Business School Rankings Lose their Luster

Business school rankings seem to be losing some of their verve as they are published increasingly regularly by different sources.

With Wharton topping the latest Financial Times (FT) rankings once more and Chicago leading the latest Business Week (BW) rankings, their Deans should be popping champagne. Dipak Jain, Dean of Kellogg, which was deposed from the top perch of BW, should be suffering anxiety attacks.

The reality however, is that Business School officials have become more sanguine about rankings in recent years, as the proliferation of rankings reinforces their skepticism and as they realize that rankings seem to be steadily losing their impact with MBA applicants around the world. Although The Wharton School still tops rankings, Dean Pat Harker argues "Some people believe that if the rankings help us, who cares if they are flawed or give a limited view of the school? But we can't have it both ways. We either endorse a defective, inconsistent practice, or we speak out and "work with the media to enable them to report with more useful, objective data." In addition, according to TopMBA.com, who conducted a 6000 strong survey of potential business school applicants who attended the QS World MBA Tour last year, business school rankings are no longer the major factor behind a student's choice of MBA programme.

The most important factor is a school's reputation, followed by the success record of its career placement office, return on financial investment, the availability of scholarships and other financial aid and the range of subjects in which the school specialises. The survey asked "what are the key factors behind your choice of school". The ranking of the school was only the sixth most important factor. What should applicants make of rankings produced by the FT, Business Week, The Wall Street Journal - or the personalized ranking produced by TopMBA.com?

Nunzio Quacquarelli of TopMBA.com says "First, do not rely on the final ranking to create your own order of preference for schools. Look at the numbers behind the rankings and decide if the criteria are important for you. If you compare the top schools in each survey, they are remarkably consistent. Schools move up and down from year to year, and from ranking to ranking, because there is no single, objective, ranking of the best MBAs." The FT ranking of full-time MBAs, published on the 29th January 2007 contains no input from recruiters in their survey, but places a heavy weighting on "Weighted Salary three years after graduation", followed by "Research Rating" and a rating of the "Number of Doctoral students" produced by the school. Compared with Business Week and the Wall Street Journal, the FT is more global in scope, directly comparing American and international MBA programmes.

Limitations of the FT methodology revolve around the validity of directly comparing one and two year programmes. In addition, the heavy emphasis on salary three years after graduation can bias results in favor of schools with strong ties to the investment banking industry (which tends to pay the most at this stage of alumni careers) - hence the resultant bias in US schools towards East-Coast rather than West-Coast or Mid-State schools.

This year, Judge Business School has risen 20 places to 15th in the FT, whilst Schulich - York University has fallen 31 places to 49th. Quacquarelli goes on to say, "Beyond a few top schools, there is a lack of consistency between the various rankings. What accounts for this lack of consistency? The answer is: the different methodologies employed by each ranking.

Any informed attempt to make use of rankings must begin with a basic understanding of the methodologies employed." Kim Keating at Tuck, 9th in this year's FT survey, argues "the best way to approach the major rankings is to look at them as a whole and study the different aspects and attributes that each one is surveying." Joern Meissner, a professor of Decision Sciences at Lancaster University Management School agrees. "Lancaster does well in several rankings, but not others. All rankings are of limited value because the factor weightings are applied by one decision maker - the ranker - and don't necessarily reflect the needs of the majority of applicants."

Table 1:Comparison of Latest Business School Rankings Research

TopMBA.com
Scorecard (4 Sept.'06)Financial Times
(29 January '07)Business Week
(23 October '06)Wall Street Journal 
(20 Sep. 2006)"Top 20" - US
(Alphabetical)"Top 20" - US
(Ranked)"Top 20" - US
(Ranked)"Top 20" - US
(Ranked)BerkeleyWhartonChicagoMichiganCarnegie-MellonColumbiaWhartonDartmouth - TuckChicagoHarvardNorthwesternCarnegie-MellonColumbiaStanfordHarvardColumbiaCornellChicagoMichiganBerkeleyDartmouth - TuckNYUStanfordNorthwesternDukeTuckMIT SloanWhartonGeorgetownYaleBerkeleyNorth CarolinaHarvardMITDukeYaleMichiganUCLAColumbiaMIT SloanMIT SloanNorthwesternDartmouth -TuckChicagoNorthwesternMichiganUCLADukeNYUDukeCornellDardenPenn. - WhartonBerkeleyNYUHarvardStanfordVirginiaVirginiaSouthern CaliforniaTexas - AustinCornellCarnegie-MellonCornellThunderbirdMarylandNorth CarolinaNYUTorontoNorth CarolinaIndianaStanfordVirginia -DardenEmoryYaleUCLAYaleGeorgetownTexas - AustinThunderbird*TopMBA.com
Scorecard (4 Sept.'06)Financial Times
(29 January '07)Business Week
(23 October '06)

Wall Street Journal

(20 Sep. 2006)

"Top 20" ' Europe"Top 20" - Non-US"Top 10" - Non-US"Top 10" - Non-USCambridgeLondon Bus. SchoolQueen'sESADECASSINSEADWestern OntarioIMDCEUCEIBSTorontoIPADECranfieldIE Inst. De EmpresaIMDLondon Bus. SchoolESADEIMDLondon Bus. SchoolTec de MonterreyHEC ParisCambridgeINSEADW. OntarioIE Inst. De EmpresaIESEESADEINCAEIESEHEC ParisIESEIE Inst. De EmpresaIMDOxford - SaidYorkYorkImperial - TanakaManchester Bus. SchoolHEC MontrealIESEINSEADESADE  London Bus. SchoolToronto  Manchester Bus. SchoolLancaster  MIP Pol. Di MilanoRSM  Oxford - SaidWarwick  RotterdamCranfield  SDA BocconiWestern Ontario  SolvaySDA Bocconi