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Making Sense of the Latest MBA Rankings

After announcing an unprecedented weeklong delay to respond to feedback and re-run the numbers, US News & World Report released its 2023-24 MBA rankings April 25. The results showed some surprises and major swings, somewhat scrambling the top 10 schools with others further down the list rising or falling by 30 places or more. 

Stanford Graduate School of Business dropped from third to sixth place and tied with Dartmouth’s Tuck, formerly # 11. Columbia Business School dropped out of the top 10 into a three-way tie for 11th place, just two months after scoring the #1 position in the Financial Times rankings. University of California-Berkeley Haas School of Business also slipped three notches and joined Columbia at 11 — although the Haas part-time MBA program is now ranked #1. 

What’s going on? How should a prospective student think about these moves? And how should an applicant make use of these rankings when choosing a school? Our Fortuna insiders have some thoughts to guide you. 


Turbulent Times for Rankings

First, some background. This latest US News results arrive in a year of backlash, as leading law and medical schools announced they were boycotting the rankings. Many of the criticisms raised also applied to the influential and widely followed MBA rankings from US News.

The issues raised aren’t new, and the numbers of ranking organizations are thinning out under the complexity of producing a valid assessment. “The Economist published what will be its last MBA ranking ever,” Poets&Quants’ John Byrne wrote in Dec. 2022. “Forbes has not released a new ranking for the past three years. Businessweek‘s annual list has come under withering academic criticism over its methodology.”

This year, boycotts and complaints led US News to revisit the methodology for all graduate school rankings, including MBA programs. While strong student profiles, placement outcomes, and reputation held the elite schools largely in place within the top tier, a third of the schools ranked below 40 saw double-digit swings in their placements. “The publishers faced uproar when they shared an advance copy of the results with business schools, so they decided to delay publication by one week,” says Fortuna co-founder and director Matt Symonds.

US News made some adjustments in response to the pushback and published the data. “But the uproar has not abated,” Symonds notes. Much of it stems from the changes to the ranking methodology. 

Methodology Madness

A full 50% of the ranking is now based on outcomes; job placement rates count for 30%, up from 21%, and starting salaries and sign-on bonuses are weighted at 20%, up from 14%. 

This gives great weight to a factor that students may care about most: their future career prospects. However, given swings in the economy and employment markets, this factor could have a huge impact from year to year, especially for middle-ranked schools. “Are you suffering because your school is sending people into tech careers and the tech sector is laying people off?” wonders Judith Silverman Hodara, a Fortuna co-founder and director.

To balance out the weightings, the quality assessment was reduced to 25% from 40% of the ranking. This reputational score is based on surveys of business school leaders and recruiters, and it adds some stability to the rankings over time. Recruiters are in an excellent position to judge the quality of a school’s graduates and come back year after year if they find great talent that adds value to their firms. “It is fairly safe to assume that deans do not radically change their opinions about the best business schools from one year to the next, so a pillar of stability has been shaken,” notes Symonds. 

Finally, US News cut the weight of GMAT and GRE scores slightly, to 13% from 16.25%, and boosted the weight of the average GPA to 10%, up from 7.5%. Many agree that three or four years of college performance is likely more indicative of the academic smarts and rigor in the MBA classroom than three or four hours of a standardized test. In a decision that dumbfounded many, US News opted to count GPAs reported on the 4.0 grading scale used in North America.

“In one stroke, they removed the grades of applicants from Sao Paulo and Stockholm to Mumbai and Melbourne. US business schools attract large numbers of international students to their MBA classrooms, but their strong grades that otherwise raise the program’s average GPA are no longer taken into account,” Symonds says. Top-tier schools that admit students with stellar grades didn’t feel this as much as mid-tier schools that attract international students with great grades that didn’t count.

Imperfect Measures

Rankings are a paradox: they are arguably useful as one measure of quality to prospective students. They undoubtedly are valuable to schools that market their standings to attract students, and they obviously bring value to the news organizations investing the effort to produce them. Yet they are inevitably flawed and as long as they have existed, even those who benefit complain about them. Schools push back on the rankings, leading to constant changes in methodologies, which in turn undercuts their comparative value over time.

Ostensibly, rankings attempt to provide some objective, quantitative basis for comparing schools, but it can be difficult to know exactly what is behind the published numbers and placements. For instance, this year perennially top-ranked Stanford GSB dropped to sixth place, tied with Dartmouth Tuck, formerly 11th. Starting salary accounts for 20%, and Stanford’s averages $198,032, just a hair below #5 Harvard and well ahead of Dartmouth at $191,712. (not to mention a full $12,300 more than #4 MIT’s average salary.) What else is pulling Tuck up, or Stanford down? 

Stanford GSB, it turns out, is a victim of its own success, Symonds says. It outperforms other schools on many of the measures that make up the ranking, but it “has a much lower 84% employment rate three months after graduation than its peers, reflecting the willingness of Stanford graduates to take the extra time to choose the right job offer, often in the most selective industries of private equity and venture capital, or high-growth startups.”  But it takes an insider’s knowledge, or a detailed inspection of the numbers and weightings, to understand that. 

A Grain of Salt

So, what should we expect of rankings? Wild swings in results might raise doubts about their validity. After all, business schools are large, complex, well-established institutions that aren’t going to change that dramatically in a year or two. But, Symonds asks, “Just because Harvard Business School is the most famous, should it always rank #1?” 

 “If US News rankings are relied on to simply replicate candidate perceptions about the place of HBS and Stanford relative to the rest of the M7, and repeat year after year the playlist of top schools from Ann Arbor and Hanover to London and Lausanne, we might as well save the results to the cloud and move on.”

That said, the stability of the top 10 does tell us something, according to Silverman Hodara. “The fact that Chicago Booth, which shared the top spot with Wharton in the last ranking, remained number one despite the swings is impressive. It’s really hard to stay on top of such a slippery slope with such strong competition.”

Rankings are hard to ignore, but they should be just one factor in your choice of schools. Considering their constant changes and shortcomings, that number should be taken with a grain of salt. Rankings boil down a broad range of factors into a single number, and leave out many intangibles, which may well be more important in your school choice. “With any ranking it is always important to look beyond the headline list to understand what is being measured,” Symonds notes. 

“The ranking means little if the school is not a good fit for you and your goals,” says Patty Keegan, a Fortuna director and former associate dean at Chicago Booth. You’re making a significant investment in your future and spending an intensive two years of your life in school, so the culture and environment matter. “The fit of the school should never be overlooked, despite all the ranking noise,” Keegan stresses.

Silverman Hodara agrees. While the rankings change their weights to prioritize some inputs, what you value as an individual matters more. “The salary you make when you leave might not be as important as who is in your LinkedIn network in the future,” she says. With so many schools tied for places in the top 20, it’s clear that there is sometimes only a sliver of difference between schools. “Does it matter whether it’s 1 or 6 or 10? What matters is if you feel at home. There are so many other things you should be taking into consideration on a personal level that have nothing to do with rankings.”

Symonds concurs: “Remember, being ’the best business school’ according to US News, the FT, Bloomberg or Forbes can be very different from ‘being the best business school for you.’”

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