Most students join an MBA program for the following reasons:

  1. A simple graduation does not fetch a decent job
  2. Having done Bachelors in Business Administration, there is little choice but to do an MBA
  3. Extending their academic life by two more years
  4. Go far away from their parents and relatives to a place where no one knows them
  5. After doing an MBA, the salary levels would increase dramatically.

Reasons 1 to 4 are legitimately related to the reality of your past.

Reason 5 is a prediction of the future.

But do we know the future and do we know what determines salaries of an MBA?

The salaries are determined by the ability of the placement cell or your own contacts to approach the right companies.

The salaries are also based on the demand and the supply of MBAs. More the demand, higher the salary. More the supply, lower the salary!!

What determines demand?

  1. The college ranking determines the demand not because the students learn better stuff in those colleges, but your ranking in the various exams show that you are hard working or smart or both. Your ranking determines the college you get.
  2. Your own intelligence, attitude and transferable skills determine demand
  3. The business climate determines demand. If the markets are not looking good, there is no growth and there is less demand. But markets go in cycles, and if today the market is bad, by the time you pass out, the markets may look up.
  4. The state of the recruiting company determines demand. A growing company needs more MBAs than a mature company.
  5. The alumni of the B-school determines demand, based on how they are doing in the market.
  6. Your specialization in the B-school may determine demand, but this is debatable.

What determines supply?

Let us qualify supply in terms of quality and quantity. Fly-by-night operators may offer a cheap MBA, but they also take short cuts in education and placement. Quality is determined not just by the courses offered and the course content, but the quality of the classroom interaction and more importantly, how serious is the faculty member in imparting an education. There are more than 4500 MBA/PGDM programs in the country.

How do we select the right one?

  1. Is the top salary offered to a graduate the right criteria?
  2. Are you similar to that top graduate who got a great salary, or are you assuming that you will be?
  3. Is the same company coming with the same job offer?
  4. Are the market conditions the same?
  5. Are you doing the same specialization and are you qualified for that specialization?
  6. Should you not ask what is the mode (which salary band and what type of job profile did most students get ?).

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