With the cost of an MBA rising every year, full or part sponsorship by an employer is increasingly becoming the only opportunity for young executives to finance their postgraduate business and management studies.
While the benefits to you and your organisation may be obvious it is unlikely you will receive sign-off over a coffee in the lunch-room. The relatively large cost of an MBA (compared to short executive education courses) can make it a difficult sell to any company HR manager or financial controller, particularly in an organisation which receives multiple applications every year.
As with any project or investment, building a strong business case, with a clear cost-benefit analysis will be the best way to convince your employer to invest in your education. Most Australian business schools understand the company sponsorship environment better than anyone and should be able to provide plenty of assistance in building your case.
Prepare the ground
Considering and researching the opportunity to do an MBA can take many months, sometimes years. It is important to be open and honest with your employer as part of the normal review process that you are considering an MBA. Making your direct report or HR part of the decision-making process and getting ‘buy-in’ before making a formal request for sponsorship may be one of the most important things you can do.
London’s Business School’s (LBS) guide for creating a business case for company sponsorship says it is important you think about timing and who you approach for support.
“Feedback from successful students suggests that it is absolutely vital that your find a ‘sponsor’ or ‘mentor’ within your organisation, with whom you can share the journey,” the guide said.
“Students have also told us that you need to approach your organisation at the right time, and well enough in advance. There will likely be concerns and challenges that need to be managed and overcome before you receive funding.”
Build a case
Regardless of your organisation’s formal application processes you should prepare a detailed, formal business case outlining key aspects of your application. The case should include some information, including
Make a comprehensive statement of the commitment (financial and non-financial) required from your employer. Be sure you fully understand the investment required by your organisation. Don’t forget to consider additional financial costs beyond tuition fees, like text books, study trips and technology (laptops, tablets etc). An MBA is also a considerable investment in ‘time’ so be prepared to answer questions about the impact it will have on your ability to undertake your normal duties.
What is in it for your employer? While an MBA is an investment which will reap benefits for the rest of your career, your employer will be primarily concerned with what it means for them. Clearly explain your course, subjects and learnings. Consider how these relate to the immediate needs of your employer and use examples of how a specific subject in your course may assist in developing a solution for one of your organisation’s most pressing challenges.
Recent QUT Business School MBA graduate Owen Hanson secured part funding from his employer to complete his MBA.
“The application process was fairly vigorous and competitive,” he said. “The best advice I can give is to focus on the needs of your employer, not the individual benefits for you.”
“Put yourself in your employer’s shoes and ask yourself – What will I lose? What will I gain? If you make a case that clearly articulates the benefits for them it will make it much easier to get approval further up the chain.”
According to the LBS guide you will need to ensure that you highlight the aspects of your personal development that are most important in the context of the business need and your career development plans.
Many MBA courses now focus on practical, real-world issues. Identifying specific courses, subjects or units where you can address issues or opportunities in your business and provide real solutions is a good way of demonstrating a return. Providing just one or two examples will make a much stronger case than listing every subject you will study.
State your commitment
Once of the greatest concerns to any organisation funding an employee’s personal development is the risk that investment will walk out the door to a competitor at any moment. Stating your commitment to the organisation, and being prepared to back up that commitment in your employment contract, will provide a significant boost to your chances of sponsorship.
Requesting an alteration to your employment agreement which specifies your commitment to the organisation AFTER you have completed your MBA is one of the best ways to demonstrate your commitment. You can even go one step further and undertake to reimburse the organisation for their investment if you leave. This preparedness to take responsibility for your learning and repay the investment that has been made for you by your company is one of the most important aspects of your business case.
What if they say no?
Don’t give up. If you are unable to convince your employer of the value of your MBA to the organisation, there are a range of other options to help you achieve your dream.
- Find a new employer – an MBA is highly valued in many organisations so get your CV out there.
- Fee- Help – Fee-Help is a government loan scheme designed to assist Australian citizens undertaking tertiary degrees. If eligible, you are able to borrow the total program fee, and repayments are deducted from your taxable income. Voluntary lump sum repayments are also permitted, and may make you eligible for a 5 per cent bonus off the repayments.
- Scholarships – most Australian business schools over one, sometimes multiple, scholarship programmes. Ring up your preferred school and ask them what options are available.
- The Bank of MUM & DAD – You won’t be alone in asking your parents for a loaner. According to the Graduate Management Admission Council (GMAC), MBA applicants younger than 24 say their parents will, on average, pick up 52% of the cost of their programs. Those 24 to 30 years old expect to get 36% of their financing from family, while those over 31 anticipate that their parents will pay 34% of the bill.
London’s Business School’s guide for creating a business case for company sponsorship
Requesting Company Sponsorship – Advice from Wharton EMBA students.
Asking your company to sponsor your MBA – How to MBA