The Alternative M.B.A.: One-Year Master's Degrees
Shane Torchiana was working in asset management in a job focused on global-fixed income, but he wanted to make the leap to analyst and eventually become a fund manager.
Jodi Hilton for The Wall Street JournalShane Torchiana chose a master's degree in finance over an M.B.A. to boost his career in asset management.
His first thought was to apply to a traditional two-year M.B.A. program. But he believed he didn't need years of general management training in order to get the specific career he wanted. After researching his options, Mr. Torchiana opted for a master's degree in finance at the Massachusetts Institute of Technology's Sloan School of Management, a new yearlong program launched this year.
"It might be a lesser-known type of program, but in terms of quantitative finance skills and the shorter time period, it wins," says Mr. Torchiana. He says he is learning finance at a detailed level he couldn't get in a typical M.B.A. program—including some doctoral-level coursework.
More students are looking to business schools for shorter and more focused alternatives to the M.B.A., with in-depth education in everything from science of management to international finance. Schools, in turn, are beefing up the specialty programs they already offer and adding more to keep up with demand.
These programs, which usually are 12 months long, often include elements of the typical M.B.A. curriculum (classes in finance or advanced mathematics skills are common), but are often more technical and focus less on general managerial skills.
"The master's in finance degree isn't designed for broader management positions," says Debra Luchanin, program manager of MIT's master's in finance program. "We're gearing students up for more specialized quantitative positions, such as asset management."
Growing Appeal
For those without the five years of work experience most M.B.A. programs require, specialized business degrees offer entrance to students with just a year or two of experience. There are an array of degrees for those set on a specific career path. The Association to Advance Collegiate Schools of Business, the main business-school-accrediting agency, reports that the number of such programs is on the rise. For the 2008-09 school year, 645 such programs were offered, up from 614 two years earlier. In the 2006-07 school year, enrollment in these programs was 24,527; in 2008-09, that increased to 29,907 students enrolled.
Many of these programs are still small—including MIT's new finance program, which is in its first year. The current class is just 27 students, although the school plans to eventually expand that number to 60.
This year, Tufts University has 31 students in its master's in international business class—its first year offering the program. Tufts is positioning its program as an alternative to an M.B.A., which the school doesn't offer. The program is as long as an M.B.A. and requires core business classes, such as corporate strategy, accounting and finance. But classes are globally-focused, with courses in international politics and international negotiations and electives focused on regional issues around the world.
"We want to empower those students who want to work abroad [in business] after graduation," says Stephen Bosworth, dean of Tuft's Fletcher School of Law and Diplomacy.
Christopher Barron, a first-year student in the program, applied to M.B.A. programs, too. But it was the opportunity to dig deep into agricultural economics abroad that swayed him toward Tufts. Already, he has detailed his ideal career trajectory with a career counselor—including working in the agricultural sector in Brazil—and he is targeting individual companies that dovetail with his interests and geographical preference.
"The school is small, but [it] helps us leverage our specialized degrees with equally specialized employers," he says.
Bentley University, located in Waltham, Mass., has offered specialized business-related degrees for nearly 30 years—and it has plenty of traction with employers. Nearly 100% of its 2009 graduates with degrees in human factors in information design–a combination of technology, product design and human behavior studies–information technology, financial planning, accounting and taxation had jobs three months after graduation. Nearly 90% of its marketing analytics graduates had jobs.
Cass Business School in the U.K. offers 18 master's programs, dubbed MSc degrees, in subjects such as investment management and management. The curriculums are similar to the M.B.A., but are geared toward students with less work experience says Susan Roth, director of Cass's MSc programs.
"These programs are a deep dive into subject areas," Ms. Roth says. "You won't get marketing or strategy, but you may get all finance, all the time."
Specialized Jobs
When it comes to finding a job post-graduation, these specialized business degrees can offer an advantage and a disadvantage all at once.
For starters, they aren't as well-known as the M.B.A., so general management jobs will be harder to get. But for specialized jobs, like business-specific analyst positions, recruiters will often eschew two-year students for specialty graduates.
Many of the MSc graduates at Cass meet with some of the same recruiters as M.B.A. students do, but recruiters don't plumb the MSc class for the same general positions. Instead, they look to the specialized students for international banking, investment management and financial mathematics positions.
"The MSc students have specific knowledge—it's like knowing how investment management is done versus just understanding how business is done," she says.
Niyati Gupta, a student in Bentley's human factors in information design program, says the specialized degree has a strong business core that is well-received with potential employers.
"What I bring to the table is expertise in researching and evaluating consumer behavior," she says. "I can make recommendations for Web sites, medical devices, financial software."
Ms. Gupta has received a job offer from a technology consultancy firm and expects more before year's end.
Paul Sorbera, president of New York finance recruiting firm Alliance Consulting, has seen the number of candidates with alternative degrees, particularly in finance, increasing. Mr. Sorbera, who recently sought a risk manager for a hedge fund, said the hiring firm preferred candidates with specialized degrees.
"The M.B.A. is preferred, generally speaking, but there are other factors that are important," he says. "A degree with a heavy quantitative focus may edge out an M.B.A. for a trading position."
To be sure, M.B.A. students still get the lion's share of the economic benefits of an advanced degree. According to the Graduate Management Admission Council, students with a full-time M.B.A. reported a 73% increase in salary post-graduation. Students with a master's in a business-related subjectreported a 26% increase.
Mr. Torchiana, the MIT student, admits that he isn't sure what sort of paycheck his degree will reap. "I certainly hope this will translate to a good salary," he says. "But for the skills I want to propel my career—this wins over the other options."
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