B-School Rankings Offer Useful Data, But Not the Whole Story
We live in a data-rich era. Facebook can say more about someone’s personality based on their likes than many trained psychologists can. Target’s data-mining software famously predicted a teenager’s pregnancy by detecting a shift in her buying habits. And the company Palantir, one of Silicon Valley’s most talked about startups, has used data linkages to help catch Bernie Madoff and uncover Osama Bin Laden’s whereabouts.
But as someone who has built an academic career studying the science of how data is used — by companies, by governments and by individuals — I am also familiar with the limits of automated processes. In 2009 I co-authored a piece for Harvard Business Review examining where data-driven systems should end and “artistic” judgments begin. For example, we looked at Ritz-Carlton’s decision to abandon a 20-point customer service guide that hotel employees around the world had used for many years in favor of 12 value statements designed to allow more flexibility for how best to serve guests. Similarly, Massachusetts General Hospital has a rigid set of pre-operation procedures, but once surgeons enter the operating room they are encouraged to practice their complex art in whichever way will achieve the best patient outcomes.
I bring all of this up against the backdrop of business school rankings. Over the past 12 months, we’ve watched Owen move up and down on four major rankings: U.S. News & World Report, The Economist, Bloomberg Businessweek and The Financial Times. There are also additional rankings like those found in Poets & Quants and Princeton Review. Most of these rankings focus on MBA programs, but there are also new ones linked to specialized master’s degrees in business like the one in the Financial Engineer that placed our MSF program at #3 this year. We cheered when our MBA program jumped five places to #25 in U.S. News, two places to #22 among U.S. school in The Economist, and two places to #29 among U.S. schools in The Financial Times. But we also experienced some slips in other rankings. The up-and-down nature of rankings lends credence to many observers that have noted year-over-year volatility in rankings appears to be growing.
Next month, we’ll start the rankings cycle over again with the latest U.S. News rankings and the bi-annual Forbes ranking will come into the mix again this year. All told, Owen actively participates in about 12 rankings surveys each year.
For all that we sweat over these surveys, however, perhaps the least useful data points turn out to be the overall rankings themselves. Scratch beneath the surface a bit and you’ll find the really useful stuff: a wealth of data comparing everything from student and employer satisfaction rates to the quality of faculty research to the percentage of alumni giving. What this information does not offer is a paint-by-numbers system to determine what constitutes a great business school. As Bob Bruner, Dean of the University of Virginia’s Darden School of Business, put it in a blog post several years ago, “the rankings are simply data, not necessarily knowledge, wisdom, or absolute Truth.”
Rankings do matter. They matter to me, to our students, to our faculty, to our alumni, to Vanderbilt, and to my fellow business school deans. But I also recognize them for what they are: Data points that will invariably fluctuate over time. As dean, I’m much more interested in helping students develop the analytical and leadership traits that set them up to do great things on a global scale, rather than deploying a set of short-term tactics that might buy a few years of higher rankings.