There have always been dreams of how one can exercise leadership to make a difference in the world. And even though that’s our stated mission, “to educate leaders who make a difference in the world,” I don’t think it’s just what people write on their application forms to get in. There’s a very large number of people who do have dreams about how, through business, they can make a difference in the world. And I think that’s been an important part of Harvard Business School and the students whom we’ve attracted throughout my time here at the school.
I think what has changed over time is different fields have risen and fallen in terms of importance. When I first came to the school, which was in 1988, consulting and investment banking were both still hot. By the late nineties, entrepreneurship had become very hot, particularly during the dot-com boom. At various points in the middle, real estate seems to be something that becomes hot and kinds of falls off.
So in some ways, the students are always searching for what seems to be the hot sector of the economy, and they pursue that. What’s hot changes all the time, so there’s a dynamism in what our students go into. If you look further back in the first decades of the school, we were having people who were going into railroads, and then we had people going into consumer packaged goods.
You know, everybody worries. “Will the school only produce people who are in consulting and finance?” But we forget that the world always changes and as the opportunity structure changes, our students go to different things. So just in the last five or seven years, we’ve begun to see clean tech as one of the fastest-growing paths in terms of where people will go from HBS. Health care has also become one of the fastest new sectors. Social enterprise—which was not even a category when I first came to HBS—is extremely popular. So what I think is striking is the constant dynamism in how people are looking for new things, and I expect that dynamism will continue. You pick people who are ambitious, who have aspirations—a combination of wanting to do well for themselves but also do well for society. And as that intersection evolves, the desires of our students evolve as well.
Part of that dynamism is the set of values that people bring to leadership, and those values have changed throughout the years—most acutely in the past two to three years when some have called into question the very legitimacy of business leaders in society. How have you seen people’s or MBAs’ attitudes toward leadership change over the years? How might that change moving forward?
I think there have been moments in this period where the lure of short-term gains was so high that our students, like many other people in business, were captivated, then captured by it. During the dot-com boom you could create a company and in 18 months, you became a multi-millionaire, multi-billionaire—if there’s money to be made, you don’t want to be the fool who’s sitting on the sideline while others are doing it, right?
What has been true in business through millennia is that any place in which you can make money very quickly isn’t long-lived. And I think that’s a little bit of a trap, the sort of short-term trap, which occasionally business leaders fall into and something that we’ve now lived through in recent times as well. It’s as if a few people benefited from the positive externalities and many, many people got left paying for the negative externalities of this most recent round of short-term value creation. I think that’s what caused a greater anxiety about the vulture of business in recent times.