Fixing the MBA identity crisis
Not all MBAs are created equal. That was the topic of discussion over lunch with a classmate of mine, whom I'll call Greg. If the MBA degree is, as many entrants believe, a ticket to a more impressive network of friends, Greg is the archetypal member of the network. His career path reads like an ideal MBA check-list. Management consulting - check. Private equity - check. Harvard Business School - check. After graduation, Greg passed on lucrative job offers to start his own small hedge fund - check.
At our lunch of burritos at a local Qdoba (Greg is more accomplished than glamorous), he was questioning the social stratification we encountered at business school. As he saw it, financiers were at the top, and then there was everyone else. Because of the heavy curricular emphasis on finance and accounting, the students who had managed money and knew financial modeling were often deemed the smartest. Socially, they were the ones you wanted to network with. Students who had "merely" managed people, products, brands, and even non-profits were lumped together in the lower echelons.
This perception seemed to be confirmed during recruiting season. The biggest post-graduation paydays are found in the halls of Wall Street banks or the office parks of Greenwich hedge funds. Indeed, the percentage of MBAs going into financial fields after graduation has never been higher. Greg admitted that he had benefited from this business school caste system.
Is this what the MBA degree was intended to be, a program that values financial acumen above all else? As MBA classes of 2010 graduate this spring and head for jobs in investment banking, private equity and management consulting, the question becomes: What is the meaning of that degree you just received?
The rise in status of the financier at business schools has created an identity crisis for the MBA degree. Looking back a hundred years, the origin of MBA programs was based on the idea that business had both an economic and social purpose. Business schools would teach finance and accounting, but more importantly, they would empower managers to oversee public and private companies in the interest of a broad set of stakeholders: shareholders, customers, suppliers, and society at large. Therefore, MBAs were intended to manage people, products, capital, and societal resources at a professional level, with the idea of long-term value creation in mind. It is a sophisticated mandate and one that requires a broad range of skills.
Today, the need for this type of manager, one who is able to make decisions with a long-term perspective and broad constituency in mind, is more acute than ever. Goldman Sachs, facing increasing scrutiny, must provide customers with financial services and disclosure within a landscape that does not always have regulatory guidelines. Google, as it expands into international markets, must grapple with balancing revenue growth in China in light of the company's stance on censorship. BP, faced with a spill of epic proportions, must balance its search for oil with environmental safety, and must now also wrestle with its responsibility to make restitution for the damage done. These companies are stocked with MBAs who won't find much guidance from the simple, ubiquitous mantra of "maximizing shareholder value."
So where do we go from here? Curriculum change is needed and is coming: We need more emphasis on leadership, decision-making, and cultural awareness. As prominent business thinkers Warren Bennis and James O'Toole write, business is "essentially a human activity in which judgments are made with messy, incomplete and incoherent data, statistical and methodological wizardry can blind rather than illuminate."
But students and graduates also have a role to play. We need to rebuild the principles of business school from the ground up. That is why I and a group of fellow MBA grads created the MBA Oath. Simply put, the MBA Oath is a code of conduct for managers in the same way that the Hippocratic Oath is for doctors.
It starts with two statements about the social role of the business leader:
"My purpose is to lead people and manage resources to create value that no single individual can create alone."
"My decisions affect the well-being of individuals inside and outside my enterprise, today and tomorrow."
Having acknowledged this role, the graduate then makes seven promises: to manage with loyalty and care; to uphold law and contracts; to refrain from harmful business practices; to protect human rights; to consider future generations; to report performance accurately; and to invest in the development of myself and others.
More than 3,000 students have take the oath, and we hope this is just the beginning.
Perhaps financiers will always be on top. Certainly, 20 years from now, we want to see an MBA marketplace that still values Greg's financial abilities. But we need MBA programs that prioritize the creation of responsible managers who strive toward long-term value creation. After all this is where the MBA program was born: in the desire to improve and professionalize the art of management.
June 1, 2010; 5:00 AM ET |
Save & Share:
Previous: Young, disconnected -- and ready for mentoring | Next: Afghanistan's biggest problem is bad leadership
Please email us to report offensive comments.
Posted by: helloisanyoneoutthere | June 1, 2010 6:40 PM
Posted by: therev1 | June 1, 2010 4:44 PM
Posted by: squarf | June 1, 2010 4:26 PM
Posted by: hootie1fan | June 1, 2010 3:30 PM
Posted by: ihatethisstuff | June 1, 2010 2:44 PM
Posted by: jkoch2 | June 1, 2010 12:46 PM
Posted by: diesel_skins_ | June 1, 2010 11:52 AM
Posted by: PanhandleWilly | June 1, 2010 11:38 AM
Posted by: ANTGA | June 1, 2010 11:38 AM
Posted by: bigbrother1 | June 1, 2010 11:20 AM
Posted by: callosumlink | June 1, 2010 11:07 AM
Posted by: CollegeAdminPro | June 1, 2010 11:06 AM
Posted by: mapleleaves1 | June 1, 2010 10:54 AM
Posted by: adrienne_najjar | June 1, 2010 10:53 AM
Posted by: mibrooks27 | June 1, 2010 10:43 AM
Posted by: gccdavid | June 1, 2010 10:17 AM
Posted by: IGiveup1 | June 1, 2010 9:46 AM
Posted by: IGiveup1 | June 1, 2010 9:45 AM
Posted by: AlanBrowne | June 1, 2010 9:45 AM
Posted by: danglingwrangler | June 1, 2010 9:42 AM
Posted by: post_reader_in_wv | June 1, 2010 9:36 AM
Posted by: tinyjab40 | June 1, 2010 9:26 AM
Posted by: recharged95 | June 1, 2010 9:17 AM
Posted by: jfCua | June 1, 2010 9:04 AM
Posted by: Montana1 | June 1, 2010 8:56 AM
Posted by: Montana1 | June 1, 2010 8:54 AM
Posted by: citizen625 | June 1, 2010 8:24 AM
Posted by: postfan1 | June 1, 2010 7:10 AM
Posted by: blasmaic | June 1, 2010 6:30 AM
Posted by: JohnAdams1 | June 1, 2010 6:01 AM
The comments to this entry are closed.