Schools look at ways to put their house in order

attic

Schools look at ways to put their house in order
By Della Bradshaw
Published: January 17 2003 18:42 | Last Updated: January 17 2003 18:42


In September 2002, Stanford professor Jeffrey Pfeffer caused uproar in the business school world by questioning whether business schools were delivering what MBA graduates and corporations wanted.


The article* from a professor at one of the world's top business schools brought sharply into focus many of the fears prevalent in US business schools, following one of the most disastrous years many faculty and staff there can remember.

Many were already beginning to question their values and modus operandi. What should business schools be teaching and how should they be teaching it? Such questions shook the bedrock of the business school world.

As the Enron and Worldcom scandals broke, many of the executives, it was revealed, were graduates from some of the biggest brand name business schools - most notably Jeff Skilling, Enron chief executive, from Harvard.

Graduating students, having spent two years and hundreds of thousands of dollars in getting an MBA, suddenly found the only job they could get, paid less than the one they had quit to go to business school in the first place.

Data collected for MBA2003, the FT's ranking of full-time MBA programmes, shows that last year nearly 12 per cent of graduates from the top 10 US schools were unemployed three months after graduation, compared with fewer than 8 per cent the previous year.

Moreover, uncertainty in world events has meant the globalisation of business schools, so prevalent over the past decade, has now been put on hold.

Can the US business school as it exists today continue to thrive? Like Prof Pfeffer, many US academics question this most basic of propositions.

Now is the time to rethink completely the way business schools work, says Robert Sullivan, who quit his job at the Kenan-Flagler school at the University of North Carolina at Chapel Hill at the end of the year to become the dean of the new school at the University of California, San Diego.

His views are not surprising, perhaps, given his task of creating a differentiated business school from scratch.

He is, nonetheless, one of the most thoughtful of business school deans. Nor is he the only one considering such issues - two of the top US business schools have already asked him in to speak to them on his views. "Top schools want to do the extraordinary, but it is hard for them to change," says Prof Sullivan.

Prof Sullivan questions the accepted wisdom that MBA applicants need seven years of prior work experience. And he questions the value of a two-year programme because of the opportunity cost.

Much of the structured learning that occupies the core courses of the first year of an MBA - business statistics, basic accounting, basic finance - can be learnt by using technology, he argues. "That's part of learning to learn." Classroom time should be spent teaching students to work in teams, to communicate and to persuade, he says. "This is where we would create the greatest value."

It will not be lost on European business schools that the move to a one-year model and to teaching "softer skills" in the classroom would bring the US MBA more in line with what has been happening in Europe for years.

He is not alone in believing that what is taught has to change. In Canada, Roger Martin, dean of the Rotman school at the University of Toronto, also holds strong views. "MBA education is fundamentally about model-chasing, identifying the model you have been given depending on the problem, as opposed to what it should be, model building - how to construct a model which is optimal for the situation."

Those MBAs who do well, he believes, are those who "can think across the pieces of the puzzle". He is optimistic. "I believe more and more that we can create a new generation of business education which is enormously valuable."

Amid all this turmoil, the big brand business schools are sticking to their guns. Patrick Harker, dean of the Wharton school at the University of Pennsylvania, consistently ranked number one in the Financial Times MBA rankings, is pursuing a back-to-basics policy.

"There is a call to return to the fundamentals," says Prof Harker, and he defends the traditional two-year model. "There are some things that are worth learning that are hard. Education is not information transfer: it takes time."

Dean Kim Clark says the Harvard MBA, number two in the FT rankings, has always been very close to business by design, and so any changes in business practice are "grist for the mill" in developing the MBA programme.

While he talks of technology and leadership skills as two planks of Harvard's ongoing development, he also cites issues of corporate governance and globalisation. In December Harvard opened its fifth international research centre in Tokyo the other four are in Paris, Hong Kong, Sa~o Paulo and Buenos Aires and this month Harvard faculty voted to develop a core course on Leadership Values and Corporate Responsibility.

Nor has Wharton buried its head in the sand. Faced with the prospect of unemployed graduates it is even considering using headhunters to get them jobs.

While business school staff regroup to react to the downturn in the economy, they find there are other areas where they have just as little influence, in particular US government decisions to restrict work visas for non-US nationals and student visas. Such moves could scupper US business schools' plans to become more international.

The concern is not just in the US. In Europe, too, several countries, such as Spain, have restricted work permits for non-EU nationals.

Just as in the US, European business schools are also having to deal with changes imposed by the economy and government. In particular, the European Union has ruled that all university education should be completely overhauled based on the batchelor and masters degree system prevalent in the UK and the US the European model frequently calls for undergraduates to study for five years. Potentially the MBA degree could develop the kind of influence in Europe that it has enjoyed in the US for the past fifty 50 years.

The European changes have to be implemented by 2010. Eight years from now it will be interesting to see whether business schools in both the US and Europe have changed as dramatically as many now predict, or whether the more things change around them, the more they stay the same.

*The End of Business Schools? Less Success Than Meets The Eye, by Jeffrey Pfeffer and Christina T Fong; Academy of Management Learning and Education; published September 2002