Of the more than 700 MBA programs offered in the United States, fewer than 5% have been ranked in the top 25 by Business Week. Deans and administrators of the other 95% are probably convinced that their life would be much easier if only they could break into that group – applications would explode because Business Week would be greatly assisting their marketing efforts. While this is undoubtedly the case, life within the BW top group is not all wine and roses.

Every two years Business Week releases its rankings and dozens of deans and directors await them anxiously to see if they moved in or out, up or down. It’s amazing how dramatically a few schools improve in just 24 short months while others fall off cliffs – a cynic might argue that the rankings change more to sell magazines than to capture reality. What did Cornell really do to move from 18 to 8? And Darden must have lost half of its top teachers to drop from 5 to 11! Did they all move to Ithaca? I digress.

So if your school is lucky enough to make it into Business Week’s blessed group, how important is the actual rank? Sure, bragging rights are important but does the actual rank have any impact on applications? Surely the intelligent and informed 27 year olds who are considering an MBA at a top-ranked school are not going to be convinced by a magazine that there really is a significant difference between #8 and #11. Or are they?

Using the data on applications obtained directly from the Business Week web site, I regressed the percent change in the number of applications between 1998 and 1999 on the change in rank between 1996 and 1998. My hypothesis was that movement within the top 20 over the two-year period would have no impact on applications during the 1999 cycle. Wrong! The adjusted R-squared is an amazing 0.48 arguing that with 99% confidence the hypothesis is rejected – changes from one ranking to the next have a tremendous affect on applications – approximately 3% for each place. Cornell’s increase of 10 places would be predicted to lead to an increase of 30% and it was actually 35.2%. Darden’s decrease of 6 places predicts an 18% decline and it was actually 17.9%. Closer to my heart (and wallet) is Haas, which fell 3 places and experienced a decline of 10.5%. So much for believing that our potential students cannot be swayed by a weekly news rag.

So we now agree that, to increase applications we must continually move up in the Business Week rankings. What can we do to make this happen? Business Week surveys two groups – graduating MBA students and recruiters. We already do everything within reason (and sometimes beyond) to make our students happy. Plus they know that the one place where it is not in their self-interest to be critical is in the Business Week student survey. We give them plenty of opportunities to "tell us how it is" with internal surveys, focus groups, feedback sessions, open door policies, etc.

For recruiters, we pander even more – free lunches, valet parking, unlimited phone calls – only prospective football players are treated better. Anything legal to get them to include us in their top ten list of MBA programs. So what more can we do to move up in the rankings. The answer is – get bigger. The simple correlation of program size (defined as total number of full-time MBA students) with Business Week rank is 0.71. The larger your program the higher the rank. Those of us with small programs should strive to double in size so we can be ranked in the top five. But, of course, the current top five schools should follow the same advice to maintain their positions. Growth for the sake of growth – it’s the American Way.

Published in The MBA Newsletter, February 2000, Volume 8, No. 9, pages 5&10.

For another perspective on Business Week rankings, see http://welch.som.yale.edu/bweek.html.