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Dean’s Cornerby Robert S. Sullivan
What a year! The world is experiencing the worst economic crisis since the 1930s. The Dow Jones is hovering around 50 percent of its highs, and the price of oil has dropped 40 percent. We live in uncertain times, where the quality and integrity of leaders and managers of major corporations are called into question. “Wall Street versus Main Street” has become the mantra of the politically correct — a divisive slogan at best during a very disconcerting year.
These troubling economic times provide many lessons for schools of business. They, of course, involve issues of ethics, transparency and social responsibility; and the capacity for innovation and competitiveness. Business schools have an immense opportunity to effectively reverse the economic meltdown. Indeed, they have an important role in redefining a new foundation for economic prosperity. Business schools can seize the moment to aggressively and proactively participate in recovery. More than ever, they can inspire and educate a new breed of leaders and managers.
Politicians and the press are adept at finger pointing and generalizing. A few very bad apples and bad decisions, along with poor implementation of existing federal and state oversight responsibilities, have readily translated into headlines of corporate greed and corruption. For business schools, this should be a particularly sensitive topic. Many of these corporate leaders have received some education at our schools. Yet business schools, unlike most other professional schools, do not require an overt commitment or an oath that defines personal conduct and responsibility. Business leaders and managers do not take the equivalent of the Hippocratic Oath. While issues of integrity and social responsibility are routinely imbedded in MBA curricula, such courses are not necessarily consistent and central. Consequently, our schools and our graduates become easy targets for criticism.
The current economic environment has tossed fuel on the fiery debate about business schools. As noted, many of the leaders of the most significant private sector organizations in the U.S. and abroad have roots back to our schools. Many have business school degrees, while others have participated in executive education courses. Today’s economic crisis again surfaces the question — does business school education appropriately instill and inspire social responsibility and integrity? Or as some have insinuated, do business schools, with their focus on a profitable bottom line, instill a sense of greed? Today, the politicians and pundits have given their (uninformed) answer — profits rule! Where in the public eye or in the press have business schools responded?
Another important question inspired by the economic meltdown involves the role of innovation and the ability of organizations to regain their competitive edge. As has been noted by many, the new industries of the 21st century will be defined by discovery and innovation. Science, technology, engineering and mathematics are fundamental for novel, path-breaking discoveries. The new breed of leaders and managers who can identify, understand, interpret and assess these discoveries will be those who create and grow tomorrow's new industries. They will be entrepreneurial, and they will have the ability to anticipate new markets and opportunities. These new leaders and managers will create and grow the companies that stimulate and sustain economic growth and prosperity. And, these new leaders likely will be educated and inspired at schools of business!
The new leaders and managers will be essential for translating basic research and discovery into market opportunities an engine for economic prosperity. Given the challenges of ethics and social responsibility, and the opportunities associated with innovation and competitiveness, business schools must participate in defining a path for economic recovery. They should be viewed as central to the solution, not part of the problem. They have a role to play, and they must aggressively and visibly pursue this role.
President Obama’s administration has laser focus on the economy. The President’s Council on Innovation and Competitiveness is in direct response to the well-articulated perils of the U.S. lagging in science and technology. Yet, while basic science and engineering are repeatedly highlighted, nowhere is there mention of the essential need for 21st century managers and leaders — those highly talented individuals who can help to translate discovery into market value and impact. This new cadre of leaders and managers more than likely will have received education and inspiration at business schools. They will lead the organizations that define new economic growth and prosperity.
As we reflect on the past year, it is easy to be anxious, if not downright frightened. We have never experienced a global downturn like this. However, there will be a turnaround, and there will be immense opportunities. These lessons of accountability, social responsibility and integrity must now be blazened on every aspect of business education. MBAs must be innovators and entrepreneurs. They must have the ability to understand and translate new scientific discoveries for the benefit of individuals and communities. These new leaders and managers are essential for defining, creating and growing new global competitive economies.
Business schools must assume the responsibility and seize the moment. They must be proactive and visible players in any forthcoming economic recovery. Business schools can help instill hope and confidence in an extraordinary economic future — somewhere on the horizon!