UNJUSTIFIED VOLATILITY ANOTHER PROBLEM WITH THE FT RANKING
The volatility in the FT ranking — which diminishes the credibility of the list because there are few year-over-year changes at schools to justify big changes — again means that there were big winners and big losers. While there is nothing worse than dropping off the FT list entirely, the full-time MBA programs at several schools experienced dramatic drops in rank. This was especially true for all three Australian business schools that saw double-digit dropoffs.
Indeed, the single biggest drop recorded by any MBA program was felt by the Macquarie Graduate School of Management which plummeted 23 places to rank 97th from 74th a year earlier. Melbourne Business School and the Australian Graduate School of Management fell 19 and 18 places, respectively, to finish 80th and 88th (see table below on the double-digit decliners).
In fact, 27 of the 91 returning business schools had double-digit increases or declines this year. Nine MBA programs fell off the list, replaced by nine new business schools, mainly near the bottom of the list. More telling perhaps is the roller-coaster ride that schools have experienced in the ranking over the past five years. Half of all the MBA programs ranked five years ago by the FT. 39 of 78 schools, have experienced either double-digit rises of falls. And 23 of those double-digit changers have seen differences of 20 or more places.
THIS YEAR’S BIG RANKING WINNERS & LOSERS
Since 2015, for example, the University of Toronto’s Rotman School of Management has seen its rankings collapse by 41 places to 94th from 53rd. The Lisbon School’s MBA option has had even worse treatment, dropping 48 positions from 36th to 84th. On the plus side of the ledger, the Indian Institute of Management in Bangalore has soared 55 places to rank 27th this year from 82nd in 2015. It now ranks higher on the FT list than IIM-Ahmedabad, often regarded as the best IIM in India, which has fallen 35 places from a rank of 26th to 61st. The University of Notre Dame’s Mendoza College of Business is another winner over the past five years, having climbed 32 spots to rank 57th from 89th.
Among this year’s big decliners were the Singapore Management Institute, down 20 places to rank 63rd, and Durham Business School in the United Kingdom, which stumbled 19 places to rank 62nd. The steepest decline for a U.S. business school went to UC-Irvine’s Merage School of Business, which fell 17 spots to finish outside the Top 50 at a rank of 65th.
Several of the most successful schools on this year’s list will certainly make B-school observers wonder about the underlying credibility of the FT‘s ranking. George Washington University’s MBA program was the biggest gainer, moving up 20 places to rank 70th, while Southern Methodist University’s Cox School of Business improved its ranking by 18 spots to finish 74th. Another U.S. school, the University of Texas at Dallas, made the list of the biggest three gainers by climbing 15 places to rank 81st (see table on double-digit gainers on the following page).
STANFORD ALUMS POSTED THE HIGHEST AVERAGE SALARIES WITH WHARTON & HBS NEXT
To crank out its ranking, the FT gathers a lot of fascinating metrics. Among them are the current salaries of alumni three years removed from graduation as well as the increase over pre-MBA base salaries. Stanford came in first by posting the highest weighted alumni salaries of any business school — $225,589 to Wharton’s $217,141 and Harvard’s $208,023. For Stanford MBAs, that sum translates to a 117% increase over pre-MBA salaries. Compared to some of the lesser ranked programs, it’s a gain that is not nearly as impressive as the more than 200% jumps racked up by three Chinese schools: the Shanghai University of Finance & Economics (216%), Fudan University (203%) or Shanghai Jiao Tong University (201%).
But no schools score well across all of the FT’s many metrics. Some 77 MBA programs, for example, were ahead of Harvard on the newspaper’s “value for money rank” and HBS was just 18th on the “career service rank” even though its alumni boast the third-highest reported salaries. The top five schools for “value for money” are the University of Florida, Penn State, Durham University, Shanghai University of Finance & Economics, and Brigham Young University. The top five for career progress are Stanford, Renmin University in China, Babson College, Shanghai University of Finance & Economics, and IIM-Calcutta.
Yet when the Financial Times asked surveyed alumni which three schools would they recruit MBAs from, the number one school was Harvard, followed by Stanford, MIT Sloan, INSEAD and London Business School.