Business school candidates should take rankings into account as they contain an enormous amount of useful data, but applicants should also take time to study their methodology. Rankings should not be viewed as the most important aspect when choosing a school, and are simply one element to consider.
One of the earliest rankings of American MBA programmes was published by BusinessWeek in 1988. Since then, many media organisations have jumped on the bandwagon and entered the business of creating MBA school rankings. Rankings add value to a publication’s profile, potentially attracting further advertisers, including business schools. The most prestigious MBA rankings are those of the Financial Times, Forbes magazine, The Economist, BusinessWeek, The Wall Street Journal, and US News & World Report. These publications examine different aspects of business education and the professional development of business school alumni. The goal of the rankings is to express the partial and overall quality of MBA institutions in quantitative terms. What candidates should take into account, however, is that certain criteria may be subjective, survey methodology is not always perfect and the results do not necessarily reflect the needs of a given prospective student. Some degree of critical attitude towards rankings is therefore recommended.
“…The originator’s primary intent in developing a ranking is to sell advertising space and news media.” (Timothy Devinney, Grahame R. Dowling and Nidthida Perm-Ajchariyawong, The Financial Times business schools ranking: What quality is this signal of quality? European Management Review 2008, 5)
Moreover, rankings are not a substitute for individual research and effort in finding the right school. They are useful as an informational resource and for orienting future students on the opportunities available at business schools around the world. Some arguments support their use as helpful tools for candidates; others imply that their increasing popularity is a two-edged sword for prospective students and business schools alike.
Rankings do give some idea, albeit not a perfect one, of where a school stands. It is important for an institution to remain stable in the listings in different years. A swing of ten, twenty or more positions over a couple of years shows an inconsistency in one or more of the aspects taken into account by the ranking methodologies. However, whether this is the fault of the school or simply that the ranking methodology itself is confusing and inaccurate is open to debate. As John A. Byre from poetsandquands.com points out with regard to the Financial Times 2011 rankings, “…at least 40 schools out of 100 listed […] had either double-digit increases or decreases in their ranks… Tulane University’s Freeman School, for example, fell at least 40 places from 61st in 2010 to off the list of 100 this year. McGill University’s Desautels School of Business jumped 38 places to 57th from 98th in 2010. A dozen schools had changes in ranks of 25 places or more.”
This accurately depicts the main problem: instead of actually reflecting the quality of education, rankings tend to set controversial standards, to which schools may try to respond in order to gain more publicity. The result is that some universities become more and more involved in managing aspects of performance that would give them a higher ranking rather than concentrating on academic excellence and criteria. Rankings are resigned to the phenomenon of a self-fulfilling prophecy – they are regarded as important because they are perceived as important.
MBA graduate salaries and pay-packet increase post-MBA comprise 40 percent of the ranking for the schools in the Financial Times rankings, arguably the most popular business school list. The rankings take into account three years of professional experience of former MBA students. The other twenty components measured concern business school diversity and international reach, the MBA programme and research capabilities. A total of 108 schools and more than 8,000 graduates participated in the Financial Times study.
The Economist’s business school ranking methodology comprises four components: new career opportunities account for 35 percent of the overall result, personal development and education experience 35 percent, increase in salary 20 percent, and networking potential 10 percent. A total of 115 schools and 18,712 students and graduates took part in the study; 80 percent of the data was based on information provided by schools and 20 percent by students and alumni.
Forbes has three rankings: US schools, non-US one-year schools and non-US two-year schools. Its methodology is based entirely on ROI and examines the last five years of graduates. A total of 4,080 alumni from 103 schools took part in the Forbes survey.
BusinessWeek’s rankings are based on the opinions of students and corporate recruiters, each representing 45 percent of the final result. The remaining 10 percent is represented by intellectual capital: publications from the schools’ faculties in reputable academic journals. A total of 680 recruiters and 26,389 graduates inform the BusinessWeek rankings.
With such volatility in school rankings, emphasis should not be placed on whether a school is at number 5 or 8, but rather that it is in the top 10, top 20 or top 50, etc. Beware of uncritically projecting good results for a year or a couple of years into the future and turning them into the decisive factor for your choice of educational institution. Students aiming to apply for entry to a top school should also consider their individual profile and career goals and find a school that is the right match for these criteria. It is important that the school is renowned in a given field. An applicant with interest, skills and experience in information technology who selects a school that excels in accounting will not achieve an optimal MBA result – unless they are considering a career change, of course.
Just as for ROI, our advice would be to keep an eye on the rankings but not to confuse their popularity with their legitimacy. All the schools in the top 100 are very good schools. Be sceptical towards rankings that provide insufficient information on their methodology. A better guarantee for quality is the school’s accreditation. There are three main accreditation agencies: the Association of MBAs (AMBA); EQUIS, managed by the European Foundation for Management Development (EFMD); and the Association to Advance Collegiate Schools of Business (AACSB). Accreditation certifies that certain academic standards are met in programmes and in schools. More information about the different masters accreditations can be found on page 102 in the Access Masters Guide 2011.