Part-time MBA programs take off

Too expensive for potential students
But the biggest reason for potential students shunning full-time programs is the monetary cost, according to Albert Niemi, dean of the Cox School at Southern Methodist University. "Part-time programs are going to dominate the MBA market as far as we can see because of the large opportunity cost at a full-time program," Niemi says. A degree at a top full-time MBA program like the Johnson School at Cornell University costs $71,000 in tuition plus something like $130,000 in forgone compensation. Tuition at the top part-time programs is pushing $80,000, but these students get to keep their jobs. In addition, employers often foot part or all of the tuition for part-time students.

The MBA isn't quite the golden ticket that it was in years past. The average base salary for a graduate of a U.S. school was $75,000 last year, the same as in 2000, while tuition has jumped 8 percent annually during that time. And getting a job isn't as easy. In 2000 the top schools placed 90 percent of their students in jobs by graduation. Last year only 70 percent of students at these schools had jobs. Cox's Niemi thinks that banks are hiring more undergrads with business degrees because they are cheaper and come with less of a sense of entitlement.

Geoffrey Ley was working in research and development for PepsiCo's Frito-Lay division when he weighed his options for business school. Full-time tuition would have come to $70,000 atop $150,000 in two years of missed salary. So Ley went to the part-time program at SMU's Cox, where tuition was $50,000, and he was able to keep working. "I thought I could integrate my MBA education more effectively to build my career while studying part-time," he says.

Flexible alternative
Part-time programs are more flexible than ever. The road-warrior salesman never could get an MBA, but now schools such as Duke University offer online MBAs. "Students don't have to fit themselves into programs anymore. The programs will fit the students lifestyle," says Fernandes of the accreditation body. E-mail and instant messaging allow students and faculty to seamlessly communicate even if they are 2,000 miles apart.

Sharad Sundaresan, a programmer for Microsoft in Redmond, Wash., entered the part-time program at the University of Chicago. For three years Sundaresan boarded an 11 p.m. flight out of Seattle on Friday and arrived in Chicago at 5 a.m. He hung out at the airport until the school's shuttle bus picked him up for a full day of classes and then went back to the airport on the shuttle and caught a 7 p.m. return flight to Seattle. Tuition was $75,000 and flights cost another $30,000. E-mail, instant messaging and conference calls allowed Sundaresan to work on group projects with classmates in four different cities. "No regrets," says Sundaresan. "It afforded me the chance to keep my job, and the quality of the education and the networking opportunities were the same as the full-time program." The reward for his degree: a management consultant job at McKinsey & Co. and no debt.

Business schools are trying different strategies to increase enrollment. Harvard ramped up its recruiting on college campuses and this year accepted 20 undergrads straight from school; it took only 5 the previous year. MBA programs are also admitting a higher percentage of applicants, 42 percent last year versus 32 percent two years prior. Guidance experts say full-time programs are probably best for students who want to change careers or industries.

Tuck's dean, Paul Danos, thinks that full-time is superior to part-time. "The total immersion experience students get in a full-time program allows them to create skills and get a depth of understanding that you can't get any other way," says Danos. But in a nod to current trends, Danos admits that even Tuck is considering a part-time program, possibly in New York or Boston, because tiny Hanover, N.H., isn't near employers. Says Danos, "Every major MBA program is going to have an alternative way of being delivered in the next ten years."

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