MBA, JD, or PhD

Have you ever asked yourself why management education exists? 

Presumably, we know why law school exists (even the most curmudgeonly among us would admit the first year, and perhaps a fair portion of the second year, are an experience unlike any other, which, if one is willing to submit, changes the way one thinks).  But why MBA school?

I've actually asked myself this question, and I'd like to think I have a little bit of personal history to inform it.

One of the primary reasons I chose to major in economics as an undergraduate, aside from its being a superb department at Princeton, was that I realized if I didn't embark on a formal course of study in economics I wouldn't "pick it up along the way."    The same, probably more emphatically, could be said about the relationship between law school and "thinking like a lawyer."

Once launched out into the Real World, of course, I learned that the MBA credential had market value, if not, as a cynical friend of mine once opined, intrinsic value.  But I chose to embark on the MBA degree program at NYU's Stern School of Business (the evening sessions, which I could accommodate within the exigencies of my day job as a securities lawyer at Morgan Stanley/Dean Witter), and, with the exception of a final group project that fell victim to a preposterously dysfunctional group, I completed the coursework for the degree.

So what do I think?

With apologies in advance to all the MBA's in the crowd, I'm tempted to repeat the opening question.

Immediate caveats:

• If you haven't otherwise been exposed to finance or accounting, or if you find them alien languages, any respectable MBA program will remedy that, and they do provide, of course, the shared language of business.
• A few other core courses do instruct you in things you probably wouldn't "pick up as you go along," such as statistics and operations theory (there's a reason banks have one line for all tellers and not one line for each teller).
• But in terms of the vast run of courses in such topics as strategy, leadership, personnel management, human resources, and marketing, my experience was that they added up to repeated and almost incessant statements of the obvious.  You doubt me?  How about this for a gem, from my marketing professor:  "Make it easy for customers to do business with you."  I'm not making this up.  I couldn't.

These thoughts are occasioned by the release of The Management Myth:  Why the "Experts" Keep Getting It Wrong, which was reviewed in the WSJ yesterday.  The author, Matthew Stewart, has expanded upon an article he published three years ago in The Atlantic also called "The Management Myth," which opens with how he spent his time after seven years in the consulting business, which he entered (improbably) without an MBA but with a Ph.D in philosophy--19th Century German philosophy (Heidegger, Hegel, Nietzsche):

After I left the consulting business, in a reversal of the usual order of things, I decided to check out the management literature. Partly, I wanted to "process" my own experience and find out what I had missed in skipping business school. Partly, I had a lot of time on my hands. As I plowed through tomes on competitive strategy, business process re-engineering, and the like, not once did I catch myself thinking, Damn! If only I had known this sooner! Instead, I found myself thinking things I never thought I'd think, like, I'd rather be reading Heidegger!  It was a disturbing experience. It thickened the mystery around the question that had nagged me from the start of my business career: Why does management education exist?

We needn't follow all of Stewart's perambulations to take his point:  Much of what's taught in MBA-school is faddish at best.  Who can remember what intellectual content, if any, went into these catchphrases (just a few of those Stewart lists)?:

• Information-based organizations
• Intellectual holding companies
• Learning organizations
• Perpetually creative organizations
• R-I-P.  Rip, shred, tear, mutilate, destroy that hierarchy
• Intrapreneuring
• Integrative organizations
• Re-engineering
• Total quality management

You get the idea.

But--I hasten to add--this is damning the B-school academy for some sins of which they may not be entirely guilty, as many of these concepts have been promiscuously appropriated by best-selling authors and monetized by way of the lecture circuit.

No, I actually think there's something more interesting going on.

What I have in mind was encapsulated in a recent Harvard Business Review colloquy called "Are You Ready to Manage in an Irrational World?" 

The original article posited, among other things, that:

Have you noticed that we are being bombarded by a flood of work by neuroscientists and behavioral economists, aided by such things as clever research design, the use of improved technologies for measuring brain activity, and the admission by Alan Greenspan that markets acted in ways he had not anticipated? The work shares several common counter-intuitive conclusions that: (1) human behavior is much less rational than has been assumed, (2) this renders much of conventional teaching in fields such as economics and management obsolete, and (3) it makes suspect much of what we do as managers.

[...] because each of us harbors our own perceptions of reality, "It turns out that most of what we thought we knew about management is probably wrong." Reactions to our efforts as managers reflect what each individual receives in relation to what he or she perceives and expects. Because this is highly subjective, the argument goes, generalizations (many of them currently taught in conventional courses) about how to manage are practically useless. 

[...] Things become much more complex in the world of irrationality. Much of traditional economics becomes outmoded when complex relationships based on often counter-intuitive behaviors are taken into account. Instead of a management philosophy centered around the manager as the play-caller, assigning tasks and motivating people to carry them out, we are told by the neuroscientists that the new management job is one of facilitating more of a customized, do-it-yourself process centered around each newly-energized employee, one centered on questions (often leading) rather than direction.

Among the 97 reader comments this provoked (before they were closed) were:

 "Managers must be rational when it comes to planning, financing, operating and measuring business performance.... Irrational thinking is needed when you think about the question, 'What's next?' "

 "We've seen people and companies reject new technology [and new ideas].... Is (it) irrational ... (to) place a higher value on their current solution than they do on a future uncertain benefit(?)"

 "It (irrational behavior) makes suspect much of what we do as managers.[...] Workers will become increasingly self-managed and the manager's role will require the ability to facilitate dialogue, clarify roles and responsibilities, gain alignment, drive to consensus, and enable peer coaching and feedback." 

We have now experienced a near surfeit of books elaborating on these intellectual models which are (worthy, and highly overdue) successors to the uber-rational Homo Economicus, that utility-maximizing human calculator that was always a fiction driven by the requirements of Ph.D students in economics to provide elegant solutions to their equation-laden constructs.  Among those books are The Tipping Point, Freakonomics, Nudge, and the 4-Hour Week, and among the usual suspects in terms of authors are Malcolm Gladwell, Nassim Nicholas Taleb, Richard Thaler, Cass Sunstein, and many others.

But I would prefer to leave the last word not to those who laud business school or those who denounce it, much less to those aspiring to land at the top of best-selling business book lists, but to the famous Roman Stoic philosopher, Seneca (4 BC -- 65 AD), who, in "On the Shortness of Life," had a few things to say about how we manage our lives (ellipsis omitted).

It is a general complaint among mankind that Nature is niggardly:  our allotted span is brief, and the term granted to us flies by with such dizzy speed that all but a few exhaust it just when they are beginning to live  

It is not that we have so little time but that we lose so much.  Life is long enough and our allotted portion generous enough for our most ambitious projects if we invest it all carefully.  But when it is squandered through luxury and indifference, and spent for no good end, we realize it has gone before we were aware it was going. 

So it is:  the life we receive is not short but we make it so; we are not ill provided but use what we have wastefully.  Kingly riches are dissipated in an instant if they fall into the hands of a bad master, but even moderate wealth increases with use in the hands of a careful steward; just so does our life provide ample scope if it is well managed.

Some follow no plan consistently but are precipitated into one new scheme after another by a fickleness which is rambling and unstable and dissatisfied with itself; some have no objective at all at which to aim but are overtaken by fate as they gape and yawn.

Do you suppose I am referring to wretches whose failings are acknowledged?  Look at the men whose felicity is the cynosure of all eyes; they are smothered by their prosperity.  How many have found riches a bane!  How many have paid with blood for their eloquence and their daily straining to display their talent!   How many are deprived of liberty by a besieging mob of clients!  Run through the whole list from top to bottom:  This man wants a friend at court, that man serves his turn; this man is the defendent; that man his lawyer; and the other the judge; but no one presses his claim to himself, everyone is used up for the sake of someone else.

Perhaps to put this in more modern terms, are you as a manager--of your career, your department, your firm--living fully right-brain and left-brain? 

Have you gotten past the biz-speak lingo and are you honestly, sincerely, truthfully, engaged with what you do?  Are you, as well, thinking as but not only thinking as a lawyer?

If Seneca were to come to dinner tonight, what would you say to him?