The Winter of Our Discontent The Business School Case for the Humanities

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The Winter of Our DiscontentThe Business
School Case for the Humanities

• Humanities Social Sciences Research Centre
  Annual Lecture 2008
• Ken Starkey, Nottingham University Business
  School

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The power of ideas

• Practical men, who believe themselves to be quite
  exempt from any intellectual influences, are
  usually the slaves of some defunct economist.
  Madmen in authority, who hear voices in the air,
  are distilling their frenzy from some academic
  scribbler of a few years back. it is ideas, not
  vested interests, which are dangerous for good or
  evil J M Keynes

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Michel Foucault vs. The order of things

• The effort to think ones own history can free
  thought from what it silently thinks, and so
  enable it to think differently.

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Summary of my topic

• What is the business school and what might it be?
• A brief history of 100 years of inexorable
  business school growth!
• The state of the business school, its dominant
  culture, its success, its challenges, its
  discontents
• The history and culture of the business school
  reflects two dominant models. A key question
  running through the history of the business
  school is should it be a professional school or a
  school of social science?
• I will argue there is an opportunity in a new
  design template for the business school, more
  engaged with the arts and humanities and with the
  SOCIAL sciences.
• I conclude with some suggestions for organisation
  redesign.

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The power of narratives

• the ontological narratives the public and
  cultural narratives that inform our lives, and
  the crucial interaction of these narratives with
  the other relevant social forces Somers
• Do we need a new business school narrative?

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Identity Purpose

• Among the faculties, none has a clearer sense of
  purpose than schools of business and medicine -
  Derek Bok, President Harvard University
• Primary purpose of US elite schools is to prepare
  people to become business leaders
• through the MBA and executive education
• Business school education and research develop
  narratives and scripts which impact how managers
  think and act.

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Purpose? Harvard Business School

• If a business school were established at Harvard
  it would soon demonstrate a great capacity for
  public usefulness' (Charles W. Eliot, president
  of Harvard University, 1907). But
• What constitutes graduate work? If the purpose is
  to train hands, or technicians, or merely
  successful money-makers, the course has no place
  in a graduate department of a university. If the
  purpose is to train heads or future leaders in
  business it has no difficulty in justifying its
  existence or place (Dean, 1926)
• Abraham Flexner critical of Harvards creation of
  a business school Modern business does not
  satisfy the criteria of a profession it is
  shrewd, energetic, and clever, rather than
  intellectual in character it aims and under
  our present social organization must aim at its
  own advantage rather than at noble purpose within
  itself

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1960s business school comes of age

• Ford and Carnegie Foundation reports recognise
  the importance of business schools
• Aim to increase their scientific legitimacy to
  overcome criticism that business schools are no
  more than trade schools led to investment in
  economic and behavioural sciences
• with unintended consequences

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From Higher Aims to Hired Hands (Khurana)

• The Social Transformation of American Business
  Schools and the Unfulfilled Promise of Management
  as a Profession
• Failure of higher aim to develop as professional
  schools // failed goal of the professionalization
  project in American management
• The logic of professionalism was replaced first
  by a managerialist logic that emphasized
  professional knowledge rather than professional
  ideals, and ultimately by a market logic that
  subverts the logic of professionalism altogether
• Hired hands - More business, less school

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Core curriculum

• Corporate finance
• Financial accounting
• Managerial economics
• Quantitative analysis
• Marketing
• Operations management
• Corporate Strategy

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University in ruins narrative

• The university is a ruined institution, one that
  has lost its historical raison dêtre
  Henceforth, the question of the University is
  only the question of relative value-for-money,
  the question posed to a student who is situated
  entirely as a consumer, rather than as someone
  who wants to think Readings
• Market vs. pure knowledge, quest for truth,
  culture
• Excessive commercialization in every part of the
  university - Kirp, Bok
• A life of affluence is replacing a philosophy of
  life as the main purpose of HE Kerr
• None of us can relax in this dog-eat-prof world
  - Howard Davies, Director LSE

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Phoenix or pariah?

• Is the business school the phoenix in the ruins?
• Or the quintessential symbol of or even a main
  contributor to ruin?
• Great success by market measures! Global reach
  substantial proportion of students in HE, but
  
• What were formerly, at least in part, places of
  public purpose have become agencies of personal
  advantage and advancement, for example, the MBA
• Cultural disaster - critique of the business
  schools role in the closing of the American
  mind!
• There is nothing else quite like this perfect
  coincidence between science and cupidity
  elsewhere in the university - Bloom

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Business school discontents

• Business schools promise far more than they
  deliver
• Business school curriculum too focused on
  analytics, insufficiently integrative, fails to
  develop wisdom, leadership, interpersonal skills
• MBA distorts those subjected to it into critters
  with lopsided brains, icy hearts and shrunken
  souls
• MBA the Enron effect ethics, CSR issues
• Current business turmoil subprime, CDOs etc.
• Culturally toxic - Greed is good -gt erosion of
  social capital

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Are we a cash cow soon to become a dodo?

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The challenged business school

• Market-led portfolio management - As one market
  dwindles (eg. full-time MBA), you need to create
  another one.
• Rankings dilemmas, Accreditation challenges
• Market saturation - Majority compete in
  increasingly pricedriven, commodity context?
• Dissonance between staff aspirations
  management pressures
• Cynicism Demographics
• Where will this lead? To the end of the yellow
  brick road?
• Elites continue to prosper Shakeout among the
  also-rans
• Innovation new product development - as key to
  success
• Winners will be the elite and the successful
  niche players focused on new knowledge production

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Identity/ PurposeWhat is a business school?

• 2 dominant models - aspirations
• Each with particular purpose and identity
• If the Professional Project has failed what about
  the Social Science Project?

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Current narrative

• More science than social
• Chicago GSB (Graduate School of Business)
• Accomplished peers and a faculty known for its
  Nobel Prizes
• Social science model rooted in economics/finance
  physics envy
• This is the way the world is (and should be)
• Business students spend 95 of their time
  learning how to calculate with a view to
  maximizing wealth - Bennis OToole
• Economic theory (agency theory etc.) ceases being
  a theory and becomes a taken for granted in a
  type of shared cognition - Khurana

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Business Schools core narrative

• In defence of university-based business school,
  the MBA and the role of business in society -
  Hubbard
• Purpose entrepreneurial capitalism, new
  business models to raise productivity
  ideological crusade
• Universities and business schools should offer a
  neutral environment for discussing how to manage
  change in the economy and financial markets
• How? By creating masters and mistresses of the
  universe Who promote venture capital practices
• Private equity firms are the unseen masters of
  business prospects
• Ability to assess valuations key MBA skill

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Social Darwinism rules

• dismal picture of a natural economy defined and
  willed by God as an unequal ratio between
  population and perpetually scarce resources. What
  passed from Malthus into popular ideology was the
  given wisdom that life for most people was fated
  to be a miserable struggle for existence in a
  world where there simply isnt enough to go
  around - Ross

• I can only answer the question What am I to do?
  if I can answer the prior question Of what story
  or stories do I find myself a part? - MacIntyre
• Wall Street as exemplar
• Greed is good - Survival of the fittest, fierce
  competition over limited resources, natural
  selection

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Narrative bias

• Partial readings
• Adam Smith markets depend upon moral sentiment
• Schumpeter the limits of creative destruction
• Markets have strengths limits and follies
  Kay
• Study of Chicago Futures Exchange - paradox the
  very markets in which homo oeconomicus appears to
  thrive cannot be created by homo oeconomicus -
  McKenzie Millo
• Eco-systems teach us more than greed is good -
  Starkey Crane on green narratives

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A question(ing) of narratives

• (American) business model as unrestrained pursuit
  of self-interest, market fundamentalism, minimal
  state John Kay, The Truth about Markets
  Genius, Limits, Follies
• The intellectual foundations of laissez-faire
  economics, the view that markets by themselves
  will lead to efficient, let alone fair, outcomes
  has been stripped away. Today, the challenge is
  to get the balance right between the state and
  the market, between collective action at the
  local, national and global levels, and between
  government and non-governmental action Joseph
  Stiglitz, The Roaring Nineties
• The key question we are now confronting is
  whether the historical symbiosis between
  capitalism and democracy that characterized the
  West can be generalized on a global scale without
  exhausting its physical, cultural and social
  foundations - Ulrich Beck, The Risk Society

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The design challenge - knowledge, narratives,
practices

• Possibility of positioning the b. school as a key
  site for rethinking and reshaping the
  relationship between science, business,
  technology and society
• As focal point of the academy and the university,
  integrating the social sciences, arts/humanities
  
• Creating zones of interconnectivity between the
  opposing domains of science and culture - Delanty
• Challenge to create new narratives that define
  justify the role of management business in
  shaping the economic, social, and cultural bond

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The purpose of the business school revisited?

• To create the performances scripts of
  management education as refining the routines of
  reason into objects and instruments of beauty
  worthy of human aspirations - Jim March

• Today, large parts of the population feel that
  business has become detached from society that
  business interests are no longer aligned with
  societal interests. What has come under attack
  now is the credibility not only of our business
  leaders but of business itself or, in other
  words, of capitalism and our market-driven system
  - Klaus Schwab, Founder of Davos

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Strategy redefining remaking

• Strategy is not only about the survival and
  renewal of the firm itself but also the survival
  and renewal of the greater economic system,
  social system, and ecosystem in which the firm is
  embedded - Stead Stead

• Remaking a profit system into a system conducted
  not just in the interests of consumption,
  important as that is, but also in the interest of
  positive and enduring opportunity for productive
  and creative activity and all that signifies for
  the development of the potentialities of human
  nature John Dewey

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Can the business school in Europe develop a
distinctive identity?

• Establishment of business schools with high-level
  political support in the 1960s as route to
  developing management capability and capacity for
  UK PLC, France
• Inséad was set up because there was a need that
  young Europeans be brought up with a good
  conception of American ideals and the free
  enterprise system - Georges Doriot
• There is an opportunity to create something
  different, something distinctively European.

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The arts turn - need for a design approach

• Our language shapes the problem spaces we deal
  with by naming them. Ways of seeing determine
  and are determined by language.
• In business the language has become increasingly
  fixated on judging decisions according to
  predetermined criteria.
• This assumes that good design work has already
  taken place, even though that is not usually the
  case. It is, therefore, doomed to mediocrity in
  its organizational outcomes.
• Need to shift language towards design and
  imagination.
• Imagination is the chief instrument of the good
  the means of keeping alive the sense of purpose
  that outruns evidence and of meanings that
  transcend indurated habit Art is a mode of
  prediction not found in chart and statistics, and
  it insinuates possibilities of human relations
  not to be found in the rule and precept,
  admonition and administration - John Dewey

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Architecture as reference point

• Frank Gehry - When I make a building, I tell
  clients at the start that we are going to be in a
  liquid state for a lot of the time.
• Lets examine the cultures around here and how
  you deal with communal space where people have to
  work together and live together.
• Functional means achieving a building that does
  all of the things we want as humans from our
  buildings it has something to do with peoples
  pride.
• Managing as designing is a collaborative process,
  not the work of a single, heroic maestro. It
  requires innovative methods of collaborating
  across disciplinary, functional, and
  organizational boundaries, good dialogue and
  persuasive argumentation

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Need for new ways of thinking - Fiction

• For our time the most effective agent of moral
  imagination has been the novel - Lionel Trilling
• Shakespeare as unparalleled resource for
  exploring leadership - Adler
• When asked What the Novel Does, I tend to answer,
  It tells beautiful shapely lies which enclose
  hard, exact truths - Julian Barnes

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Visions, drama, stories

• Visionary leadership creates a drama - Mintzberg
• The deadly director uses old formula, old methods
  A deadly director is a director who brings no
  challenge to the conditioned reflexes - Peter
  Brook
• Scenario planning as dramatic rehearsal,
  improvisation of alternative futures through
  story-telling

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The design approach

• Narrative imagination - Nussbaum
• Dramatic rehearsal - Dewey
• Jazz - Eisenhardt Brown
• Classical music - Drucker

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Another kind of business school?

• Copenhagen Business School innovative blending
  of disciplines
• Using traditional fields within business
  economics and language as a starting point, CBS
  gives very high priority to cross-disciplinary
  and problem-oriented approaches. Therefore,
  sociology, psychology, anthropology, politics,
  law, philosophy and intercultural understanding
  are also important areas in CBS academic
  profile.
• Centre for Art and Leadership
• Imagine a school of business, economics and arts!

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Business School as Focal Point Centre of
Knowledge Network That Transcends Boundaries
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Rethinking organisation
UNIVERSITY
Discipline base
Faculty
School
Research/teaching driven by issues eg.
knowledge economy
Trans -disciplinary teams
Business School
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Finally

• Excavating our own culture can open a free space
  for innovation and creativity - Foucault
• And prepare the way for glorious summer to
  replace wintry discontent!

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THANK YOU