We live in interesting times. This much is certain. But global events have become far more unpredictable, and that has brought new urgency to the business executives’ questions about the value of the MBA.
Context is important here. One has to understand where this volatility stems from in order to figure out the value of the MBA experience for steering organisations in this new disrupted world.
The long-term effects of global trade and borderless technological innovation have already started to strangle smaller economies and put enormous pressure on larger countries to invest more resources in developing and keeping a competitive advantage. That is further amplified by the extreme volatility of multipolar geopolitics and the desire of governments to regulate everything from tax to social media. “Sanctions”, “great deals”, and “privacy” are the buzzwords of the decade, with major corporate players, both east and west, trying to navigate and evolve within the volatility of the global arena. Last, but not least comes the mind-blowing pace and scope at which technologies and digitalisation are reshaping the world and every aspect of our personal and professional lives.
In fact, this notion of uncertainty has become so prevalent that an old military term from the 1990s has resurfaced to describe it – VUCA, short for volatility, uncertainty, complexity, and ambiguity or, as Harvard Business Review puts it, “a catchall for ’Hey, it’s crazy out there!’”.
So in a world defined by VUCA, is it still worth it to embark on an MBA degree that might become obsolete by the time it has been obtained?
The short answer is “yes”, the long answer is “there has never been a better time”.
The MBA’s take on complexity
The MBA has always been about keeping up with the trends in order to teach managers how to perform better in the current environment. In the 1990s it was about big multinationals’ expansion into new markets, so the MBA taught managers to focus on building loyalty through internal job mobility and rewards systems in order to create a sense of belonging to a large organisation. In the 2000s it was about opportunity, sustainability, and innovation on a smaller organisational scale, so the MBA taught managers how to promote creative collaboration in order to build more involved, more efficient teams. And as the 2010s are about unprecedented technological growth and VUCA, MBAs now teach concepts such as digital transformation, lifelong learning, talent management, business nimbleness, and ethics in order to provide an overarching view of the disruptive trends that are poised to change the global workplace in the coming decades.
Retired American four-star general George Casey, who led the multi-national forces in Iraq in 2004-2007, teaches a two-week class at the Johnson School of Management at Cornell (US), called Core Leadership Skills for a VUCA World.
According to Casey, managers lead organisations to success by grasping the concept of “total environment” or, in his words, “not just your internal environment, but also your external environment”.
“If you have a comprehensive understanding of [your total environment, your competition, and the relationships outside of your organisation] that can help you succeed, and [if] you go deeper than everybody else does, you can succeed in a VUCA environment where others don’t”, General Casey assures us.
That is exactly the kind of insight that adds value to the MBA in a VUCA world. On the hand, there is the hard knowledge on how to deal with VUCA from proven leaders who have experienced the phenomenon first-hand and on the other, there is the opportunity to learn through failure in a safe but challenging environment.
The MBA is like a think tank without the pressure of public scrutiny or having to justify the funding. Being a controlled environment, the MBA classroom’s biggest advantage is the ability to share ideas on how to deal with problems, without the risk of taking a wrong step. But first, students learn how to define the problem. As business school professors like to say, “A problem well stated is a problem half solved”.
“The most important analytical techniques for MBA students to learn are not necessarily specific nonlinear solution techniques. Rather, it is learning the basic concepts of how to conceptualise, formulate, and model difficult problems”, says Michael Fry from the University of Cincinnati.
This is key to the problem-solving mechanisms taught at the MBA, but it is only the basis. The actual solutions are born from the collaboration between distinct experts, which is how think tanks operate.
The MBA classroom works like a smelter that filters out the unworkable solutions by bouncing ideas between academics, practitioners, and MBA students, all with their unique knowledge and leadership backgrounds. This often leads to classrooms looking and feeling more like the White House Situation Room than a lecture hall. Be it a real-life case study on how Facebook dealt with the Cambridge Analytica scandal, a fictional crisis about sanctions affecting the supply chain, or a strategic plan to cope with talent shortage, the goal is always the same -to adapt to the conditions in order to present a feasible solution. This three-way communication between students, faculty, and business is engraved in the very concept of the MBA and is what separates it from other forms of postgraduate education.
Dealing with VUCA
Needless to say, business schools are well aware of what VUCA means for organisations around the world, what causes it, what it leads to, and how to navigate it.
Going back to General Casey’s remarks about the significance of “total environment” in dealing with VUCA, it is important to note that the abstract notions of a bird’s-eye view and collaborative problem solving are far from the only things taught in the MBA. In fact, many MBA programmes have adapted their curricula to include some very tangible courses on trends associated with VUCA.
Amsterdam Business School (Netherlands) introduced a specialised MBA programme on Big Data & Business Analytics in 2016. In the same year, Kellogg School of Management (US) started offering courses in Machine Intelligence. Berkeley Haas (US) has incorporated a course in Applied Data Analytics in their Full-time MBA curriculum and INSEAD (France) runs a whole range of open programmes on digital transformation and innovation as part of their Executive Education stream. Ohio State University’s Fisher College of Business (US) offers an MBA in Technology Entrepreneurship that helps students commercialise high-tech innovation. And in an increasingly volatile world, IE Business School (Spain) has introduced an executive-level programme aimed specifically at security professionals.
None of these examples are isolated or incidental. Rather, it is a concerted effort by the industry to establish itself as the corporate world’s main partner and driving force in tackling the challenges of the future workplace.
One of the biggest advocates for the intertwining of business and academia is Professor Dave Ulrich from Ross School of Business at the University of Michigan (US). The world-acclaimed HR and management consultant argues that “action learning”, where many stakeholders are involved in co-creating solutions to complex problems, is especially efficient, as it not only bridges the gap between education and business, but also provides tangible results.
The presumption here is that, through its vast network of relevant peers, business schools are uniquely positioned to combine the persistently relevant training in general management provided by the MBA degree with the insight of academics, practitioners, and alumni, in order to equip graduates with the understanding, skills, and resources to navigate the environment in the interesting time we live in. This intention is clearly exemplified by the ever-evolving MBA programmes and executive education courses aimed at both entry-level managers and C-suite executives.
By choosing to lead the way, business schools face the problem of a globe defined by volatility in a proactive, rather than reactive, manner. This alone constitutes an obvious competitive advantage over most organisations, but more importantly, it dispels any doubts as to the relevancy of the MBA degree in a markedly ambiguous world.
This article is original content produced by Advent Group and included in the 2018-2019 annual Access MBA, EMBA, and Masters Guide under the title “Coping with a Mad World One MBA at a Time”. The latest online version of the Guide is available here.