Leaders playing the rankings game risk getting seduced by the ranking itself and not what it is actually measuring.
Because reputation rankings provide a third-party endorsement they can be a powerful validation of an organization. It is therefore not unusual for organizations to have as a goal improving their place on a reputation ranking.
However, this is a dangerous way to think as it trivializes how reputation is earned. The axiom that it takes time to build reputation but only a moment to lose it is true.
But what it takes to move an organization even one or two places on a reputation ranking can be daunting.
Further, the rankings released through the media (the beauty contests) only give a glimpse of how some people view an organization.
Rankings out of control
A classic example of rankings that may seem out of control are those done for business schools. Many of the rankings of business schools are carried out by publications such as Forbes, Financial Times, US World and News Report, Bloomberg Businessweek, Business Insider, and The Economist, to name a few.
They have become important because students look to rankings to help them select where they want to study. The problem is knowing what precisely each of the rankings measure and who is asked to rate the different schools.
For example, the Financial Times ranking of business schools is a sought after list, including by BI and NHH, whose scores on the ranking are presented every year in the media.
Schools ranked high on this list use considerable resources advertising their rankings externally but also use resources internally for encouraging faculty to heed the rankings in their production of publications.
What do rankings measure?
However, an inspection of what is evaluated on the FT rankings shows that what they measure has very little if anything to say about the quality of a school.
Approximately 40% of the evaluation for achieving a high rank is on salaries of the schools’ graduates and only 10 percent on the research rank of the school. Schools whose students have higher salaries have a distinct advantage and this is a variable that a school has very little control over.
If BI wanted to move up on the ranking, where should they put their reputation-building efforts?
The answer is getting their students employed rapidly at jobs with high salaries. The Financial Times ranking of BI’s master in finance shows that BI graduates earn nearly one-half of what graduates from a similar master’s at St. Gallen’s earn. The issue is not only that this gap is impossible to close, but if this is a valid measurement of educational quality.
Playing the game
Chasing rankings also influences how employees view their own institutions. Performance on these types of rankings may call into question employees’ perceptions of highly valued, core identity attributes of their organizations, and they challenge employees’ beliefs about their school’s standing relative to other schools.
In other words, employees start wondering if what they are doing has any value or if their own institutions are somehow not who they really say they are. As noted by Delvinney et al. (2007: 21):
“There are opportunity costs associated with playing the rankings game if these costs could be more productively spent on other marketing activities … If money is spent on managing to the reputation criteria as measured by, say, the Financial Times instead of the choice criteria used by potential students (and faculty and patrons), then money and effort is misallocated.”
Adapting to he image, losing sight of substance
However, as one UK university says, “Our ranking increases our reputation and our reputation increases our ranking”.
As long as this logic prevails, it is easy to see how leaders get caught up in the ranking itself and not what it is actually measuring.
Organizations begin to adapt to the image and lose sight of the substance; when image should be used to enhance substance.
As the business school rankings illustrate, the attributes say nothing about the real quality of the education. But it is imperative to be on the ranking as not being on it sends a message that the school is not good enough to even make the list.
Gioia and Corley compare this conundrum to a Circe-like transformation; schools benefit from the lists but their spell is addictive. And as pointed out by these researchers, business schools have pretty well done it to themselves.
Other organizations should heed these warnings and not be blinded by the seeming charms of reputation rankings with no substance.
- Devinney, T., Dowling, G.R. og N. Perm‐Ajchariyawong, 2008: The Financial Times business schools ranking: What quality is this signal of quality?. European Management Review, 5(4), s.195-208.
- Elsbach, K.D. og R. M. Kramer 1996: Members' responses to organizational identity threats: Encountering and countering the Business Week rankings. Administrative science quarterly, pp.442-476.
- Gioia, D., & Corley, K. G. 2002. Being good versus looking good: Business school rankings and the Circean transformation from substance to image. Academy of Management Learning and Education, 1: 107 120.
- This article was first published in Communication for Leaders 2019. Communication for Leaders is a Science Communication Magazine published by the Centre for Corporate Communication and the Department of Communication and Culture at BI Norwegian Business School.
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Text: Professor Peggy Simcic Brønn, Department of Communication and Culture at BI Norwegian Business School.