I have concluded that the educational institutions where our future business leaders are being prepared need to be drastically modified after teaching at five business schools over the course of several decades and serving as Dean of two.
The way business education is delivered today, as well as the topics it covers, are out of date. In terms of virtual learning and tailored, customised training, our brick institutions have not yet caught up with what is now feasible thanks to modern technologies. The goals of business education need to be revised in order to better prepare future leaders with a new set of abilities, including sustainable global thinking, entrepreneurial and innovative skills, and decision-making grounded in real-world experience.
Business schools have experienced two waves historically. They were intended to be centres for practical education. Successful businesspeople like Joseph Wharton sought to professionalise corporations and legitimate the business world in the late 19th and early 20th centuries. The oldest business schools aimed to give students the resources and instruction they needed to succeed in business at the time, including contract law, efficient manufacturing, and bookkeeping.
However, this strategy was condemned by the powerful Ford Foundation and the Carnegie Foundation in the middle of the 20th century. The Ford Underpinning-funded Gordon-Howell Report from 1959 attacked the shoddy scientific foundation of business education and implied that professors were more akin to quacks than legitimate academics. The professors and students’ abilities were underwhelming, and the curriculum was very constrained, simplistic, and weak. The Education of American Businessmen, a large book also released in 1959, is the product of research conducted by the Carnegie Foundation. Its message was equally harsh: too much practise, too little theory; too much engagement with situations, too little research. Both searched for models to the research-driven natural science areas as they perceived a need for a more intellectual breed of managers to oversee enterprises of unprecedented scale and breadth.
For decades, the following reshaping of business schools 2.0 along the lines of serious academics performed its goal and infused business education with a level of valuable intellectualism. We are now stuck with an academic system in which business schools are administered as if they are deaf, blind, and dumb to a completely new emerging world, though, as every trend starts to lose sight of its need for renewal. Our colleges are becoming overcrowded with “business scholars” whose primary responsibility is to do original research to be published in so-called A-level journals as a result of the tenure system and the publish-or-perish edict. The necessity to publish in order to advance professionally has resulted in research becoming more and more specialised, which promotes silo thinking, and a serious disrespect for the value of teaching students to think.
“Performance” has evolved into the dependent variable in the majority of management research and the source of the delusions (to use Phil Rosenzweig’s term) that business scholars serve up to managers instead of concentrating on actual and practical issues that are pertinent to the modern business world. Too many tenured academics have never held a job outside of academia; as a result, they are unfamiliar with both the complex decision-making processes used by businesses and their day-to-day operations. This makes it even more difficult for them to see how important practical experience is to students’ education.
In essence, the pendulum has completely turned around. The current emphasis on theory over practise means that graduates are ill-equipped to handle the complicated issues of the real world that businesses live in. The most important thing they lack is Aristotle’s “phronesis,” the practical wisdom (also covered in David Hurst’s blog Is Management Due for a Renaissance?) that teaches people to make decisions based on fundamental ideas of what is good for the larger global community of which businesses are a part.
What should and can we do? In the recent years, there have been a lot of redesign experiments and change recommendations. In order to determine which are the most valuable, I would emphasise five underappreciated attributes. The changes we make should improve our schools’ ability to:
Humanity-Minded. Restoring the humanities and philosophy to the centre of business education is necessary. Future business leaders must be capable of critical thinking in order to understand the complexity of what it means to be human and the importance of business in maintaining a habitable, healthy world. Human values can no longer be prioritised over the emphasis placed on efficiency and profit at all costs by scientific management.
Blended. The requirement for students to spend the majority of their educational careers in large halls on campuses listening to boring, cardboard lectures is quickly being replaced by technology. The costs of business school are out of control due to the economics of running enormous campuses, faculties, and administrative staff. Many public colleges are already reducing their spending. Massive open online courses (MOOCs), which are increasingly popular and are taught by some of the best and brightest educators in the world, are showing that the traditional classroom model is obsolete.
Individualized. Offering students a variety of options will allow them to tailor their education to fit their unique objectives, aspirations, skills, and risk tolerance. Let’s let them collaborate with a sort of advisor to design their own programme that is unique to their interests and skills. Help them create a mix of classroom instruction (both on their campus and others), work experience in actual businesses, workshops and startup weekends for entrepreneurs, MOOC courses (perhaps accounting for 20% to 50% of their classes), and other learning formats that will help them develop into smart, global business thinkers.
STEM-driven. We need to encourage business students to go beyond IT and Angry Apps when it comes to technology and boost their knowledge of science, technology, engineering, and math. Given that STEM-focused industries drive so much innovation, business education must assist students in bridging the natural and social sciences. Degree programmes in industrial economics and management of technology are excellent examples of hybrid educational models that combine these two fields of study.
Hands-On. More than ever, business experience and academia need to be combined. To bridge the gap between theory and practise, universities must start collaborating with businesses to develop internship and management training programmes that are more useful. Additionally, they ought to offer instructors incentives to become more involved in the real-world issues that arise in regular organisational activity. Why not establish “Professors in Residence,” where professors temporarily reside in organisations, as a counterpart to today’s Executives in Residence? Let’s encourage more communication between businesses and universities generally.
A “Great Transformation” in management has recently been called for by the Global Drucker Forum, which Richard Straub of the Drucker Society regards as the best hope for enhancing human prosperity. I join the appeal for a completely new synthesis and method of doing business worldwide. But as of right now, I am aware that the majority of students completing both the majority of MBA programmes as well as our common undergraduate degrees are ill-equipped to handle this future.
Business executives who thrive in the next ten years will stand out for having a holistic outlook, an international perspective, international experience, the ability to speak multiple languages, a familiarity with technology, an entrepreneurial mindset, creativity, and the capacity to effectively manage complexity and chaos. We must start making changes to our business schools right away because numerous businesses have already stated that they are unable to locate the kind of workers they require. It is our responsibility as educators to turn out graduates who can thrive in a world that is drastically changing and who can influence it favourably. A new generation of Renaissance leaders needs to be educated.