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Showing posts with label Master of Business Administration. Show all posts
Showing posts with label Master of Business Administration. Show all posts

Saturday 3 December 2011

Only Capitalists Can Save Capitalism


English: Harvard Business School, as seen from...Image via Wikipedia


Maggie Starvish

If capitalism was a stock, the market would appear rather bearish on its future.

Bank failures, economic crises, and middle-class riots across the globe appear symptomatic of large systemic weaknesses in the market system, highlighted by the 2008 global financial meltdown. Income inequality separating corporate leaders from their rank-and-file workers has become a hot-button issue in the upcoming presidential election. And in public opinion polls, business moguls are cushioned from the bottom of the reputation scale only by members of Congress. Fixes so far have largely eluded elected officials, government regulators, and tent city activists.

Capitalism at Risk: Rethinking the Role of BusinessBut there is one group of citizens with the power to make a difference: business leaders themselves, say Harvard Business School Professors Joseph L. Bower, Herman B. "Dutch" Leonard, and Lynn S. Paine, authors of Capitalism at Risk: Rethinking the Role of Business.

"Our book argues that if we don't begin to address, in a systemic way, the issues and problems and the negative outcomes and challenges [of market capitalism], then we are likely to see a lot more movements like Occupy Wall Street," says Leonard.

Capitalism at Risk grew out of preparations for Harvard Business School's centennial celebration in 2008. Bower, Leonard, and Paine felt it important to identify key issues that HBS should focus on going into its next 100 years, so they organized a series of forums on four continents with top business leaders, many of whom were HBS alums. "We set up the forums as opportunities for candid discussion among peers," says Paine.

The principal question asked of each participant was this: "If we stipulate that the system of market capitalism has been the source of remarkable economic growth, what are the prospects for continuing growth in the future? What aspects of the system at the level of firms, industries, nations, or multilateral institutions might cause serious difficulties?"



The principal response is summed in the book: "Market capitalism has proven to be a golden goose providing historically unimaginable economic benefits to many, and if we don't look out, we may kill it."

From prediction to fruition

Problems that forum participants cited included environmental degradation, trade breakdowns, and failure of the rule of law. Concerns over the lack of transparency into and oversight of the financial system were voiced by many. In all, 10 potential disruptors of the global market system were identified.

"One of the things we were told even before the economic crisis was that the financial system had grown to such a scale and was functioning in such a way that it was no longer necessarily lined up with the needs of the industrial system, or the way society wanted it to function," says Bower. "And lo and behold, we now have a crisis that illustrates what they were concerned about."
"If you believe that the problems ahead are likely to be very serious, and neither government nor business can address them, that doesn't leave you with many options."
—Lynn Paine
"Perhaps we should credit the participants in our forums for their prescience," notes Paine, reflecting on an e-mail she received recently from a participant on how much the world had changed since 2007. "The question now is whether we can mobilize business leadership on a sufficient scale to make a difference."

"Our view is the system could go, if companies don't step up," says Bower. "It's companies that have the skill sets necessary to go from a vision to making something a reality."

Considering the number of corporations whose annual revenue is larger than the GDP of many small countries, the proposition makes sense. The authors argue that the problems are systemic, and who better to attack huge issues than people who run small, medium, and huge organizations.

Bower, Leonard, and Paine are prepared to have their views challenged. Even some of the forum participants, says Leonard, "didn't think what we are calling for is either appropriate for or likely to come from business and business leaders." And while Leonard agrees that some of the criticisms are valid, "the alternative of having business sit this one out is too risky."

Adds Paine: "Of course we recognize that there are serious obstacles to the view we recommend," including a lack of structure, tools, and incentives within businesses to do the sort of work that's needed, and a lack of skills and incentive on the part of business leaders to operate on the global political front. "But we see those as challenges to be overcome rather than fatal flaws in the idea. If you believe that the problems ahead are likely to be very serious, and if you believe that neither government nor business can address them, that doesn't leave you with many options."

"There is clearly political content to what we are suggesting," says Bower. "We talk about the need for leaders of companies to develop skill sets that they might not have—a lot of our business leaders have not been brought up to be comfortable in dealing with politicians. So part of what we're talking about is learning how to operate in the public arena without getting into trouble. It's hard."

Addressing the problems

HBS has made significant strides in preparing students to be the kind of leaders that the book calls for, says Leonard, noting as one example the required first-year MBA course Leadership and Corporate Accountability. "Where I think we still have far to go is in teaching the skills for operating in the high-conflict, low-authority zone outside your own firm. Most of what we teach is about how to optimize within your firm, where you tend to have a high level of authority and where there is general agreement on goals.
"Where I think we still have far to go is in teaching the skills for operating in the high-conflict, low-authority zone outside your own firm."
Dutch Leonard
"By contrast," Leonard continues, "when our book calls on business leaders to exercise leadership outside their firms, we are inviting them to operate in a domain where they have little authority and where there is great conflict over what the most important goals are. The skills to do this involve what we might call small 'p' political skills—and we don't teach nearly as much of that as we could and should, nor do we have many cases about business leaders operating in that high-conflict, low-authority domain."

Giving students a broader perspective outside the HBS classroom is another possibility, such as pairing B-school students with other Harvard students who are studying similar big problems, says Paine, who cofounded and served for five years as course head of Leadership and Corporate Accountability.

"For example, I have in mind a course that would bring together students from HBS, Harvard Law School, and the Kennedy School to explore, as board members and as leadership teams of companies, what could be done … both through innovative business strategies and through innovative institutional arrangements."

According to Paine, many HBS students share the concerns voiced in the book and aspire to the type of entrepreneurial leadership needed for reform. "It's critical that we harness the energy and ideas our students bring to these challenges, and that we as a faculty help them develop the skills and capabilities needed to practice this kind of leadership."

So even as the market system has created threats to its own sustainability, it can also reward enterprising companies of any size that can turn these problems into opportunities. The book provides examples of business efforts that promote social good without sacrificing profit: a mobile communications rollout in rural China that "extended the benefits of participating in the market system to millions of people" while increasing profits and growth at the country's largest telecommunications firm; "a boutique asset-management firm that invests in companies whose business models are aligned with the needs of a sustainable global economy."

But Capitalism at Risk leaves a lot of the heavy lifting in the hands of business leaders. "We're pretty clear that we don't have all the answers," says Bower, "but we're also pretty clear that we need action."

The form that action takes remains to be seen. But it's worth noting that while members of the "Occupy" movements may be retreating for the winter, the problems they have highlighted are likely to remain with us for some time.

About the author:Maggie Starvish is a writer based in Somerville, Massachusetts.

Related post:

We need to talk about capitalism, say CEOs

Monday 1 August 2011

Going global – a new breed of executive MBA






Matt Symonds 

BY Matt Symonds

The world’s top full-time MBA programs have enjoyed several years of rising applicant numbers, fuelled by the struggling economy and strong international demand, notably from Asia. But with an improving global jobs market, many schools are now seeing a fall in full-time MBA applications. However, what may be bad news for one part of the business school portfolio, is likely to be good news for another.

With no need to sacrifice your job, the Executive MBA is looking like a sound investment for seasoned managers with an eye on a place in the C-suite. The most recent survey conducted by the Executive MBA Council reported a 3 per cent increase in enquiries on the previous year. Despite one or two notable exceptions (the Harvard Business School and Stanford GSB are yet to offer an EMBA course) it appears that schools around the world have been taking note, and placing international expansion and global business practice at the top of the executive agenda.

Trium, a Global Executive MBA programme run jointly by NYU-Stern school, HEC Paris and the London School of Economics, is celebrating its tenth anniversary by adding a second cohort in 2012. “We are now expanding this program because both the need and the value of having a global perspective have increased in the intervening decade,” explains Bernard Ramanantsoa, Dean of HEC Paris. “The program integrates international economic, political and social policy into the business curriculum, which are aspects often neglected in traditional business curricula yet are widely accepted as critical to successful global business.”

More companies are also turning to business schools to help develop managers who can lead teams in a global business environment, and consider programs such as OneMBA, a partnership of five leading schools on four continents, as part of their institutional training platform. For Craig James, a Global Controls Advisor at ExxonMobil, the Global Management and Leadership course on the OneMBA program, helped strengthen his cultural awareness, and enabled him to more effectively manage global work teams.  “I took what I learned on the weekends and applied it on Monday mornings.  My OneMBA global study team was a mirror image of my global team at work.”



Another benefit of the modular delivery format favored by the new wave of executive MBA programs is that distance from the campus is no longer an issue. The University of Cambridge’s Judge Business School recently launched its own EMBA and is already welcoming students from far beyond its UK location. The program brings students together once a month, supported by a virtual learning platform, and has meant that students in the first class include a VP from the Walt Disney Company, who makes the monthly commute from Los Angeles.

At first glance therefore it may appear that the global learning initiative has been seized by European schools. Spanish school IESE has recently announced a new EMBA programme based in Sao Paulo, to help develop executives across Latin America. The London Business School now offers it’s Global EMBA in both London and Dubai, as well as a joint programme with the Columbia Business School and Hong Kong University, while rival school INSEAD has further expanded its global footprint, adding an Abu Dhabi campus to existing EMBA options in Fontainebleau and Singapore. In addition to Trium, French Grande Ecole, HEC Paris offers no less than five locations for their executive MBA, in Paris, Beijing, Shanghai, St. Petersburg and Doha in Qatar. The school ensures that all participants follow the same core curriculum and receive the same fundamental content, regardless of where they enrol. Pierre Dussauge, academic director of the EMBA, says the benefit of this is clear. “Our aim is to build a strong participant network across all five locations. If a participant is based in France, but completes a module in China, Russia or Qatar, he or she will be able to build a network of peers around the world.”

But US business schools are determined not to be left behind. The Darden school at the University of Virginia launches its GEMBA in August this year with a clear aim to bring students to the five key markets they feel will figure most prominently in shaping business in the coming century: China, India, Brazil, the US and Europe. Maureen Wellen, Assistant Dean of the Global EMBA Programme at Darden confirms that the program was driven by clear demand from the market, “We asked a lot of people around the world and there was definitely an appetite for the school’s expertise globally – especially from people who were unable to come to Darden for the two-year residential program. Also, it’s clear that students in both the US and abroad want to attain a level of global literacy that most traditional programs simply cannot offer.”

The school’s dean, Bob Bruner, adds to this sentiment. He recently chaired a report by the AACSB accrediting body entitled The Globalisation of Management Education, which suggested that the trend for global programmes is only going to continue on an upward curve. He says, “Business schools have been slow to react to the growing importance executives place on international experience. The rate of globalisation is only going to increase and it will be a disruptive force for which many more managers need to prepare.”

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