Putting the Boot into Business Schools

Some of you may go on to study Business at university after finishing school. If you want to go still further and rise to the top, you may end up at ‘business school’ studying for a qualification called an MBA (Master of Business Administration). This is pretty essential in the top flight of modern business. So why has the Economist recently slammed the top business schools? And they’re not the only ones to do so. Many critics are heaping at least some of the blame for the global recession on the mistakes of business schools.

The schools feel embarrassed. Students at Harvard Business School (HBS) have introduced a voluntary pledge “to serve the greater good” among other worthy goals. It’s not surprising they feel sheepish. Most of the people at the heart of the crisis – the bosses of Lehman Brothers, Merrill Lynch and HBOS all had MBAs after their name. The business schools like to claim they make a difference to the way firms are run. So what’s their excuse when they’re run so badly?

Some people think the problem goes so deep management education needs to start again from scratch. That may be overdoing it. Perhaps they just need to put more emphasis on business ethics and corporate social responsibility (CSR). There is a great deal of talk about embracing “principles of responsible management”, such as “sustainability” and “inclusiveness”. But business schools and businesses have been talking about it for years without turning business people into angels.

Two practical tips are recommended by the article. Firstly, teach history. It seemed to get forgotten that booms inevitably give way to busts, and that the business cycle, having survived many predictions of extinction, continues to prey on the modern economy. The second is to be very, very cautious of ‘fads’ and fashions in management thinking.

The article finishes with, “Business schools need to make more room for people who are willing to bite the hands that feed them: to prick business bubbles, expose management fads and generally rough up the most feted managers.”