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Volume 06 | Issue 02 2012

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Giving back. Moving graduate management education forward.

Bharatiya Vidya Bhavan’s S.P. Jain Institute of Management & Research

The Regents of the University of California, San Diego, Rady School of Management

ESADE Business School

Università Cattolica del Sacro Cuore – ALTIS

Net Impact

University of Botswana, Faculty of Business

Pepperdine University, Graziadio School of Business and Management

University of South Florida St. Petersburg

SUNY Empire State College Foundation Syracuse University

Volume 06 | Issue 02 2012

CONGRATULATIONS TO OUR GRANTEES

Global Focus

The Ideas to Innovation [i2i] Challenge

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INSIDE THIS ISSUE China lessons John Quelch on 12 months at CEIBS

No copying Business schools must cherish their diversity

Forward looking Why we need leaders focused on the future

Doctor, doctor An inside look at studying for a PhD

Italy in India SDA Bocconi opens up in Mumbai

Top women How organisations can help women become leaders

PETER DRUCKER SOCIETY EUROPE IN CO-OPERATION WITH THE DRUCKER INSTITUTE PRESENTS

EUROPE

4TH

VIENNA

«Capitalism as a social order and as a creed is the expression of the belief in economic progress as leading toward the freedom and equality of the individual in the free and equal society,…» Peter F. Drucker, The End of Economic Man

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THE ORIGINAL & DEFINITIVE GLOBAL RANKING OF MANAGEMENT THINKERS

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15 – 16 Capitalism 2.0 New horizons for managers speakers include

lynda Gratton

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roger l. Martin

John Quelch

a. Wooldridge

Key topiCs the Capitalist order under siege

ConFerenCe Venue

the role of Management in the renewal of Capitalism

in the heart of Vienna

More with less – unleashing Value Creation and innovation for the post-Crisis world

For deClaration oF interest contact@druckerforum.org registration will open in early May

innovation in Management – new ways of organizing and working learning from alternate models – Cooperatives, partnerships, Hybrid enterprise models etc. tackling the social Challenges of the century

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“The Oscars for ideas.” Costas Markides, London Business School

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1 EFMD Global Focus | Volume 06 | Issue 02 2012

Volume 06 | Issue 02 2012

In focus Are business schools facing a debilitating, almost existential, crisis? Possibly. Are we able to devise ways to avoid it? Probably. These two themes dominate much of this current issue of Global Focus. We kick off (page 16) with a cogent article by Santiago Iñiguez, dean of IE Business School in Madrid, Spain. In it he argues that we need to create a new kind of business scholar, able to compete in the “Triathlon” of research, teaching and involvement in the world of business. “Management education requires a special sort of scholar, professionals who can combine many different facets, from a solid research background to the ability to perform effectively in class and to interface with top managers,” Professor Inigiuez writes. This argument is picked up and developed (page 28) by two British academics, Peter McKiernan and David Wilson, professors at respectively, the universities of Strathclyde and Warwick. They suggest, looking exclusively at the situation in Britain, that external pressures on business schools are forcing them to adopt very similar business and academic models and strategies and that this is squeezing diversity and innovation out of the management education sector. In a report from the “coalface” of doctoral studies in management (page 44), Wolfgang Lassl confirms some of the more depressing elements of the way we teach future business schools academics. According to Lassl, the majority of future professors of management (or one of its functions) may never have been significantly exposed to their object of inquiry. He writes: “A third-year PhD student in organisational studies confided to me that she has never seen an organisation from the inside… how she will teach and understand organisations successfully will remain a mystery”. There are, however, ways out of the morass and the various authors provide them, often recommending very similar solutions, most involving the opening up of the academic theory of management to wider society, particularly practising managers themselves. As Professors McKiernan and Wilson write: “The work has to start here and now”.

We are always pleased to hear your thoughts on Global Focus, and ideas on what you would like to see in future issues. Please address comments and ideas to Matthew Wood at EFMD: matthew.wood@efmd.org

Finally, Global Focus is proud and delighted to list the winners of the 2011 Outstanding Doctoral Research Awards sponsored by EFMD and Emerald Publishing (page 6) and the winners of the 2011 EFMD Case Writing Competition sponsored by a number of academic and other bodies (page 26).

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Volume 06 | Issue 022012

Contents 1 In Focus 4 Obituary A tribute to Jim Herbolich

8 Lessons from China John Quelch discusses his first year as dean of CEIBS with George Bickerstaffe and Matthew Wood

12 New Horizons Global Focus The EFMD Business Magazine Executive Editor Matthew Wood matthew.wood@efmd.org Advisory Board Eric Cornuel, Jim Herbolich Howard Thomas, John Peters Consultant Editor George Bickerstaffe bickerstaffe@btinternet.com Contributing Editors Stefano Caselli, Eric Cornuel, Fiona Dent,Patrick Harris, Viki Holton, Santiago Iñiguez, Wolfgang Lassl, Peter McKiernan, Rebecca Nash, Julie Perrin-Halot, Lindsay Ryan, Richard Straub, David Wilson Design & Art Direction Jebens Design www.jebensdesign.co.uk Photographs & Illustrations © Jebens Design Ltd / EFMD unless otherwise stated Editorial & Advertising Matthew Wood matthew.wood@efmd.org Telephone: +32 2 629 0810 EFMD aisbl Rue Gachard 88 – Box 3 1050 Brussels, Belgium www.efmd.org/globalfocus ©

EFMD

Capitalism 2.0 – new horizons for managers, Richard Straub in defence of a capitalism rejuvenated

20 Needed: academic Triathletes Santiago Iñiguez argues that what business schools need today is multi-faceted and well-rounded faculty

26 EFMD 2011 Case Writing Competition Winners 28 Pressures to conform Peter McKiernan and David Wilson argue that business schools should stop copying each other and start rediscovering their diversity

32 Making managers fit for the future We have always needed leaders able to understand what the future may hold. It’s just that today we need them more than ever. Patrick Harris and Rebecca Nash outline how we might produce them

36 One GIANT step to collaboration and innovation? Business schools are increasingly looking to alliances to increase their strategic reach. Julie Perrin-Halot reports on one French attempt to break down the barriers between management and hard science

40 How women can navigate to become global leaders Fiona Dent and Viki Holton detail how organisations can help more women to become business leaders

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Contents

44 Castles in the sky or more reality?

Wolfgang Lassl offers some thoughts on the relationship between business academia and managers

48 The business of business schools investigated Eric Cornuel assesses the results and implications of the EFMDâ&#x20AC;&#x2122;s first research conference

Wolfgang Lassl considers the relationship between business academia and managers page 44

52 Milan Mumbai Fusion In July SDA Bocconi, the leading Italian business school, will open a new school in Mumbai, India. Stefano Caselli explains how the partnership to create the school came about and how it is likely to develop in the future

56 High Impact: Improving the impact of corporate education programmes Employee training and development is essential. But how can companies ensure it is effective and worthwhile? Lindsay Ryan provides some guidelines

4 www.efmd.org/globalfocus

Jim Herbolich 1949 –2012

Jim Herbolich 1949 – 2012 Many members will now be aware that Jim Herbolich passed away in early April. Jim had been seriously ill for some time and died peacefully in his sleep on 8 April 2012. It is hard to put into words just how much he will be missed both as a colleague and friend. Jim was a pillar of EFMD, kind to everybody, attentive, and wonderful to work with. His contribution to the development of EFMD over the past decade has been immense and the organisation feels a little bit like an orphan now. Jim was involved in the world of education – his life-long passion – for nearly 40 years. He was a scholar of management, both as a teacher and as a researcher and was a faculty member of the Human Resources Management Department of ESADE business school in Barcelona, Spain. He was also a formidable practising manager and administrator himself, with particular skills in man-management and motivation. Jim was American-born though he spent most his life outside that country and was Director of Network Services at EFMD for 11 years where he held overall charge of Membership, Business School Services, Corporate Services, and Research and Surveys. As such, his old-world charm, politeness and universal friendliness pervaded the whole EFMD organisation, laying the foundations for the relaxed professionalism that it exhibits today. To EFMD staff and to the many members who knew him well, Jim meant friendship, kindness, openness, guidance and advice – and great company. For me he was a kindred spirit, a loyal and dear friend who had a profound influence on my life and I will miss him greatly. In fact everyone who had the pleasure of knowing him will miss him greatly but his legacy will live on through the work of EFMD in the future. I also know that Jim would not want us to be sad, rather he would want us to celebrate his wonderful life and many achievements. At the moment this is very hard on all of us but with time I am sure we will be able to look back with a smile on our faces at a truly remarkable man. Goodbye my friend – I will never forget you. Eric Cornuel

Jim Herbolich EFMD Director, Network Services

Jim was a pillar of EFMD, kind to everybody, attentive, and wonderful to work with – his contribution to the development of EFMD over the past decade has been immense

Jim Herbolich 1949 â&#x20AC;&#x201C;2012

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To EFMD staff and to the many members who knew him well, Jim meant friendship, kindness, openness, guidance and advice â&#x20AC;&#x201C; and great company

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Winners of the 2011 Outstanding Doctoral Research Awards >

Congratulations to the winners of the 2011 Outstanding Doctoral Research Awards! We received so many high quality submissions again this year that a number of highly commended awards were bestowed. You can view details of all winners at the link below: http://www.emeraldinsight.com/research/ awards/odra.htm

INTERDISCIPLINARY ACCOUNTING RESEARCH  WINNER Professor Paul Gillis Peking University, China The Big Four in China: Hegemony and Counter-hegemony in the Development of the Accounting Profession in China CATEGORY SPONSORED BY ACCOUNTING, AUDITING & ACCOUNTABILITY JOURNAL

Marketing Research

Operations and Production Management  WINNER Dr Lisa Brodie University of the West of England, England The Nature of Complex Manufacturing System Innovation: The Invention and Adoption of New Forms of Aircraft Wing Manufacture CATEGORY SPONSORED BY International Journal of Operations & Production Management

 WINNER Dr Christian Schlereth Goethe University Frankfurt, Germany Optimal Pricing of Internet based Services CATEGORY SPONSORED BY European Journal of Marketing

Hospitality management  WINNER Dr Richard N.S. Robinson The University of Queensland, Australia “Investigating Creativity as an Alternative Explicator of the Mobility of Chefs” CATEGORY SPONSORED BY International Journal of Contemporary Hospitality Management

Logistics and Supply Chain Management  WINNER Dr Alexander Trautrims University of Hull, United Kingdom Management of In-Store Replenishment Systems: An exploratory study of European retailers CATEGORY SPONSORED BY International Journal of Physical Distribution & Logistics Management

Information Science  WINNER Dr Yuxian Liu Tongji University, China The diffusion of scientific ideas in time and indicators for the description of this process CATEGORY SPONSORED BY Journal of Documentation

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2012 Submissions Education and Leadership Strategy

Human Resource Management

 WINNER

Dr Rachel McNae University of Waikato, Faculty of Education, New Zealand

Dr David Cegarra Leiva, Universidad Politécnica de Cartagena, Spain

Young women and leadership development: Co-constructing leadership learning in a New Zealand secondary school

The Role Of The Founder In SMEs In The Implementation of a Work Life Balance (Wlb) Culture. Effects On Organizational Results and the Use of Practices by the Employees

CATEGORY SPONSORED BY Journal of Educational Administration

CATEGORY SPONSORED BY Personnel Review

The 2012 Outstanding Doctoral Research Awards is now open for submissions. Those who have completed a PhD between 1st October 2009 and 1st October 2012 are eligible to apply. Full details of submission requirements and judging criteria can be viewed online at: http://www.emeraldinsight.com/ research/awards/odra.htm If you have any questions or you would like some posters or leaflets for your institution simply email Emma Stevenson at estevenson@emeraldinsight.com. The 2012 categories are:

Knowledge Management  WINNER Dr Nam Hai Nguyen Griffith University, Australia The Impact of Leadership Behaviours and Organisational Culture on Knowledge Management Practices in Small and Medium Enterprises CATEGORY SPONSORED BY Journal of Knowledge Management

Leadership and organiSation development  JOINT WINNER Dr Dong Liu Georgia Institute of Technology, USA A Follower in Need is a Follower Indeed: Exploring the Joint Effects of TMT Support, Contextual Shocks, and Individual Regulatory Focus on Foreign CEO Self-efficacy and New Venture Performance

Educational leadership and strategy SPONSORED BY JOURNAL OF EDUCATIONAL ADMINISTRATION

Hospitality management Sponsored by International Journal of Contemporary Hospitality Management

Human resource management Sponsored by Personnel Review

Information science sponsored by Journal of Documentation

Interdisciplinary accounting research sponsored by Accounting, Auditing & Accountability Journal

Knowledge management sponsored by Journal of Knowledge Management

 JOINT WINNER

Leadership and organisation development

Management & Governance

Dr Martin Amsteus Linnaeus University, Sweden

sponsored by Leadership & Organization Development Journal

 WINNER

Managerial Foresight and Firm Performance Management

sponsored by International Journal of Physical Distribution & Logistics Management

Dr Claudia Alvarez Autonomous University of Barcelona, Spain Institutions And Entrepreneurial Activity: A Quantitative Analysis CATEGORY SPONSORED BY Management Decision

CATEGORY SPONSORED BY Leadership & Organization Development Journal

Logistics and supply chain management Management and governance sponsored by Management Decision

Marketing research sponsored by European Journal of Marketing

Operations and production management sponsored by International Journal of Operations & Production Management

Healthcare Management sponsored by Journal of Healthcare Organization and Management

8 www.efmd.org/globalfocus

John Quelch discusses his first year as dean of CEIBS with George Bickerstaffe and Matthew Wood

n February 2012 John Quelch completed his first year as Dean of the China Europe International Business School (CEIBS) in Shanghai, China. It was a busy 12 months. Dean Quelch, one of the world’s leading marketing gurus, a long-term senior member of the Harvard Business School faculty and former dean of London Business School, is presiding over a period of aggressive growth at CEIBS. This will include doubling the size of the Shanghai campus, co-developing new facilities in Accra, Ghana, for the CEIBS Africa Programme and increasing capacity use in Beijing, where a new campus opened in 2010 and Shenzhen. Other initiatives to raise the profile of CEIBS internationally have included the launch of a new Finance MBA programme, a co-ordinated PhD with IESE business school in Spain (to begin this year) and the opening of two new research centres – the Centre on China Innovation and the Centre for Entrepreneurship & Investment. As the following interview makes clear, strengthening and deepening the full-time faculty has been a key goal. CEIBS has hired some top names including Professor George Yip, former Dean of Rotterdam School of Management and one-time colleague of Dean Quelch at LBS, and Professor Bruce McKern, former Stanford Sloan Master's Program Director at Stanford Business School. Some of the recruitment tactics have the hallmark touch of Quelch’s approach to marketing.

25 Professor Quelch has authored or co-authored more than 25 books on marketing and related topics His latest book: All Business is Local: Why Place Matters More than Ever in a Global, Virtual World with Katherine Jocz Published by Portfolio Penguin February 2012

They include an advertisement last year in The Economist with the tag line “New dean needs 30 expert faculty now!” In fact, says Quelch, total net recruitment this year will probably be closer to 10. “But we never said 30 in one year,” he says. “And the main aim was to create a buzz. Building awareness is very important – we’re not that well known.” That is one reason why CEIBS, a major sponsor of last year’s Academy of Management meeting, a prestigious bun fight for business school folk, put its slogan, "China Depth, Global Breadth" on every room key card for the 8,000-plus delegates. It also had executive search firm Saxton Bampfylde call 150 European faculty to uncover individuals who might be interested in joining CEIBS. Expect more of the same or similar in the year ahead.

Lessons from China: John Quelch interview by George Bickerstaffe and Matthew Wood

Lessons from China The key is faculty â&#x20AC;&#x201C; you can have terrific physical facilities but ultimately they will be instruments without music â&#x20AC;&#x201C; you have to have the faculty to make the facilities sing

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You have been at CEIBS for just over a year. What has been the biggest challenge? The principal limitation on CEIBS is the size of the full-time faculty. Harvard Business Schoo has 220 faculty and graduates 900 students a year. We graduate 1,000 a year with 65 full-time faculty. So it doesn’t take a rocket scientist to realise that our faculty is seriously stretched. So building to 100 faculty is very important for us. Otherwise we are limited in our ability to serve our customers and take advantage of the many opportunities we have. And we have to be in the ideageneration business and increase our research output. We have to give our current faculty more time and space in which to do research and obviously hiring more full-time faculty is part and parcel of achieving that.

1k Currently CEIBS graduate 1,000 a year with 65 full-time faculty but are looking to increase that to a faculty of 100

That’s part of your being a committed supporter of the concept that good faculty attract good students, who become supportive alumni and so on?

Your first year at CEIBS saw some quite aggressive expansion. Aren’t you concerned about the global downturn’s effect on resources?

Very much so. To my mind, once you get that wheel spinning then everything starts to happen. Everything is selfreinforcing and it really is a virtuous circle.

Resources are always a challenge but they are not a major problem [at CEIBS].

But the key is faculty. You can have terrific physical facilities but ultimately they will be instruments without music – you have to have the faculty to make the facilities sing. There are many beautiful business schools in the world but some of them have no stature whatsoever as sources of intellectual capital. So it’s absolutely essential that, as a dean, you focus your effort on faculty first. Being in China we benefit from a keen interest among many business school faculty to come to China. So we are blessed with a large pool of visiting faculty who come regularly to teach elective courses. However, you cannot build an institution on visiting faculty. It’s like saying to the CEO of a major company that, of his or her top 100 executives, half are only going to show up for a couple of weeks a year and the other half will be there full-time. It’s preposterous. So we have made some very significant moves over this past year to try to boost the full-time faculty.

In China we are talking about a pent-up demand for quality management education that we can’t even scratch the surface of. Demand is very robust and that helps our pricing. Regarding the full-time MBA programme, in which students and faculty are 50% Chinese and 50% non-Chinese, students in the West are looking at the downturn and wanting to ride it out by doing an MBA degree. But they are thinking, “why shouldn’t I do it China, that’s where the future is?" Also, more and more Western companies are moving their Asian headquarters from places like Singapore and Hong Kong to Shanghai, which is increasing the applicant pool of Western students for CEIBS’s Global Executive MBA. Regarding executive education, we were up 25% in revenues in company–specific programmes last year and I expect to match that again this year. We are already the biggest supplier by revenue of executive education of any business school in Asia.

In China we are talking about a pent-up demand for quality management education that we can’t even scratch the surface of

Lessons from China: John Quelch interview by George Bickerstaffe and Matthew Wood

What is your aim – for CEIBS to be a global school in China or just a leading Chinese school? Both. Our motto is “China Depth Global Breadth” – something that we came up with within a few weeks of my arriving at CEIBS to replace the similar but perhaps less pleasing to the ear “China-rooted Global Impact”. Normally, slogan or logo change gets everyone uptight. CEIBS accepted the new slogan because it was close enough to what they already had, was smoother sounding and also works terribly well in Chinese; it has the same kind of resonance and rhythm. What we argue is that no global business schools can match us on China depth and no Chinese business school can match us on global breadth. This positioning also leverages the joint-venture structure of the school, which has a balanced governance, which is 50% Chinese and 50% European; our MBA students are 50% Chinese; our faculty is 50% Chinese; our executive education is probably around 50% Chinese companies and 50% non-Chinese. It reminds me very much of what I learned at WPP [an international marketing services agency]. If you look at international advertising agencies, the best performing subsidiaries are the ones that have 50% local business and 50% global business. Why? International clients value the agency because they know local customers through their local clients. Local clients value the agency because they know best practices worldwide through their work for international clients. That’s the same kind of philosophy we have.

That links back to what you say in your latest book – that the world isn’t flat. The world is flatter than it was but it is definitely not flat. I wanted to reassert the primacy of local versus global – because 90% of all exchanges that take place between buyers and sellers every day are distinctly local, with little or no international aspect. In addition, I find that in discussions about marketing the emphasis is always on brand-building, advertising and new product development with very sparse coverage of place or distribution, which always appears as the fourth P [in the Four Ps marketing mix model: Product, Promotion, Price and Place]. You never see Place any higher. But if you’re working in China or India then Place is of paramount importance. In China, to achieve national coverage, Coca–Cola has to reach two to three million individual points of distribution. How do you do that? Putting a national advertising campaign on CCTV is not the problem. The principal challenge is how do you organise the sales force, the boots on the ground and orderly distribution with no stock-outs across that number of distribution points? All of our economic hopes are now placed on emerging economies. Almost all of these economies have fragmented distribution systems. So how do you achieve increased market share and increased growth? You have to have sales and distribution capabilities; the brand building and the advertising is comparatively easy.

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You talked recently about the way business regards business schools and management education. What is that like in China? Chinese businesses are very positive about management education. They know they need management talent and leadership capacity to handle and sustain the rate of growth. There is admiration for American higher education and there is an assumption that Harvard and Stanford and the other leading American schools have over the past 100 years contributed greatly to American economic performance. China is a very competitive society and credentials and qualifications are important. But is China still a risk-averse country with no great commitment to innovation? There is still a lot of risk aversion in China but it is most evident among people who are over 40 years old – people who as children might have been re-located with their parents, who might have experienced 1989 in a way that taught them not to step out of line. I find younger people are much more open and adventurous – 500 million people on the internet each day who cannot be put back in the bottle. Many Chinese ask “Can China innovate?” I have no doubt that when they are no longer to able to make money by imitating, they will turn to making money by innovating. There is a certain amount of wishful thinking about the supposed inability of China to innovate that, if we are not careful, could come back to haunt us.

Many Chinese ask ‘Can China innovate?’ I have no doubt that when they are no longer to able to make money by imitating, they will turn to making money by innovating

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We are confronted with a fundamental question: are the financial meltdown and the debt crisis direct and necessary consequences of capitalism?

Capitalism 2.0 â&#x20AC;&#x201C; new horizons for managers Richard Straub in defence of a capitalism rejuvenated

Capitalism 2.0 – new horizons for managers by Richard Straub

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he world has been shattered by a series of crises since the collapse of Lehman Brothers in 2008: the near shattering of the world financial system followed by a severe economic downturn across the advanced economies and the surfacing of a sovereign-debt disaster that has been building up during the past 30 years. While the unethical behaviours and self-serving strategies of key players in the financial sector have become quite evident because of the mess, the issue has not stopped there. Many have begun to question the underlying values of the capitalist system as a whole. The idea of “maximising shareholder value” with its obsessive focus on short-term results and pure financial measurements has been called into question in many quarters. Others have focused on what they perceive as a lack of ethical standards and values in business and a disregard for the common good. Given the immense damage that the recent crises have inflicted on the world and its population, a robust discussion about the future of capitalism is appropriate. However, how that discussion is framed is crucial: should capitalism be tossed aside completely in favour of some other economic model or is there a way to improve the system and make capitalism work better in a new global context?

Capitalism under siege Capitalism – and, with it, business leaders and managers – are under siege today. Populist movements on both the left and the right are offering up a slew of reactionary ideas, essentially calling for a return to a closed world. Meanwhile, businesses have lost much of their credibility with the public, as demonstrated by the recent Edelman Trust Barometer. Indeed, only government institutions have suffered a bigger drop in approval than businesses. However, rather than be defensive and turn inward, managers must play a key role perhaps the key role – in the transformation towards a new capitalism. We are now confronted with a fundamental question: are the financial meltdown and the debt crisis direct and necessary consequences of capitalism? Or have these things occurred due to abuses by a small minority of players – and in spite of a hugely efficient economic system that the vast majority of participants have used for positive ends?

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A remarkable performance

Legitimacy lost

The positives are certainly undeniable. Since 1950, according to the Groningen Growth and Development Centre, the world has enjoyed a five-fold increase in GDP per capita, even as world population has soared from 2.5 billion to 7 billion today. Growth and prosperity have not been uniform across the globe during that span but now even the poorest regions are catching up – and fast.

Why then is the image of business and managers so negative? Why are business leaders not seen as the true heroes of the post-war period?

Many believe that Africa is poised for strong development over the next decade. Many economies throughout Latin America are already expanding rapidly. Most of Asia has been on a path of increasing wealth for some time. In short, wherever governments have been able to ensure a degree of stability and security, global corporations and local entrepreneurs have created the conditions for economic development, growth and jobs. All the while, a steady stream of innovations in agriculture, medicine, chemistry, information technology and transportation have emerged from these businesses – not, for the most part, from governments that, at best, have created positive conditions for private enterprise to operate. This, of course, is what capitalism is all about. And there is not the slightest shadow of evidence that any other known or conceived economic system would have achieved this mind-boggling performance in value creation and innovation in such a short timeframe.

The answer is clear: leaders – especially those in large corporations and the financial sector – have squandered the chance to be celebrated because of their arrogance, complacency and isolation from the communities that lie beyond their walls.

x5 The world has seen a five-fold increasein GDP per capita, even as world population has soared from 2.5 billion to 7 billion today, and although not uniformacross the globe even the pootrest regions are starting to catch up

The push to “maximise shareholder value” started with a legitimate idea: the concept of “agency theory” as first articulated in the mid-1970s by Michael Jensen and William Meckling. But since then the pendulum has swung too far, pushing far too many executives to put a premium on short-term results over the long-term health of the enterprise. Mounting pressure to “make the numbers” expected by Wall Street has led many corporations to engage in predatory behaviour, aggressive HR practices with knee-jerk restructurings and massive “downsizings” whenever clouds appear on the horizon and obscene remuneration policies among a self-serving cadre of management elites. Roger L Martin, dean of the University of Toronto’s Rotman School of Management, has demonstrated how this shareholder-is-king mindset has diverted corporations from having a proper customer focus. All of these odious trends were apparent even before the financial crisis struck. CSR programmes have not helped, either. Many of these initiatives were based on a philosophy of business apologising for its success by “giving back” to society. Or worse, to divert attention from socially harmful practices.

PHOTOGRAPH COURTESY OF THINKERS50

There is not the slightest shadow of evidence that any other known or conceived economic system would have achieved the mind-boggling performance in value creation and innovation in such a short timeframe

Capitalism 2.0 – new horizons for managers by Richard Straub

A critical turning point

The big levers for change

The upshot is that despite the undeniable progress that capitalism has brought over the last 70 years, we find ourselves at a crossroads, a painful moment of truth. We need to reform capitalism as it is currently practised lest we see increasing calls to dismantle the system entirely.

There is clear evidence that Management 1.0 with its pedigree in the industrial age will not be adequate to achieve the transformation. Hence the underlying model for Capitalism 2.0 has to be Management 2.0, based on the principles and values outlined below.

The stakes are enormous. In the aftermath of the recent crises, we are confronted with an avalanche of challenges – a world population growing toward 9 billion by 2050; a fragile global financial system; an unresolved sovereign debt crisis, especially in Europe, exacerbated by a system of social protection that has become unsustainable due to the pressures of an aging population; and shortages of energy, food and water supplies in major parts of the world. Yet, the biggest global dream at the moment is a “good” job as Jim Clifton, CEO of Gallup, pointed out at a recent entrepreneurship conference. Given a deficit of 1.5 billion “good jobs” worldwide we can appreciate the magnitude of fulfilling that aspiration…

PHOTOGRAPH COURTESY OF THINKERS50

Clockwise from left: Roger Martin Gary Hamel Peter Drucker Linda Gratton

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Each of these social challenges can be addressed only with an unprecedented stream of innovations at all levels – products and services, business models and the practice of management itself. Hence, the big question: can a better and stronger form of capitalism be realised? Can Capitalism 2.0 provide us with the means to create the economic foundation for a liveable world for all? And what would its underlying management model and management philosophy be?

Which will be the key levers for change as we move toward a new and more effective form of capitalism and management? First, myriad studies show that there is a huge pool of unused or underused human capacity in today’s organisations. Yet most companies do not organise work in a way that can unleash this latent energy. We need new ways of thinking. Lynda Gratton has demonstrated this in her research on “hotspots” and, more recently, in her book The Shift: The Future of Work is Already Here. In the same vein, the late Peter Drucker challenged 21st-century managers to increase knowledgework productivity to the same extent that their forebears increased the productivity of manual labour. Empowerment, autonomy and trust are essential ingredients to make knowledge work more productive – and to accelerate innovation. Second, the entrepreneurial spirit needs to be awakened and fostered on a broad basis, within organisations and in our societies at large. Individuals must take their lives and their destinies into their own hands. And nation states have to create favourable conditions such as early education, tax incentives and the elimination of administrative hurdles. Drucker called for us to create “the entrepreneurial society” some 30 years ago. Are we finally getting there? Sara Horowitz, the executive director of the Freelancers Union, notes that 30% of the American workforce is now employed as independent contractors. She calls this a “third industrial revolution.”

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Entrepreneurialism is not confined to start-ups and new ventures. It is a key capability for all organisations, new or old, big or small. Along with entrepreneurship goes innovation. Open innovation, design thinking and frugal innovation are promising approaches to embed creative power at all levels of an organisation. Next, a shift in values needs to take hold. Specifically, our leaders need to move from taking purely competitive stances to embracing collaboration. While competition is a major driver of efficiency in market-based economies, the potential for collaboration and mutual support in addressing key challenges is a way to increase the pie as opposed to competing for each little part of it. A new sense of responsibility needs to be instilled on a global basis. While the challenges ahead are daunting, they have the potential to create meaning for all those engaging in economic and social activity. Establishing meaning and purpose needs to re-emerge as one of the foremost responsibilities of leadership. Simultaneously creating social and economic value should become the new standard for businesses around the globe. Finally, the state must redefine itself in a fundamental way. In the Western world, government has evolved into a Leviathan suffocating initiative and siphoning too much financial capital from productive use. Even though many politicians are quick to point fingers at the bankers for the financial crisis, they clearly deserve some of the blame themselves for their lax oversight and the way that they have bought off voters with ever-increasing promises from election to election. Translating all of this into action will be a tall order. There is, however, no choice. Achieving “betterness” in capitalism and management, as consultant Umair Haque calls it, is the ultimate test for human ingenuity and creativity.

Learning from alternative models The good thing is that there are already many good alternative models to learn from and build upon. Largely unnoticed, numerous companies from the German Mittelstand (basically the SME sector) have survived and thrived for more than 100 years. And by achieving market leadership, they have created value and generated jobs around the world. When it comes to solidarity and mutual support, co-operatives also boast a unique track record. Today more than 1 billion people are part of co-operatives, and the livelihoods of almost half of the world’s population are supported by such enterprises, according to the International Co-operative Alliance. These organisations – including the Raiffeisen Banks and the BankGenossenschaften in Germany, Austria, Switzerland and the Netherlands – have not only made a mark with their contributions to the community they have also proven an ability to withstand crises in competitive markets better than many of their traditional capitalist counterparts. These largely unnoticed organisations deserve special consideration during 2012, a year that the United Nations has designated as the International Year of Co-operatives. Are there not lessons to be learned from the success of this model for Capitalism 2.0 and Management 2.0? For-profit businesses have developed alternative models, as well. There are, for example, more than 11,000 companies in America that are owned entirely or in significant part by their employees, some 13.6 million of them in total. WL Gore, maker of Gore-Tex fabric and many other products, is a leading example. The company has some 9,000 employee-owners at 45 locations worldwide and generates annual sales of $2.5 billion.

Graybar, a Fortune 500 company, also has a long history of being fully employee-owned. Originally established in 1925 as part of Western Electric, it was purchased by the employees in 1929 for $9 million. Today the $5 billion company is one of North America’s largest employee-owned concerns, with 250 distribution centres throughout America, Canada, Mexico and Puerto Rico. Partnerships also provide interesting clues about how to move forward. Mazars, which grew from a 50-person company after the second world war into a 13,000-employee global organisation, is an example of how value can be created using fundamentally different governance and management models based on democratic and co-operative principles. Even though hierarchy is an inherent element at most companies, selfmanaged organisations offer yet another structure to consider. Gary Hamel, for example, has written about Morning Star, a California-based tomato processing company with revenues of $700 million and more than 400 employees. What makes the company so remarkable is that it has no bosses, titles or promotions. While the Morning Star model may not be universally applicable, it contains seeds that can be widely applied, especially when it comes to building a trust-based organisation with a truly empowered workforce. Citizen Sector Organisations (CSOs), which include nonprofits and nongovernmental organisations, also have much to teach the capitalist world. Drucker had a significant influence on the development of this sector with his book Managing the Nonprofit Organization. Since the 1980s, the Citizen Sector has created jobs about three times as fast as other employers in the OECD. In Brazil, the number of CSOs has risen from about 36,000 to nearly 1 million

17 EFMD Global Focus | Volume 06 | Issue 02 2012

Capitalism 2.0 – new horizons for managers by Richard Straub

1bn Today more than 1 billion people are part of co-operatives, and the livelihoods of almost half of the world’s population are supported by such enterprises, according to the International Co-operative Alliance

over the past 20 years. Today, millions of these groups across the globe attract talented individuals who long for challenging and fulfilling work that is consistent with their personal values and goals. New hybrid value chains between CSOs and for-profit enterprises show that there are unconventional routes to address the immense social issues of today’s world. On a more fundamental level, there is a broader challenge to the Western capitalist model in the form of state capitalism as exercised in countries as different as China and Brazil. As The Economist outlined in its special report on the subject, this new model bears little resemblance to the disastrous spate of nationalisations in Britain and elsewhere half a century ago. China’s infrastructure companies win contracts the world over. The best national champions are outward-looking, acquiring skills by listing on foreign exchanges and taking over foreign companies. And governments are selective in their corporate holdings. Any meaningful discussion of Capitalism 2.0 needs to include an assessment of this phenomenon.

Bringing it all together What we have here is a complex puzzle. Though a number of pieces are already in place, many more will have to be added during the coming years. Creating a new version of capitalism will require a concerted effort between all stakeholders and a great sense of urgency and responsibility. The internet and social media can help. These tools provide all of us with a chance to share experiences, co-create ideas, learn collaboratively and innovate – and all much faster than in the past. But in the end, it will be people, not technology, that make Capitalism 2.0 a reality. A new generation driven by passion, purpose and strong values is poised to engage for the greater good. Yet, managers, in particular must lead the way, moving beyond “business as usual” and “business as bystanders” toward the innovator and activist roles described by Joseph L Bower, Herman B Leonard and Lynn S Pain in their 2011 Harvard Business Review article “Global Capitalism at Risk: What Are You Doing About It?” It is a fitting question on which to end: What, in fact, are you doing about it? And what are you going to do tomorrow?

On a more fundamental level, there is a broader challenge to the Western capitalist model in the form of state capitalism as exercised in countries as different as China and Brazil

MORE INFORMATION

ABOUT THE AUTHOR

Capitalism 2.0 – New Horizons for Managers will be the central theme of the 4th Global Peter Drucker Forum in Vienna on 15-16 November 2012

Dr Richard Straub is Director of Corporate Services and EU Affairs at EFMD and President of the Peter Drucker Society Europe

18 www.efmd.org/globalfocus

Do you want to develop your business in Japan or Korea but lack in-house expertise to do so? Do you need to improve your knowledge of the Japanese or Korean languages and business cultures to succeed in these markets? The Executive Training Programme (ETP) will help you to do this! The ETP is a one year business development and training programme for EU executives from European companies The ETP is funded by the European Union. Participants are supported through: â&#x20AC;˘ Funding of the entire training course in Japan or Korea â&#x20AC;˘ A scholarship provided of 12,200 per month for Japan or 12,000 per month for Korea

Inception module in the EU

Immersion module in Japan or Korea

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A 3-week intensive training course in the UK on the culture, history and civil society of Japan or Korea.

A 30-week business and language training course run by leading universities in Japan or Korea.

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Organisers: Waseda University (Tokyo) Yonsei University (Seoul)

A 12-week internship in a Japanese or Korean company to apply the newly acquired skills and knowledge in practice.

19 EFMD Global Focus | Volume 06 | Issue 02 2012

To date, over 1000 executives and 800 companies have participated in ETP More than 65% of ETP alumni proceed to become top executives within their companies Participant companies’ related turnover in Japan and Korea increases two fold within ten years

‘The skills I learned through the ETP undoubtedly helped me guide my company towards success in Japan. The programme gave me the tools to do it.’ Richard Thornley President Rolls-Royce Japan Co. Ltd., Japan

Interested? Apply online at www.euetp.eu Deadline for applications: 31st May 2012 for the cycle from November 2012 – November 2013 31st May 2013 for the cycle from November 2013 – November 2014 Contact info@euetp.eu for any questions

Funded by the European Union

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Today’s academics might usefully be compared to the classical athletes, insomuch as they must show excellence in a number of fields – research, teaching and involvement in the world of business

Needed: academic Triathletes Santiago Iñiguez argues that what business schools need today is multi-faceted and well-rounded faculty

Needed: academic Triathletes by Santiago Iñiguez

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hen the Olympic Games were founded in Ancient Greece sometime during the eighth century BC, the king of sports was the Pentathlon. As its name suggests, competitors were required to show supreme skill in five areas: the long jump; javelin; discus throwing; the stadion (or 180-meter race); and wrestling. Nobody is sure how the winner of the Pentathlon was established, perhaps by winning three events and doing well in two others. Whatever the method, whenever the Olympics came along, the winners of the Pentathlon were the new heroes. Aristotle, in his Rhetoric, tells us that the participants in this sport were the most complete athletes and were honoured with medals and commemorative urns.

5 When the Olympic Games were founded the king of sports was the Pentathlon. Competitors were required to show supreme skill in five areas: THE LONG JUMP JAVELIN DISCUS THROWING THE STADION WRESTLING

When it was decided to revive the Olympic Games at the end of the 19th century, other combined sports were devised, aimed at measuring the overall athletic ability of participants and favouring in many ways the traditional amateur spirit of the Games. Contestants were not professional athletes nor were they usually specialists in a particular sport. Some of these multi-events have survived to this day, notably the Triathlon, made up of swimming, cycling, and running. Translated to the world of business education, today’s academics might usefully be compared to the classical athletes, insomuch as they must show excellence in a number of fields. The academic race is essentially a Triathlon, made up of three main activities: research, teaching and involvement in the world of business – sometimes through consulting or by holding a management or board post. However, success as an academic has traditionally been tantamount to excellence in research, period. Universities have conventionally selected, promoted, tenured and rewarded scholars who comply with certain requirements related to research activity and output. Other facets of academic life such as teaching, the spreading of knowledge or interacting with the world outside universities have been considered as secondary activities for an academic career, sometimes even as “improper”.

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Nobody could reasonably deny the central value that research should play in scholarly careers. It is probably the core activity of the Academic Triathlon since it tests the capacity of the individual to assimilate existing knowledge and to generate new ideas, concepts and models, and at the same time respecting methodological rigor. However, considering research as an end in itself or the only pure academic activity entails a myopic and incomplete version of the academic vocation. Revealingly, an article in the New York Times described how a Harvard team formed by nine prominent professors of the university and supported by its former President, Derek Bok, was leading an effort to foster the culture of undergraduate teaching and learning. “The group has issued a report calling for sweeping institutional change, including continuing evaluation and assessment of teaching and learning, and a proposal that teaching be weighed equally with contributions to research in annual salary adjustments.” (S Rimer, ‘Harvard Task Force Calls for New Focus on Teaching and Not Just Research’, The New York Times, May 10, 2007. The need to complement research with teaching and practical work is particularly relevant for business school academics. Management education requires a special sort of scholar, professionals who can combine many different facets, from a solid research background to the ability to perform effectively in class and to interface with top managers.

I have often said that business schools need not only “Gurus” – wise sages who originate new thought but also “Kangurus” – academics able to jump from their research tasks to teaching and from there to consultancy or an interview with a journalist. Kangurus of this type are not born but trained and it normally requires a wide career span to exploit the necessary synergies between those different, apparently contradictory but actually intertwined activities. One of the main missions of business schools is to build bridges between academia and companies, between the world of thinking and research and the practical world of business. Academic research makes a vital contribution to our body of knowledge on management. Research methodologies bring the rigor and objectivity required for a clear analysis of reality and allow us to come up with solutions based on comparative studies. In fact, I believe that much of the blame for the recent financial crisis could be attributed to models and ideas from institutions that lacked the rigor that is a feature of academic research. The reputation of a business school is directly related to the research and knowledge that it produces. From my experience with our stakeholders, and particularly with corporate universities, a key criterion in choosing a school to provide customised programmes is its capacity for generating new knowledge.

23 EFMD Global Focus | Volume 06 | Issue 02 2012

Needed: academic Triathletes by Santiago Iñiguez

I believe that much of the blame for the recent financial crisis could be attributed to models and ideas from institutions that lacked the rigor that is a feature of academic research In his book (Thought Leadership Meets Business: How Business Schools Can Become More Succesful (Cambridge: Cambridge University Press, 2008, p. 182), Peter Lorange also highlighted the need for business schools to adopt an “interactive, two-way approach, where propositional knowledge meets prescriptive knowledge”. This mutually beneficial virtuous cycle can be seen in executive education or MBA programmes where participants have considerable experience, giving teachers the opportunity to benefit from feedback by professionals attending their classes. Despite constant criticism to the opposite, business schools are in reality proactive when it comes to developing the mechanisms needed to change the systems that generate and distribute knowledge. The head of a corporate university told me recently that companies are attracted mainly by business schools associated with new ideas and innovation. To make business schools’ research more relevant, I believe that it is necessary to come up with constructive proposals that will strengthen the ties between the academic and business worlds. In line with the arguments of Costas Markides, a professor at London Business School, who calls for “ambidextrous professors”, I think that it is a mistake to underestimate both the value of academic research or of integrative analysis. To do so will lead to the disappearance of a highly valuable and essential approach that has provided rigor to the management knowledge base we currently draw on. I also agree with Professor Markides that it is a mistake to foster the separation between research academics and practitioners. (See his article “In Search of Ambidextrous Professors”, Academy of Management Journal Vol. 50, No. 4 (2007), 762-768.) His proposals to encourage younger scholars to publish not just in academic journals but also in professional publications are the way forward. In this way we will see the transfer of research into teaching as well as encouraging co-operation between businesses and consultancies to identify new ideas and models for research.

This is shown by a concern for strengthening the clinical relevance of research, reflected in the significant number of articles on the subject published in recent years by the Academy of Management, the most influential forum on a global level for academic research into management. To return to the analogy with Ancient Greece, below are some further proposals that might contribute to strengthening the links between Academia and the Agora (the market). Redesign PhD management programmes so that participants, aside from developing the skills of sound researchers, are also given the opportunity to practise the complementary facets that will allow them to teach effectively and also to take advantage of teaching to disseminate the results of their own research. What’s more, doctoral programmes should also facilitate contact between students and business leaders to give them first-hand experience of the real problems of management. This could also be achieved through internships. Adapt tenure systems to take into account not only candidates’ published academic output but also their teaching skills. Furthermore, it would be advisable to introduce procedures to evaluate to what extent teachers maintain links with the world of business, either through membership of boards or consulting work. Obviously, overall

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evaluation will still emphasise research output; the challenge is to find a balance that will allow teachers to incorporate these proposals over time. Once again, the Triathlon analogy comes to mind.

which send consultants into a company for long-term or highly important projects. “Embedded academics” would have one foot in academia and another in the business world.

The proposals mentioned above would probably require evaluation periods of at least one year to provide sufficient perspective on the results and impact in each of the areas.

At IE business school in Madrid, Spain, we have already put this approach into practice: we have a Human Resources Chair sponsored by leading Spanish fashion retailer group Inditex and Accenture’s Competitive Strategy Chair. The professors who hold the chairs spend a significant amount of their time working on specific projects with the companies involved, at the same time pursuing relevant and up-to-the-minute academic research in their respective areas.

Work with business leaders to identify the key issues affecting the business world. A growing number of business schools have already set up interdisciplinary centres aimed at going beyond the remit of traditional academic departments by setting up direct links with companies to develop specific projects. These centres not only encourage interdisciplinary research but also develop training programmes that address specific issues relating to business management.

Develop ways to measure the impact of academic research on the real world. This would mean going beyond the standard bibliometric indicators or article citation rates. We know that in management, as in the social sciences, the impact of ideas cannot just be measured by how often they are turned into patents or registered as inventions, the approach generally used in other scientific disciplines. I would suggest two approaches:

At the same time, it is important that business schools’ boards and advisory councils understand the strengths and weaknesses of their respective institutions. These councils are generally made up of business people or alumni who can provide invaluable feedback on what the real world’s knowledge needs are. Encourage ties between research-oriented teachers and practitioners. So far, this kind of co-operation has usually been restricted to developing teaching material for programmes. But it can be extended to other areas. Responsibility for bringing together the two should be a key objective of department heads, who can advance joint research initiatives. Develop procedures to assimilate knowledge produced outside the academic environment. Business schools should act as knowledge hubs, bringing in new ideas, concepts and models generated outside their immediate sphere, for example in consultancies, corporate universities and other forums. New communication and information technologies offer limitless potential for testing and developing ideas. Appoint “embedded academics” within companies. This would be another step toward setting up chairs financed by companies in business schools. The professors appointed to these chairs would work on specific projects with the sponsoring companies. This approach is already in use among consultancies,

• recognising a piece of academic work on the basis of its inclusion in management programmes taught around the world; for example, models or concepts such as the Balanced Scorecard, Blue Ocean Strategies or Non-market Strategies, which are now part of just about every MBA programme • bringing together academics from business schools, corporate universities, development departments, consultancies and even the publishers of management publications to design systems that would allow for periodic analysis of research produced by schools and their use as management tools in the business world. Ideally, this would come up with a range of measuring systems reflecting diverse cultural and business practices and thus the heterogeneity of the research. Research is one of the most valuable assets of the academic world, and should be encouraged and increased. Sadly, at times of crisis, research, development and innovation (R+D+I) spending tends to be the first to be axed, a policy that in the long term leads only to loss of competitiveness and innovative capacity. It is essential to raise awareness of the value of academic research for the business world, and this is something in which business schools can play a key role. ABOUT THE AUTHOR

Santiago Iñiguez is the Dean of IE Business School, Madrid, Spain This is an adapted and edited extract from Santiago Iñiguez’s book The Learning Curve: How Business Schools Are Reinventing Education (London: Palgrave Macmillan 2011)

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26 www.efmd.org/globalfocus

WINNERS EFMD Case Writing Competition 2011  Best of the Best Joint Winners 

Corporate Social Responsibility

African Business Cases

Craig Smith & Robert J. Crawford

mothers2mothers Written by:

Cynthia Schweer & Roger Strang

Walmart: Love, Earth Written by:

Family Business Waltraud Ziervogel at Konnopke’s Imbiss, Re-Inventing a Berlin Icon

Emerging Chinese Global Competitors A Dispute over a Pay Rise in Company F

Written by:

Urs Mueller & Veit Etzold

Xin Fu & Jian Han

Representing:

INSEAD

ESMT European School of Management and Technology

SPONSORED BY:

China Europe International Business School

SPONSORED BY:

Inclusive Business Models WaterHealth International: Providing Safe Drinking Water to the Bottom of the Pyramid Consumers Written by:

Hadiya Faheem & Debapratim Purkayastha

To review the winning cases and find out more about taking part in the 2012 EFMD Case Writing Competition please visit: www.efmd.org/case

Entrepreneurship

Finance and Banking

SENZ Umbrellas Taking the World by Storm Armand Smits & Wynand Bodewes

The 2008 Anheuser-Busch Inbev Deal: Successful M&A, Divestment and Financing Strategies in Harsh Times

Representing:

Written by:

Maastricht University

Wouter De Maeseneire & Jonas Sandaert

Representing:

SPONSORED BY:

Written by:

SPONSORED BY:

Vlerick Leuven Gent Management School SPONSORED BY:

Supply Chain Management Unilever Tea (A) & (B) Written by:

Ralf Seifert, Aileen Ionescu-Somers & Tania Braga IMD

27 EFMD Global Focus | Volume 06 | Issue 02 2012

Euro-Mediterranean Managerial Practices and Issues

African Business Cases

Inclusive Business Models

mothers2mothers

Becoming a Trusted Advisor

Cynthia Schweer & Roger Strang

WaterHealth International: Providing Safe Drinking Water to the Bottom of the Pyramid Consumers

Written by:

Representing:

Kathryn Bishop

Said Business School, University of Oxford

Representing:

Said Business School, University of Oxford

Written by:

SPONSORED BY:

Written by:

Hadiya Faheem & Debapratim Purkayastha Representing:

IBS Center For Management Research, IBS Hyderabad

SPONSORED BY:

Latin American Business Cases Natura: Expanding Beyond Latin America Written by:

Amitava Chattopadhyay, Betania Tanure & Nina Paavola Representing:

INSEAD Sponsored by:

Sponsored by:

28 www.efmd.org/globalfocus

ver the last 40 years, variety in business schools has diminished considerably. Where once there stood a rich intellectual diversity, there now sits an intellectual conformity as a result of deans being seemingly content to achieve triple-accredited status and to scheme actively in the various rankings games. Like an invisible hand, accreditation, rankings and other “institutional” pressures have squeezed the creative guts from critical aspects of the sector and left a residue of coalescence across many parts of the field. What happened? From the late 1960s to the late 2000s, business schools appeared to be highly successful. Whether measured crudely by cash generation or by scholarliness, through the creation of a specific language, narrative and an eclectic approach to the study of management, their performance from a de novo start through a period of rapid growth seemed remarkable. However, accusations of the complicity of business schools in the recent financial crisis led to intense criticism of them for embracing the “wrong” financial model; for straying away from the internal happenings of business organisations; and for embracing scientific rigour (“physics envy”) at the expense of business relevance. As a result, popular cries of “moral failing” were laid at their expensive doors. Of course, business schools are not passive participants in this decline. There is evidence of recent re-invention as some make their teaching and research more applicable to wider society. Nevertheless, if more schools are to stay focused then an honest appraisal of the underlying pressures that caused this, hopefully temporary, aberration is essential. At the root of the issue is the degree of autonomous choice that business school deans and university executives have over the trajectory of their business school and how much of that trajectory is determined by environmental forces beyond their control.

On the one hand, one can argue that executive management should have control over certain elements of curriculum design or major strategic issues. For example, if a strategy of high growth is chosen then the resultant size will determine the amount of specialisation in terms of numbers of departments, research centres, IT platforms and the expertise of faculty. Alternatively, the choice of a low-growth strategy will lead to a school that is different in capability, structure and focus. On the other hand, business schools and their senior executives face a range of institutional pressures that have worked singly and interactively over recent decades to restrict considerably any autonomous executive choice.

Isomorphism Isomorphic pressures act as a constraining process that forces one unit in a population to resemble other units that face the same set of environmental conditions. Pressures force organisations to adopt rule-like patterns of action and behaviour that become embedded in organisational structures and processes. The result is a set of homogeneous units behaving in more or less the same way. This isomorphism is a central tenet of institutional theory in sociology. In the business school field, these pressures act over time to force schools to conform and, seemingly, look the same. There are three main isomorphic pressures: coercive, normative and mimetic.

Accreditation, rankings and other ‘institutional’ pressures have squeezed the creative guts from critical aspects of the sector and left a residue of coalescence across many parts of the field

Pressures to conform by Peter McKiernan and David Wilson

Pressures Peter McKiernan and David Wilson argue that business schools should stop copying each other and start rediscovering their diversity

29 EFMD Global Focus | Volume 06 | Issue 02 2012

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Coercive and normative pressures Coercive pressures are exerted on dependent organisations by regulatory agencies. This is an influential pressure because of the power differential in a relationship that creates a dependency of one body on another. For example, business school deans talk of the “power” that accrediting bodies have in specifying tight criteria that restrict their ability to make local alterations or adjustments. Whether this power is real or perceived, it exists across the field. As one dean expressed it: “Professional accrediting bodies constrain the curricula most. But in fostering [a culture of] standardisation, we lose judgement, variety, reactivity and innovation”. There can be little doubt that the main accrediting bodies (AACSB, AMBA and EQUIS) provide a rigorous quality-assurance process for the stakeholders of those schools whom they accredit. But they have attracted a fair degree of criticism, not least for the way in which their accreditation badges create and perpetuate an elite of “haves” and the poor relation of “have nots” (the vast majority of business schools) leading one academic to proclaim: “AACSB is like a group of foxes guarding the MBA hen-houses.” Deans pay their foxes for protection under the accreditation badge and, ironically, pay in parallel for the loss of their strategic degrees of freedom. Much of the criticism has been directed at AACSB for its general inflexibility and its lack of interest in anything that does not resemble an elite American business school. But the others share the isomorphic guilt. For example, EQUIS, though more flexible in its approach than AACSB, stresses the need for internationalisation, close corporate connections and the existence of permanent teaching staff (despite network-based organisations being arguably more efficient and effective ways of organising knowledge workers). AMBA’s pressures may be more restrictive still, focusing on student intake, recruitment, curriculum content and relevance and pressing the necessity of the teaching of ethics, creativity and innovation in a post-crisis world. Even if unintended, such pressures weigh heavily upon deans. As well as accrediting bodies, business schools are subject to normative isomorphic pressures by two main types of ranking institutions: the ranking of schools and the ranking of research within them. Both sets of rankings augment the audit society in which we operate with school rankings in Britain

Most rankings produce performance tables, listing schools from top to bottom. We should treat these tables not as mere photographs of positions but as powerful engines

led by media outlets such The Economist and Financial Times; and the research rankings, led usually by government authorities keen to ration limited public research budgets. Inevitably, most rankings produce performance tables, listing schools from top to bottom. We should treat these tables not as mere photographs of positions but as powerful engines. Once the tables exist, they take on a new “life form” by defining the boundaries of a field, the players within it, the relationship between the players and then drive a whole set of competitive dynamics such as “game playing” by deans. To be in the “top ten” (or whatever position is chosen) becomes a systemic part of a school’s mission statement, driving strategy, policy and behaviour. Outcomes are not always positive, as staff morale has been damaged seriously by religious adherence to the game. School rankings force homogeneity in the system through knowledge exchange as followers mimic the strategy, structure and competencies of the leaders. For example, schools in Eastern Europe, India and China mimic top Western schools. Thus the league tables become a reified part of business school politics and strategy. Research rankings also reinforce conformity between schools. Striving to be part of an exclusive elite club (top research rankings), business schools set up similar structures, including differential pay schemes for staff with strong research performance, incentives for top research output, high transfer fees for promising talent, the privileging of research over teaching in the allocation of workloads and promotional systems and, in a world where the book has given way to the peer-reviewed article, the slavish leaning on guides and lists. In Britain, perhaps the most audited of all European academes, deans emphasise the expectation of a set of star articles from active research staff during any audit period. This privileging of the article is embedded both cognitively and contractually, even among probationary staff, causing serious stress and job insecurity. The publishing pressure in the system produces “more of the same” year after year, calling into question whether academics simply publish too much. Moreover, the unintended consequences of audit are often greater than those intended, leading to, for example, risk aversion in research questions, more theory replication, no big projects and the rearing of a generation marked by research conservatism rather than boldness.

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Pressures to conform by Peter McKiernan and David Wilson

Mimetic pressures

What to do?

Copying among schools adds more pressure towards similarity, especially within curriculum design. The ability of business schools to raise revenues has made them a necessity for most university executives, including in such traditional settings as Oxford and Cambridge.

There are several responses to isomorphic pressures; acquiesce, compromise, avoid, manipulate and defy.

As mentioned, late entrants copy models they perceive to be successful and, invariably, add the ubiquitous MBA degree to the mix. This global offering has been heavily standardised over the decades such that good MBA lecturers can travel the world teaching at several institutions without serious alterations to their syllabus content and their power-point slides. Further, explicit and sometimes implicit support for free-market economics in most business schools often permeates the curriculum to negate the teaching of alternative modes of organising. “Although I don’t wholly agree with Henry Mintzberg’s assessment of MBAs as lop-sided critters with icy hearts, I do think the relative neglect of two-thirds of the economy (non-profits and the public sector) is a crushing criticism of many business schools today,” says one dean. In addition, mimetic tendencies can be witnessed in the system of external examiners, moving between schools and striving to hold quality to a predefined standard (usually derived from their own institution) and the tendency to teach, and publish, in English. Generally, such pressures cause the curriculum to be designed and taught in the same manner. This is reinforced by the expectations of accrediting bodies where, after the financial crisis, there were calls to add ethics, CSR and sustainability to all curricula (especially by AACSB). Such conformity means that key social issues (for example, a world where obesity and famine exist in parallel) and alternative organisational forms (communes, Amish, mafia, al Qaeda) go unobserved and not discussed by the wealth of talent within business schools. “If you ask an MBA class of experienced managers what they consider to be important topics to discuss in class, they will often raise topics that are either rarely taught or not taught at all in business schools, [ranging] from ethics to questions of responsibility, accountability, the political economy, war and the role of governments ...so you get this mismatch between what is taught (largely through case studies of successful companies) and what is really wanted by the students,” says a deputy dean.

There is a sense in which the recent co-operative strategic direction of EFMD might yield early results

Many business schools simply acquiesce, accepting their fate is driven by such externalities. Others compromise, by tinkering with the curriculum, by adding CSR, ethics and sustainability. A handful avoid the pressures by making their schools the centre of strong disciplines such as economics, sociology, engineering, politics and medicine. Some will build powerful alliances with practitioners and manipulate the pressures. However, we feel that a domain shift is required to strip schools of these pressures as much as possible and, hence, we argue for outright defiance in order to configure business schools better for the issues that society faces and that schools do not usually engage with. We suggest three ways forward. First, a formidable effort is needed by the institutional agencies that exert the pressures (accreditation and ranking bodies) to work more closely with both schools and academic societies such as BAM, EURAM, EGOS. There is a sense in which the recent co-operative strategic direction of EFMD might yield early results. Second, schools should integrate more with cognate subjects in their own universities. Many mature business school scholars emerged from other disciplinary backgrounds but newer generations have been brought up “within” the field of management. A re-engagement with our roots might bear much fruit in research and teaching and keep curricula alive and pertinent. Finally, narrow and conservative teaching and research foci (for example on how Apple or Hewlett-Packard “got it right”) should give away to an embracement of broader societal problems such as climate change and its effects, pre- and post-conflict societies, implications of a digital society, poverty and inequality, and non-capitalist ways of organising. For sure, this redirection will not happen overnight. But small steps will yield a major survival story for the business schools of the next generation. The work has to start here and now. ABOUT THE AUTHORS

Peter McKiernan is Professor of Management, University of Strathclyde, Glasgow, and Past President of EURAM. David Wilson is Professor and Head of Department, Sociology, University of Warwick, Coventry, and Past Chair of EGOS The authors point out that this article refers to university-based business schools and their view is from a British standpoint.

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Making managers ﬁt for the future Futures activities run into difficulty when there has been no intrinsic effort made to link an exploration of the future to an organisation’s strategic and decision-making processes

We have always needed leaders able to understand what the future may hold. It’s just that today we need them more than ever. Patrick Harris and Dr Rebecca Nash outline how we might produce them

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Making managers fit for the future by Patrick Harris and Dr Rebecca Nash

t is easy to suggest that, given the uncertainty in the world today, having a future-focused leader at the helm is more important than ever. However, while it is tempting to assert this, it is wrong to do so.

The fact is that we have always required leaders who study and try to understand how the future might unfold. Today, the need is simply more apparent when we see significant shifts in areas such as global energy supply and security, climate change, a macro-economic shift in power and a fall in the trust afforded to institutions. But what does it mean to have a future-facing leader? More importantly, how can we equip our emerging leaders with these critical skills before they are exposed to the cut and thrust of leading significant areas of organisations? One sure-fire way to build success in this area is by incorporating Futures, or Strategic Foresight, within leadership development programmes. A working definition of what we mean by the term “Futures” is that it is the means by which an individual or organisation maintains a mindful brief on the medium to long-term future, identifies opportunities within uncertainty, prepares for possible future events, and embeds its future-focused thinking into strategic and decision-making processes.

Why Futures for leadership? “For tomorrow belongs to the people who prepare for it today.” African Proverb The two primary reasons for enabling leaders with Futures skills are the need, as Gaston Berger, the widely respected French Futures pioneer, put it, to “disturb the present” and to lead while dealing appropriately with a context of uncertainty.

Disturbing – and acting in – the present Futures activities can run into difficulty when there has been no intrinsic effort made to link an exploration of the future to an organisation’s strategic and decision-making processes. For solid strategic linkage, leaders must fully embrace a Futures mindset and thereafter promote the ability to act upon the ramifications and opportunities that possessing a longer-term perspective brings. This combination of Futures study and taking action today is a powerful means of making decisions more robust over the long term

Leading in a context of uncertainty Along with the aim to make better, more informed decisions sits an equally straightforward reason for developing future-facing leaders – dealing appropriately with uncertainty. While some events can be planned for, there are others that possess a higher degree of uncertainty and it is in these areas where leaders need to build in not finite plans but agility, preparedness and adaptability.

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Leaders, however certain their agendas may appear today, must deal with uncertainty in the longer-term. How else will an organisation respond appropriately to changing circumstances? Nearer-term responses can usually be developed with planning tools, mediumterm with strategic evaluation. But for incorporating a longer-term perspective, where uncertainty is the norm, the language and tools of Strategic Foresight become indispensable. For clarity, the uncertainty we refer to here is the likelihood of a particular event or outcome occurring within the timeframe under consideration, or the degree with which the event may or may not occur at all.

Enabling leaders with longer time frames and different sources "The future is already here, it is just unevenly distributed." William Gibson The above quote by the gifted science fiction writer William Gibson is an oft-used expression in Futures work. His meaning for our context is that if leaders are to understand tomorrow they should begin by looking closely at weak signals around them today.

Scanning as the first step Gibson’s quote is also helpful for identifying horizon scanning as the initial building block of future-facing leaders. Consider the future-probing examples below. A person driving a car not so many years ago would have perched a map on his or her lap; now they might rely instead on Global Positioning Systems. Was the awkwardly positioned “lap map” a weak signal of drivers needing to see both the road and navigation aids at the same time? Or consider that central locking is standard on cars today but we still tend to use keys to enter our homes. Is central locking of the home a future state that we can expect to see once the appropriate technologies and behaviours fall into place? What triggers might be necessary for this to happen?

The language of Futures A capacity to scan the horizon provides insights into emerging weak signals, as well as a solid understanding of factors that will influence the future. It is these drivers of change that leaders, working with others, can build into key trends that have the greatest relevance for their organisation. Often a future-facing programme of work will develop further by using key trends to construct scenarios – descriptions of future worlds, each as plausible (or implausible) as the other – which leaders can use to paint a picture of the future and which decision makers can use to test future strategies. These Futures components – insights, drivers, trends and scenarios – can show leaders how to steer their organisations into new product areas, invest in R&D or to build adaptable strategies that can respond to the key triggers identified. Leaders can serve a Futures agenda well by accessing multidisciplinary information, by ensuring that the organisation maintains a mindful brief on cues and signals and by being sensitive to alternative points of view. Importantly, by maintaining a set of plausible Futures – each describing a coherent and logically consistent description of a future world – it becomes easier for leaders to select or to create a preferred future for the organisation. Choosing preferred Futures can be defining for leaders – both emerging and established. First, the ability to use strengthened awareness to identify and convincingly articulate a preferred future is not only a hallmark of respected leadership skills but it is also a good way to identify potential emerging leaders. Second, established leaders who are able to align an organisation behind goals to help create a preferred future are demonstrating sound visioning capabilities and are building significant strategic momentum as they progress – an all-important ingredient of achieving strategic aims.

It is identifying drivers of change that leaders, working with others, can build into key trends that have the greatest relevance for their organisation

Making managers fit for the future by Patrick Harris and Dr Rebecca Nash

Constructing a programme for future-facing leaders "Minds are like parachutes, they only function when they are open." Robert Dewar

Futures is not the end product but a key necessary step to improve decisions taken in the organisation

We have discussed the importance of future-facing leadership and the basic recipe required in any Futures activity. But what can we say about the transfer of Futures knowledge in leadership development programmes? What tips are available to ensure that leaders emerge capable of dealing with and responding to uncertainty? Below is a list of principles to bear in mind when incorporating Futures in leadership programmes. Work with individuals – recognise that while the vast majority of Futures studies are conducted with crosssections of an organisation, it is people that bring Futures to life and who will ultimately make decisions afterwards. The need to establish personal attachment to Strategic Foresight should be emphasised when developing existing or emerging leaders. Build a shared language – the Futures space is still a nascent one and can be populated with differing views, methods and applications. Make sure that your leaders have a shared understanding of the language employed. Establish familiarity with methods – knowing and sharing a language is a first step; knowing what approach to apply, when it is best deployed and how to apply it is just as critical. Consider internal skills – developing Futures skills across the organisation is important to help leaders in their capacity to “see more” and to respond better when facing situations of uncertainty.

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Stimulate organisational awareness – a programme that develops leaders in Strategic Foresight – and one that lives afterward in the work of leaders – will transfer organisational awareness, help to identify key events and triggers that indicate future shifts, improve the organisation’s ability to respond and provide greater propensity to adapt to new models and new sources of competitive advantage when identified. Emphasise the importance of inclusivity – leaders need to engage the organisation in order to have the greatest success. Futures as a tool – ensure that leaders know that Futures is just one tool in their tool box. It is an important one but is no magic bullet. Know when to start – leaders should appreciate that Futures is a preparatory activity and is best begun before the organisation is feeling a particular strategic pinch Ensure cultural fit – ensure that future-focused thinking employed in the leaders and organisation has an appropriate cultural fit Futures is about decision making – above all, remember to connect Futures thinking to strategy formation and decision making. Futures is not the end product but a key necessary step to improve decisions taken in the organisation. These principles are a helpful reminder of the characteristics of Futures work that leadership programme designers should bear in mind as they work to construct development platforms. The principles also form a checklist that leaders should firmly grasp if they hope positively to influence the decision-making, preparedness, agility and long-term success of their organisation.

ABOUT THE AUTHORS

Patrick Harris is the founder of the consultancy thoughtengine and was formerly Director of Creaticity for Orange. He is an Associate of The Futures Company. His book, The Truth About Creativity, was published by Pearson Prentice Hall in 2009. http://www.thoughtengine.co.uk/ Dr Rebecca Nash is a senior member of The Futures Company’s Trends and Futures team. She specialises in long-term futures and scenarios methods as well as qualitative customer insight research and consultancy across the public and private sectors. http://www.thefuturescompany.com/

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Business schools are increasingly looking to alliances to increase their strategic reach. Julie Perrin-Halot reports on one French attempt to break down the barriers between management and hard science

Innovation campuses are characterised by their unique mix of science and technology, they are built on a triptych of fundamental and applied research, higher education, and industry and economic value

One Giant step to collaboration & innovation?

One GIANT step to collaboration and innovation? by Julie Perrin-Halot

n a time of shifting dynamics – economic, societal, geopolitical and more – business schools are finding it necessary to think more innovatively about their current and future business and academic models.

As a result, innovations are touching the way we teach, the way we learn, the way we work. They are taking place in our classrooms, our research agendas, our offices, our boardrooms and in our interactions with our communities. They also affect the collaborative networks of alliances and partnerships that schools are developing.

GIANT Grenoble Innovation for Advanced New Technologies

For some schools, new forms of collaboration may be primarily a response to concerns about strategic positioning or brand leveraging. Collaboration may primarily serve the interest of offering new opportunities or, for some, may simply be a question of survival. And yet, while for most schools the economic considerations may remain predominant, behind the choice to move towards new collaborative models is a desire to advance and differentiate the educational experience of their students while responding to the evolving needs of society. The new alliances that schools are entering into are taking different forms. For example, certain schools may decide to initiate mergers with institutions very similar to their own to leverage their strategic positions and build on common denominators to create greater growth and presence. A recent illustration (January 2012) was the announced merger of two triple-accredited French business schools – Bordeaux Ecole de Management and Euromed, based in Marseille. This merger is likely to produce the third-largest school in France in budgetary terms and one that will dominate the southern and Mediterranean areas of the country.

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The Directors of the two schools refer to the critically strategic nature of this choice in the face of globalisation. A global brand must be leveraged and growth must accelerate for they predict that in ten years the French landscape will be dramatically different. While the venture is not without risk, the greater risk would be in not making a move. Another example shows how schools may choose to collaborate through merging with organisations possessing different skill and knowledge sets in the interest of broadening their scope and impact. An example of this is the 2011 merger between Denmark’s Aarhus School of Business and Aarhus University’s Faculty of Social Sciences. Undertaken as a part of a major reorganisation within Aarhus University, this merger has sought to create a structure better capable of responding to some of the greater challenges currently facing society by providing a broader interdisciplinary approach to business and management. Because business leaders today must understand the impact their companies have not only on the economy but also on individuals, on society and on the environment, Aarhus has brought together business, management and the social sciences to provide these leaders with a more holistic awareness and approach. A final example – and the focus of this article – is that of Grenoble Ecole de Management and its unique alliance called GIANT – Grenoble Innovation for Advanced New Technologies. Though similar to Aarhus in its stated aims to find responses to society’s greatest challenges, it differs in that rather than combining management science and the social sciences it is mixing management and hard science. Here is a different kind of alliance, one that reaches beyond the traditional boundaries of business and into a very different and innovative context.

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A handful of “innovation campuses” currently exist, the Massachusetts Institute of Technology and the California Institute of Technology, Caltech, may come to mind. These campuses are characterised by their unique mix of science and technology, serving to imagine responses for tomorrow’s world. They are built on a triptych of fundamental and applied research, higher education, and industry and economic value. However, few innovation campuses include a strong business/management dimension in the higher education component. GIANT is one of the rare cases where a business school is a founding member of a science and technology campus dedicated to working in the fields of information and communication technologies, renewable energy and the environment, healthcare and the biosciences. The GIANT initiative, seeking to emulate an MIT-type structure and reputation, is about both a programme and a campus. The programme is based on a declared intention by the founding members to remove the traditional barriers between disciplines. They are looking to provoke and respond to the scientific and technological disruptions that will drive the economy in the decades to come. To do so, they are combining fundamental research with higher education and integrating a strong economic and industrial dimension through the active participation of a business school with expertise in the area of management of technology. So what does a school specialised in management education have to gain from such an alliance? To begin with, it represents an unique opportunity for a business school, especially one that has already identified itself as an authority in management of technology and innovation (MTI). Grenoble Ecole de Management’s contribution to the higher education area of the triptych is readily self-evident and a multitude of possibilities are opening up in the areas of research and industry.

The effects of the school’s role in the GIANT project are multi-faceted. Many of the concrete manifestations to date primarily concern the school’s programmes, its people and its pedagogy. Grenoble Ecole de Management finds itself in a position to capitalise on its existing expertise in the field of MTI, the niche it has occupied since 1984 when it was created to foster co-operation between scientists, engineers, managers and the corporate world. A series of Advanced Masters programmes have been developed with concentrations such as energy marketing and management, biotechnology management, innovation, and strategy and entrepreneurship. Executive Education programmes linking management and R&D, management and innovation, management and energy, nanotech and biotech management, and design and manufacturing of high-tech services are also being developed. Furthermore, even the more generalist undergraduate and graduate curricula feature additional course offerings related to innovation and technology. Faculty, researchers and students at Grenoble Ecole de Management are being offered many new and diverse opportunities. A host

One GIANT step to collaboration and innovation? by Julie Perrin-Halot

GIANT FOUNDERS INCLUDE: RESEARCH FACILITIES THE ALTERNATIVE ENERGY AND ATOMIC ENERGY COMMISSION (CEA) THE NATIONAL CENTRE FOR SCIENTIFIC RESEARCH (CNRS) LARGE-SCALE RESEARCH INFRASTRUCTURES THE EUROPEAN MOLECULAR BIOLOGY LABORATORY (EBML) THE EUROPEAN SYNCHROTRON RADIATION FACILTY (ERSF) THE LAUE-LANGEVIN INSTITUTE (ILL) SCHOOLS AND UNIVERSITIES GRENOBLE ECOLE DE MANAGEMENT (GEM) GRENOBLE INSTITUTE OF TECHNOLOGY (G-INP) THE JOSEPH FOURIER UNIVERSITY (UJF)

8 The effects of the school’s role in the GIANT project are multi-faceted. Many of the concrete manifestations to date primarily concern the school’s programmes, its people and its pedagogy

A steering committee composed of the eight founding members acts as a central governance body. This is also an innovative approach considering the size and scope of the project as there is no legal structure binding the members. GIANT is an example of collegial project management and its success thus far is due to a clear vision of its objectives and the means required to attain them.

ABOUT THE AUTHOR

Julie Perrin-Halot is Associate Dean/Director of Quality, Centre QUID (Quality and Institutional Development), Grenoble Ecole de Management, Grenoble, France.

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of events and forums linking local industry, researchers, faculty and students are regularly scheduled. Innovation seminars, research seminars and invitations to participate in nationally funded basic and applied research programmes concerning energy and innovation are being made available. In addition, cross-disciplinary projects and networks are being created. Students at the school are offered increased possibilities to carry out innovation-related field missions within their programmes. Courses are being built around innovative projects mixing engineering and management students. Internships and missions for entrepreneurship students are proposed in GIANT start-ups. And new specialisation tracks have been created in marketing and energy, biotech strategy and management, architecture, and business and sustainable development. With its cross-disciplinary approach and focus on new technologies and innovation the GIANT project provides a superb platform for pedagogical innovations, both in content and in methods. New cutting-edge technologies for teaching and learning will be tested with the aim of creating more and different interactive and distance learning opportunities. New blended learning techniques, greater diversification of populations in the classroom, increased experiential learning are all part of an ambitious project to put innovation to work to improve the quality of the teaching and learning experiences. In addition, a new teaching and research oriented learning centre, combining library services with new technologies is under construction. Finally, GIANT will be a campus – but not just any campus. Designed to be carbon-neutral with a co-operative approach to energy management, its buildings will be low-energy with vegetal roofs; a hydroelectric power station and solar panels will produce clean energy. A highly co-ordinated transportation system has been designed (trams, shuttles and electric vehicles) in order to drastically reduce single-occupancy vehicle use and eliminate congestion. This is a unique urban community planning initiative that seeks to create a harmonious interweaving of spaces for work, residence and leisure – a perfect example of how innovations are not only touching the way we teach, the way we learn and the way we work but also the way we work together.

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Fiona Dent and Viki Holton detail how organisations can help more women to become business leaders

How women can navigate to become global leaders We heard many stories of derailment and disenchantment â&#x20AC;&#x201C; highlighting a clash between the competing demands of parenthood and organisational life. It led to frustration and often the curtailment of a womanâ&#x20AC;&#x2122;s career

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How women can navigate to become global leaders by Fiona Dent and Viki Holton

t is clear to us from our own and others’ research that organisations and senior teams within them increasingly recognise the importance of the role of women in business and, indeed, see it as a key business imperative. There is growing media interest and there has never been a better time to grasp the nettle and move to action. The role of the individual in this area is admittedly vitally important. But organisations could and should be doing much more to bring about significant change. This article draws upon the evidence collected from our recent research at Ashridge Business School. We highlight several areas where organisations could contribute to improving the current landscape for women in business, allowing them to be leaders in the field. True, some organisations are forging ahead but these are the exception rather than the rule. There is still much more to be done to ensure true equality. Our focus is on two main areas: • Key career phases • Organisational solutions In our research we heard many stories of derailment and disenchantment. Many of these stories highlighted a clash between the competing demands of parenthood and organisational life. It led to frustration and often the curtailment of a woman’s career. Some of the examples illustrated organisational stereotyping in relation to the working mother, for example: • Once women have children they are no longer ambitious • Working mothers do not want promotion • Working mothers are not interested in taking on operational roles or in stretch or international assignments Providing development opportunities to help women into leadership roles is important at all phases of their career. In the early stages it is about making them aware of their own skill set and abilities and providing them with opportunities to experiment and practise in a supportive environment. As they begin to move into higher levels it involves helping them to gain experience that will prepare them for more senior appointments.

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Should women survive the early and the mid career phase then the next stage – senior and directorlevel appointments – is the most challenging of all. Many commentators have highlighted the lack of women at senior levels in organisations and the recent controversy over the severe lack of women on boards has been a key media issue since the UK based Davies Report in 2011. So, what can organisations do? First, and most importantly, they must recognise that this is an issue and examine the current situation for women in their own organisation. For example, they could develop simple metrics to illustrate the gender pattern in different organisational situations, such as: • Women at different management levels • Women in the talent pipeline who have been identified as high potentials • The number of women applying for promotion to more senior-level appointments • Women attending senior-level executive development programmes • Women leading key strategic projects Gaining chief executive and senior-level commitment to these issues is vital if change is to take place. Rhetoric from the boardroom is not enough. Action is required and, in addition to good diversity policies and practices, senior leaders must model behaviour and show genuine willingness to lead and bring about change for women in their business. At the heart of this is the recognition that for true equality and diversity the topic must be treated in the same way as any other business issue. Senior leaders should ensure that the issue of diversity features in any performance framework, for example by setting key performance indicators.

The lack of women at senior levels in organisations and the recent controversy over the severe lack of women on boards has been a key media issue In our research many people mentioned the importance of role models. Having only one or two women at senior or board level is regarded by many as tokenism and serves to illustrate the lack of commitment from the top. Quotas are one way to deal with this situation and this approach has been used in some countries and organisations. We believe that there are better ways. Getting to the top should always be on merit and it is only by providing women with appropriate experiences at key career phases that this can happen. More opportunities to be involved in senior-level work and on key assignments would help women gain this experience and develop a business reputation among senior colleagues. It is also important that women are involved as decision makers in the talent-management process, identification of high-flyers and succession planning. The three career phases are illustrated in Figure 1 together with examples of who can help and approaches that can be used. There is no doubt that we have come a long way over the past ten years, not least in the numbers of the new generation of women managers who are entering the business world. However, the evidence from our Ashridge research emphasises how much more action needs to take place. We need more organisations that are willing to set the example for others to follow. Earlier campaigns and networks clearly illustrate how important this approach is. Some examples are: • EFMD’s generous sponsorship helped establish and build the European Women’s Management Development network. Martine Plompen ran the secretariat – hosted at EFMD’s headquarters – and many of the early activities and annual conferences were only possible thanks to the help from EFMD and the support of a number of leading employers.

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How women can navigate to become global leaders by Fiona Dent and Viki Holton

Figure 1. Three Phases of Women’s Careers

Who

Early career phase

Mid career phase

Senior career phase

Boss

Role models

Family

More senior colleagues willing to be mentors or sponsors

Job shadowing

Coaching and mentoring

Mentoring

Professional associations and other networks

Reverse mentoring, where younger women act as mentors to more senior directors and/or board members

Colleagues How

Development workshops

Stretch assignments Taking international opportunities

• Opportunity Now in Britain (which was launched as Opportunity 2000) similarly benefitted from company support and the efforts of Business in the Community (the charity trust led by Prince Charles). If more organisations would step forward and lead the way this would help encourage others. It could be within certain sectors or a profession or a country – as shown recently in Denmark with a campaign that includes Danfoss and others. Companies that have developed their own women for senior positions will quickly become employers of choice and will be leaders in the field of diversity. In addition, research suggests that those organisations with greater diversity in their management and senior teams achieve better business results and overall performance. As one woman we interviewed said: “The teams that I’ve worked on that are more balanced, more diverse in terms of gender, culture and experience, have invariably delivered better results and created a great team environment to work in with a good degree of challenge and support and, importantly, become places that others want to come and work in”. About the AuthorS

Fiona Dent is Director of Executive Education and Viki Holton is Research Fellow, both at Ashridge Business School in Britain.

69% Of the 1,400 survey replies received, 69% were from senior managers, directors or chief executives We also interviewed 20 women business leaders to help us appreciate what it means to be a woman manager in the 21st century

Strategic/senior networks Acting as mentor for younger, less experienced colleagues

RESEARCH APPROACH & FURTHER INFORMATION Our research invited women who had attended programmes at Ashridge Business School to complete an on-line survey and asked them to contact others who might also take part in the research study. Over 1,400 replies were received, including 69% from senior managers, directors or chief executives. We also interviewed 20 women leaders to help us appreciate what it means to be a woman manager in the 21st century.

A book, Women in Business: Navigating Career Success by Viki Holton and Fiona Elsa Dent, detailing the research findings, was published in April. There is also an executive summary report; for a copy of this please contact either: Viki Holton viki.holton@ashridge.org.uk Fiona Dent fiona.dent@ashridge.org.uk

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It remains a mystery to me how answering a question for the unit digits of n in the expression n=5 x +7 y+3 in less than 100 seconds relates to a doctorate in management

he 16th century marked the end of medieval castles. The power of gunpowder turned their walls into paperboard and the rise of cities as the vibrant centres of society made rural castles irrelevant. So, are we now seeing similar changes with regard to one of the last remaining medieval institutions: the universities? The internet has fundamentally changed the ways we create and spread knowledge and has brought down former icons of academia such as the Encyclopaedia Britannica. Society as well as business needs constant innovation and learning, but will universities and academic research be the places to provide them? Or will people, and in particular managers, look for different ways to acquire knowledge and create new ideas â&#x20AC;&#x201C; perhaps via the web â&#x20AC;&#x201C; thereby bypassing universities? After 12 years in management consulting and with many open and unsolved questions that I wanted to explore more deeply, I decided to return to academia for a PhD in management at a North American university. My experiences so far have confirmed my decision. However, the deeper insights I have gained into how future professors are shaped have only posed another question: does this training add to additional knowledge needed in a modern society and business world or is it rather intended for medieval castles? I began to realise that the divide between the world of research and the world of practitioners is greater than I thought â&#x20AC;&#x201C; and the reasons why can be found on both sides. First, let us take a look at the selection of PhD candidates. One of the best-known entry hurdles is the GMAT, an academic aptitude test. The internet is full of advice and training materials on how to achieve high scores.

Wolfgang Lassl offers some thoughts on the relationship between business academia and managers

Castles in the sky or more reality? by Wolfgang Lassl

Yet, it still remains a mystery to me how answering a question for the unit digits of n in the expression n=5 x +7 y+3 in less than 100 seconds relates to a doctorate in management. Will someone who solves this question have a good understanding of management issues and the governance of organisations? Perhaps; perhaps not. Although business programmes choose candidates not exclusively on the basis of this test, they yet place great emphasis on it. Most PhD candidates are young, in their late 20s or early 30s. Candidates with a few years professional experience seem to be a minority; candidates with more than ten years work experience are the exception. PhD programme administrators tend to be cautious vis-à-vis professionals because they fear that professionals, after having tasted the sweetness of “real life”, may find it hard to stand the rigor and academic solitude of a PhD. Worse, they may be unsuccessful dropouts who, in the absence of other choices, want to try the quieter academic life. As a result, the majority of future professors of management (or one of its functions) may rarely have been significantly exposed to their object of inquiry. A third-year PhD student in organisational studies confided to me that she has never seen an organisation from the inside. A lack of sense in his research was simply a logical consequence. And how he will teach and understand organisations successfully will remain difficult to understand. This is not intended to question the capabilities of young PhD students – on the contrary. The issue here is rather the right balance: do we not need more people in research that have acquired

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Practitioners should be more willing to let researchers into their own organisations and engage and involve them more with their real ‘burning issues’

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We are creating intellectual monocultures where we should have a vibrant academic discussion between different and conflicting perspectives that specific knowledge that can only be acquired through time and experience, in particular for a practical science such as management? Are we not foregoing valuable resources for inspirations and new perspectives? Furthermore: interdisciplinary research, the source of many innovations, seems to be more often a myth than reality. Instead, we see fragmentation and ever-increasing specialisation in research – contrary to the reality of practitioners' experiences, which are commonly interdisciplinary and multifaceted. This is further intensified by the fact that professors are assessed by the frequency with which they publish in top journals. Since it is impossible for an individual to acquire knowledge in several different academic areas, remain updated and publish a significant amount of papers at the same time, the current system of rewarding academics necessarily leads to research silos. For a PhD applicant this also implies that, apart from formal hurdles, in order to be successful it is highly critical to target very precisely the specific interests of the faculty overseeing the PhD programme. Candidates who have a topic in mind that is different from the current faculty’s research interests are “not the norm” and face an “uphill battle” as one admissions officer phrased it. We are creating intellectual monocultures where we should have a vibrant academic discussion between different and conflicting perspectives. Only this way can there be a stimulating environment for new ideas and innovation.

But, as indicated, the divide is also due to practitioners’ attitudes. Researchers often run into resistance from organisations when they ask to carry out research within them. This is less due to business secrets than practitioners’ unwillingness to undergo what many regard as an “inspection”. Many fear being told uncomfortable truths by someone who does not depend on them and cannot therefore be controlled (this distinguishes an academic from a consultant who has to secure his or her next project). Yet, truly scientific advice might be very helpful; many organisations are still governed more by wishful thinking than by evidence. Research on what makes organisations function effectively is greatly needed. We instead see managers turning to unsafe sources of advice. These include: • consultants selling their subjective experiences of a very limited number of similar projects (mostly with competitors) as “expertise” and who have seldom tried out their advice on themselves • the huge mass of management literature published every year of the type “the 100 most important factors for success” (but can anyone really control the “100 important factors for success”?) • anecdotal advice from retired managers (but do they really understand why they have been successful?) or from fellow top managers of other organisations (but who knows whether their advice really suits one’s own organisation)

47 EFMD Global Focus | Volume 06 | Issue 02 2012

Castles in the sky or more reality? by Wolfgang Lassl

Summing up, the sources of independent, well-founded advice are limited and we still tend to manage organisations on the basis of (personal) faith and beliefs instead of knowledge and facts. Research has tremendous value for practice. Our behaviour and decisions are governed by our views of the world or, in academic language, by our theories. To have a sound and tested theory on the management of organisations is therefore vital and decisive for success and failure. “Nothing is more practical than a good theory”. Good management theory provides guidance and spells out the otherwise hidden assumptions and interdependencies in daily management life. Furthermore, it helps to reflect on oneself, to adopt different perspectives and to see the blind spots. It makes sure that we have captured the essential questions in our decisions; it provides us with the map necessary for orientation. We have to accept that both worlds have their own purposes and consequently their own way of functioning. Academia is embedded within the context of universities and as such has the obligation to address more fundamental questions and issues reaching beyond daily operational life. It must think about the “bigger picture”. Business research is also competing with other sciences in terms of methodology. It therefore needs the ability and freedom to address problems in a more formal, less accessible language.

However, we also have to incorporate the demand by practitioners to have their questions addressed and solved in reality (and not just in sometimes reductionist and abstract models). Research would gain a lot in credibility and acceptance if it provided more of this kind of solution. What needs to be done to close the gap between academia and real life? We have to bear in mind that changes will only happen if the system behind the individuals is changed.

On the other hand, practitioners should be more willing to let researchers into their own organisations and engage and involve them more with their real “burning issues”. The boundaries between academia and practitioners have to become more transparent. Finally, we should devote more funds explicitly to interdisciplinary research. A multifaceted world requires interdisciplinary solutions as we see in the current financial crisis. This way, we could ensure that we will live in modern villas instead of old castles.

So, on the side of the researchers we have to rethink how research agendas are defined. It seems that these are mostly set by researchers themselves. It would be worthwhile to involve practitioners more. Practitioners should also be able to determine, together with academics, what topics are relevant for research from their perspective and they should also be integrated in the review of articles for publication. This may also require a “cleansing” of academic language. Sometimes one is tempted to think that academic language is used as a tool to increase rather than to reduce the complexity (or simplicity?) of issues. Another systemic factor that should be reviewed is the performance indicator of academics such as the number of publications. Do these indicators not lead to too much incremental research rather than ground-breaking new insights?

What needs to be done to close the gap between academia and real life?

About the Author

Wolfgang Lassl has worked for 12 years as a management consultant, university lecturer and top executive coach in the fields of strategy, organisation and leadership. He has worked for organisations in the private, public and non-profit sector. He has earned two master degrees from his studies in theology and philosophy in Vienna and Paris, and in international relations at the Fletcher School of Law and Diplomacy, USA, as a Fulbright scholar. He is currently preparing for his PhD in management on the design of organisations.

48 www.efmd.org/globalfocus

The business school of the future must be characterised by speed, agility and rapid adaptability rather than by bureaucracy, silos and axiomatic force

The business of business schools investigated Eric Cornuel assesses the results and implications of the EFMDâ&#x20AC;&#x2122;s first research conference

The business of business schools investigated by Eric Cornuel

n increasing understanding of our institutions and our industry confirms how vital leadership, change and innovation are for the business school and management education community.

The early days of the EFMD R&D initiative identified core research themes for management education as a research field. Now the first EFMD Higher Education Research conference, held in midFebruary 2012 at The Lorange Institute of Business in Zurich, Switzerland, has successfully concluded. The changing context of business and management education was highlighted throughout the conference. A wealth of papers focused on leadership and change in business schools, internationalisation, and on branding and reputation. Much of the content of the conference reflects thinking that has been circulating within EFMD for some time, though further and more in-depth research work is required. Nevertheless, we have already reached an important milestone. Business schools have traditionally followed a path of conformity and collective rationality, to some extent driven by external pressures from quarters such as media rankings and government agencies. But despite these (sometimes heavy) pressures to conform, business schools need to find and develop a stronger voice, to start extending their boundaries and to escape the tempting dangers of homogeneity. We also need to acknowledge how different dimensions of excellence may be defined by different stakeholder groups. [Some of these issues are addressed by Peter McKiernan and David Wilson in their article “Pressures to conform” on page 28 of this issue of Global Focus. Professors McKiernan and Wilson presented their ideas at the EFMD research conference.]

49 EFMD Global Focus | Volume 06 | Issue 02 2012

Peter Lorange, who hosted the EFMD research conference, was of course the long-standing head of IMD in Switzerland and now runs his own business school, The Lorange Institute of Business, in Zurich. There he is trying to establish “the business schools of the future” as he foresees it – a networked, high-tech system with few if any full-time faculty. EFMD is closely observing this experiment, with a generally friendly eye. Certainly many of Professor Lorange’s ideas and concepts chime with our own. He says, for example, that the business school of the future must be characterised by speed, agility and rapid adaptability rather than by bureaucracy, silos and axiomatic force. This is a true and very important message for business of schools of today to take on board. Instilling the competencies, capacities and attitudes required for the next generation of global business leaders requires more than relying solely on the simple acquisition of knowledge. Experiential, presentational, propositional and practical ways of learning must be integrated into the curriculum. The top business schools of the future must train their students to meet the demands of an increasingly complex world and in doing so they will have to use challenging and innovative approaches to management education. They will need to implement substantial changes in the ways they prepare the next generation of leaders. While some schools are already employing multidisciplinary approaches to learning, the topic of corporate global responsibility presents a further opportunity for integrated learning and for co-operation between traditional business school subject areas. Corporate global responsibility requires both the knowledge and application of learning to a diverse set of business topics.

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Studies in this area provide an avenue whereby business schools can move beyond functional boundaries to holistic practice.

While this may have some validity, I personally prefer to look at which elements of ranking tables are of most relevance for students.

It is vitally important for business schools (and the EFMD, which through its EQUIS and EPAS accreditation systems is charged with enhancing the quality of management education) to have pedagogical methods that guide and train students to think critically and enable them to exercise their judgement in resolving new situations and problems as they appear.

Business school deans have many strategic choices and there are many opportunities to follow novel strategic directions. However, research suggests that future growth and competitive advantage might be better achieved through the reassertion of national, regional and local cultural characteristics.

It is vital that business school faculty accept the importance of this. We know that in today’s “image economy”, branding is emerging as a key competitive weapon. Yet research presented in Zurich confirmed what many already believed – that it is hard to predict how faculty members in an institution will react to efforts to manage its reputation or brand in a strategic way. It was no surprise that the issue of media-based rankings of business schools also featured prominently at the Zurich conference. It is now widely acknowledged in discussions of business school rankings that they co-produce what they purport to measure. It is also clear that attempting to convert qualitative issues into quantitative metrics in order to produce a “league table” involves severe simplification while at the same time conferring an aura of authority and public accountability. One of the consequences is a trend towards excessive conservatism towards such key issues as curriculum design as ranking methodologies become internalised within schools. Researchers argue that rankings retain their popularity and wide diffusion because, despite possible faculty objections, they in some way “discipline” individuals within business schools.

A multi-polar world influences the variety of models for management and management education. This echoes the wider debate on contextualising management education. It also raises the question, as some researchers did in Zurich, as to whether business schools are ignoring the changes in the production and codification of knowledge. Especially regarding research, it can be argued that more global platforms are needed as well as more partnerships between interdisciplinary research teams. New types of “hybrid” knowledge may prove to be a major enabler for innovation if the walls hindering interdepartmental research collaboration can be lowered. We also need to continue to think deeply about the ethical side of business and management, and especially the role here of management education. Despite the common view that schools have introduced courses on ethics and values only recently, in response to corporate scandals, they have in fact been part of MBA programmes and other areas of management education for many years. But business schools can do only so much. Ethical standards must be taught earlier. Standards and respect have to be taught from the kindergarten. If a four-year-old does not respect principles, there is not much a business school can do later. It is hard to change the embedded values of someone who is 25 or 35.

The business of business schools investigated by Eric Cornuel

51 EFMD Global Focus | Volume 06 | Issue 02 2012

Business schools should ask themselves about their methods of preparing their participants to become innovators, leaders, creators and so on Nevertheless, business schools should ask themselves about their methods of preparing their participants to become innovators, leaders, creators and so on. In the context of a free economy, business schools have a crucial role to play in optimising the way institutions, private as well as public, are managed, with the objective of ensuring the best possible level of growth and thereby, we all hope, a dramatic improvement in peoples’ lives. In looking to the future EFMD wholeheartedly endorses the conclusions put forward at the Zurich conference by Howard Thomas, Dean of Lee Kong Chian School of Business at Singapore Management University.: •F irst, more research is needed into the theory of managing; is there a body of management knowledge and what does it contain? • Second, management education and business schools must embrace theoretical pluralism: liberal education traditions will become more common • Third, the search for dynamic managerial capabilities will continue and will influence developments in business schools. Finally, we know that technology will become a more dominant influence on management education. The conventional case study format may die and it is to be expected that the influence of traditional media will decline relative to digital and social media. The quest for future scenarios was ongoing during the two days of the research conference in Zurich. Yet many issues are left to be addressed: innovation, mutual learning, the development of the next generation of teachers and management education leaders, the contribution of business and society, and internal hurdles to change. It is a full agenda that EFMD will relish meeting.

ABOUT THE AUTHOR

Eric Cornuel is Director General and CEO of EFMD

The first EFMD Higher Education Research Conference took place at The Lorange Institute of Business in Zurich, Switzerland, from February 14 /15 2012. The main speakers, whose research work and that of their colleagues informs this article, included: Jon Billsberry Deakin University, Australia Stéphanie Dameron Paris Dauphine University, France Jürgen Enders CHEPS (University of Twente), the Netherlands Fernando Fragueiro IAE Business School, Argentina Ulrich Hommel EFMD and EBS Business School, Germany Peter Lorange The Lorange Institute, Switzerland Peter McKiernan Strathclyde Business School, University of Strathclyde, UK Andrew Pettigrew Saïd Business School University of Oxford, UK JC Spender ESADE and LUSEM Spain and Sweden Ken Starkey Nottingham University Business School, UK Howard Thomas Lee Kong Chian School of Business at Singapore Management University, Singapore David Wilson University of Warwick, UK

52 www.efmd.org/globalfocus

n milamumbai fusion SDA BOCCONI LINKS MILAN AND MUMBAI

In July SDA Bocconi, the leading Italian business school, will open a new school in Mumbai, India. Stefano Caselli explains how the partnership to create the school came about and how it is likely to develop in the future

Milan Mumbai fusion: SDA Bocconi links Milan and Mumabai By Stefano Caselli

53 EFMD Global Focus | Volume 06 | Issue 02 2012

DA Bocconi started exploring the opportunity of launching a new venture outside Italy some years ago when an internal task force identified several concrete overseas options.

Those options were wide as the school has excellent international exposure in many countries around the world. However, the choice went to India and specifically Mumbai. The rationale behind the decision was to launch a new strategy in a well-known country. In other words, SDA Bocconi’s entry into the Indian market is based on two strong pillars: in-depth research and strategic analysis and an existing strong network inside the country.

SDA Bocconi has been working outside Italy for many years, both recruiting candidates eligible for its MBA programme in Milan and launching executive programmes tailor made for corporations, financial intermediaries and public administrations. India represents a further and relevant step to enlarge significantly its presence in the Asiatic region, based on the strong fundamentals of India. Expected GDP growth, a strong entrepreneurial background, impressive numbers of students demanding high-quality education, and demographic and social trends are the key drivers of India’s educational attractiveness. For many years SDA Bocconi and Università Bocconi have been building a relevant presence in the Indian market through several activities, including double-degree alliances, exchange programmes with leading schools, recruiting for all educational programmes held in Milan and opening a representative office in Mumbai. This liaison with the Indian market is a fundamental requirement to starting the new venture, named MISB Bocconi, but the cultural links and strong similarities between Milan and Mumbai are even more fundamental to creating a successful venture. Milan is a city that represents a blend of culture, business and finance and Mumbai is the same; furthermore, Milan is an incredible platform to leverage people towards Europe and Mumbai is an incredible platform to leverage people towards India and Asia. In addition, some characteristics of the economic system promote these similarities between the two cities. For example, the presence and importance of family businesses, the large number of SMEs, the large retail banking system and the transition from state control to an open market.

2 SDA Bocconi’s entry into the Indian market is based on two strong pillars: in-depth research and strategic analysis and an existing strong network inside the country

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Within this context it is necessary to highlight • Respectful of the Indian culture because that a further relevant factor to enhancing the project is based on the creation of a mixed faculty where SDA Bocconi the decision and willingness to go through professors will work together with newly with the new venture has also been the recruited Indian faculty staying in Mumbai presence of energetic and gifted Indian and in India. For that, a strong commitment entrepreneurs who have co-operated with from SDA Bocconi faculty to devote a SDA Bocconi to create MISB and, among portion of their life to stay in Mumbai them, a SDA Bocconi MBA alumnus willing for MISB is a prerequisite for an effective to give something back to the alma mater. presence and a guarantee of quality. This co-operation with Indian partners has produced a lot of value and provided a bridge The MISB adventure will start on July 2, launching the PGPB, a full-time programme between SDA Bocconi’s view of the Indian delivering top-class management education. market and the culture and framework of the Indian business community and society The first edition will end in spring 2014. in general. The programme aims to build responsible,

40 The principle behind the venture in Mumbai will follow the concept of an “urban campus” as SDA Bocconi has been for 40 years in the heart of Milan

MISB Bocconi represents the first step in establishing a long-term presence for SDA Bocconi in India. The creation together with Indian partners of a new school located in Mumbai aims to provide a solid, innovative and concrete presence respectful of the Indian culture. • Solid because of the benefit of the wide and robust expertise of SDA Bocconi faculty that has been built through many years of international teaching and research. • I nnovative for the idea of positioning the school as a dynamic bridge between students, faculty and corporations, continuously sharing their energies, needs and experiences in the very heart of Mumbai, following the concept of an “urban campus” as SDA Bocconi has been for 40 years in the heart of Milan. • Concrete because the start-up of the school is based on a single programme, the Post Graduate Program in Business (PGPB), to focus all the effort on one excellent course before progressively building a larger portfolio as the community around the school becomes larger.

reliable and effective business leaders. It gives participants the chance to start a successful career or to enhance their work experience by nurturing personal growth and fostering professional development. It offers the experience, the international outlook and the multicultural environment essential for an international career in a global economy. The combination of theory and practice encourages students to have a creative and problem-solving approach; the international exposure educates them to succeed at a local and global level as well as to have a grasp of cultural intricacies. In a nutshell, MISB will educate people to combine strong Indian roots and Indian culture with a global view. To meet the characteristics of the Indian market, the PGPB is devoted to students exiting college and having only limited work experience, ranging between a couple of months and one to two years. This positioning is related to the fact that students leaving colleges have a strong but theoretical knowledge – in many cases in the economic and managerial disciplines

55 EFMD Global Focus | Volume 06 | Issue 02 2012

Milan Mumbai fusion: SDA Bocconi links Milan and Mumabai By Stefano Caselli

â&#x20AC;&#x201C; and their ambition is to enter the world of business as managers or to start their own companies. The latter is strongly supported by MISB. The PGPB programme draws heavily on the curriculum, research outputs, faculty and experience of SDA Bocconi. It is an innovative mix of lectures, international experiences and connections with industry where the key words are intensity, connection and international exposure. PGPB is an intensive academic programme covering all the business management fundamentals in over 1,000 class hours moving from the fundamentals of management and entrepreneurship to a wide portfolio of elective courses in specific tracks and fields. PGPB has a strong connection with the corporate world supported by a compulsory internship/ summer project, the Corporate Connect sessions (which are mainly group works with companies) and the on-campus Placement Event and the Career Commencement School (CCS). The CCS is an innovative format. In the last two months of the programme, courses are designed and delivered together with practitioners who interact continuously with students and recruit them for jobs. For this reason, a strong network of corporate and financial institutions surrounds MISB to ensure strong relationship with the business and financial community. Finally, PGPB offers an intensive international exposure through the Campus Abroad programme (a one-month summer programme in several different destinations in North America and Asia) and an exchange semester in Milan to link the MISB and SDA Bocconi communities.

In a nutshell, MISB will educate people to combine strong Indian roots and Indian culture with a global view

ABOUT THE AUTHOR

Stefano Caselli is a professor of banking and finance at SDA Bocconi and project leader of MISB Bocconi.

56 www.efmd.org/globalfocus

Employee training and development is essential. But how can companies ensure it is effective and worthwhile? Lindsay Ryan provides some guidelines

IMPROVING THE IMPACT OF CORPORATE EDUCATION PROGRAMMES

High Impact: Improving the Impact of Corporate Education Programmes by Lindsay Ryan

ost organisations realise they need to spend money on employee training and development but few of them optimise their programmes and return on training expenditure. Even organisations among those highly regarded for investing in their employees admit privately there is more they could do to make their employee learning and development programmes more effective. As with most things, the better the upfront planning and preparation, the greater the impact and outcomes from a corporate education programme. With appropriate planning, an effective corporate education programme can play an integral role in helping an organisation achieve its strategic goals as well as • retain existing employees • attract new employees • develop the skills and capabilities of employees as well as the organisation as a whole evelop and facilitate succession •d planning • f acilitate innovation and ideas for new products, services, customers and processes. Rather than being reactive in delivering corporate education and training programmes, a more measurable and effective outcome will be achieved by being strategic during the planning stage.

With appropriate planning an effective corporate education programme can play an integral role in helping an organisation achieve its strategic goals

57 EFMD Global Focus | Volume 06 | Issue 02 2012

A strategic approach to corporate education When approaching corporate education and employee training from a strategic perspective, the starting point is to determine an organisation’s strategic direction and goals over the forthcoming three years. From these goals, the organisation needs to explore scenarios of possible future requirements and issues the organisation may have to contend with and the range of knowledge, skills and capabilities it needs to succeed in these different scenarios. With most advanced economies experiencing an ageing workforce organisations need increasingly to develop their future leaders and capabilities from within. As such, organisations need to step up their preparation and implement succession plans for key leadership and operational roles with an emphasis on developing the skills and capabilities of people within the organisation. Employee learning and development needs to be treated as a strategic investment and all expenditure on corporate education programmes should align with the goals and strategic direction of an organisation. To ensure the most effective outcomes from corporate education and training programmes it is important to secure the support of the CEO, senior managers and line managers. Therefore, when a training proposal is developed it should be presented as a business case so that key stakeholders can better understand and be encouraged to support the proposed programme. A business case does not need to be a complex document. Instead, a concise paper can provide a context and the reasoning for a particular programme and its link to the organisation’s strategic goals.

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A business case of one or two pages can outline • the learning objective/s • reasons for the programme, including new knowledge or skills required or current skills gaps • implications if the programme does not proceed • budget, timeframe and any special resources required • key stakeholder involvement, including CEO, executives and/or line manager/s • expected outcomes, including estimated return on training investment • how the programme will be evaluated

Line managers’ role in corporate education

KnowledgeAdvisers claims the success of any corporate education and training programme starts with the line manager.

A study by KnowledgeAdvisers in the US found that after participating in a training programme only 9% of people actually applied what they learned with positive results...

50% ... but over three-quarters of participants applied 50% or less of what they learned

A study by KnowledgeAdvisers in the US (“Scrap learning and manager engagement”, Chief Learning Officer, 29 March 2011) found that after participating in a training programme only 9% of people actually applied what they learned with positive results. Over three-quarters of participants applied 50% or less of what they learned. The study found that participants fall into three categories: • Participants make no attempt to apply what they learn •P articipants attempt to apply their learning but with no worthwhile results •P articipants apply what they have learned and get some positive results

The line manager needs to consider the case for training: • Assessing the suitability of each employee to attend a specific programme •D etermining whether the timing is right for each employee • Meeting with each employee and jointly establishing an expected learning and performance outcome and an action plan describing how the outcomes can be achieved • Assisting employees to prepare for the learning event After a training event, the manager should meet with each employee to review his or her action plan and provide feedback on the employee’s performance.

CEOs want more tangible information about the impact a programme has on their employees and the organisation

KnowledgeAdvisers emphasises the importance of a pre-training meeting and action plan developed jointly between the line manager and the employee. Without the plan, the outcome is likely to be a low return on investment as there is no context for the training programme and no adequate means of determining the outcome.

The success of any corporate education and training programme starts with the line manager

High Impact: Improving the Impact of Corporate Education Programmes by Lindsay Ryan

Evaluating corporate education programmes While most corporate education and training programmes receive some form of evaluation, CEOs increasingly want more than traditional information such as the number of employees who attended a programme, how many completed it, the overall satisfaction with the programme and, sometimes, feedback on the venue and/or catering. This information does not help CEOs to see the value they are getting from investing in the learning and development of employees. Instead, CEOs want more tangible information about the impact a programme has on their employees and the organisation. In 1959 Donald Kirkpatrick introduced his four-level evaluation model: Reaction, Learning, Behaviour and Results. Most organisations would use at least part of the Kirkpatrick model to evaluate their corporate education programmes, especially levels one and two. Dr Jack Phillips built on Kirkpatrick’s model with the Phillips ROI (Return on Investment) evaluation. This incorporated evaluation planning prior to a programme followed by data collection during a programme and data analysis at its end to compile a formal report that measures a programme’s impact. However, the ROI approach can be time consuming and expensive relative to the cost of a programme and is mainly suited to bigger budget, strategic and highly visible corporate education programmes involving large numbers of employees.

Success Case Method The Success Case Method is another means of evaluating corporate education programmes that is practical and relatively low cost. The Success Case Method evaluation is based on a recognised and validated research method developed by former university professor Robert Brinkerhoff. It involves all participants, or a representative sample of them, in a corporate education or training programme responding to a quantitative survey, usually online. Ideally, an independent evaluator should facilitate the survey so participants can respond honestly and confidentially as the survey asks for their name and contact number for possible clarification or exploration. The quantitative survey usually reveals a standard distribution of responses that indicates most people gained some knowledge and applied some elements of a programme. However, there are usually people at the two ends of the responses: those who gained a considerable amount from a programme and are applying their learning and those who claim they found the programme of no value or they already knew all the programme content or they are not applying any learning. These two extreme clusters of respondents are then interviewed by an independent evaluator to explore the factors that enabled or enhanced their learning experience and the barriers that restricted their learning and the impact of the programme. The Success Case Method broadens the focus from an evaluation of a programme’s content and delivery method to an evaluation of how effectively an organisation uses the learning from it.

59 EFMD Global Focus | Volume 06 | Issue 02 2012

Often the high impact, or lack of impact, from a corporate education and training programme has little to do with the actual programme content, learning materials or facilitator. A recent executive education programme evaluation using the Success Case Method, found • t he learning and transfer of knowledge is greater where the organisation had provided or created opportunities for employees to apply their learning • t he sooner an employee is able to apply their learning the greater the retention and use of their new knowledge and skills •a key barrier to effective employee learning is the lack of support from their line manager. The evaluation also identified the topics and modules of least and most value to the employees and how the employees are applying their learning to their job. The factors contributing to a successful programme are then written into a series of case studies for the CEO and senior managers to provide specific examples of how various employees are applying their learning, how the programme has helped them in their job, how it has enhanced their skills and knowledge, and how the programme has had a positive impact on the organisation. Similarly, case studies are compiled that identify barriers to the application of the learning in the organisation so the CEO and senior managers can take steps to alleviate those barriers in future corporate education and training programmes.

ABOUT THE AUTHOR

Dr Lindsay Ryan is Director of Corporate Education Advisers, an Australia-based corporate learning consultancy. He is the author of Corporate Education: A Practical Guide to Effective Corporate Learning published by Griffin Press, Australia, 2010; ISBN 978-0-646-52812-0. Dr Ryan is also Visiting Fellow in Corporate Education with Birmingham City Business School in Britain.

60 www.efmd.org/globalfocus

EFMD 2012 | www.efmd.org/conferences

Upcoming events April 2012

September 2012

October 2012

November 2012

EQUIS and EPAS Accreditation Seminars

EFMD Advisory Seminar

2012 EFMD Executive Education Conference

EFMD Advisory Seminar

Dates / Venue

13 September / Brussels, Belgium

Dates / Venue

27 November / Brussels, Belgium

24-25 April / Hong Kong, China

Theme

3-5 October / Sevilla, Spain

Theme

How to Cope with Challenges in Programme Design

Theme

Designing and Implementing an Internationalisation Strategy

Interpretation and Practical Application of the Standards and Criteria HOST

The University of Hong Kong, Faculty of Business and Economics

May 2012 2012 EFMD Annual Conference Dates / Venue

13-15 May / Sophia Antipolis, France Theme

Beyond Maturity: Innovating in Management Education

HOST

EFMD Sharing Best Practice CLIP workshop

Effective Development of Executive Education

29-30 November / Beijing, China Theme

Theme

11-12 October / Nairobi, Kenya

TBC

Learning Inc ! The growth of learning and development consulting inside the L&D landscape

Theme

HOST

TBC

CEIBS

HOST

EDF Group

June 2012 2012 EFMD Doctoral programmes conference Dates / Venue

11-12 June / Cranfield, UK Theme

Global trends and alternative models HOST

Cranfield School of Management

HOST

Strathmore Business School and University of Nairobi

December 2012 2012 EFMD Masters Conference

November 2012

Dates / Venue

2012 EFMD Conference in the MENA Region

Theme

Dates / Venue

HOST

Theme

4-6 November / Beirut, Lebanon

Structuring Teaching and Research Incentives: How to Attract and Retain Faculty

Theme

Kemmy Business School, University of Limerick

EFMD Advisory Seminar

HOST

Business Schools in the MENA Region - Empowering the Next Generation of Leaders

EFMD

HOST

2012 EFMD Conference on Undergraduate Management Education

EFMD Advisory Seminar

HOST

EFMD

Dates / Venue Dates / Venue

25 September / Brussels, Belgium

Theme

2012 CEIBS â&#x20AC;&#x201C; EFMD Conference

20-21 September / Paris, France

SKEMA Business School

24 May / Brussels, Belgium

Instituto Internacional San Telmo

EFMD

2012 EFMD Africa Conference

Dates / Venue

HOST

Dates / Venue

HOST

EFMD Advisory Seminar

Partnering for Impact: New Business Models for Executive Education

Dates / Venue

26-28 September / Oslo, Norway

21 November / Brussels, Belgium

Theme

Mapping the Future of Undergraduate Management Education â&#x20AC;&#x201C; The Student, Faculty and Employer Perspective

Risk Management

BI Norwegian Business School

TBC

American University of Beirut, Olayan School of Business

Dates / Venue

HOST

3-5 December / Limerick, Ireland

HOST

EFMD

For more detailed information, please visit our website www.efmd.org under conferences and learning groups or email info@efmd.org

PETER DRUCKER SOCIETY EUROPE IN CO-OPERATION WITH THE DRUCKER INSTITUTE PRESENTS

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Key topiCs the Capitalist order under siege

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“The Oscars for ideas.” Costas Markides, London Business School

For more information on Thinkers50 sponsorship and partnering opportunities visit www.thinkers50.com or email sponsor@thinkers50.com for an information pack.

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Volume 06 | Issue 02 2012

EFMD

Giving back. Moving graduate management education forward.

Bharatiya Vidya Bhavan’s S.P. Jain Institute of Management & Research

The Regents of the University of California, San Diego, Rady School of Management

ESADE Business School

Università Cattolica del Sacro Cuore – ALTIS

Net Impact

University of Botswana, Faculty of Business

Pepperdine University, Graziadio School of Business and Management

University of South Florida St. Petersburg

SUNY Empire State College Foundation Syracuse University

Volume 06 | Issue 02 2012

CONGRATULATIONS TO OUR GRANTEES

Global Focus

The Ideas to Innovation [i2i] Challenge

EFMD aisbl

Email: info@efmd.org

$7.1 Million

Phone: +32 2 629 08 10 Fax: +32 2 629 08 11

Rue Gachard 88 – Box 3 1050 Brussels, Belgium

17 Transformative Plans 6 Countries 12 Grants

Needed: academic Triathletes

University of Texas at Tyler University of Waterloo, Conrad Business, Entrepreneurship and Technology Centre

FIND OUT MORE AND FOLLOW OUR GRANTEES’ PROGRESS AT

gmac.com/metfund

Today business schools need multifaceted and well-rounded faculty

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INSIDE THIS ISSUE China lessons John Quelch on 12 months at CEIBS

No copying Business schools must cherish their diversity

Forward looking Why we need leaders focused on the future

Doctor, doctor An inside look at studying for a PhD

Italy in India SDA Bocconi opens up in Mumbai

Top women How organisations can help women become leaders