We continue our series of articles dedicated to the most prominent business schools rankings that prospective candidates refer to when choosing which MBA programmes.
Our focus today is on the rankings published by Forbes and those published by the U.S. News & World Report.
The Forbes rankings of top business schools are based on the return on investment of graduates. They are published once every two years and their bottom line principle of ranking schools is to see how MBA degree holders that graduated five years ago are doing today. In essence, a survey is conducted among those who graduated with an MBA degree five years prior to the particular year’s rankings. The survey is meant to provide insight about how the graduates’ compensation, career choice and location have been affected by their degree.
For instance, the 2013 business schools rankings, which were Forbes’ eighth rankings to date, showed a comparison between alumni salary in 2008 vs. 2012, 5-year MBA gain and total payback period in years. The methodology Forbes uses for the rankings starts with surveying graduates from 100 business schools. An important detail of the Forbes rankings is that only two-year full-time MBA programmes are included. Then, based on the responses to the survey, a comparison is made between how much alumni earned during the five years following their diplomas [SW1] and their opportunity costs. The goal of the survey (which is used as input to the ranking) is to measure total compensation, including salary, bonuses and exercised stock options for the 5-year post-graduation period. Thus, Forbes ranks the schools by calculating how much graduates have earned since they got their diplomas versus the gains of their pre-MBA careers.
The first five positions in the 70-school 2013 rankings, which were published back in October 2013, are held by Stanford University, the University of Chicago (Booth), Harvard University, University of Pennsylvania (Wharton) and Northwestern University (Kellogg). Users of the rankings can see the values of the two-year full-time MBA programmes that made the list categorised by total 5-year MBA gain, years it took graduates to pay back the overall cost of their post-graduate studies (including their forgone opportunities while they were doing the programme), the graduates’ pre-MBA salary and their salary five years later, the tuition of the programme and the median GMAT score that was accepted[SW2] .
U.S. News & World Report publish the most popular rankings used by prospective MBA candidates, according to the AIGAC MBA Applicant Survey. The survey shows that 57% of the respondents use the business school rankings of U.S. News & World Report as their main[SW3] source when researching MBA programmes. This multi-platform and publisher of news and information releases several different rankings dedicated to the top online, part-time, executive and specialised financial MBA programmes. The most popular, however, are the U.S. News & World Report full-time MBA programme rankings.
453 full-time MBA programmes have accreditation by the Association to Advance Collegiate Schools of Business International and they all appear in the U.S. News & World Report directory. The rankings include the top 100 programmes and the other 353 programmes are listed for candidate information and reference as well.
The most recent rankings were published in March 2014 after a survey done by the U.S. News & World Report of all AACSB accredited full-time MBA programmes. Only 127 of the programmes provided sufficient data to be ranked. The calculations were made based on the weighted average of indicators in several categories.
The first category is quality assessment
It is weighted by 0.40 in the overall calculations. The quality assessment includes two indicators – peer assessment score (weighted by 0.25) and recruiter assessment score (0.15).
The second category is placement success
Weighted by 0.35 and includes mean starting salary and bonus (0.14) and employment rates for graduates of full-time master’s programme in business.
The third category is student selectivity
Weighted by 0.25. The category includes mean GMAT and GRE scores (0.1625), mean undergraduate GPA (0.075) and acceptance rate (0.0125).
More information and details about the formation of the rankings and how the results are calculated based on the different criteria can be found in the methodology section of the U.S. News & World Report.
The top 5 positions in the 2014 full-time MBA rankings are held by Harvard University, Stanford University, University of Pennsylvania (Wharton), the University of Chicago (Booth) and the Massachusetts Institute of Technology (Sloan).
The rankings display the per-year tuition rate [SW5] of the particular programme, the enrolment, the average GMAT score, the acceptance rate, the graduates’ employment at graduation, the average starting salary and bonus, the average undergraduate GPA, the graduates’ employment three months after graduation, the peer assessment score and the recruiter assessment score.
The last article of the series will be dedicated to a brief comparison between all the rankings we have discussed so far and an easy go-to guide about the criteria on which the rankings are based.
(Forbes and the U.S. News & World Report)