Guest Post from Johan Roos, Dean, Jönköping International Business School, Sweden
I think it’s time for us to admit that the critics have a valid question: Why aren’t business schools changing faster to keep up with changes in the business world?
Recently I attended two gatherings for business school deans where this question surfaced center stage. The first was the EFMD Conference for Deans & Directors General in Gothenburg, Sweden and other, the AACSB Deans Conference in San Francisco, CA. These meetings attracted respectively more than 300 and 600 business school leaders from all over the world and were a great place to assess what’s going on and, more importantly, what’s not.
At the EFMD meeting, I moderated a plenary where The Economist writer Adrian Wooldridge unleashed a set of criticisms at business schools—e.g., being too slow, focusing on the wrong things, being too distant from realities in their research, and preoccupied in publishing incremental insights in slow academic journals with only a modest impact. (See his summary in a Schumpeter column here). The Forbes writer Steve Denning followed up with an article saying that business schools take comfort in keeping that disruption slow. Richard Straub, President of the Global Peter Drucker Forum, commented that business schools suffer from the syndrome of our own success; we do not see the need to change what we believe is a winning model.
Two structural problems
Of the many imperfections we suffer from, critics zero in on two systemic problems to explain why we don’t adapt fast enough.
First, the notorious tenure system. A cornerstone of modern academia, the purpose of tenure was to guarantee that scholars could research anything without pressure from authorities inside or outside the walls of universities. Academic freedom is a worthy cause indeed, but in reality many deans know first-hand that tenure has evolved to make professors untouchable—and even able to block the very changes needed to fix the system. Adam Grant, tenured professor of management and psychology at the renowned Wharton School, says that the current tenure model makes some professors “choose to rest on their laurels, allowing their productivity to dwindle…develop tunnel vision about research, inflicting misery on students who suffer through their classes.”
At one extreme, tenure guarantees the free public debate. At the other extreme, it leads to a sense of entitlement among faculty that the institutions are theirs to run as they see fit regardless of what “outsiders” think, which reflects what Wooldridge called the “academic guild” problem. When the inmates are running the asylum, reduced institutional ability to quickly adjust to changing circumstances is the natural outcome.
Although rarely discussed in public, some discouraging cases of business school reform stopped short by tenured faculty claiming intrusions on their academic freedom are well known among business school deans (example). With the average tenure of deans moving towards just a few years, this is not very encouraging for prospective deans who seek to make a difference rather than more friends.
Second, research overpowers teaching. Few would argue that business schools should do away with research. However, many outside academia would like to see a closer connection between concepts, models, theories and the real world practices of business. Larry Zicklin, a Wall Street executive with teaching affiliations at the renowned Stern School and Wharton recently said in a Financial Times article that we’re “paying mediocre academics to conduct research that they should not be doing and writing articles and books that people never read."
The “relevance vs. rigor” debate in our field has been on for decades and many faculty members in our part of the world are profoundly engaged in practical problem in organizations. The real problem is that all incentives systems on all levels in the higher education system drive scholars to “publish or perish,” almost regardless of how many read the peer-reviewed articles.
The root of that problem goes back to the reports from the influential Ford and Carnegie Foundations in 1959. Their diagnosis of business schools at that time: too much engagement with cases, too little research; too much practice, too little theory. Over the last half century, business schools transformed themselves into the look and feel of “serious” science, which meant more research, less engagement; more theory, less practice. In the wake of the Enron scandal renowned management scholar Sumantra Goshal summarized the consequences: “Bad management theories are destroying good management practices.”
The prospect of research time is what attracts most people to academia. But the current system assumes that all scholars are and remain great researchers for the life of their careers, which is not the case. It is also assumes that all are great and keen educators, which is also untrue. The current model is also very expensive since tuition fees, external grants and/or the state must finance the tenured research time, regardless of its value to peers and practitioners. The consequence of this model is reduced institutional ability to adapt.
So Where Will Change Come From?
Universities are the second most long-lasting organizations on the planet, trailing only the Catholic Church. Yet, the acceleration of change is increasing to the extent where both the Catholic Church and universities have to begin adapting more profoundly and faster. The new Pope seems to have understood this. Why can’t business schools?
The tenure system and culture of prioritizing research over teaching are so interwoven with other facets of higher education, and regulated to remain so, that their transformation calls for changing national education systems and attitudes of the people involved on all levels. But I have difficulties seeing how a minister of education can win a motion in the parliament, or be re-elected by calling for the “creative destruction” of the university sector, especially business schools. Few dean colleagues would volunteer to champion radial reforms.
It is more likely that lawmakers try other solutions to change the sector. They might encourage mergers, like the Finish Alto University established in 2007, or deregulate the university sector to enable new cross-disciplinary private or public-private competitors like my own business school in Sweden from 1994, JIBS, or the recent SUTD in Singapore. Like in the habit in Denmark, most governments will probably continue to initiate yet another critical review of universities and send new ministers to be reinvigorated in Silicon Valley, with modest impact.
The research vs. teaching dilemma is also a complex one and without quick fixes. Despite the many strong voices calling for reform don’t expect more than incremental changes coming from within academia. Adam Grant proposed that we complement the current research-only tenure with a teaching-only tenure track and perhaps a combined track. He is convinced that we would see net gains in both research and teaching with this system. Professors could specialize at what they are most passionate about. Such a system could also deal with the typical post-tenure decline in research productivity and higher costs. We would also avoid what Steve Denning said is his blog post in Forbes: “Those who can’t teach, do research.”
Sounds great? The practical problem, Grant recognizes, is that we would need to have clear criteria for evaluating research productivity and teaching impact, not just student ratings. For such a system to work career advancement and compensation also need to better balance education and research abilities. In most countries, the entire higher education system would need to change.
But, external chocks will penetrate even the most protected systems if they are explosive enough. High quality teaching MOOCs may fulfill this criterion. The AACSB event prominently featured two very different players in the MOOCs field, Coursera co-founder, Daphny Koller and Ben Nelson, founder of Minerva, who both argued that MOOCs prove that teaching will re-take more prominence in business education. A competitive Google University (already part of one MOOCs provider) could really light a fire under incumbents.
A Special Kind of Leadership
The idea that the solution for business schools is to become "more like a business" is well intentioned, but wrong. Deans are not like CEOs of companies and university presidents do not chair corporations and boss around subsidiaries. A president of a major European university told me that, at best, his many faculty members regard his formal presidential decisions as “interesting contributions to their own dialogue,” which illustrates the leadership challenge at hand.
Because of the tenure system we cannot easily fire people and in a collegial culture like ours, it is not easy to use money to buy talent. Individual leaders in academia simply don’t have enough structural power to make important decisions by themselves.
But, we can influence our schools’ strategy and the organization, but not in a typical company way. Author Jim Collins recognized that leadership in the social sector like academic relies upon persuasion, inclusion and exclusion, and shared interests to create the conditions for the right decisions to happen. Such leadership is very demanding and calls for much patience. The legitimacy to lead in academia doesn’t come with the president or dean title, but from scholarship respected by peers typically evidenced by a professorship. If deans want to do more than administrate the status quo, they also need profound people, facilitation and communications skills.It is possible to make significant transformation over only a few years.
Over the last two years we have renewed the strategy of my business school, JIBS, and the governance model and leadership team. We have also dissolved all departments since they neither reflect our strategy nor help deliver on our main priorities. Stunned dean colleagues approached me after I mentioned this during the EFMD and AACB meetings—an indication of the level of incredulity that profound change can actually get done (see article). Such strategic and organizational changes are a real dilemma for business schools, but they must be squarely faced. We can’t make change happen while secretly wishing for everything to remain the same.
If there is to be a continued bright future for business schools, we need to strengthen the conversation about our challenges, even the structural and systemic ones, and keep our dialogues going. Meetings like the EFMD and AACSB are vital for a healthy debate that gradually influence the hearts, minds and souls of deans, which is an important step on a longer transformative journey—and I eagerly await the next ones.