November 19, 2020
November 19, 2020
By Rob Andrews with paraphrased content from Warren Bennis and James O’Toole in the October 2005 edition of Harvard Business Review
Fifteen years ago, Warren Bennis and James O’Toole published an article in the Harvard Business Review in which they said that business schools were on the wrong track. That they were facing intense criticism for failing to impart useful skills, failing to prepare leaders, and failing to instill norms of business etiquette and ethical behavior. They believed that was because the curriculum was the effect, not the cause, of what ails the modern B-School. Fifteen years later, we see little improvement.
Gartner conducted a study between June and August 2020, in which an overwhelming majority of 750 CHROs (68%) cited building critical skills and competencies as their number one priority in 2021. The survey found that the other top HR priorities for 2021 are organizational design and change management at 46%, current, and future leadership bench at 44%, the future of work at 32%, and employee experience at 28%. CHROs also ranked their top business-level priorities for 2021, with 65% selecting ‘improving operational excellence’. Growing the business and executing business transformations were selected by 64% and 54% of respondents, respectively. None of these objectives can take place without a skilled and engaged workforce.
Allen Austin completed a six-month-long multi-faceted study (Organizational Health Index) in November of 2020, for The McNair Center for Entrepreneurship and Free Enterprise. One of the central research questions was around how institutions of higher learning can deliver a better-prepared graduate. We engaged over 300 CHROs, CEOs, and business leaders across the country, to determine which attributes and skills were most needed in today’s business environment, the importance of each, and the degree to which today’s workers are exceeding, meeting, or falling short of the business community’s expectations.
There are Major Disconnects
Our study revealed major disconnects between what business leaders expect from college and B-School prepared workers and what they’re getting. The top ten most desirable attributes and/or skills, compared to the degree to which grads are delivering are:
The Challenges Ahead
When you combine the findings of all three studies, it spells big challenges and even bigger opportunities for leaders and organizations that can get ahead of the curve. For the last 6 ½ years, we’ve been studying organizations that perform at the very top of their sectors and building diagnostics along with developing an architecture to assist our clients in building cultures of peak performance. Our research suggests that a healthy culture of peak performance is the only sustainable competitive advantage there is, and you can’t build one without the right workforce.
Too many of today’s institutions have quietly adopted an inappropriate—and ultimately self-defeating—model of academic excellence. Instead of measuring themselves in terms of the competence of their graduates, or by how well their faculties understand important drivers of business performance, they measure themselves almost solely by the rigor of their scientific research. They have adopted a model of science that uses abstract financial and economic analysis, statistical multiple regressions, and laboratory psychology.
But business is not an academic discipline. Business is a profession, like medicine and the law, and business schools are professional schools—or should be. Today, the objective of most business schools is to conduct scientific research. We believe it is necessary to strike a new balance between scientific rigor and practical relevance.
The Problem is not Scientific Rigor but the Absence of Real-World Teaching
Rebalancing runs against the perceived self-interest of many professors, not to mention the seemingly unstoppable trend in academia toward specialization. We believe the most effective levers for overcoming this resistance are personnel policies related to recruitment, promotion, tenure, and other academic rewards. Instead of blindly following the paths forged by trade schools or traditional academic departments, business schools must create their standards of excellence. However, many business school leaders now say their universities are forcing them to adopt the same standards for hiring and promotion used by graduate departments in the hard sciences. In our view, this is often an excuse for maintaining a dysfunctional (but comfortable) system. Other professional schools have carved out standards that are appropriate for their various professions; now business programs must have the courage to do the same.
What We Can Do in the Short Term
In the short term, organizations and business leaders who aspire to build cultures of peak performance and deliver exceptional shareholder returns are simply going to have to bridge the gap. Recognizing the problem is the first step. Better screening, better training, better development, and better mentoring will go a long way. Identifying and developing high potential workers, particularly those who are reticent to self-promotion, is more critical than ever.
Over the next few weeks, we’ll dig deeper into what is needed to build cultures of peak performance. We would also love to be your thought partner and suggest solutions customized to help you achieve your business objectives in 2021.
If you would like to see a copy of our graduate study, please let me know.
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