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BusinessWeek’s 2008 MBA Rankings

The granddaddy of the MBA rankings, BusinessWeek’s Best-B Schools list made its debut in 1988 with what was then a radical approach to judging the quality of a school: pure customer satisfaction. It was the first to systematically survey recent MBA grads and ask them about their satisfaction levels with their educational experience and the first to ask corporate recruiters their opinions of the MBAs they interview and hire. To adjust for possible one-year bias, BusinessWeek includes in its ranking the two previous MBA grad and recruiter surveys.

BusinessWeek has since added an intellectual capital measurement, which gets 10% of the overall weight in the ranking. This latter survey examines the contributions of faculty in 20 academic journals as well as book reviews of faculty books in The Wall Street Journal, The New York Times, and BusinessWeek. BusinessWeek ranks 30 schools and then alphabetically names another 15 schools it puts in the “second-tier.” The ranking is published every other year, in October, in even-numbered years. So the next ranking will be published in October of 2010.

A confession here is warranted: I created these rankings when I was management editor of BusinessWeek magazine in the late 1980s. I also supervised BusinessWeek’s coverage of graduate business education for many years, reported and wrote four editions of the BusinessWeek Guidebook to the Best Business Schools, and also built out BusinessWeek’s online MBA and executive education franchise in the mid-1990s. So my analysis is not without a degree of bias. Still, I’ve tried to be as objective as humanly possible in my analysis of the survey’s strengths and weaknesses.

Pro: The ranking does not rely on less reliable data from schools which are under pressure to report information in the best positive light. It does not include such factors as GMAT scores, undergraduate GPAs, or starting salaries, but makes the case that discriminating graduate students and the companies that hire recruiters are in the best possible position to judge the quality of a school. BusinessWeek does not try to stretch the data it gathers and rank more than 30 schools. Instead, it creates a “second-tier” group of schools, acknowledging that differences among those schools are statistically inconsequential.

Con: It’s an entirely U.S.-centric list that excludes some very good schools outside the U.S.  It’s also possible that a graduating class of MBAs, knowing that their answers will affect the ranking of their school, may be encouraged to report more positively on their experience than is warranted. The upshot: small differences in MBA opinion could and often does affect a school’s standing. BusinessWeek clearly knows this is a possibility because the magazine employs statisticians who “use a series of statistical analyses to test the responses for patterns that have a low probability of occurring if the students are answering the questions honestly.” If foul play is suspected, the surveys are tossed out of the calculation. There are many indicators of quality, such as GMAT scores of incoming students and post-MBA compensation, which are not included in this ranking.

Another significant issue with the survey is that smaller schools, which naturally attract fewer corporate recruiters because they have a smaller supply of graduating MBAs to offer the market, are naturally disadvantaged in the ranking. Over the years, BusinessWeek has tried to address this problem but has never found a truly adequate solution to eliminate this bias. It’s a major reason why smallish Stanford’s Graduate School of Business is behind Michigan, why MIT’s Sloan School is behind Duke, and why Dartmouth’s Tuck School is ranked 12th when Forbes rates Tuck number two. In some instances, differences in the ranks accorded the schools can be without statistical significance. Yet, you cannot tell if that’s the case because BusinessWeek does not publish index numbers for each school that shows how large or small the differences are between one rank and another.

Here’s the list of BusinessWeek’s top schools and how they compare on other major rankings:

BW Rank & School P&Q Forbes U.S. News FT Economist
1.  Chicago (Booth) 3 4 5 9 4
2.  Harvard Business School 1 3 1 3 5
3.  Northwestern (Kellogg) 7 8 4 22 15
4.  Pennsylvania (Wharton) 4 5 5 2 9
5.  Michigan (Ross) 12 18 12 28 25
6.  Stanford School of Business 2 1 1 4 7
7.  Columbia Business School 6 6 9 6 20
8.  Duke (Fuqua) 11 13 14 20 28
9.  MIT (Sloan) 8 14 3 8 19
10. California-Berkeley (Haas) 9 12 7 28 3
11. Cornell (Johnson) 14 7 18 36 32
12. Dartmouth College (Tuck) 5 2 7 14 6
13. New York (Stern) 10 17 9 13 13
14. UCLA (Anderson) 16 19 15 33 50
15. Indiana (Kelley) 20 25 23 57 46
16. Virginia (Darden) 13 9 13 31 24
17. UNC (Kenan-Flagler) 18 15 21 46 39
18. Southern Methodist (Cox) 29 33 49 96 88
19. Carnegie Mellon (Tepper) 17 23 16 34 33
20. Notre Dame (Mendoza) 25 38 31 71 34
21. University of Texas-Austin 19 11 16 52 49
22. Brigham Young (Marriott) 22 16 33 83 NR
23. Emory (Goizueta) 21 22 27 34 52
24. Yale School of Management 15 10 11 16 27
25. Southern Cal (Marshall) 23 32 20 57 36
26. Maryland (Smith) 27 29 45 43 51
27. U. Washington (Foster) 28 40 33 78 31
28. Washington U. (Olin) 26 41 19 50 65
29. Georgia Institute of Tech 32 44 26 NR NR
30. Vanderbilt (Owen) 30 30 36 57 64
ST  Arizona State (Carey) 42 56 27 89 NR
ST  Babson College (Olin) 49 NR 54 99 NR
ST  Boston University 40 61 31 61 NR
ST  Georgetown (McDonough) 24 31 24 38 48
ST  George Washington Univ. 50 73 55 57 NR
ST  Michigan State (Broad) 35 21 46 65 NR
ST  Ohio State (Fisher) 34 39 21 67 45
ST  Purdue (Krannert) 41 45 36 54 NR
ST  Thunderbird NR NR 62 67 84
ST  Univ. Calif.-Irvine (Merage) 44 58 36 72 NR
ST  Univ. of Connecticut 38 27 79 NR NR
ST  Univ. of Illinois-Urbana 48 63 42 52 87
ST  Univ. of Iowa (Tippie) 33 20 42 64 61
ST  Univ. of Minn. (Carlson) 31 26 24 75 62
ST  Univ. of Rochester (Simon) 36 37 27 48 77

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Footnotes: NR means not rated by the publication. ST means “second tier,” the rating given to 15 schools by BusinessWeek after it ranks the top 30.

Source: BusinessWeek, 2008 ranking