This is the ninth annual Financial Times ranking of full-time MBA programmes.
For the inaugural ranking in 1999, nearly 14,000 questionnaires were posted to alumni who had completed their MBA three years previously. Twenty-five per cent responded. Fifty business schools were included in the final ranking.
This year, almost 23,000 electronic questionnaires were generated. More than 10,000, or 44 per cent of alumni, responded. This is an increase of 8 per cent on last year’s response rate.
The process of compiling the survey began in July 2006 and 155 business schools that met the criteria for participation began the process.
To be eligible to participate in the FT global MBA rankings, a business school must be internationally-accredited by a body such as the AACSB, Amba or Equis; it must have a full-time MBA programme that has been running for at least five years; and it must have graduated its first class at least three years ago.
Furthermore, a school must have graduated at least 30 students from the class three years ago and in each subsequent year.
Of the 155 schools that took part initially, 113 were ranked and the remaining 42 excluded because there were insufficient alumni data.
The response threshold that the FT sets is 20 per cent of the entire class, with an absolute minimum of 20 responses. The final ranking shows the top 100 of the 113 ranked schools.
The rankings are based on data collected from two main sources: business schools and their alumni who graduated three years ago (2003). The figures are collected using two sets of questionnaires.
The criteria used in the rankings are grouped into three main areas: alumni salaries and career development; the diversity and international reach of the business school and its MBA programme; and the research capabilities of each school.
Of the 20 criteria used to determine the rankings, eight are based on data from alumni questionnaires, from “Weighted salary (US$)” to “International mobility rank”.
The data for seven of the eight criteria are collected by the FT over three years. The data for the MBA 2007 ranking (from the MBA class that graduated in 2003) carries 50 per cent of the total weight. Data from the 2006 and 2005 rankings each carry 25 per cent.
If only two years’ of data are available, the weighting is split 60:40 or 70:30 depending on whether the data is from 2007/2006 or 2007/2005. The “Value for money rank” is based on this year’s data only.
The first three criteria in the table examine alumni salaries and include the two most heavily-weighted components of the ranking: “Weighted salary (US$) and “Salary percentage increase”. Together these contribute 40 per cent of the score for each school.
The following process is applied to all salary data before it is used in the ranking:
First, salary data of alumni working in the non-profit and public service sectors, or who are full-time students, are removed.
Purchasing power parity (PPP) rates published by the World Bank are then used to convert the remaining salary data to US$ PPP equivalent figures.
These currency conversions are applied in order to iron out differences in purchasing power between different currencies, in this case so that alumni salary data can be standardised and meaningfully compared.
After the PPP conversion has been completed, the highest and lowest salaries are excluded before the average salary is calculated for each school.
Average salaries for each school are also weighted to reflect variations in income between different sectors.
The weights are derived by calculating the breakdown of sectors in which alumni are currently working. The salary data shown on the table are all US$ PPP equivalent figures.
The salary percentage increase, “Salary increase %”, is calculated according to the differences in average US$ PPP salary for each school before alumni started the MBA and today, a period of four to five years.
Eleven more ranking criteria are based on data from a survey which each business school is asked to complete. These include employment statistics, data on the gender and nationality of the students, faculty and board of the school and information on doctoral qualifications.
The final column in the table, “FT research rank”, is calculated using the FT research database. This contains papers published in 40 academic and practitioner journals during the past three years.
Each school is awarded points for the number of papers that faculty members have published. The final score in the research category is also weighted for faculty size.
The research rank is one of the more heavily weighted items in the table – it contributes 10 per cent of the final score.
After the relevant data have been compiled from the questionnaires, the results for each field are converted to Z-scores on a column-by-column basis.
That is, for each column, a separate set of Z-scores is calculated. Z-scores take into account the differences in score between each school in that column and the spread of scores between the top and bottom school.
The Z-scores in each field are then multiplied by the column weights (see table key). The multiplied Z-scores from each criterion are added across the table to give a final score for each school. This final score determines the school’s overall rank for 2007.
All the criteria which contribute to the final ranking have underlying Z-scores but in the table the data is presented as US$ equivalents, ranks, percentages, or in the case of languages, the number of additional languages required on completion of the MBA.
Additional research by Wai Kwen Chan
Database Consultant: Judith Pizer of Jeff Head Associates, Amersham, UK
