Poets and Quants

Harvard Business School retains its No. 1 ranking in the new 2011 PoetsandQuants list of the best MBA programs in the U.S.

Dimming prospects of employment on Wall Street may be causing some jitters on campus, but the mood at the Harvard Business School is decidedly upbeat. Many students came back from their summer internships with lucrative job offers in hand, and for the first time in the school’s history, the entire first year class of some 900-plus MBA students is about to embark next month on an eight-day global immersion experience.

“We are feeling the pressure of final exams and projects,” says Jehan deFonseka, a second-year student who is also editor of The Harbus, the B-school’s student newspaper. “One of my professors, Joe Lassiter, gave us the advice, “Die exhausted, not bored.” So far, this year has lived up to that belief.”

And now the school is about to get a pre-holiday present of sorts. For the second consecutive year, Harvard Business School bested all other business schools for having the best MBA program in the U.S., according to the new 2011 ranking by PoetsandQuants.

Like the first last year, this second annual P&Q list is a composite of the five major MBA rankings published by Bloomberg BusinessWeek, The Economist, The Financial Times, Forbes, and U.S. News & World Report. The ranking takes into account a massive wealth of quantitative and qualitative data captured in the five major lists, from surveys of corporate recruiters, MBA graduates, deans and faculty publication records to median GPA and GMAT scores of entering students as well as the salary and employment statistics of the latest graduating class.

THE P&Q COMPOSITE LIST TENDS TO ELIMINATE THE ANOMALIES IN OTHER RANKINGS

By blending these rankings using a system that takes into account each of their strengths as well as their flaws, we’ve come up with what is arguably the most authoritative ranking of MBA programs published. The list, which includes the recently released 2011 rankings by The Economist, tends to eliminate anomalies and other statistical distortions that often occur in a single ranking. In any case, the ranking measures the overall quality and reputation of the flagship full-time MBA programs at the schools, rather than the schools themselves.

Right behind Harvard is a familiar group of world-renown schools whose MBAs have long represented the best and brightest in business. Stanford Graduate School of Business is second, the University of Chicago’s Booth School of Business is third, the University of Pennsylvania’s Wharton School is fourth, and New York’s Columbia Business School rounds out the top five.

Among the top ten, eight schools retained their rankings from last year. The two exceptions: MIT Sloan moved up to a fifth place tie with Columbia Business School from eight last year, largely due to a significantly improved ranking from Forbes. Dartmouth College’s Tuck School, despite receiving a No. 1 rank from The Economist this year, slipped two places to a rank of eighth from sixth, primarily because the school fell several places in the rival Forbes ranking. Poets&Quants’ ranking of the 50 best MBA programs outside the U.S. will be released shortly.

A FAR MORE STABLE–AND ULTIMATELY MORE CREDIBLE–RANKING OF THE BEST MBA PROGRAMS

Compared to most other rankings, the P&Q analysis leads to a far more stable–and therefore more credible–list. Only 11 of the 100 ranked U.S. schools experienced double-digit changes. In some other rankings as many as one out of three or four schools randomly dive or rise by ten or more places in a 12-month period, even though there have been no significant changes in the quality of the schools. In the P&Q ranking, not a single MBA program ranked in the top 25 had a double-digit increase or decline. In fact, 16 of the 25 schools had no changes in rank at all and another three schools moved just one place up or down (see table of top 25).

Among the top-tier 25 schools, the most notable improvements occurred at the University of Wisconsin at Madison, which moved up six places to a rank of 24 from 30th a year ago, and at Vanderbilt University’s Owen School, which inched up three spots to 25 from 28 a year earlier. New York University’s Stern School, meantime, slipped three positions to a rank of 15 this year from 12th in 2010.

Bigger changes were most likely to occur further down the list, where the qualitative differences among the business schools aren’t nearly as great as they are at the top of the ranking. So small changes often can cause outsized results because the schools are so close together in overall quality—especially “quality” as it can be discerned by an external ranking. In these cases, the most significant changes tended to occur at schools which were either added or dropped from one of the major rankings in the past year.

BIGGER CHANGES TEND TO OCCUR FURTHER DOWN THE P&Q LIST

Washington University’s Olin School, for example, plummeted 15 places to 41 from 26 because it fell off the top 100 list compiled by The Financial Times, while also losing ground in two others rankings by Forbes and U.S. News & World Report. Similarly, Ohio State’s Fisher School of Business climbed 14 spots to 26th from 40th in 2010 by improving in the Forbes ranking and getting onto both The Economist and The Financial Times’ rankings. The school had been excluded from those lists a year earlier.

What’s most surprising is what you can’t see. It’s the University of Chicago’s continuing emergence as a powerhouse business school. While the school still ranks third as it did in our last ranking, it has gained significant ground. The index score for Booth this year is 98.5, just .3 behind Stanford Graduate School of Business. A year ago, the difference in the index score between Stanford and Chicago was twice that level. If Poets&Quants kept its methodology the same, Chicago would would have nudged aside Stanford as the No. 2 school in the ranking. Because P&Q decreased the weight of BusinessWeek’s ranking (to 25% from 30%) and increased the weight of U.S. News’ ranking (to 25% from 20%), Stanford maintained its 2010 position.

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