If you're planning to earn an MBA (master's degree in business administration), then you're likely very analytical, resourceful, and thorough. So you probably are aware that there are many rankings scales for MBA schools and programs out there, from multiple sources. But you may be wondering how much credence to give any particular ranking. MBA rankings scales are helpful to get a birds-eye view of what's out there, or helpful if you know someone or something (like a company you're aspiring to join) regards those rankings highly. Otherwise, MBA program ratings can be a counterproductive distraction to students seeking the ideal university or college for their unique education needs.
How Business Programs are Ranked
A MBA degree is among the most popular graduate degrees, so school rankings became a popular method of recognizing quality when more and more institutions began offering MBA programs. A large number of publications adopted this trend, and every one decides which programs are the best differently. Because the process of rating MBA programs varies so widely, the end result of the rankings usually does too.
“There are basically two sets of rankings,” said Gerry Keim, Associate Dean of the W.P. Carey MBA at Arizona State University. “One set depends on reputation, surveying people in business. The Wall Street Journal and Business Week gauge their rankings on recruiters' perceptions, so schools that have been around the longest do very well because they have lots of graduates out there. We favor rankings that objectively measure how the business market responds to graduates, giving every school a chance to compete.”
Publications use very different criteria to establish their rankings. For example, U.S. News & World Report's rankings are based on peer assessments, but also on other factors such as student graduation rates, faculty-to-student ratio, school financial resources, average GMAT scores, applicant acceptance rates, and several other measures. Forbes rankings are solely evaluated by return on investment.
Other possible factors that can be used to evaluate MBA programs include: quality of instruction, faculty research productivity, admissions selectivity, opinions of students, and employment rates, graduates' starting salary average, yield (percentage of students accepting admission, and financial endowment (from successful graduates' donations), among others. Most rankings take several different factors into account, weighing each differently to determine a university or college's ultimate composite score. The data collection processes also vary, ranging from subjective surveying of the academic community (students, graduates, and professors) to gathering hard financial data. However, only incoming students can decide which of those many assessable factors are most important to them, and rank schools themselves based on the discoveries they make.
What Does a High Ranking Mean?
A school's MBA ranking matters mostly if the prospective student decides it does. Rankings are handy tools that give applicants an overall view of their choices and quantify important aspects of higher learning. But you should be very cautious when looking at such rankings and understand what each scale is based upon. Don't lean too heavily on any one list. All ratings processes have weaknesses—some overlook critical factors while others are distorted with statistical anomalies. Even the most ardent supporters of rankings scales have criticisms of the major ranking systems, and some would prefer if MBA seekers did not heed them at all.
“All rankings basically exist to sell magazines. Each has a different spin,” said David R. Lampe, Executive Director of Marketing and Communication at the Harvard Business School. “By declaring a number one, two, and three, they assume all schools are alike and all students are alike. They offer no useful information to help students.”
Dean Keim laid out a few specific difficulties inherent with MBA rankings.
“On subjective ratings, established schools have a tremendous advantage. There is a question of whether rankers can separate their business recruiting experience from love for their alma mater. You have to look at what's being measured, and it may very well be an old reputation.”
So one pitfall when considering rankings is that many lean heavily toward MBA programs of high prestige—Wharton, MIT, Stanford, etc.—ignoring great business courses at schools of less renown. But unranked or lower-ranked MBA programs might also have great qualifying factors, such as small average class sizes, high GMAT scores among students, successful graduates, and notable instructors, yet simply fly under the radar of national MBA rankings. And those national rankings are also less poignant to you if you want to stay in your region for education and work life after graduation. In that case, there would be fewer schools to choose from, but a few MBA programs in the area would likely be highly regarded in the state or region.
Even when an MBA ranking scale is driven by calculations, there are simple improvements that could make rankings scales more accurate and useful to students.
“All business schools teach students to use real measures, whenever possible, that make adjustments for variables like inflation and exchange rates. But on MBA rankings, average starting salaries are not adjusted for cost of living. Half of our graduates decide to stay in Arizona, where the average cost of living is much lower than many other cities where MBA graduates relocate, so they naturally have a lower starting salary. I've always found it funny that that basic principle is not applied to a business school ranking,” said Keim.
Students Must Evaluate MBA Programs for Themselves
At best, no institutional ranking scale can encompass and measure every factor that a student must weigh before choosing a business school. There are countless factors unique to every student that will contribute to a final MBA program decision.
“What really matters is a match between the student and what the school has to offer. For example, location is often critical, as is whether the school focuses on specializations or general management. Rankings disregard those important decisions,” said Lampe.
As a prospective student, you must also weigh the most important factors when seeking a master's degree in business administration.
“The primary attribute is job opportunities for graduates; this is the main reason most students pursue an MBA,” said Keim.
Keim said that after career outlook, other large factors come into consideration, such as the size of the institution, whether it is strong in a certain business specialization, and whether there is established networking to further the future goals of graduates.
“You've got to ask yourself: Do you feel more comfortable with 70 to 90 students in a classroom, or do you need more personalized attention from faculty? After graduation, will you be ready for international opportunities? Are you interested in a school with links to Wall Street?” he asked.
With all the looming questions an applicant must wade through, it's reassuring that there are other helpful tools and methods to determine the best graduate program for each unique student.
“We recommend the Graduate Management Admissions Council—who administers the GMAT test—they offer a personalized online tool (the MBA Pathfinder® Data Warehouse) with business school information and an approach that treats you as someone special and can actually help you find a match,” said Lampe.
You can also seek the valuable opinions of potential employers. Local or regional companies would likely have just as much respect, and more familiarity with, a nearby school's MBA program and graduates as those from a nationally-noted school. Either way, you can run a few school options by business leaders who hire MBA grads. You'll quickly gain a very relevant idea of how well-regarded each program is. And don't forget that business professors at the undergraduate level will probably have an opinion about most schools, maybe even feedback from former students who have attended the MBA program you're curious about.
The Internet is an extremely useful tool for those seeking the right MBA program. Anyone who digs in the right places can usually find a multitude of information.
“Web sites provide a lot of information, schools participate in the Graduate Management Admissions Council, and fairs will allow you to talk to reps of a school on a first-hand basis,” said Keim. “We try to bring a student to visit and preview the campus, attend sample classes, and have personal interviews. We want them to look around and feel like part of the program.”
Additionally, students should take a hands-on approach to find their perfect fit after narrowing the playing field. MBA programs typically go to great lengths to encourage student visits and program exploration, which is by far the best thing that a student can do to compare the programs you're interested in. A thorough school visit can give students not only information, but an understanding of the school's MBA program that cannot be obtained in any other way. Critical factors of a student's satisfaction with a program, like the overall environment (supportive vs. competitive), student/professor relationships, and plainly whether they feel like they'll fit in, can best be determined first-hand.
The most important aspect for you to make a successful MBA program decision is, borrowing the Latin platitude, to know thyself—you need to realize what drives you and what you hope to accomplish as an MBA-graduate and business professional.
“After a first pass, look in depth to find the right region, people, what to learn, and opportunities you want. You need to understand yourself as an applicant and know what is critical to you,” said Lampe.
Helpful Links for Making the Best MBA School Decision:
Rankings
Accreditation
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