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Business Schools: Instruction or Indoctrination?

The Economist of 29 October included a profile of Gary Gensler, chairman of the US Securities and Exchange Commission (SEC). According to the piece, Mr. Gensler is not only well qualified in finance and regulation, he “even” understands crypto. In 2018, Mr. Gensler taught a class on blockchains at the Massachusetts Institute of Technology’s business school. The full series of 23 lectures is available on YouTube[i].

The profile states:

In his first lecture he [Gensler] quizzed students on what they wanted from the class. When reviewing the results the next week, he revealed that five people had admitted their aim was to make money: “And I applaud those who said that because: Own it. You’re in a business school. Why not?” he grinned.

That perception of what business schools are about would have been music to the ears of Professor Martin Parker of the University of Bristol who authored a Long Read piece in The Guardian in April 2018 under the arresting title:

Why we should bulldoze the business school[ii]

The piece crossed my radar when it was recently rebroadcast as a podcast.

Mr. Parker had been teaching at various business schools since 1995.

He wastes no time setting out his stall, firing off this opening salvo.

Visit the average university campus and it is likely that the newest and most ostentatious building will be occupied by the business school. The business school has the best building because it makes the biggest profits (or, euphemistically, “contribution” or “surplus”) — as you might expect, from a form of knowledge that teaches people how to make profits.

Business schools have huge influence, yet they are also widely regarded to be intellectually fraudulent places, fostering a culture of short-termism and greed.

Post-graduate business courses are routinely among the most expensive offerings of universities. The bargain only works if the students can be trained up to make a decent return fast on their substantial investment.

Mr. Parker’s thesis can be summarised as follows.

First, business schools don’t just teach people how to make profits, a mission of dubious value in itself. These schools extol the virtue of making profits with little qualification or distinction about how those profits are made. Foul means are only marginally less good than fair ones, rather than being altogether bad. Greed is good and short-termism rules.

Second, business schools teach only one form of organisation and elevate this to the status of being the only possible sustainable form.

…the virtues of capitalist market managerialism are told and sold as if there were no other ways of seeing the world…

The message that management research and teaching often provides is that capitalism is inevitable, and that the financial and legal techniques for running capitalism are a form of science.

Third, as a consequence of the second point, the analytic focus is exclusively on the “numbers”, to the detriment of everything else.

If we teach that there is nothing else below the bottom line, then ideas about sustainability, diversity, responsibility and so on become mere decoration.

Fourth, following from the third, ethical considerations are also an incidental add-on consideration, not essential to the project. Of course, business schools increasingly include modules on such worthy subjects as “corporate social responsibility”, but these are tangential, “tick the box” stuff, cover for the “rape and pillage” that is the real agenda rather than to instill a genuine sense of social responsibility in students.

Fifth, unsurprisingly, the people who emerge from these conveyor belts are not very nice. They are masters or mistresses of the universe, but not in a good way.

One US survey compared MBA students to people who were imprisoned in low-security prisons and found that the latter were more ethical. Another suggested that the likelihood of committing some form of corporate crime increased if the individual concerned had experience of graduate business education, or military service.

Having an MBA might not make a student greedy, impatient or unethical, but both the B-school’s explicit and hidden curriculums do teach lessons.

Finally, following from the last, their impact on the world is not entirely positive.

The sort of world that is being produced by the market managerialism that the business school sells is not a pleasant one. It’s a sort of utopia for the wealthy and powerful, a group that the students are encouraged to imagine themselves joining, but such privilege is bought at a very high cost, resulting in environmental catastrophe, resource wars and forced migration, inequality within and between countries, the encouragement of hyper-consumption as well as persistently anti-democratic practices at work.

Mr. Parker’s conclusion is foreshadowed in the title to his piece.

For us to assume that global capitalism can continue as it is means to assume a path to destruction. So if we are going to move away from business as usual, then we also need to radically reimagine the business school as usual. And this means more than pious murmurings about corporate social responsibility. It means doing away with what we have, and starting again.

Before reflecting on Mr. Parker’s views, I must declare my own priors. Three decades ago, after ten years’ service in Ireland’s Department of Foreign Affairs, I switched to the world of business, joining an aircraft leasing company. That might seem like a larger leap than it actually was. Both domains are about building and maintaining relationships, negotiating possible deals, getting some of those potential deals settled, executed and their after-effects managed, all within a reasonably orderly process framework.

At my first annual performance review in my new world, I mused that while I had learnt a lot “on the job”, about how businesses work, it might be worthwhile to pursue an MBA to accelerate the learning process and establish greater depth and structure around my business knowledge. The truth was that I was hoping to bank credit for “airing” the idea without having to follow through to any action. But my boss was always several moves ahead of me in the chess game. He responded enthusiastically. “That’s a very good idea. You should sign up next September and the company will pay for it.” Checkmate.

That was how I came to do a two-year part time MBA at the University of Limerick (UL) which I finished in 1993. Beyond the mid-west of Ireland where we know it to rank alongside the very best, it may be whispered that UL is not quite on a par with the big league business schools of the US, but my time there certainly sharpened my knowledge and skills appreciably, if not immeasurably.

Back to Mr. Parker.

A frustrating feature of his article is that he writes about business schools in general rather than about any specific school or schools. So, when he cites “scripture” in support of his arguments, you have to take his word that the “scripture” he cites is representative of all relevant scripture rather than, as with the devil, selectively cited to fit his argument. And it is fair to say that the scripture he cites is often vague rather than granular — of the “Many people believe…” or “A survey has shown…” variety. His article is more polemic than analysis. There is nothing inherently wrong with that, but arguments are always more convincing if it looks like the evidence is assembled neutrally first and then the conclusion derived rather than things being done the other way around.

And there is something a bit eyebrow-raising about Mr. Parker’s contention that his convictions have been solidified by his 20 years’ experience of teaching in business schools. He suggests that the steady stream of criticisms of business schools from within the institutions themselves indicates the gravity of the problem. But the criticism has been neutralised by being institutionalised.

Careers are made by wailing loudly in books and papers about the problems with business schools…

…Even titles such as Against Management, Fucking Management and The Greedy Bastard’s Guide to Business appear not to cause any particular difficulties for their authors. I know this, because I wrote the first two.

As an “old hand” in business schools, albeit on the staff rather than in the audience, Mr. Parker might say that this kind of “trying to have one’s cake and eat it” stuff confirms only the moral vacuum in the institutions rather than any moral shortcomings in himself. He seems to see nothing untoward about taking the university’s shilling and raising two fingers to it. But, it looks to me that he is either oblivious to the moral ambiguity of his position or casually self-serving.

I was especially struck by his claim that business schools are as much about ideological indoctrination as they are about education or instruction. I cannot recall any such cheerleading for capitalism during my time at UL but then the instruments of ideological absorption may have been so fiendishly subtle that they passed me by. Certainly, we had no overt equivalents of Orwell’s “Two minute hates”, no ritual collective chants of “Greed is good” or “To the victor the spoils, to the vanquished the dole”.

Nor can I recall any encouragement to believe that capitalism was the only possible legitimate form of social organisation or even encouragement to believe that capitalism was “an inherently good thing”.

But, it seems obviously sensible that schools should concentrate on inducting students in the seams of activity through which goods and services actually are produced and delivered to customers in the world as it actually is, rather than engaging in a visionary group hug discussion of alternative forms of social and commercial organisation that don’t actually exist — at least on any widespread basis.

Mr. Parker neglects entirely the “nuts and bolts” learning activities in business schools. For example, in the various modules at UL: financial management, accounting, taxation, etc., teachers were at pains to stress that the objective was NOT to turn us into the equivalent of people who are specifically professionally qualified in those disciplines. Rather, it was to give us enough of a grounding to have a reasonable understanding of what such professionals might be trying to communicate to us and to be able to ask intelligent questions. Humble though it may be, being equipped with a bullshit detector or a capacity to hold these professionals more fully accountable is a useful form of practical education.

I am not sure that Mr. Parker’s suggestion holds up that education in business ought to be grounded in a broader tour through all the issues and problems facing society today and into the future. That is not to say that business people have an exemption from their moral obligations as human beings to consider such things. But, it is the equivalent of suggesting that workers on car production lines should spend part of their working week discussing solemnly whether cars should be allowed on the roads at all because of the potential adverse environmental and social consequences.

Finally, we can talk authoritatively only to our own experience. But mine runs contrary to Mr. Parker’s narrow view of the motivations that prompt people to go to business school. No doubt there are indeed some people who see these courses as a gateway to more money and to faster personal advancement, maybe even some who see “business” solely as a short term project with the object of setting oneself up handsomely for life as quickly and easily as possible, hunting down and squirreling away a decent collection of golden eggs.

But my experience is that business people, whether entrepreneurs and creators of their own business(es) or employees of pre-existing ones are well capable of and generally do flex the short and the long term and, more important, their private interest and the public interest. Of course, they want to develop themselves, advance their careers and have more money rather than less. But they are also concerned about the social implications and the sustainability of what they do, about their reputation in society and the legacy they leave behind them. They pursue “value” as something broader than shareholder value in the narrow sense of their institution’s commercial valuation. Those I have encountered are much more concerned about nurturing worthwhile as well as profitable organisations than walking away with a barrowload of cash, tending to the golden goose rather than walking off with only the eggs.

Businesses run along the lines of Scrooge’s counting house rarely endure. But the same applies to businesses run predominantly as philanthropic organisations. There is a wide navigable channel between these poles. The challenge of business is to achieve a sustainable balance between public and private interest, not to pursue one entirely at the expense of the other.





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Daire O'Criodain

Former diplomat and aviation finance executive, active now mainly in not-for-profit sector. Living in rural Clare. Weekly posts on Wednesdays.