I believe business schools and what they teach have reached a point where it is almost impossible to run a business successfully on their terms.
This is mostly spit balling. It offers little in the way of rigorous data to back up its contentions, which I know is a weakness. But I am not an actual journalist or academic, so I do not have the resources required to really prove my contention. But the qualitative data certainly seems suggestive. To wit:
What do all these decisions have in common? They are all driven by the desire to goose immediate profits over sustained business success, and they are all made by people who are businesspeople not creators (Zaslav is a lawyer by training, but the point holds. He is not a TV or movie producer in any meaningful sense.). And these problems are not limited to just those companies. Apple, led by a man with an MBA, for example, spends more on stock buy backs than it does on research and development, as its recent product history would probably indicate. It feels, honestly, as if the world would be better if we closed all the business schools.
This is not a new thought, of course. Even people who teach at business schools recognize that they tend to teach “… students that heroic transformational leaders are the answer to every problem, or that the purpose of learning about taxation laws is to evade taxation, or that creating new desires is the purpose of marketing. In every case, the business school acts as an apologist, selling ideology as if it were science.” Or that business schools seem to produce more criminals than other disciplines.
Now, the outputs of business schools are not the only issues, of course. Nothing in a system as complex as the economy ever are. The growth of monopolies, the reluctance to prosecute white collar crime, the skewed incentives of Wall Street and the tax structure: all contribute. But what value does business school education actually provide to these companies? Boeing, when it was run by engineers, created the world’s best planes. Now they fall out of the sky far too often. Apple used to innovate, now it stagnates. The solutions tend to be the same: financial engineering in terms of layoffs and stock buybacks and focusing on old, familiar successes in the hopes that people will continue to flock to what they liked yesterday. How is that good for a sustained business?
Why, for example, aren’t movie and game studios trying to pivot to lots of smaller, less costly releases instead of putting all their eggs in one basket? It seems to be working for smaller game studios, after all. Could it be that these places are run by people who don’t actually understand how to build things and thus have no idea what to do if their bag of financial tricks doesn’t work?
It really does seem as if companies would be better off with people who understand the products, the process it takes to make the things they are selling, in charge and let the accountants handle the, well, accounting. People who actually like making the thing they are selling, like providing the service they are advertising — those people are the ones who will have ideas when things don’t go as planned. Those people are the ones who are more likely to properly assess how to change their products and services to better meet the market. Those people, in other words, are the ones most likely to be able to do things rather than just destroy things.
And this is not just my personal opinion. As of 2006, companies led by MBAs did worse than companies led by people from other backgrounds.
There are a lot of things we need to do to rebuild our economy into one that serves our society. But maybe, just maybe, first we should close all the business schools.