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Should you really go with the FT’s new MBA ranking? Or is there a better, more finance-focused alternative?

The pink roofs of Stanford Business School

You’re thinking of doing an MBA in financial services, but where should you study?

The Financial Times’ 2012 MBA ranking is out today.

It ranks the top 10 global full time MBA programmes in 2012 as follows.

The FT’s 2012 full time global MBA ranking:

  1. Stanford Graduate School of Business
  2. Harvard Business School
  3. University of Pennsylvania (Wharton)
  4. London Business School
  5. Columbia Business School
  6. INSEAD
  7. MIT: Sloan
  8. IE Business School
  9. Iese Business School
  10. Hong Kong UST Business School

What determines this ranking? MBA blog Poets and Quants says the FT places a lot of emphasis on compensation. In its own explanation of its methodology, the FT confirms that compensation-related measures (weighted salary and salary increase) account for 40% of the ranking. By comparison, career progress, placement success and employment at three months account for only 7% in total.

This may be why INSEAD ranks sixth in the FT’s ranking, despite only 84% of its MBA class being in employment three months after graduation. Equally, Stanford likely ranks first because it has the highest weighted starting salary ($192k).

But what if you don’t want to go with a ranking based primarily on compensation?

The Businessweek and Economist rankings

Needless to say, Businessweek also offers a popular MBA ranking, as does the Economist. Both are more US focused, although the Economist ranks IMD in Switzerland third and Businessweek ranks IE in Madrid fourth.

Both the Economist and Businessweek focus on different metrics to the FT and come up with different top schools.

45% of Businessweek’s ranking is derived from student surveys, 45% is derived from recruiter surveys and 10% is attributed to intellectual capital. The Economist attributes only a 20% weighting to pay, ascribing far more importance to career opportunities and personal development (70% of the total).

Businessweek’s top 5 business schools globally for full time MBA Programmes (2011):

  1. University of Chicago (Booth)
  2. Harvard
  3. University of Pennsylvania
  4. North Western University
  5. Stanford University

The Economist’s top 5 business schools globally for full time MBA Programmes (2011):

  1. Dartmouth Tuck
  2. Chicago Booth
  3. IMD
  4. University of Virginia Darden
  5. Harvard

Best MBAs for finance

Confused? You may well be, especially if you intend to use your MBA specifically to get a job in financial services. If this is the case, it may be advisable to steer clear of generic league tables altogether.

Helpfully, Businessweek offers information on the top full time MBA recruiters at each school. This suggests that Columbia is particularly popular with both Goldman Sachs and Credit Suisse. European schools like INSEAD and IMD appear more popular with consulting firms and corporates.

Most helpfully however, Top MBA provides a ranking of the best business schools specifically for finance. These, it lists as follows (for 2011), with the top 7 all ranked equally:

  1. Wharton
  2. University Chicago (Booth)
  3. London Business School
  4. NYU Stern
  5. Harvard
  6. Columbia
  7. INSEAD
  8. IE Business School
  9. Stanford
  10. Kellogg

Schools like Cass and Cranfield rank 24th and 45th for finance respectively. Top MBA bases its ranking on conversations with employers, who are asked which schools employers most wish to recruit from. Forget pay: in today’s environment, this is arguably the most helpful metric to take into consideration when you’re choosing where to study.

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