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Tuesday, March 17, 2009

Just like Screwing for Virginity: MBA's and Retraining

A NY Times article has been making the rounds called, "Is It Time to Retrain Business Schools". The article points out how most of the Financial Company CEO's have MBA's and their ability in terms of leaderships and strong ethics ranks along with a monkey's ability to refrain from flinging its own poop. There is a feeling that MBA programs focus too much on analytics and not on the big picture application. To balance the article out, it mentions some curriculum where business schools try to integrate analytics into the business context so students can better apply these principles or emphasize leadership and ethics.

With regards to CEO's Behaving Badly having MBA's, that's more of a consequence of finance being a lucrative and popular field recently. If yak breeding suddenly developed a huge arbitrage opportunity, MBA's would replace their financial calculators with the Farmer's Almanac.

Business schools have been placing big bets on becoming experts in teaching leadership and ethics ever since I graduated. However, their ability to accomplish this is under attack and rightfully so. I think that MBA programs need to admit they cannot teach leadership and ethics and give up this tactic. One notorious Wharton student essay in the leadership class compared practicing leadership in a classroom to masturbating in order to become a better lover. Teaching leadership and ethics is falling into the realm of fighting for world peace or screwing to keep your virginity.

Despite all these efforts around leadership and ethic development, business schools have nothing tangible to show for it. From my admissions essay reviewing, the leadership and ethics essays tend to be the easiest for applicants to write as they are cookie cutter with a blindingly obvious approach. Thus, the essays fail as far as being an effective tool for screening for leadership or ethical potential. Most leadership opportunities in business school essentially involve leading your peers in consulting projects, learning team assignments, or to strip clubs. However, business school students are remarkably homogeneous in terms of work style and motivations. In most situations, someone has to lead a diverse group of education, backgrounds, work style, incentives, etc. While MBA students are a diverse group ranging from citizens of former Soviet republics who work in oil fields to blue blooded bankers to Save the Whales non-profit gurus, their learning approach, incentives, and approach to problems is all very similar. Thus leadership exercises become a demonstration in self-pleasuring (okay I have to stop with the sexual references. I still think that I am writing a dating post).

With ethics, MBA programs introduce the topic, have a class, and there is often really fun philosophical discussions. However, implementing ethics into the business world is a larger more societal issue. I work in a non-profit Catholic health care system so my ethical direction from my organization is very clear. To make it even clearer, a nun works 50 feet away from me. Someone has to evaluate their ethical framework every day in a new situation. Therefore, a class 5 years ago is not going to provide the knowledge for each specific situation. For example, I will sometimes attend competitor sessions or use their applications to research their products and performance. Each time that I do it, I have to conduct a different ethical review based. I barely remember my ethics class let alone having any tools from it. I would rather just ask the nun.

It's time for an Exit Strategy. Human Resources bloggers are talking about what their industry is really good at in light of a recent critical article and it's time for MBA programs to take the same approach. I think that schools recent curriculum reforms are moving in the right direction but it's time to cut losses.

  1. Stop pretending to teach leadership: Teaching leadership is difficult. The military is most reknown for teaching leadership but that is in a very structured chain of command organization. Chain of command outside of the military would likely mean how most employees want to beat their bosses with chains. MBA programs have demonstrated no success and it's time to stop pretending.

  2. Start teaching Management: It became popular for MBA programs to claim, "We don't teach managers, we teach leaders!" It's worked as well as me claiming that knitting makes me really sexy. However, management skills are precisely what MBA's need to work well in large corporations. Decision-making committees, approval process, and organizational charts are management skills are underdeveloped. Every MBA will be involed in these aspects and there is almost always room for improvement. While not sexy, they can result in a cumbersome decision-making process or decisions that are not fully understood. The failures at financial companies were management organization failures in some way as bad decisions were made. I think that a class on how to change an organizational chart for a start-up as it grows would be remarkably practical and something that Business Schools could teach.
  3. Analytics within a bigger context: Schools are focusing on this with their curriculum reform and it's a great step. In the 70's, an MBA was a general management degree and that is still important. Understanding the data to drive decisions in marketing, finance, operations, etc are useful skills. No matter what department someone ultimately works in, having enough business understand to know what NPV stands for or not snicker when Marketing talks about the 4 P's is valuable. It's not all about financial returns but analytics in a larger context can help an organization.
  4. Certification: Business school is a trade school like law and medicine. Other trade schools have post-graduation certification or training programs or exams like the bar, residency, or fellowships. MBA programs should have the same certification programs. As it is, MBA's will seek out PMP's in Project Management or Belts in Six Sigma to demonstrate mastery. Business schools could set up additional programs to demonstrate mastery in different topics to meet demand for students who are looking to set themselves apart. With regards to the PMP, I keep looking at that certificate program to set me apart even though I know the material is of little value. However, a marketing certification from a business school could be a different story. There is definitely an opportunity.

MBA programs have evolved over time to focus on what's important. Usually, they follow the money (which is not necessarily a bad thing). In times of crisis, those are good opportunities to evaluate what they are really good at and what they are not.

I've also changed. I've stopped knitting at bars and making lewd jokes about the size of my needles.

1 comment:

MaybeMBA said...

Could not agree more.

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