For the first time in the five years that the Financial Times has ranked online MBA programs, perennial also-ran Warwick Business School toppled Spain’s IE Business School to land in first place. This year’s ranking, limited in scope to just 20 programs in the world, includes 14 U.S. business schools, four in Europe, and one in Australia and Peru.
Many of the best online options are missed by the FT in its ranking, including Carnegie Mellon’s Tepper School of Business, UNC’s Kenan-Flagler Business School, UT-Dallas’ Jindal School of Management and Imperial College Business School in London, because the vast majority of schools decline to participate in the ranking or aren’t old enough to be considered. In the 2018 FT ranking, for example, only 22 schools submited data to be included, down from 25 a year earlier, even though growth in online MBA degrees is skyrocketing.
After No. 1 Warwick and No. 2 IE, the first U.S. entry captured third place: the University of Massachusetts’ Isenberg School of Management. Rounding out the top five were Indiana University’s Kelley School of Business and Durham University Business School in the United Kingdom. Among the ranked schools, Warwick boasts the largest program, with nearly 1,300 students. Unlike most other programs, moreover, some 850 students at Warwick come from outside the U.K. from 106 countries, making it the most internationall diverse online offering in the world.
TRACKING TWO KEY CAREER OUTCOMES: SALARY INCREASES & CAREER PROGRESS
Finishing in the FT’s top ten this year were the online MBA offerings from No. 6 Babson College, No. 7 University of Florida’s Hough School of Business, No. 8 Australian Graduate School of Management, No. 9 Arizona State University’s W. P. Carey School of Business, and No. 10 George Washington University.
In Poets&Quants recent debut online MBA ranking, which only listed U.S. options, unranked Carnegie Mellon was first, followed by Indiana Kelley in second place, with the Florida’s Hough Graduate School of Business at No. 3, the Dallas’ Jindal School of Management at No. 4, and the University of North Dakota at No. 5. Unlike the Financial Times, the P&Q ranking puts much more significant emphasis on a program’s admission standards and the quality of students it ultimately attracts.
While the small size of the FT ranking may give it limited value to would-be applicants to online programs, there are some aspects of the ranking that stand out. Among other things, the FT tracks two key career outcome measures—the increase in a graduate’s base salary three years after graduation as well as their satisfaction with the progress they have made in their careers since getting the MBA.
TOP ONLINE MBA FOR SALARY BOOST? NEBRASKA AT LINCOLN
According to the FT’s data, derived from alumni surveys, no school’s MBA did better on helping alums increase their pay than the University of Nebraska at Lincoln. Nebraska alums reported salaries that were 40% higher, significantly more than the 32% average hike across the sample. Though IE lost its No. 1 ranking, its graduates also did exceptionally well in the salary department, reporting an average increase of 39%.
And when it came down to career progress, measured by a graduate’s level of seniority and the size of company they now work for three years after graduation, Warwick Business School came out on top. Interestingly, only one U.S. school was in the top five on this metric: Florida International University’s Chapman Graduate School of Business which placed second. Otherwise, Durham ranked second in career progress, IE was fourth, and the University of Bradford’s School of Management in the U.K. was fifth.
The FT list uses 18 criteria to rank online MBA programs. Alumni responses inform nine criteria that account for 65% of the methodology. The FT uses eight metrics reported by schools that makes up 25% of the weight. Then, the newspaper tosses in a rank of published scholarly research from professors at each school, a measure that accounts for the remaining 10% of the methodology. The data is gathered via a pair of online surveys. Besides the 22 schools that completed the school survey, the FT said that roughly 650 graduates who graduated in 2014 completed the alumni survey, a response rate of 26%.
HOW ONLINE MBA GRADS COMPARED WITH ON-CAMPUS ALUMS
As is typical in FT rankings, graduate compensation looms large. The single most heavily weighted metric is average salary, adjusted for power purchasing parity, three years after graduation. Another 10% of the weight is given to the percentage increase in an alum’s salary. There are a number of weighted criteria that have little to do with the quality of an online program, including the 10% emphasis put on scholarly research. Many of those profs don’t even teach online courses. Another oddball metric, accounting for 5% of the methdology in this ranking, is the number of PhD graduates from a school in the past three years. If anything, a school’s focus on educating PhDs often can weaken a school’s delivery of an MBA program.
This year, the FT added some compelling analysis to its ranking, comparing all the online MBA respondents to those who graduated from residential MBA programs who had completed the surveys. The newspaper found that the average salary of 32% by graduates of online programs significantly trailed the 107% enjoyed by alumni of on-campus programs. Respondents to its online survey reported an average salary of $147,000, up from $140,000 a year earlier, slightly higher than the $146,000 for full-time students. “They have reached similar salaries but at different stages of their careers,” noted the FT. “The online MBA graduates are now about 40 years old on average — six years older than their full-time equivalents — and their salary was about 60% higher at enrollment for their course.”
The average age of an online student is 34, compared to 28 for a residential program MBA. Typically, it took an average 36 months for online students to complete their degrees, versus 19 for on-campus students. Yet, the net study cost of an online program was just $34,000, compared to $100,000 for a residential program. Online programs, even when they are in Europe, are far less international than residential options. The FT said that international students accounted for 19% of student enrollment online verus 50% in the on-campus programs in its rankings. In fact, at the 14 U.S. programs on the list, the combined international student enrollment is just 4%.
NORTH CAROLINA STATE RANKED FIRST FOR ‘ONLINE INTERACTION’
Not surprisingly, more online students—because they are currently employed and do not have to quit their jobs—receive some form of sponsorship from their employers. The FT said the average amount of sponsorship for online grads was $27,000, reported by half the sample. Only 9% of the on-campus grads had been sponsored, though the average amount of support was much higher at $79,000.
Another key metric in the FT analysis, one receiving a 10% weight, centers on online interaction, essentially how alumni rate their satisfaction with the enagement between classmates, teamwork and the availability of faculty. Graduates of North Carolina State’s Poole School were most satisfied on this measure, followed by IE Business School, the University of Florida, Babson College, and Syracuse University.
(See following page for full ranking results)