Source: Financial Times
by Helen Barrett
Newly diverse hiring practices represent a challenge to complacent MBA providers
An episode of the animated series Futurama called “Mars University” features a monkey called Gunther who wears a hat that makes him intelligent. Inevitably, he decides the hat is more trouble than it is worth.
“All I want out of life is to be a monkey of moderate intelligence who wears a suit,” he says. “That’s why I have decided to transfer to business school!”
As Professor Martin Parker points out in a funny, provocative new book, Shut Down the Business School: What’s Wrong with Management Education, in Futurama — and in popular culture generally — business education is “shorthand for some combination of greed and stupidity”.
He is right: business schools may be wealthy and their graduates earn a lot of money, but they often have a shoddy reputation among those outside their cool, dynamic, steel-and-glass-plated world. Worse, insiders often seem unaware of it.
Prof Parker’s book is not the only recent blow to business education. Last year, a damning book by Duff McDonald, The Golden Passport: Harvard Business School, the Limits of Capitalism and the Moral Failure of the MBA Elite, attacked the institution that produced Jamie Dimon, Ray Dalio and Meg Whitman. My colleague Andrew Hill wrote that the book: “takes aim at the fat target presented by the school and hits it — repeatedly”.
These and other attacks — which often boil down to suggesting business schools are producers of unthinking, uncritical turbo-capitalists with second-rate minds — may be unfair and the truth more complex. Nevertheless they amount to a low hum of criticism that could turn into bigger problems for business education.
Last month in an interview with the Financial Times, Kevin Sneader, McKinsey’s new global managing partner, said MBA graduates would fall as a proportion of hires at the consultancy from 37 per cent to less than a third. He wants to bring in a wider range of people, with different sorts of skills and experiences — more people who have worked in the creative industries, for example.
For Mr Sneader, a lower proportion of MBAs on the payroll is part of a diversity agenda — and he promised a very different McKinsey in the years ahead. This does not bode well: whenever I ask MBA students where they want to work, they usually say McKinsey.
The consultancy may not be the only favoured MBA employer rethinking how it hires people. Amazon — which has become one of the world’s biggest hirers of MBA graduates in the past two years — recently announced it is to “scale and innovate workplace learning at Amazon”.
It has hired Candace Thille, the influential director of Stanford’s Open Learning Initiative (which provides higher education online courses), and a specialist in non-traditional, data-driven ways of learning and teaching. Could Amazon be building its own university? The secretive company is not telling, but if it is, that could be another blow to elite business schools. In 2016, only consultancies hired more MBAs than Amazon at London Business School and Berkeley’s Haas School of Business.
In the middle market, so-called “alternative providers” of business education offering budget options, such as Europe’s Hyper Island, claim to be doing brisk business.
With hiring for diversity on the rise, employers making other plans and thoughtful books setting out an anti-business school agenda, should business schools and their students be worried?
Yes, though perhaps not yet. Mr Sneader was clear that he still values the MBA. Knowing how to build spreadsheets, calculate and understand net present values are still important to the consultancy. McKinsey later confirmed that only the proportion, not necessarily the number, of MBAs would fall and no timetable was set. Nevertheless, Mr Sneader clearly wants something new.
Prof Parker, meanwhile, told me he does not expect his book to be read as a call to action. It is a polemic, on which he wants people to reflect. He calls for a “school for organising” to replace the conventional business school. But he is a professor of organisational studies at Bristol University, so perhaps it is not surprising he wants to extend his discipline.
For now, many people still aspire to be MBAs. According to GMAC, the body that oversees the most popular entrance exam to business school, 73 per cent of schools saw applications rise last year.
And attacks on business education are nothing new. Henry Mintzberg of McGill and Jeffrey Pfeffer of Stanford have written critically in the past — and from within.
But elite employers are changing how they hire — they want people from outside the coterie. There are signs that business schools and their graduates will have to work harder in future to justify themselves and their place in the world’s most influential organisations. That means less complacency in the face of popular derision.