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So Business Week released their 2012 MBA Program Rankings. Not surprisingly, the top five spots were allocated to Booth, Harvard, Stanford, Wharton, and Kellogg. Each one is impressive, all with their own niche in terms of program focus.

Booth: Theoretical Finance
Harvard: Corp. Leadership
Stanford: Entrepreneurial Leadership
Wharton: Directly Applicable Finance
Kellogg: Advertising

But that brings me to question. How important are these rankings released by news publications? People tend to discredit these rankings due to disagreeing with data source allocation, category weightings and data mining.

Poets and Quants:

Like any other ranking of business schools, it is not flawless. Though BusinessWeek employs statisticians to comb through the data to verify its integrity, students come to each of these schools with very different expectations that can result in significantly different grades they award their institutions. There is also concern of widespread cheerleading by students who want to push their schools ahead in the rankings so their degrees have more prestige. These issues alone are in all probability what has kept Harvard and Stanford from ever placing first in the BusinessWeek survey.

Those students come to campus with high expectations and are less likely to care about how a ranking impacts the status of their degree. So they are prone to be more demanding and more honest in their answers to BusinessWeek's questions. They graduate with the highest starting pay packages and know that a Harvard or Stanford MBA can pretty much open any door in the world.

Source: Poets and Quants

So, how do you view business school rankings? Is your personal view based more on perceived prestige among academia or reputation within a specific industry?

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Comments (22)

  • jtbbdxbnycmad's picture

    The interesting note about this year's BusinessWeek rankings is that they corrected some poor assumptions/oversights in their recruiter survey data crunching side, which smoothed out some of the anomalous or harder-to-swallow results from 2010 (namely, SMU Cox being rated so highly, above solid, even prestigious, schools such as Tuck or Stern). The Top 5 this year is pretty much everyone's top 5 - as always, there will be disagreement whenever HBS isn't number one, but in my mind BW's ranking has an overall shape that approximates broad, popular opinion in a broad brushstroke sort of way, but the individual rankings are the result of more granular analysis.

    My view of business school rankings differs from my view of general undergraduate rankings. While most use "prestige" as the single most important factor for business school rankings (using the reasoning of "well, the education is a commodity and all the students have the same GMAT distribution across the top 10 and get similar jobs, so what really matters is the brand value"), I take an employer-and-compensation driven market approach. (I should add that some folks feel that students are the market and you should look at yield; input matters but I look more at output).

    For me, the short-term career side is incredibly important so the jobs report, employer surveys and career returns are the most important factors, and resultantly I pay more attention to the rankings that emphasize these. More specifically, that means Forbes and BusinessWeek. USNews tends to be cited very often because its undergraduate ranking is the most widely known at a national level (zero currency abroad though), and also because it is the most conservative ranking that uses a comprehensive set of data that almost always results in H/S trading the top spot, and Wharton occasionally ceding the 3rd spot to "the next 3" (Chicago, MIT, Northwestern). This makes sense as the USNews ranking is the one that includes the most admissions-oriented data in its formula, and the schools tend to rank in that order. For USNews, I find all the data amusing, but look at the employer survey and jobs data the most.

    It should come as no surprise that by and large, the top 5 or so in these three rankings include the same schools, and what matters is the order, and that is based on how the formula is computed. BusinessWeek tends to sort those top 5/6 schools in order of short-term job boost/satisfaction; Forbes looks at ROI (though its sample size/data set has obvious shortcomings); and USNews is the best proxy for admissions competitiveness and yield (though the latter can be gamed, with some notable examples).

  • jtbbdxbnycmad's picture

    Oh yeah, the cheerleading note. The interesting for me is to see the difference between Student Cheerleading
    Ranking and Recruiter Satisfaction for BW. Very telling (rank, school, student survey, recruiter survey):

    1 Chicago (Booth) 11 1
    2 Harvard 12 3
    3 Pennsylvania (Wharton) 16 2
    4 Stanford 8 5
    5 Northwestern (Kellogg) 13 4
    6 Duke (Fuqua) 22 7
    7 Cornell (Johnson) 2 12
    8 Michigan (Ross) 14 6
    9 MIT (Sloan) 9 10
    10 Virginia (Darden) 5 9
    11 Carnegie Mellon (Tepper) 3 17
    12 Dartmouth (Tuck) 4 11
    13 UC-Berkeley (Haas) 10 13
    14 Columbia 20 8
    15 Indiana (Kelley) 20 46
    16 NYU (Stern) 7 16

    After Stern I stopped...

    The Top 5, in raw score, are the same schools as the Top 5 in recruiter score. After that it goes a little all over the place. I'm not sure I'd take Duke or Ross over Columbia, so Columbia, and to a certain extent MIT and Tuck, seem to be a bit punished by this ranking.

    It's still a little hokey.

  • pacman007's picture

    Columbia 14th?? Doesn't make sense...

    I'm definitely not liking Rice (Jones) heading down and not up according to BW. That sucks.

    "Don't quit. Suffer now and live the rest of your life as a Champion" - Muhammad Ali

  • In reply to pacman007
    holla_back's picture

    pacman007:
    Columbia 14th?? Doesn't make sense...

    I'm definitely not liking Rice (Jones) heading down and not up according to BW. That sucks.

    Rice will always play second fiddle to McCombs. It's still very well-respected in the energy world.

  • In reply to holla_back
    pacman007's picture

    holla_back:
    pacman007:
    Columbia 14th?? Doesn't make sense...

    I'm definitely not liking Rice (Jones) heading down and not up according to BW. That sucks.

    Rice will always play second fiddle to McCombs. It's still very well-respected in the energy world.

    Well it's actually fourth fiddle according to BW. SMU and A&M rank higher, I am almost certain that no one actually believes that Cox and Mays are better than Jones.

    "Don't quit. Suffer now and live the rest of your life as a Champion" - Muhammad Ali

  • In reply to pacman007
    holla_back's picture

    pacman007:
    holla_back:
    pacman007:
    Columbia 14th?? Doesn't make sense...

    I'm definitely not liking Rice (Jones) heading down and not up according to BW. That sucks.

    Rice will always play second fiddle to McCombs. It's still very well-respected in the energy world.

    Well it's actually fourth fiddle according to BW. SMU and A&M rank higher, I am almost certain that no one actually believes that Cox and Mays are better than Jones.

    Ah, I didn't even know that.

    I would certainly take that with a grain of salt. I don't know a single person who would argue that either of those schools are better than Rice.

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  • Macroecon's picture

    The top 5 is right with the exception of booth being #1. Not even booth students think their school is better than HBS or Stanford. After the top 5, the ranking quickly falls apart and goes into bizarro territory. Duke at #6, Cornell at #7, and Ross at #8 is really weird. Regardless, almost no one takes those schools over mit, tuck, columbia, and i don't think that's going to change because of this ranking. At the end of the day, b-school applicants have a very clear idea of what the "real" ranking is and what type of opportunities are available at those schools.

  • lasampdoria's picture

    Why is Yale SOM ranked so low? Did not even make the top-15.

    Thoughts?

    "Those who can give up essential liberty to obtain a little temporary safety, deserve neither liberty nor safety."- Benjamin Franklin

  • In reply to lasampdoria
    cphbravo96's picture

    lasampdoria:
    Why is Yale SOM ranked so low? Did not even make the top-15.

    Thoughts?

    Probably because they didn't buy their soccer cleats from the most trusted brand names!!

    I would have to say this list is pretty much junk, unless you sort by employer. It seems their methodology is a bit funky and questionable.

    I was trying to find what the composition of 'Intellectual Capital' is, but had no luck. With that said, I'm trying to figure out just how Darden comes in at 32? I just don't buy that Olin, Smith, Hough and Carlson have more intellectual capital.

    If you want a pretty decent ranking, just check out the one done by Poets and Quants. I think they have a pretty solid list.
    http://poetsandquants.com/2011/12/08/the-top-100-u...

    As far as your original question, it's really hard to say. The list clearly isn't accurate, in the traditional sense, so I wouldn't take it too hard. I think Yale is an up and coming program that has a lot of ground to cover. Maybe they will be a top 10 school one day but I do think your ability to move up the ranks is very limited. Just look at the top 4 or 5 schools for the last several years. They are virtually always the same, with just a move up or down by a spot or two. When the first 5, or 7, spots are occupied, the 5-10, or 7-10, spots are going to be hard to move into...which is why you have people structuring schools in tiers instead.

    Regards

    "The trouble with our liberal friends is not that they're ignorant, it's just that they know so much that isn't so."
    - Ronald Reagan

  • SanityCheck's picture

    Businessweek rankings are always horrible. I remember their ugrad bschool ranking putting Villanova in front of Wharton/Stern or something ridiculous like that.

    There's no way MIT or Columbia is that low. Booth/Cornell are also too high.

  • In reply to cibo
    SirTradesaLot's picture

    cibo:
    pacman007:
    Columbia 14th?? Doesn't make sense...

    http://gawker.com/5666747/columbia-business-school...

    That's why.


    Unrelated note, but in this article next to the one about Columbia's uncleanliness (http://gawker.com/5961260/the-most-important-detai...), I found this gem in the comments:

    "I'm reminded of the time I was at my father-in-law's country club a few years back. The place was full of stuffy yuppies so I thought it would be really funny to discretely poop in the pool, let it drop out of the leg of my trunks, and then get out and enjoy the ensuing chaos. I swam to the deep end where no one was swimming and emptied my bowels. Unfortunately I had not taken into account that I had only eaten oysters and coffee that day, so instead of a solid log my stool came out as an oily black cloud. People started immediately yelling and pointing. I wasn't close enough to anyone to blame someone else, so instead tried to look confused and disgusted like I had accidentally swam into a poop cloud that was already there. I could tell by their eyes that they did not believe me.
    Anyway, love that this site covers pantshitting issues, there certainly isn't enough of that on the internet. Keep up the good work!"

    adapt or die:
    What would P.T. Barnum say about you?

    MY BLOG

  • DoubleBottomLine's picture

    obviously this ranking is a joke. too many insane examples to mention just within the top 16 listed above. it has no credibility whatsoever.

  • In reply to SanityCheck
    Macroecon's picture

    SanityCheck:
    Businessweek rankings are always horrible. I remember their ugrad bschool ranking putting Villanova in front of Wharton/Stern or something ridiculous like that.

    There's no way MIT or Columbia is that low. Booth/Cornell are also too high.

    Booth should be #4 or #5 while cornell should be #14-15.

  • In reply to lasampdoria
    Macroecon's picture

    lasampdoria:
    Why is Yale SOM ranked so low? Did not even make the top-15.

    Thoughts?

    It's not a great school, period. People have been talking about Yale rising to the ranks of the top 10 in the same way that christian fundamentalists talk about the imminent return of Jesus Christ. Well, guess what. It hasn't happened and most likely won't happen. There is only so much that Dean Snyder can do, and I don't think their new building will help that much either. Fact of the matter is, SOM has a structural disadvantage. First, it's one of the youngest b-schools out there: founded in 1974 but did not even start giving out MBA degrees until like the late 90's or so. Second, as a result of that, Yale's alumni network is small and weak. And finally, it's still not that respected among recruiters, which is what counts.

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  • In reply to lifeofpurpose
    honeyoak87's picture

    Morpheus: Have you ever had a dream, Neo, that you were so sure was real? What if you were unable to wake from that dream? How would you know the difference between the dream world and the real world?

  • In reply to honeyoak87
    SirTradesaLot's picture

    adapt or die:
    What would P.T. Barnum say about you?

    MY BLOG

  • In reply to SirTradesaLot
    cphbravo96's picture

    "The trouble with our liberal friends is not that they're ignorant, it's just that they know so much that isn't so."
    - Ronald Reagan