Effects of the MBA programme on psychological contracts and turnover

Abstract

The need for this research stems from the unusually high turnover rates in MBA students following the completion of their degrees. Organisations realise the need for further education and for increasing both the human capital of the organisation and the career capital of the individual, but are concerned that the MBA programme may inevitably lead to the loss of the individual, possible to their competition. The report investigates the changes in psychological contracts that occur during the course of the MBA programme and how those changes could consequently lead to an increase in intention to leave. Rousseau’s technical report on psychological contracts is used as the basis of the assessment method for determining the changes in psychological contracts. The study presents findings from 117 MBA students from the GIBS business school. The paper shows that the overwhelming majority of MBA students intend to leave their current employer. The report offers insights for managers planning for their talented employees to enrol in MBA programmes. The researcher concludes by suggesting that understanding the construct of the psychological contract between the MBA student and their employers may increase an employer’s ability to hold on to the brightest stars and obtain the best possible value from the undertaking. Copyright