07 Sep 2007  What Do YOU Think?

Are Elite Business Schools Fostering the Deprofessionalization of Management?

Summing Up. The founders of top business schools wanted to make management a profession similar to law, medicine, and theology. But the results look different, according to a new book, From Higher Aims to Hired Hands, by HBS professor Rakesh Khurana. Now Jim Heskett asks: How, and to what extent, are business schools themselves contributing to the situation? Forum now closed.

 

Summing Up

How can business schools reprofessionalize management? The responses to this month's column can be characterized in several ways:

1) Business schools, particularly those regarded as being the "elite," by their very nature have contributed to the problem of deprofessionalizing management by building more value in their alumni networks than in their curricula and teaching.

2) Business school curricula, if not always their teaching, reflect the demands of the market. This is or is not appropriate, but not unexpected.

3) How can business schools deprofessionalize something that is not a profession?

Phil Clark's comment characterizes the first line of thought. As he put it, an "elite B-school degree is seen as a ticket to connections to 'take care of (oneself),' not necessarily to provide value to any organization or build new organizations."

The market-driven explanation was offered most provocatively by Tony Wanless, who commented that "B-schools are university cash cows, and the only way to justify their fees is to go where the mass market wants it to go. So they concentrate on what will earn their graduates the largest immediate salaries." As Edward Hare put it, "'Business schools' are a business…. I'd be reluctant to blame the business schools. They … give students tools. But they rarely can teach motives, ethics, and ideals." The phenomenon is not confined to the United States. B.V. Krishnamurthy described the concerns of a hundred e-mail inquiries from prospective students at his business school. All but two inquired primarily about the earnings of previous graduates.

Eric Mueller comments that management will not be a profession until it requires "formal qualification," is governed by a "regulatory body," and establishes an "objective means to assess competence." As a result, business schools provide the business world, in his view, with no more than an "effective, albeit expensive, recruiting service." In citing 7 requirements of a profession, of which management meets only 1 or 2, Roger Manley commented that "the thought that management is being 'deprofessionalized' strikes me as a bit of a stretch." Patrick O'Rourke added, "Let's forget about striving to gain acceptance as a profession in the traditional sense, as we are not comparing like with like. The French term of 'cadre' may best accommodate the reality of business practitioners in a modern world."

Respondents also provided some possible remedies. Osbert Lancaster suggested that what is needed is an injection of "'craftsmanship'—broadly conceived as doing something well for its own sake," into the thinking of managers and those who train them. Gerald Nanninga comments, "Maybe what we need are fewer professors and more mentors." Karen Dempster suggests that students and faculty with more practical experience, as well as accreditors willing to recognize programs that "tailor learning for students" rather than just meet rigid standards, would help.

Can business schools do much about what may be largely market-driven phenomena in a field that has never qualified as a profession? Or are there ways in which business schools can reprofessionalize management? While looking over responses to this month's column, I noticed a newspaper article describing a growing number of young managers who are making so much money managing, in many cases other people's money, that they have decided to forego an MBA. Does this suggest that, by freeing up classroom spaces for those interested in managing people, that the market may help redress problems described above? What do you think?

Original Article

My areas of interest bring me into contact with companies that are, in the words of the book of the same name, "built to last." But I'm puzzled. If they represent the crème-de-la-crème of long-term management performance, why is it that only a handful of graduates from Harvard Business School—or for that matter Stanford, Wharton, Chicago, INSEAD, or other well-known business schools—have ever been employed by them?

A book being published in September, From Higher Aims to Hired Hands, by one of my colleagues, Rakesh Khurana, may help explain it. Khurana traces the development of business schools from their early days in a small number of "elite" institutions (his word) where the ideal or goal was that of creating a field of management that would qualify as a "profession," combining "mastery of specific knowledge with adherence to certain formal or informal codes of conduct and, even more fundamental, to an ideal of service." Graduates often sought long-term employment as managers in a wide range of large, established, highly-regarded business firms.

Khurana then proceeds to outline significant events that led to the dilution and destruction of this ideal, to the replacement of "managerial capitalism" by "shareholder capitalism." At the risk of simplification, among these were the results of two foundation-sponsored studies of management education in the 1950's that argued for greater emphasis on the development of measures and exploration of theories by means of quantitative analyses of various phenomena encountered by managers. This, it was thought, would legitimize a field largely based to that point on practice and shared (often untested) wisdom handed down from one generation to the next.

This was followed by, among other things, the growing acceptance of a 1970 declaration by Milton Friedman that "the sole concern of American business should be the maximization of profit" and the development of the field of "agency theory" by "Chicago School" alumni which clearly positioned the manager as the agent of the shareholder. They advocated larger performance-based incentives that were necessary to "align" the interests of managers and shareholders. Takeovers were favored as a means of enforcing the urgency of such alignment.

At about this time, according to Khurana, deregulation came along that both made it possible and more tempting for agents to act in ways that served the short-term interests of both parties while abandoning any semblance of "professionalism." As readers, we are left to speculate how, if at all, this might have led to such phenomena as Enron, the management revolving door, and even today's subprime mortgage mess. Are these the results of an era of "shareholder capitalism"?

The effect on the elite business school was, in Khurana's view, substantial. The forces described above have led to the hiring of faculty well-trained in economics and math, ready to do battle with issues and phenomena lending themselves to quantification (e.g., finance and agency theory), but "not intrinsically interested in business." It may account for evidence that students today are primarily interested in admission to, rather than study at, the elite business schools to enable them to join the best networks in order to make the most money the fastest. If so, does it help explain why they often don't go to work for organizations seeking managers of other people? In an effort to adapt, Khurana observes that nearly every one of the elite schools has adopted missions in which the development of leaders is paramount. But one might ask whether this is of much interest to students attending such programs or to the firms hiring their graduates.

This raises other interesting questions. To what extent is today's business school contributing to the deprofessionalization of management? Should it foster greater balance between managerial and shareholder capitalism? By what means? What do you think?

To read more:
Rakesh Khurana, From Higher Aims to Hired Hands: The Social Transformation of American Business Schools and the Unfulfilled Promise of Management as a Profession (Princeton University Press, 2007)

Comments

    • Anonymous

    This answer probably lies when we ask the same question at another level. How well does 'shareholder capitalism' promote long-term interests of a company? B-Schools cannot escape the market. They end up offering what's in demand.

    Maybe the way companies are valued needs to be changed. There should be some incentive given for its long-term focus when valuing a company. A CEO's performance incentive should also ask fundamendal questions such as "What has been done for the long term sustenance/competitiveness of the company?"

     
     
     
    • Eric Mueller
    • Professional MBA student

    We live in the world of Ayn Rand's Atlas Shrugged. Business schools want to produce leaders like Dagny Taggart, but MBA graduates are more likely to become looters like her brother James. Business schools are to blame for not selecting students with the will to manage and for not fostering a sense of service in their students. The ROI from attending an elite business school is exorbitant. The degree attracts the type of people who are seeking an entry ticket into other elite organizations--those that bestow power or wealth on their member.

    Society is also to blame. The 'spirit of the age' requires the best of generation xyz to manage their careers before managing their organizations. First and foremost young people must ensure the value of their own brand. In business, like politics, perception counts for more than truth. And as long as this is true, management will not be a profession. It does not require formal qualification. There is no regulatory body governing the occupation. There is no objective means to assess competence or to enforce ethical standards. Marketing and Finance might become professions in our lifetime, but not management.

    There will not be systematic change as the interests of key stakeholders are currently being met. The business schools are profitable, the students have their entry tickets, and the business world gets an effective, albeit expensive, recruiting service. The losers in this arrangement are all the potential leaders of society who are denied their entry ticket into elite organizations because they lack an MBA. Enterprising individuals master the business disciplines on their own with the aid of public libraries and open source content. These are the entrepreneurs of the world; the John Galts of the world.

     
     
     
    • Gaurav Goel
    • PGPX, IIM Ahmedabad

    The most lucrative entry-level jobs for MBA students are with the financial entities that innovate new ways to make money in short periods. These firms create ever-evolving financial products that are promoting short-term orientation in the name of liquidity and efficiency of equity markets. Creating and popularizing investment vehicles that provide limited liquidity in the short term can help to control negative aspects of shareholder capitalism. Government and regulators can work together in aligning taxation and regulations to achieve this counterintuitive goal.

     
     
     
    • J Lalos
    • Sr Business Analyst

    Perhaps the analysis made by Khurana explains the change I have been seeing over the last 6 years. My perspective comes from being in an IT department of a large corporation, which has had to report to 7 different managers and 5 different directors since 2001. In addition, I recently earned my MBA and have a 40 year work history.

    The emphasis on customer service and increased innovation and/or efficiencies promoted in the 1990's has given way to the communistic arrogance of central planning. I have seen teaming, the Japanese methods of incremental changes and the notion that those doing the work are closest to the issues replaced by autocratic decision-making and disregard for suggestions coming from the person with the most experience. This in turn has resulted in inefficient bureaucratic tools aimed at control, not quality improvements. At the same time, attaching dismissive labels of 'uncooperative' or 'negative' to those noticing inefficiencies has become commonplace. Short-term thinking, making money the fastest have replaced the emphasis on quality, efficiencies and productivity.

    Finally, a bonus, which used to be based on pre-defined financial goals known to everyone and paid to the entire workforce, was replaced by bonuses paid to and based on goals only known to managers. Non-managers no longer have a share in the success or failure of the company.

    How can our corporations prosper with these behaviors? Our ever-increasing reliance on out-sourcing masks the cost of our increased inefficiencies. Cheaper labor has enabled the agency theory of management to prosper, by hiding the true costs of short-term decision-making. The real question is, is this approach sustainable for the long run?

     
     
     
    • Arthur

    Profit maximization is an important objective for businesses. It should NEVER be the sole concern, as that is a recipe for long-term disaster. Friedman's ideas led to the "Greed is Good" philosophy, and Enron was not the only result.

    More important than profit maximization is long-term profitability. It's better to earn an annual profit of $10m over ten years, than $10m in year 1, $10m in year 2 (i.e. twice as much) but then make losses of $3m per year for the next 8 years as the previous two years profits came at the expense of building long-term profitability (perhaps by refusal to invest so as to maximize profit).

    Today we see the results of this - with refusal to accept that actions today have an effect on the world tomorrow. Business needs to take into account human capital - and well-being, so that people have the loyalty to build long-term profitability. Business also needs to take into account the global situation - global warming could destroy many businesses, and so long-term profitability needs to take this inot account also.

    The problem is that business schools may teach some of the long-term techniques (e.g. scenario planning), but their students want a quick pay-back on their investment in studying, and so develop a short-term approach. Worse, the US markets demand this - with a poor quarterly result resulting in a company getting downgraded, even if the longer term future is positive.

     
     
     
    • Osbert Lancaster
    • Executive Director, Centre for Human Ecology

    These questions resonate with deeper issues raised by Richard Sennett in The Culture of the New Capitalism.

    Sennett highlights the 'spectre of uselessness' that haunts so many today, and suggests 'craftsmanship' -- broadly conceived as doing something well for its own sake - as being part of the antidote.

    Where the craftsman 'digs deep into an activity to get it just right', the consultant 'swoops in but never nests', often with little understanding of the organisation and its activities -- and with no long-term interest in, or responsibility for, their results.

    Is this also an accurate description of de-professionalised managers? If so, it does not bode well, either for their employers, nor for a world that now more than ever needs people with real skills and deep commitment to addressing the challenges of climate change and sustainable development.

    Swooping in, but never nesting, will not deliver the changes required.

     
     
     
    • Haroon Sheikh
    • CEO, Presto Groceries

    Sir,

    Having attended an 'elite' MBA school and having worked 10 years in industry and two years in consulting, my experience contradicts your hypothesis.

    The reason the 'elite' are not hired by companies 'built to last' is that these companies refuse to believe that anyone from the 'outside' can possess better management skills than the 'home-grown' talent. Consequently, they give the same tasks and jobs to a higher profile candidate - an 'elite MBA' (with demonstrably higher potential, brainpower and ability) as they would to any other non-MBA candidate.

    In organizations with 'elite-school' MBA management at the top, you would see a difference in treatment, roles and responsibilities etc.

    It's like making a ferrari race with a toyota under a speed limit!

     
     
     
    • CJ Cullinane

    The professional manager has become more of a short term interim manager looking for a quick fix or fast profits versus the business builder. The business schools do add to this short term focus but almost out of necessity. The focus on the quantitative versus the qualitative slants a school to short term numerical goals, and not the vision goals of a business builder.

    Both aspects are essential but the pressure to turn out short term caretakers and not builders starts the business student down a path of an interim manager with less focus on the long haul.

    How can a business school point the graduate towards the path of long term solid growth and not the "Enron" path? More focus on the long term, stress the basic ethics and tools of management not the quantitative tools that seem to change daily.

    The news today is loaded with stories of disaster caused by over used quantitative tools (the Quants) versus basic common sense and solid business practices. Business schools should focus on these solid business practices. Have a group project that extends more than one semester, or a year if possible.

    I do believe the business schools reflect the current environment, but maybe they should set another standard to follow.

    Charlie

     
     
     
    • Anonymous

    The B-schools are not to blame, it is the lack of "highly regarded business firms" that has changed the game. First of all, the number of highly regarded companies has been dramatically reduced. Take the auto industry, the steel industry, and the oil industry for examples. A large number of firms in these industries have experienced a dramatic fall from grace. The most highly regarded firms today are technology related and they could be here today, gone tomorrow. This is not to mention the large number of companies who exploit third world laborers in the name of profit. The final, and perhaps most important aspect of this phenomenon is that traditional companies have largely abandoned the long term employment model themselves. The elimination of pensions and frequency of mass layoffs (that are not dependent on performance) all contribute to this problem. Let's face it, contributing 3.5% to my 401K is not going to make for a very good retirement! This has motivated the top MBA students to focus on building their career, rather than building a specific business. It is simply too risky to put all of your eggs in one basket when you need to be gaining skills for your next job. The fact is, traditional companies are not nearly as stable as they were in the past, and they do not offer enough short or long term compensation for the top B-school grads to take the risk.

     
     
     
    • Phil Clark
    • President, Clark & Associates

    Some great comments. I especially like #9 who eludes to the concept that business don't take care of their people and thus people are starting to focus on how to take care of themselves. A elite B-school degree is seen as a ticket to connections to "take care of themselves" not necessarily to provide value to any organization or build new organizations.

    Bottom line - All business is about people. Not measurements, processes, dollars etc. About people. The only reason to have a business is to make available resources for your family and to live a life. Everyone has the same goal. I am not sure the adding "leadership courses" to schools makes a difference if you do not instill the need to understand how organizations contribute to the well being of people, society and nations. Wall street is not the ultimate measure of success or even of how a company contributes to the world.

    I think the modern reflection of those trying to go it on their own because they do not trust the large organizations is the growth in entrepreneurship. As #9 says, "contributing 3.5% to my 401K is not going to make for a very good retirement!"

     
     
     
    • Fidel Davila
    • Founder/CEO, objectHEALTH

    There are two major issues in a profession: process and content. Doctors, Dentists, Lawyers can be professionals because they get trained in both the content and processes of their professions. MBAs, teachers and computer programmers are a few examples of jobs that cannot be professions. That is because they are trained primarily on processes with little to no training in content.

    Teachers know how to teach but there is no guarantee that they know the subjects they teach. A computer programmer can write a program but about what? A MBA know business processes but not the business content. And, that is the error of these schools.

    Education should be a minor with the major being in the subject that the person wants to teach. The same should go for computer programming. MBAs need to have business content; so that they can apply their acquired business processes.

    MBAs are rarely frontline workers who have acquired the business content needed to apply their business processes. The problem then evolves to having generic processes running the business due to the loss of significant content from the loss of experienced content workers without MBAs. This is going to a significant problem as the baby boomers retire. The thinking that believed selling soft drinks is the same as selling computers is the thinking that is causing disenchantment with business management.

    Many believe that the problem with this country is too many lawyers. What they miss is that there are too many MBAs who are mucking up legitimate business through their generic processes and lack of content knowledge.

     
     
     
    • Adam H
    • alumni, HBS 1982

    There are MBA candidates that see management as a profession. But when the compensation gap between investment banking or consulting and management widens too far it is highly problematic for graduates to follow their dreams. Let's not forget that the MBA is not free, so recovering the investment is no mean feat.

    The problem rests less on the high compensation offered to "hired guns" than the low compensation and poorly structured positions crafted by corporations. When so much of the total compensation pie is reserved for the very top positions, while those lower in the structure struggle to advance into and beyond the middle class, it appears as if society would prefer the brightest young minds find their ways into more autonomous roles. Corporate compensation plans have not been structured to reinforce those who study management more deeply, or choose to apply it as a profession. Instead it has rewarded those who were selected for top posts leaving the rest to struggle with layoffs, outsourcing, lowered bonuses and benefits packages not to mention pay enhancements that rarely exceed inflation.

    As Haroon pointed out in his post, companies have not structured roles to allow more ingenious and talented managers the opportunity to excel. The road up the management ladder has had more to do with senior relationships, and being "chosen" by someone highly placed, than being given opportunities to demonstrate a diversity of capabilities and produce above average results. Bright and capable people become discouraged when they see peers who are far less talented and less effective treated equally, or perhaps even better, than themselves.

    We must put considerable blame on the hiring and compensation practices of traditional businesses - both large and small. Over the last 25 years they have rarely sought out the best people (despite public statements), and even more rarely tried to reinforce the best people's participation in management. They frequently have gone so far as to discourage talented people's involvement, instead preferring more mediocre managers that have less lofty ambition for themselves and their employer - and are satisfied with lower rewards.

     
     
     
    • Charlie Carroll
    • consultant, independent

    People like to talk about the short-horizon problem in American business and point to the long-horizon view of Japanese businesses. And what have they accomplished? Their feudal environment also fosters ignorig reality and subordinating "public" interests to benefit major banks and corporations.

    Why do we seek 'greater purpose' for businesses? What is the purpose of businesses? The ultimate purpose of most professions is to serve the public-at-large rather than to cater to individual wants. Most are not inimical to economic gain but such is not (or is not supposed to be) the focus. There is nothing wrong with putting personal economic success on top so long as it does not totally dominate our actions. Many societies now and in the past asked or required their members to "donate" a couple of years of their lives to those societies with the understanding that some will continue in these pursuits and others will move to more-self focused activities; but with the memories and influences of their altruistic experiences.

    Might we be better off if ALL educational institutions taught and encouraged moral behavior AND if they drew attention to the pragmatic practice of societies to generate and enforce standards of conduct?

    We live better because we specialize. In order to specialize, we live in societies. In order to live in societies, we must squelch some of our baser and more immature instincts to some degree and/or at certain times.

    We can all be more relaxed and focused on the various technical and strategic challenges of our businesses if we are confident that our business partners, competitors and customers are, at least, trying to operate within a shared moral framework.

    Charlie Carroll, PMP Major, USMC (Ret)

     
     
     
    • Gerald Nanninga
    • VP, Retail Ventures Inc.

    Another point to consider is the way in which the elite schools choose their professors. It has more to do with academic credentials and the ability to write papers than with any kind of practical professional management skills. How can professors teach that which is foreign to them? Naturally, they shift the agenda to a place where they are more comfortable--quantitative analysis and abstract theory. And if the professor is more concerned about research, writing books, doing consulting or whatever instead of teaching, it gets even worse. Maybe what we need are fewer professors and more mentors.

     
     
     
    • Zorba Manolopoulos
    • Intel Corporation

    I see 3 items.

    1. Is the elite school relevant long term? Like the GPA, as time passes it becomes less relevant in hiring decisions. Someone heavy on GPA and light on experience could be hindered. As further time passes, the school becomes less relevant and only the degree remains. But even in this case, it is merely a check box that a candidate must fulfill. At some point, experience and success completely overpowers any education or school association. The quality of the school comes into play when deciding between two very close candidates.

    2. As more 'non-elite-school' employees move up in the company, become successful, they also create their own networks. When they look out to hire future employees, they look for similar qualities in their candidates. If their education got them to where they are, why would their replacement need a better school? Would this admission lower the quality of the hiring manager's own education? Just as elite schools have their network, so do non elite schools. Pretty soon a company can have many employees from the same school.

    3. Leaders wanted, not managers. We look for leaders or potential leaders. Sometimes this requires technical knowledge or process experience. A manager may have 'mastery of specific knowledge with adherence to certain formal or informal codes of conduct and, even more fundamental, to an ideal of service', but the employee needs to be able to lead those who he/she manages. To lead, experience is required; not necessarily from the company, but rather from the employees on his/her team.

     
     
     
    • S Ramachander
    • Executive Coach & Faculty, Independent

    From the day business schools began to deconstruct the craft of management into functions, subjects and sciences (largely mathematical and some psychological) they began to move away from the real world. In the drive towards looking and sounding sufficiently academic they fell prey to the same disease that economists did -- physics envy. This alone contributed to bringing in the wrong sort of student and encouraging the thinking that linear, logical single-answer issues are all that matter and analytical tools are the baggage, the take-aways from the education. An emphasis on money and short-run success as distinct from building long run organisations further added to this. And teams and all that kind of good stuff became add-ons. An engineering and an accounting mindset, both from more exact professions dominate even to this day -- in the student body and in the faculty. I see no end in sight. Unless we go much of the way with Mintzberg!

     
     
     
    • Michael R. Riley
    • Retired Senior Executive, Department of Navy

    Busines schools large-and-small, well-known and not-so-well-known provide a market driven service to both individuals and organizations. But it would be interesting to hear Dr. Khurana's opinion on the historical significance of the progression of business practices from the industrial revolution through the information revolution, as influenced by the increased level of education of the work force. (The terminology business practices is used here broadly to refer to management processes.)

    My civilian experience as a first line supervisor (13 years), second level supervisor (6 years), senior executive (3 years), and my experience as a commanding officer of six naval reserve units is consistent with your comment about "elite schools" shifting to leadership topics. In general, people do not like to be "managed" as much as much as they like to be "led". The higher the education level, the less management is required, and the more leadership skill is required to achieve an organizational objective.

    In today's information age and beyond, the market for "business schools" will continue, but the need will continue to be for leaders, not just process managers or skill in shareholder capitalism. Knowledge of management processes is necessary, but over-management can be a negative influence on organizational output.

    Schools should therefore continue to focus on leadership intangibles like passion (e.g., for excellence), vision, creativity and innovation, amenability to change, empathy (for colleagues and customers), communication skills, ability to influence others, morality, or empowerment, just to name a few?

    I sense the bigger dilemma for the "elite" school leaders will be whether topics such as these can compete with medical or legal knowledge to qualify as a profession.

     
     
     
    • Oscar Garcia
    • Responsible for purchase and Management Control, Marmoleria Leonesa - Spain

    When in the strategies of the companies its last aim is: 'to create value for the shareholder' supposes to go beyond a financial result, beyond which Friedman considered (1962): 'the only social responsibility of the companies is to increase its benefits'. It supposes to execute and to develop the social function that all company has. The economic approach must be a part of the social approach.

    The happened financial scandals at the end of Century XX have brought a greater control on the companies (Sarbanes-Oxley in EE.UU.), whose final mission it is to introduce in the markets (very different and more complex today than yesterday) transparency and effectiveness, not harming the shareholders. This balance is the one that must gather the schools of business in their respective programs, sustainable return in the time is wealth, the triple bottom line accounting (economic, environmental and social), this is the balance between managerial and shareholder capitalism.

    The company today needs integral managers (personal and professional) with a global and ethical vision of the businesses (the markets are more complex).

    In a recent conversation with a vice dean of a Business School top in Europe, it was indicated that when somebody decides to do a MBA the person must consider the methodology, knowledge, learning, prestige, reputation and networking. I also would add the VALUES that the School presents and the Society demands (commitment or ethics).

    This is the future guarantee today, tomorrow?

     
     
     
    • Anonymous

    Over many years of interviewing, I have observed that students (especially business students) no longer study Greek tragedy or Shakespeare. Many test out of the courses that were once required for all. I mention this because such courses taught (if one's own religious background failed to) that arrogance (pride) and greed are among the seven deadly sins. Indeed, over the last 30 years or so, greed and arrogance have been glorified. The reality is that the consequences have been tragic for American society as a whole. I do not know what, if anything, will reverse the trend.

    Re the statement that companies "built to last" are not hiring the graduates of "elite B schools:" Such companies have probably learned that these graduates are not compatible with the goal of building a company meant "to last" for decades. To put it bluntly, perhaps the elite B schools and their graduates are not nearly so wonderful (or valuable) as they would like employers to think.

     
     
     
    • James McLean

    I would direct readers to recent work by Henry Mintzberg, management professor at McGill, particularly his recent book "Managers Not MBAs". Paragraphs 1 and 3 of post #11 do quite a nice summary of Mintzberg's point of view. More information, including articles and debates on this very topic, are available on his website. Further, he has developed a master's degree, in co-operation with other business schools, that focuses on the craft v. the process.

     
     
     
    • Adrian Grigoriu
    • EA consultant

    The idea that one or a few "elite" business schools would supply the top management of the top businesses of America, or the world for that matter, is worth the analogy to a conspiracy theory with the school and network of alumni assuming the power.

    I worked with a fresh graduate of a top business school, with little work experience or specific domain skills, actively aiming, if not demanding, a managing position because the school persuaded him to think he is entitled to be a manager on graduation.

    The knowledge to understand the business domain is learned in years of study in schools, practical experience and dedication. The knowledge required for a top management position used to be acquired, not so long ago, by raising through the ranks.

    The MBA is only a relatively small taught component of business administration, a useful but not indispensable supplement in the process of becoming a business leader.

     
     
     
    • Anonymous

    There is a difference between capitalism and predatory capitalism. Perhaps business schools may care to learn the difference. May I suggest that not doing so materialises precisely as "deprofessionalization".

     
     
     
    • Santhanam Krishnan
    • Dir (Courses) & Chief Course Architect, National School of Banking

    The very act of establishing Business Schools was for the pupose of professionalize the "de-professionals" of 'management'. Therefore one would hardly agree with the proposition that the current day business schools contribute to deprofessionalization.It seems the current aim of the business schools is to make every individual of substance, "a-jack-of-managing" through an aggressive academic exposure of relevant topics.

    In this game plan I don't think any conscious distinction is made, such that the society gets "deprofessionalized" managers of business. The avowed intention of such courses itself is to create an abundance of "professionalized managers" - Infact many institutes refine this fundamental thinking and offer specilized versions of managerial education including that of family managed business. At best these courses seek to create a proletariat of knowledgeable managers - be it individuals of private capital or otherwise.

    A development of this kind is and always been seeking to create a balance of managerial and share holder capitalism - though in reality the balance always tilts in favour of shareholder capital. However realistic the case studies may be, a class-room is not actual business! On this front,we have seen numerous examples in the past. After all, when I am the boss, I won't be expected to be treated as a servant, would I?

     
     
     
    • Anonymous

    As I read all the comments, there is one thing the elite business schools never teach. How to work in third-world economies. Everything is custom-made for fast career development in the West. Also mentioned is the quality of the teachers; often they know the book answer, but the real life situation is not even understood by them. So at the end you will have a nice diploma and doors opening but no real-life problem solving. Enough people understand certain economic problems and are participating in lower management. But not having the right degree, network or social background keeps the problem unsolved.

     
     
     
    • Santhanam Krishnan
    • Dir (Courses)& Chief Course Architect, National School of Banking

    Well do these Ivy Schools contribute to business leaders who do business and add value to communities in which they live?

    As a rule rather than exceptions spectacular successes in businesses have come not out of the graduates of these schools - but out of an idea or a concept passionaltely pursued by those who who had it. Bill Gates represents the essence of what I have said. Orderly education and scientific training need not necessarily have provided the business leaders - in the past or in the present - at best such an education has contributed to an orderly "paper" study of such developments and make others contribute by refining and replicating. Even the technology-based businesses which have mushroomed owe their origin not to the degrees obtained from management schools but by the passion to pursue actions based on gut feeling of the pioneering promoters.

    There are several key questions that still need answers if we are to objectively evaluate the success of our business schools -- they are:

    How did these schols contribute in creating leaders who in turn have made their presence useful to the society in which they live? Or have they remained just ornamental?

    Meaningful answers to these will truly reflect the effectiveness of these schools and their "products".

     
     
     
    • Ulysses U. Pardey, MBA
    • Managing Director, Am-Tech, S.A. Panama, Rep. of Panama

    To what extent is today's business school contributing to the deprofessionalization of management? Should it foster greater balance between managerial and shareholder capitalism? By what means?

    I observe that business, management and leadership can be performed very professionally thanks to the great contribution of business schools and their students. People, in general terms, are hired and paid to get a certain job done. So are managers and MBAs.

    Money, per se, is not a bad thing; however, what could be questioned is what is done to get it and what is done with it. Does the end validate the means?

    In essence, I believe that what really could be at stake behind all this query is the way we live as a solution of our needs. What would be a way of life better than the one we live today and what for?

    Allow me to share with you this problem-solving tip:

    "We cannot solve the problems that we have created with the same thinking that created them" --Albert Einstein.

    Best wishes,

     
     
     
    • Anonymous

    "We cannot solve the problems that we have created with the same thinking that created them" --Albert Einstein.

    Ulysses shared the above tip with us, perhaps managers and leaders can be found at the Kennedy school, Fletcher school, Woodrow Wilson school and the likes as opposed to business schools.

    I work for a very successful software company here in Silicon Valley. I've never worked for any other industry except technology so I am not familiar with their processes. Here in the valley, only result matters. As such, one could argued that this is true meritocracy; college dropouts, local state schools, immigrants and elite school graduates are all "equal." Only their work performance, ideas and results define them.

     
     
     
    • Anonymous

    The crucial thing in a business administration MBA course is passion for business, isn't it. And their 'preachers' haven't found a way to transfer passion from one student to another, and I think they never will.

    Why is Petrobr's getting low profits in a time of high oil prices?

     
     
     
    • Roger Manley
    • Professor, Florida Institute of Technology

    There is a passage in the HBSP case study, "The Final Voyage of The Challenger," which describes the off-line caucus among Morton Thiokol executives and engineers concerning the engineers' recommendation not to launch the Challenger the following morning: "He [the senior Morton Thiokol vice president] turned to Lund and asked him to take off his engineering hat and put on his management hat. From that point on, the managers formulated their arguments for their decision to launch, excluding inputs from Boisjoly and Thompson."

    In my opinion this passage speaks volumes on the subject of management as a profession. The engineers displayed principled behavior, and the managers gave NASA the answer it wanted to hear.

    It is my understanding that there are seven accepted characteristics of a profession: 1. A body of specialized knowledge; 2. A formal education process; 3. A public interest in the work the group performs; 4. Recognition by the group of a social obligation; 5. Recognized status indicated by a license or a special designation; 6. Standards governing admission to the group; and 7. A code of ethics.

    How many of the above apply to managers? One, maybe two...?

    Therefore, the thought that management is being "deprofessionalized" strikes me as a bit of a stretch. Perhaps it all does come back to values, ethics and leadership.

     
     
     
    • Brian Mahoney
    • Director North American Sales, Hayes, Pulz LLC

    There are several driving forces that are molding elite MBA program graduates into hired guns rather than licensed professionals:
    a) American companies are focused on providing results to shareholders. b) American companies no longer are safe harbors for lengthy careers. c) The wide variety and depth of opportunities in size, vertical business type, and skill set don't map to a specific set of skills such as those of a law school, med school, or engineering school.

    To me, 15 years after my MBA, the most important thing for a recent grad school graduate would be a grounding in finance, marketing, sales, product development, and most importantly, character and ethics. As well as a willingness to really learn the business, rather than just punching a ticket. We understand the average life span is 3-4 years per company, but we still need full and complete engagement.

     
     
     
    • Anonymous

    Let me echo the comments of #27. I, too, work for a high-tech company. A startup, in fact. So everyone in the room is an expert in their field and has a very real interest in making the company fly. As I look around the room I can find no one without a deep contempt for "professional managers". We have seen too many of them smother perfectly good ideas (and careers) through overmanagement.

    Conversely, we all have known good managers in our careers, and maybe some of them even went to school for it. But here in reality-land, it's the product that matters, and more to the point, the product has to be good enough that people will give you money for it.

    Our company goes where the technology pushes it, there is no hand-of-god Powerpoint "vision" slide that we follow. Yes, we have a technology development plan, and yes, we hired a professional CEO/CFO (same guy) to make sure we get the process of business correct. But the key here is that he knows his place, i.e. not at the laboratory bench. When considering our next product we often draw on his long history of small-company management for feedback and perspective.

    Also worthy of note is that we don't mess with his spreadsheets and budget modeling. Why? Becasue we're not experts in that field and we would screw it up. In general, it might help if our CEO were somewhat more technical than he is, but what we appreciate is that he's earnestly trying to learn about the product. Likewise we like to look at and help shape the budget, but we leave the nitty gritty of it all to him.

    The main point is that the relationship works because we are all experts and we know our roles. We do not want to, and probably couldn't, do our CEO's job. That's why we hired him. We place great trust in him not to run our company into the ground. It's a risk we take as shareholders.

    I would make the same request to all the professional managers out there, please do not make technical decisions for which you are not qualified. Ask the engineers and scientists for their opinion, and then TRUST them to do their jobs and give you an honest answer. Then, armed with a good dose of reality, figure out a way to help the technical staff make their next product.

     
     
     
    • Malvin Bernal
    • Consultancy Unlimited - Philippines

    I'm looking at this from a different perspective. In this regard, I would rather assert that elite business schools are fostering "practicalization" of management, rather than deprofessionalization.

    There was a time when universities, especially with reference to their post graduate courses, seemed to operate from an ivory tower--where knowledge acquired would only be produced and consumed for academic exercises. Where a thousand and one theories would be formulated without regard for human implications as applied within an organizational context. Where the needs of the corporate world were not being addressed by these scholastic institutions. And you wonder why there emerged the concept of corporate universities?

    It was only during the time when partnerships between universities and corporate organizations emerged that these schools were made relevant and began to speak the same language.

    It wasn't by design that this phenomena started to materialize. Global competition that made this necessary. It was competition for students for the university perspective and competition for talent with the other. Whether it's deprofessionalize or practicalize, the important thing is the capacity of these institutions of learning to continuously re-invent themselves in ways that would serve the future. Whatever that maybe...

     
     
     
    • Karen Dempster
    • Director, Karen Dempster & Assoc Creating Change

    As a mature-age student, my frustrations are many with "management" training. I have been a manager for more than 25 years, and am a woman who started work around 15 years of age and learned a lot--and got promoted--studying along the way.

    Also, I am not attending an "elite" university--at least, I don't believe it is--but a major one that has a particularly strong point of differentiation. It tries to leverage this, but is constantly churning through (quite young) students who end up with plenty of theory, passing grades, and, I find, very little depth of comprehension of the subtleties of their subjects and the management of real-life staff.

    They WILL mess up, and with their heads full of all that theory they will wonder why it "doesn't work" in real life. They come out profit driven, wanting to box the human element into financial spreadsheets and reports to shareholders. Then they wonder why profit is not made, and how suddenly 20 percent to 50 percent of the employees are not pulling their weight... And so it goes because no one really does any really creative diagnostic work until profit drops dramatically.

    It seems to me also that many lecturers are attracted to teaching work within a business school/graduate level at university as a marketing exercise, talent-capture opportunity or strategic alliance to fold into their own consultancy work. They locate the brightest and highly-functional students and use the teaching experience as a sort of business network. Not that this is necessarily wrong in my opinion, unless it is the primary driver of being involved in the field of education. I leave that soul searching to each individual to consider.

    The task of truly creating holistically competent managers, which I feel necessitates experience and hands-on learning through hard knocks, is I feel lacking win course design. Frankly, the strict structure of courses and the need to keep students aligned to paying as many fees for as many subjects as possible, coupled with lack of flexibilty in terms of truly necessary "learnings" for an individual, is frustrating. Accreditors are also to blame for this, binding funding, structure, and ease of auditing around stringent rules, making it impossible for educators to tailor learning for students.

    Will I get to learn what I feel I need to without taking on 2 more rounds of study over another decade? Perhaps there are major problems in the timeline of getting to real knowledge. For some it is too short, for others, way too long.

     
     
     
    • Anonymous

    The founders of top business schools wanted to make management a profession similar to law, medicine, and theology. But the results look different. The question asked is to what extent are business schools themselves contributing to the situation?

    In my view, management is not (and will never be) an exact science. It is art and science. However, like the other disciplines, it is also dynamic and evolves constantly. It is a profession that you can not acquire through education only but also requires experience and attitude.

    I think it is wonderful and more challenging than other professions. Elite schools do not contribute to deprofessionalization of management. On the contrary, they constantly attempt and compete to serve needs of different stakeholders even when those needs are ill defined exactly as that of management itself.

     
     
     
    • Kapil Kumar Sopory
    • Company Secretary, SMEC (India) Private Limited

    Today's business schools teach many good things aiming to develop future managers. However, they do not generally churn out professionals and hence the end product of a business school is intelligent stuff, more theoretical than practical. The problem, I feel, lies in the schools creating a halo around an MBA who is made to feel that he is a superior being right from the day he earns his degree. This is far from reality because business has complex demands which have to be learnt assiduously over a passage of time. Great employers made the new MBA entrants pass through the rigour of grass-roots jobs so that they learnt the profession bit by bit utilizing there knowledge to understand the basics faster and better so as to proceed further towards higher demands and challenges. Thus the MBA got groomed into a professional who could then deliver desired results and achieve the corporate goals.

    Business schools need to also teach: risk taking; ridicule facing;innovative leadership; building ethical, honest and sustainable relationships with all stakeholders; business communication (both oral and written) skills; techniques to spark creativity; helping students find their purpose in life as also how to find stress-free balance in life.

    Shareholder is the owner of the business and as such very important stakeholder and his expectations need to be met appropriately. Even if we use the term "shareholder capitalism", the fact of the matter is that the shareholders deserves to grow by sharing the profits; to this the management has got to focus although not at the cost of the corporate interests which should be continuous healthy growth with profits. After all, distributing all profits as dividends to shareholders cannot be permitted and resonable balance has to be drawn between the interests of the entity and shareholders, the former getting prioritized over the latter.

     
     
     
    • Rakesh Seth
    • Maral Overseas Ltd

    I personally feel that MBA is a powerful education. It is attitude building course. This education has created such hype that in case a person does not possess this in the corporated world, he is looked down upon. Probably the emphasis has to be on drawing a balance rather making it again a marks-driven course. For this course each person should have working knowledge of all subjects and should have sound knowledge of social awareness.

    Making more and more money is the goal of many organisations but at what cost?

    The expectations from MBAs are very high because of the cost attached to it and hype it has created. It means that if one has an MBA then he must have answers to all problems.

    Management should be taught by people who are either great researchers or practising managers with solid experience behind them, and not by professors with two or three years of experience.

     
     
     
    • Tom Walsh
    • Operations Supervsior, Brooklyn Power Corporation

    We are creating analysts and not managers. If we look back in history at the various trades, a person earned the title "Master" only after toiling many years under the guidance of a mentor or journeyman and learning his craft.

    What gives a person and school the right to accept a person with a Bachelors degree (an apprentice) and no business experience into an MBA program? We see many students graduate with their Bachelors degree and immediately after graduation accepted into the Master's program with absolutely no work experience. My guess is it is part of the capitalist system of generating revenue; the business schools are, after all, a business.

    My schooling consists of two trades in which I attended classroom study, but I learned the skills of my trade on the job (as other professions do as stated in comment #11). We are doing our younger generation an injustice by not giving them exposure to the real world of managing people. They can analyze case studies and financial studies but this in no way prepares them for real world experiences on the job.

    Mintzberg has the right idea, as comment #20 states, and focuses on the craft rather than the process. I began pursuing my Bachelor's degree in Management a few years ago at the age of 37; I had entertained the thought of pursuing an MBA after the Bachelor's degree, but I know now it will not be the conventional MBA but through the Mintzberg ideology.

     
     
     
    • Anonymous

    S. Langer in Philosophy in a New Key suggested back in the 50s that the way in which questions are posed limit the possible answers. As in TRIZ, one might ask what is the real problem here?

    One of your respondents suggested a lack of morality. I see more and more young people with the "who cares?" and "who cares about anyone else?" attitude. Schools don't teach that, but B schools probably, by their nature, teach the individual, as someone has suggested, "how to get the most out of this as I possibly can...and screw anyone else."

    Arrogance formulated in schools or because of who one works for does not solve consumer problems. M&As don't solve consumer problems, only line pockets of the bean counters, and add costs to the consumer. B schools need to teach not business problems and resolutions, but "solving consumer problems." So ask the right questions..."What should B schools teach?"

     
     
     
    • Alessandra Malanga
    • Homemaker/Filmmaker, Mi casa

    When we consider the idea, presented in a comment above, that in certain companies only the merits of a person count, not where the individual comes from, nor the school of origin, we are only focusing on the process not the end results, and what could be seen as a very democratic statement ( equal possibilities to all) is indeed pure demagogy.

    It still implies and underlines that the profit of a company is the bottom line, to be reached at whatever cost, no matter who enabled it. It doesn't imply that is really in the best interest for the company and for society in the long run. There are still boardrooms to be pleased, and the shareholders have still the most of the power to influence a company strategy.

    In math there is a theorem that says that by changing the order of the factors the product doesn't change. We are still dealing with the same math problem. Not necessarily an individual that comes out of a regular school or any other background, has necessarily good ethics or wisdom. The same can be very well said of somebody who belongs to an American elite school or clique. I agree that it would do so much good in order to become a wise, enlightened and ethical manager, the study of the 37 tragedy plots of Shakespeare. All possible scenarios and their consequences are portrayed, ready to be analyzed and weighted before he or she enters the boardroom and has to take paramount decisions for the company and the livelihood of a lot of people. To be or not to be ... This is the question ....

     
     
     
    • Stan Heard
    • Consultant, Dale Carnegie

    Did B-schools deprofessionalize management? My opinion is yes.

    Management is an abstract concept that is created around four functions (planning, organizing, leading and controlling). At least that is what I was taught 40 years ago.

    Then came an era when people were taught that management and leadership were opposites. That meant that when a manager was managing he wasn't leading and when he was leading he wasn't managing. This meant that one of the functions of managing was not a function of managing. That "crashed" the definition of management.

    A manager must perform all the functions of management in an interactive process. It is not managing if you don't plan or you don't organize or you don't lead. It is perfectly ok to be a planner or an organizer or a leader. But it is only management when you do ALL the functions together.

     
     
     
    • Susan Strayer

    As an MBA, I think this is easy--we are too busy beating up on each other, we are sacrificing ourselves. Read the Business Week MBA forums and you will see that the majority of the discussion is focused on one school's students beating up on another. We've created a culture where we are so focused on being in the top ten, that we've lost focus on market demands. Ten years in HR, all in corporate America, and I can tell you that an MBA, let alone one from a so-called top school, isn't a differentiator anymore. Executives want behaviors first and skills second. It used to be the otehr way around. But the longer we focus our energy on who should be in the top ten, and create a culture that breeds anger, elitism and unhealthy competition, more and more business professionals, especially women, will decide it isn't worth the investment. I hope that's not true--but I fear that is where it's headed.

     
     
     
    • Linda Joy Ortiz
    • Self-Employed, Cosmetology / Salons

    Business Management is a combination of both Art and Science. A true leader will utilize and possess qualities of each. The University that I attended has a worldview outlook with a high moral and ethical expectation / commitment not only to their students, but also to the diverse communities that they will ultimately serve.

     
     
     
    • Tony Wanless
    • Management Consultant, CMC-Canada

    Perhaps the problem is that the business schools seem to have lost their focus.

    Instead of training managers, e.g. leaders, they've shifted to turning out highly paid corporate functionaries who can help a company's financial situation, but are for the most part far too competitive careerists to ever be leaders.

    B-schools are university cash cows, and the only way to justify their fees is to go where the mass market wants it to go. So they concentrate on what will earn their graduates the largest immediate salaries. This is usually some job that will help a company quickly improve both its top and bottom lines.

    That's why so many schools have been caught by the emerging desire among many potential MBA candidates for entrepreneurship training. Entrepreneurship requires leadership skills, and while the big schools are trying to adapt, it's hard to shake off the corporate functionary thinking.

     
     
     
    • Dr B V Krishnamurthy
    • Director and Executive Vice-President, Alliance Business Academy

    Recently, I analyzed one hundred e-mails received from prospective students. 98 of them asked about mean, median, highest and lowest salaries of the previous batch. Only two had a question on the content of the program. Almost every school worth the name mentions quite prominently how the entire placement process was completed in a matter of hours. It is as if we are churning out products to be gobbled up by companies at the speed of thought.

    When I did my MBA almost thirty years back, teacher after teacher emphasized the importance of means vis-a-vis ends. In other words, while the maximization of long-term shareholder wealth was the flavor of those days, the role of managers as trustees of public wealth was constantly ingrained in our minds. Every lecture, irrespective of the domain, would have something to say on values and ethics.

    Somewhere along the line, we seem to have jettisoned the concept of value creation and switched over to enlightened self-interest. How else can one explain people leaving a job every few months in search of greener pastures? At the height of the IT revolution, a popular statistic doing the rounds was that the average tenure of a professional in an organization was 3.5 months.

    From being an art to a craft (Mintzberg), management appears to have become a business by itself. The rat race is getting to be more and more fierce by the day. Getting ahead of others by any means seems to be the only thing that matters. It is but a small consolation that many other professions have also been reduced to the same state.

     
     
     
    • Akhil Mehta

    What the author mentions about the behaviour of MBAs or managers is nothing but a manifestation of shareholders' behaviour. In these days and times when you see a plethora of controlling shareholders, led by the PE brigade, enter into a company only to earn maximum returns in the shortest possible time and then cash out, why fault the manager alone for being concerned with the short term?

    What we need is more entrepreneurial businesses that drive long-term objectives in a top-down leadership style.

     
     
     
    • Sathanam Krishnan
    • Dir (Courses) & Chief Course Architect, National School of Banking

    Dear Prof. Heskett, again I come back to the discussion forum. This interesting topic you have raised forces me to ask a pertinent question in this era of replicating business organization cultures - "Are these business schools meant to produce business visionaries?"

    While managing any business has become a routine, creating a distinct business vision and leading an organization on the envisioned path is a unique trait which is not taught in B-schools. At least it has not become a part of classroom case studies! Therefore,if we (read "potential stakeholders of business") expect all B-schools to be fountains out of which business visionaries flow, I am afraid we are on the wrong track. The flip side is, these schools are meant for generating managerial talent as professionals - like the British who designed collegiate education in India to have an abundant supply of English-proficient clerks!

    If business visionaries are created through these processes - I would tend to believe them as by-products of the process. It is interesting to note that competitive processes set in business force the stakeholders to change (sometimes unrealistic) expectations which should be met by academic institutions as ready-made solution providers!

     
     
     
    • Diomande Yantoulaye

    Increasing social responsibilities are required from companies and managers, who have to possess some type of knowledge that helps them put communities, societies and individual family concerns if not in the center, at one hand's length of their decision making process where choice must benefit both sides.

    B-Schools have fostered a sense of quantitative capitalism where the interest of shareholders seems to be unreconciliable with the interests of society. Understanding of social responsibility goes through a learning process that not only puts the stress on cultural/behavioral management but indeed reconciles the goal for creating a better life with the long-term sustainability of companies.

    Just look at the number of books being published about emotional intelligence, leadership wisdom, motivating people, etc. that are being bought by managers or people aspiring to become managers or leaders of other people! These books are just supposed to give them the ability of human feeling, of being able to feel, understand human subordinates, peers, and colleagues, and by the way impress the same by an "imitation" of simple human feelings!

    All of these contain informal knowledge and cannot be taught as maths or physics, but are as necessary as quantitative knowledge.

    The combination of these two elements, whether existing or not inside B-school alumni, widely determines the degree of their acceptance by "built to last" organizations. One side of B-schools, teaching process, is still incomplete until schools increase their capability to infuse informal knowledge pertaining to human beings into their alumni. And this is the challenge for B-schools.

     
     
     
    • Edward Hare
    • Retired Director, Strategy and Quality, Fortune 300 Mnf'r.

    "Business schools" are a business. They turn out a product they think the world wants or needs...usually defined as "professional" managers. The quality of such lies not only in their skills but also in their values and ethics. And those are shaped by their upbringing, aspirations, and societal values.

    Great "leaders" and "visionaries" often don't need an MBA. They are driven by an idea first and foremost. And proving the rightness of that idea is their goal. Getting rich is often far behind. In contrast, the "professional" managers I've come in contact with are driven by "getting rich". You can identify them by noticing that they make things up as they go. They have no idea they can call their own, not really. Yet....so many reach the highest echelons of business.

    I'd be reluctant to blame the business schools. They do what they do and give students tools. But they rarely can teach motives, ethics, and ideals. To me, our executives and business heads are simply a reflection in the mirror of our societal values. And as many have observed.....it isn't a very pretty picture these days.

     
     
     
    • T. V. Navin Kumar
    • Business Analyst, CSS Corp

    At least to me the most glamourous title you can ever get is an MBA from Harvard or Insead. But my question is "why am I so fond of it?" I might as well study in some local college in my own country. With all these aspirations, to "Did I apply to Harvard or Insead?," the answer is never.

    I know, I am contradicting my own ideas, but reader please proceed reading....though I would love to earn those $200,000 figures as my first salary I would also need to pay $80,000-$90,000 to Harvard or Insead.

    The point I am driving towards is, if "elite" MBA institutions are anything but teaching great business and leadership qualities to graduates, they should be charging say $10,000 and not mind about what their students are getting in return. In a sense, "elite" institutions run business these days in addition to teaching young students business.

     
     
     
    • D. P. Dash
    • Associate Professor, Xavier Institute of Management, Bhubaneswar, INDIA

    Writing from an Asian background, I would like to put on record what I consider to be the chief contributions of business schools:

    (a) they offer a substantial vocabulary to speak about the world of organisations -- thus enabling the participants to think on a variety of tracks vis-a-vis organisational issues/experiences,

    (b) they offer an opportunity to mould one's analytical and interpersonal skills to fit better with the prevailing conditions of organisational work-- thus enabling the participants to work and interact with greater ease in organisational settings, and

    (c) they offer a safe and fertile hideout for "academic guerillas" -- thus enabling these academics to expose the incomprehensiveness of all systems, practical or logical, institutional or scientific.

    So, in spirit, the business school is more in tune with the idea of extending the individual's competence and freedom, while treating the organisational systems and missions to be adaptable -- not cast in stone.

    As such, business schools constitute an extremely important countervailing institution in the traditional societies, for example, in Asia, where the individual's action and life-world are often severely dominated by traditional systems of power and privilege.

    In this context, the brand of management promoted by business schools may not produce a unique profession of its own, but it is more likely to serve as an important impetus for all professions (and other social institutions) to recognise the hidden powers and the suppressed possibilities of individuals with whom they work.

     
     
     
    • Dr. Hemjith Balakrishnan
    • Sr. Vice President (Strategy & HR), Health Prime Services ( I) PVt.Ltd

    Is management a profession like Medicine, Science and Law guarding larger societal interest than narrow private interest? Should management at the university level education be of the similar nature? Is it possible for management to be more societal keeping the interest of shareholder value also at the top of the agenda? Dr. Khurana asks with intense analysis and discusses a very pertinent and relevant topic in today's times.

    Are the business school breeding grounds of de-professionalisation of management? Do the so-called MBAs churn out good corporate citizens who are focused on creating wealth for the nation or are they forced to enact a mercenary role in concentrating only on shareholder value and achieving short term profits? We look back at the statements or rather proclamations made during General Electric's legendary CEO Jack Welch's time: "We live in a global economy. To have a fighting chance, companies need to get every employee, with every idea in their heads and every morsel of energy in their bodies, into the game."

    Is shareholder value the only value which industries need to create?

    At the micro level too, we more often come across teams at whatever level operating on one hand appearing to be collaborative in actions but at the same time face difficulty in fighting internal competing spirit (who is better than others in the team?) Further deteriorating basic values and the concept of ROI being on top of the MBA graduates' agenda (due to the resources they have put in both - time and money) forces them to draw plans for "self," making it more of a value driven out of hedonistic focus rather than a utilitarianistic approach for the larger interests of the society.

    However, hopes don't diminish while we witness attempts organizations are making by way of "corporate social responsibility" which should be more vehemently pursued through the curriculum level for us to see emergence of business as a legitimate function to transform society.

     
     
     
    • Cristina Zamfira

    I would like to give an answer (in fact my opinion) to the question posted by Ulysses U. Pardey, at no. 26: "We cannot solve the problems that we have created with the same thinking that created them" --Albert Einstein.

    I think that this affirmation is "logical" (even it may seem it as a paradox), because if we could solve problems (in general) that we have created with the same thinking that created them it means that we practically have no problems, or in any case not real problems. If we create something in one way (everything) it should be "destroy" in the same way and with (about) the same effort. A conclusion of that statement I think is that we should try to solve our problems -- and that can be especially apply to business, technology, R&D and science -- in a more uncommon way, or to "share" them with other peoples which may think at that problems in a different way and even solve them.

    Best regards,

     
     
     
    • Anonymous

    Is management being "de-professionalized"? Viewing the selection practices for and the salaries of C-level executives, one shouldn't assume that conclusion at all.

     
     
     
    • John B. Glassie
    • Marketing Associate, The Anspach Effort, Inc

    The art of Management and Leadership are fading because they lack translation into a quantitative business world. Management as mentioned earlier is more of a craft of Emotional Intelligence (EQ).

    Students at B-Schools are not encouraged to embrace their intuition. Management practices are hard to qualify; therefore, students do not feel comfortable stepping into that zone of discomfort.

    Many organizations are still focusing on 90's style management through Finance. If you read through job postings, the primary criteria for entrance is based on technical skills. Generally, only the technically competent are selected. Finance and It are not the only professional skill sets seeing significant growth; Law students are also on the rise because the degree provides a qualified translation into a career. These qualifying translations provide a necessary pivot for entrance into the business world- a world where the future is limited to the here-and-now.

    Few instances in the near past provide evidence to suggest that management and leadership candidates will rise to the top or even get their initial opportunity; this barrier discourages growth in crafting of managers and leaders.

    As for myself, I am working on a Masters of Science in Leadership. I have a Bachelors in Management. Within my current organization, their is not a position available for me to grow into. Therefore, upon completion of my Masters, I will need to work on a degree that hones a specific skill set other than Leadership.

     
     
     
    • Gerald Nanninga
    • VP, Retail Ventures Inc

    Two Points:

    Point #1: If you want to understand what is wrong with elite business school education one only needs to look at the other articles attached to this week's HBS Working Knowledge Newsletter. Here are the titles:

    "Modularity, Transactions, and the Boundaries of Firms?A Synthesis"

    "Strategic Interactions in Two-Sided Market Oligopolies"

    "Intra-Industry Foreign Direct Investment"

    These papers are virtually unreadable to the average businessperson--full of unfathomable math or endless academic footnoting. What in any of these articles would help build better leaders, better visionaries, or better managers?

    The elite schools are designed for accomodating academia, not management.

    Maybe business schools need to be separated from universities and be treated more like trade schools.

    Point #2:

    The business world has changed considerably in recent years. Computers and the internet have made obsolete many of the tasks formerly held by middle management, which was to coordinate the two-way information flow between the top executives and the labor force.

    In addition, in an information/knowledge-based economy, less of the work of management has to do with managing large pools of low end employees. Organization charts are very flat. People work in educated teams, where sometimes you are a leader and sometimes you are a follower.

    We need a new type of business person, one who not only can manage, but one who can actually do some of the knowledge-based work. Full-time people management is becoming a smaller part of the mix. You must personally add value to business. This requires knowing more about the business you are in, something business schools tend to ignore.

     
     
     
    • Sethakgi Jack Kgomo
    • Chief Executive Officer, Nkhumishe Kgomo Management Services & Investments, Johannesburg, South Africa

    First of all, the critical question to ask is "relevance" of Executive Education provided by the B-Schools. If the B-Schools truly exist to fulfill the economic law of supply and demand, it therefore follows that the question being asked would be superfluous. This brings a question: For whom and for what are the Business Schools educating? What would be the "opportunity cost" should executives of many firms not attend b-school courses? If B-Schools merely provide the type of education that purportedly or presumably satisfies the factual demands of commerce and industry without a proper empirical basis of what their actual (not presumed) "clients'" needs are, then the hypothesis you have stated sounds correct.

    Secondly and importantly, the Executive Education needed by companies should insofar as possible be more focused and nuanced to address the macro amd micro issues facing businesses in the face of globalisation drivers (the macro side) and then the specific aspects in a specific market (the micro factors). Generally I believe most b-schools have ample capacity to carry out these tasks. But that would not be enough if Exec. Education lacks "customization" of courses.

    "Customization " of Exec Education in this context means the creation of alliances between b-schools and particular industries or specific firms to address common (and core) needs of that industry or firm and making it a "customized" course. Courses that are customized to particular industries or firms are more at "coal face" to addressing "real live issues" than those that are what one could call "one-size-fits-all". We, as business people, are more concerned in the derivance of value from any investment we make, including investing in the development of our employees.

    Executive Education that lacks a closer correlation with the "customized" needs of companies would be viewed generally as an investment not worthy of undertaking again. We need to have the quality of b-school education that is "outcome-based," which has a direct impact on the bottom-line of the business, in terms of addressing specific problem areas peculiar to that firm or industry.

    In the final analysis, the deprofessionalization of management as a hypotheisis would be disproved if b-schools start conducting and positioning themselves as "true" suppliers of an essential service to clients (companies & firms) without whose supply the welfare of organizations will be harmed or be at stake.

     
     
     
    • Maureen
    • Student/retired, n/a

    Although business exists to increase shareholder wealth this goal should be strongly linked to corporate social investement as the unjustifiable excessses of wealth generation in business today have brought about a greed in management level that far exceeds any attempt at professionalism.

    This greed is symbolic of lack of leadership and an unethical basis for existence. Therefore business schools that want to provide a "professional" manager should incorporate leadership and ethics training in the curriculum.

    As a student of management leadership I am disappointed that business schools still insist on group assignments in the face of known cheating or in rewarding all group members with the same results without the same input. This is a weakness in the training and in fact promotes a sense of "it's okay to act unethically." One wonders where this takes the future of business?

     
     
     
    • Anonymous

    In the South African context, I think universities should be more selective, rather than use the cheque book as a major criterion for entry. Having lectured on MBA programmes, I find that too often the people on the course have no idea why they are there! Most have no intention of rising through the ranks into senior management. Even the bulk of the students who did their MBA's with me either never passed, or are in the same position with the same business 5 years down the road. If that does not lead to a lack of professionalism then I am surprised. They simply see the MBA as a means to achieving higher salaries. They have no passion for business and could not lead a flock of sheep.

     
     
     
    • Anonymous

    To people who are better acquainted with global issues beyond business only - this discussion sounds like "while business is consistently destroying our planet - shall we have short-term vs. long-term management focus"? I am often amazed by the shortsightedness that reigns in the economy. We seem to entirely forget that only in a few decades from now our children may struggle to physically survive, and not to create long-term profitable growth in business.

    All the agencies doing research in future trends show that the dominant emerging trends are namely in the area of searching for sustainability and deeper meaning rather than just money and profits. Isn't it time for the elite business schools to catch up with that and adapt their programs accordingly, rather than just raising some smaller-scale issues along the way?

     
     
     
    • Patrick O'Rourke
    • Consultant, Breffney Coaching n Consulting

    Any Business School programme, elite or not, aims to equip the graduate with the relevant knowledge, skills and tools.

    The accumulation of a 'body of knowledge' on any subject is the hallmark of it becoming a 'science' and this was the pathway that lead to management gaining credibility as a science. The formational of management-related professional bodies followed, which in most cases lack the regulation and control exercised by more traditional professions like law and medicine.

    This being the case, how Business School graduates choose to practice their 'profession' in the business world remains very much unhindered if within the law and all the MBA courses on business ethics will not substantially alter that.

    Let's forget about striving to gain acceptance as a profession in the traditional sense, as we are not comparing like with like. The French term of 'cadre' may best accommodate the reality of business practitioners in a modern world.

     
     
     
    • Tery Tennant
    • Partner, Attainment, Inc.

    In studying for my MBA something became quite obvious to me. While I was schooled in lots of wonderful ideas about things like the progression of management theory, strategic thinking, and even leadership, the real application of what I needed on a daily basis was sorely missing. That is, how to actually apply things like effective delegation, setting and communicating goals, using authority well and properly developing the "greatest asset," was astonishingly missing. Therefore, it is a common joke in many circles that MBA grads know little of real-world needs and practice.

    It's a little like high school graduates not being able to do practical things like balancing a check book, grocery shopping or paying bills on time. B schools do a fine job of teaching many of the mechanics of business systems and the numbers, but often fall short on the people side of the game. In other words, they teach management systems adequately, but I question how well this translates into effective leadership. Good leadership ability is, of course, much more than systems-based head knowledge.

    Efficiency doesn't equal effectiveness. If I weighed a MBA degree from an Ivy League school (or any other B school for that matter) against being able to apply good, basic, working leadership principles - I would usually prefer the latter for maximum effectiveness in running a business. Hire the MBA to set up and monitor systems, but develop them with good coaching in hands-on leadership before turning them completely loose to lead people!

    If B schools could graduate people knowing how to do these things, it would be a completely different story. Knowing management systems is not what matters most - knowing how to lead people effectively towards the goal is what matters most.

     
     
     
    • Tery Tennant
    • Partner, Attainment, Inc.

    One other thing I would mention in this discussion (which I forgot to say above): While B schools have program advisers from the business field, the professors themselves are not likely to have spent time actually running a business (or even a department). It's a lot easier to learn management systems from a text book, but leadership skills are something that has to be appreciated and developed in interactions with live people. Accordingly, professors may not be attuned to the importance thereof, and therefore won't place adequate emphasis on students acquiring genuine leadership skills. Again, they've missed the importance of focusing (in practice) on the most valuable asset, i.e., what people really mean to an organization and how to effectively accentuate human relationships.

     
     
     
    • Nandan Vaidya
    • HRD Professional

    MBAs are not professional in the sense we would refer to Doctors, Lawyers and Chartered Accountants.

    Reasons: 1. No one has ever lost MBA degree/affiliation for not adhering to professional code of conduct. Other professions do. 2. MBA graduates tend to give exclusive preference to expectations of their customers of their pay-cheques (customer in minds of MBAs are their immediate superiors, senior management and shareholders!!!) than their own independent professional judgments. Imagine a Doctor considering interest of hospital shareholders & management more paramount than his own independent assessment about patient. Imagine a CA (like in case of Enron) considering it more important to listen to "top management" than his professional ethical code of conduct / inner-conscious.

    Some interesting trends emerging are; 1. MBA was necessarily of industrialized economy with tall hierarchy. It supplied labor with requisite attitude to do planning, organizing, communicating, managing social networks, etc. My metaphor for these skills is "oiling the machine" skills. These are not key ingredients of value-addition that end consumer are ready to pay for but a necessity to keep large machines moving smoothly. 2. Instead of few very large organizations doing everything in-house, I see a trend towards many small specialty firms working in interdependent relations. Large machines are being replaced by many small machines. IMHO, in such scenario domain expertise would be at high premium than managerial skills. In some IT start up Project/program manager is paid lower than skilled programmers/architects. Though, structurally programmers/architects report to the project/program manager. 3. In new Knowledge and service economy, information and decision hierarchies are very flat. Almost all information is available to everyone in the organization through searchable databases. This has greatly reduced need for "oiling the machinery" skills. 4. Management consultancy and financial firms have been traditional patrons of MBAs. In last 15 years, large chuck of job opportunities and market capitalization has been contributed by Technology and service industry. Interestingly these industries are not active patrons of MBA graduates. Ex PEPSI co. CEO almost ruined Apple Computers until "man in faded jeans" came back with new innovation. MBA CEO hired by HP almost ruined its long successful history. (Read Henry Mintzberg - Managers not MBAs).

    Irony of all this would be, MBA schools would continue to supply manpower to non managerial jobs like financial analyst and consultancy.

    I think format of MBA schools would change to either; - Management development institute (for industry sponsored candidates who would be largely functional experts wanted to broaden business perspective). - Entrepreneurship development (self or VC sponsored) - Super specialty diplomas (compensation expert as against general management). Again a domain expert and not general management that MBAs are suppose to be.

    As a product of MBA School, it is interesting to pause and look back at emerging reality in contrast to perceptions/expectations I had at time of joining the MBA course.

     
     
     
    • Marc Schoenen
    • Finance Manager, Google

    My experience is that "Built to Last" corporations are too slow to respond to changing market conditions, and instead focus on process. Basically agonizing a slow death, an inability to respond and failure to change. Having worked for at least two Built to Last corporations in prior lives (GE and Deloitte), I am happy to be at a company now that welcomes change, embrances tomorrow instead of yesterday and is willing to re-invent itself on a continual basis.

     
     
     
    • Mehmet Genc
    • Assistant Professor, Baruch College

    I am not sure how the book makes its case. But similar things have been said by others before (the late Sumantra Ghoshal and Henry Mintzberg for instance), who lamented the quantitative emphasis at the expense of "professionalism".

     
     
     
    • PAL HBS '71

    I find posts #29 and 63 relevant to the question of professionalism. The concept of management as a profession will require either self regulation or governmental regulation. When HBS strips someone of his/her MBA, that will be a start.

    Here are a couple of other thoughts, less important than the above.

    When I invest in stocks, I am influenced by Warren Buffett and similar minds who look at the quality of management as well as the business model. I wish it would be easier to assess managers than it currently is.

    I agree with Post #31 - find people who can do the job you need to have done, respect different work roles, work together cooperatively, and share the rewards.

     
     
     
    • Cristina Zamfira
    • Romania

    First of all, I think management can't and shouldn't be a profession like medicine, law or engineering unless or if we refer to management as a part of economics. This is because practical management, in general, is probably more complex than the above professions and it is unlikely and maybe inefficient to specialise management more than currently.

    In both medicine and law, for example, people who we refer to in general as being "professionals" are often specialised. They know best only one part of that profession.

    But how can we specialise management science and how can we be specialised in managing a specific type of company or acting in a specific industry ...? As someone said here, "Selling drinks is not the some as selling computers." Without mentioning the problem of how to work with third-world economies.

    Second, I think elite business schools participate at the same time in the professionalization and deprofessionalization of business, markets and economies. How?

    They professionalize business and management by giving students skills which would allow them not only to become managers or leaders, but also could help them make better decisions in professional life.

    But they also deprofessionalize the management in a lot of circumstances and subjective situations. Because some MBAs may expect too much too quickly, professionally and financially; because a lot of companies may believe that it is not necessary to work with an MBA while there are successful people without an MBA. It may deprofessionalize because some of the MBAs are indeed too theoretical in their problem-solving solutions, or too focused on a quick paycheck and the short-term gain of companies.

    On the other hand, business schools should be more interested in practical skills gained by students; but they can't be the only responsible for students' skills.

    Still, that doesn't mean business schools are not doing good work. I think they are. Just that in an imperfect world -- with imperfect people and imperfect MBAs from whom everybody expects more, there are a lot of things that could be done. I think one of the easiest and inexpensive, ... is what some call "open knowledge." I am referring here to the possibility of putting questions -- including about business, technologies, science, research and development -- to "everybody" in blogs, forums and others like that, and answering, criticizing, and giving suggestions.

    Best regards,

     
     
     
    • Nitin Pujar
    • Managing Partner, MACRO India

    Becoming an MBA by itself does not mean entering a profession, it is a qualification, thus discussing 'deprofessionalisation' is a bit presumptious. Has it reached the state of being truthfully refered to as a 'profession' in the first place ?

    In the US it has allowed candidates to enter the job market at certain positions and levels that were higher than the benchmark entry-level at a given point in time. In other parts of the world it does not exist even today. Where do business leaders come from in say Russia or Germany or Japan or say Vietnam? Are Managers there 'unprofessional' or 'deprofessionalised' ? Interestingly the leading management program in India is 'Diploma' in Business Management. So does India feel business management is a 'vocation' ? It may be mere semantics.

    The fact is that management education has not evolved enough, both academically nor through its wide common application in various societies like say medicine has ( from Russia to Cuba to Africa to Mongolia). This is not to submit that it has failed in any way, but merely that it still has a long way to go.

    For a profession to evolve it needs to be a service that is recognised, needed and practiced irrespective of the governance system or the fiscal health of that system.

    It is just the beginning, and it is a journey. It needs to evolve and this debate is in the right direction, but one need not write off the successes of millions of qualified managers just because they got too busy making a career out of their MBA. It is the Business Schools that need to build a structure that will enable the morphing of today's disparate MBA qualification landscape into a Global Profession.

    Are the Leading Schools willing to do it beyond networking with Alumni Associations and Chapters limited to their own?

     
     
     
    • John Mauriel
    • emeritus professor, Carlson School of Management, University of Minnesota

    Besides complexity and the fact that some significant intellectual knowledge is needed to practice the art or science, other requirements for an vocation to be considered a profession is that there exist an organized body of knowledge that is taught and learned and a standard of ethical practice to which members of that profession are committed. There does not seem to be agreement among business or management schools as to what the basic body of knowledge that must be learned by all students is. I am not sure even what AACSB accreditation in the US means in terms of what is actually taught is precisely documented. As to the ethical standard, there is no counterpart to the Hippocratic oath of the medical profession. Business School deans or some body must agree on an ethical standard that can be documented, observed and sanctions that would be applied to those "professional managers" who do not live up to the standard.

    As Mr. Pujar has stated about the professionalization of management, "it still has a long way to go."

    Finally, what would be the responsibility of corporations, of corporate directors, etc. to see that there is some professional oversight over businesses in terms of assigning management responsibilities and providing accurate operational and financial reporting? Although people can take patent medicine or apply a popular cure advertised on TV without seeing a doctor, typically only the individual bears the consequences and responsibility for such behavior. When an executive mismanages corporate resources or engages in other unethical management behavior then stockholders, employees, customers and communities may suffer the consequences. As Ms. Zamfira commented earlier, "practical management, in general, is probably more complex than the above professions" referring to law and medicine. So how do we protect the stakeholders of corporations, other than by law and regulation? Would we really want management positions to be available only to those who pass certain exams, such as is true in other professions? What then would we do with the bright but lesser educated entrepreneur who invents something very valuable to society and builds a company to produce and distribute it?

     
     
     
    • Sashikant Mohanty
    • Management Consultant

    My comments are without offence to anyone in specific, and are observations based on fairly diverse data points.

    Extracts from Khurana's works cite that the field of "Management" was conceived to build pool of professionals with specific knowledge integrity , and with an ideal of service. Go to any "elite" business school, and validate if the students' objective ties back.

    "A Leader is one who knows the way, goes the way and shows the way" may have well become a cliche, but it is a quick acide test for products of so called elite business schools, and also for corporations that seek out for the "Elite" products. I agree completely that business schools can impart education in specific disciplines, but I suspect if that can ever be a substitute for a practitioner's skills. In that let us ask the basic question - does everyone who wants to visit a Business school want to become a a Leader, or a Manager?

    The measure of how elite a school is often the best compensation offred on campus through placements. Management education from elite schools particularly in Asia-Pacific, if not world over, is clearly perceived to be a quick way to making big bucks. So, without offence to my friends, I strongly feel justifying 6-figure salaries as a way to making up for cost of management education is a poor alibi. The fact is often people turn to business schools without exposure to professional environment.

    When joining schools, most aspirants establish their keenness in social work. Do they exhibit same level of commitment while in school, or beyong that? How many business school graduates want to manage issues of the society? How many manage challenges that future generation is exposed to? Where is the ideal of service? Is this not relevant in today's world?

    In this part of the globe, teaching, research, medicine or legal professions haven't been attractive career options as management. The reason is pretty obvious: they are not paying enough. It is not based on aptitude, interest that the youth want to notch up a management degree. I see what I term the bandwagon culture, taking the youth by storm.

    I have a bigger apprehension for the future: we would see a class divide based on whether you have a management education, or not.

    Even in contemporary world of business, if net worth (not inherited) of individuals is a measure, then most successful people world over may not have been "Elite" business school graduates. And indeed may also be teaching the principles of ethical business and professionalism to the world.