Here are the 20 best MBA programs in the U.S. for 2013 according to Forbes:
|SCHOOL AND RANK||PRE-MBA SALARY||2012 SALARY|
|1. Stanford GSB||$80,000||$221,000|
|2. Chicago Booth||$76,000||$200,000|
|3. Harvard Business School||$80,000||$205,000|
|4. UPenn Wharton||$80,000||$205,000|
|5. Northwestern Kellogg||$73,000||$176,000|
|6. Dartmouth Tuck||$72,000||$189,000|
|7. Columbia Business School
|8. Duke Fuqua||$63,000||$152,000|
|9. Cornell Johnson||$59,000||$155,000|
|10. Michigan Ross||$61,000||$153,000|
|11. UNC Kenan-Flagler||$60,000||$141,000|
|12. MIT Sloan||$70,000||$185,000|
|13. UCLA Anderson||$65,000||$165,000|
|14. UC Berkeley Haas||$71,000||$175,000|
|15. UVA Darden||$67,000||$158,000|
|16. CMU Tepper||$60,000||$135,000|
|17. Brigham Young Marriott||$50,000||$109,000|
|18. Yale SOM||$54,000||$144,000|
|19. Indiana Kelley||$50,000||$120,000|
|20. Iowa Tippie||$46,000||$118,000|
For more info, please see Forbes’ lead article “Stanford Tops 2013 List Of America’s Best Business Schools.”
Why the Forbes Ranking Matters
The Forbes ranking is interesting for one simple reason: It focuses exclusively on ROI five years after graduation. This year Forbes looked at the graduates of 2008, the class that graduated into the Great Recession, the financial melt-down, and the collapse of Lehman Brothers and Bear Sterns. It was a tough time to launch a career.
Forbes heard from almost 5,000 grads from 100 schools and “compared their earnings in their first five years out of business school to their opportunity cost (two years of forgone compensation), tuition and required fees to arrive at a ‘5-year M.B.A. Gain.’” It ranks programs based on that pre-tax gain. (For the details of Forbes methodology, click here.) It does not include programs where less than 15% of alumni responded or where there was negative ROI. It also does assume reduced increase in salary without an MBA.
• It relies on reporting from grads who have an interest in their alma mater being highly ranked. In other words, like all surveys, it can be gamed.
• While Forbes does attempt to reflect financial aid and differences in cost of living, it doesn’t reflect disparities in varied industries and functional roles. You are going to go into a specific field and industry. The averages in that industry are going to matter to you more than the average of the graduating class at your business school.
• In its methodology Forbes assumes that without an MBA, the candidates would have had half the increase in salary that they had with the MBA. I don’t know if there is any data supporting that assumption, or if it is generous or stingy.
Take-Aways from the Forbes Ranking
Despite the potential flaws, the Forbes ranking does have value. I noticed or took away the following:
1. An MBA from a top MBA program pays, and pays well. It doesn’t, or didn’t, pay off as quickly as it did 10 years ago, but it pays. A 3-5 year payback with gravy for the rest of your career is an excellent investment. And if you are lucky enough not to graduate into the kind of almost unprecedented financial disaster the Class of 2008 faced, you should have a shorter payback period and higher gain. This is the clearest conclusion from the Forbes ranking. To me, it is far more important than any individual school’s actual rank or even movement of one school since 2011, when Forbes had its last ranking.
2. The schools with the shortest payback period were NOT the highest ranked programs. They were BYU Marriott, Indiana Kelley, and Iowa Tippie. See “Busting Two MBA Myths.”
I’ve said it before and I’ll say it again. Use rankings for the data they provide and as sources of insight into trends over time. Don’t view any individual ranking as an influential factor in choosing where to apply or where to attend. And for heaven’s sake, take the time to understand what is actually being ranked and evaluated.
By Linda Abraham, president and founder of Accepted.com and co-author of the new, definitive book on MBA admissions, MBA Admission for Smarties: The No-Nonsense Guide to Acceptance at Top Business Schools.