Why the U.S. News & World Report Best Business Schools Rankings Matter…and Why They Don’t
On Tuesday, U.S. News & World Report released its annual list of best business schools. While responses have primarily focused on how far some schools rose or fell on the list, others have reignited a familiar debate.
Over the years U.S. News has received its fair share of criticism for the type of data they collect and also how they go about collecting it, leading many to discount the rankings altogether. To its credit, from time to time U.S. News adjusts its methods to alleviate these concerns. For example, this year it reduced the value of test scores for business schools that don’t require GMAT or GRE scores. However, despite these adjustments, the question remains: Does U.S. News’ Best Business Schools list really matter? There are several perspectives to consider:
Why It Matters: The Data Includes Biased Perceptions
In addition to collecting hard data such as salaries and test scores, U.S. News also incorporates responses from “reputation surveys” sent annually to 20,000 academics and professionals. This would be less problematic if those filling out the surveys weren’t mired in limited information and their own biases, depending upon where they work or, in the case of business leaders, where they recruit. Additionally, it could be argued that elite institutions are naturally top-of-mind among respondents, so they will appear at the top of the list most of the time.
Why It Matters: It Contributes to Companies’ Diversity Issues
It’s also important to note that for the first time MBA programs that received less than a total of 10 recruiter and company contact ratings in the three most recent years of recruiter survey results received an “N/A” in place of a recruiter assessment score. While no score may appear to be better than a low score, it still sends a signal to companies that certain schools and their students aren’t worth investing their finite recruitment resources.
Research shows time and again that diversity and inclusion drives high-performing teams. Unfortunately, as long as companies continue to align their high-touch recruitment efforts with the same top ranked schools, the struggle to find more diverse candidates in all their myriad forms will continue.
Why It Matters: It Perpetuates the Pay Gap
U.S. News data shows that graduates at the top of the list receive salaries and bonuses that are three times higher than those received by grads from lower ranked schools. Since pay and placement are heavily weighted in these rankings (making up 35% of each schools’ score), this too becomes a self-perpetuating metric. As top companies continue to recruit from the same top schools year after year, they also continue to pay these graduates higher salaries.
Why It Doesn’t Matter: It Tells a Fraction of the Story
As mentioned before, the U.S. News rankings always receive some flak for capturing data in a way that doesn’t tell a complete story. For example, Yale School of Management lost its top ten ranking because the average SOM salary of $137,155 fell far below others like Ross and UT-Austin. This data fails to take into account that a large percentage of SOM graduates gravitate toward non-profit jobs that command a lower salary than more common MBA jobs like consulting and finance.
Why It Doesn’t Matter: It Reveals Nothing about Performance
In our view, the U.S. News list leaves out the most critical data point in its calculations— one that matters a great deal to both recruiters and students. It’s not enough for MBA students to graduate with a decent job and salary. In order to advance and make their employers happy, they must perform. However, like resumes and behavioral interviews, business school rankings aren’t strong predictors of individual job performance. Our own Case Challenges reveal this time and again. For example, top performers from the Salesforce Case Challenge came from schools of various ranks: Berkeley Haas (7), Northwestern Kellogg (6), Virginia Darden (13), Penn State Smeal (31), Wisconsin (37) and Georgia Institute of Technology (20) among others. Through this Challenge, Salesforce was able to add to their pipeline talented candidates from outside of the programs they typically recruit from — candidates they otherwise would have missed.
Our Advice to Students and Companies
After all this, students may still find these rankings encouraging or troubling. However, no matter where you earn your degree, performance drives career success. That’s why we’ve created a platform where performance is showcased and measured through Case Challenges developed by top companies. We know that the culmination of a candidate’s experience, skills, and accomplishments can never be fully quantified by a school ranking.
