A New Rubric for Ranking MBA Programs

By: Steve Rubis

As a budding stock analyst, I place serious emphasis on attaining an MBA. Many programs exist that are of high quality, but the problem is that the rankings are quite disparate. A student will find that school X is ranked 10th according to one source, but then only 20th according to someone else. It seems obvious that the rankings are flawed and do not allow students to make informed decisions. Certainly, US News and World Report, Businessweek, and The Financial Times offer solid rankings for both domestic and international programs; however, they do not have a common rubric. Prospective students lack a uniform ranking system that can help ease the decision making process. The following article intends to propose a new system, which will provide greater value to the prospective student.

The rankings dilemma is not only a major issue for students but also MBA programs themselves. The AACSB recently formed a committee to analyze the ranking systems and the effects of these systems on MBA programs. You can read their report here: http://www.aacsb.edu/publications/Rankings/Ranking%20Report_fnl.pdf

The major finding of this task force is that schools are ranked rather than rated - an important distinction. Media companies are merely in the business of placing a numerical order on business schools using arbitrary statistics and arbitrary weights. It is apparent that these ranking systems have created an unhealthy reliance on GMAT scores and other statistical data. The true quality of a program is not illuminated by the current methodology and creating a frictional admissions problem. Students and programs are not matched appropriately; rather, students seemingly apply for the top ranked schools, while the schools only select top ranked students. Unfortunately, these rankings are the only sources available for students, until now.

The AACSB is correct in arguing that schools should be rated rather than ranked, or that ranking criteria must become uniform. There are two solutions to this problem: (1) analyze a business degree like a stock; (2) rate or rank schools based on what the program offers. From a ranking stand point, it seems that there are five key criteria. Salary upon graduation seems to be most important, since this determines your return on invested capital. Secondly, does the program offer the specialized training needed to enter your chosen field. These two items seem to be most important; why go to a school for investment management if their specialty is the public sector? The third and fourth items revolve around reputation and price. The final aspect to be considered is price of the program.

Our goal is to provide readers a comprehensive list of business schools, which specialize in Investment Management. The article will provide a synopsis of the program and then be ranked according to our criteria mentioned above. It should be interesting to see who comes out on top!