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Updated on: 27 Mar 2009, 11:07
Originally posted by AlexMBAApply on 27 Mar 2009, 10:54.
Last edited by AlexMBAApply on 27 Mar 2009, 11:07, edited 3 times in total.
Last edited by AlexMBAApply on 27 Mar 2009, 11:07, edited 3 times in total.
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The underlying causes for the mess we're in run far deeper than what business schools are teaching.
In fact, it's easy to target MBAs, executives, Wall Street, etc. but the thing is we are all to blame. It was the excesses of the prior era that we lived in, and that so many constituents bought into. I'll probably get off topic a bit here, but my main point in writing this is to explain why I don't think business schools alone should take any more blame than any other institution for the excesses of the last era.
The "every man for himself" mentality began in the Gold Rush of the late 19th century, and culminated in the excesses of the roaring 1920s. When that crashed and led to the disillusionment of unfettered capitalism and the "robber barons" (the bankers and the big families of that era - Carnegie, Morgan, Rockefeller, etc.), it ushered in a new era of collective responsibility. FDR's administration during the Great Depression was predicated on that -- that individual self-interest (capitalism) had to be balanced with collective responsibility (New Deal). Public/civic responsibility and big government played a big role from the 1930s to 1980. It's no accident that The Marshall Plan, The United Nations, The World Bank, NASA, etc. were byproducts from this time period.
Where this "balance between collective responsibility and individual self-interest" crumbled started with Watergate and ended with the Carter administration. While the postwar era up until Watergate saw FDR/Kennedy liberalism triumph (that government could do good and that we as a country could collectively do good - the whole "ask not what your country can do for you but what you can do for your country" mentality), those values crumbled starting with a misguided war (Vietnam), and climaxed with Watergate. It was a time of disillusionment with public institutions and by extension the idea that "we're all in this together." Around this time there was also an oil crisis that the gov't couldn't do anything about -- and the erosion of the idea of civic responsibility culminated in the election of Reagan and Thatcher.
1980 began a new era. The NIMBY (Not In My BackYard) economy or the "f*ck you" economy. Reagan best summed up the public sentiment and the era that he would usher in for the next 20+ years -- that government (and by extension the idea of collective responsibility) wasn't the solution, but part of the problem. It was a cynical knee jerk reaction to the erosion and scandal of the 1970s -- that the only way for a country (whether it's business, politics, community, etc.) is every man for himself. Screw public institutions. Screw collective responsibility. Let me mind my own business and you mind yours.
It was during these next 20 years (and Clinton was really more similar to Reagan than the classic liberals a la FDR or Kennedy) that was unlike the post-war era. Self-interest resulted in extraordinary growth and wealth creation -- and while the "trickle down" theory certainly did lift many boats, it was nevertheless skewed towards a minority -- but hey, when even the little guy was doing okay, no one was complaining about the NIMBY mentality. However, it was also during this time that we willingly (as voters and taxpayers) neglected public institutions in favor of self-interest. We want lower taxes, more individual wealth, higher stock prices, etc. but health care, education, and regulation would be victims we're willing to sacrifice for it.
If Watergate heralded the beginning of the end to post-war liberalism, 9/11 heralded the beginning of the end to the NIMBY era - and the nail in the coffin is our current financial crisis.
So it's easy to blame just one institution (business schools) for our ills, but the reality is it's a byproduct of the era we lived in from the 1980s onwards, which was a response to the failures of liberalism in the 1970s. Same with Wall Street, business executives, Republicans, Bush, etc -- we can blame all these people, but the fact is these institutions and people were byproducts of the era we lived in -- the underlying assumptions that we all lived by to some extent either religiously or tacitly by "playing along". We lived in a "greed is good" era and have only realized that "greed" isn't enough. With problems such as terrorism/extremism, climate change, health care, education, and the financial crisis, the sentiment now is that we can't just care about our own lot - that we are all in this together and that it will take a COLLECTIVE effort to solve our most pressing problems - both at the global as well as at the community level. That is where the public sentiment is right now, and is why we elected someone in office who seems driven to restore that balance between individual self-interest and collective responsibility. It wasn't "YES I CAN" but "YES WE CAN" that voters and the media really responded to.
The public outrage today over so many of the failed private and business institutions of the last 10 years is really a mirror image of the public outrage in the 1980s over the public and gov't institutions of the 1970s.
Just like we blamed public institutions for our ills 20+ years ago, we are now blaming free markets for our ills now. There's good in both, so let's hope that we don't throw out the baby with the bath water.
Unless business schools want to remain irrelevant in this new era, they would be wise to change their tune from "shareholder creation" to something more reflective of what this time period is about. In other words, they do have to change with the times.
It's one of the reasons why if the MBA is going to be relevant in this new era -- that they have to change their mantra from "leadership" (which bakes in so many assumptions of self-interest) to "teamwork" (which bakes in assumptions about contributing to something greater than the individual).
In fact, it's easy to target MBAs, executives, Wall Street, etc. but the thing is we are all to blame. It was the excesses of the prior era that we lived in, and that so many constituents bought into. I'll probably get off topic a bit here, but my main point in writing this is to explain why I don't think business schools alone should take any more blame than any other institution for the excesses of the last era.
The "every man for himself" mentality began in the Gold Rush of the late 19th century, and culminated in the excesses of the roaring 1920s. When that crashed and led to the disillusionment of unfettered capitalism and the "robber barons" (the bankers and the big families of that era - Carnegie, Morgan, Rockefeller, etc.), it ushered in a new era of collective responsibility. FDR's administration during the Great Depression was predicated on that -- that individual self-interest (capitalism) had to be balanced with collective responsibility (New Deal). Public/civic responsibility and big government played a big role from the 1930s to 1980. It's no accident that The Marshall Plan, The United Nations, The World Bank, NASA, etc. were byproducts from this time period.
Where this "balance between collective responsibility and individual self-interest" crumbled started with Watergate and ended with the Carter administration. While the postwar era up until Watergate saw FDR/Kennedy liberalism triumph (that government could do good and that we as a country could collectively do good - the whole "ask not what your country can do for you but what you can do for your country" mentality), those values crumbled starting with a misguided war (Vietnam), and climaxed with Watergate. It was a time of disillusionment with public institutions and by extension the idea that "we're all in this together." Around this time there was also an oil crisis that the gov't couldn't do anything about -- and the erosion of the idea of civic responsibility culminated in the election of Reagan and Thatcher.
1980 began a new era. The NIMBY (Not In My BackYard) economy or the "f*ck you" economy. Reagan best summed up the public sentiment and the era that he would usher in for the next 20+ years -- that government (and by extension the idea of collective responsibility) wasn't the solution, but part of the problem. It was a cynical knee jerk reaction to the erosion and scandal of the 1970s -- that the only way for a country (whether it's business, politics, community, etc.) is every man for himself. Screw public institutions. Screw collective responsibility. Let me mind my own business and you mind yours.
It was during these next 20 years (and Clinton was really more similar to Reagan than the classic liberals a la FDR or Kennedy) that was unlike the post-war era. Self-interest resulted in extraordinary growth and wealth creation -- and while the "trickle down" theory certainly did lift many boats, it was nevertheless skewed towards a minority -- but hey, when even the little guy was doing okay, no one was complaining about the NIMBY mentality. However, it was also during this time that we willingly (as voters and taxpayers) neglected public institutions in favor of self-interest. We want lower taxes, more individual wealth, higher stock prices, etc. but health care, education, and regulation would be victims we're willing to sacrifice for it.
If Watergate heralded the beginning of the end to post-war liberalism, 9/11 heralded the beginning of the end to the NIMBY era - and the nail in the coffin is our current financial crisis.
So it's easy to blame just one institution (business schools) for our ills, but the reality is it's a byproduct of the era we lived in from the 1980s onwards, which was a response to the failures of liberalism in the 1970s. Same with Wall Street, business executives, Republicans, Bush, etc -- we can blame all these people, but the fact is these institutions and people were byproducts of the era we lived in -- the underlying assumptions that we all lived by to some extent either religiously or tacitly by "playing along". We lived in a "greed is good" era and have only realized that "greed" isn't enough. With problems such as terrorism/extremism, climate change, health care, education, and the financial crisis, the sentiment now is that we can't just care about our own lot - that we are all in this together and that it will take a COLLECTIVE effort to solve our most pressing problems - both at the global as well as at the community level. That is where the public sentiment is right now, and is why we elected someone in office who seems driven to restore that balance between individual self-interest and collective responsibility. It wasn't "YES I CAN" but "YES WE CAN" that voters and the media really responded to.
The public outrage today over so many of the failed private and business institutions of the last 10 years is really a mirror image of the public outrage in the 1980s over the public and gov't institutions of the 1970s.
Just like we blamed public institutions for our ills 20+ years ago, we are now blaming free markets for our ills now. There's good in both, so let's hope that we don't throw out the baby with the bath water.
Unless business schools want to remain irrelevant in this new era, they would be wise to change their tune from "shareholder creation" to something more reflective of what this time period is about. In other words, they do have to change with the times.
It's one of the reasons why if the MBA is going to be relevant in this new era -- that they have to change their mantra from "leadership" (which bakes in so many assumptions of self-interest) to "teamwork" (which bakes in assumptions about contributing to something greater than the individual).
27 Mar 2009, 10:56
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Let's be real. MBAs, like all businesses, value GREED, but call it something else like efficiency or profit. This is the main problem. "Greed is good" is secretly one the most common personal mantras of bankers all over the world.
Unless you specifically address the conflict of interest in valuing greed and at the same time pretending to teach ethics, you will always have huge problems when huge amounts of money are at stake. Any scenario where greed vs. ethics battle it out in a near tie, just double the amount of money at stake and greed wins.
The MBA application process doesn't work because the smartest people know how to craft an application to hide any ethical issues they might have in their personality.
What is the solution to this? I don't know.
Unless you specifically address the conflict of interest in valuing greed and at the same time pretending to teach ethics, you will always have huge problems when huge amounts of money are at stake. Any scenario where greed vs. ethics battle it out in a near tie, just double the amount of money at stake and greed wins.
The MBA application process doesn't work because the smartest people know how to craft an application to hide any ethical issues they might have in their personality.
What is the solution to this? I don't know.
27 Mar 2009, 11:40
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zoinnk
I also disagree with the original quote. Of the big 3 grad schools (law, medicine, and business), MBA admissions relies on a standardized test score the LEAST. Have a look at the averages - people get into HBS all the time with 680's/690's (88%tile to 90 %tile), and the average GMAT at HBS is around 94 %tile. The average LSAT at Yale Law is 173, or 99%tile, and Harvard Law's is ~172, which is also about 99%tile. Good luck getting into one of those schools if you're in the 88 %tile.
If I've learned one thing from MBA applications so far, it's that it takes a whole lot more than a nice GMAT score to get into a top MBA program, and you can definitely get in without a stellar GMAT.
