Archive for September, 2009

The Economist discusses this week whether business schools have made any significant changes as a consequence of the financial crisis.  I argue we’re not changing fast enough and are in fact following and not leading.  Others think that is just fine.

The lazy pace of change is proving a frustration for some. Angel Cabrera, president of Thunderbird, worries that schools are missing an opportunity to transform themselves from followers to leaders. “As late as last year, business schools were still debating whether it was irresponsible to use the resources of a corporation to do anything that wasn’t directly related to maximising shareholder value,” he laments. “But the biggest corporations in the world all had social strategies in place—the business world had already resolved this, but we were still debating it.”

However, the speed of transformation is being hampered by a fundamental tension within business schools. They may like the idea of being leaders, but academia, by its nature, takes a long time to implement changes. When professors want to introduce new modules, in response to fast-moving events, they have to go through a lengthy approval process: other faculty have to be won over, academic competency has to be proved, and it has to be demonstrated that the course design meets the quality threshold of the programme, the school and accrediting bodies.

And, in any case, Dr Cabrera’s annoyance is not universally shared. Others argue that it should be seen as a flaw if a school’s curriculum is seen to change too radically—even in such radically changing times. Terry Ilott, course director at City University’s Cass Business School in London, rejects the idea that a school which can’t rush through transformation lacks nimbleness. “It’s not cumbersome, just rigorous,” he explains. “I would be very suspicious of a school that could chop-and-change its curriculum at short notice. In any case, the idea that all business schools have been caught on the hop is a bit of a journalistic myth. A business school that found itself responding to events without anticipating those events would be a pretty poor business school.”

BBC World Service asks what role business schools played in last year’s financial crisis and the ensuing recession, whether sufficient attention is being paid to business ethics, and the consequences of having a sole focus on maximizing shareholder value.  Listen to Max Anderson, the student who led the MBA Oath initiative at Harvard Business School, his professor Rakesh Khurana, who has written extensively and spoken eloquently about the need to professionalize management education, and a few comments by me on the deficiencies of ethics courses.

The Aspen Institute and 28 leaders from business, government and academia, called today “to end the focus on value-destroying short-termism in our financial markets and create public policies that reward long-term value creation for investors and the public good”.

Their proposal advances three mechanisms:

1. Market incentives: encourage more patient capital through tax policy

2. Alignment: better align the interests of financial intermediaries and their ultimate investors

3. Transparency: strengthen investor disclosures

The Internet has revolutionized every industry that deals with information: from journalism to music, television, retail, consulting or even medicine. But higher education continues to resist, hanging on to a model which has basically remained intact for 900 years.  That might be about to change.

Read a great account of this ongoing transformation in this week’s Fast Company (How Web-Savvy Edupunks Are Transforming American Higher Education):

The transformation of education may happen faster than we realize. However futuristic it may seem, what we’re living through is an echo of the university’s earliest history. Universitas doesn’t mean campus, or class, or a particular body of knowledge; it means the guild, the group of people united in scholarship. The university as we know it was born around AD 1100, when communities formed in Bologna, Italy; Oxford, England; and Paris around a scarce, precious information technology: the handwritten book. Illuminated manuscripts of the period show a professor at a podium lecturing from a revered volume while rows of students sit with paper and quill — the same basic format that most classes take 1,000 years later.

Read more »

The United Nations Global Compact,  Transparency International, and the World Economic Forum – Partnering Against Corruption Initiative (chaired by Fluor CEO Alan Boeckmann, who visited Thunderbird this year) are jointly asking CEOs around the world to endorse a  letter to UN Secretary-General Ban Ki-moon in support of the full implementation of the UN Convention Against Corruption.

The letter makes some important claims, including the following:

As business leaders we recognize the risks and damage caused by corruption. Therefore our companies conduct rigorous anti-corruption programs. We have been how widespread corruption in countries discourages investment and makes it difficult for companies to compete on an ethical basis.

“Extended support for the letter by a large group of companies will send a strong signal to both the next Intergovernmental Working Group meeting which is scheduled for 31 August 2009 and the Conference of States Parties in Doha in November 2009″.

This can be a great step in the fight against corruption.  So,

CEOs of the world, unite!