Monday, November 8, 2010

"First Kill All the PhDs"

This is's choice of a title for the piece, and although I hope that I would never be that aggressive in my choice of remedies, there are times and places where the sentiment comes to mind:

Education is too important to be left to educators. At least that's my feeling, and as a professor, I just might know something about this. According to China's Global Times, in a study last year by the International Assessment of Educational Progress in 21 countries, Chinese students ranked first in the world in mathematics, but they were last in imagination and fifth from the bottom in creativity. Which would you prefer? For me, creative people can hire mathematicians—if they need them. But it's much more difficult for mathematicians even to become aware that they need creative help.

At the same time, the Shanghai Daily reports that the patent activity of China's top 500 enterprises is up 13.3 percent from the prior year, yet no one is asking what impact, if any, these patents are actually having. In a recent column in the Financial Times, Tyler Brûlé observed: "I tried very hard to think of Indian, Russian, and Chinese brands that I owned or used, and I couldn't think of any—no Russian design brands in my house, no reservations at any Indian hotels, and no Lenovo laptop in my bag." Granted, brands and innovation are not necessarily synonymous, but there are associations that cannot be denied or ignored.

So, who's to blame? The Global Times suggests that China's education system, with its emphasis on rote learning, is a part of the problem. In fact, IMD's 2010 World Competitiveness Yearbook reports that China's education system has been in decline since 2007 in terms of how well it meets the needs of a competitive economy, presently ranking 44th out of 58 countries—below countries such as Greece (43), Kazakhstan (35), and Qatar (14). Finland, on the other hand, which ranks 1st in this category, is a notable reference point that people speak about with respect to how its educational offerings in engineering, technology, and innovation are having a direct impact on the economic vitality of the country. Do you ever hear the same about China?


I also would offer an additional candidate for assigning blame, at least as far as business and entrepreneurship goes: having the right faculty is a "must." During my sojourn in China as an academic and as president and dean of the China Europe International Business School, I was frequently struck by the thought that China's scarcest resource might just be "practically experienced" university faculty. Far too many of the Chinese professors I observed in other schools (CEIBS insisted that any faculty had the ability to interact competently with executives) had never actually worked for a living; they were lifelong academics, and everything was "theoretical" for them. This simply does not work if the goal is to transform new ideas into practical solutions. And it is particularly devastating if we are speaking about business schools and their role in preparing a "managerial class" for competing on the world stage.

Nor is this a uniquely Chinese problem. Business schools around the world are having great difficulty finding faculty who have sufficient work experience to be credible in an executive classroom. Far too many of the available faculty have tasted only academic life, and given that management is an art, not a science, the practicality of execution is often as important, or more so, than the strategic choice being executed. You just don't get this in a classroom, and if your professors have never had to make a suggestion work, and if their professors likewise lack such experience, then we have a three-generation problem not likely to be easily solved, if it is even recognized.

Like most industries, the innovative arts have their own distinctive "value chain," and a nation's university system is upstream in that value chain, producing educated talent that is available for employment in a nation's economy. With business schools, the talent is most likely destined for employment as key decision-makers who are in the process of creating the future through new product and service offerings. If that talent is deprived of "practical" experience, as a result of faculty without such experience, there is no doubt that innovation and entrepreneurship will suffer. Imagination will as well. Former GE Chief Executive Jack Welch was once asked when GE will be unable to continue to drive productivity improvements in such old-economy businesses as light-bulbs and railroads. He exclaimed: "That's an absurd question. Productivity is limited only by your imagination." But "informed" imagination, to be sure. What appears to be lacking today, in China and elsewhere, is academic faculty with sufficient practical experience to nurture such imagination in an effective direction.


Solving this problem is not particularly straight forward. The merit in insisting on PhD education for business school faculty lies in both their capacity to do and appreciate complex research methodologies that allow us to drill below what often amounts to simplistic management "wisdom." This education also encourages "critical thinking," which is important if such scholars are to be able to separate truth and insight from careless analogies and misplaced associations. Yet the price to be paid for attaining such skills is often the pursuit of a purely academic life, without the opportunity to see the management challenge on a distinctly personal level.

My own school, IMD (IMD Full-Time MBA Profile), on the other hand, prides itself on its practicality and has taken as part of its brand-promise the slogan "Real World, Real Learning." This may be iconoclastic in the academic world, but we find that the more than 200 corporate learning partners who come to IMD each year believe this is an essential ingredient for the development of their executive talent. It is hard to believe that such a promise would not also be attractive to China, as well, unless China is content to produce mathematicians to be hired by our managers.

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