Bill Boulding is optimistic about the future of leadership and the contribution business schools can make to developing better leaders for the future. But he is also very realistic about the crisis we are in and about the past failings of the business school educational model.
He points to a glaring irony; at the very time business leaders need to step up and provide solutions to the world’s economic and social problems – low growth, climate change, damaged environments, poverty, universal access to healthcare and education – they have suffered a catastrophic collapse in public trust.
Public trust in politicians is notoriously volatile but the multiple corporate scandals of the past few years have brought unprecedented distrust for business leaders too.
Boulding believes there is a leadership deficit facing the world which has led to gridlock in economics, governments and corporations, and brought us the Eurozone crisis, the ‘fiscal cliff’ debacle, and a multitude of corporate disasters.
Taking the standpoint that it is only the global business community that can begin to offer solutions to the world’s problems, the Dean’s optimism stems from two important observations:
First he contends that the decade’s leadership failings are not due to people being intrinsically less ethical than in the past, as has sometimes been suggested, or that this generation has just thrown up an unusually poor set of leaders. Rather they are because we have failed to prepare leaders to deal with our increasingly complex, fast-changing, disrupted world and the new ways of doing business that have grown up rapidly over the past few years.
Secondly he is optimistic because he sees that we are now beginning to understand the skills leaders need to operate effectively in today’s world. Business schools, which now acknowledge their responsibility for past failings and for hanging on to the traditional MBA model for too long, are breeding a new generation of prepared leaders. Leaders who now have the mindset fit to face the future.
If the current leadership crisis is not simply due to moral decline or a poor crop of leaders, but is due to our being overwhelmed by huge disruptive changes that leaders have been unprepared for; then by preparing future leaders properly the problem can be fixed.
To make this fix business schools must innovate and evolve to be able to develop a new leadership model. But first we need to fully understand the dynamics at play behind the changes that have overtaken the business world.
To understand these dynamics Boulding identifies three major forces of change:
We live in an irrevocably global world, but have not really begun to appreciate what this means. For years business leaders have assumed globalization would be about the convergence of the developing world with the traditional US centric model. Clearly this has not happened. Rather, due to the fundamental differences in outlook, institutions, behaviour and the residue of history, convergence is not happening. This has lead inevitably to negative reactions of annoyance, fear, and disengagement. The current reality of globalization is that people are not finding common ground and thus huge opportunities for growth are being lost.
The ripple effects from a tsunami in Japan has changed the way the world views nuclear power; the Arab spring, the Brazilian rain forest, the emergence of a shale oil gas industry, and the crisis in the Eurozone all resonate around the globe.
We live in an interdependent world and the unspoken downside to this is that interdependence means a loss of control. The action or inaction of others can profoundly affect our own endeavours in a far more profound way than previously. Faced by loss, leaders try to reassert control. Companies, politicians and interest groups fight to protect and control their territory, which inevitably gives rise to stress, uncooperative behaviour, polarization and extremism.
Extreme positions are taken leading to a loss of trust, non-collaboration and lost opportunities. The GM food and shale oil gas lobbies sees no negatives while environmentalists speak of genetic mutation, earthquakes and worse. In financial markets, where the allocation of capital to drive growth is so essential, a collapse in trust exacerbated by scared regulators and ‘Occupy Wall Street’ activists has led to inertia and a decade of lost opportunities.
The combination of globalization and interdependence with the rapid spread of radical new technologies has led to widespread disruption to the way we do business, to our institutions and economies, and to our understanding of leadership.
Dean Boulding believes that, rather than countering these three forces, we should harness them. We must see the positive side of disruption, and 21st century leaders must learn to look out for a much broader set of stakeholders than has traditionally been their habit. Modern leaders need ambition but only when combined with humility and a desire to serve a broad constituency. They should embrace positive disruption by seeking to collaborate with others with diverse outlooks and ideas and to seek common ground to leverage creativity and innovation and ultimately to meet opportunities to deliver products, services, and solutions for a better world.
The disruption caused by the 2008 financial meltdown, the subsequent broken contract between Wall Street and Main Street, and global economic stagnation can be seen as a transition point; a point from which business leaders, with a renewed sense of purpose, authentic engagement and a desire to make a difference, can tackle the many challenges facing the world. Rebuilding our damaged financial industry, developing clean technologies to reduce climate change, spreading access to affordable quality heath care, solving water and food shortages, and alleviating poverty are huge challenges that offer endless opportunities for leaders and their organizations to do good and to make good profits.
Addressing the question – how can business schools bring about the change needed for leaders to operate effectively in today’s complex and disrupted business world? Dean Boulding cites the approach taken at his own school.
Duke University, the youngest of the USA’s leading research universities, is situated at Durham, North Carolina, a vibrant city, but hardly a global commercial hub. Duke’s Fuqua School Business School, founded in 1969, took an early decision that to educate business leaders in a rapidly ‘globalizing’ world, it needed itself to go out into the world, appreciating that it was not credible to understand global variability from a single site. A pioneer in working internationally, Fuqua was even educating Soviet plant managers in the days of the old Soviet Union. Following up on this long time strategy the school decided five years ago to cement its position by putting people on the ground and opening offices in Dubai, London, New Delhi, St Petersburg and Shanghai. The deeper understanding provided by this exposure to local context across the globe provides Fuqua with an enormous advantage as a precursor to developing the insights, research and thought leadership that underpins its executive development programs.
The other distinctive approach championed by Fuqua School of Business is in its thinking about people. In the people it employs and the executives it encourages to join its programs, the school looks for a balance of quantitative intelligence and emotional intelligence and strong core values around the leadership role. Central to these values is ‘co-creation through co-operation’ with others and the concept of ‘collaborative diversity’. Fuqua believes that too much time has been lost due to the friction caused by barriers, both interpersonal and cultural, between people and that the leader of the future must be both a good guest and a good host, moving easily between environments and celebrating diversity. Increasingly, the executives Fuqua engages with have identified the importance of these values, and see the need to take responsibility for co-creation and to instil it in their organizations.
Finally Dean Boulding touches on methodology – how Fuqua prepares leaders to be fit for the future. The transformational experience offered at Fuqua puts people under pressure forcing them to truly find their passion in what they do. A passion found under pressure that they will easily transfer to their working life. Because many new ideas around leadership involve allowing leaders time to assess strategies and reflect on challenges, some sceptics have suggested that in the reality of the day-to-day business world this is not possible. By putting program participants under real pressure, Fuqua ensures a seamless transfer back to the day-to-day with the new knowledge and outlook intact and in use. Quoting Tim Cook, Apple’s CEO and a Fuqua graduate, the hardest thing he found about this approach was learning how to juggle and find time to do the truly important things, a skill he subsequently found invaluable.
Another way the school goes about preparing leaders comes from Fuqua’s experience of online learning. The schools pioneering Global Executive MBA program adopted a ‘place and space’ model in 1995 combining distance learning with physical, face-to-face meetings. This experience born from the school’s long-time commitment to operating in a global environment with distributed teams, positions it well to take advantage of the potential for online learning presented by advancing web-based technologies.
However, Boulding is firmly of the view that blended learning - ‘flipping the classroom’ by combining face-to-face learning with online components is the way forward. Fuqua faculty have been involved in MOOCs (massive open online courses) but not only is the business model for such courses unproven; they have as yet neither addressed issues relating to cultural diversity nor the indefinable unpredictable emotional aspects of learning triggered by face-to-face interaction.
Bill Boulding’s optimism about the future of leadership, the contribution business schools can make, and Fuqua’s own ability to prepare future leaders who can make a truly positive difference in the world is infectious. It is also convincing because it is so obviously clear-sighted and well considered and is based on real long-term experience with leaders past and present who have been struggling in a dramatically disrupted business environment.