What values?

Last night, coming home from parent-teacher-student conferences, I happened to catch Background Briefing on ABC radio, talking about some of the root causes of the economic crisis, and particularly the role that business beliefs and values (aka greed) played in the problems that arose.

The program was talking specifically too about the role of Harvard Business School in helping establish and promote the values of ‘profit maximisation’ at any cost that proved so devastating later on. I’m obviously no economist but I’ve blogged about the hypocrisy of some of the banks and businesses a little before and I’ve often been struck by the gulf between the values that schools promote and celebrate (diversity, collaboration, social justice, environmental awareness, positive participation) and the values lived by some of the business leaders in real life. (competitiveness, cut-throatness, profit over people, exploitation of resources etc)and how that collision is rolled out.

I’m reminded of a somewhat twee little book, which may contain a kernel of truth, called All I Really Need to Know I Learned in Kindergarten, which argues among other things that the simple social learning of sharing, helping each other etc, emphasised in pre-school, were the important enduring behaviours.

Last night’s program focused on just how some of the business values were shaped and developed and these extracts from the transcript give something of the flavour of the discussion.

Stephen Crittenden: Everyone we spoke to for this program was quick to point out that there are many very capable MBAs, and many good business schools offering sensible MBA courses.

But the number of failed CEOs with MBAs has not escaped notice. Stan O’Neill and John Thane at Merrill Lynch, Andy Hornby at HBOS, and the best-known of all, Enron’s Jeff Skilling who’s serving a 24-year jail sentence, and the former President of the United States, George W. Bush.

McGill University Professor Henry Mintzberg says what we call a financial crisis is really at its core a crisis of management, and not just a crisis of management, but a crisis of management culture.

Henry Mintzberg: It’s a syndrome, it’s a whole attitude. We’ve corrupted the whole practice of management, it’s utterly, utterly corrupt from top to bottom; not everybody, but much too much of it is corrupt. It is a cultural problem. And by the way, it’s largely an Anglo-Saxon problem I think. I think the worst of it is in the US, and second is the UK. I think Canada has been smarter. In England the UK for example, there’s a long history not just of MBAs but of accountants running everything. In other words, what you had is a detachment of people who know the business from people who are running the business.

Stephen Crittenden: Another critic of the MBA is Harvard Business School Professor Rakesh Khurana. He says the business schools have been teaching some pretty anti-social theories which their graduates go away and put into practice.

For example, Rakesh Khurana says it was the business schools who were the source of the theory of shareholder maximisation. They originated the idea of using derivatives and credit swaps to manage risk, and the idea that managers are so fundamentally self-interested that they can’t be trusted to do their jobs unless they’re provided with huge stock options.

Rakesh Khurana: What we taught were very simplified and not necessarily accurate models of human behaviour, that over time become self-fulfilling. And so there was this model that in fact by basically being self-interested to an extreme, that was the appropriate way to behave and act. And what that does over time, because this is not an innocent exercise, it actually over time because it is a professional school, comes to shape the identity of those individuals. That is, they begin to see themselves in those views. And one of the consequences of that is that if you look with respect to executive compensation for example, and the incentives around that, the view becomes that I actually have to be compensated to do the job I was hired for, and on top of that you have to bribe me with stock options to make sure I do that job. In no other occupation or profession is that part of the modus operandi.

Stephen Crittenden: This is also a story about how society educates its elites. Phillip Delves Broughton is a former Paris correspondent for Britain’s Daily Telegraph. He recently took two years off to do an MBA at Harvard Business School – HBS – and he’s just written a book about the experience. Here’s the man himself, reading from his book.

Phillip Delves Broughton: A second year student rose to welcome us, and to reiterate the importance of values to our future in business. He told us that simply by getting into HBS, ‘You’ve won’. From now on, it was all about how we decided to govern our lives. What he said would be repeated throughout my time at Harvard. Harvard Business School was a brand, as much as a school, and by attending, we were associating ourselves with one of the greatest brands in business. We were now part of an elite, and we should get used to it. I struggled with this idea. It seemed so arrogant on the part of the school, and somehow demeaning to those of us who had just arrived. Regardless of who we were when we arrived, or what we might learn or become over the next two years, simply by being accepted by HBS, we had entered an über-class. It was Harvard Business School, not anything that came before it, that conferred the ‘winner’ tag on all of us.

The full transcript of the conversation is here. You can also download the audio HERE.

Education Revolution: Australia Talks

Radio National’s Australia Talks program had an interesting discussion on the ‘education revolution’, national curriculum and assorted responses to educational issues including the crowded curriculum.

The thing  liked was the refreshing lack of politics to the discussion, thg good sense and, from a couple of speakers, the emphasis on hearing student voices in the debate. Would it were so.

Listen HERE