"First Kill All the PhDs"

This is BusinessWeek.com'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?

LIFELONG THEORIZING

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.

"CRITICAL THINKING"

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.

Reconsidering Centers of Excellence

Many years ago, more than I'd like to remember, I published a book with Jack Behrman, entitled Overseas R&D Activities of Transnational Corporations, and in that book we briefly considered "Centers of Excellence." At the time, I was underwhelmed by the concept, but today, in a Leading the Global Enterprise [IMD's new program] discussion of innovation in a global organization, the wisdom of Centers of Excellence became more apparent.

What we know from the Virtuoso Teams project is that: dedicated teams are important; physical intimacy in work-areas desirable; in-touch leadership essential; and we also know from decades of economic examination that there are economies of scale associated with R&D and innovative teams. So, how to achieve these in globally dispersed organization? My sense is that we should be reconsidering Centers of Excellence on a global scale, as they may offer the best organizational platform for achieving many of the elements associated with successful "big" change.

Ambitiousness

Even if not fashionable, I am in favor of ambition. Being ambitious, allowing justifiable elites to emerge on the basis of superior performance; and letting people become stars is what drives an organization forward. I believe that organizations that win in the talent-wars do it one individual at a time. And, that by enabling talented people to fulfill their potential, we increase the likelihood that we all win.

Talent Under-Utilization: a damning indictment

The blogsite "Liquid Generation," yesterday -- January 22, 2008 --, had a damning indictment of talent utilization at a company we all know: Yahoo!:

"Yahoo - You've held back thousands of very talented people for the last 5 years, and prevented them from making the fullest use of their talents and insights. We would all be better off if these guys were freed from your shackles; keeping them inside your doors - working on dead-end projects and hamstrung by political infighting reminiscent of an industrial era monolith like GM - is by far the least productive use of their time.It is, ultimately, because your management is lame."

I don't know if this is really the case at Yahoo!, or not, but what I do know is that this is the sort of indictment that you don't want to have associated with your own leadership legacy!

Optimism Matters! Choose "Nuts" not Bullies

Optimism as a leadership attribute matters! I completely believe this. There are some organizations that I work with where the degree of pessimism is so omnipresent, that it is painful to even talk about the future. Yet, in our work on Virtuoso Teams, we found, emphatically, that teams, and individuals, who believed in themselves and their ability to change the world were often able to fulfill that dream. Anyone who has ever watched Apollo 13 knows full-well that without Gene Kranz's belief in his team, the three astronauts adrift in space would never have returned. Kranz never gave anyone the chance to be pessimistic, or even skeptical.

Today, in casual reading of two blog sites that I occasionally look at, I was struck by a coincidence of conclusions that speak directly to positivism as a leadership trait. Jeffrey Phillips, on his Thinking Faster blog posting "Management Throttle," January 17, 2008, talks about how important a postive attitude is for a leadership team, and how it sets the stage for others in the organization to buy into. Bob Sutton, who is a Professor of Engineering and Management Science at Stanford, and an IDEO Fellow, has written, on his Work Matters blog site, a posting entitled "John Bolton: Even The Economist Thinks He's an Asshole," January 17, 2008, about how Bolton's "known history of demeaning and disrespecting others" leads to a situation where, in The Economist's words: "this undeniably talented man of principle often comes across as a domineering bully." Domineering bullies fail in almost every way to achieve the positive attitude that great teams feed upon.

Optimism/postivisim, whether about the likelihood of acheiving a goal [the what's], or the capability of a team to achieve it [the how's and the who's], are essential to releasing talent; while negativism about either what's, how's or who's tend to inevitably diminish talent, and achievement. I am reminded in this regard about an unmailed letter to the editor that I had written on the occasion of John Bolton's appointment as U.S. ambassador to the United Nations. I tried to draw a comparison between the teams of the Virtuoso Teams project, most of whom could be charitably characterized as led by "nuts" with their obsessions of the dramatic visions that might be achieved, and those led by bullies. You'll recall that at time that Bolton had been characterized in congressional hearings, as a bullie. I don't know Bolton, and have no first0-hand impression of management style, but I've seen plenty of bullies in my time, and I know that bullies are never good for anyone, or any organization, ever. What I wrote at that time was:

In the Virtuoso Teams book, we’ve studied a number of successful leaders: Miles Davis, Jerome Robbins & Leonard Bernstein, Sid Caesar, Thomas Edison, Roald Amundsen, Groves & Oppenheimer of the Manhattan Project, and the like. Not all of them were nice people, but they all did amazing things, in unconventional ways, and they each changed our world for the better. In every instance, it was how they built their team, and how they treated the individuals within that team, that made the difference. They were not easy; they pushed and stretched and demanded far more than most people were prepared to give, but they did it a way that enlarged the talent of their people rather than diminished it. They were always positive, never negative; about their goals, and about the capabilities of the people that they surrounded themselves with.
As a result, they wound up not only changing their field, but also preparing the next generation leadership for that field. One benefit was that they each had an edge over their competition in great ideas, and they each took full-advantage of the diversity within their teams to really unleash distinctly new ways of thinking about the world to make a difference. Were they tough? Absolutely! Were they abusive? Never! Nuts, maybe; not bullies! The “nuts” all realized that talented individuals can give more if they are stretched, recognized, given opportunities to shine, and appreciated for their contributions. The bullies, on the other hand, are so intent on reaching their own personal goals that they crush the talent entrusted to them and never reach the limits that are possible.

The acid test is always: how does the assembled talent look back on the experience? Those who worked for “nuts” almost always refer to the experiences with affection. Those who worked for the bullies typically wind-up before Congressional committees.