Media Rankings: A Deans Survival Guide

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Media RankingsA Deans Survival Guide

• Andrew J. Policano
• Dean
• The Paul Merage School of Business
• University of California, Irvine

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The Deans Survival KitWhat you need

• Knowledge of the mechanics of the rankings
• A well crafted rankings strategy
• A tenured faculty position

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OutlineForming your rankings strategy

• Recent trends across business schools
• Current pressures
• Strategic Reactions to the Rankings
• What schools are doing
• Open discussion of your strategies/questions
• Impact of the rankings
• The future

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The Major Trend over the past decade

• Business schools are.
• less like a school.
• and more like a
  business.

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Trends Compared to Ten Years Ago

• faculty staff engaged in degree pgms
• DOWN
• of teaching in UG MBA by tenured/tenure-track
  
• DOWN
• of resources devoted to innovation in
  curriculum
• DOWN
• of faculty and staff engaged in research
  activity
• DOWN

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Is the Trend Good or Bad?

• First
• WHY IS THIS HAPPENING?

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Three Main Reasons

• MBA Rankings
• MBA Rankings
• MBA Rankings
• OK there are other reasons

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Before we get startedLets recall 1987

• Fewer and fewer deans remember
• It was a time when
• The focus was on the learning environment
• Public relations firms were hired by businesses
  not business schools
• Few schools had marble floors, plush carpeting
  and freely flowing Starbucks coffee
• Public univ tuition was affordable and high
  potential, low GMAT students could still go to
  top schools

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1988

• BW published the first article on the rankings
  The tipping point

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Pressures
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Faculty Shortages

• Demand at highest levels since late 80s
• Schools world-wide are expanding
• Supply is falling
• Major PhD programs decreased enrollment in 90s
• 1994 1283 doctorates granted
• 1998 1165
• 2001 about 1000
• Graying of faculty
• 32 gt 55 yrs

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Implications of Faculty Shortages

• Salaries are rising and teaching loads are
  falling
• So, who will teach
• the MBA core?
• the Executive MBA?
• the Fully Employed (P/T) MBA?
• short executive programs?
• How will the School staff the undergraduate and
  doctoral programs?

Increased use of Teaching Professors, Adjuncts,
Executives in the classroom
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Pressures

• 1. Faculty Shortages
• 2. Intense Competition

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Competition from Businesses

• Increasing number of distance programs
• Numerous corporate universities for executive
  training
• Numerous partnerships between business schools
  and businesses

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Brand extension/Partnerships

• Brand name schools abroad
• Kellogg/ Hong Kong Science Technology
• Chicago/Barcelona, Singapore
• Duke/Frankfurt
• Kellogg and Wharton in India
• More importantly-brand names in your backyard
• Wharton Exec MBA in San Francisco
• Berkeley Columbia Exec MBA
• Duke Global EMBA

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Pressures

• 1. Faculty Shortages
• Intense Competition
• Resources

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Resources

• Business schools are entrepreneurial
• Business schools build endowments

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The Business School Funding Model

• B-school brings in more resources
• ?
• Campus decreases resources
• ?
• B-school brings in more resources

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Vision or Aspiration

• To be among the top 25 business schools
• Why?
• Examine constituent demands

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Constituent Demands

• Students want
• More real world applications
• Network/Jobs
• Best faculty to be in the classroom
• Higher rankings
• Parking
• Faculty want
• Higher salaries
• More research support
• Less time in the classroom
• Fewer preps bunched teaching

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Constituent Demands

• Campus Administration wants
• Business school to be cash cow/financially
  independent
• More external support for research --too applied
• Alumni/Boards want
• Less emphasis on research--too theoretical
• More influence in school
• Rankingsusually top full-time MBA program

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Where is there alignment?

• Students and alumni
• Higher rankings
• Campus and faculty
• More funding
• Happier is todays student and tomorrows alum
  the more funding will increase
• From cradle to
• endowment
• So, increase rankings

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Playing the Rankings Game A Dose of Reality

• Everyone wants to be in the top 25
• Theorem
• There are only 25 schools in the top 25

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Corollary

• There are 50 schools in the next 30
• Why?
• There is little statistical difference in these
  schools
• There are many rankings
• Always some ranking where you in top 50
• Problem all 75 are investing to be in top tier

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What does it take to break the top 25?
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Determinants of a Top Ranking

• Location
• Wealth of school
• Tradition/brand recognition
• Quality of incoming class
• Quality of the delivery of the curriculum
• Very active, supportive dean
• Separation from undergrad program
• Happy students and recruiters

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The facts

• Business Week 2004 ranking
• 9 of the top 10 are private
• (10/10 if you recognize that Michigan is private)
• 3/4 of the top 30 are private
• Only 3 of top 30 are gt 100 miles from large city
• Many have no or very small undergrad pgm

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The facts (U.S. Schools only)

• US News, BW, FT 2002 2004
• Agree on 17 of top 20 schools
• In 1987, same 17 listed in MBA magazine
• 8-10 schools move in out of top 20
• Next 20 show very little statistical difference

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The Cost of a Top Ranking

• Cost of being in top tier is escalating
• Effects pervade all schools
• Cost of fundamental research, doctoral pgm
• Significant cost associated with MBA rankings
• Many B-Schools have redesigned their strategy
• The business of the business school
• Leverage localized monopolies
• Focus on niches or specialized majors
• Decrease the size of the undergraduate programs

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Strategies Brand Name Programs

• Top 15 - 20
• Increase F/T MBA until quality levels off
• Increase P/T MBA forever
• Extend brand in new locations
• Partner with other top 15

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Strategies Next 50

• Decrease size of F/T MBA program
• 15-30 group.200-250 new entrants
• gt30.. 60-150 new entrants
• Then increase if possible
• Fallacy
• Can increase ranking when everyone is doing the
  above
• How can you be different?
• Move to specialized masters

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Strategies Next 50 (cont)

• Divert resources from UG, Doctoral, Research to
• Marketing
• Public Relations
• Student satisfaction
• Recruiter satisfaction
• Interaction with alumni/boards

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Strategies Next 50 (cont)

• Try to leverage local monopoly
• Be best B-School on the block
• Expand EMBA
• Expand Fully Employed programs
• Expand Custom executive programs
• Problem Wharton in your backyard

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Strategies

• Find rankings where you look good
• Create distinctive specialized programs
• Convince constituents that
• No difference between 30 50
• Can be an excellent business school w/o a top 25
  full-time MBA program

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Negatives

• Variables dont measure quality
• Many self-reported
• Data is not audited
• Rankings reduce complexity to a single number
• Focus mainly on F/T MBA
• Has hurt undergrad and doctorate programs

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Positives

• Helps students better choose between pgms
• Helps schools to improve
• Do you agree?

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OutlineForming your rankings strategy

• Trends in the Business School Industry
• Current pressures
• Strategic Reactions to the Rankings
• Open discussion of your strategies/questions
• The Future

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The Future Ten years from now

• More specialized faculty
• Teaching faculty
• MBA
• Undergraduate
• Research faculty
• Doctoral program
• Executive education faculty

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Ten Years From Now

• Third Tier
• Will be stronger
• Today, admitting students 2nd tier used to admit
• Will be more innovative

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Ten Years from Now

• Top 15
• More dominant/larger MBA enrollments
• Fortune 100// Business Week 15
• Next Tiercottage industry
• Relative ranking pretty much the same as today
• Smaller F/T programs
• Weaker research and weaker undergrad program
• Top publics will essentially be private
• End of public university pricing/access to top
  business pgms
• More focus on specialized masters
• Regional focus plus international partnerships

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Questions to Ponder

• What is the purpose of a business school?
• Declining value of research
• Passion for learning replaced by passion for
  paycheck
• Who will lead business schools?
• In 2004, in survey of deans
• ½ had been in office lt 3 years
• ¼ had been in office lt 1 year
• This is where that tenured faculty position comes
  in

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What the Business School Industry has been doing

• Currently in process
• Make data easily available (GMAC, AACSB)
• Cooperate with media to define variables and
  standards (GMAC, AACSB)
• Audit data (GMAC, KPMG)

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Next steps

• For GMAC/AACSB
• Provide service for schools
• Type/definition of data sent to media must be
  cleared by schools/media task force
• Convince media to
• Place more emphasis on research
• Rate schools dont rank them

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Summary

• Stakes are rising rapidly
• Develop a niche strategy that plays to
• core competencies
• localized monopolies
• Become increasingly entrepreneurial
• Increasingly seek support from alumni
• invest in alumni and external relations