Business schools are big on teaching how to compute and utilize return on investment. So it’s fair to turn the technique on them, as BusinessWeek did recently.
Its ROI-based ranking – entirely separate from the magazine’s overall ranking of the best undergraduate B-schools for 2010 – pegs the private institutions with the best bang for the buck as: Cornell, DePaul, MIT Sloan School of Management, Hofstra’s Zarb School of Business, and Brigham Young University’s Marriott School of Management.
To compute ROI for undergraduate business programs at both private and public universities, BusinessWeek compared annual tuition with median salaries attained by an institution’s new graduates. The results are ultra-sensitive to low tuition – which in relation to the public schools at least, brings to mind the old saw, “You get what you pay for.”
The best deal among the 10 schools mentioned seems to be Cornell. While placing second in ROI among private schools, it also placed fifth in BusinessWeek’s separate overall ranking that draws on student and corporate recruiter surveys, top-MBA-school admission rates, and various measures of academic quality. Because Cornell receives public support, undergraduate tuition in the business program is $22,000 per year – as much as 50 percent less than other Ivy League universities.
Brigham Young took the top spot, but was clearly an outlier. Most students there belong to the Church of Jesus Christ of Latter Day Saints and pay a mere $2,100 per semester – 80 percent less than the cost of the next-least-expensive private institution – in recognition that members donate a significant portion of their income to the church. Brigham Young does deliver the goods, though: 95 percent of its students who reported employment information last year had received at least one job offer by graduation.
BusinessWeek also lists the top five public undergraduate business programs by ROI. There, the results are so one-dimensional – bargain-basement tuition being the sole driver of rankings – that you have to wonder why the magazine doesn’t overhaul its clearly faulty methodolgy.
At University of Central Florida, which topped the public-school ROI list, the job placement rate by graduation time was a mere 27 percent. At No. 3 Florida International University (where many graduates are the first in their families to attend college), the figure was just 17 percent.
One well-regarded public business school did make the ROI top five: Kenan-Flagler Business School at the University of North Carolina at Chapel Hill. It placed 14th in BusinessWeek’s overall ranking of undergraduate programs, and 5th among public institutions in ROI.