That all that we discussed over the last four articles have a big impact in terms of MBA education is obvious. We discussed how technology has changed the basic premises on which Strategy-Structure-Systems were built. Today’s businesses need a breed of managers who would thrive in the VUCA (volatility, uncertainty, complexity and ambiguity) world. They have to operate and succeed in a world where profits and break-even ASAP is not the goal of the strategy or even the investors; organisations are getting flatter and more virtual; systems are aimed at empowerment and built around tasks to be achieved and not around ‘command and control’; customers are more informed with access to information and with serious competitors around, have great choices and hence, are more demanding. These require new skills, orientation and perspectives on the part of managers. Business schools are struggling to cope with these changed expectations and needs.
Formal management education, as we know, is less than a century old. After all, organised business of the scale and size that we see today is only a 20th century phenomena. Even in such a relatively short history, the relevance and appropriateness of MBA education has been challenged and questioned periodically. The first real wave of such soul searching was prompted by the studies commissioned by industry, the Carnegie and Ford groups, in the late ’50s and that led to the current model of MBA education in USA and world wide.
Legitimacy
These studies primarily highlighted the need to create a body of knowledge, and codify and structure management education in some form to create legitimacy and acceptance in the eyes of fellow academicians from humanities and social sciences. This need was felt as management education till then was seen as story-telling and anecdotal. MBA institutions flourished by blindly adopting/adapting to the models developed by humanities and social sciences in terms of academic orientation, educational qualifications, research agenda, methods of teaching and training.
The second wave of criticism evolved over the late ’80s to the first decade of the new millennium. Unlike the industry in the late 50s, the new wave was lead by academicians such as Mintzberg, Pfeffer and Warren Bennis among others. The new millennium saw professors from the temple of management education, Harvard Business School, taking the lead with professors like Rakesh Khurana and Srikant Datar writing well researched books decrying the current model. The irony was that the model under challenge was precisely the medicine prescribed by the earlier wave of Industry-led studies.
Practising managers
The main thrust of the new thinking is that unlike humanities/ social sciences, management education is primarily and should be aimed at producing ‘‘practitioners’, and not necessarily ‘scholars’. Esoteric, ivory tower research should be replaced with applied research looking at providing solutions to real-life problems encountered by ‘practitioners’. So on and so forth. Relevance re-emphasised as much as rigour.
What has been wrong with traditional approach?
Everything, right from selection to education to placements. The global demand for MBA education has been consistently dropping for a while now. Not necessarily for wrong reasons, and it doesn’t look like it is going to be episodical occurrence.
IQ vs EQ
Let’s examine this in some detail. The world over, premier business schools select students using entrance tests (GMAT/CAT equivalents) performance. While this provides a common and consistent view to compare applicants, it doesn’t necessarily indicate ‘managerial or leadership’ potential. These tests, by-and-large, indicate one’s IQ. Now, IQ does not necessarily correlate with high managerial performance. Most managerial jobs involve working with and through people. Most people in organisations are ‘normal’ people. A person with high IQ can ideally succeed in jobs like consulting/investment banking, where individual skills or competencies are relatively more important. But when it comes to contexts that require high interpersonal skills, communication abilities, ability to understand and respond to people at emotional level etc., Emotional Quotient (EQ) becomes more important. Many high IQ people stumble here. Can a high IQ person have good EQ also? Yes, but business schools don’t necessarily check this out. It is more difficult to measure. So an easy way out is taken in the form of using IQ focused tests and hope and pray that the person will figure out the need for EQ by-the-by.
In a world today, where ‘right brain holistic thinking’ is emerging as the most needed premium commodity, ‘left brain’ oriented logical sequential thinking ability is indeed a mere ‘commodity’.
Teaching vs learning
Now, coming to what takes place in between admission and exit (placement). The one or two years a student spends at a school is structured to emphasise ‘teaching’ and not necessarily ‘learning’. One may say that if you are a premier school and have got cream of the student population, the least you can do is to leave them alone in the time they are with you. They are smart enough to learn on their own from peers and others and classes and professors. Most of us academicians don’t think so. The result is disastrous. We teach you in silos because that’s what we are trained to do and are good at. It gives us legitimacy. Our approach to teaching doesn’t highlight the fact that every business problem is interconnected. There is nothing like a marketing problem that doesn’t have implication for say HR or finance or operations. As it is for an operations or HR problem or any other business issue/problem. The emphasis on theory and framework is fine but with significant proportion of applicants, at least in India, continue to be fresh out of college, without any real exposure to how things work in real life, the challenge becomes formidable.
No wonder industry is getting increasingly dis-enchanted with MBAs and are asking uncomfortable questions about ROI for the kind of salaries demanded and expected by MBAs. Srikant Datar of HBS recommends a complete and drastic overhaul of the system and content of MBA programmes after studying the top 100 business schools in the world.
Placements are the other thorn in the flesh for MBA institutions. While rankings and popular perceptions do get significantly influenced by placements statistics, educationists and people who run business schools agonise over this issue. On one hand, no matter how much you may dislike and disagree with placement statistics and popular rankings as a measure of good work done, you, as a head of an MBA institution cannot ignore them. Industry, public and student population consider them to be important.
Job vs career
Are business schools there to provide a great first job or to prepare you for a career? Is their job to educate the students or to just get them good jobs? This issue is unresolved even in premier schools of the world. This impacts what you do in those two years. Right from trying to follow industry fads and fashions by coming up with courses that meet the current flavour to spending enormous resources and time to prepare them for cracking job interviews. This certainly is a great distraction and tells on the quality of learning and education.
While the basic premises have been under intense scrutiny as is described above, evolution of technology with Internet of Things on the horizon, the irrelevance of traditional management education is only getting accelerated.
What is required is a de-novo thought process by going to back to the drawing board.
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