The average score in the GMAT is probably the most widely used measure of student quality. It is a useful tool for student selection because it is standardized — all applicants take the same test regardless of their undergraduate school. School admissions officers cannot be familiar with the grading standards and education quality of each college, and the GMAT "levels the playing field" and allows comparison of competing candidates.
Few schools, if any, have been able to demonstrate a significant correlation between GMAT scores and subsequent grades achieved in an MBA program. None have even attempted to show a correlation between the GMAT score and the likelihood of becoming a successful business executive. Some literature suggests a correlation between standardized test scores and I.Q., which suggests that there may be some minimum score necessary for a student to complete a rigorous academic program successfully. If so, that threshold may be different for each school.
GMAT averages generally range from a high of 625-650 at the most selective schools to a low of 450 at the less selective schools. Small differences between schools are probably not significant, and the range of GMAT scores at any school is usually a wide spread from the average.
Schools whose students have high average GMAT scores are placed in a higher rank.