For Northwestern University’s Kellogg School of Management Dean Sally Blount, it couldn’t have happened at a better time. After being dean of the school for seven years, she opened the doors to a new $250 million Global Hub on the shores of Lake Michigan. Now, for the first time under her watch, Blount can claim a number one ranking for the school’s prestige MBA program–seven months before she steps down from her job at the end of the 2017-2018 academic year.
Kellogg toppled Chicago Booth to capture first place in the new global ranking from The Economist today (Oct. 26), nudging aside its arch-rival Booth which had held the top title in the ranking for five consecutive years. Though Kellogg only had to gain one place to knock out Booth this year, it’s No. 1 status caps a long, upward climb in this topsy-turvy, unpredictable ranking. In the past five years, Kellogg went from finishing 23rd in 2013, to 14th the following year, to seventh in 2016, and to second place last year before finally emerging the big winner.
The Economist list is the fourth of the five most influential MBA rankings to come out this year. It follows the Financial Times in January, U.S. News & World Report in March, and Forbes in September. INSEAD capped the FT list this year, while Harvard Business School and Wharton shared top honors in U.S. News, and Wharton also claimed the No. 1 spot in Forbes for the first time ever. The last and final big brand list from Bloomberg Businessweek is expected to make its appearance in mid-November, most likely on Nov. 15.. Poets&Quants will then quickly follow with its composite ranking before the end of next month.
WHARTON HAS RACKED UP MAJOR ADVANCES IN THIS YEAR’S RANKINGS
Right now, however, the spotlight is on The Economist‘s perspective of MBA programs. After Kellogg and Booth, Harvard Business School edged a place higher this year to rank third. Continuing its highly successful rankings year, the Wharton School of Business rose eight places to finish fourth, just ahead of No. 5 Stanford Graduate School of Business. UCLA’s Anderson School of Management also jumped eight spots to rank sixth. The University of Michigan’s Ross School of Business gained nine positions to finish 12th. The first non-U.S. MBA program to pop up on the list is HEC Paris with a rank of 15th.
Of all the most-watched rankings, The Economist tends to make business school administrators positively dizzy. That is largely because of the big year-over-year swings on the list. This year is no exception. Some 27 of the 100 schools ranked by The Economist experienced double-digit changes. If you add two of the four schools that fell off the 2017 list, there are 29 MBA programs with double-digit dips or jumps.
Typically, such dramatic changes occur further down on rankings as the data used to crank out a numerical rank thins and becomes less reliable. More often, rankings show only small changes year-over-year among the top 10 to 20 schools. Not so with The Economist‘s oddball MBA ranking. This year, only two of the Top 25 schools maintained their year-earlier ranks. The 23 remaining programs saw changes that ranged from a gain of 20 places–the University of Florida’s Hough School of Business–to a loss of nine positions–IESE Business School in Spain–in a single year. The average movement for a Top 25 school this year was five places.
HULT INTERNATIONAL RANKS HIGHER THAN CAMBRIDGE OR OXFORD
But what also causes B-school deans headaches is The Economist‘s head-scratching conclusions. This year, for example, Hult International School is ranked above both Cambridge University’s Judge Business School and the University of Oxford’s Said Business School. The Economist ranks Hult as having the 54th best MBA program in the world, just one spot ahead of Cambridge at 55th and 21 places in front of Oxford! Yes, you read that correctly: Hult, a school that only gained accreditation from the AACSB (The Association to Advance Collegiate Schools of Business) in June, trashes Oxford by 21 positions.
How can The Economist, a widely respected weekly, come out with such a dubious ranking? The peculiar results are fundamentally a function of the magazine’s methodology. While it is similar in some ways to the ranking by the Financial Times, its results are often dramatically different. Both of these British-based publications produce rankings that are global in scope and weigh several factors that tend to favor non-U.S. schools. But The Economist examines the most criteria—21 different metrics in all versus the 20 at the FT–from the diversity of the on-campus recruiters to the range of overseas exchange programs. Compensation and career placement are heavily weighted, including starting salaries, pre-MBA versus post-MBA pay increases, and the percentage of graduates who land jobs through the career management center. Pay and placement account for 45% of the methodology.
The one big difference with the Financial Times is The Economist’s rather significant reliance on student satisfaction, gathered by an annual survey of current MBA students and recent alumni. They’re asked to rate the quality of the faculty, the career services staff, the school’s curriculum and culture, the facilities, the alumni network, and their classmates. The methodology takes into account new career opportunities (35%); personal development/educational experience (35%); increasing salary (20%); and the potential to network (10%). The figures are a mixture of hard data and the subjective marks given by the school’s students who are aware that their answers will result in a ranking that could reflect on the reputation of their degrees.
HARVARD, STANFORD & WHARTON HAVE NEVER BEEN NO. 1 IN 16 YEARS OF ECONOMIST RANKINGS
Measuring MBA programs on those dimensions should insure that Harvard, Stanford, Wharton and London Business School do well. Yet surprisingly, year after year they tend to lag in this ranking. In the 16 years that The Economist has cranked out the most entertaining of the top MBA rankings, Chicago Booth has claimed the most first-place wins, racking up seven. Kellogg is next with four, while IESE can boast a trio of No. 1 victories. Dartmouth’s Tuck School of Business and IMD have each claimed the top spot one time in 2011 and 2008, respectively.
Oddly, Harvard, Stanford and Wharton have never captured the No. 1 position. There are many explanations for this, including the likelihood that students and alumni who complete The Economist‘s survey are cheerleading for their underdog schools, while graduates of the most elite institutions are confident enough not to care. Less credible results also can result from the sample size of the surveys and the fact that some schools have dropped out, refusing to participate in the ranking because they believe it lacks credibility.
Generally, wild swings in a ranking tell you less about the quality of a school’s MBA program than it signals about the methodology of the ranking itself. After all, schools rarely if ever change much year over year. In fact, a school’s standing should generally be fairly stable over even longer periods of time, unless there is an aggressive effort to boost a school or a scandal or mishap. So when there are unexplainable changes in a ranking, it’s more often a sign that the methodology is severely flawed and lacks statistical validation. Often times, for instance, the underlying index scores–which The Economist does not reveal–are so close together that inconsequential changes in just a few measurements can send a school soaring or plummeting.