One aspect that I have always been proud of about Cambridge is the level of openness that our senior members of staff have with students. The Director of the MBA addressed the MBA students on Monday and discussed the FT rankings, putting into context the areas where we have improved and areas where we need to do better. I am not sure how many other schools do this.
It was a closed door session so I won’t share any of the discussions here. I should say that the School itself is not driven by rankings. We do not introduce new policies to improve our ranking if they dilute the MBA program or the unique aspects of the Cambridge MBA. In fact, we adopted some policy changes to improve the MBA program but ironically, these changes are detrimental to certain aspects of our ranking. But we are also conscious of the impact that the MBA rankings have in shaping the perceptions of prospective candidates and also impressions of the Business School itself.
I wanted to share and discuss some of my observations of the FT ranking. I repeat, these are my personal observations.
One main area of interest from this year’s FT rankings is the strong performance from Asian business schools. I ran an analysis last year of FT rankings and found that there is a huge amount of inertia in the top 10, which makes HKUST’s rise within the top 10 even more impressive. There are also two Indian MBA programmes and Ceibs who are in the top 20.
The Asian schools that did well had very good scores in weighted salaries and/or high percentage salary increases — IIM Ahmedabad’s MBA has the second highest alumni weighted salary in the entire ranking. This is a reflection of the growing economies in China and India, and quite possibly the PPP conversions that the FT uses. I don’t know enough about the PPP effect so would welcome any comments. On salary percentage increases, I calculated the weighted alumni starting salaries and found that Ceibs, HKUST and ISB have some of the lowest starting salaries, which creates a large percentage increase when you consider the weighted alumni salary. Because the FT uses a Z-score methodology to award raw points in each category, these schools were doubly rewarded for scoring so high above the mean in that category.
Some commentators have queried how much of these large salary increases were due to the respective MBA programs, and how much were due to large upward movements in salaries of skilled professionals in Asia, of which the supply in China and India has not kept pace with the meteoric growth in these countries. I don’t want to downplay the good work that these schools are doing but I would say to these commentators that any mechanism to strip out the effects of economic growth on alumni weighted salary should also have been applied to US or European schools during the heady days before the credit crunch.
I thought that more people would have pointed to the increase in the number of Asian schools in the ranking as another indication that the pendulum is swinging towards the East. I think there are merits to this argument but from my own observation, most people in Asia realise that they do not need an MBA from Asia. There is little that an MBA in Asia could teach them about working in Asia that they didn’t know since they are already living and working there.
On the contrary, there is greater value for Asians to attend an MBA outside Asia. Asian companies want to globalise. To do that effectively, they need talent who understand working across different cultures, and who can still relate to the companies’ Asian contexts. You don’t get the former by studying in Asia. Having studied in the US and the UK myself, I am completely convinced of the value of an internationally diverse MBA, one which brings together students from different backgrounds and who have a global mindset.
Another observation is the large number of criteria that have very little to do with the quality of an MBA programme. The FT ranking features criteria such as the the research output of faculty regardless of whether they teach on the MBA, the number of Phds who graduate, the composition of the School Advisory Board and the composition of the faculty. My own view is that such criteria are important but should be measured in a ranking of business schools in general rather than of the MBA programs.
This brings me to another point which is how the public conflates the MBA with the business school. Many business schools have other good programs but because the MBA rankings capture so much of the public attention, it is easy to associate an MBA ranking as a de facto ranking of the business schools themselves. Unfortunately, this confusion will only grow as business schools introduce more variants of their MBA program. For example, some students asked me why was IIM Ahmedabad’s MBA ranked so highly when they know many students who took another MBA in the US and UK years after completing their MBA in IIM-A. I had to explain that IIM-Ahmedabad was ranked based on its much smaller Post-Graduate Diploma in Management for Executives programme (PGPX) and not on their larger and more established PGP.
I will just conclude by saying that I am proud that we take a balanced view of rankings. Of course we want to perform well in the rankings but we are even more focused about individual criteria which we feel are important to our MBAs, and which measure the progress that we are making in terms of fashioning a unique MBA program. Seen in that light, I am happy that we are one of only two schools to be in the top 20 in each of the following categories : weighted salary, aims achieved, value for money, career progress and international mobility.
I am sure most of you would have taken my position as Head of MBA Admissions in Cambridge into account when reading this post. Let me know what you think.