Surprising Insights from the 2018 U.S. News Ranking of Top Business Schools: Stanford Drops to #4

US News College RankingsAdmit it: In today’s online world, we just can’t peel ourselves away from top-10 lists of anything! And the world of MBA admissions is certainly no exception. Schools and applicants alike are obsessed with rankings.

In our opinion, the U.S. News & World Report ranking of business schools is the “best” in terms of ranking schools by selectivity in admissions and their reputations in the marketplace. Quite honestly, most MBA candidates are looking for an environment where they’ll be surrounded by incredible peers and where they’ll get the best job upon graduation, so we believe it’s a very good ranking method.

You’ll hear some admissions “gurus” tell people to ignore rankings altogether, but at Veritas Prep, we see an important role for them. If you understand the methodology used behind the rankings, then they can be a helpful first step in your MBA research process. The problems lie when rankings become your first and only step in selecting target schools!

The biggest headline to come out of the 2018 U.S. News & World Report survey of business schools is that perennial powerhouse, Stanford Graduate School of Business, has dropped from #1 to #4 this year. Stanford remains the most selective business school in the world, with an admissions rate of just 6% and an average GMAT score of 733 last year (and the Class of 2018 has a record-breaking 737 GMAT score average!). The average salary and bonus for Stanford MBA graduates is a whopping $153,553 – essentially the same as Harvard’s and just $2K behind Wharton’s. So what happened?!?

Employment is Stanford’s downfall

Stanford’s drop in this year’s rankings was due to two statistics that carry significant weight in the U.S. News Ranking: percentage of students with jobs at graduation and percentage of students with jobs three months after graduation. By all objective measures, Stanford’s performance in this area is abysmal: just 63% of GSB students had jobs at graduation last year, and only 82% were employed three months out. Compare that to the Tuck School at Dartmouth, where 87% of graduates already had a job lined up when they received their diplomas, and 96% had jobs within three months! In fact, Stanford ranks #74 when it comes to jobs at graduation. But, there’s more to the story….

Stanford graduates aren’t just “looking for a job”

The #1 priority of students at most MBA programs is to have a job once they graduate. During my time at Kellogg, for example, job offers were always greeted with the greatest celebration and the lack of them caused the greatest stress among my colleagues. One’s entire 2nd year might be dedicated to the pursuit of a job offer. However, Stanford GSB students tend to be different than just about anybody else – they aren’t just looking for a job; they’re looking to change the world…TODAY. “Pursue your dreams” is a mantra drilled into Stanford MBAs from the moment they step onto its Spanish Colonial-inspired campus.

As a result, in our analysis, we’ve found that fewer Stanford students are looking for “traditional” post-MBA jobs than at any other top-tier institution. It has the highest percentage of students who pursue their own entrepreneurial ventures upon graduation, although these students who report that they are starting their own business do not impact the school’s reported employment statistics.

In addition, more Stanford grads are willing to be patient to find just the right position to enable them to make a big impact in their chosen profession, industry, society, or the world. Armed with a Stanford MBA, they recognize that they can get a job eventually, so they tend not to worry about whether that’s before graduation or several months after.

In short, the U.S. News statistics expose a growing trend at Stanford to be extremely picky when it comes to job offers. However, it doesn’t properly capture what U.S. News is trying to show through the data, which is the availability of job opportunities for graduates of each program. Stanford grads have at least as many job opportunities as graduates from any other global MBA program, so this drop in the rankings should not deter any candidate from applying.

ASU Carey jumps 10 spots after offering free tuition

In our opinion, the biggest news from this year’s U.S. News rankings comes from Arizona State’s W.P. Carey School of Business. Jumping 10 spots in one year, Carey has landed a spot in the top-25 for the first time ever. Outside of the top-25, it’s not entirely uncommon for a school to jump or slide 10 or more spots in one year, but this news comes on the heels of some major innovations at the Carey MBA program.

Most notably, the school announced in 2015 that it would make its full-time MBA program tuition-free for 100% of students. As you can imagine, the prospect of free tuition sent applicants in droves to the school, driving down its admission rate to just 14% – this makes Carey one of the most selective MBA programs in the country, ahead of Wharton, Kellogg, Tuck, and Booth.

The school’s admissions stats, such as average GMAT and GPA, improved dramatically, as did it’s yield—71% of admitted applicants chose to attend, far stronger than most top MBA programs. It’s employment statistics are equally impressive, with 79% of students landing a job before they don their graduation caps and robes, and 95% securing work within three months. Not bad!

Arizona State University grabbed the #1 spot in the U.S. News’ 2018 ranking of the nation’s most innovative colleges and universities (Stanford is #2 and MIT is #3). Before we learned of Carey’s parent institution’s honor in the ranking, Veritas Prep had also dubbed ASU’s business school as the most innovative, as not only did the school drop its tuition for the full-time MBA program, but it also merged with Thunderbird School of Global Management, long known as the top international business school in the world (though it had struggled in recent years).

Additionally, Carey’s online MBA program is one of the nation’s top online schools, and the university continues to expand its online offerings. While we wouldn’t be surprised if the offer of free tuition doesn’t last more than a couple of years, we believe ASU’s Carey School is the up-and-coming business school to watch.

What do you think of the 2018 MBA rankings? Let us know in the comments below!

Applying to business school? Call us at 1-800-925-7737 and speak with an MBA admissions expert today, or take our free MBA Admissions Profile Evaluation for personalized advice for your unique application situation! As always, be sure to find us on Facebook, YouTube, Google+ and Twitter.

Travis Morgan is the Director of Admissions Consulting for Veritas Prep and earned his MBA with distinction from the Kellogg School of Management at Northwestern University. He served in the Kellogg Student Admissions Office, Alumni Admissions Organization and Diversity & Inclusion Council, among several other posts. Travis joined Veritas Prep as an admissions consultant and GMAT instructor, and he was named Worldwide Instructor of the Year in 2011. 

7 Quick Takeaways From the New 2016 U.S. News & World Report College Rankings

USnews!Hot off the presses, the much-awaited U.S. News & World Report college rankings have arrived for 2016, and in stunning news…well, there’s not much stunning news. Princeton hasn’t gone the way of ITT Tech (New Jersey’s Ivy remains #1 for the sixth straight year), and the biggest “out of nowhere” story is that Villanova, now ranked 50th for national universities, took that perch having been reclassified from a “regional university” in years prior.

Still, there are always interesting trends and takeaways to be had from the slow-changing, well-respected rankings. Here are seven that caught our team’s eye:

1) The Central (Time)-ization of Higher Ed.
The typical Harvard/Princeton/Yale top 3 was cracked by a school outside the Eastern time zone…and no, it wasn’t Stanford. The University of Chicago moved up from 4th to tie for 3rd (with Yale), moving the nation’s “medal podium” slightly west this year. This continues a big surge for U. Chicago in recent years, having moved up from as far back as 9th in 2010.

Another big mover was Rice, jumping from 18th to 15th. The sum? A total of 6 schools – U. Chicago, Northwestern, Rice, Notre Dame, Washington University St. Louis, and Vanderbilt – in the Central Time Zone made the Top 15. (Alas, those Central-timers celebrating the notion of having 40% of the Top 15 should be careful: because of ties, a total of 18 schools can consider themselves in the Top 15, as well.)

2) USC beats UCLA
In the rankings’ most dynamic intra-city rivalry, USC finally moved a step ahead of UCLA, staying at 23 while the Bruins dropped ever-so-slightly to 24th. Last year the rivals were locked at 23, whereas the previous year saw UCLA a spot head of USC.

The other major intra-city rivalries stayed static, with Harvard safely above MIT, U. Chicago safely over Northwestern, and Columbia comfortably ahead of NYU.

3) It’s Good to Be A Bostonian…
Boston University and Northeastern each cracked the Top 40 this year (tied at 39), bringing the number of Boston schools with that distinction to 7. Harvard and MIT stayed in their usual Top 10 places, with Tufts (27th), Boston College (31st), and Brandeis (34th) also staying in that Top 40.

4) …or an Upstate New Yorker
While Columbia leads the way for all New York-based schools at #5, four other New York schools make the Top 40, with three of them coming from upstate. Cornell, naturally, leads that group at #15, and both the University of Rochester (32nd) and Rensselaer Polytechnic Institute (39th, in Troy), also earned that distinction.

5) The Public Option
With the exception of UC-Berkeley, each of the 22 schools with a Top 20 designation is a private school with a stated price tag of over $43,000. But once that list gets into the 20s, plenty of public schools with in-state tuition costs under $20,000 enter the mix: Berkeley, UCLA, Virginia, Michigan, and North Carolina all make the Top 30, with William & Mary, Georgia Tech, UC-Santa Barbara, and UC-Irvine ranking in the Top 40 at less than half the tuition cost of their private counterparts.

6) For Better Or Worse, Your Test Scores Will Matter
In the standard table view, the US News & World Report shows four statistics: tuition cost, undergraduate enrollment, SAT scores, and ACT scores (the range for the 25th percentile through the 75th percentile). And as you scan down the list, you’ll fisand that you have to get all the way to the 20th-ranked school (Emory) to find a middle 50% ACT range that isn’t entirely in the 30s (Emory’s is 29-33), and that only one of the top 15 schools (Dartmouth) has a middle 50% SAT range that includes scores below 1350.

As long as there are rankings that are based on quantitative data, standardized test scores will be a major way for schools to rise (or fall) in those rankings. It therefore follows that admissions officers will be looking for applicants whose stats can help them rise, so prospective students to highly-ranked schools should take their test preparation seriously.

7) Money Matters, Too
Seven of the Top 10 ranked schools are also in the U.S. News’ 2015 rankings for largest university endowments. When you see that Princeton has access to over $20 billion and Harvard holds over $36 billion, is it any wonder that these schools consistently top the U.S. university rankings? We’ll give a special shout out to Johns Hopkins, which managed its Top 10 ranking despite having “just” $3.4 billion in its coffers! Whether you think that’s puny or not, the fact is that all of these schools have the means to hire brilliant professors and give them access to world-class tools and facilities… Here’s hoping that they continue to invest in improving access to education and finding endless advances in all disciplines.

Do you need help with your college applications? Visit our College Admissions website and fill out our FREE Profile Evaluation for personalized feedback on your unique background! And as always, be sure to follow us on Facebook, YouTube, Google+, and Twitter!

By Scott Shrum and Brian Galvin.

Breaking Down the 2017 U.S. News Ranking of Top Business Schools: Part 2

US News College Rankings

Make sure you check out Part 1 of this article before you begin reading more of our thoughts on the recently released U.S. News and World Report‘s 2017 ranking of Best Business Schools. Now let’s take a deeper look at some of the surprises this year’s rankings presented:

 

Ranking surprises 
We were quite surprised to see Columbia (#10) come behind Tuck and Yale this year (ranked #8 and #9 respectively). Columbia has a very high yield of admitted applicants who choose to attend the school, and it has been working hard to foster a more collaborative culture. However, Tuck’s employment statistics and remarkably high percentage of graduates receiving a signing bonus (87%!) play well to the U.S. News methodology. We shouldn’t sell Tuck short, though, as other intangibles at Tuck not included in this ranking — such as student satisfaction, alumni network, and tight-knit culture — also rate among the highest of any MBA program.

Yale snagged Dean Ted Snyder from Chicago Booth back in 2011 after he presided over its precipitous rise in the rankings. His magic potion seems to be working at Yale as well, and we’ve dubbed him the “Rankings Whisperer.” He thoroughly understands the drivers of rankings and pushes all levers to the max to improve the standings of his schools. Yale has begun to move away from its ties to the social and nonprofit sectors, driving up average starting salaries and recruitment percentages, but perhaps distancing the program from its roots.

University of Virginia’s Darden School always seems to be the sleeper success story, and this year is no exception. With its best placement in more than a decade, Darden came in at #11. Darden’s reputation amongst peer schools and recruiters is not as strong as most other programs ranked in the top 15, but it has a very strong starting salary/bonus and other statistics.

Be wary of average salary numbers
The U.S. News ranking incorporates average salary plus signing bonus in its rankings, which in theory, is not a bad thing. After all, many applicants desire to gain an MBA, at least in part, to improve their salary potential. However, we recommend that you look at salaries just like the rankings themselves—by using the numbers in a broader context. After all, the difference in average salary and bonus between Harvard (ranked #1 overall) and Cornell (ranked #14 overall), is less than $5,000 per year.

If you analyze the data industry-by-industry (as we have), you’ll find that there’s little difference in salaries coming out of the top 10 to 15 programs. The biggest difference is the percentage of graduates who are able to land positions in highly selective industries, such as private equity. But here’s the rub: most of these highly selective industries are looking for extremely qualified candidates who have pre-MBA experience that fits their needs. So even if you manage to squeeze into Harvard or Stanford, if you don’t have the pre-MBA experience that these firms are looking for, then you’re going to have a tough time getting an interview, much less landing a job, in the highest paying private equity or venture capital positions.

Also, some roles, such as in investment banking, do not have as high of base salaries or signing bonuses, but a high percentage of your income will come from performance-based quarterly and annual bonuses. Other roles simply pay less, such as marketing and product management, but remain very attractive to a significant number of MBA graduates. Schools with a higher percentage of graduates taking these roles, such as Kellogg, can have lower overall salary averages, when their graduates make as much or more than peers within their chosen industry. None of this information can be captured in the U.S. News ranking.

Bottom line: Are you likely to make more money coming out of a program ranked #5 than ranked #20? Yes. But should you let this number dictate your decision between #7 and #12? Not necessarily. There are many other factors to consider, such as whether your target companies, industries, and so forth.

A holistic approach
We’ve provided a bit of context and analysis around this year’s ranking, and we encourage you to use these lists as merely a starting point in your research process. We encourage you to take advantage of our Veritas Prep Essential Guide to Top Business Schools to assist in your process, as it’s now available for free on our website!

In addition, if you’re interested in finding out your chances of admission to the top schools, you can sign up for a free profile evaluation to explore your individual strengths and weaknesses. Veritas Prep has worked with thousands of successful applicants to the top business schools, and we look forward to assisting you on your own journey!

Travis Morgan is the Director of Admissions Consulting for Veritas Prep and earned his MBA with distinction from the Kellogg School of Management at Northwestern University. He served in the Kellogg Student Admissions Office, Alumni Admissions Organization and Diversity & Inclusion Council, among several other posts. Travis joined Veritas Prep as an admissions consultant and GMAT instructor, and he was named Worldwide Instructor of the Year in 2011. 

Breaking Down the 2017 U.S. News Ranking of Top Business Schools: Let the Games Begin!

US News College RankingsJust three and a half months into 2016, U.S. News & World Report has already released its 2017 ranking of Top Business Schools, and there’s quite a bit to talk about. The U.S. News ranking is arguably the most influential among U.S. business schools, and for good reason.

Various stakeholders can (and do) haggle over percentages of weight given to this statistic or that, but we at Veritas Prep think it does a good job at quantifying broad characteristics that a typical business school applicant would care about, namely the school’s overall reputation (40% weight), the ability to place you in a good-paying job (35%), and the capabilities of your fellow students (25%). We won’t get into the nitty-gritty here, but you’re more than welcome to read about the rankings methodology on the U.S. News website.

Now, let’s get into the juicy stuff!

Chicago Booth moves to #2
For the first time in the poll’s history, Chicago Booth has entered the #2 spot, tied with Stanford Graduate School of Business. There’s a lot to talk about here. How can Booth, which admits one in every four applicants (24.4%), possibly rank equally to Stanford, which admits only 6.1%? The key is that Stanford graduates are pickier.

Let me explain: Stanford exceeds Booth (and pretty much every other program) in every category except job placement. In fact, on the surface, Stanford’s job placement numbers look absolutely abysmal: It ranks #52 in percentage of graduates employed at graduation (71.7%) and #74 in percentage of grads employed three months after graduation (86.2%).

But wait, shouldn’t recruiters be pounding down the door to hire Stanford grads? Indeed, they do. However, Stanford MBAs are known for being exceptionally picky, and they’re willing to wait to get the jobs they want. This year, 92% of Stanford MBAs had received a job offer within 3 months of graduation, but several of them chose not to accept those offers. MBAs from most other schools have a lower tolerance for risk, so once they near the three-month mark after graduation, few offers go unanswered.

In addition, far fewer Stanford graduates go into traditional MBA recruiting industries such as management, consulting and finance. These industries will hire whole classes of MBA recruits many months before graduation, so the schools that send more graduates into those industries tend to have stronger recruitment statistics than the programs that send more graduates into non-traditional positions. Remember, most companies will only hire someone when a position becomes available (just-in-time hiring), rather than hiring a whole slew of graduates at once.

Many Stanford grads tend to gravitate toward venture capital, private equity, or Bay Area startups, which are far smaller than the enormous banks and management consulting firms that many traditional MBAs are hired to. This depresses their statistics, but is also a key reason to attend Stanford GSB. Based on all other criteria, Stanford would be the clear #1 ranked program.

This isn’t to say that Chicago Booth isn’t deserving. The school has invested significantly in its career services resources and recruiting apparatus to ensure its graduates have stellar jobs upon graduation. Fully 95% of Booth graduates had accepted a job offer within three months of graduation, leading every school in the top-10 except the (much smaller) class at Tuck, which edged them out at 95.1%.

NYU Stern drops to #20, but ignore it
The biggest loser — by far — in this year’s ranking is NYU Stern, dropping from #11 last year to #20 this year. The school is furious, and we can’t blame them. Dean Peter Henry released a press release explaining the drop in ranking, which was due to inadvertently leaving one answer blank on a survey of 300 questions. The question asked for the number of admits that had submitted a GMAT score, which was not dramatically different from the previous year.

However, rather than simply reaching out and asking NYU Stern – perennially ranked in the top 10-12 programs – what the number should be, the ranking “estimated” the number, resulting in a drop of nine places. Clearly, their estimate was nowhere near realistic, and we at Veritas Prep believe this action by U.S. News to be in egregiously bad taste and downright punitive. We encourage all of our clients and readers to ignore this year’s ranking of NYU Stern, to not incorporate it into their school-selection decisions, and assume that had the data been reported correctly, the school would have remained in approximately the same rank.

Check out Part 2 of this article, in which we’ll take a deeper look at these rankings and what they might mean for you.

Applying to business school? Call us at 1-800-925-7737 and speak with an MBA admissions expert today, or take our free MBA Admissions Profile Evaluation for personalized advice for your unique application situation! As always, be sure to find us on Facebook, YouTube, Google+ and Twitter.

Travis Morgan is the Director of Admissions Consulting for Veritas Prep and earned his MBA with distinction from the Kellogg School of Management at Northwestern University. He served in the Kellogg Student Admissions Office, Alumni Admissions Organization and Diversity & Inclusion Council, among several other posts. Travis joined Veritas Prep as an admissions consultant and GMAT instructor, and he was named Worldwide Instructor of the Year in 2011.