It was 30 years ago when Businessweek magazine published its first ranking of full-time MBA programs. It was the first of the five most influential MBA rankings, quickly followed by U.S. News and well before The Financial Times, Forbes, and The Economist got into the act.
The anniversary ranking from what is now Bloomberg Businessweek will go public on Thursday, Nov. 8th. That’s when the magazine will unveil its updated list on 93 U.S. programs, with a global ranking of 124 business schools to follow on Dec. 11th of this year.
The newest ranking will unleash a wealth of new data for students and administrators to absorb and assess. It will be based on survey responses from 10,473 students, an 11% increase over last year; 15,050 alumni, up more than 50%, and 3,698 corporate recruiters, a fivefold increase from 2017. That big jump is a vast improvement on the puny 5.8% response rate for recruiters last year, resulting in just 686 responses.
30 YEARS AGO ONLY 20 U.S. SCHOOLS WERE IN THE DEBUT MBA RANKING
Thirty years has made a lot of difference. In the first ranking, roughly 3,000 MBA graduates from just 23 U.S. business schools were surveyed and 1,245 responded for a response rate of about 42%. Only 265 companies which recruited at a third or more of the schools were surveyed. Some 112 responded, a response rate of 42%.
The recent MBA graduates who completed the debut survey, however, did not know it was being used to rank their schools so there was little to no cheerleading in their responses. For the corporate survey, only the manager of the company’s MBA recruiting function was asked for his or her perspective. The result: Only companies that literally make the MBA market were included and each had just one voice.
Now Businessweek surveys every recruiter who visits a campus and many of them are alumni of the schools from which they recruit. The vast majority of them have little to no basis to compare and contrast hires from a wide variety of schools. Their responses are so biased in favor of their alma maters that Businessweek concedes that on average they score their own schools 15% higher than other schools. In the newest methdology, the magazine is making “djustments for this bias based on the number of alumni recruiters and the degree of bias seen.”
TOP FIVE IN 1988: KELLOGG, HARVARD, TUCK, WHARTON & JOHNSON
The far more limited debut ranking placed numerical ranks on the full-time MBA programs at 20 U.S. business schools. Northwestern University’s Kellogg School of Management led the list, followed by Harvard Business School, Dartmouth College’s Tuck School of Business, the University of Pennsylvania’s Wharton School, and Cornell University’s Johnson Graduate School of Business.
In last year’s Businessweek ranking, only two of the five orginal schools were in the top five: Harvard in first and Wharton just behind it. MIT Sloan took third place, the University of Chicago’s Booth School of Business was in fourth, and Stanford’s Graduate School of Business was fifth. Kellogg had slipped to eighth place, Tuck to seventh, and Johnson to 13th.
In recent years, Businessweek has gone back to the drawing board to alter its methodology on several occasions, causing widespread angst and frustration among deans and administrators. Those methodology tweaks have led to dramatic changes in the year-over-year ranking of schools, having little to do with the actual quality of an MBA program or the impact of MBA education on either students or corporate recruiters.
EXPECT YET ANOTHER RESHUFFLING OF BUSINESS SCHOOLS ON THE NEW LIST
With the 2018 ranking that comes out in two days, there are several big changes that will undoubtedly lead to yet another reshuffling of the business school list. For the first time ever, Bloomberg Businessweek will produce a global MBA ranking, comparng U.S. and international business schools on the same list. Up until now, Businessweek has published separate rankings for U.S. and international MBA programs.
In a Nov. 1 email—obtained by Poets&Quants—Businessweek revealed that it has created four “indexes” that group the answers to its surveys under broad categories: Compensation, Learning, Networking, and Entrepreneurship. “Each school is ranked in order for each index, as well as in our overall rankings,” explained Bloomberg Senior Editor Caleb Solomon in the email.
Over the summer months, Businessweek had told schools it would have “indexes” on Transformation and Diversity, but the editors decided to eliminate those two categories and add Entrepreneurship. “We took out the Transformation Index because after repeated visits with schools and others, it became clear that transformation meant many different things to different people,” adds Solomon.
CHANGES ARE THE RESULT OF A LENGTHY LISTENING TOUR
“We cut the Diversity Index because we weren’t satisfied that the data we collected on the on-campus climate for underrepresented groups were comprehensive enough to support a separate index and component of our overall rankings. Meanwhile, survey respondents told us that Entrepreneurship was among the most important elements of a business school education, so we added it as an index.”
The changes are the result of a lengthy listening tour by Businessweek editors. Solomon says editors visited 15 business schools, interviewed representatives from schools around the world, and met with many at its New York headquarters.”In total,” he adds, “we spoke with 43 schools. Based on our conversations, we created an interactive ranking to help potential students make what ultimately is a highly personal decision.”
Weighings, a critical component of every ranking, were determined not by the editors, according to Solomon, but by survey respondents. “Rather than assign weightings ourselves, as most rankings do, we took an approach recommended by several of the business schools we spoke with: Let the stakeholders decide,” explains Solomon. “To do this, we surveyed students, alumni, and recruiters to learn what was most important to them. Their answers determined the weightings of each of our new indexes. Then, based on our survey results and compensation data, we calculated overall rankings.”
WEIGHING COMPENSATION, NETWORKING, LEARNING & ENTREPRENEURSHIP
Businessweek is putting 38.5% weight on compensation, 27.9% on networking, 23.1% on learning, and 10.5% on entrepreneurship. Solomon explains that in networking, Businessweek is attempting to measure “the quality of networks being built by classmates; students’ interactions with alumni; the successes of the career-services office; the quality and breadth of alumni-to-alumni interactions; and the school’s halo, or brand power, from a recruiter’s vantage.”
Much of these and other things have been measured in the Businessweek ranking from the very beginning. This year, it’s just more complicated and more confusing than ever. The networking index, for example, includes metrics that would fit more neatly into pay and placement, including assessments of a school’s career services office and recruiter opinion of a school’s “brand power.” What those two assessments have to do with networking is anyone’s guess.
In the learning index, the magazine is trying to measure the quality, depth, and range of instruction. “We focus on whether the curriculum is applicable to real-world business situations; the degree of emphasis on innovation, problem-solving, and strategic thinking; the level of inspiration and support from instructors; class size; and collaboration.”