We live in a world of rankings. People select restaurants, hotels, cars, computers and television screens on the basis of what others recommend. And when it comes to full-time MBA programs, would-be students have plenty of ranking options from which to choose.
For better or for worse, there are five highly influential MBA rankings: Bloomberg Businessweek, which just celebrated the 30th anniversary of its debut list in 1988; U.S. News & World Report, which began ranking MBAs a year later; The Financial Times, which published the first global MBA ranking; Forbes, whose ranking is centered on return-on-investment, and The Economist. Each ranking is based on a significantly different methodology, and the editorial decisions that go into what and how to measure business education has a major impact on the outcomes.
That is why some schools that rank highly on one list, may not do nearly as well on another. Truth is, there is no perfect way to rank anything, whether it’s an MBA program or a restaurant meal. But the reasons rankings captivate people is because no one has the opportunity to sample every MBA program you might apply to or to eat every restaurant meal that is reviewed. People tend to trust reliable sources, so the MBA rankings produced by five of the most respected media brands in the world carry great weight and influence.
THE POETS&QUANTS APPROACH TO MBA RANKINGS
Yet, each contains significant flaws and have substantive limitations. Nine years ago, we came up with a way for prospective MBA students to not only glimpse in one place all five of the rankings that matter and to compare and contrast them to add valuable perspective. Instead of merely reporting on the outcomes of each ranking and averaging the five, each ranking is separately weighted to account for our view of the soundness of the methodology and the credibility of the list. (U.S. News is given a weight of 35%, Forbes, 25%, while both The Financial Times and Businessweek is given a 15% weight, and The Economist, 10%.)
Those weights are determined by Poets&Quants Founder and Editor John A. Byrne, who created the first regularly published MBA rankings at Businessweek 30 years ago. He has closely followed these and other lists during that time and has an unusual understanding of the limitations of the different ranking approaches. A separate ranking is published annually by Poets&Quants for non-U.S. MBA programs, using the same rankings, with the exception of U.S. News, which does not rank international MBA programs.
Combining these five major rankings doesn’t eliminate the flaws in each system, but it does significantly diminish them. When an anomaly pops on one list due to either faulty survey technique or biased methodology, bringing all the data together tends to suppress it. So the composite index tones down the noise in each of these five surveys to get more directly at the real signal that is being sent.
‘THE RANKINGS ARE SIMPLY DATA, NOT KNOWLEDGE, WISDOM OR TRUTH’
How do we do it? Schools on each of the five major rankings are scored from a high of 100 to a low of 1, the numerical rank of the 100th school on any one list. So the number one rated school in a ranking is given 100 points, while the school rated 100th on a list is given a single point. If a school fails to be ranked, it does not get a score. Then, those sums are brought together with the above weights. The overall scores are then converted into an index with the highest score reflected in a 100 index score.
In the 2018 ranking of the best U.S. MBAs, Harvard Business School and the University of Pennsylvania’s Wharton School were tied for first place. Each program racked up 98.7 points under the scoring system, the most scored by any school, resulting in an index score of 100. The lowest absolute score for a Top 25 school was 74.55, leading to an index score of 75.5 for Indiana University’s Kelley School of Business. The median score for the Top 25 is 88.5, or an index score of 89.7, and assigned to Cornell University’s Johnson Graduate School of Business.
The Poets&Quants approach also tends to award MBA programs for consistency across the five rankings, and it penalizes schools who pick and choose where to get ranked to insure they get a better ranking result.
Ultimately, however, we agree wholeheartedly with former UVA Darden Dean Robert Bruner’s assessment of MBA rankings. “The best we can say is that the rankings are simply data, not necessarily knowledge, wisdom, or absolute truth,” he wrote. “One might look at several rankings to gain a sense of the field. But as an insider to that field I see vast differences among the schools that the rankings don’t capture and that account for considerable variation in the learning experiences of students. My message to applicants: there is no substitute for on-the-ground research; you must do your own homework.”
DON’T MISS: THE 2018 POETS&QUANTS U.S. MBA RANKING