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The Future of B-Schools

The Future of B-School section  includes:

Integrative learning and 21st Century education:  it’s about more than B-School curriculums. Competitiveness and ducation in a global economy
July 2006

Jim de Wilde
August 2005


Globalization and the development of B-School curriculums   August 20, 2005

Integrative learning and 21st Century education:  it's about more than B-School curriculums   

Competitiveness and education in a global economy


July 2006


Jim de Wilde


INTRODUCTION:    The end of credentialism and the beginning of the age of collaborative judgment  


            B-Schools are not alone in their attempt to provide relevant, rigorous education in a post-Wikipedia age.  The organization of knowledge in an information-saturated open source age and the development of curriculums that are appropriate to meeting the challenge of the 21st Century remains a top priority both for educators and for public policy makers.    We are now in an era of intellectual property-led growth or knowledge-based industries or an information economy.   Whichever buzzword we choose to use, the issue remains that educational policy and competitiveness agendas have merged.  The competitive advantage of the Finnish or Canadian economies   comes from the current capacity of the traditional western economies to organize knowledge, commercialize new ideas, and create value-added information and educated citizens.  As Asian science and technology becomes creative as opposed to imitative, the nature of global leadership in business will change.   


            The realization that this model is under challenge has gradually worked its way into public policy discussions in Canada and North America in the last few years.   There seem to be some trends emerging and they affect the curriculum that the world's leading knowledge centres will develop.   This has real implications for the way leading B-Schools and educational centres will themselves innovate.   It is commonplace today to say that the next generation of global leadership will be technology-literate and will understand intuitively, for example, the ways social networking creates new social policy operational models.   It is increasingly commonplace in Europe and Canada to say that the next generation of global leadership will understand intuitively the intercultural dynamics and the impact of centuries of globalization affect our strategies and decisions.  For example, it will never be possible again for a major world figure not to know the difference between Shia and Sunni Islam.  Five years ago, that was not a criterion of qualities.   The historical amnesia inherent in social models has ended. 


            The challenge for professional educators is to create curriculums and educational instruments which facilitate this kind of leadership and disseminate these skills as widely as possible.    In an information-saturated age, the generation of more data is less important than the skills required analyzing it.   In moving beyond an era of narrowly-focused specialized credentialism, educators need to create programmes and techniques which facilitate the development of skills required for 21st Century leadership.   It is in this context which skilful innovative ideas like Integrative Thinking at Rotman have emerged.   These remarks are intended to reflect on the state of B-Schools in Canada and globally as we start the 2006-7 academic year.   I will start with some general observations on the globalization of knowledge:


            First, it is clear that China, India and Japan are developing a capacity to innovate scientifically.   There are now concentrations of expertise in Asia which match the creativity in science and cultural industries that we have long associated with North America and Europe.  They create different models of validation.  Chinese and Indian herbal medicine are   empirical traditions based on centuries of experimentation. 


            Second, Chinese and Indian knowledge is less concerned with credentialism and more concerned with relevance.   One has to be cautious about predictions.  In preparing these remarks, I looked at some of    the debate on competitive advantage of Japan   in the late 1980s.  The discussion then was premature, accurately understanding new Japanese trends (film animation, consumer product engineering for example), but dramatically underestimating the capacity for Japanese capital markets to manage open innovation, and missing "disruptive technologies" like the internet and satellite communications and the impact that they would have on the Japanese model of technological innovation.   Nevertheless, those predictions, extreme as they were in some quarters were accurate about the global automotive industry and the global consumer technology products industry.


            Third, as knowledge globalizes in an open source world,   it is clear that the ability to use knowledge creatively and innovatively remains the source of competitive advantage.  Only in an open society can knowledge be disseminated rapidly, corrections be made quickly and new ideas be disseminated thorough social conductors.   These are difficult preconditions to invent through public policy.   They emerge from cultures and explain geographical centers of innovation.   The Korean film industry, the Taiwanese music industry and the Japanese anime industry are all clear examples of creative industries.   The question is whether they will affect the creative patterns that exist in North American and European societies.


            What we do know is that we need new ways to organize knowledge.    Research is less important in an age where a first-year medical student can theoretically be as up-to-speed on research on pancreatic cancer as someone who has spent ten years researching the issue.   The skills we need are different now and the disconnect between the demands of the consumers of educational products and the organizational of traditional university-based learning reflect this yearning for different skills and capacities.


            It is in this spirit that we have developed new approaches to learning, the demand for commoditized courseware which avoids the need for a thousand first year physics courses to reinvent wheels.   It is in this spirit that students from Asia have developed a smorgasbord approach to education, picking things off the table as they "visit" Stanford or McGill, rather than purchasing the pre-set menu.   It is in this spirit that the North American career market has discouraged narrowly-specialized skills-sets in exchange for the mixture of judgment, analytical capabilities and creative qualities which were; ironically, at one level the hallmark of a traditional elite education in an Oxbridge tradition.


            B-Schools have taken the lead in producing the kind of education required in a post-internet world.   In part, this came about because of the triumph of market-based policy analysis in the 1990s and the capacity of B-Schools to be the nucleus of the invention of new business models.   But in equal part, this was because B-Schools had a unique positional good:  they were the only place where students collaborated with differentiated backgrounds.   An MBA programme had physicists, art historians, macroeconomists and chemical engineers all seeking a particular set of skills and values.   This turned out to be what educational consumers wanted, even if they had no interest in a career in business per se.     However, B-Schools within a North American university model inevitably succumbed to the temptation to reward specialized research and we ended up back where we started from.         B-Schools need to rescue education from specialization in an era where the practical "integrated" judgment of experiential knowledge needs to be distilled and transmitted as efficiently as possible if as a society, we are to maintain a competitive advantage based on our capacity to innovate.


            It is in this context that the Rotman adventure in Integrated Thinking offers a chance to reassess curriculums and educational needs.   In our current organization of knowledge,  B-Schools remain the one place where a student of the IMF can work with someone who has worked on emerging markets portfolio strategy at an investment bank and see how their paradigms combine in collaborative work.   The ability to do this and do more of this will differentiate the most successful economies from poorer performers in this new era of globalized open source knowledge.   It is in this spirit that I offer some observations about how this can be arranged in a curriculum that combines rigorous analysis and integrated thinking.





Integrative thinking is more than turbo-charged interdisciplinary research





            In many conversations, students starting for college ask about a "relevant" curriculum.    In a parallel universe business conversations begin with finding the research skills necessary to solve particular problems: from the causes of particular viral infections to the question of what Thailand's GDP grows and Ethiopia's doesn't (neither was colonized). 


            In the focus on learning societies which is now part of the agenda of competitiveness, there are many currents of thought competing for the attention of public policy makers.   We all want an educated society.  The question is not only how we get there, but what "educated" means.  


            In professional evaluations, we all use shorthand:  "book smart, but no street smarts".  In analyzing public policy situations we quickly detect the conflicts between sociologies of knowledge:  Arabist historians who understood the clan culture of Sunni Iraq versus "strategic" thinkers who thought they understood geopolitical trends.


            The many currents which exist in educational circles contain those who want to see rigour developed, a Jesuitical model of learning which then leads a trained mind

through the jungles of accumulated data versus those who want a broader education where a subtle cultured mind is prepared to understand the world.  This current rewards discipline, whether the discipline is of writing a dissertation on Spanish poetry during the Renaissance or on the ecological problems of Costa Rican rain forests.


            One current rejects credentialism as leading people down narrow paths and this current has given rise to some useful forms of interdisciplinary thought. 


            Educators are preparing for this complex world.   Some of the best thinking about education is going on in business schools, fore example the Rotman approach to integrative thinking.   At one level, integrative thinking takes place when intellectual cross-fertilization and creativity occurs.   A lunch between a top quality environmental chemist, a food scientist and a public policy specialist on land-use can create a number of useful ideas.  As most institutions lack the framework to make this lunch happen, the institution which deems its competitive advantage as creating a culture in which this lunch is "ordinary" and "expected" achieves a status of leadership in educational circles.   


            Interdisciplinary programs and products are highly valuable, but they are only the starting point for a new approach to education.  There needs to be more than this, and not just in business schools, but in the search for better models of education in all undergraduate areas of learning.



With this in mind, one starts to address in an internet age where Wikipedia makes information a very easily obtained commodity,  what it is that one would like the most dynamic and effective business decision-makers  to have as acquired personal software and how we can most efficiently facilitate their acquiring those skills.     I would start an approach at new models of thinking with three books:      


John Allen Paulos' Innumeracy , which requires non mathematical students to be consumers of mathematical knowledge and demonstrates the dangers of limited mathematical understanding in the calculation of risk. Innumeracy leads to bad decision-making.   By exaggerating certain risks, I allocated resources inefficiently;


            Peter Huber's Galileo's Revenge (philosophy of science, sociology of knowledge) which shows the importance of the sociology of knowledge in understanding claims about scientific "accuracy".     The understanding of how scientific norms change returns us to the best judgments we can make.    Scientific illiteracy goes many ways.     Most undergraduates today know the Brad Pitt (as character Jeffrey Goines) monologue in Twelve Monkeys:


Jeffrey Goines: Uh-huh. Eighteenth century, no such thing, nada, nothing. No one ever imagined such a thing. No sane person. Along comes this doctor, uh, Semmelweis, Semmelweis. Semmelweis comes along. He's trying to convince people, other doctors mainly, that's there's these teeny tiny invisible bad things called germs that get into your body and make you sick. He's trying to get doctors to wash their hands. What is this guy? Crazy? Teeny, tiny, invisible? What do they call it? Uh-uh, germs? Huh? What? Now, up to the 20th century, last week, as a matter of fact, before I got dragged into this hellhole. I go in to order a burger at this fast food joint, and the guy drops it on the floor. James, he picks it up, he wipes it off, he hands it to me like it's all OK. "What about the germs?" I say. He says, "I don't believe in germs. Germs is a plot made up so they could sell disinfectants and soaps." Now he's crazy, right?


Stephen Levitt's Freakonomics .   The University of Chicago economist's book is an interesting attempt to broaden the appeal of a very innovative approach to asking significant questions without pre-selecting the manner in which they should be answered, a good definition of "integrative learning"?


            But what are the skills the successful decision-makers of the future need to learn and how do they learn as they read these books and analyze the contemporary world where scientific knowledge and strategic decision-making seamlessly intersect?    


            Management educators should want to create business versions of Ang Lee, a director who can manage creative artists, technological skills, and create a film.   The most successful CEOs are likely to be film directors or symphony conductors in the future.   The skills they need are to:


(a)    to be numerate and scientifically literate in analyzing the decisions they have to make;

(b)   to manage interdisciplinary knowledge rigorously;

(c)    to be able to manage functionally different teams (cinematographers and special effects computer software designers);

(d)   to be able to understand the logic of a discipline (e.g. environmental chemistry,   immunology) without developing an expertise in it ;

(e)    to know how to put together "Mission: Impossible" teams.    By this I mean combining different skill-sets and knowledge-bases for different tasks, the way the team was assembled at the beginning of the original TV show.  This skill-set is the equivalent of the social and interviewing skills required for making the "lunch" between specialists productive;

(f)      to understand how incentives structures can influence outcomes and reviseeconomic theory to be much more empirical and less driven by abstract mathematical theories           



            Much of this is the responsibility of the student, who is ultimately the agent of integration.    The reason we consider some individuals to be "excellent" and others "competent" is in significant part because of their capacity to integrate.  At one level, integrative learning is a synonym for pursuing excellence.     At one level, the student following David Brooks' superb New York Times column of March 2nd in developing a formula for a culturally-enriched and disciplined mind  (learn a foreign language to understand how other people think,  read Plato, take statistics,  travel) .    


             My overused advice to younger family and friends that there are three intellectual disciplines one must master before accumulating data: philosophy of history, philosophy of science and sociology of knowledge is annoying and possibly unhelpful because most curriculums are not organized that way.    But understanding how Braveheart changed interpretations of Scottish history, understanding how detective work on new forms of virology van be organized, and understanding why we stuffy some things more than others equips an undergraduate with a cast of mind which enables them to make decisions about larger issues (which research grant should be funded,  whether or not there is a rational ground for military intervention in Somalia,  which course of treatment to use for the pancreatic cancer we have just diagnosed).  Great educators teach people how to learn, great educations tell people what to think about, not what to think.


PART TWO    A Curriculum for Thinking About How We Organize Knowledge          



            How do we teach this 21st Century approach to a subtle and trained mind?  One of the great competitive advantages of B-Schools is the heritage of case method education.  If we take five topical articles from recent business publications and treat them as cases, we can begin a discussion on integrative learning and the skills required.


            Let us start with five case studies, the teaching of which could illustrate the skills discussed above.   These are from a collection of case studies I am collecting of important topics which would be difficult to research within transitional academic disciplines.  This constraint has not stopped the assignment editor of the Financial Times, New York Times, Business Week or Wall Street Journal:



(i) A very important cover story in Business Week is entitled "Medical    Guesswork: From Heart Surgery to Prostate Care, the medical industry knows little about which treatments really work".   It is a very useful piece, but one other question it raises is "where can I go to study this?"   The need for "thinking  outside of silos" or "putting together mixed skills while still having intellectual  rigour" has challenged universities for two decades or more.


            (ii)  The investigation of business strategies if beverage companies dealing with   the medical issues of enhanced stimulative products:  Melanie Warner   "A Jolt of Caffeine, By the Can", New York Times, November 23, 2005:  an analysis of the   business strategies of major beverage producers, the competitive marketplace forthe Red Bull, Mountain Dew product sector, the implications of caffeine-additives  in health policy discussion (regulation in France, Denmark, Argentina and  Norway), implications for health advertising, and analysis of behavioral      biologists, experimental psychologists and marketing strategists.   The underlying    implications of the role of regulation in assessing nutritional standards, the role of  additives and stimulants in non-regulated food and beverage are all discussed in an excellent case study.  Another Melanie Warner piece on "what is an organic food?" shows another development of the new integrated learning of business strategy, consumer behaviour, public health issues, measurement of drugs and  additives to health,  nutrigenetics, proteonomics and a range of cost-benefit analyses.



(iii)  Peter Fritsch's November 2, 2005 Wall Street Journal article on "After the Tsunami" shows how the work done on creating democratic frameworks in Indonesia led to a different kind of distribution system.    It creates an analysis which is a synthesis of political economy, organizational design, logistics and behavioral incentives.   It would be difficult to do this work within the intellectual boundaries of a political science department.  The absence of sustained research of this quality shows up in the skill-sets of those well-intentioned practitioners of development assistance.


(iv)  Roger Thurow's October 26, 2005 Wall Street Journal piece on "Farmers, Charities Join Forces To Block Famine-Relief Revamp" represents some of the best analysis applied work   on the management of famine relief and the operationalization of key management skills.   It is based on agricultural economics, organizational design, behavioral incentives, and political economy and reflects a similar integrative approach to a major question.


(v)     Scott Hensley's   November 8, 2005 Wall Street Journal article "As Industry Profits Elsewhere, U.S. Lacks Vaccines, Antibiotics"  on the allocation of U.S. drug research to areas other than vaccines and antibiotics represents a similar type of innovative investigative journalism.     It requires an analysis of sociology of medicine, epidemiology, pharmacology, economics of innovation and public policy decision-making.  




All these questions require an integrated answer.   All of these articles require a decision-maker reading them to interpret competing claims about valid knowledge in scientific areas, or conventional thinking about the organization of resources in contemporary societies.    To act effectively on these issues: (e.g. a management team for famine relief, an investment team for effective health-care management) requires managing interdisciplinary "Mission: Impossible" teams.


   B-Schools alone in the academic structure have always had to deal with teaching engineers and PhDs in ocean physics in the same MBA class.  By focusing on real problems as the market generates them, B-Schools at their best have enabled managers and decision-makers to think in integrative terms.    As we look at curriculums for the education of the next generation of leaders, we need to know how integrative thinking, which some have defined as "interdisciplinary research with rigour" can be organized.



PART THREE   Learning from these case studies and case research in integrative thinking


This new journalism is "integrative", in the sense that it seeks to   analyze situations as opposed to operating within the narrow parameters of a specific "scientific" discipline.   Fritsch's work could only be done with a mixture of operational management, political economy and organizational design.   Thurow's piece is a mixture of organizational sociology, political economy and strategic management.   Hensley's work is a mixture of epidemiology, sociology of medicine, diagnostic medicine, medical economics and pharmacology.    Some of the most interesting new research work is being done in new disciplines, applied entomology, industrial ecology, and envirotoxicology. Interdisciplinary work is only one aspect of integrative thinking, but it does set the stage for the type of skills-development we are currently discussing.  


The nature of knowledge in the modern world means that specialization without contextualization leads to work of limited applicable value.      For research in business and in all areas, we need to ask what it is that needs to be integrated and how this research needs to be designed.    If you ask certain questions:  "how do we label products to accurately reflect food safety issues?"  or "how do we understanding the organizational dynamics of famine relief?" it is clear that we are asking for a very different approach to the design of "research" than the one which takes place in the overly-specialized world on modern North American universities.    While there will always be some research which requires enormous focus and specialization, the antidote to the trends which have limited academic research        is found on the approaches of the best journalism, where it has been kept alive for the past couple of decades.


            This reality means that the archives of the major world newspapers, like Financial Times, the Wall Street Journal, the New York Times and Business Week, have  become the library for the new educational institutions.    It is impossible to design a curriculum on relevant modern issues from academic sources alone and this transformation of the economics of education has significant implications for the commercialization of the kind of integrative thinking which is taken for granted when it appears in analyses like those of Business Week, Thurow, Fritsch, Henley and Warner used as examples above.



            As North American and European universities attempt to restructure around new disciplines and needs, the demand for innovative models of learning and teaching becomes greater than ever.   "Integrative thinking" is the best first cut at a restructured curriculum which will accentuate our capacity for creative and innovative thinking in the global economy.     The world of business education and practical undergraduate education requires both rigour and a breadth if perspective.   It may well be that a significant part of the best curriculums  will include a revival of old-fashioned concepts like an emphasis on  the  philosophy of science, philosophy of history and sociology of knowledge  as means to acquire rigour.   Having done that, we can teach students to do research around practical problems through case studies. 


The capacity to teach integrative projects rigorously    will help differentiate the superstar educational institutions of the future.   A curriculum which requires that students acquire the skills to answer important questions should be the centerpiece of any blue chip learning institution, whether B-School of undergraduate.   It is a post-Wikipedia approach to research.   A sample outline includes questions like the ones raise above by world-class "journalists".


1.                            How do we assess the effectiveness of medical treatments?  What criteria are relevant for future allocation of effort in research and allocation of resources in clinical treatment?

2.                            What are the lessons learned from the Aceh famine relief about managerial requirements in organizing widespread disaster relief?

3.                            What lessons for agricultural science and agricultural economics can we derive from a study of the politics of famine relief?

4.                            How do we assess the health impact of nutritional supplements and integrate this into the ethical marketing of food and beverages?

5.                            How do we organize medical research and the production of pharmaceutical products to meet anticipated demands within the current health-care system?


Or new questions:

1.                            How do we best assess the risk of bird flu relative to other medical dangers?

2.                            How do we measure and devise standards for measuring the acceptable level of toxigens in drinking water?  


These are the type of new questions which can only be usefully framed within a language of rigorous new disciplines.      The post-open source university of the 21st Century is a fundamental component of defining competitive position in a global economy.       This means that incentives have to be created for universities to participate in collaborative knowledge rather than in areas of peer-reviewed narrowcast research.    The problems of how to revitalize urban cores require an integrative approach, linking urban geographers, industrial ecologists, water purification engineers, exterior design landscape architects, demographers.   It is increasingly difficult for important questions to be answered by specialized researchers and yet we continue to make the PhD the only way research can be done in the publicly-financed universities and continue to look at peer-reviewed research as the major criterion for promotion and recognition.    



In each of these cases we need to be asking:


(a)   What disciplines does the decision-maker  need for our "Mission: Impossible" team dealing with a specific issue?  The ability to think broadly and then make this kind of assessment requires an understanding of the menu of expertise available.


(b)   How does a decision-maker assess the skills and competences within these specializations? 


(c)   How does the educator  create a transferable body of knowledge resulting from the collaboration between these teams?


(d)   How does the decision-maker assess the scientific risk and political risk of questions like food additive regulation which are at the intersection of so many contemporary public policy and business strategy issues?


By working back from key questions, the best curriculums of the future will develop a rigorous integrating skill-set.   That's what will be demanded of the highest quality business decision-makers in the 21st Century.




Back to Top


Jim de Wilde 

Remarks prepared for the MBA class of 2007

August 2005


            B-Schools have been at the heart of innovation-led growth for more than two decades.  They have created a network for commercialization of new products, an idea incubation factory for practical knowledge, and a renewable stream of practically-oriented decision-makers who have internalized a problem-solving approach to knowledge.    It is impossible to imagineSilicon Valley and the technology-led boom of the 1990s without the role of Stanford Business School in transposing the language of technology into the language of business.      

            B-Schools in the last three decades have also become one of the great innovations in modern education.  Great B-Schools have become  a cornerstone of economic growth activities in the entrepreneurial economy, helping to commercialize the intellectual property of engineering schools and create a "new" economy in the process.   They professionalize business learning and crystallize understanding of "best practices" in a range of activities from organizational psychology to strategic investment in emerging capital markets.  

            B-Schools have created the idea-rich networks within which global innovation can take place, given a common lanaguage to strategic consulting firms, venture capital firms and entrepreneurial new technology companies.  The best B-Schools continue to   provide an environment in which new   business models can be tested.  They continue to innovate in the organizational design of companies.  They are a zone where people can discover (and invent) the next wave of investment opportunities,   compare the demonstrated best practices in all the areas of economic performance (from human resource management to venture capital portfolio performance).     Perhaps even more importantly, the best B-Schools have become places where people can build the networks and teams that can create value and improve the efficient allocation of capital within the global economy.   They distill the learned experience of practical decision-makers, reflect on these decisions and add value from a variety of different perspectives. 

            So why have there been so many recent articles and commentaries about the "decline" of B-Schools?   


            B-Schools in context - from the 1980s to the present day

            The political importance of the global B-School network is in significant part that it has provided an intellectual framework within which globalization can take place, global leadership teams can be built and the best practices of economic growth strategies can be adapted from one context to another.  At their best, they have provided a framework in which practical problem-solving can be applied to a range of significant issues.   At minimum, they also have developed the organizational capacity to create new integrated disciplines appropriate to examining, analysis and addressing many issues which go far beyond the commonly understood definition of "business".    They have created  value systems predicated on the search for the efficient allocation of resources  and a conceptual approach to underlying issues of wealth-creation that have given relevance to "economics" and "economic research".   In the sociology of education, there is no other organization   mandated or positioned to do this.  

            In Canada, some of us have advocated at least the rhetorical target of aimin to have five of the top twenty-five business schools in the global rankings be Canadian. Like all dramatic mission-statements, this is meant to serve as an exercise in focusing.   All educational strategies need  to be renewed to take advantage of the opportunities presented by the world of internet economy and the competitive advantage which comes from the efficient commercialization of knowledge.    Canadians increasingly understand that our current prosperity is linked to rising oil and mineral prices.   The rise of oil and mineral prices provides Canadian decision-makers with a window in which to develop an economy that is also based on innovation and commercialization.  This cannot happen without the unique organizational role of B-Schools.   So why is there so much concern about the state of B-Schools and their current role?  

            Concerns about the continuing relevance of B-Schools 


             In part, B-Schools have become victims of their success.   MBAs    were correctly seen in the 1990s to be at the forefront of the development of new business models.    Some of these models worked dramatically, and contributed to the creation of companies like Yahoo and EBay.   MBAs were also at the epicenter of a disciplined market-based approach to economic development (in Latin America and the EBRD-zone).  Where these "models" were fused with political skills, they created enormous value and produced some of the most successful strategies for economic growth in the late 20th Century.  But that was in the last century. 

            There is no doubt that the promotion of a business culture of ethics, value-creation and community-building, while well-known to devotees of Warren Buffett,  was out of favor in the climate of hyperactivity which was in vogue by the late 1990s.    The simple business propositions that were known to a great number of people without MBAs were not being sufficiently emphasized in B-School classes.  That should be and is being corrected, but B-Schools lost their momentum and are now struggling to develop the product for the next phase.    

            B-Schools became stereotyped as a place where quantitative theories replaced sound business judgment and, in fairness, many left themselves vulnerable to this stereotyping.   In this manner, they became associated with the excesses of the 1990s.  Sumantra Ghoshal wrote a widely-read and cited piece in the Financial Times in 2003 entitled "Business Schools Share the Blame for Enron"  .    B-Schools also were seen as the arena in which arguments for globalization were honed.   This had negative connotations as market-driven globalization failed to address the political questions of how the conditions for sustainable prosperity were to be met in emerging economies. 

            There are several valid concerns about the rise of B-Schools.  Some of them are justified and suggest the need for some mid-course correction in the strategic planning of business education.  Because B-Schools are involved in market-driven activities, they can do this. .    


            Concern #1:   B-Schools have been rendered obsolete by the web which can deliver blue chip learning in a customized manner while B-Schools rely on "courses" and other outmoded organizational techniques:    The rise of B-Schools was a phenomenon of the early internet age, when there was a need to provide students with both generic and customized  skills ranging from   computer science, understanding   information systems and practical understanding of management to corporate finance and international marketing.    The nature of open-source software, the rise of wiki models, social networking and idea exchanges has transformed the concept of "education".   In this "concern", B-Schools are either past their prime or have outlived their usefulness.    

            Response:    B-Schools have to understand that they are now one of many organizations whose strategic purpose is to organize knowledge.    If  B-Schools can be value-adding knowledge navigators and discriminating and objective reviewers of information, their unique role and indisputable relevance will continue.   The open-source world is in constant need of ways to brand blue chip thinking.

            Concern #2:    The excitement is elsewhere; the sector labeled business education has been redefined:   Like all rapid growth markets, business education has seen an explosion of new entrants.  B-Schools have themselves been vulnerable to disruptive technologies.    Private corporate executive education provides some of the ingredients necessary for blue-chip learning. Blair Sheppard of Duke's   customized corporate education estimates in the May 16th, 2005 Financial Times that we have tapped only a billion out of a $34 billion global industry in customized executive education.    The overall market for business education may significantly larger than that, as Sheppard's remarks refer only to the corporate executive education market.   But as the place where consumption of education products changes from "courses" in "classrooms" to web-enabled digital communities,  the nature of the competitive  market in knowledge and information changes.   Financial media and strategic consulting companies are moving into the space of B-Schools, using simulations and scenario planning exercises to train executives. This leaves B-Schools to do the more commoditized learning process.   Bloomberg becomes as much an educational product as the Pearson Education .

            Response:   Blue-chip corporate education functions will carve out a significant portion of the top-end of the market in strategic management.   No web-site can compete with the Wall Street Journal or Financial Times in organizing networks of discerning analysts to focus on a topic of immediate importance, e.g. the impact of the Iranian elections and oil-prices.    But that is quite separate from the task of organizing knowledge for the purposes of transmitting it efficiently to the next generation of decision-makers.   The knowledge-production sector is being redefined and the relationship between wikis, Dow-Jones and a B-Schools curriculum has to be calibrated accordingly, but that means that B-Schools adjust their product and manage the expectations of their clients.

            Concern #3:   The political environment in which business is situated has changed and business in general isn't the "thought leader" it was in the pre-Enron 1990s: Much of the current attitude is reflection of mood in the   larger political environment.   The media has swung from focusing on the latest billion-company started in Silicon Valley to the few Fortune 500 companies which have proven to be seriously ethically-challenged.   Enron's business model wasn't the problem; the problem was an organizational culture of undiluted greed and arrogance.  Unfortunately, it is often hard to convince a casual observer of the difference between these two issues and sometimes almost as hard to convince a professional financial journalist.        Arrogance is always the most visible    form of incompetence.  It should    therefore be the form of managerial incompetence that is the most easy to detect.   Financial markets should have punished this arrogance, but were caught up in a collective fear of being left behind.       Somehow the public image of MBAs became associated with the exorbitant profits and compensation packages of the 1990s rather than the models of professionalization of management that were the hallmark of so many blue chip operations.  This "concern" suggests that the market has moved on in search of different "thought leaders". 

            Response:    Political trends do fluctuate.   The wealth-creating role of celebrity CEOs was exaggerated in the 1990s and the number of ethically-challenged firms that have done damage to business confidence has been exaggerated in the 2000s.    The role of B-Schools is to expose arrogance and greed as the kind of managerial incompetence that it is.   Quality B-Schools will focus on developing the kind of practical strategic management that leads to longterm growth and rewards sound decisions over a longer period of time. 

            Concern #4:   Business education has become a saturated market and B-Schools have not done enough   strategic thinking about product differentiation:    This is one way of saying that there are too many B-Schools and the sector needs a correction as in any product-area where there is suddenly over-supply.

            Response:  Obviously, the curriculum of a community college in a small town in northern Canada should be  different from that taught at Rotman or INSEAD.   That doesn't mean that business education is spread too thinly if it tries to reach more people as part of a programme of skills development, promoting economic literacy and facilitating career flexibility in a modern economy subject to rapid and frequent disruptions.     It does mean that we need to think strategically about product differentiation.  It also means that B-Schools should be careful not to reinvent the wheel, but to concentrate on areas where they have specific expertise.   This will be greatly helped if the pressure to produce "more" research and cases is replaced by a pressure to produce better research and more relevant case studies.

            Concern #5:   B-School fads lead to bad decision-making.  They are excessively oriented to themes which can be studies quantitatively:     Ghoshal's argument in the Financial Times piece cited above warned that by erroneously trying to turn finance   into a "science", the door was being opened to an organizational culture disconnected from the real world and values of business decision-making.        Warren Bennis and James O'Toole write in the April 2004 Harvard Business Review that B-Schools have "lost their way" by becoming too theoretical and removed from the practical world of business decision making.   Jeffrey Garten, in a valedictory interview to the New York Times on his retirement as Dean of the Yale School of Management, points out the difficulties of applying the university tenure system derived from other disciplines to the need to develop top quality B-School academics.      

            Response:   The core of Ghoshal's argument, compatible with Bennis/O'Toole  and Garten is correct and illuminates the dangers of "fads" from any source.   To the extent that  B-School "research" is preoccupied with fads like trying to create a science instead of teaching about the  practical judgments of human decision-makers, then it is not surprising that this would lead to a form of economic decision-making prone to errors.    There is no guarantee that bad fads or wild goose chases will not come into business (or medical) research ever again.  But the  treatment requires that B-Schools   be held accountable to standards that are relentlessly practical.    All the stakeholders in the world of business education need to resist strenuously anyone who thinks business or finance is a "science".     This is analogous to the "fad" that swept the teaching of political studies in the 1960s and 1970s, teaching with disastrous results the notion that complex political events could be understood "scientifically". for Bennis/O'Toole.  Garten is in the New York Times,   June 19, 2005.

            Concern #6:   B-Schools are trying to teach things which cannot be effectively taught in a classroom.      This is the most common "street-smart" critique of B-Schools.   The argument is a variant of "that's-not-the-way-it's-really-done".   Business is basically about hard work, a winning attitude, persistent stick-to-it-iveness .  The learned on the streets view thinks B-Schools  distract MBAs  from the core ingredients of practical business success.

            Response:     There is no doubt that all endeavors in life can be self-taught.   For every Bill Gates, there are people who drop out of sight having failed to learn adequately the skills necessary to innovate from outside the conventional process.  Most of us confess that our favorite character on Law and Order was Lennie Briscoe, created by Jerry Orbach as a great street-smart detective. Howver, for  every Jimmy Connors who innovated  a two-handed backhand by being a rebel or  every Raoul Nadal with a different strategic use of the lob, there are hundred of tennis players who have tried to play unconventionally and have failed.    Most  sports coaches know  that a winning attitude cannot be taught.  It can, however, be improved by training and discipline.   In that sense,  business is no different.  Case method teaching remains one of the great innovations of B-Schools.   To the argument that entrepreneurship or other "school of hard knocks" business qualities cannot be taught, the reply is that that is true, but entrepreneurial instincts can be cultivated and entrepreneurs can be made more effective as a result of studying and analyzing other people.  In  many other areas of business,  a talented person can learn efficiently from analyzing forty cases about company creation, about managing cross-cultural organizations,  about working with unions to improve productivity.  In each of these areas, a student can learn  from the  mistakes others made, and can be inspired by seeing how others solved complicated problems before.  

            Concern #7:   B-Schools don't teach people to be good managers.    This is a variant of the same argument as the "school-of-hard-knocks" argument in Concern #5.     

            Response:  When one sees the environment of top-quality MBA programmes,  this becomes analogous to saying Philip Glass is a very good composer, but he doesn't have much to say about a cure for cancer.    One response is to say that this  isn't what top-quality MBA programmes have been doing for the last three decades.   Most of the talent choosing to pursue MBAs has not planned on being a "manager" for quite a while.       B-School education prepares young talent with the skills required to play many roles in the modern business ecosystem, from financial analyst to management consultant to venture capitalist.  

            However, the idea that B-Schools don't teach "good managers" is also debatable in itself .  There are a large number of hires made each day in start-up firms alone where the knowledge base of a 30-year old well-educated MBA adds enormous value to the collective skills of a start-up management team.  The entrepreneurial revolution from which we have all benefited as citizens and investors would have been impossible without this use of the talent pool.  A talented engineer or scientist with a rigorous MBA, who has looked at fifty business models of start-up companies in case-taught classes, who has worked on an organizational design for a work-term new venture and who has researched on-line the portfolio strategies of a dozen venture capital firms can instantly add a great deal of value to a management team struggling with the growing pains of a new company.  There is no better way to teach managers and prepare all the other players in this modern ecosystem of business on a large scale than by exposing them to analysis of the best practices of management in cases, formal and anecdotal.   Then, the learning environment has to create a mood that helps them to develop the motivational and leadership skills required to operate effectively in a business environment.

            Of course, there are better ways to learn management than an MBA programme.  They just aren't scaleable.    The best way to learn to play the cello is still a "master lesson". A decade as an apprentice to John Chambers ,  Meg Whitman or Jorma Ollila would be a good start,  but not highly practical for thousands of people.       Business skills, like many life skills, are  not "teachable",  but talent can be developed.     It is an easy criticism of B-Schools to say that "the school of experience" is the best way to learn.    That again misses the point of what great B-Schools do to prepare people for the innovative front-lines of the modern economy.    

            Concern #8:  B-Schools are becoming too theoretical, too captured by research projects that are remote from real business issues.   There are some tendencies of   succumbing to inward-looking academic research and, in doing so, B-Schools risk losing the competitive advantage which gave them such an important and unique position in the new economy of the 1990s.       

            Response:   One hopes this problem is solved by the quality of the warnings.  It is encouragine that the Harvard Business Review devoted so many pages to the Bennis/O'Toole piece.  The Garten interview shows that this concern is being flagged  in the financial media. Once warned, B-Schools can guard themselves against the virus of being overly theoretical.   Financial resources should go to those B-Schools and B-School projects which add value to the economy, demonstrate how innovation can be accelerated and produce a network of professional B-School graduates aggressively practicing top-level ethical management.     The concern that B-Schools could  become distant from their community, disengaged from the challenging practical issues of management, investment and global business activities is a real one.     A B-School should  not be place for people who lack a passionate commitment to understanding and improving the way business operates or think that an academic theory knows more than John Inmelt at GE or Jim Balsillie at RIM.             

            At their best in the 1990s, B-Schools focus on innovative approaches to problem-solving.  At a minimum, they provide an environment where networks could pool and analyze information about investment trends and best practices in management.      They have to be on guard against declining standards of relevance.


            Things for the MBA Class of 2007 to Reflect On


            The best B-Schools of the 21st Century will build on the traditional functions of quality education: 

(a) The importance of networks for making things happen.  It is important that Shanghai bankers understand the dilemmas of African capital management, otherwise China will not be able to assume a proactive and positive role in global capital market restructuring as it starts to participate in G8+ activities.  It is important that African MBAs learn about the characteristics of the Chinese economy and the impact that this is having on global business and investment decisions.  In creating these knowledge-networks, B-Schools are laying the foundation for a 21st Century prosperity. 
              (b)   Thinking ahead of the curve is a luxury of academic institutions that don't have to meet deadlines for investment reports.    This can lead to the brainstorming of new business models that meet the challenges, needs and opportunities of   our times.   e.g. How do we capitalize environmental agriculture, nature-based therapeutics?  How can we develop a competitive market in industrial ecology?  How do we create incentive systems for different patterns of transportation?

             Once the parameters of the debate are established and once the success criteria for business education are clearly established, it becomes apparent   B-Schools are, in fact, more relevant than ever.  They are a cornerstone of 21st Century education and a global link which potentially can provide a language for the management of globalization.   

             As we reinvent B-Schools so that they better deal with the  next generation of issues, let's pose a number of questions asking not what the right answers is, but how would we want the next generation of business and social leaders to be educated as to how best to make these decisions during their career.   An MBA who has addressed these questions with his or her colleagues has a head start on acquiring the skills necessary for global leadership:

            (i)  How does Medicines sans Frontieres most effectively manage the treatment and management of its operations in Angola dealing with the Marburg virus?   How does it balance between epidemiological issues and immediate treatment?  How does it organize research so that scientists and physicians can both receive the attention to their needs required to be effective?  How does it operate with the Angolan government and international security forces in a manner which assures that it can continue to function effectively?

            (ii)  How does Goldman Sachs or Morgan Stanley analyze the investment opportunities generated by the patterns of Asian investment following an energy security strategy, the decisions regarding Korean investment in Uzbekistan, Japanese investment in Iran, Chinese investment in Gulf of Guinea area states?   How is the impact of these trends on other investment opportunities and acquisitions strategies of other clients assessed and how do non-Asian institutional investors play these trends to maximum advantage? 

             (iii)  As a marketing issue, how does a firm with a new media product enter the Chinese market? Are there lessons to be learned from the successes of Korean film exports into China , or the popularity of Taiwanese musical performers or is the Chinese market a constantly evolving pattern of global tastes?

            (iv)   How does the finance minister of Eritrea create a framework for the development of entrepreneurially led companies in Asmara?   What is the existing framework for best practices promotion of entrepreneurship?

            (v)  How do companies like Blockbuster with loyal customers and revenues prepare for the new competitive environment presented by digital entertainment and broadband on demand?    How is the strategic management issues of multiple source of competition communicated to investors? 

                  The bottom line is that there is no single conceptual framework which can provide everyone with the skills needed to answer these questions.          At the end of the day though, the argument can be made that people participating in rigorous discussions of questions like the five posed above have a higher chance of becoming practical, successful, ethical and innovative managers in the global society   than people who haven't.


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