Friday, March 06, 2009

MBA rankings (that are actually right)

Whenever, I look through the business school and mba rankings produced by magazines, I'm struck that the rankings are stupid. It's as if they just randomly selected criteria, scored the schools along the criteria, and then said here are the rankings folks!

The problem with this approach is it is wrong. The two reasons it are wrong are 1) The criteria are arbitrary 2) The variance in the results (the fact that the rankings change ever year dramatically) is completely unexplained and probably wrong.

Since I've noticed a lot of the traffic to this blog is by people looking for information about MBA programs, I'm going to give you my opinion about business school rankings.

I think better approach rankings schools would be to ask the question - what schools do people want to attend? Using a statistical method called "conjoint analysis" you can look at what schools did people get in to, and based on that choice set, where did they choose to attend. If someone chooses Stanford over Wharton, you can rank Stanford over Wharton. If someone chooses Wharton over Tuck, you can rank Stanford and Wharton over Tuck. With a large enough data set, the preferences are fairly stable.

As my data set, I'm going to use my "vague memory" of what business schools my peers decided to attend based when I was at Mercer Management Consulting (now Oliver Wyman). I'm also not actually going to perform the analysis (that is beyond the limits of me and this actual faux data), but instead guesstimate the results based on observed behavior. I hope another institution (maybe someone like McKinsey that would have large data set) would perform this actual analysis some day. This is of course biased by the time at Stanford GSB and all my other biases since this guesstimate is essentially a qualitative assessment.

MBA rankings by Silicon MBA

1. Stanford
1. Harvard
3. Wharton
4. Kellogg
5. Tuck
5. MIT
5. Chicago
8. Columba
8. Berkeley
10. NYU

There you go. You'll notice they mostly fall in bands/tiers. Again, this result is heavily based on my own opinion, but my opinion is informed by observations of what business schools prospective applicants actually choose to attend.

1 comment:

J Liles said...

It's true, there are a ton of different rankings now, and of course it will depend on the target industry as well. I was bored one day, so I put together a spreadsheet of all the top rankings so that people could analyze them in one place: OneMinuteMBA Rankings Spreadsheet