i would say another reason business schools (any university in general) love standardized tests is to improve marketability of the school. as much hard work you do to market yourself to the school, the school probably works 2-3 times has hard to prove to the world that it indeed is one of the top business schools in the world.
say, i had tons of money and i build this amazing state of the art facility with all the modern amenities you can possibly imagine and i say i am able to pay few Harvard, London, INSEAD educated faculties to come teach for me. if i don't prove to you somehow that your classmates are even more awesome than you, neither you will bother applying to my school, nor would recruiters would come to recruit. in fact, it is probably a harder sell to recruiters. especially when the market is so saturated with so many good schools.
so point is GMAT (and standardized tests) are necessary evil that's here to stay.