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B-School education in North America,
represented typically by the MBA degree,
has been examined a few times over the past 50 years and again over the past decade.
Some writers believed that business education was
not doing a good job in developing managers and leaders, and more particularly, ethical
managers and leaders (Mintzberg, 2004; O'Toole &
Bennis, 2005). The current economic crisis has
added some new dimensions and perhaps even some impetus to examine B-School education
more seriously.
Consider the following recent examples: Instances of financial fraud and corruption
have occurred worldwide and captured the
mainstream media (e.g., Enron-US, WorldCom-US, HealthSouth-US, Parmalat-Italy, Harris Scarfe
and HIH-Australia, SK Global-Korea, YGX-China, Livedoor Co.-Japan, Royal
Ahold-Netherlands, Vivendi-France, Satyam-India). Some
were perpetrated by individuals with B-School education (MBAs), but the vast majority of
MBAs are honest; and individuals without business education also have been found guilty
of misconduct. CEO salaries have skyrocketed with huge salary increases and bonuses paid
to individuals at the helm of failing companies. Senior executives and their corporate
boards seemed unable to implement and practice the sound human resource management
strategies they encountered in their business programs
(e.g., motivation theories, effective rewards,
equity). CEOs, already earning large salaries,
sometimes flew to meetings on their corporate jets, rather
than take cheaper commercial flights (e.g., CEOs of
the big three US automakers) while seeking
employee wage concessions and closing plants and
putting employees out of work. These CEOs seemed insensitive to the plight of the average residents
of Main Street (not Wall Street).
Too many CEOs were arrogant, exhibited hubris, and an inflated sense of entitlement.
These "Masters and Mistresses of the Universe"
(Wolfe, 1987) saw their organizations as their own
"piggy banks". Examples include the purchase of a
$6,000 shower curtain (Dennis Kozlowski, Tyco,
currently serving a prison sentence), an $8,000 purchase
of Lord Beaverbrook memorabilia by Conrad Black (currently in jail for fraud), commode as part
of luxury yachts (Allen Stafford, currently in jail for
fraud), and several luxury homes (Bernard Madoff convicted of fraud and awaiting
sentencing). About 50 to 75% of managers and
senior executives are falling short in the performance
of their jobs (Hogan & Hogan, 2001; Burke,
2004). Studies have shown that the biggest source
of stress for most employees is their boss. Henry Mintzberg (2004) reports a longitudinal study
he conducted on 19 Harvard MBA graduates who were touted as stars in their early career. Later
data indicated that about ten had done poorly in
their managerial careers, four performed at a
mediocre level, while five were found to be performing at
a high level.
There are thousands of books and tens of thousands of research articles on managers
and leaders. Billions of dollars are spent on developing managers and leaders both
in business schools and in-house organizational initiatives. Yet, experts believe that we have
a shortage of leaders, most organizations do not
see enough effective leaders in their pipeline
(Fulmer & Conger, 2004), and organizations are facing
a war for talent (Michaels, Handfield-Jones & Axelrod, 2001).
Much of the writing on managers and leaders identifies what makes
managers successful in advancing their career
(upward mobility) instead of what makes a manager effective in achieving challenging objectives
using the human and material resources at their disposal (Hogan,
1999). |
