“We should take care not to make the intellect our god— it has, of course, powerful muscles, but no personality— it cannot lead, it can only serve.”
– Albert Einstein
– Albert Einstein
How Business School’s Lost Their Way
I was struck by the authors’ insights in the article, “How Business Schools Lost Their Way,” as I went through my MBA program. Upon reflection, I believe the article resonated with the sometimes-heated dialogues I had with Art Seiler (lifelong learner with a razor-sharp mind who had seen and survived much) on the business/philosophical topic of the day before he passed away.
The above-mentioned recent article in the Harvard Business Review succinctly explains:
[Today,] Masters of Business Administration (MBA) programs face intense criticism for failing to impart useful skills, prepare leaders, instill norms of ethical behavior—and even failing to lead graduates to good corporate jobs. These criticisms come not just from students, employers, and the media but also from deans of some of America’s most prestigious business schools, [… citing the] main culprit is a less-than-relevant MBA curriculum. (Bennis & O’Toole, 2005, May, p. 1, emphasis added)
Art Seiler would agree. I recall my conversation with Art after the Enron scandal broke. Having successfully taken 30 failing companies to profitability through turn-around change strategies in his career, Art was perplexed. He found it hard to understand how an accounting firm such as Arthur Anderson could be involved, how so many executives would go along with “corrupt practices” without taking a stand and, ultimately, allow the demise of so many innocent people. He shared how his accountant would have addressed him (the CEO) with a swift “knock upside the head” and his resignation if Art had ever crossed that line. Art counted on that; he trusted that if he ever got caught up in politics, power or ambitious drive, that his accountant and others within the leadership circle would call him out.
“The job of the CEO is to listen to his people.” Art would say, “If they don’t tell you the truth, especially when the truth is tough to share, you shouldn’t have them there.” Art also shared with me a situation in which he chose to do things his way, to ignore what his people were telling him. It was a several-million-dollar lesson—one which he never forgot. He shared, “some people are really great vice-presidents, but make lousy CEOs.” Puzzled, I asked why.
“First,” he said, “They don’t understand money, how to make it, keep it and how to keep making it.” Understanding what drives business is essential to success. Art pointed out that vice-presidents who move through the ranks as subject experts, with limited practical experience working horizontally within an organization, will crumble under the weight of the CEO’s responsibilities.
“Second, they don’t make the tough decisions early and often enough.” The inability to act quickly and often undermines leadership effectiveness. Art explained that turning the course of a company takes a series of tough decisions based on a successful corporate strategy. This parallels the thought, if you don’t know where you are going, how will you know when you get there?
“Third, [which he believed was the worst of all] they let their egos get in the way and stop listening.” Art explained that years of paying ones dues and moving through the ranks creates a strong sense of self within evolving vice-presidents; this is critical to being a successful CEO. However, when surrounded by yes-men and -women, a CEO will be isolated from real, unfiltered honest information and feedback.
With a strong leadership team who will tell the truth in every situation, especially during tough critical moments, a CEO will make the right decisions (most of the time). The key is to surround oneself with quality leaders, learn to ask questions and listen. Art’s failure to listen to his people cost the company millions of dollars, a CEO lesson he remembered and utilized during the remainder of his career and into his mentoring years.
Understanding business drivers, making tough decisions and learning to listen are applicable to all business, even the business of graduate business education. Being in charge of a classroom or a graduate business school puts a professional educator in a CEO-like position, as success and failure depends on his/her leadership among perceived subordinates. These subordinates are adult business practitioners who bring a wealth of experience to the classroom, which unfortunately is not tapped consistently by those in charge of the learning environment.
Through empowerment and proper channeling, professional educators have the ability to plant and/or cultivate the principles of lifelong learning in a classroom setting.
Bennis and O’Toole continue:
[the] actual cause of today’s crisis in management education is far broader in scope and can be traced to a dramatic shift in the culture of business schools. […] Instead of measuring themselves in terms of the competence of their graduates, or by how well their faculties understand important drivers of business performance, they measure themselves almost solely by the rigor of their scientific research. […] Some of the research produced is excellent, but because so little of it is grounded in actual business practices, the focus of graduate business education has become increasingly circumscribed—and less and less relevant to practitioners. (Bennis & O’Toole, 2005, May, p. 2, emphasis added)
The life blood of any educational institution is students. Without students, the university system would not exist. The University’s hope is that successful alumni will contribute gained wealth back to support future generations. Often, graduate students are perceived as vehicles for research, to the benefit of academic professionals striving to meet research requirements for publications in academic journals for tenure promotion. The more one publishes, the more likely one is to become a permanent member of the university community.When business schools do not measure their success on the quality of their graduates, and build relevant research grounded in actual business practices which is applicable within the general business community, the body of knowledge suffers from a practitioner’s standpoint, as does the quality of business education.
In my mind, research conducted by a business practitioner can and should be different than research conducted in the hard sciences, such as chemistry, physics, etc. In the hard sciences, one starts with a single hypothesis and then seeks to prove or disprove that statement— essentially proving or disproving a strong correlation between variables identified through the hypothesis proof process. While very important in basic research, such a method is hardly meaningful in business practice, as real-life problems are not always solved through research on one piece of the puzzle. Business problems often draw on multiple disciplines inside and outside of the normal business curriculum. As one begins to solve the perceived problem through action; one sees new variables surface that may also need to be solved to facilitate arrival at the desired state.
To better illustrate this point, I am reminded of a particular conversation I had with Art a few weeks before he passed away. He was in stage-4 heart failure, having survived 18 months longer than most in that condition. His eyesight gone, he asked me to read the newspaper to him.
The article that resonated most with him that day was about building a technology/business park in Missoula, Montana. The article was supported by several scientific studies, including impressive facts and figures. It pointed out all the reasons why this would be the “next best thing” to turn around Montana’s declining economy. Without missing a beat, Art went on to explain how ludicrous the idea was that this one thing would solve “it”—citing countless reasons for business failure, including location, the lack of developed infrastructure and the lack of quality leadership.
The part that really frustrated him was that developers were trying to persuade the public using facts and figures—rather than a viable business strategy supported by evidence. As an engineer and business practitioner, Art understood hard science; yet, he emphasized the need for quality strategy and solid planning based in research and grounded by the realities of business.
For me, understanding the Porter 5-Forces model is a benefit of my MBA education. Yet, while I agree it has its place, I can not conceive of a single time I would draw the Porter model on a white board with my colleagues in a boardroom and check the boxes to see if our proposed business strategy meets Porter’s idea of the world.
In my experience, if a newly minted MBA attempted such a thing, s/he would be laughed out of the room. Yet, this is how we are taught in business schools. We are taught to regurgitate the information that our instructor deems valuable to know—even if that instructor has never stepped foot in an actual business setting, other than as a customer. Clearly, there are countless exceptions—academic professionals who provide consulting services within corporate situations, or have transitioned from practitioner to academic professional. And, justly, these professors stand out to MBA student practitioners as hands-on experts, as they actual engage in maintaining relevance through practice. Yet, it is very common in graduate business education to be at the mercy of business educators who have never worked in corporate or industry settings, who profess to be experts.
Professional educators who do not maintain business relevance through practice set unreasonable expectations in theory which have no perceived relevance to current business issues. Many professional educators become too comfortable within the walls of academia by tenure protection. Over time, this complacency drives out the edge which comes from the uncertainty which is the basis of life.
My generation is expected to have 5 to 6 careers within a lifetime, which yields a career move every 3-5 years. In the face of uncertainty, the human brain evolves and finds either new ways of processing information and doing things or merely locates the next job doing the same thing at a different place of employment. Yet, as CEOs in the classroom, professional educators determine your grade, and (in my experience), often see nothing wrong with using out-of-date or ineffective teaching methods and course content in the classroom. It is not uncommon to be presented material decades old—which has little or no relevance to the evolving business landscape. Such neglect clearly demonstrates that lifelong learning is not required to maintain status as an academic expert; in many cases, the material used in the classroom comes from one’s dated PhD dissertation research.
As a practitioner, I’ve never received “a grade” in the business world. I’ve made a lot of mistakes and received positive and negative feedback along the way. I’ve received raises and recognition for a job well done. I’m evaluated on performance and product, which are tied to what I managed to get done in less-than-perfect situations with less-than-perfect information and to how much I am valued as a member of a contributing team. Sometimes I miss deadlines; then, depending on whether or not the deadline was hard or soft, consequences follow.
In business, the landscape is always moving; often, issues are overcome by events. Though one can identify similarities between the academic world and the business world and can draw on those parallel experiences, unless one has experienced real uncertainty and navigated it successfully, one cannot profess to understand current business practices. Indeed, how can professional academics who chose not to evolve understand how best to guide practitioners learning to apply solid business theory to actual business reality?
Allow me to clarify: the business theory in graduate business education is very important to bring a businessperson, such as myself, to a higher level of understanding. But such theories must be relevant outside of the classroom or they will not stick, nor will anyone ever benefit from the real purpose of the MBA education process.
Bennis and O’Toole point out:
Business is a profession, akin to medicine and the law, and business schools are professional schools. […] Like other professions, business calls upon the work of many academic disciplines, […] including mathematics, economics, psychology, philosophy, and sociology. The distinction between a profession and an academic discipline is crucial. (Bennis & O’Toole, 2005, May, p. 2, emphasis added)
The practice of business is as much an art as it is a science. Of course, to be successful one must understand business drivers. There is much more to it than merely explaining accounting or finance principles. When a plan or deal comes together, there is an elegant beauty in the pieces that come together at the precise moment to make or break a deal. While I believe, educators and students alike recognize the difference between theory and practice, homework and reality. The real disconnect is in the space between practice and theory, the place where brilliance and finesse exists. Educators that know how to align what they teach with what a student will soon be experiencing in the field are invaluable within the academic community. Art Seiler was just that kind of teacher.
Having completed his undergraduate degree in engineering from Montana State University and later receiving his graduate business education from MIT, Art would be the first to agree. When I became disillusioned by the business world, I resolved to return to graduate school, to change my career path and become a professional educator—believing that I was on the wrong path and needed to take corrective measures while I was still young enough to do so. Art questioned my choice, asking me why I would give up everything I had learned to that point to take a seat in the bleachers? Evidently he believed the old adage, “Those that can, do. Those that can’t, teach.”
Don’t get me wrong; Art supported education as a strong advocate of the need for higher learning. He believed that individuals that chose a career as professional educators should hold themselves to the highest standards and should continue to practice lifelong learning so they could continue to guide future generations through personal example. Thus, his issue with education as an institution is that it doesn’t live up to its own standards; he felt it breeds complacency in those who preach the word, so to speak.
Thinking back to that conversation and recognizing where I am now I can see some things more clearly. I believe that feelings of accomplishment or success have less to do with the career or job one chooses and more to do with how an individual chooses to perform in that endeavor. Passion for what one does seems to be a key ingredient for success, no matter the profession.
Bennis and O’Toole seem to agree with Art. They explain where business education drifted off course and what needs to be done to catalyze realignment:
By the end of the twentieth century, nearly all the nation’s leading business schools—the two dozen or so elite MBA-granting institutions and another dozen schools fighting to join the highest echelon—offered a curriculum of academic distinction. But, in the process, their focus switched, and now the objective of most B schools is to conduct scientific research. Going back to the trade school paradigm would be a disaster. Still, we believe it is necessary to strike a new balance between scientific rigor and practical relevance. (Bennis & O’Toole, 2005, May, p. 3, emphasis added)
To restore the proper balance between scientific rigor and practical relevance requires an asserted effort by the academic community collectively. Leadership within the ranks at all levels must address relevance in curriculum, classroom delivery and quality research grounded in business reality.
