BUSI­NESS Ed­u­ca­tion is A kind of CASH Cow

Industry Leaders - - Cover Story -

Crit­ics of mod­ern busi­ness ed­u­ca­tion have ve­he­ment com­plaints. For in­stance, the chief ex­ec­u­tives of the Big Five are card-car­ry­ing M.B.A.’S. In re­cent years, top busi­ness schools have shipped more than 40 per­cent of grad­u­ates in to the world of fi­nance. But, with the econ­omy in dis­ar­ray since 2008, and so many fi­nan­cial firms in the free falls, many ed­u­ca­tors and an­a­lysts are won­der­ing if it is the way busi­ness stu­dents are taught may have con­trib­uted to the most se­ri­ous eco­nomic cri­sis of the cen­tury.

Busi­ness school to­day have be­come, in many way, sci­en­tific and too de­tached from real world prob­lems. Busi­ness grads are given a lim­ited and dis­torted view of their role – they grad­u­ate with a sharp fo­cus on max­i­miz­ing share­holder value and only a lim­ited un­der­stand­ing of eth­i­cal and so­cial con­sid­er­a­tion es­sen­tial to lead­er­ship. Many of these short­com­ings have left high-rank­ing ex­ec­u­tives in­ad­e­quately pre­pared to make de­ci­sions that might have helped mit­i­gate the fi­nan­cial tur­moil.

As a mat­ter of fact, em­ploy­ers and head­hunters also ques­tion the value of a man­age­ment de­gree. What’s the point of a grad­u­ate de­gree if at the end of the day busi­ness schools are only mint­ing morally de­tached, sin­gle­minded for­tune seek­ers.

Back in 1950s, a study com­mis­sioned by the Ford and Carnegie Foun­da­tions noted that medi­ocre fac­ulty and cur­ricu­lum which nar­rowly fo­cused on vo­ca­tional skills has greatly added to the im­bal­ances on cam­puses and in the econ­omy.

In some of the top busi­ness schools, changes are un­der way in cour­ses and cur­ricu­lums. Busi­ness grad­u­ates are taught to be long-term eco­nomic stew­ards rather than agents who max­i­mize the share­holder wealth.

Yet, em­ploy­ers are ques­tion­ing the value of an M.B.A de­gree. A re­search project by two Har­vard pro­fes­sors pub­lished in 2008 found that em­ploy­ers val­ued busi­ness grad­u­ates’ abil­ity to think through in­tri­cate busi­ness prob­lems. And so, a grow­ing num­ber of busi­ness schools are now find­ing valu­able lessons from the eco­nomic cri­sis. As a mat­ter of fact, big schools like Har­vard Busi­ness School and The Whar­ton Busi­ness School are now con­sid­er­ing to make their cour­ses more global and put more em­pha­sis on lead­er­ship skills. More so, Har­vard is even as­sem­bling cases based on the events of the last decade, in­clud­ing is­sues in­volv­ing ac­count­ing prac­tices, for in­stance, the Jpmor­gan Chase’s ac­qui­si­tion of Bear Stearns.

In the year 2006, Yale School of Man­age­ment in­tro­duced cases based on the fi­nan­cial cri­sis on their cur­ricu­lum to of­fer in­ter­dis­ci­pli­nary per­spec­tives on com­plex prob­lems.

The Aspen In­sti­tute, mean­while, has de­vel­oped a cur­ricu­lum in con­junc­tion with the Yale School of Man­age­ment that is aimed

at teach­ing stu­dents how to act upon their val­ues at work. About 55 busi­ness schools, in­clud­ing Stan­ford, North­west­ern and MIT are us­ing a part of it in pi­lot pro­grams. Mov­ing along, the Aspen In­sti­tute also pro­duces an an­nual re­port rank­ing busi­ness school on how well they in­te­grate so­cial and en­vi­ron­men­tal is­sues into cur­ricu­lums.

At the Stern School of Busi­ness of New York Univer­sity, pro­fes­sors re­cently wrote pa­pers an­a­lyz­ing the eco­nomic cri­sis and of­fer­ing pol­icy rec­om­men­da­tions that have been now com­bined in a book.

Man­age­ment is a pro­fes­sion much like law or medicine. Ac­coun­tants, doc­tors and lawyers are not im­mune to wrong­do­ing or poor judge­ment, and they have long been tak­ing cer­ti­fi­ca­tion ex­ams and promis­ing to act eth­i­cally.

It re­quires a code of con­duct as well as con­tin­u­ing ed­u­ca­tion. Some of the best known busi­ness schools world­wide now pro­mote stan­dards for sus­tain­able busi­ness prac­tices, with a re­newed fo­cus on the so­cial value of man­age­ment.

To­day, busi­ness schools face in­tense crit­i­cisms from stu­dents, em­ploy­ers, and even the me­dia for fail­ing to in­still norms of eth­i­cal be­hav­ior. Deans of some of Amer­ica’s most pres­ti­gious busi­ness schools agree that the main cul­prit is the lessthan-rel­e­vant MBA cur­ricu­lum.

In the re­cent decades,

lead­ing B schools have adopted a model of sci­ence that uses sta­tis­ti­cal mul­ti­ple re­gres­sions, lab­o­ra­tory psy­chol­ogy and ab­stract eco­nomic anal­y­sis. Busi­ness is not an aca­demic dis­ci­pline like ge­ol­ogy or lit­er­a­ture. It’s a pro­fes­sion, sim­i­lar to medicine and the law, and busi­ness schools are pro­fes­sional schools. Like other pro­fes­sions, busi­ness calls upon the work of mul­ti­ple aca­demic dis­ci­plines. For busi­ness, they in­clude psy­chol­ogy, phi­los­o­phy, so­ci­ol­ogy, math­e­mat­ics and eco­nomics.

Busi­ness ed­u­ca­tion has evo­lu­tion to a very gen­er­ous ex­tent in the last hun­dred years. His­tor­i­cally, busi­ness schools have em­pha­sized on ed­u­cat­ing prac­ti­tion­ers and im­part­ing knowl­edge through re­search. Re­mem­ber, when MIT’S Sloan School of Man­age­ment was known as MIT School of In­dus­trial Man­age­ment and its pro­duc­tion class was taught by the man­ager of a nearby Gen­eral Mo­tors assem­bly plant.

In the boom­ing post­war econ­omy, nearly all of the na­tion’s elite Mba-grant­ing in­sti­tu­tions be­gan to treat their schools al­most as se­ri­ously as law schools. How­ever, in the process, their fo­cus switched, and now most B schools use the sci­en­tific ap­proach.

By al­low­ing the sci­en­tific re­search model to thrive, busi­ness schools are now driv­ing out all other mod­els. Deans say they re­ward prac­ti­tioner-ori­ented re­search, and yet their schools re­wards sci­en­tific re­search

de­signed to please aca­demics. By pro­mot­ing in­di­vid­u­als who pub­lish in dis­ci­pline-based jour­nals, B schools are set­ting an ex­am­ple that it is okay to be a pro­fes­sor of man­age­ment and never have set foot in­side a real busi­ness. To­day’s pro­fes­sors know more about aca­demic pub­lish­ing than about the prob­lems of the work­place. For in­stance, busi­ness grad­u­ates are made to study case stud­ies, which makes it an in­te­gral part of the ed­u­ca­tional process.

The most elite B schools are the most in­tel­lec­tu­ally ex­cit­ing places in academia. Yet, the loss ex­tends far be­yond the tra­di­tional class­rooms. Em­ploy­ers are notic­ing that freshly minted MBA, even from the most pres­ti­gious B schools, lack skills their or­ga­ni­za­tion needs. Why can’t B schools op­er­ate ven­tures that func­tion like the equiv­a­lent of a law-school teach­ing law firm? Per­haps, the rea­son is that cor­po­ra­tions hire MBA with nar­row spe­cial­i­ties. They sup­port B school, do­nate money in mil­lions and not de­mand enough that the in­sti­tu­tions pur­port to sup­port their needs. This is ironic.

Aris­to­tle taught that lead­er­ship con­sisted in the abil­ity to iden­tify and serve the com­mon good. This re­quires an ed­u­ca­tion in moral rea­son­ing, which in­cludes logic, phi­los­o­phy, lit­er­a­ture, the­ol­ogy, and his­tory. B school’s lack of of­fer­ings in hu­man­i­ties is a se­ri­ous draw­backs. Why have B schools aban­doned other forms of knowl­edge?

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.