Academic view: A new philosophy of leadership
Business schools need to produce leaders for the many, not the few, says Ken Starkey, a professor at Nottingham University Business School
WHAT are the three hardest words for a business leader to speak? Probably “I don’t know”. Business leaders are encouraged to exhibit confidence, competence and omniscience. But this leads to only two possible outcomes. They can fake it: pretend that they are right because they know that the admission of uncertainty and weakness is a career killer. Or they can believe their own hype, convinced that they are right and know better than everybody else.
This is where we now stand. A model has evolved whereby the leaders of business and finance, abetted by an elite group of economists, have convinced themselves that only they know the way the world should work.
However, we are at a tipping point. Nitin Nohria, the new dean of Harvard Business School, argues that we need leaders who demonstrate moral humility. I believe that we need an approach to leadership in which the starting point is our lack of knowledge, a frank admission that we do not know very much about how to build a sustainable system for business and society.
In this humility-driven vision of leadership, business schools need to shift their centre of gravity away from economics, finance and dreams of individual fortune. We need to teach future leaders to reflect and critique—that there are alternatives to theories that they accept, without question, because they speak to their self-interest.
To do this, business schools need to challenge their own orthodoxy—a crude Darwinian view of business and society rooted in the survival of the fittest. They need to focus on the social consequences of their actions and accept responsibility for the business excesses of recent years. What is required is a narrative of common interest to combat the mantra of selfishness; one that appeals to the sense that leadership is for all not for the few.
The main challenge is how to reflect this in the MBA. Two strategies are possible. The first is to keep the MBA the foremost qualification in management, but to revise it. Many schools are trying to do this with an explosion of courses in, for example, responsibility, sustainability and social entrepreneurship. The more inventive are using philosophy and the arts to critique dominant business mindsets. Jim March’s pioneering use of literature to teach leadership at Stanford is an example of this. The increasing interest in the psychology of personal development is another.
However, these changes are just tinkering at the edges of the curriculum. Meanwhile responsible capitalism burns. The core of an MBA programme is still resolutely grounded in finance and supposedly rational analysis. Business schools still market themselves based upon media rankings, including The Economist’s, in which individual salary is the main metric. Their challenge should be to create a business system—in particular a financial system—responsive to the greater, rather than the minority, good.
Studying the classics
So a second, more radical strategy could be to create a new kind of Master’s education that melds an understanding of business with a broader concept of education. Business schools could become more like the agora of ancient Athens, a place where commerce had its place alongside the academy, where philosophers discussed the meaning of the good life and how best to achieve it; a place of dialogue where citizens collectively addressed the limits of their knowledge. For this, business schools might recruit graduates from other disciplines, such the arts, humanities and the sciences, and create innovative courses to help future leaders imagine products and services which fulfil a more social need.
This will not be easy. It requires a difficult balancing act between the intellectual, emotional and spiritual. But if we are to create a new business model out of the chaos of a crisis to which business schools contributed, we will need to take a long hard look at how leadership is taught in our schools. Business as usual is no longer an option.
Ken Starkey: Professor of management and organisational learning at Nottingham University Business School
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It is refreshing to have these thoughts outed! From my perspective as a professional in the field of international development, nothing is more lacking than backgrounds and abilities to think in holistic terms and to thus recognise that a propensity to acknowledge other disciplines and ways of thinking contribute to a more cogent understanding of issues and their potential solutions. Kudos to NUBS!
True, but I think that it should not be called rationalism, it should be called the believe in determinism.
Rationalism (based on Karl Popper) is based on objective reasoning and a high sophisticated trial and error approach.
We do need to question determinism, the big mistake in economics was to try to emulate the impressive accuracy of engineers and physics. This approach is doomed to fail because it ignores that economics is more about social science.
I think to understand in depth it is necessary to dig very deep into the evolutionary history of business and economics.
I am sure that by analyzing the problem in depth the result would lead to an all new business approach.
But it is true that the MBA and other studies replicate a false and invalidated business philosophie.
I even thought about writing a book about that: Newton's curse or how determinism wracks business and society
Catchy, isn't?:-)
I always recommended to my mech. eng. students that they get a thorough experience at as many industry levels as possible and then go for an MBA or M.Econ.to understand what organization and money really are all about. They would be confirmed skeptics.
I would never have employed a B.graduate in economics or business administration. I suspect that these programmes would be better closed; beware the arrogance of ignorance!
My later experience as a U.N. agency staff member reflects the comments of HAUgemMgyG; I had the most splendid and satisfactory project results with retired - or redundant - top management personnel who worked up with a Higher National Certificate. They knew their world from the bottom up.
We seem to hear a lot about leadership these days and little about management. Has 'management' disappeared from the lexicon? Or is it just that 'leadership' sells more education and training?
Perhaps the Economist can moderate a healthy debate on this.
Here are the best definitions I have come across recently, 'Leaders look outwards, managers look inwards'.
Good leaders are not necessarily good managers and vice versa. Good managers are worth their weight in gold (and bonuses?), as are good leaders.
Perhaps then the MBA from Macquarie University in Sydney Australia (MGSM) was revolutionary as it has been teaching Critical thinking and Philosophy under Professor Robert Spillane as a core subject for many years. This taught me that reasoning and argument are as important as Finance and other business studies. My experience has shown me that many people start from a pre determined view and then use finance and marketing to support their arguments rather than from an open view to arrive at the best course of action. Inevitably of course the pre determined view is favourable to the proponent.
To many, this is merely a welcome restatement of the obvious. There are those of us to whom this outlook has been plainly apparent for decades, but until recently, has been a view suffering from ever declining acceptance. Perhaps the recent economic and financial debacles, largely and unapolagetically engineered by MBA-holding operatives, have elucidated the situation. Still, MBA programs have continued rolling out the same old models: single-minded ("dedicated to maximum management compensation"), selfish ("whatever it takes, no matter who's hurt"), and self-aggrandizing ("those from other disciplines are clueless and inferior"). Perhaps a gross generalization and a bit unfair to some, this is the impression of MBA's held by myself and many of my acquaintances managing Silicon Valley business concerns. Make no mistake, MBA's have a lot to offer, just not nearly so much as they think. Their views and approaches are too narrow; and most importantly, they need a larger vision of the world. In that respect I most certainly agree with Professor Starkey's observations.
In order to be effective, a manager or leader must know his/herself and mission. Newly minted Psych degree holders as part of our HR orientation were exposed to "...it is always about "MOM", it is always about Me Or Mission. An effective developmental curriculum would balance quant, qual, and moi.
Fully agree with Mr Barry Faith. In fact, “Good leaders are not necessarily good managers and vice versa.” If we come closer to the definition of leadership and management – you will find out that there are too many definitions, which have been introduced since Socratus times. On a global scale in the changing environment business education tends more and more speak about entrepreneurial leadership, i.e. leaders who may change the world and act either in a commercial business, social enterprise or be agent of political changes. We in SKOLKOVO educate mainly entrepreneurial leaders and these are whom we are targeting on when talking about the desired candidate profile onto MBA\ EMBA programmes.
If you see the point and vision in the modern perception of leadership and entrepreneurial spirit – you are more than welcome to share!
I'm the Chief Executive of a multi-disciplinary, long-term project, The National Forest, up the road from Prof Starkey in the English Midlands. I have to make the business case to businesses about investing in our Forest but am often heartened at how they 'get' the wider social benefits. What is less heartening is certainly the narrowness of most MBAs and then the expense of one-off, touchy feely quasi Buddhist alternative management training.
I've just cultivated heart and mind as best I can and so far it's been creative, fun and rewarding.
Self-Preservation
It all goes back to self-preservation, and survival of the fittest. Leaders of corporations commonly have 5, 6, 7 or 8 levels below them (or more). If you have strong confidence, and a disciplined 2nd and 3rd levels of employees, you can drive your mission and vision. Though it may be out of touch with employees at the lower levels, it becomes a self fulfilling prophecy of greatness, accomplishment and reward.
Levels 2 and 3 want self-preservation as well - especially in these tough economic times. Thus, when the boss says we are going to do "XYZ," his/her direct reports at Level 2 agree, and turn around and pass along "XYZ" to Level 3. Those who execute to the bosses satisfaction, get rewarded and stick around a little longer.
When bad news comes-up from the lower Levels, it gets watered-down. The pain that is experienced at Level 8 is a lot more than reported at Level 3. Thus, the concept of "killing the messenger" is still active in modern times, and bad news is avoided.
Sure, the executives have employee surveys for the entire company at all levels, but the timeliness of reaction is usually 6 - 12 months. Leadership is wanting to see a trend rather than react to spike, which is what they are taught in Grad School.
I propose a new way of managing. A leader should have all layers represented on his/her staff. Not in a figure-head role, but in a 1x1, face-to-face, role on a weekly, if not, daily basis.
If the leader really wants to know what is happening in the company, he/she must go to the source, and bypass (eliminate) the "Good News Fairies."