Over the past decade or so, wide varieties of economic and competitive forces have directly impacted American-based management education institutions. Many of the factors and conditions that have upended traditional institutional business models reflect external influences over which, one could argue, business schools had little control. While they should not be blamed for the onset of the many disruptions that continue to resonate today—new market entrants, globalization, technological and demographic shifts, price-point sensitivities and student demand for flexibility, for example—business schools could have been more prescient in anticipating these trends. Many institutions were far too risk-averse to adequately respond, and those that did respond did so too tepidly and too late.
The failure to anticipate the implications of online competency-based education on traditional business school operating models was a failure of imagination. While some of the more calamitous warnings about the demise of business schools in this country were speculative at best, there should be no doubt that the economic and competitive market in which we all operate has been permanently altered. Business schools were wedded to a conventional approach to management education, which reflected historical orthodoxies associated with higher education in general. Many of these orthodoxies continue to stymie needed innovations. Business schools focused on what they knew best and what had worked previously, instead of focusing on the markets they sought to serve. Traditional curricular content and structure, pedagogies and legacies prevailed, and in too many instances, still do.
Today’s marketplace is defined by incumbency versus disruption. As incumbent institutions, it makes little sense for business schools to attempt to become disruptors. However, if they want to ensure their long-term viability and meet the needs of critical stakeholders over the next decade or so, business schools will need to focus on three broad themes that will continue to define the management education landscape.
First, business schools must recognize that the demands of today’s global marketplace, defined by volatility, uncertainty, complexity and ambiguity (VUCA principles) demand a new set of skills and abilities. In this sense then, business schools must align themselves with an evolving context for leadership, which should be embedded in the curricular and co-curricular experiences of business students. Traditional models of leadership are defined by stability, cyclicality and predictability (strategic plans, for example, as the approach to execution).
Today’s challenges are characterized by asymmetrical and multilateral forces, which require business schools to adopt an evolving context for leadership with a focus on technology, globalization and climate change, as well as on the marketplace as an enabling agent of change. While technical skills remain essential—including the capacity to solve linear cause and effect problems—as does expertise, a more contemporary model of leadership development focuses on adaptive capacities. In this context, the emphasis is on discernment and skillful navigation in real time and on non-linear cause and effect.
Second, business schools must create reciprocal, mutually beneficial collaborations with critical private-sector partners in order to prepare today’s students for an economic marketplace that, in many instances, doesn’t yet exist. Most schools can’t accomplish this on their own. Partnerships with private-sector entities go beyond the standard internship, full-time placement and academic project support, and are instead defined by recalibrating the very essence of the academic enterprise: the curriculum. Co-creating, co-branding and co-delivering programmatic and curricular activities represents the next frontier of engagement between schools and colleges of business and their private-sector partners. This reflects an uneasy, but in my view essential, sea-change. Curricula and related activities have historically been the sole domain of the faculty and an extension of the academic enterprise. Business schools that cling to this worldview will do so at their peril.
The final theme reflects the need for business schools to recalibrate their approach to ensuring access to an increasingly selective, mobile and technologically savvy consumer. While traditional courses and degrees remain staples of today’s programmatic portfolio, flexible certificate programming, stackable credentialing and online and blended programs are redefining how many students demand to access management education. This is especially critical for working professional students who wish to avoid paying the often exorbitant opportunity costs associated with leaving their jobs for traditional full-time programs.
The need for business schools to adapt their approaches—as well as their requisite business and revenue models—to a new market is imperative. Online competency-based programs remain significant competitive threats in today’s market. Too, the near commoditization of the management education industry makes it difficult for all but the most sophisticated consumer to discern the difference between many of the programs offered via new and innovative and traditional platforms. Finally, the proliferation of new degree programs from highly reputable business schools and other academic institutions, including Georgia Tech, offer a clear indication of an altered landscape that demands a different approach.
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