“The customer is always right,” they say. If business schools consider employers to be their #1 customers, then they recently got a sobering message: “We’re thinking of re-opening your contract. Your product isn’t very useful anymore.”
In a recent study, Hult Labs, an arm of Hult International Business School, interviewed 90 C-suite executives, managers, and academics on how business schools could improve. And boy did they get some feedback! In fact 44% of respondents had negative view of business schools…and another 23% shared a mixed or neutral impression.
In other words, two-thirds were either unhappy, apathetic, or torn when it comes to the value of a business school education!
The sample, where 60% hailed from North America and 17% from Asia, included respondents from sectors like finance, technology, consulting, services, consumer goods, and education. Originally, Hult Labs intended to interview 200 executives. After repeatedly hearing the same responses, they decided to scale back the study, according to Hult President Stephen Hodges.
Based on the surveys, Hult Labs broke the sample’s discomfort with business school education into three themes:
1) Doesn’t adequately measure if their students are actually learning new, relevant skills and behaviors.
2) Doesn’t place enough emphasis on building ten critical skills and abilities.
3. Continues to overemphasize theory and should instead concentrate more on simulating real-world experiences.
Here are, specifically, some of the complaints:
- “I’m amazed at the lack of sophistication that so many MBAs show about globalization and dealing in an increasingly global economy…They have no concept about the changes that are underway with a billion people here or there consuming and investing in ways that they didn’t in the past. They may understand the numbers, but they sure don’t have an anthropological lens on these issues.” – Anonymous CEO
- “Business is more of a group or team endeavor than an individual one. I know that some schools are trying to do something about teaching MBAs how to work in teams, but I don’t think they are really doing it, or at least they’re not doing it very well. I just don’t find very much about team building or team participation in the general management theory. I figure that academically inclined professors aren’t teaching it.” – Anonymous CEO
- “Students look at data and don’t ask, ‘What’s it telling me; what does it really mean?’ They know the mechanics but not what it really means, or the context.” – Kevin Wheeler, Founder and CEO, Global Learning Resources
- “There are shortcomings of case studies. They don’t take into account the way the world really works. The information is so clearly laid out that it doesn’t take into account the ambiguities of the world. It leads students to a ‘correct’ decision. In the real business world, you see lots of ambiguities and uncertainties.” – Li Chong, Senior Manager, World Economic Forum
- “The knowledge being [taught] in [most] business schools is so out of date. I’m really surprised by this actually. My people are not getting the ideas that are on the cutting edge of theory. They are mostly getting very old information from old articles and old cases.” – Anonymous CEO
- “Many of the elite students who go to MBA programs have very high IQs, but that is not what is needed anymore. It is not IQ; it is creative ability that is important. To instill creative capability in people, you also need to get them to be sensitive to the present situation and then to come up with what a better, new future might be. It is very important you come up with a way to teach that kind of sense.” – Tetsuro Higashi, Chairman of the Board, Tokyo Electron
- “We need MBA graduates to be able to identify opportunities and structure solutions. We need real entrepreneurship. Very few people can spot opportunities. They can do slides and business planning and analysis, but they don’t engage enough in the real world with real issues and real opportunities.” – Yasar Jarrar, PhD. Partner, Bain & Company
Similarly, executives felt business schools are using the wrong metrics – grades – to measure student mastery. In fact, the Wall Street Journal reports that “just 12% of those interviewed said M.B.A. grades actually matter in hiring.” Instead, respondents were emphasizing people skills and real world experience over theory and technical proficiency. In particular, they valued these skills the most:
- Self-Awareness (62%)
- Integrity (60%)
- Cross-Cultural Competency (57%)
- Team Skills (49%)
- Critical Thinking (48%)
- Communication (48%)
- Comfort with Ambiguity and Uncertainty (41%)
- Creativity (27%)
- Execution (21%)
- Sales (19%)
While these leaders valued critical thinking, they were more interested in hiring ‘doers,’ who weren’t paralyzed by options and ambiguity. Instead, they wanted employees who could balance an open-minded creativity with a can-do mentality. In other words, they sought talent who could spot opportunities, jump into the fray without fear, and turn a vision into reality. As Muna Al Gurg, director of retail at the Al Gurg Group stressed, “I need people who can change and improve things, not people who can sit around and apply models all day long.”
There is a joke among entrepreneurs that you can valuate a company by adding $500,000 for every engineer and subtracting $250,000 for every MBA. While that observation may be harsh, it reinforces the same point of this survey: Many executives aren’t overly enthused about the caliber of employees being churned out at business schools. Eventually, schools may need to look at companies as their de facto board. And these board members are already signaling a message to management:
Your customers aren’t happy. And perception is reality. So shape up or ship out…because the customer is always right.
What are your thoughts? Do business schools focus too heavily on theory? Should they place greater emphasis on soft skills and global immersion? And what steps would you take to set business schools more in step with business? We’d love to hear from you!
Source: Wall Street Journal