Hack:
Powerful Quick-Fix for the MBA

By Cristian Mitreanu - Founder / Product and Marketing Lead at BizBigPic, RedefiningStrategy.com

February 25, 2011 at 12:12pm

Moonshots

Enlarge the frame of management education

Rethink the philosophical foundations of management

Summary

As we wait for a new theory that would allow us to integrate currently disparate concepts and generate a more realistic business big picture, there is one easy and powerful solution for the MBA program: introduce a mandatory class of history of business and economic thought.

Problem

The biggest problem with the conventional MBA programs -- you can’t create managers in the classroom -- is inherent. In general, a lower graduating age means more time available to advance up the corporate ladder, which further means an increased probability of a successful business career. In addition, an increased number of success stories means a larger applicant pool (which also tends to push the average age lower, where managerial experience is low). And so, as long as schools can show some sort of causality between the MBA degree and a successful career, this cycle becomes self-reinforcing. The advent of the Internet has made this causal relationship increasingly elusive. Not only that the knowledge taught in school has a lower value due to its widespread availability, but the limitations of our general understanding of how businesses work is becoming more apparent. And this, as one of the main drivers behind the value proposition of the conventional MBA program, will prevent the current revamping efforts undertaken by many schools from having any meaningful impact. A true overhaul will only occur when the business management body of knowledge successfully makes a significant leap forward.

Solution

Practical Impact

In spite of the underlying implication of the word “history,” this class should be more about thought and historical circumstances, than about the completeness of the record. If developed and implemented in harmony with the rest of the program, the “history” class could have a significant impact on three dimensions.

First, it would help students acquire not only a dynamic perspective of the business world, but also a better understanding of how various concepts are related or fit together.
Second, the class would provide a platform that would “nudge” students into thinking critically about existing concepts, and further into creating their own.
Lastly, the new capability of providing students with the more advanced skill of understanding the big picture could be a significant source of competitive advantage for any MBA program.

First Steps

If a business school (or other type of organization, which provides business training for its employees) would like to test this hack, they should begin with the designation of a person or commission that would run the investigation. Then, they should organize a two-hour session, in which one or two of the most common business frameworks (i.e., Porter's five forces) are being presented from a historical perspective. The students would be explained the general business knowledge environment at the time when the framework emerged, how it gained popularity, what are its limitations, etc. Finally, qualitative data should be collected at the end of the class to assess whether or not the the students feel more enlightened.

Important note: The above-mentioned test should focus on second-year MBA students (or experienced employees, in case of other organizations), because their broader knowledge base allows them to be better judges of the value provided by the "history" session. Nonetheless, when implemented, the semester-long class should be offered to the first-year MBA students.

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March 8, 2011 at 10:45am

Chris Grams

Hi Cristian-- I was watching the movie 180 degrees South last night (http://www.180south.com ) and as I read your post today, it reminded me of a quote from Aldous Huxley used in the movie to make a point: "Men do not learn from history...that is the most important lesson history teachers us." As depressing as that quote may seem, it is probably a proof that people don't study history and thus are, to stay on the quote train "condemned to repeat it." http://en.wikipedia.org/wiki/George_Santayana I was a history major in college, so maybe I'm predisposed to like your point of view here. It does make me wonder about the current state of teaching business history in MBA programs. As someone who has never been to business school, I'm wondering if others who have attended could comment about how well versed they feel in the history of business, including the big mistakes and successes over the centuries, by the time they graduate? Glad to have you here on the MIX! Thanks for pointing to your blog too, looks very interesting… another Henry Mintzberg fan!!

January 6, 2012 at 1:11am

Cristian Mitreanu

Thanks, Chris. And sorry for my late reply.

Just want to make the distinction between business history and history of business thought.

Although business history is not typically part of the core MBA curriculum, it has been around for quite some time (see http://en.wikipedia.org/wiki/Business_history) and it is probably available as an elective class at some schools. Nonetheless, many aspects of business history are already embedded in business cases, books, and even films. But the reason it doesn't become more mainstream, I think, has to do with the fact that clearly identifying successes and mistakes, and what caused them, will always be a difficult feat. There's the subjective ("History is written by the victors") factor -- authors tend to cherry-pick and massage their examples in order to support their theories. And then, there's the objective, more significant factor -- we simply don't have access to all the information. Now, if we put this in the context of the "fast and furious" structure of the conventional MBA program, business history doesn't seem to be a strong candidate for the core curriculum.

History of business thought, the way I see it, would be a class where students can learn about the historical circumstances that surrounded the emergence/discovery and adoption of various business concepts. Only with that understanding, can students see limitations and challenge old beliefs or frameworks. If nothing else, it would prepare them to ask the right (and big) questions... And such class, I believe, should be part of the core curriculum, as it would complement other core classes/disciplines (i.e., Strategy, Marketing).

Btw, the documentary that you mentioned is high on my list, but still haven't had a chance to watch it...

March 13, 2011 at 5:43pm

Ken Everett

Excellent idea, Cristian!

Given (a) that an MBA is no better and possibly worse preparation for a career in management consulting (views of BCG and McKinsey as quoted in Stewart, The Management Myth) than degrees in philosophy, medicine, law, etc. then it seems to offer no real advantage, and (b) that the 'fathers of management science' (Taylor, Mayo, etc.) have been exposed as anything but 'scientific' and (c) that recent events suggest that what we have been teaching is, not doing much good, there is a prima facie case for redesigning the b-school curriculum. Sugestions? Philosophy, The History of Money and Business, The Scientific Method, Network Science, Psychology, Psychology, Ethics, and Practical Communications.

January 6, 2012 at 12:11am

Cristian Mitreanu

Thanks, Ken. (And sorry for my late reply -- 2011 was quite a year for me...)

a) Yeah, being highly analytical is very important for a consulting career; and that is not a skill/trait that is limited to the MBA programs. Besides, some of the top consulting firms have their own frameworks and methodologies...

b) I personally believe that the "science or non-science" argument is a false dichotomy. Sure, areas of inquiry which we typically call science (i.e., physics) might have higher degrees of precision and predictability. But, at the end of the day, there is no such thing as absolute truth... (For more on this fascinating discussion, I would recommend watching a recorded interview with Hilary Putnam -- "Hilary Putnam on the Philosophy of Science," YouTube: http://youtu.be/cG3sfrK5B4E.) And that's why I think that the main focus when analyzing a particular piece of knowledge should be its value/utility to the user (i.e., "Does this framework help you be more efficient?"), as well as its limitations (unfortunately, this is not typically emphasized enough).

c) I think that eventually we'll see some sort of specializations at the higher levels of business education (i.e., some type of PhD for the business world). The more general business education (read knowledge or content) -- similar to what the MBA programs are trying to deliver today -- will become increasingly commoditized, reaching broader segments of the population and lower age groups. Of course, for that, we will have to make some progress in terms of general knowledge, which in turn will enable new distribution models (business models).

March 28, 2012 at 12:15pm

Mohd Shahnawaz

What is common between Nucor, Whole foods, Tata and Gore Industries? Non of the founders have been to an MBA program but they have done something very amazing - built a great culture by understanding the main element which makes any company successful and sustainable - venue for the people to express better.

Cristian I wanted to ask you a question, I have been admitted to some MBA schools and have done numerous informational interviews and am still doing. After meeting numerous partners, I did not like the niceness and show over substance in many strategy consulting firms. MBA is such that if one does not go to top schools it is basically useless and top schools charge lots of money.

My main aim is to get into small to medium Industrial management where I can play important role in change. How do I get my foot to the door?

April 15, 2012 at 4:46pm

Cristian Mitreanu

Hi Mohd,

I appreciate you reaching out to me. Unfortunately, I don't think that I can be of much help to you -- at least, not in the sense of offering advice that will guarantee you "getting your foot in the door." One thing that I like to emphasize in these situations is the fact that we live in a probabilistic world. In other words, there are very few certain things in life. And, when it comes to one's professional development and career, there might be none. So, yes, you can make particular decisions, like attending a top business school, that may increase your chances of attaining your goal, but it will never happen with a level of 100% certainty. And that is true for the opposite -- even without attending a business school, it is possible to become a business great.

Sure, there are problems with the conventional MBA programs, problems with how companies recruit their talent, and problems with how we assess one's professional expertise. Unfortunately, that is not going to change anytime soon -- at least, not in the society at large. While human nature with its "imperfections" is one of the main culprits for this state of affairs (the other culprit is the fact that our understanding of business continues to be fairly limited), it is also human nature that provides a way to deal with it: Networking. The saying "It's not what you know, it's who you know (that matters)" remains as relevant as ever, whether we like it or not.

In conclusion, I would advice you to focus on communities (networking). If you are going to attend an MBA program, in addition to looking at their curriculum, faculty, and rates, pay close attention to their relationships with the business world. If there are no visible ties with individuals who are active in "small to medium industrial management" roles or companies that you find attractive, then it is most likely that you are going to be on your own after graduation. If you are not going to attend a business school, look for professional communities (i.e., associations) that have ties to the companies that you are targeting. In such cases, your geographical location could play an important role -- your professional networking efforts are much more effective if you can actually meet people in person.

I hope this helps. Good luck!

Cristian