This is the age of MBA scholarships; an era where leading business schools are competing to see which can give more or higher-valued scholarships.
Poets & Quants reported that Harvard Business School (HBS) in fiscal year 2018 discounted tuition by a record US$37 million in fellowship aid, as published in its recently released annual financial report. Four years ago, this figure was only US$31 million.From US$37,312 in the prior year, average fellowship aid per student – covering an average of more than half of a student’s total tuition – rose four percent to US$38,959.
From 2014 to 2018, the award for its two-year MBA fellowship increased from an average of US$59,358 to US$80,000.
At the University of Florida, full scholarships are offered for full-time MBA students, with around 65 to 75 awarded each year.
— Ilana Kowarski (@IlanaKowarski) June 21, 2019
Such generosity reveals how far business schools are willing to go to get the most talented applicants, a figure that goes up to hundreds of millions of dollars per year. It’s produced a system where the most sought-after students get deep discounts while the rest pay increasingly higher tuition fees.
A massive endowment and high profits partially explain why HBS dishes out such generous financial aid. Others are pushed by an increasing number of MBA spaces globally as well as a surging number of international applicants making the battle for talent more intense.
More talent translates to potentially higher rankings, which usually measure incoming GMAT and GPA scores and outgoing salaries and job offers. Candidates’ potential future success would also reflect well on their alma maters, so the scholarships are good investments by the business school in the long run.
MBA scholarships are now the main funding source for all graduate business degree courses, surpassing savings, loan and employer support, according to the Financial Times. They have become a lifeline for many and can be the decisive vote on whether one enrolls in an MBA or not.
The Prospective Students Survey Report 2017 by the Graduate Management Admission Council (GMAC) found that as the cost of attending business school goes up, candidates are looking more critically on how they finance their studies and how long it will take to make a full return on investment.
“In response to rising costs, candidates seek to fund a greater percentage of their education through scholarships, grants, and fellowships. They anticipate less reliance on financial support from
their parents, their employers, and loans in comparison with recent years,” said the report.
“For many, the decision about which school to attend will come down to which one offers the best financial package.”
Grants, fellowships and scholarships make up the largest source – accounting for 30 percent of the average financial mix – of intended funding among prospective MBA students surveyed by GMAC. This is followed by loans (24 percent), personal earnings/savings (21 percent), parental support (16 percent), employer assistance (five percent) and spouse/partner earnings (two percent).
So how are MBA scholarships won?
Writing to US News, Elissa Sangster, CEO of the Forté Foundation advised the applicant to focus on getting a high GMAT score, though that alone would not be enough. Her foundation focuses on increasing women leaders in businesses, and one of the key experiences that help women reach the highest ranks of leadership is attending an influential business school.
“Your application should tell your story, reflect on your career and life experiences to date, and show how you can contribute to your school during your MBA and to the broader business world once you graduate. I suggest demonstrating authenticity, likability and a record of success in the application process – this will cultivate advocates on the admissions team.
“Full-tuition scholarships are typically awarded to candidates who are strong across the board,” she wrote.