Home/ Opinion / Online Views/  Opinion | From “hired hands” to “higher aims” in management

Trying to familiarize myself with the subject of business education before I took up my current role last month, I had asked a friend to suggest readings. He mentioned Rakesh Khurana’s From Higher Aims to Hired hands. The book was written first in 2007, a year before the global financial and economic crisis broke out. It was a clarion call for a return to the original and higher aims for business education. Ten years after the crisis, it is clear that the call is yet to be heeded.

The original goal of business or management education was to turn management from a vocation into a profession. Professions require a certain set of core skills. Along with that, the original founders—Joseph Wharton was one of them—envisaged managers keeping in mind the larger purpose. Serving the community and contributing to public policy were examples of some of these larger purposes.

A liberal arts education was deemed the natural foundation for professional managers. Therefore, the understanding of history, politics, evolution of societies and communication skills were as important as core functional skills.

However, the gap between aspirations and delivery always existed. In the 1930s, Abraham Flexner examined 15 volumes of case studies published by the Harvard Business School and found “not the faintest glimmer of social, ethical, philosophic, historic or cultural interest" in any of them. It will be useful to know if the criticism is more or less acute now. However, increasingly, it appears that recruiters are looking for such perspectives from management graduates.

If one reviewed the recent survey of employers—more than a thousand of them were sampled across three continents—conducted by the Graduate Management Admissions Council, employers felt that “integrative reasoning" was one of the most important skills that they expected of business school graduates. They added that it was the most difficult one to find too.

The council had defined integrative reasoning as the ability to organise, evaluate, synthesize and combine information. With so much information available, collecting it is not that difficult. However, organizing it is critical. Second, once organized, one has to learn to separate noise from information. Plenty of it is noise or motivated editorializing or promotional content masquerading as information. The third thing is to synthesize information presented in multiple forms—texts, numbers and graphics. The final and the most important thing is learn to combine information from multiple sources, multiple disciplines and multiple perspectives. That is “connecting the dots". Liberal arts education is a good foundation for developing these skills.

Post-World War II, however, American universities moved away from the vision and goals of their founding fathers. Cold War rivalry combined with patriotism paved the way for management education to focus on production, processes and efficiency. Management as science was the answer to staying ahead in the Cold War. Homo Economicus was the assumption about humans interacting in an organizational setting. This assumption did not go unchallenged.

Khurana captures the clash between the neoclassical school of Franco Modigliani—relying on the assumption of humans being rational decision-makers—and that of Herbert Simon which, among other things, led to Modigliani moving to Northwestern University. A recent news-story (“Competitive about Your Meditation? Relax, Everyone Else is Too", The Wall Street Journal, 12 June) about how some people engaged in the practice of meditation were willing to cheat to prove that they were meditating more than others shows that rationality is more an exception than a norm. Humans have the knack of often confusing means and ends.

During this period, research was emphasized in specific disciplines. Indeed, the big question was whether business schools ought to be “research and doctorally oriented or maximize a pedagogy designed to produce managers in the economy?" Countries like India do not have the luxury of choosing between the two. We need rigorous research and we need to produce competent managers. In practical terms, we need business school faculty to be animated both by research and by teaching. In turn, it means that the institutional roles that they are often asked to play must be handed over to experts hired for such purposes so that they could concentrate on research and on teaching.

From Homo Economicus to shareholder wealth maximization was but a short step. To a degree, the emphasis on rewarding the owners of capital did help to improve managerial performance. But the declaration that the raison d’être of managements was to increase profits to the total exclusion of all else reduced management from being a profession with noble aims to one of “hired hands".

In a powerful sentence towards the end of his book, Khurana writes, “lacking either the religious framework invoked by the founders of the modern university and the university-based business school, or shared agreement about basic societal values, we have no meaningful language for civic discourse about the ultimate purpose of our secular institutions." He calls for a reinvention of institutions of management education because, in his view, they have lost their legitimacy. It means going back to the founding vision of business education.

V. Anantha Nageswaran is the dean of the IFMR Business School. These are his personal views. Read Anantha’s Mint columns at www.livemint.com/baretalk

Comments are welcome at views@livemint.com

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Updated: 12 Nov 2018, 09:41 PM IST
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