(Poets&Quants) — Dimming employment prospects on Wall Street may be causing some jitters on campus, but the mood at Harvard Business School is decidedly upbeat. Many students came back from their summer internships with lucrative job offers in hand, and for the first time in the school’s history, the entire first year class of some 900-plus MBA students is about to embark next month on an eight-day global immersion experience.
“We are feeling the pressure of final exams and projects,” says Jehan deFonseka, a second-year student who is also editor of The Harbus, the B-school’s student newspaper. “One of my professors, Joe Lassiter, gave us the advice, ‘Die exhausted, not bored.’ So far, this year has lived up to that belief.”
And now the school is about to get a pre-holiday present of sorts. For the second consecutive year, Harvard bested all other business schools for the distinction of best MBA program in the U.S., according to a new ranking by PoetsandQuants.
This new P&Q list is a composite of the five major MBA rankings published by Bloomberg BusinessWeek, The Economist, The Financial Times, Forbes, and U.S. News & World Report. The ranking takes into account a massive wealth of quantitative and qualitative data captured in the five major lists, from surveys of corporate recruiters, MBA graduates, deans and faculty publication records to median GPA and GMAT scores of entering students as well as the salary and employment statistics of the latest graduating class.
By blending these rankings using a system that takes into account each of their strengths as well as their flaws, we’ve come up with what is arguably the most authoritative ranking of MBA programs published. The list, which includes the recently released 2011 rankings by The Economist, tends to eliminate anomalies and other statistical distortions that often occur in a single ranking. In any case, the ranking measures the overall quality and reputation of the flagship full-time MBA programs at the schools, rather than the schools themselves.
Right behind Harvard is a familiar group of world-renowned schools whose graduates have long represented the best and brightest in business. Stanford Graduate School of Business is second, the University of Chicago’s Booth School of Business is third, the University of Pennsylvania’s Wharton School is fourth, and New York’s Columbia Business School rounds out the top five.
Among the top 10, eight schools retained their rankings from last year. The two exceptions: MIT Sloan moved up to a fifth place tie with Columbia Business School, up from eighth place last year, largely due to a significantly improved ranking from Forbes. Dartmouth College’s Tuck School, despite receiving a No. 1 rank from The Economist this year, slipped two places to No. 8 from sixth place this previous year, primarily because the school fell several places in the rival Forbes ranking.
Compared to most other rankings, the P&Q analysis leads to a far more stable list. Only 11 of the 100 ranked U.S. schools experienced double-digit changes. In some other rankings as many as one out of three or four schools randomly dive or rise by 10 or more places in a 12-month period, even though there have been no significant changes in the quality of the schools. In the P&Q ranking, not a single MBA program ranked in the top 25 had a double-digit increase or decline. In fact, 16 of the 25 schools had no changes in rank at all and another three schools moved just one place up or down.
Who’s up, who’s down?
Among the top-tier 25 schools, the most notable improvements occurred at the University of Wisconsin at Madison, which moved up six places to a rank of 24 from No. 30 a year ago, and at Vanderbilt University’s Owen School, which inched up three spots to 25 from 28 a year earlier. New York University’s Stern School, meantime, slipped three positions to a rank of 15 this year from 18 in 2010.
Bigger changes were most likely to occur further down the list, where the qualitative differences among the business schools aren’t nearly as great as they are at the top of the ranking. So small changes often can cause outsize results because the schools are so close together in overall quality — especially “quality” as it can be discerned by an external ranking. In these cases, the most significant changes tended to occur at schools that were either added or dropped from one of the major rankings in the past year.
Washington University’s Olin School, for example, plummeted 15 places to No. 41 from 26 because it fell off the top 100 list compiled by The Financial Times and lost ground in two other rankings by Forbes and U.S. News & World Report. Similarly, Ohio State’s Fisher School of Business climbed 14 spots by improving in the Forbes ranking and getting onto both The Economist and The Financial Times’ rankings. The school had been excluded from those lists a year earlier.
Strong getting even stronger
By and large, these top schools have fared well through the economic downturn and the continued global uncertainty. Though applications have been declining at many leading schools, the starting pay packages for this year’s graduating classes were up, along with job offers. At Dartmouth’s Tuck School, Havard, and Columbia, 97% of the students had job offers within three months of graduation. And at most schools, the incoming crop of this year’s newest students was among the best ever as judged by their GMAT scores and work experience. At Harvard, the median starting salary of a class of 2011 graduate hit $120,000, up from $110,000 a year earlier. And one Stanford MBA landed a hedge fund job in the Northeast that paid the freshly minted graduate a guaranteed bonus of half a million dollars.
Harvard’s road to reform
The Harvard honor comes at an opportune time. HBS Dean Nitin Nohira is in the midst of a highly ambitious effort to update the Harvard MBA experience. The curriculum changes are lessening the school’s dependence on its previously sacrosanct case method of teaching that has been the dominant pedagogy at HBS since the mid-1920s. The most significant of these alterations has been the introduction of a new first-year course called FIELD (Field Immersion Experiences for Leadership Development). Based on small-group learning experiences that focus on leadership, global business and entrepreneurship, the course puts the focus on learning by doing.
Most daunting for the institution and the faculty is that Harvard has had to line up some 150 organizations willing to give meaningful project work during the January term to 900-plus MBA students in countries as varied as Vietnam, India and China for an eight-day global immersion experience. The whole idea has some rival deans wondering about the outcome.
“What’s unique is that it’s required,” says Robert Bruner, dean of the University of Virginia’s Darden School. “Every student will have to do it. It’s a big deal. I admire and applaud Harvard. The question is, will this exercise speak to the students? We’ll find out. I’m rooting for them, and I admire their audacity.”
So far, there has been some student grumbling over their forthcoming project assignments. But overall, the new curriculum changes have been received positively, say students. If The Harbus’ deFonseka were handing out HBS grades, which are done by number instead of letters, he would give Dean Nohira a low 1, equal to an A-.
“He has been a very visible dean, and has been open in communicating his plans with students,” deFonseka says. “He and his team have been pretty responsive when students have had problems with the new curriculum — for example, their FIELD location assignments. There is work left to improve the new curriculum, as one would expect, but the direction that HBS is going is definitely the right one.”