The masters in business administration, often regarded as the magic password to the career fast track, made its first appearance in Britain in 1967, when a group of British MBA students studying in America thought it would be a good idea to bring the idea back home. Today, 24,000 students are studying for an MBA at British colleges, and 105,000 MBAs have been awarded in the past 12 years. With the downturn in the economy, even more people are taking time out to strengthen their CV with this elite qualification.
But construction has been slow to pick up on the trend. At recruitment firm Hays Montrose, less than 5% of candidates for management-level construction jobs have MBAs. Two of the traditional routes to the top in construction require little formal education: managers either inherit a job in a family firm or work their way up from craftsman to site manager to director. "Construction is seen as the most backward industry when it comes to getting MBAs," says Derrick Osafo, an architect at housebuilder Redrow, who recently graduated with an MBA from Henley Management College.
MBAs on a CV only make an impact if they complement experience
Neil Davies, chief executive, Styles & Wood
The ICE' Tom Foulkes earned his in 1998 from the Open University. He found the experience "hugely valuable" and recommends it to anyone who wants to get ahead. But he adds: "Construction has been very conservative and, in some areas, not forward thinking enough. It is a huge effort to drag it into the 21st century. If it spent a bit of time getting educated, it would discover huge benefits."
Business schools are starting to tailor their product to suit construction executives. Henley Management College has had a relationship with the Engineering Construction Industry Training Board for 10 years. Last year, the ECITB agreed to sponsor a project management MBA and pay tuition fees for 10 places on the course. Students are given a comprehensive management education, and gain international experience through study and work placements in Melbourne, Singapore, Atlanta and Barcelona.
The trend seems to be taking off. The University of Strathclyde has an MBA course designed for the industry, as does Leeds Business Management School. Taywood has linked up with Cranfield to offer a course based on the MBA, and the RICS and the Association of MBAs have discussed a property finance and management module to be offered on MBA courses at business schools.
If the industry spent a bit of time getting educated, it would discover huge benefits
Tom Foulkes, director-general, ICE
Advocates say there are substantial benefits to gaining an MBA. Apart from learning management principles inside out, the networking opportunities are enormous. Wayne Roberts, a Henley MBA graduate and senior project engineer at Parkegate Engineering Consultants in Dorset, says: "I've learned a lot from others who come from a number of disciplines. In an environment where heavy emphasis is placed on teams, this means learning about the way colleagues think about and approach problems."
Piers Copham, director of business strategy at Taywood, was one of a dozen or so candidates given the chance to study for a MBA at one of the world's leading business schools, under the Sainsbury management fellowship scheme. Copham, who studied at the French campus of Insead, an international learning institution, in 1995, recalls: "I wanted to round off my business education and to go into consulting and business strategy. I wouldn't say it was a stand-alone qualification but it certainly complemented my experience. With the industry developing so rapidly, the MBA is the perfect way to develop yourself. It is increasingly important."
But an MBA isn't a guarantee of career satisfaction, personal development and higher salaries. For a start, would-be MBAs have to choose their university or college with care. Since 1985, the number of institutions offering MBAs has risen from 27 to 118, and picking a less prestigious college risks downgrading the value of the qualification. Peter Calladine, education services manager at the Association of MBAs, which accredits the colleges, warns: "Some MBAs are not worth the paper they are written on because they come from a college with no accreditation. Without this, the MBA isn't rated."
Calladine also points out that without career experience, an MBA holds little value. "If a school is letting you in at 21, you shouldn't be there and it is not a good place to do an MBA. The average age is 27 for a full-time course and 34 for a part-time course. Some colleges see MBA courses as cash cows and don't put a great deal of effort into it. Applicants need a good college if they are to get an MBA that will be recognised."
Students also have to be certain they are doing the right thing at the right time in their careers. Pauline Weight, course director at Cranfield, says they have to be prepared to put their lives on hold. "We want to ensure that people realise what it's like. If it only took a couple of hours a week, it wouldn't hold much sway in the marketplace."
Once you graduate, firms will not necessarily regard an MBA as superior to years of experience. Chris Cheetham, regional director at Hays Montrose, believes they are only useful at the very highest levels of the industry. "I'm not convinced MBAs are that useful, particularly at the start of your career. In management roles, they are not really called for. It's only relevant at chief executive or managing director level, which only a small number will ever try to achieve."
Neil Davies, chief executive of retail property at support services firm Styles & Wood, points out that an MBA is only as good as the person who holds it. "We don't particularly court MBA candidates. MBAs are an indicator of ability to think strategically, but letters on a CV only make an impact if they complement experience."
And the letters MBA after your name won't necessarily impact on your bank balance. In a survey published in January this year, recruitment website MBAmatch found that an MBA's effect on salaries was dropping, with average pay for MBA graduates in the UK down by about 24% since 1999. Graduates can now expect a salary of £55,100 compared with £64,000 three years ago.
Ten ways to take off the poundsEradicating unnecessary expenditure is always a good idea. And the latest figures show the British economy is growing at its slowest rate since the 1990s recession, so there’s never been a better time for a cost-cutting drive. Here are 10 ways you can go about it.
- Avoid lavish corporate entertainment. As long as you offer clients a good service, they won’t miss the invitations to Wimbledon and Ascot
- Adopt no-frills business travel. Switch to budget airlines, use public transport instead of taxis and book hotels with a fewer stars
- Get tough with your suppliers. Find out how much their rivals charge
- Discourage staff from making personal calls on company phones – especially mobiles
- If practical, consider relocating to cheaper premises. Many businesses operate just as well with less space or in a less upmarket location
- Shop around to cut your utility bills
- Cut back on office cleaning – remember that some areas don’t need cleaning every day
- Offering staff a period of unpaid leave is far less costly than making people redundant, and an option which employees often prefer. You can always bring them back in when business picks up again
- Leaving posts vacant when an employee leaves is another cheap alternative to redundancies
- No more free biscuits. One civil engineer calculated recently that it spent £20,000 a year on KitKats