The problem with business school rankings

This article is based on research findings by Josep M. Lozano, Ivan Bofarull & Queralt Prat-i-Pubill

For most people, a business qualification – particularly a post-graduate one – is a once-in-a-lifetime investment. There are few things in life that will require such a significant expense and commitment, so it’s essential for prospective students to ensure that the institution providing the education scores highly in rankings.

Or is it?

According to Esade’s Josep M. Lozano, Ivan Bofarull and Queralt Prat-i-Pubill, with co-author Sandra Waddock from Boston College in Massachusetts, business school rankings create an "iron cage" that forces all but the most established and successful schools into an unwinnable game. For striving business schools that want to join the ranks of the highly rated, the system makes it impossible for them to compete, regardless of the quality of their courses.

It's a particular problem for non-accredited institutions and smaller, more teaching-oriented schools.

Perversely, a focus on quality teaching could actually be more detrimental when it comes to rankings

Perversely, a focus on quality teaching could actually be more detrimental when it comes to rankings, which place more importance on Graduate Management Admission Test (GMAT) scores (used to assess people for suitability to MBA and other highly competitive post-graduate qualifications), and big-name placement and recruitment partners than the education process itself.

The result is similar to that of a corporation that focuses on bumping up its quarterly financial results for shareholders, rather than investing in long-term strategies to build competencies and ensure growth.

This is a catch-22 situation for the smaller, lesser-known schools that don’t have major research programmes. To grow and appeal to more students and recruiters, they need to score highly in the rankings. To score highly in the rankings, they need to be large, well-known schools with major research programmes.

But despite the seemingly unsolvable puzzle, it is possible for business schools to make a name for themselves without appearing in recognised ranking systems. And to do so, the study’s authors believe we need to create a new ecosystem of universities.

1. Change focus

There are alternatives to rankings that allow business schools to provide more meaningful information to prospective students and recruiters. As long as the majority of universities comply with the current ranking system, the same large and successful schools will continue to dominate.

The real – and complex – world in which we operate is much more nuanced. The narrow focus on fixed ranks implies a complete disregard for unique organisational, social and community purposes. There have been proposals for new, different, rankings, but the issue isn’t to choose one over another, but rather to create meaningful new understandings of a very complex landscape.

College guides, Assessment of Higher Education Learning outcomes (AHEL), classification systems and qualification frameworks can all help to provide a clear picture of what the school can offer its students.

2. Be specific

Businesses operate in many different sectors, each with its own unique set of influences. While theory may apply across the board, operations require strategies in line with the target market and sector-specific issues. It is this tailored, nuanced knowledge that’s frequently lacking in graduates fresh from exams.

This sector-specific approach may not help with ranking positions and in fact may even be detrimental. But a new type of quality, related to real-world outcomes, can help the business school to break out and deliver a programme that could be a valuable resource with an industry-wide reputation.

Innovations in curriculum, specialisations with a market-focus and learning to work closely with companies are all things that can be done by institutions that refuse to get too wrapped up in the ratings game.

3. Don’t follow the numbers – let the numbers follow you

An over-reliance on rankings has resulted in too many institutions striving to compete on an uneven playing field.

Rather than asking, “What kind of rankings do we want?” the question should be, “What kind of universities do we want?” And when we’ve answered that, the next question should be, “What do we want to know about those universities?”

An over-reliance on rankings has resulted in too many institutions striving to compete on an uneven playing field

The number of higher education students is forecast to quadruple from around 100 million in 2000 to 414 million in 2030. Business schools, and universities more generally, that are not already highly ranked may be wise to focus on the students who are entering this very different global arena with a completely new set of priorities and expectations.

Perhaps more importantly, business schools at all ranks need to consider how their views of management and leadership serve a troubled and highly competitive world, and offer an education experience that can help to solve our very modern problems.

By daring to be different, and by serving sector-specific markets, smaller and more teaching oriented institutions can be at the top of their own league.