Harvard Business School (HBS) slipped to fifth place while the Wharton School at the University of Pennsylvania took top honors in Business Week's latest ranking of America's best business schools.

In 1996, the last time the magazine compiled its rankings, Harvard placed fourth. Wharton has been first three times in a row.

The business schools at Northwestern University and the Universities of Chicago and Michigan placed second, third and fourth respectively in this year's rankings, which were announced yesterday evening.

HBS Director of Communications Loretto Crane said of the rankings, "We're interested in any information that helps us evaluate how we are being perceived by our various constituencies, and these kinds of surveys are part of that mix."

A competing business school ranking, released earlier this year by U.S. News & World Report, paints a somewhat different picture. U.S. News placed HBS first, tied with Stanford. By contrast, Business-Week ranked Stanford ninth.

U.S. News uses a different, slightly more complex, methodology in its calculations, taking into account, for instance, selectivity and the opinions of school deans.

In recent years, some university administrators and student groups have questioned the validity of such classifications.

"Many factors go into a good business school," Crane said. "[Prospective] students still need to do their homework."

Current HBS students said they are quite interested in how their school places.

"In business, perception is key, so rankings do matter. Besides, we'd all like to be at the number one school," said one student.

Business Week calculates its rankings by surveying two important groups: business school graduates and corporate recruiters. For 1998, Harvard ranked sixth among recruiters but 13th among grads. Business programs at Columbia, Duke, Cornell, Stanford and Dartmouth round out Business Week's top 10.

The business school cover story will be at newsstands on Monday. More information about the rankings is currently available on Business Week's Web site, www.businessweek.com.