Sustainability, social impact, collaborative learning, and more

| April 5, 2011 | 0 Comments

By Rahim Kanani

An interview with David Schmittlein, Dean of the Massachusetts Institute of technology (MIT) Sloan School of Management.

On what did you focus in your opening speech to this year’s incoming class?
I told the students that to stay in that safe zone of what you already do very well is narrowing. I also talked about why we at MIT Sloan include aspects of values and ethics early on in our programme. And I talked about the school’s mission. A mission-driven institution follows its own compass and trusts that compass, not to the exclusion of looking outside, but starting from some foundational principles. MIT Sloan chooses to develop principled, innovative leaders who improve the world, and to develop the ideas that improve management practice.

The terms, ‘principled’, ‘innovative’ and ‘improve the world’ are not typically in other management schools’ mission statements. And we mean them. We talk about a commitment to improve the world, and to understand how all organisations can and must have that impact. The social contract that businesses have with the world is changing, and unless all organisations can demonstrate and explain the social purpose and the social value that they’ve fulfilled, they will fail. Describe MIT Sloan’s philosophy MIT broadly has a history of open innovation to create positive impact. Its course materials made available for free on the web for everyone’s use are certainly well known and well respected. We take what we as an educational institution have and say, “Here it is. We want to be valuable to the world and so we’ll give you, for free, what we happen to have.”

Mission-driven institutions have principle and passion and a commitment to high standards, but often also have an expectation that the world will understand these elements without needing to be shown the value that stems from these principles. It is a delicate yin and yang to balance, but every organisation, I think, functions best when it has both a deep passion about vision and mission, together with an ability and willingness to be sensitive to external conditions and the way that you translate mission into things that the world values right now.

Do you think business schools have been unfairly targeted following the collapse of the economy? And is there a sense of burden amongst the schools?
In today’s political and social environment, universities too often imagine that people understand their value without feeling the need to explain it. Let’s consider specifically a school of management: if its ‘value’ and ‘purpose’ is only understood to be that of helping students maximise their personal fortunes, or helping organisations find a way to charge 25 cents more for a box of breakfast cereal or US$250 million more in an initial public offering, that’s a very limited mission and vision and while not illegal, or unethical, nonetheless not likely to be seen as sufficiently worthy of admiration and respect.

I think this crisis made clear that relatively few organisations had no connection to it: political organisations, social organisations, business organisations, and not just financial services organisations – all had a role. All need to learn from the experience; all can do better. Are we among them? Sure.

How is MIT Sloan organised?
We don’t organise ourselves as a school around the usual departmental boundaries of Accounting and Finance and Marketing and so on. Instead, this is a school that focuses on unusually big problems and needs of the world. And it sees those problems for the system-wide challenges that they are; indeed, a systems approach to understanding the world and understanding business came out of MIT. And because of that systems perspective, there is a disinclination to see a problem as an Accounting problem, or a Marketing problem, or a Manufacturing problem. It is rather a system that needs redevelopment, usually by applying multiple perspectives, academic disciplines and business functions.

It seems that the faculty embraces the social contract it has with society, but how does MIT Sloan instil that same spirit in its student body?
We try as best we can to ask about character and self-conception in the interview process. Those are challenging discussions to have with an applicant, because many think of a school of management as about professional advancement. So we pursue issues of moral reasoning, in interviews conducted exclusively by our own professional interview staff. Moving on to the MIT Sloan coursework, we develop leadership with principle and values through our distinct commitment to global action learning. Quite simply, we do more global experiential learning, in real business settings, than any other leading school. I was astonished by the level of it when I came to MIT.

How does MIT Sloan define global action learning?
The lion’s share of our students engage in an international project-based course that runs for a full year. We discovered that cross-functional learning is better built in entrepreneurial and smaller, lower-resourced organisations than in large wellendowed organisations. We work with resource-stressed entrepreneurial firms in, for instance, Chile, Columbia, the Philippines, Vietnam and Uganda. We don’t work in those countries because it’s cheap and easy, because it is neither. But our students come back truly changed when they go to Uganda, for instance, and are charged with working with an organisation whose purpose is to get HIV/Aids treatment out of the urban centres and into rural centres in a way that’s financially sustainable. Doing so has challenged our students to come back and think about the purpose of all organisations. Not all of our graduates have been convinced to work for a social service organisation in the developing world of course, but even when they go to Novartis or Google or McKinsey, they ask about the kind of social purpose that they can anticipate and contribute to through that organisation.

And those hiring organisations now understand that they need to have really credible answers to those kinds of questions. These questions don’t come from being in a tiered classroom and arguing about paragraph 12 of a case written about those organisations.

How is the course integrated into the school year?
We protect a period in January – essentially a month – and they go to the region during that period. But the course itself runs for the full academic year. And so the students know what the project is going to be, who the sponsor is, what the key issues are, long before going to the country, and they spend the fall semester with the politics, geography, sociology of the region and understanding the business context in the region. They also spend some time, at a distance obviously, with the particular business issue that they’re going to face when they’re there. And then when they return from the incountry experience, they spend part of the spring semester doing a debrief reflecting on the learnings, interacting with their classmates. This course doesn’t have that ‘boy that was great, now I’m back, and I can take my real courses again’ flavour. So another important aspect of the course structure is its depth: learning and preparing, then acting, then reflecting.

This kind of commitment prepares better managers – not only solving real business challenges, integrating the business functions of accounting, finance, management and marketing, but also handling the stress of dynamic business environments with resilience, and connecting the organisation’s market value with the values that stem from its social purpose.

Speak a little bit about MIT’s global footprint, and how you plan to project the image of MIT’s difference-making mission to the world.
We have a great set of partner institutions – mostly educational institutions – around the world. They are not, however, a random collection of highly ranked schools, nor are they economic partners in the sense that we engage with them to create money-making educational ventures. Rather, they generally have three key characteristics.

First, we typically work with the leading or likely to be leading school of management in a rapidly developing part of the world. We have opportunities to work with the best because of the especially deep appreciation for MIT in those regions: a sense that fact-based decisions are what the developing world needs, that smart is good, and that innovative business activity is a path to economic and social development. A second characteristic of our partnerships is the commitment to doing something innovative and worthy – usually both bringing better management practices to a country by developing the indigenous, or home-grown, capacity for management education (i.e. a ‘train the trainer’ model) and also supporting research on emerging business practices in dynamic regions. This is typically what the business and government leaders of a region most want. They want to build it for themselves.

Our partners – and we – are intent on changing the character of management practice and economic development in a region. The third aspect of our partnerships is our focus on rapidly emerging economies. We began 15 years ago with a depth of interaction in China unique among leading Western schools, and then brought that same type of engagement to Korea, Brazil, India and Russia. In terms of visibility, MIT Sloan actually has a different kind of challenge within the USA. There is a troubling  strain of management thinking in this country that actually undermines our global competitiveness as a society, that imaginesmanagement is about charisma, instinct and the emulation of a few supposed gurus and previous CEOs. We as a school have work to do to have people understand the importance of systems thinking, complexities in inputs and outcomes, factbased decisions that are made rigorously and yes, the abiding and central importance of innovation based on a deep knowledge
of technology, customers and markets. MIT Sloan’s work resonates in these tough times.

How does the school’s focus on Science, Technology and Engineering feed into the business school education?
MIT has receptivity to bringing teams of individuals, students and faculty together across schools, particularly blending management students with Science and Engineering students – and, in some cases, faculty – to pursue ideas that have entrepreneurial potential. We have a great deal of interest in sustainability here at the school and part of that is driven by a desire to invent a positive future for the world. Our interest in sustainability is also driven by a sense that it is one of the important transformations in business models that we’ll appreciate in 10 years or 20 years as among the major determinants of which kinds of organisations succeeded and which kinds of organisations didn’t succeed.

Speak for a moment about knowledge creation.
The need for real, valuable management knowledge has never been greater. The cost has also never been greater. And for any single school, the return on such costs has never seemed more uncertain. Schools that do not really invest in knowledge creation are increasingly serious competitors, and some of the newspaper and magazine rankings make those schools seem quite credible. Their negligible investments in research allow them to earn a positive economic return from degree programme tuition alone. At MIT Sloan, no more than 50% of our annual financial inflows come from degree programme tuition. We exist as a real leader among schools of management because our friends, as well as alumni, see a need in the world for a certain kind of truth-telling, a certain kind of positive transformation in business models, a certain kind of principled and effective innovation, and are willing to support it.

This article is based on an interview conducted by Rahim Kanani for the Huffington Post and appears here with his kind permission. Kanani is a graduate student at Harvard Divinity School in Religion, Ethics and Politics, and a research associate at Harvard Kennedy School in Justice and Human Rights.

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Category: Autumn 2011

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