This Is Karl Moore of the Desautels Faculty of Management at McGill University with Talking Management for The Globe and Mail. Today I am delighted to be in Vancouver sitting down with the Rotman School's former dean of management, Roger Martin.
What do you see as the future, Roger, of business schools? Where do you see business schools going?
MARTIN - Well I am not terribly optimistic, although I will split it. I see a different fate for undergraduate business education than the MBA. I worry that the MBA in general is in for a rough ride in North America. In the rest of the world I think it will be a growth industry for a while, but in the U.S. in particular, I don't see a very bright future unless the MBA world makes some pretty fundamental changes.
MOORE - Why is it in so much trouble and what changes would you suggest they take?
MARTIN - I think that it is in trouble because there is now a rising chorus of this isn't being useful enough for us. There is some data if you look at the Financial Times, as you know, ranks business schools and if you look at the North American business schools and ask what is the economic pay-off to getting an MBA in one of the top 100 schools, 50 of them or so are U.S. schools, it is declining.
So there is a decline in the pay-off in the Peter Thiels of the world, the famous Silicon Valley investor, saying "take the hundred thousand and come and invest in the Silicon Valley rather than an MBA." That whole chorus is, I think, getting more potential students to rethink whether it is relevant and necessary.
I think that is really partly the fault that the MBA programs have brought on themselves. They teach, to too great an extent, the most easily teachable stuff, narrow disciplinary stuff: a finance teacher teaching finance, an accounting professor teaching accounting, a marketing professor teaching marketing.
Those are all important fields but very few actual business problems present themselves as only a finance problem. It is a finance and marketing problem, it is a finance and operations problem or a marketing and operations problem. The business schools have not said problems don't appear in these narrow disciplines. It's not just enough to teach the narrow disciplines, we have to teach how to think about complex managerial problems.