finally leave the ball in your court. Left to his own devices, a student again types the keyword in the google search bar, reads more stuff and gets even more confused. I can tell you this because I have gone through this grind and can understand the plight of ordinary students. One will have to go through numerous websites, talk to alumni, do a comparison, check the viability of financial aid and many more things before something finally starts to make sense. The truth is that finding the right B school is no different than finding a life partner. There are beautiful people, intelligent people, rich people and all sorts of people out there. A partner richer than you are might not actually understand your financial sentiments or a partner intelligent than you are might not respect your intellect. So ultimately it boils down to two key words "Perfect Fit". There is no easy way to determine the 'perfect fits' in life but there is one basic thing to get closer to discovering the 'perfect fit' and that is to understand who you are and what you really want.

Asking the right set of questions one might inch closer to finding the answer to the big question of 'perfect fit'. I will discuss with you the questions that I asked in order to make a better decision.

Will an MBA get me a good job?

Though a more pertinent questions would be to ask whether an MBA will help me get closer to my career goal. Sadly most of us don't really know what they want and try to flow with the stream, fighting for a job which gives them most security, more money etc. What ever be it, if one does want to do an MBA so that he can catapult himself into elite class of managers who are getting good bucks, doing more challenging jobs and command the respect of those working under him, there is nothing wrong with this approach either.

My analysis

I feel that a US MBA scores over any other MBA because of a lot of reasons. US economy is undoubtedly the biggest in the world and in spite of its recent slowdown it has tremendous appetite to absorb skilled work force. But how does one decide whether he/she can actually bag a decent job. I surfed a lot on internet to try and find the answer to this question, all articles and statistics gave a general idea. None of them actually mentioned the fate of Indian students studying abroad and I realized that I had to be specific if I need an answer. I started collecting relevant data. How many people of my profession, seafarers i.e., have taken a plunge into the business world. What schools they have chosen and how were they placed after the college?

To my surprise, all the people that I can find had finally narrowed on two options- ISB and US MBA. Out of 9 seafarers I tracked this year (between GMAT range 650-760) only two applied to London School of Business (one got through), two applied to INSEAD (no luck here) and all applied to both ISB and US colleges ( Ranked 1-40 as per business week).

Of the four seafarers I know who have passed out of universities, 2 managed to get a job which pays them 100k+. Out of 5 seafarers who are presently studying there 3 have managed to bag decent internship.

A lot of seafarers have been going to ISB too and getting a average pay package of 11 Lacks. (Not a fair bargain after spending 17 Lacs at the college).

I was able to track only one seafarer who did his MBA from Lancaster University in UK and presently he is working in India in a job affiliated to shipping and I guess it fetched him close to 12 Lacks per annum.

I also attended a few MBA tour and asked the representatives of Cambridge (Judge School of management), Rotterdam school of management and ESADE (Spain) about the prospects of a job after MBA, but they all tried to dodge this question as much as possible.

So my search for European MBA was very much inconclusive. In the absence of good leads I decided to drop the idea of a European MBA.

What is the attitude of the government and the business community of the country one plans to study in

US is one place where there is least government intervention with the policies regarding the issuing of work permit to internationals who have graduated from US universities. 20 000 H1B visas are reserved for international students who graduate at master's and PhD level. On the contrary the HSMP (Highly Skilled Migration Program) which was launched by UK government in 2002, which gives skilled work force a period of 1 year to stay and look for job in UK, has been in shambles lately. The skilled class is constantly under the threat of deportation as paranoid British citizens are constantly demanding more and more protection and job security. The news about the rest of the Europe is not very encouraging either; lack of local linguistic skills is a major handicap when one is out scouting for a job.

It is the candor exercised by the corporate world that makes it easy for immigrants to blend into the work force. A smart student who has done all the right things during his two year tenure at the B school is almost at par with an American student. Though not every company sponsors an H1B visa but most of the good companies do. In comparison, to secure a decent job in UK, after an MBA one has to perform very well and try to be within the top 10% of the class. This task is not so easy as it may sound, so students are under a lot of pressure to secure a good job.

How will I finance my education?

Financing an MBA education can be a tricky business and most of us cannot afford the exorbitant cost of an MBA, but still the number of MBA aspirants going to destinations all around the globe is increasing. Most of us believe that the loan and accrued interested can be paid off pretty easily once we get a good job. Even Indian colleges such as ISB which can roll you back by a good 16 Lacks receives 10 times more application then it has the seats available. So how do we muster the courage to live up far beyond our resources?

I will quickly discuss how I expect to cover the cost of my MBA education at Goizueta Business School (Emory University), Atlanta, USA

College fee (for two years) –                               USD 75 000
Living expense (for two years) -                           USD 50,000 (Appx. Figure for married students, single
(Miscellaneous included)                                      students can expect this figure to be around $30,000)
TOTAL                                                                USD 125,000
 

Scholarship grant -                                               USD 60,000
Expected income from summer internship-             USD 15,000 (This figure can vary from $10,000 to 25,000)
Expected signing amount from my first job-            USD 15,000 (average)

TOTAL                                                                 USD 90,000

I have omitted personal savings from the projected estimate.

As one can see that US colleges are pretty generous in distributing scholarships, few of my friends have even received full tuition scholarship. Students who can demonstrate that they are worthy candidates are granted scholarship on merit. Since Goizueta is one school which arranges for loan without any collateral I see no hurdle in financing my education. (The interest rates are pretty high, but this figure can be brought down if one has a relative who is willing to co-sign the loan or if one has good credit history in USA)

As one can see that scholarship covers a major portion of the expense during my two year education and I expect to cover the rest with the sources that I have described above. But one must also remember that not all the colleges have fee as high as Goizueta; some of them are in the lower range as well, but if one goes by the ranking as most of the Indian students go, they are likely to find a lot of colleges in the top 50, which do so. Similarly one can find colleges which are not as expensive as Goizueta. State Universities such as Michigan state, Penn state, Arizona state, Ohio state have good reputation and have tuition fee ranging from USD 50K to USD 60K. Also Atlanta being one of the bigger cities of US, entails higher cost of living, as one moves to colleges in not located in big cities, the cost of living comes down dramatically. For example, Kelley school of business, Bloomington, Indiana, where I managed to secure an admission also, has a monthly expense of USD 1200/month, as compared with approx USD 2000/month at Atlanta. On the contrary, colleges such as Harvard and Wharton cost approx. $85k in tuition fee alone.

Comparing this with B schools in Europe and Canada, most of the colleges do not offer guaranteed loan, even the mean scholarship offered is much lower than those offered in US colleges. On the brighter side barring London Business School where the tuition fee is USD 80k, other colleges go easy on your pocket. INSEAD $55k, IMD $ 61k, Cambridge $55k, Queens University (Canada) $55k, ESADE (Spain) $60k are few good business schools are the world which go easy on your pocket. The one year MBA makes you ready to enter the job force after a year of gap and seduces students to make a lopsided decision, especially in the case of career changers who do not fully understand the importance of summer internships in laying the foundation of good placement after the completion of MBA.

The bright side of studying in UK is that students are allowed to work 20 hrs/week, with an average pay of 5 pounds per hour. So if a student wishes to utilize the full 80 hrs of a month, he/she can earn 400 pounds, which is approx Rs 32,000/month. Not bad at all, but again considering the expenses in UK and time constraint imposed by rigorous one year curriculum this money would be hard to get.

Respectability of MBA degree

A US business degree is held in high regards throughout the world (after all they were the pioneer of business education and a potent force behind globalization of trade). So if one wants to come back to India after doing an MBA or wants to settle anywhere else in the world, he would be at an advantage. Picture this- Out of 50 MBA schools which make you eligible for HSMP in UK, 26 are from USA.

Apart from the brand ID the US b schools have a very strong alumni network all across the globe which serves as a strong point when one goes out scouting for a job.

Furthermore, the wealthy Alumni of US schools have a series of advantages over their European counterparts, notably in terms of money. For example, Nike founder Philip Knight recently pledged $105m to Stanford, while Harvard Business School received more income from endowments and gifts last year than from MBA tuition fees.

"More money means better teachers, improved research opportunities and ultimately superior students," the study notes.

Since my ultimate goal is to come back to India after working for a few years in US, I also started looking for students who have followed a similar path. I am yet to meet anyone, but I guess it won't be long before I meet somebody and the picture would be much clearer then.

To sum up the main points I would like to reiterate the gist of the points that I have covered above.

There are a couple of factors that affect an international student.
a.      
Attitude of the government
b.      
Attitude of the business community
c.      
State of Economy

One cannot do much about the option c and should understand very well that the chances of getting a good job decrease exponentially when the economy of the country is in shambles. There is no way one can prepare for this eventuality but options (a) and (b) are very much one can explore in depth.

I asked my set of questions and analyzed each option to a point where my tiny brain could take no longer. I found my answers in Goizueta Business School and pray that I have made all the right decisions. I am also very much aware that with a slowing US economy things would be tight around there, but I am prepared to take my chances.

My advice to all of the MBA aspirants is that they should frame their own questions and seek for the answers. I would be here to help you guys with all the resources and knowledge that I have.

Re: European vs US MBA
by abhi s. - Thursday, 31 January 2008, 01:32 AM
 

Dear Ashutosh Sir,

This is ship no- 5926 (99-02 batch).

I have applied for few schools here in India and need some insight for preparing the question of Why MBA and Why now .It's been around 5 yrs for me sailing and my basic reason is the growth issue.Though I have got a lot resources for preparing but I wish to collect data from people of my field. Do you have some data concerning PI questions asked to seafarers in MBA schools ? especially what to do when they ask y after so many yrs you wish to switch over your job to something totally "irrelevant" like finance or marketing and jeopardise all the experience you gained during shipping work-ex.

Please post your PI experiences.

Thanks

Abhi. 

Thank you
by M G - Thursday, 31 January 2008, 11:44 AM
  Its a very good article and has opened up doors and channels of thought which hitherto were constricted by Rankings and the media-obsessed salary factors.

I would be much obliged if you could help me out

1. May I know some resources that will help me get some much needed information (authentic) on the various questions like placement info, batch break-up, ROI etc. I use Businessweek, USNews, FT, forums that connect Similar aspirants like TG and some student blogs to gain insight into the culture of the B-Schools.

2. Would it be prudent to invest in any coaching centre for my essays and other application paperwork ?

MG
mimmiesme@mememe.in
Re: European vs US MBA
by Ashu Singh - Saturday, 2 February 2008, 08:19 AM
  Abhi,

Seafarers that I know of normally take one of the following streams.
1. Consulting 2. Finance 3. General management/Supply chain
So, the point is that majority of students do an MBA to switch careers and having a marine background might make things difficult but in the end all depends on your will and commitment.
Start talking to people and read stuff to learn exactly what each job demands and what skills and interests do you have. I'm sure you would come up with answers that you can explain to people.

smile
Re: Thank you
by Ashu Singh - Saturday, 2 February 2008, 08:32 AM
  MG,

What we don't realize is that if we reach out to people, more often then not they would be ready to help us.
I have all sort of prospective students calling me from all parts of the world to know about Emory. I try to help them in whatever way possible.

No magazine or website can answer all your questions and you have to really push yourself to know all the answers. Its a time consuming process, so start ASAP.
Write to the business schools, ask the program office to give you e-mails/phone number of current students. Read blogs and forums. Use b-schools website and do your research.
I'm sure if you do this you would get answers to most of your questions.

About the essays I'd say that unless you are terrible at writing essays, it is worthwhile to write your own essays. Get a lot of opinion on your essays and keep on reworking after the feedback. Read a couple of good essays on the internet to get a feel and then start writing your own. Remember that some one reading your essay might have a very different back ground and culture, so do not get too specific with technicalities. Be confident in selling yourself and never loose focus from the question you are answering.
Do this and you'd be fine.
smile
Re: Thank you
by Total Gadha - Sunday, 3 February 2008, 04:32 AM
  Thanks Ashu. smile
Re: Thank you
by priyank daga - Tuesday, 5 February 2008, 04:58 PM
 

hi Ashu,

Can you give me the list of the good B schools in US(top 25)..I have the list for the top 20 best b schools of the world , which has around 10 US b -schools

Re: European vs US MBA
by Saurabh Shekhar - Wednesday, 6 February 2008, 03:13 PM
 

Thanks a ton for the valuable info Ashu.

Regarding the scholarships , could u pls tell me the process of getting a decent scholarship. I have been informed by some of my frens dat while getting a scholarship for MS or a Phd. course is easy , it is a very difficult process for an MBA degree.

Also ,the MBA course in US, is 18 months (correct me if I am wrong) that includes 6 extra months of internship. Is internship a essential criteria considered by the Employers ?? Or is it an added advantage ?

Please enlighten me on the same.

Thanks in advance,

Saurabh

Re: European vs US MBA
by Ashu Singh - Thursday, 7 February 2008, 01:19 PM
  Saurabh,

There are 2 basic criterion for scholarships
1)Need based
2)Merit based

Mostly Indian students qualify for the need based criterion. For merit factor they mostly look for good GMAT score, previos work experience, Interview
performance,Essays etc.US top 10 B-Schools give very little scholarship.

US MBA is either 2 years Full time or One year Full time.In 2 Year MBA there is internship during the Summer break after completion of the first year and
the period is 10-12 weeks. Its not mandatory to do internship but I don't know anybody who has not done the internship (It adds value to your resume and helps you secure full time job offer).

smile
Re: European vs US MBA
by Saurabh Shekhar - Friday, 8 February 2008, 01:02 PM
 

Thanks again Ashu,

But are these two scholarships mutually exclusive ? Or can a student avail both of these at the same time  ?

Moreover, regarding the process of attaining scholarships , why is it considered quite complicated as compared to getting the same while doing ones' MS /Phd. courses ?

Hope I am not bugging you too much . But I dun have much sources for information.sad

Thanks,

Saurabh

Re: European vs US MBA
by priyank daga - Friday, 8 February 2008, 02:33 PM
 

hey ashu,

u did not reply 2 my query...

Plz help me out as i in a state of confusion 

Re: European vs US MBA
by Total Gadha - Friday, 8 February 2008, 06:16 PM
  Hi Priyank,

I doubt Ashu can provide you with the list. Nearly every list is prepared by magazines and the lists vary from magazine and keep on changing every year.

Total Gadha
Re: European vs US MBA
by Sodium Hydro Phosphate - Saturday, 9 February 2008, 03:59 PM
 
Hey Ashu, TG and Everybody,

I have a question here. Ashu also said in passing that ISB doesn't have that ROI to consider it good enough and I often hear people saying that about an MBA from ISB. I did a few calculations and wondered if that's correct to say.

If a candidate spends 18 lacs at ISB for an year and then gets a package of 10 lacs (Talking about only the fixed component of the salary ! Variables are uncertain and CTC is invisible), then the payback period comes to less than 2 years. Isn't it pretty decent ! I mean you take even any US B school and see the payback period. Everywhere it comes to about 2 years. Talk about AMD, INSEAD, Harvard...even their own websites claim, wherever they do, a payback period of about 2 years (And there they consider the complete pay package, including variables and CTC).

Take IIMs vs ISB for only this ROI factor: At IIMs, you spend about 7 Lacs in 2 years and get 10 lacs (I assumed same 10 lacs fixed component for both IIM and ISB here at a work ex of 2-3 years for an avg candidate who was not among those top 10% of the graduating batch) thereafter. But you spent 2 years there and didn't get that 10 lac in the second year which you would get if you graduated from ISB. So, the cost at IIMs comes to 17 lacs...same as that at ISB ! Now, isn't the payback period same at about 2 years even for IIMs ! And why forget that after ISB, you got one extra year of your 20s for starting your life afresh after finishing studies and dating that eye candy of your's one year early, this time not in Alto but in City, may be !

I talked about the ROI factor mainly. Regarding the brand factor, I find the top few US B schools way ahead but when talking about the IIMs and ISB, if I disregard the ego inflation that you get from cracking the IIMs, the two do not differ in the available career and dating prospects to their students.

I am looking for inputs. Please say something on this.

Thanks,
Sodium
Re: European vs US MBA
by Ashu Singh - Saturday, 9 February 2008, 11:05 PM
  Priyank,

US news, Business Week, Wall Street journal and Financial times are some of the standard b-school ranking agencies.
Just type in "US news business school ranking" in Google search bar and you will get the list.

smile
Re: European vs US MBA
by Ashu Singh - Sunday, 10 February 2008, 07:50 AM
  Hi,

I think just limiting our conversation to ROI only is not fair. There are other intangibles that one must also consider. Quality of education, quality of peers, quality of job that you get post MBA etc. These are all qualitative aspects hence perceived value keeps on changing from individual to individual.
Your calculations are perfect and I would not argue that 2-3 years payback period is nothing when you look things from a long term perspective. This period is almost the same if you do your MBA from US, provided that you get a decent scholarship.
As I had mentioned in my article, what you want to do with your career should decide which school should you choose. Every school has its strengths and weaknesses and you must find that out. Is the school good for career changers? Is it a finance school? Does the school attract good general management companies? and so on.
Students whose long term goals are aligned with the strengths of the school can have much better ROI then the rest.

I have tried not to engage in a debate here but to share my honest opinion and experiences with you. I hope it helps.
smile
Re: European vs US MBA
by Sodium Hydro Phosphate - Sunday, 10 February 2008, 11:38 AM
  I agree with you there Ashu.
Re: European vs US MBA
by bn mishra - Wednesday, 27 February 2008, 06:06 PM
 

hi ashu,

great job man really appriciate the way u have mentioned all the aspects of ur US journey. hope u do well in life.

good luck?

 

Re: European vs US MBA
by Break_the_rules Change is eternal - Thursday, 28 February 2008, 09:11 AM
  Hi ashu ,
Thankx for jotting down experience .It was great .I just have some doubts .U said that its hard to get scholarship in top 10 B-schools .So if i dont get any scholarship then can u tell me way to finance my studies .Can i finance my studies fully by taking loan or is there any clause that i can finance only some percentage of total amounts ,rest i have to pay in cash .And also can u give details about loans .
Re: European vs US MBA
by Ashu Singh - Friday, 29 February 2008, 09:58 AM
  Hi,

Getting your MBA education financed is always a big challenge. Even the B-schools know this fact. A number of schools try to give some form of financial aid and its easy for schools which have huge endowment funds, but not all schools are that rich.
Here is what happens.
To secure a loan you need to have somebody take your guaranty or what is also called as collateral against the loan. If you have somebody living in US and he/she is willing to take your guaranty and also has a good credit history, you are eligible for a loan. Not all students have some relatives in US and most of the top B-schools help you secure the loan without any collateral. But of course you compensate for this privilege by paying higher interest on your loan.
If you get an admit in a school which does not cosign the loan then you might have to arrange it from India itself. I'm not sure but you can get upto 15 lacks for higher education.
I don't know of any other way to secure a loan, but I would sure try to find out.
Hope this helps.
smile
Re: European vs US MBA
by rock star - Sunday, 1 June 2008, 01:43 PM
  Hi Ashu,
I am really happy i reached this page and the summary of your findings are really helpful. First of all God Bless all of you who are trying to 'fine-tune' the future workforce. Thanx again.
Just one question (what else smile)--  i am looking for a career in Media Management. I would like to work in the advertising, movies or publishing business..i have always been in love with art in all its forms. Is there a possible career option like this? Is there a B-school which is a Mecca in this segment ? Also i have 4 years of SAP experience but i am ready to put all that behind for doing what i have always wanted. Is it advisable ?
I got 660 on GMAT. Is there a B School where i stand a chance ?
Please reply as i am waiting.

Thanx and Regards.
Re: European vs US MBA
by think tank - Monday, 27 July 2009, 10:15 AM
  Nice Article Kudos

But I have a question that Let say if anybody has no restrictions regarding Finance and intellectuals and anything then which Option is better
A. Top 20 Indian B schools through CAT
B. Top 50 US B schools through GMAT and all...

Please give merits and demerits for both the cases if possible... And Please try to make the answer as realistic as possible...

thanks a ton...