We are going to do an analysis of the impact of Business Schools on business models, but we will do it precisely in this sense (because of the direction we are taking) not in the sense that one day in and day out we are talking about the impact that Schools must have in sustainable development. We have already dealt with this question in this forum in several articles.
Today we take a turn, and we will see when and how the business model of any company can be transformed thanks to the impact of Business Schools in general. Undoubtedly, if in this company in particular, there is a leader who passed years ago or even recently through an MBA program and has actively participated in his final degree project together with other professionals and especially looking for the practical application of his studies and the team of colleagues in some areas of interest of his company, without a doubt, the impact is direct.
But there is also a permanent indirect impact on the market, to which no specific project can be linked, but it is immersed in a global corporate market culture in which companies incorporate new management tools, new models of business that arise between the proven practical implementation and the highly experienced academic development in certain fields, such as marketing, human resources or financial management.
We must not forget that especially (and we have also said it in ad-hoc articles) the digital transformation (we are referring to its acceleration as a consequence of Covid-19) has also had an impact on the business models of organizations, which is why, without any doubt, it has forced companies to adapt rapidly like never before, therefore, also Business Schools, which although they were in better conditions than other sectors of the economy since they had been working on training online, years ago, they had to make one more effort in this regard. And without a doubt, despite all the ups and downs experienced in the last two years, the best testing ground (laboratory of ideas and implementations) to understand the evolution and new scenarios of business models continues to be (and will be in a immediate future) Business Schools.
In the management of Schools, both at European and global level, there is a certain consensus on the issues that they consider have an impact in general, not only on business models. We also know from all the recent research that has been carried out in this regard, that even in spite of speaking of global impacts not limited only to business models, opinions were divergent about what to emphasize and how to evaluate the most important initiatives that these postgraduate institutions should prioritize.
When we refer to global impact, we must take into account various categories that are part of the essence of Business Schools, such as research, teaching, student projects and operations of the Schools themselves in various fields, especially in recent years, in terms of sustainability.
Let’s go to the direct impact
Undoubtedly, from the very moment that postgraduate education had to begin to demonstrate, a few years ago, the importance of its social purpose and if it really lived up to the times, a series of broader social initiatives that involve working with local communities have been taking place, that involved working with local communities, given, as we have also argued on previous occasions, the importance that a postgraduate institution has for the social and economic development of a region.
But when we see that they want to label which specific fields they have an impact on, prominent issues emerge that include initiatives in the workplace, the vast majority related to the well-being and inclusion of staff and students, with health support programs physical and mental and financial help to support those in difficulty. So the question arises: do these actions have a direct consequence on business models? The answer offers no doubt. Of course, yes, because if there is something that needs to be adapted transversally in organizations and Schools, it is the new social sensitivity that is becoming more and more ingrained in both business and curricular content design policies.
In other words, in short, the new business models have to collect all these influences that arise from that greater sensitivity for social, in addition to sustainable. This, in short, is the adaptation of conventional business models to sustainable models, but with the due clarification that from a technical point of view, they have to be financially and economically feasible, not only socially. This is what we criticize when the currents of opinion put on the table an excess of sustainability without making the substratum (the substratum or essence) even minimally feasible in its economic aspects, because then, unfeasible projects that can be carried out with high social costs in the medium and long term, which, as always, will end up being paid by the most vulnerable and disadvantaged, an issue that was not intended to go in this direction at the very basis of the reasoning. In other words, an inverse effect would be achieved, which of course is not in the spirit of any business school management that boasts of being minimally respectable.
Business models and future generations
Forms are important, but more so is the background. Therefore, regardless of how postgraduate institutions are defined with respect to this impact approach that we make today, there is no doubt that many
Business Schools are playing an important role in helping to prepare future generations for a series of functional roles (in companies) and social (because of their impact on the decisions they make as managers). In other words, they have an impact on the business model and on a new kind of leadership, which altogether already has a different tenor and social responsibility for Schools.
We believe that next steps can go along the line of making all this effort not spontaneously (colloquially we would say without thinking too much), but doing it more systematically and completely, while encouraging others to do more.
Who are these others?
The force generated by this change in model, which is having an impact on the business models of the market, is of a centrifugal type, because it invades the entire field of professional action of companies, individuals and postgraduate educational institutions.
The notion of impact is becoming important for international business schools
When the importance of responding both to society as a whole, and to the daily life of companies that mostly need people with higher levels of education and training is assumed, it is undoubtedly a form of antidote against these currents of opinion that at the international level they are exerting strong pressures related to the legitimacy of postgraduate institutions. Although the term impact has gained popularity, common approaches to Business School impact are based on academic publications or alumni salaries. There are no specific measurements or economic indicators that respond to the orientation that we give, except for some investigations and also surveys, of which we have given note in this forum. But it is time to build these metrics as other types of econometric models are built, that is, methodologically.
Reviewing a little the various approaches that exist in the market and especially in the doctrine, allows us to develop (at least try to lay the foundations) of new conceptual models regarding the impact of Business Schools, both in their total contribution to society, as circumscribed only to business models.
The pluralism of approaches in terms of impact of the Business Schools opens new spaces for original strategic choices, so that there is a limitation for those focalizations that continue to hover around too much discussed issues in the organizational field. However, the notion of impact also has some limitations that must be considered, even more so when postgraduate training received in Business Schools was put in the spotlight since the International Financial Crisis of 2008-2009, at which time the criticism was why these educational institutions did not fulfill their main purpose of producing professional managers (Rousseau, 2012) and accused of producing irresponsible leaders (Chakravorti, 2014), arrogant MBA students and narcissistic professors (Chark, 2014; Pfeffer, 2013 ).
They have also been criticized for producing research considered to be costly waste (Di Meglio, 2013).
On the other hand, there seems to be a growing intellectual interest in the question of the impact of Business Schools (Pfeffer and Fong, 2002), but there is little, if any, scientific work on the broadly defined notion of the impact of Business Schools. We assume that one of the reasons for this is that the notion of impact is difficult to understand and to assess and/or assess in a unified framework.
New models and changing contexts of the business school
Any time may be an opportune time to undertake a critical examination and evaluation of new models and innovative new approaches to management education. We are going to incorporate into this new scenario what we call “Relevant factors to impact new business models”.
An exhaustive statement cannot be made, but in order to merely describe the situation, we have that certain factors must be taken into account:
– Changing business environments
As the old adage goes, “nothing is the way it was then and never will be again”. More than enough reason to understand that the stable and growth-oriented business environment of the past is not only changing, but in its traditional conception is outdated.
More developed countries have fewer undergraduate and graduate students. Even the relatively stable executive education market appears to be in recession. Although it could be argued that market conditions are improving, an alternative point of view might suggest that the situation is instead one of lower demand, more turbulence and more market-driven cycles.
– Acceleration of the adaptive processes of schools to the new scenarios
Speed and agility are becoming more essential, and old stability-based management approaches are less appropriate. This relates both to changes in the curriculum and to faculty responsiveness to new topics, new research, and new competencies.
– Greater emphasis on projects
Perhaps in part due to more difficult times, it seems that graduate and undergraduate students and executives are demanding a greater emphasis on projects, which requires a more eclectic curriculum. For example, the development of a new product involves the areas of R&D, marketing, sales, manufacturing and finance. Similarly, entering a new market involves marketing and sales, as well as communications, manufacturing, logistics, legal expertise, etc. Therefore, close and rapid cooperation between disciplines becomes very important.
– Avoid obsolescence of curricular content
The traditional functional and discipline-based curriculum design is becoming increasingly obsolete. The demand for more general MBAs may well continue, perhaps after you have taken an M.Sc. specialized, provided that academic institutions design appropriate and meaningful links between specialized and general management degrees and maintain academic standards and norms of strong quality in their program offerings.