US News & World Report B-School Rankings for 2007

The following is from the All Star Essays blog for March 31:

US News & World Report has released its 2007 rankings of top business and graduate schools. As often happens, there was little change in the upper ranks of the top 50 b-schools. In the 'lower half' of the top 50, however, there were some interesting developments.

The top 20 or so slots of the USNWR rankings went to the usual honor roll: Harvard, Stanford, Wharton, Sloan, Kellogg, Chicago, Columbia, Haas, Tuck, and so on. These are the same schools that make the top part of anyone's list, year in and year out, and for good reason. They offer outstanding management education from exceptional faculty and introduce their students and graduates to vibrant networks of business leaders.

One of the reasons this 'short list' of top b-schools tends not to change much from year to year or from survey to survey is that it takes a considerable amount of time, money, and effort to organize the components that make a top school. It's hard to break in to the top ranks; it's hard to fall out of them, too.

That's less true of the somewhat lower ranks. That's where the most notable changes can be seen between last year's USNWR rankings and this year's.

Three schools that made USNWR's list of the top 50 b-schools last year did not make that same cut this year. They are the University of Iowa (Tippie), The University of Arizona (Eller), and Wake Forest University (Babcock).

In addition, several schools received significantly lower rankings this year than last year. The University of Washington went from 18 last year to 29 this year. Georgetown (McDonough) went from 27 to 34, and the University of Maryland (Smith) went from 27 to 38.

On the plus side, there were schools that rose significantly in this year's rankings. Michigan State (Broad) went from 32 last year to 23 this year. Washington University in St. Louis (Olin) went from 32 to 26. The University of Wisconsin-Madison went from 37 to 31, and Brigham Young University (Marriott) went from 40 to 34.

Three schools that were not ranked in the top 50 b-schools last year won places this year. They are Southern Methodist University (Cox), Boston College (Carroll), and the University of Pittsburg (Katz).

So what exactly does all this mean?

Overall, we're skeptical of every one of the half-dozen rankings systems in general use for business schools. We encourage our clients to be skeptical of them, too. USNWR's methodology is better than some, but even its findings depend on some highly objective input (peer assessment) and some factors that are subject to chance or to manipulation (how many alumni round up their starting salaries by how much).

As with many surveys and polls, changes in numbers over time tell us more than absolute figures do. The fact that Harvard is ranked number 1 and Stanford number 2 doesn't say much about how one school's program compares with the other. But the fact that the Olin School rose by 6 places from last year suggests that the school is at a minimum making a concerted effort to improve its image and attract more students. That's not a bad thing, from a prospective applicant's point of view.

The bottom line on rankings is that they can be a useful starting point for school selection but are a poor basis to make decisions about which schools to apply to.

To use the Harvard-Stanford example again, the USNWR rankings are accurate in tagging both of those schools as having some of the best MBA programs in the country. The rankings don't, however, explain how the schools are different from one another, or give information about why one school might be a better fit for you than the other. You'll have to dig deeper for that information. It's worth the effort to find it, too, because an articulate case for why you are particularly well suited to be a student at school X (laid out, of course, in your essays) is one of the biggest advantages you can bring to the competition for b-school admissions.

MBA Hiring Up by 18% in 2006, GMAC Survey Finds

The Graduate Management Admission Council's 2006 Corporate Recruiters Survey is out -- and it's full of good news for MBA students and prospects.

The survey found that:

• Companies plan to increase MBA hiring by 18% in 2006
• MBAs with finance and marketing skills are especially sought-after, as are those with 'soft' skills (communication, team building, leadership, etc.)
• Companies plan recruiting trips to an average of 10 b-schools this year, compared to 9 last year
• 2006 MBA grads can expect an average base starting salary of $80,809 and a total compensation package averaging $99,737. By comparison, the average base salary for 2005 was $78,040, and the 2004 figure was $77,066.

The GMAC has conducted an annual survey of recruiters for companies that hire MBAs since 2002. This year's survey polled 1,270 recruiters from 737 companies.

GMAT Turns to Computer Scoring for AWA

"Computers Grade Essays of Business School Prospects"
By John Woodward
The Business Journal of Jacksonville - March 24, 2006

The essay-scoring software industry is expanding due to advances in technology, following the introduction of writing on standardized tests, such as the Graduate Management Admissions Test.

Officials at Vantage Learning of Newtown, Pa., said the Graduate Management Admission Council chose the company to provide computer-based essay scoring for the Analytical Writing Assessment portion of the GMAT, used by business colleges to judge prospective graduate students. ...

Amid some concern, officials from the council said the GMAT is not changing, despite the use of automated scoring. They stress that each person's score using the automated system will be comparable to every other person's score before the system was used.

Vantage also provides computer-based essay scoring and feedback for the College Board's online Scholastic Assessment Test practice essays....

The idea of computers grading essay questions may present ethical dilemmas for some, but the technology has been proven, said Harry Barfoot, vice president of marketing for Vantage.

The technology uses a method that allows the program's scoring ability to evolve, or become more specific to individual needs, such as the needs of the GMAT exam, company officials said.

The program operates around different rubrics and models that have been taken from expert scorers. After a prompt is created, a sample number of essays are graded by human scorers.

Their scoring methods and what they look for are input into the program. The program then applies those methods and tags to other essays. According to that principle, the scoring method becomes more refined and more accurate as more human-scored essays are fed into the system, company officials said.

USC Marshall Students Fall Victim to Investment Fraud

USC Adjunct Charged with Drawing Students into Investment Fraud

It looks like some USC Marshall students have gotten a stinging lesson about the risks of real estate investments – and that they got it the hard way.

Barry Landreth, a 2001 grad of Marshall's master's program in real estate development and a part-time instructor at Marshall, was arrested by the FBI on March 24 and charged with investment fraud. The scam, described as a Ponzi scheme, reportedly netted him over $1.5 million. The victims include some of Landreth's students and their family members.

Landreth told his victims that he would use their money to purchase land in Chicago and Las Vegas that would be resold at a large profit within 4 to 6 weeks. In reality, he deposited investors' money to his personal account, using a good part of it to buy and care for show jumping horses.

Landreth used his classes to recruit unwitting students as sales people. He promised students a salary in addition to the profits on their own investments. According to Inside Higher Education, court documents state that some students invested as much as $100,000 of their own and their families' money.

Students grew suspicious when they received neither the promised salaries nor the investment returns. They complained to authorities, who began investigating Landreth last fall.

USC and the Marshall School have no comment on the story at this point except to say that Landreth had been teaching this semester and was put on administrative leave following news of his arrest.

Yale SOM Cuts Enrollment to Focus on Core Curriculum Revisions

"SOM Overhauls Academics"
By Kate Aitken, Staff Reporter
The Yale Daily News - March 23, 2006

The Yale School of Management will implement a new interdisciplinary core curriculum next year as the first step toward a new style of management education that the school hopes to pioneer, following a unanimous faculty vote on Wednesday.

The new core curriculum -- which will be implemented this fall for the incoming SOM Class of 2008 -- is based on an interdisciplinary model that eliminates classes teaching discrete subjects. Instead of traditional classes such as finance and accounting, next year's students will take classes taught in three different modules, each incorporating aspects of traditional management courses relevant to a specific practical area of management.

"There's a lot of anxiety over the state of management education because of a fundamental disconnect between what management education today teaches and what leaders of organizations are looking for, and that is people who are able to independently identify problems, frame those problems in a larger context and draw together the resources necessary to solve them," SOM Dean Joel Podolny said....

Student Body Representative Josh Fried SOM '07 said that despite the initial shock of the changes, many current students prefer the new curriculum to the form of management education SOM currently provides.

"As I was leaving I hung around for a couple seconds to catch the buzz and heard a couple first-years say they wished they could start over again next year," Fried said. "I think we all feel a little sad that we're not in the Class of '08."

Also see:

"Rethinking the MBA Curriculum"
By David Epstein
Inside Higher Education - March 24, 2006

The world economy has changed quite a bit since the 1950s, but many MBA programs still have traditional core curriculums, with wholly separate courses in accounting, finance, and economics. Yale University’s business school has decided to take a new approach that will replace such courses in the first year of a program with interdisciplinary offerings that reflect the fluid nature of business.

Senior faculty members in the School of Management voted unanimously Wednesday to begin redesigning the curriculum. Dean Joel Podolny, who is in his first year, and a committee of senior faculty members regularly solicited information from alumni, recruiters, business leaders, students, and what they learned is that students aren’t necessarily ready for the interdisciplinary nature of the workplace.

“We can see connections between what we do and all kinds of applications, because we’re steeped in it,” said Sharon M. Oster, a professor of management and entrepreneurship. “We thought our students would, but it seems not to be true. We need to work harder to help them make those connections earlier in their careers, not just seven years down the road.”

Officials from the School of Management were careful to point out that all the faculty voted on concretely was to make change, not any specific changes. But senior faculty members said there is already an outline to start things off with what would significantly change the first year — and which will start right away....

Arthur J. Swersey, a professor of operations research, said he thinks that the business school’s relatively small size makes a complete overhaul realistic. “We have groups of people, we don’t have departments,” he said.

And the school will get smaller still. In order to free up faculty members for course development, next year’s class — the first under the new system — will be down from 220 students to 180....

USC Marshall Students Put Skills to Work for Small Businesses

"USC Students to Advise Small Businesses in L.A."
By Walter Hamilton, Times Staff Writer
The Los Angeles Times, March 14, 2006

USC's Marshall School of Business is expected to announce today the launch of a program in which students will give free financial and managerial advice to small businesses and nonprofit groups located near its Los Angeles campus.

The effort, which is being done in partnership with the William J. Clinton Foundation and the Orfalea Family Foundation, is modeled on a program begun by former President Clinton in the Harlem area of New York in which New York University students provide counseling services to neighborhood businesses.

As in New York, the USC students will offer advice on such topics as financial analysis, accounting, marketing and business development.

The undergraduate and graduate students will receive course credit.
The program will begin in the fall with Stephen Byars, a business school professor, as executive director....

Also see:

"USC Marshall, Others to Boost Small Firms"
Press release, USC Marshall School of Business - March 15, 2006

An alliance of the William J. Clinton Foundation, the Orfalea Family Foundation and the USC Marshall School of Business that is designed to offer technical and managerial assistance to small business owners and nonprofit organizations in Los Angeles has been announced.

The alliance – called USC ImpactLA: The Clinton Foundation-Orfalea Urban Enterprise Initiative – is funded by a $2 million contribution from the Santa Barbara-based Orfalea Family Foundation. It puts the outreach resources of the New York-based Clinton Foundation together with the academic resources of the USC Marshall School to help local small businesses compete in the changing urban marketplace....

Thomas W. Gilligan, dean of the USC Marshall School of Business, said the joint project marks a new milestone in the relationship between the business school and the surrounding community while also providing undergraduate and graduate students the opportunity to join experienced professionals in working side-by-side with the businesses and organizations.

“The University of Southern California and the Marshall School of Business have a long history of engaging with the Los Angeles community,” Gilligan said. “Thanks to the vision and generosity of President Clinton and Paul Orfalea, this relationship promises to be raised to a new and exciting level.”...

For information on the Harlem Small Business Program at NYU's Stern School, see this page from Stern's website.

Simon Targets Younger Applicants

Simon Signs Direct Admission Agreement with Knox College

The University of Rochester's well-regarded Simon Graduate School of Business announced several weeks ago that it was actively recruiting younger applicants for its full-time MBA program. Now it's been announced that Simon has set up a direct admission program for undergrads at Knox College (Galesburg, Illinois).

The program allows Knox juniors and seniors to apply for direct admission to Simon after completing their undergrad degrees. Students will be granted direct admissions on the basis of leadership potential, academic preparation, and successful completion of a business internship or comparable work experience.

The program provides the selected students with more than mere convenience. Each direct admit will also receive a scholarship worth between $5,000 and $30,000 per year. Direct admits who want to be considered for scholarships above the $5,000 minimum will have to submit a GMAT score. Otherwise direct admits are spared having to take the GMAT – and excused from paying Simon's normal application fee, as well.

It looks like Simon has definitely staked its future on the strategy of drawing younger applicants with less work experience into its MBA program. A few weeks ago, Dean Mark Zupan told a Rochester TV news reporter that Simon is now emphasizing “values, attitudes, and innate smarts” over work experience in making admissions decisions. The change is meant in part to attract a more diverse applicant pool, especially in terms of gender balance (the idea being that it's easier for women to commit to a full-time MBA program before they marry and start families.)

We respect Simon's concern for diversity and its creativity in marketing its excellent MBA education to a wider range of applicants. We have to wonder, though, what impact the deliberate recruitment of younger applicants will have on the quality of the program. MBAs are professional, not academic, degrees. They prepare people for the world of work, not the world of ideas. Everyone in the classroom gets a lot more out of an MBA education when students bring a few years of real-world experience into the program with them – that's precisely why top b-schools put so much weight on work experience in admissions decisions.

Darden Adds Fifth Admissions Round for 2006

Darden Extends 2006 Application Deadline to April

[Added 9 March 2006: Darden has announced that April 27 is the Round 5 deadline. All application materials must be submitted, and an interview completed, by 11:59 p.m. EST that day. Decisions will be announced during the week of June 5 to 9.]

The University of Virginia's Darden School of Business is adding a fifth application round for fall 2006 admissions. The Round 5 deadline, which will be around April 20 or 26, should be officially announced by early next week.

This is a great opportunity for aspiring MBAs who think that Darden is a good fit for them and who would rather begin an MBA program in fall 2006 than wait for 2007 admissions. The fact that Darden has added another admissions round for 2006 suggests that there must be seats available in its MBA class.

It would be a mistake, though, to think that Darden will make any exceptions to its tough admissions standards to fill those seats. Anyone submitting an application in the added round should still plan on preparing the most focused and effective application they can get together over the coming weeks.