AvantGarde

“This was true before the economic crisis, but is even true in its aftermath. The world has changed, and with that has changed the security that use to come almost by default with a MBA degree. High-paying jobs are no longer guaranteed to graduates, and the opportunity cost of two years of training—especially for those who still hold jobs and are not looking to change fields—loom ever larger. To remain relevant, business schools will have to rethink many of their most cherished assumptions”

This is an excerpt[1] taken from the book “What is the future of MBA education” written by Harvard professors Srikant M Datar and David A Garvin indicating the changed realities before b-school graduates. Today in the aftermath of the global financial crisis and amidst the specter of sovereign debt crisis, there is a definite need for rethinking of business education. This article would focus on what does current business education paradigm entail, how effective it has been and what are some of the key challenges before it.

Current business education paradigm – where we are!

The  current business education seems to focus on taking a student through a grueling two year grind (even more tough 1 year slog at some places) in order to ram basics of wide variety of business subjects. These range from human resources, finance, operations to systems and marketing. At some places, niche topics are taught to students with focus on specific industries such as power, oil & gas, banking etc. There are various case studies, multiple assignments, mid-term and end-term examinations and at the end of the two years the rough stone is assumed to be polished and shaped enough to sparkle as a jewel in the shiny bright world.

The key to a good business school program and campus today is the magnitude of newspaper headline grabbing placements. Therefore the whole system, at least in India, seems to be aiming at producing business graduates who earn eye catching salaries.

A sneak peak at the history of business education – where do we come from!

According to Wikipedia[2], the world’s first institutions specializing the teaching of commerce was established in Lisbon in 1759. It took another 60 years before ESCP Europe (world’s first business school) was established. The Wharton School was established as the world’s first collegiate business school in 1881. Since then a variety of business schools have opened in all parts of the world.

At this stage it is also important to note how exactly management theory evolved. This is important as it has been the key shaper of business education. It all began with the advent of scientific management school[3] heralded by FW Taylor and his espousal of development of a true science of management. Scientific management theory led to a dramatic increase in productivity in a number of instances but also placed undue emphasis on the same. It had the company of classical organizational theory school linked to Fayol’s principles, which were later criticized by others as fables of management. Today along with these schools of management theory we have among us others including behavioral school, management science, the system approach, the contingency approach and the dynamic engagement approach.

Today’s B school curricula primarily epitomize all these approaches in one way or the other supported by pedagogical approaches such as the case study approach.

The science and the art of management – are we focusing too much on the science?

Management is a judicious mix of both science and art. Therefore it cannot be just learnt from books. It has to be actually experienced on the field, in the meeting rooms, in the questioning eyes of office colleagues, each time leading to some modifications in our belief. In the real world, teams may not always deliver the same result; obstacles may not be visible through brainstorming or focused group critiques; the strategies of the meeting room may not be suitable outside of it. We should realize that although we study principles and analyze case studies, in the real world application of theory may falter. This is because the administrative man (as proposed by Herbert Simon) makes satisfying decisions affected by bounded rationality.

But today’s business schools are focusing a little too much on science and less on art. There might be a need for addition of social sciences such as psychology, sociology and business history in the curriculum.

The buck stops here

After the Reagan and Thatcher governments led role reduction of public sector in various spheres in 80’s, today private sector is the key engine of the world economy. Since those days, the role of governments has primarily been consigned to that of regulators. While the government has surely faltered in its regulatory role, in the lead up to global financial crisis 2008, the business world too cannot shy away from its responsibilities. There was a time when there were all powerful governments, today we have all powerful multi-national corporations. As these corporations and many other private enterprises are led by managers, business graduates are sure to face scorn from the general public who are being tormented by the crisis. This is especially true in USA, where we are already seeing “Occupy Wall Street” protests. One thing is for sure, even though we are again looking very solemnly at the government, the buck today stops at the private sector. It is crucial that the paradigm of business education be revisited afresh.

What next?

You might be wondering is this a critique of business education. No, this certainly is not. This is an attempt to start discussion on making us, the budding managers at IIT Kanpur more relevant to the changing society. We at MBA IIT Kanpur should have the courage to challenge the basic paradigms of business school education and strive to achieve change. Again, the aim of this article is not to come up with some suggestions to act as a panacea. The only aim is to start some soul searching, between the faculty, the present students and the alumni, on how to channelize our thoughts to reshape our pedagogy in line with changing requirements.

[1] http://hbswk.hbs.edu/item/6363.html

[2] http://en.wikipedia.org/wiki/Business_school

[3] http://nptel.iitm.ac.in/courses/IIT-MADRAS/Management_Science_I/Pdfs/1_2.pdf

Gaurav Sharma

Ernst & Young

IIT Kanpur MBA Batch of 2007