Introduction

In the long list of decisions that all young adults must make, deciding whether to pursue an advanced degree is easily among the most difficult and complex. The fact that you’re holding this book in your hands means that you’re already well on your way to choosing the potentially life-altering path that business school represents. Like all advanced degrees, an MBA, should you choose to get one, will open doors that were once closed. But unlike nonbusiness degrees, where career paths are fairly well defined from the outset, an MBA represents a ticket to many shows. It can be used to pursue any number of paths up the corporate hierarchy, bring modern management techniques to nonprofit organizations at work in the developing world, or start a new business. It can even take you to the White House. That wealth of possibilities makes choosing an MBA program significantly complex.

This guidebook is an outgrowth of BusinessWeek’s rankings of business schools, which began in 1988 with our first ranking of full-time MBA programs. Since then, the magazine has launched numerous other franchises, including a ranking of executive MBA programs in 1991 and a new ranking of part-time MBA programs last year. In this book, you’ll find detailed statistical profiles of more than 100 programs of all three types, including both domestic and international full-time programs, that came out on top in the most recent rankings. But this book is only the beginning. In fact, BusinessWeek’s coverage of management education extends far beyond the pages of this book and of the magazine itself.

At BusinessWeek.com, you’ll find a wealth of additional content. There are lengthy profiles of more than 300 schools, including expanded versions of the profiles in this book, along with interactive tools, blogs, journals of current and recently graduated MBA students, and video interviews with dozens of B-school deans, admissions officers, and placement directors. You’ll also find something that cannot exist between the pages of any book or magazine: community. On our message boards, you can take part in online chats with admissions and placement professionals, connect with students and alumni who have gone through a program you’re considering, seek advice about the admissions process, and make new friends. You can access the site at www.businessweek.com/bschools/.

Choosing a B-school is an intensely personal process, one that inevitably includes a great deal of introspection about career goals, financial resources, academic strengths and weaknesses, work and family demands, and myriad other factors. But for the vast majority of prospective students, it can be reduced to three questions: Why? When? and Where?

Why Apply to B-School?

By the time most prospective MBA students ponder this question, they are about 27 years old, with about five years of work experience under their belts. This means one of several things. They may be in a career that they no longer like. They may have hit a career plateau and be unable to advance without additional training. They may have been laid off. They may have caught the entrepreneurial bug and be hankering to start a business of their own. Any one of these is a legitimate reason for applying to B-school. In fact, the three main reasons people enroll in an MBA program are to jump-start a career that’s stalled, head off in a new direction, or simply make more money.

One thing is virtually guaranteed about MBA programs: students will earn far more money after graduation than they did before they got their MBA. In 2006, among schools that participated in BusinessWeek’s ranking of full-time MBA programs, graduates who answered our survey had salaries averaging $93,400 after graduating, an increase of $31,700 over what they earned in their pre-MBA days. In 2006, that MBA premium of better than 50% was the best since 2000. The reason is simple: for corporate recruiters, graduates of these top programs add bottom-line value to their organizations. They bring analytical abilities honed by two years of classroom practice and the ability to bring fresh thinking to old problems. Many prove themselves quite adept at climbing the corporate ladder, where their impact is magnified, with compensation to match. A 2003 BusinessWeek study tracking the career outcomes of nearly 1,500 alumni of the Class of 1992 from our Top 30 B-schools found that their average salaries had nearly tripled—from $56,600 in their first post-MBA job to more than $155,200 ten years out. Average total compensation, including bonuses, was a staggering $387,600. The typical alumnus from the study had three different post-MBA employers and four promotions since graduation ten years earlier. (See What’s an MBA Really Worth? page xix.)

The three main reasons people enroll in an MBA program are to jump-start a career, head off in a new direction, or simply make more money.

One reason that MBA earning power stays strong over time, and a compelling reason for undertaking an MBA in the first place, is the value of the specific MBA brand. When you graduate from Harvard Business School, for example, you don’t just graduate with a cookie-cutter MBA. You graduate with the same MBA that propelled generations of Harvard alumni to the top echelon of corporate power, every one of them with a lifetime of achievement that reflects back on their alma mater. In effect, when employers hire a Harvard graduate, they’re making a calculated gamble that that person will show the same kind of extraordinary promise. If nothing else, a Harvard MBA—or an MBA from any other well-known program, for that matter—guarantees that you’ll stand out from the crowd. After all, just getting into Harvard, which turns down 85% of all applicants, is something of an accomplishment in itself. Research has shown that during the recruiting process, the prestige factor counts for more than anything else—surpassing in importance even the candidate’s skills and abilities. The more prominent the school, the higher the salaries notes Violina P. Rindova, an assistant professor of strategy at the University of Maryland who coauthored the research.

OK, now we know why you should get your MBA. But there are also compelling reasons why you shouldn’t. One thing to consider is timing, which we’ll get into in more detail a little later. Applications to B-school are a countercyclical phenomenon: they tend to increase when the economy is contracting, and decrease when the economy is firing on all cylinders. A big increase in applications during an economic slowdown often results in a glut of new MBA graduates two years later, just as the economy is heating up again—and a lot of competition among them for the best jobs. So a slowing economy by itself isn’t an adequate reason to get an MBA, and getting one at such a time is a strategy that could backfire at graduation. Bottom line: if you’re out of work and a slowing economy will make it difficult for you to find a high-paying job—or any job at all, for that matter—then B-school might be a good use of your time. If you’re gainfully employed in a job you enjoy, you’ll probably want to think twice before you give it all up for B-school, or at least give serious thought to a part-time or executive MBA program that allows you to continue working.

Another bad reason for applying to B-school is the notion that an MBA is a sure-fire ticket to the corner office. It’s not. A 2006 BusinessWeek study found that only about a third of the highest-paid executives at S&P 100 companies—chief executive officers and their top deputies—have MBAs. Of the more than 250,000 living alumni of BusinessWeek’s top 10 MBA programs, only 71 made it into the ranks of the highest-paid. Among the CEOs who made it to the top without the help of an MBA are Frederick W. Smith at FedEx Corp., Steven A. Ballmer at Microsoft, and H. Lee Scott at Wal-Mart. The main reason that an MBA is not a ticket for admission into the ranks of top executives is the way in which such personnel decisions get made at the highest levels. In the pure Darwinian world we live in, pedigrees mean nothing, says Peter D. Crist, chairman of Crist Associates, a Hinsdale, Illinois, executive search firm. It’s instinct, it’s hard work, and it’s raw intelligence. (See Is the MBA Overrated? page xx.)

An MBA is a big investment—in money, time, and effort—so before you apply, it’s important to consider whether the program will actually teach you anything that you don’t already know. If you received an undergraduate business degree and have spent five years learning on the job in a midlevel managerial or consulting position, it might not. A better use of your time might be an extremely targeted nondegree executive education program or—if you’re contemplating a career switch—a degree that will better prepare you for the nonbusiness side of your new position, such as science or medicine. Some universities now offer joint programs that would be a good fit in such a situation—such as the nondegree executive education program in biotechnology now offered by Northwestern University’s Kellogg School of Management and the medical school at Johns Hopkins University.

When Should I Apply to B-School?

The answer to this question is more complicated than it seems. There is no perfect time to attend B-school, so the question that you, as a prospective student, need to answer is when most of the planets will be aligned in your favor. Since the process of applying to B-school can easily take more than a year—from the initial research and taking the GMAT to completing the applications and awaiting the admission decisions—timing should be something that you give serious thought to long before you make a commitment to B-school. You should think of this as a two-step process. In the first stage, you’re deciding whether B-school is even possible given your marital status, where you are in your career, and what kind of financial resources you have at your disposal. If you decide that it is, then you need to decide how to time your application to maximize your chances of getting into the best possible program.

B-school is not just a huge commitment for you; it’s a major hassle for everyone around you, especially (if you have them) your spouse and children. (See Can Your Relationship Survive B-School? page xxii.) At the very least, much of the free time that you would otherwise use for family events—from spending time with your spouse to going to school plays—will be spent studying. Should you decide to attend a school far from home, you’ll have an additional decision to make: will you uproot your family, or will you commute home on weekends? If your spouse or children are opposed to your B-school plans, you may want to shelve them for a while, or limit yourself to part-time or executive programs closer to home. But your family is only one piece of the puzzle. If you’re employed, a full-time program will require you to quit, while a part-time or executive program may eat into some office hours. Since the total cost of a two-year full-time program, including forgone salary, can easily top $300,000, you need to investigate your financial resources as well. Do you have adequate savings? Are you eligible for financial aid? How much debt are you comfortable taking on? All this needs to be taken into consideration.

In 2006, graduates who answered our survey had salaries averaging $93,400 after graduating, an increase of $31,700 over their pre-MBA days.

So your family is onboard, your resignation letter is written, and money isn’t a problem. What’s next? The next step is deciding how to get into the best program and how long it will take you to polish up your application. You want to make sure that your credentials—especially your GMAT scores, work experience, and undergraduate grades—are exactly what the top B-schools are looking for. When all these ducks are in order, the time is perfect to apply.

At this point, there’s nothing you can do about your undergraduate grades, but GMAT scores are another matter entirely. It’s worth taking the test early in the decision-making process in order to find out where you stand relative to the requirements for the schools you’d like to apply to. If your heart is set on a top 10 school, prepare to sharpen your No. 2s: GMAT scores for those programs averaged 707 in 2007, and anything below 650 is likely to rule out most applicants. If your first score is below 700, it’s worth the added expense and effort to take a GMAT preparation course and retake the test to increase your grade. Another option is to scale back your expectations a bit. There are many top 30 B-schools, including the University of Maryland’s Robert H. Smith School of Business and Washington University’s Olin School of Business, where GMAT scores average about 650 and applicants with scores below 600 are routinely accepted.

Even more important than GMAT scores is work experience. It’s not just the amount, but the quality of the work experience that matters. So put your résumé under a microscope. How much postundergraduate work experience do you have? Students at top 30 schools who responded to the BusinessWeek survey in 2006 had nearly five years’ experience on average—anything less and you might want to delay the application process. The one exception: a small, but growing, number of MBA programs that are beginning to reach out to early career applicants with fewer than three years of work experience, and in some cases none at all. (See B-Schools: You Don’t Have to Wait, page xxiv.)

While time on the job is important, it’s not the only thing that admissions directors look for. Have you managed a team? Have you held a leadership position? Do you have a record of extraordinary accomplishment that will make your application stand out? If so, it may not be necessary for you to wait until you have the requisite five years’ experience. But if you’re expecting a promotion or a big increase in responsibilities, or if a pet project is about to reap big dividends for your company, it may be smart to delay your application until that happens.

The more prominent the school, notes University of Maryland researcher Violina P. Rindova, the higher the salaries.

Finally, consider the economy. As noted earlier, MBA applications tend to increase when the economy slows down. After a three-year decline, application volume has been on the rise since 2004, with two out of three programs reporting a year-over-year increase in 2007. (See MBA Applications Surge, page xxiv.) Some top B-schools have also reduced class size for a variety of reasons, including new resource-intensive curriculums. (See More Crowding at Top B-Schools, page xxv.) The result: many MBA programs are getting pickier about whom they’ll admit. In 2006, one out of every five applicants to the top 10 B-schools received an offer of admission; at Stanford, it was one out of 10 in 2006 and one out of 13 in 2007. In such an environment, it becomes more difficult for all but the very best applicants to get in. However, when applications decline, as they do when the economy is growing, a larger percentage of applicants is accepted, making it easier for students with less than perfect credentials to get a foot in the door.

So you’ve taken the GMAT twice and your score now tops 700. You have five years of work experience, four of it spent in a managerial role, during which you launched a new and highly successful business for your company. Applicant volume has been trending upward, making it harder to get in, but you’re confident of your credentials. If you’re ready to take the plunge, there’s only one question left: when to actually submit the application. The rule of thumb here is, the earlier, the better. Most schools have final application deadlines between March and June, but you should plan to submit your application no later than early January for fall admission. The competition is generally tougher in the early rounds, but applications that are not immediately accepted are reconsidered in later rounds—in effect, you get two bites at the apple instead of one. This also leaves you plenty of time to visit campuses, set up interviews, and decide whether you’ll accept an offer of admission if one is made.

Where Should I Apply?

For many prospective students, the search for programs to apply to begins and ends in one place: the rankings. (See The Best B-Schools of All Time, page x.) That’s a big mistake. While the rankings are important, they are far from the only thing that matters when choosing a program, and in many cases the program that is right for you is not necessarily the one that is most highly ranked. There are important differences between full-time, part-time, and executive programs, and between domestic and international programs. There are some schools, like the University of Chicago Graduate School of Business, that focus on quantitative skills, and others, such as Northwestern University’s Kellogg School of Management, that have teamwork and communication skills at their core. After graduation, some programs funnel students into big financial services companies, some have deep recruiting relationships with Big Four accounting firms, and others serve as incubators for tomorrow’s entrepreneurs. All this should be factored into your decision.

Luckily, you are already in possession of the tools you need to parse the pros and cons of more than 100 programs of all types. In the profiles that follow, and in those available at BusinessWeek.com, you’ll learn the things you need to know in order to determine if a program is right for you. These include the top functional areas for graduates, the biggest on-campus recruiters, leading areas of study, teaching methods, even prominent faculty. You find out about average class size, the number of business electives, and how students rated everything from teaching quality to career services to the curriculum.

To narrow the field, a good place to start is deciding what type of program is right for you. If you haven’t already chosen a full-time, part-time, or executive MBA program, there are important distinctions to consider, starting with the basic program format. Full-time programs are complete immersion experiences. In most cases, you will proceed through the program with a cohort of students, attending many of the same classes, working together on long-term projects, and taking part in extracurricular activities. You’ll also bond with classmates in a way that frequently results in the creation of extensive postgraduation networks that are critical to career success—one of the most valuable parts of any MBA program.

If your heart is set on a top 10 school, prepare to sharpen your No. 2s: GMAT scores for those programs averaged 707 in 2007.

Part-time programs are increasingly popular because they allow students to remain employed. But because they usually meet only a few times per week, they also take longer to complete—typically anywhere from three to six years. And since students in many cases don’t proceed through the program in cohorts, the relationships forged during the program are frequently not as intense or long-lasting. To complete and succeed in a part-time program requires a level of self-discipline that many already overworked employees just can’t muster.

Executive MBA programs, originally designed to enhance the management skills of high-potential executives, generally meet on weekends, so face time with professors and classmates is limited. What’s more, EMBA programs are changing. At one time, companies would foot the entire bill for executives they enrolled; today, only about a third of all EMBA students are entirely company sponsored. And such support, when offered, usually comes with strings attached—a promise to remain on the job for at least two years postgraduation. The result: a lot of the people who are enrolling in EMBA programs are job-hoppers or career switchers—in short, they aren’t all that different from those that you’d find in full-time or part-time programs.

If you’ve settled on a full-time program, there’s one other decision you need to make: should you stay in the United States to get a degree or go overseas to do so? Each has its advantages. In the United States, you’ll find the best management education available anywhere. The value of a degree from a top-ranked U.S. school such as Wharton, Stanford, or MIT is almost incalculable—in virtually any country in the world, such names are instantly recognizable as centers of academic excellence and powerful brands in their own right. At best, though, only about a third of the students you’ll encounter in these programs come from outside the United States. At many international programs, particularly those in Europe, that figure is likely to be two-thirds or more—in effect, every classroom is the business equivalent of the United Nations. Such classroom diversity is an attractive asset for U.S.-based students who are seeking a global perspective in the classroom and hoping to launch their careers overseas after graduation. As a result, the number of American students signing up for overseas MBAs, while still only a tiny fraction of all U.S. MBA students, has nearly doubled in recent years. Another major attraction of leaving the United States to study: many European MBA programs can be completed in 18 or only 12 months, essentially cutting the price in half.

Once you’ve decided on the program format and location, the hard work of matching up individual programs with your goals and aspirations begins. If you know what your major will be, finding schools that list that specialty as either a leading area of study or a top functional area for graduates is a fairly simple matter. But then it’s time to dig deeper. For example, let’s say that you’ve got your heart set on both a top 10 full-time MBA program in the United States and a career in consulting. At No. 1–ranked University of Chicago, 22% of the graduates go on to careers in consulting, and the top 15 recruiters include such giants of the industry as McKinsey, Booz Allen Hamilton, BCG, Bain, and Accenture. So far, so good.

But post-MBA pay is the lowest among the top 10 schools, just $95,000. And the school, which is well known for its analytical rigor, might not be the best fit for someone looking for a program that emphasizes soft skills such as communication. Put it in the maybe pile. How about No. 3–ranked Kellogg? Post-MBA pay is significantly higher—$105,000—and more graduates go on to consulting careers. Many of the same top firms recruit there, including McKinsey, which hired more graduates at Kellogg than it did at Chicago. What’s more, judging from the student comments, the curriculum is more teamwork focused, and the culture is marked by camaraderie and collegiality. Put that in the probably pile.

A big increase in applications during an economic slowdown often results in a glut of MBA graduates two years later—and a lot of competition for the best jobs.

As you continue your homework, you’ll probably want to expand your analysis well beyond career outcomes and major strengths. Are small classes important to you? What about a large selection of electives? Teaching quality? Internships? You’ll also want to listen closely to the student voices you hear, both in the student comments section of the profiles in this book and in the online forums. Do these sound like people who have enjoyed their experience and gotten a lot out of it? Or do they sound unhappy? You may even consider things that are completely unrelated to B-school. Are you happier in a city? If so, Columbia, New York University, Chicago, or any of the other large urban campuses might be a good choice. If you’re more of a nature buff, a program like Dartmouth’s Tuck School—an intimate program tucked away in the New Hampshire mountains—might be better. (See A Small B-School Can Be a Big Plus, page xxv.)

For the most part, all B-school curriculums are variations on the same pedagogical theme. No matter where you go, a large part of the instruction you receive will involve case studies, each an in-depth analysis of a company that requires students to bring all their knowledge to bear on a problem. You will also probably take basic courses in accounting, finance, marketing, statistics, and economics, as well as electives that depend largely on your major. (Chicago, where there are no mandatory courses except for a special orientation program, is an exception; students there are allowed to pursue advanced studies if they already know the basics.) But even within that basic framework, there is great variation. Schools such as Harvard and Darden, for example, focus on teaching general management rather than narrow technical specialties. As a result, their graduates tend to fare well in fields like consulting. Other schools have niche programs designed to give them a national profile. Babson, for example, has developed a renowned program in entrepreneurship, while Vanderbilt has a program in e-commerce, and Michigan State offers training in supply chain management.

Indeed, the vast number of choices can seem paralyzing at first. The number of programs, in the United States and abroad, accredited by the American Association of Collegiate Schools of Business now approaches 550, up from 322 ten years ago. But that’s actually a good thing. With so many permutations on the MBA theme, your chances of finding a program that truly meets your needs are quite good. And your chances of finding one that will help you achieve your career goals—whether you want to be an analyst at a top financial services firm, a strategy guru at one of the top consulting companies, or the next Steve Jobs—are excellent.

Of course, the key word here is help. No MBA program will hand you the career of your dreams on a silver platter. At best, it will give you the tools you need to realize your ambitions. Everything else? Well, that’s up to you.

About the Profiles

The programs profiled in this book are those that were ranked by BusinessWeek. For the full-time programs, we included the top 30 domestic and top 10 international schools from our 2006 ranking, as well as an additional 13 second-tier schools. Also included are the top 25 executive MBA programs and the top 30 part-time MBA programs (five from each of six geographic areas) from our 2007 rankings. The rankings are based on student surveys conducted by BusinessWeek with the help of Cambria Consulting Inc., as well as additional information gathered by the magazine staff. For additional information about our ranking methodologies, visit our Business School Rankings & Profiles page at http://www.businessweek.com/bschools/rankings/ and click on the FAQ.

Most of the statistical information in the profiles was provided by the schools themselves. When schools declined to provide the information and we relied on BusinessWeek survey data, this is footnoted. The remainder of each profile is based on BusinessWeek research, including surveys of students, recruiters, and executive MBA directors. In almost all cases—such as GMAT scores and work experience—the numbers represent averages, not medians. In most cases, the data concerning students reflect either the newest entering class or the most recent crop of graduates.

Some of the statistics in the profiles might not be familiar to all readers. Selectivity is the percentage of applicants accepted. Yield is the percentage of accepted applicants who enroll. Post-MBA salary increase is simply the difference between the average salary students had when they entered the program and the average salary they received upon graduation. Total first-year compensation includes average salary, signing bonus, and other guaranteed compensation—among graduates who reported receiving each form of pay. The percentage of students who are minorities is based on U.S. citizens and permanent residents only, and includes African Americans, Asian Americans, Hispanic Americans, Native Americans, and other ethnicities.

Program costs are another complicated area. For executive MBA programs, total cost is simply tuition and all required fees. For part-time MBA programs, we list tuition per credit hour, as actual costs will depend on how many credits are taken each semester. For full-time MBA programs, we’ve calculated a total cost figure that includes tuition and fees, living expenses, and forgone salary for the entire length of the program. Annual living expenses are also broken out separately and include room and board and all other miscellaneous expenses (excluding tuition and fees) that a student is likely to incur.

Each profile also includes letter grades based on responses to individual questions (or groups of questions) in our ranking surveys. Since these grades represent only a fraction of the entire survey, it’s possible for highly ranked programs to have some poor grades and vice versa. In each category, the top 20% earned an A+, the next 25% received A’s, the next 35% were awarded B’s, and the bottom 20% got C’s. No D’s or F’s are awarded.

The Best MBA Articles from BusinessWeek and BusinessWeek.com

What’s an MBA Really Worth? (September 22, 2003)

Once the holy grail of business education, the MBA has become increasingly tarnished over the past two years. The credential that came of age in the late 1980s and early 1990s as business became the it profession has been taking its lumps right along with corporate America. Then, last year, Stanford University business professor Jeffrey Pfeffer turned up the volume. In a controversial paper, he argued that since there had never been a measure of the long-term value of the degree, there was no way to really know if a pricey B-school education was worthwhile.

Well, hold onto your hat, Professor Pfeffer. The Class of 1992 gives B-school a big thumbs up. In BusinessWeek’s exclusive survey of MBA alumni, nearly 1,500 alums of the Class of 1992 from our Top 30 B-schools report high levels of satisfaction with their careers and say they owe much of that success to their MBA experience.

Overwhelmingly, they say that earning the degree was worth it. Some 89% say that they would go for the MBA again if they had it to do over. And nearly 80% said that they would attend the same school. There’s no question that the MBA catapulted most of the class into the upper reaches of American society. Today, the members of the Class of 1992 earn an average salary of more than $155,200—up from the average $56,600 they earned in their first post-MBA job. Add in the $232,400 in average bonus and other compensation—buoyed partly by windfalls earned by alumni working in banking and finance—and compensation for the class last year was $387,600. Compare that to today’s average salary for a person with only a college degree—about $43,400—and the MBA premium comes into focus.

As a group, the Class of 1992 ended up in a truly commanding position. They’re loaded with management responsibilities—on average, they oversee 93 people each—and as a group they have started hundreds of companies that created nearly 100,000 jobs. Some 22% ended up in banking, 16% in technology, 15% in consumer goods or manufacturing, and 12% in consulting. On average, they’ve had three different post-MBA employers, along with four promotions, since graduation. And about 25% have switched fields since their first post-MBA job.

Across the board, alumni said that they had counted on the fabled alumni networks but had been largely disappointed. When it comes to advice, job leads, and lifelong connections, alumni gave their schools low marks. Even schools like Harvard and Stanford, tight-knit Dartmouth and Kellogg, and techno-giant MIT scored only slightly above the average. Looking back, many alumni saw their training as too grandiose—overly focused on being a CEO, rather than the more likely middle-manager role—and not practical enough to prepare them for tackling everyday problems. At a minimum, says one, I wish someone had told me this would be one of the biggest challenges, and then given me some tips.

—Jennifer Merritt

Is the MBA Overrated? (March 20, 2006)

In the executive pantheon, David K. Zwiener might be considered a minor god. As a graduate of No. 1–ranked Kellogg School of Management at Northwestern University, the executive vice president at Hartford Financial Services Group Inc. is one of 47,000 living alumni of one of the world’s most prestigious MBA programs. But he has an unusual distinction: in 2004, his $3.7 million pay package made him one of only three Kellogg MBAs among the 500 highest-paid executives in the Standard & Poor’s 100-stock index that year. It opens that first door for you, Zwiener says of MBAs in general, and his in particular. After that, it’s up to you.

Zwiener’s experience points to a little realized fact about the MBA: it gets you only so far. In fact, for those seeking a job at the very top of the corporate hierarchy, it’s not even a requirement. BusinessWeek research has found that fewer than one out of three executives who reach those lofty heights do so with the help of an MBA. And if you think a sheepskin from a top school is a necessity, think again. Only half of the executives with MBAs went to the top 10 schools in the 2004 BusinessWeek ranking.

Of the more than 250,000 living alumni of BusinessWeek’s top 10 MBA programs, only 71 made it into the ranks of the highest paid executives at S&P 100 companies.

BusinessWeek examined the five highest-paid executives at each of the S&P 100 companies in 2004, the most recent year for which data are available. We then tracked their educational credentials, obtaining information on 441. Finally, we calculated the pay for all 500 executives and combined those data with statistics about each school’s alumni base as well as company performance for 2002–2004. Some startling numbers came to light. Only 146 of the 500 executives reported having MBAs, a surprising number considering the hundreds of thousands of B-school alumni with enough experience to qualify them for top jobs. What’s more, only 71 received MBAs from top 10 B-schools, and two-thirds of those executives have degrees from just three institutions: Harvard Business School, Stanford University’s Graduate School of Business, and the University of Pennsylvania’s Wharton School.

Headhunters say that while an MBA may help someone land a first job after graduation, the career benefits from that moment on are almost nonexistent. In the pure Darwinian world we live in, pedigrees mean nothing, says Peter D. Crist, chairman of Crist Associates, a Hinsdale (Illinois) executive search firm. It’s instinct, it’s hard work, and it’s raw intelligence.

In such a world, a credential that makes people better managers should confer an evolutionary advantage. But BusinessWeek’s research calls that premise into question. An examination of company performance for 2002–2004 shows that outfits run by CEOs with MBAs do, in fact, have a modestly better return on equity than those run by non-MBAs. But median shareholder return for the MBA-run companies was significantly worse—7.4% versus 9.9% for outfits run by non-MBAs. Researchers at Pace University came to similar conclusions but went a step further. They examined the 2000–2002 performance of all companies listed on the New York Stock Exchange that were run by CEOs with U.S. undergraduate degrees and discovered that those with MBAs from top schools performed no better than those with less prestigious degrees. If you go to Harvard, you’re more likely to meet successful people who will enable you to do well, says Aron A. Gottesman, an associate finance professor at Pace. You’re not necessarily a better manager.

—Louis Lavelle

Can Your Relationship Survive B-School? (February 13, 2007)

There’s a reason the MBA has earned a reputation as the divorce degree.

B-school students are typically older than other professional degree seekers (27, on average), and a higher percentage