From OUR EDITORIAL STAFF we have investigated what measures Business Schools are taking on a global scale so that their respective approaches are in line with the negotiation processes that will be integrated in the immediate future and also in the medium term.
There is a fact that caught our attention, because precisely in 1959 two reports were produced in the United States financed by two foundations considered rivals, Ford and Carnegie, which described the majority of American Business Schools as little more tan glorified vocational colleges.
What was this categorization due to?
Because these graduate institutions were seen as strong on the practicalities of management, but lacking the in-depth research approach that was the hallmark of serious academic institutions.
“More and more business educators are recognizing that it is insufficient to transmit and apply current knowledge. The function of higher education is also to advance the state of knowledge,” argued Robert Gordon and James Howell in their Ford Foundation-supported report: “A professional Business School that aspires to full academic status must pass this test.” And to advance in each era of history in any field of knowledge, research is required. But we emphasize from the AEEN that it must be serious investigations.
The 1959 findings prompted Business Schools to take research more seriously, but the tension that has always brewed between theory and practice does not seem to have been resolved since then. We do know that much progress has been made in this regard.
Now, as academics try to find their place in the debates convulsing business and investors about how to make capitalism more inclusive, both rigor and relevance are competing with a third priority: the responsability
Another fact that we have found and seems of great interest to us (this is more recent) is that when an international working group drafted the “UN Principles of Responsible Management Education” in 2006, its authors observed that no attempt to transform business education would succeed without challenging the research paradigms that dominate teaching in Business Schools. Hence, the warning made by the promoters of this study was that until then (that is, 2006), the research addressed the responsibility of management focused mainly on ethics, business and society, or corporate social responsibility. But they warned very clearly that “research that addresses the impact of business on society at large, critical analyzes of management responsibilities, and frameworks for assessing performance along nonfinancial dimensions remain a priority”. It is also true that from 2006 to date not much progress has been made in the programs and philosophies of Business Schools in this sense of covering other dimensions that are not strictly financial. And this is because, according to what can be deduced from the current situation, there are very few professors, for example, of finance, in the main Business Schools in the world, who think that sustainability is a credible topic.
There is work focused on real-world impact, from the BI Norwegian Business School studies that align with the UN Sustainable Development Goals to the study by Nancy Landrum of Loyola University, which showed how few sustainability courses prepare entrepreneurs for the realities of climate change. Yet some of the professors say research often continues to lag behind, rather than lead, the changes capitalism is undergoing.
Bob Eccles, Visiting Professor of “Management Practice at Oxford’s Saïd Business School” says that “unless they establish their reputation by some sustainability brand label, they’re not going to change”, referring to many academic colleagues, noting that for those who still make a name for themselves with a research approach that doesn’t fit neatly into mainstream disciplines like strategy, management, finance or marketing, it becomes a bit tricky to break into the core of business school research. In other words: resistance to change.
When Tensie Whelan, former president of the Rainforest Alliance, joined New York University’s Stern School of Business, she went on the condition that she establish a center to support serious research on sustainability.
Now that she heads Stern’s Center for Sustainable Business, she says, “I’m looking to design research that will help us better understand how to best design the next stage of capitalism.”
A highlight of that work is a novel methodology called “Sustainability Return on Investment,” which empirically shows what factors drive sustainable business performance.
Professor Whelan has also focused her research on research itself. In a forthcoming journal article, she and her colleague, Tracy Van Holt, review some 65,000 academic publications to assess whether the research reflects the same level of focus on integrating sustainability into core company operations that we now see in the business community.
They found that there was a visible increase in the number of such studies around 2015, but concluded that the research had not yet comprehensively addressed this question.
One obstacle is the importance of getting research accepted by prestigious journals.
In 2006, the UN task force concluded that as long as major journals maintained their “natural bias” against topics outside their traditional purview, “young professors would be ill-advised to invest in alternative research paths,” a clear reference to the fact that by doing so, they would jeopardize their ability to reach mainstream topics that are worth research for publication.
The publication hurdle remains high, says Professor Eccles: “For people to get promoted, they have to publish in major journals, and that’s hard.”
These concerns, however, have given rise to several initiatives designed to advance research that offers benefits to society.
Survive and thrive in the age of AI
Anne Trumbore, who is the director of “Wharton Online, The Wharton School, The University of Pennsylvania” referred in 2019 to what Business Schools were going to be like two decades from now. She said very interesting things, such as:
– Business Schools can survive and thrive in an age of artificial intelligence and automation.
– What Business Schools teach, how they teach it and to whom they teach it will change dramatically in the next two or three decades.
– Advances in artificial intelligence and automation will dramatically alter both the business and educational landscape. We can’t predict exactly how business education will evolve, but we can say that current methods of doing and teaching business will change forever.
How to deal with the paradigm shift
Anne Trumbore says that business Schools (always thinking about the near future) will have to be very attentive to three key factors:
a) Expand their student base to include employees who want to remain employable.
b) Reach out to corporations that want to provide education to their employees.
c) Reach students from all over the world who want to remain competitive in their own job markets.
Schools will have to work on developing content in areas that are slower to be disrupted by AI: leadership, ethics, communication, human resources, and social impact, among others.
But she also argues that Business Schools must develop proficiency in working with multiple technologies to deliver effective and engaging learning experiences, whether delivered using AI-enhanced platforms or through mobile devices.
At present (we agree with her based on our research), Business Schools produce two social goods: knowledge and educated students.
We would add: trained, since this is another of the historical objectives of business schools.
Knowledge production, in the form of faculty research, traditionally takes a long time to develop, reaches only a few, and is rarely profitable. The majority of revenue comes from tuition.
But precisely, in the future, “the production of knowledge will be faster, it will be widely distributed and it will be a center of profits equal to or greater than tuition. The new entrepreneurial scholarship will be distributed globally and at scale to new audiences who will never set foot on campus.” We can not agree more.
We also agree that many Business Schools have developed strong distribution capabilities to attract new audiences. In the case of the Wharton Business School, it has a radio station, a digital press, a business journal, a thriving online initiative with more than 225,000 paid or financial aid enrollments, a major executive business education, and three types of programs: undergraduate, that is, bachelor’s degree, MBA and executive MBA executive. And she clarifies that “many of our peers offer similar programs to a greater or lesser extent. As a group, we continue to respond to the advent of new technology and the growing need for business education beyond the degree. The next challenge will be how to address the drastic change in knowledge that students will need and how they expect to receive it.”
Her perception of this immediate future to which she refers in terms of the impact it will have on Business Schools is interesting, although the type of business (and of course business models) that there will be in a few years is not known with certainty, it is evident that there will be drivers of the real change that will take place in companies, society in general and, of course, in postgraduate institutions.
The growth of AI and automation capabilities will transform some industries, create new ones, and eliminate others. This sifting (adjustment of the economy and markets) is a natural process that always occurs throughout the life of business cycles. But it is also almost certain that there will be fewer knowledge workers, more low-paying service jobs, and more monopolies.
More analysis and with greater precision
Most types of business analytics, from financial to marketing to behavioral, will be done more accurately and for less money by using an algorithm. Most trading decisions will be simulated and optimized by machines. Successful companies will not be judged by the size of their workforce, but by the size of their data sets and the accuracy of their algorithms. A significant percentage of the jobs that today’s students go to learn in business School will no longer exist.
The rise of automation
Anne Trumbore believes that she joins a majority of experts who predict that increased automation will mean fewer jobs overall, with the main result being that wealth will be concentrated in the hands of a few. Which is why Business Schools will certainly play a role in preparing students for those jobs, assuming they can design relevant curriculum and hire experts to teach it. But for business schools to have value in the future, they will have to change what they teach and how they teach it.
The roadmap change
The current tradition of studying Internet and industrial age management practices will provide important historical context, but will not offer a roadmap for future success. Faculty experience in fields where machines outperform humans will be less valuable. New topics and issues critical to business success may emerge faster than the current cycle for faculty knowledge creation and dissemination, so faculty for these topics may not be traditional academics. The role of a tenured faculty member as a content expert will diminish, while the role of faculty members as mentors, guides, and teachers will expand.
Critically, Business Schools will need to create learning experiences that can differentiate themselves from the content-adaptive, personalized learning that AI can provide. Over the last decade, we have seen the power of technology to democratize business education. AI will not only improve the delivery of this content, but can also create learning experiences that Business Schools cannot compete with.
High quality online education
For schools to remain competitive, they will need to invest heavily in the ability to create high-quality online education that can be combined with AI-based delivery methods, as well as high-touch experiential learning that is relevant to tomorrow’s economy.
Solving social problems
During their studies, future MBAs must work to solve social problems, not just corporate ones. The current income inequality is quite clear that it will not go away just like that, it will surely get worse and will soon become a commercial and social problem. Business schools must begin to ask themselves what content they will offer to prepare students to face the costs of doing business in a context of extreme income equality and social unrest. Courses on impact investing, social entrepreneurship, business and legal ethics, and the soft skills of communication, negotiation, and influencing will be most valuable.
Stop thinking of students as students
This is not the first time that the issue of postgraduate education has been focused on, putting the so-called “lifelong learning” at the center of the debate, because it is either understood that today and even more so in the future, a student who later becomes former graduate student will have to continue to strive to learn throughout his life, especially during his active years. The only way to remain competitive and contractable by companies that in turn want to be more competitive.
Because knowledge production will be faster and distributed farther than ever before, students will expect their school to provide them with the relevant knowledge they need throughout their working lives.
Business Schools can play a critical role in a highly automated world powered by AI. To achieve this goal, they have to become more adaptable and responsive to new ways of doing business. To begin with, they must address the social consequences of these new approaches. They can start by expanding their course offerings, professional services, and student base, and become proficient in new technological delivery methods.
This information has been prepared by OUR EDITORIAL STAFF