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Real B-School Reform
Jul 8th, 2009 | 9 responses
I worked at Bloomberg Financial News for a number of years. While there I encountered many of Wall Street’s shakers and movers. I found them, by-in-large, to be an extraordinarily arrogant lot.
They really did think they were the best and brightest. They really did think that $5 or $10 million a year in compensation was chump change, and people like themselves were entitled, entitled!, to much more as a best and brightest right. The fact that almost all were indeed getting much more proved in their minds that it was actually deserved.
They certainly did not believe they were predators ripping off the investing public with short term deals that benefited them more than anyone else, and they didn’t believe these deals would cause grievous economic harm to most everyone else down the road. After all, they were making these deals, and they were the best and brightest.
Today on NPR some representatives from leading business schools were discussing possible syllabus changes at their institutions. This new focus, if adopted, would give far greater emphasis to long term policies rather than short term ones, greater emphasis to serving client interests and not just the interests of CEOs and Wall Street heavies. One heard in these ideas echoes of the old Protestant ethic, a traditional talmudic ethic, and a heavy smattering of Pope Benedict’s new Encyclical Letter, “Caritas in Veritate” (Charity in Truth).
So will the proposed syllabus changes in B-schools work wonders in making the next generation of business leaders more socially responsible citizens? Well, they certainly won’t hurt. But by themselves they are unlikely to make that big a difference.
The first and most obvious reason is that the timing here is awful. Such changes should have been made in fat times. These days businesses, their customers, their investors, and their lenders are all focused on survival. Doing good in the marketplace is a hard sell in such an era. And then there’s the matter of ethics teaching generally. Lack of such teaching in B-Schools was not the real reason that business and Wall Street leaders have so often been been so utterly selfish. The real reason was simply that they were just too damn arrogant.
That’s where B-school syllabus reform has to focus if it is to make real changes in graduates. Students there must hear from day one that they are not the best and brightest. The best are cops and firemen. The brightest are teachers. B-schoolers are only people lucky enough to have the opportunity to serve a great many other people and earn a decent living doing so. They are privileged to have this opportunity.
I see truly reformed B-schools as a kind of Marine Corps. Students come in arrogant and it’s driven out of them. Once their exaggerated self-esteem has been excised, they are then reshaped into instruments to create a fairer, just-er economy where rewards are appropriately allocated. Merely adding ethics courses to a B-school’s syllabus is simply well-meant window dressing.
9 Responses to “Real B-School Reform”
Actually, that arrogance seems to be on display among fashionable younger bureaucratic elites as well as those on Wall Street, as we see in Washington currently. Rather than “playing house,” these elitist and arrogant kids want to “play” [with our] “country”! Not just limited to the economy, though that has substantial importance.
Michael,
This idea of promoting mediocrity in our business schools, discouraging arrogance and risk taking and buffering the impulse of the best and brightest to win while leaving the severed heads of their competition on the gates of their estates as trophies is a prescription for disaster.
Just as the U.S. military seeks the best pilots who have the skill and courage to push jets to the point just before the wings break off, the business community needs to push their industries to the same untested limits. That is what makes this country the leader in business.
Crashes are part of the program and a learning experience, but not a reason to stop testing the limits.
Business is not for the faint-at-heart. Let the mild mannered strap themselves into a bus seat for the ride to their cubicles each day but for god’s sake keep them out of the way of the real movers and shakers riding a rocket down the middle of the street.
“reshaped into instruments to create a fairer, juster economy where rewards are appropriately allocated”
That has a sinister tone to it. It goes far beyond converting heads of business into the equivalent of activists and brainwashing them to pursue politically correct, “social responsibility” and other lefty goals.
by AND large.
The comments by jwest and DLS show that the problem is on a societal level. Much of the culture is that you have no responsibility to anyone but yourself and your direct beneficiaries and that business is militaristic by definition…social stability be damned. I'm just criticizing that mindset, not saying government is the solution; the government is proving to be as incompetent, arrogant and short sided as the worst businesses.
It's interesting talking to people from different cultures. I was discussing this very thing with a coworker from India and he said that India is awful when it comes to the boom/bust cycle and corruption, and that very few companies (regardless of size) achieve long lasting success….except for the ones that explicitly are dedicated to “social responsibility” and helping not only its workers but the community at large, especially during hardship. He said that the owners aren't extravagantly wealthy and the executives make in the low million range…and that the reason for their success is that during tough times people remember that and flock to their products and they don't make dumb moves during boom times. He was optimistic (well pretty much all Indians are) about the future of the country in good part because a lot of the companies have started adopting this business model due to its success.
mikkel, so why aren't you running a beneficent company that will provide all those societal benefits? Why isn't Silverstein? Hell, the Tom's Shoe guy is.
Walk the walk, don't just type the talk. There are 50,000,000 liberal voters. I think we ought to see at least 1,000,000 new business model companies out of that group, wouldn't you think?
Why do liberals sit and complain about what conservatives are not doing when liberals ought to be out there showing us the way?
The only thing you need to keep all those young bright executives in line is a Dr Guillotin's invention with a nice sharp blade and a few pikes in the middle of Time Square upon which the heads of few older and not quite as bright executives can be tastefully displayed, right under the New Year's ball.
Any thing else is a waste of time and effort…
Um, because I'm 26. However, I'm in the process of lining up startup money and have a few product ideas that hopefully will turn it into a mid-cap company within 10 years…
So I'm planning on it.
Mikkel,
Unless you are prepared to rip the still-beating heart of your competitor out of his chest and eat it while his children look on in tears, you better go into academia.
Altruism is a reward for success, not a means to it.