A Jeffersonian Approach to the Future
The relationship between business schools and management consultants has been the topic of much discussion and research over the years; on the one hand there is a healthy symbiosis where the best of top business school graduates move smoothly into well-paid roles at top management consultancies. On the other hand, there is an increasing competition for client business around developing executives and organizational culture, and an increasingly blurred line on both sides as to where academic education and management consultancy advice cross-over.
It is therefore perhaps a little surprising, but perhaps also boldly clever, that one of the top US business schools has employed as its new dean, that is its CEO equivalent, a former senior partner of no-less a consultancy than McKinsey. Scott Beardsley was appointed Dean of Darden Graduate School of Business in August 2015, having recently left McKinsey’s as a senior partner after a 26 year career there. Beardsley’s appointment is a natural progression for him, as he had led McKinsey’s internal Leadership and Learning division and helped to launch the company’s online Academy for clients. As his CV makes clear, with an engineering degree from Tufts, and MBA from MIT and a recent doctorate from the University of Pennsylvania, all achieved with honours, Beardsley knows his way around the top providers of higher education too. So it seems bringing his insight and knowledge of the competition into the business school arena is entirely to Darden’s benefit.
Beardsley himself is modestly circumspect on the reasons he was appointed, but acknowledges that “there are actually great similarities between running an academic institution and a consultancy; the shared governance structure of a partnership and that of one with academic tenure is not that different. And there are more similarities perhaps between a consultancy partner and a senior faculty than might meet the eye at first look: they are both highly intelligent, they are quite independent, they care very much about what they are doing, they are elected through a tenure like process and they like to be involved in the decision-making….and that has been a benefit coming from a partnership to a business school as it has allowed me to figure out how decisions are made quickly, as it is kind of similar.”
The parallels run deeper than just how to manage ‘clever people’ though, as at the executive development level there is an increasing competition between these two ‘provider types’. This is particularly the case with the increasing emphasis business schools are putting on custom programs, as opposed to the open enrolment courses that were the old staple and not offered by others in the development sector at this level.
Reflecting on customising solutions Beardsley notes that while consultants typically are often sectoral specialists “academics do not particularly have to be sector specialists….”; the over-riding requirement is that the providing institution, be that a business school or consultancy, has to be able to understand the need the client is trying to solve – and critically this may require the provider to create customised solutions, and within that, customised case materials that reflect the issues of a specific sector. Beardsley sees that providers today have to be flexible with this, and able to include content already in use in client organizations, bringing that into their solutions. “That is what I think customisation is all about; working with your client to develop a set of materials that resonate with them,” he observes, with the clear implication that this is something Darden is leading at.
Darden is the business school of the prestigious University of Virginia, located at Charlottesville, Virginia some one hundred miles (160kms) south-west of Washington DC. Sometimes referred to as Mr Jefferson’s University, in honour of Thomas Jefferson, the third President of the USA, principal author of the Declaration of Independence and a co-founder of the University in 1819. The beautiful campus is famous for its Jeffersonian architecture – and is a UNESCO World Heritage site. The Darden School of Business is much more recent, founded in 1955, but still carries the aura and history of its parent. So Beardsley has some serious history to manage and reputation to foster.
He takes this in his stride, but what comes across clearly in the conversation with him is that he takes a measured, long-view approach to life. In his opening remarks to the school when he was introduced to the students he noted that “….the best leaders are balanced; they are interesting people who refresh their knowledge , they read and have other passions in life besides just grinding away at work…. They have lives worth living.”
The ‘lives worth living’ concept is weaved through much of the Darden approach. While Beardsley underlines that the school has deep knowledge and capacity across all the functional areas of a modern business school, when pressed he highlights the world-renowned Batten Institute for Entrepreneurship and Innovation, as being one of the schools strongest features – and also the focus on ethics and responsible management, particularly when allied to the cross-functional approach to management that Darden champions. “The FT has ranked us as No 1 for four years in a row for being the best ‘general management’ school, I think we are outstanding at producing CEOs and taking the top management perspective from an integrated point of view…. most issues facing organizations are cross-functional. And so how you get things done across an organization is about managing general management and leadership. How you get things accomplished across organizational boundaries and across functions is increasingly where the challenge lies. I am not saying that functional skill is not important, it surely is, …. But we are very strong on how you execute as senior leaders. Things like teamwork and ethics – things that cut across and are not purely narrow functions-matter.”
That focus on leadership is of course fundamental to most business schools, but Beardsley has a particular insight, perhaps from his consulting days, in that many organizations remain poor at recognizing their leadership weaknesses, and poorer still at addressing them. “If you were to ask many companies to explain their leadership development architecture and how it relates to their strategy, and the specific curriculum approach they take to developing leaders at each level of the organization and different functions it is often very scattered and difficult to understand and in many corporations I think there is not enough investment in it. It is defacto ‘learn on the job only’. Clearly there are companies that are great at it and put a lot of resource behind it, like GE at Crotonville and Deloitte at their US facility but there are others that when you look under the hood it is not very impressive.”
This awareness ties back into the earlier discussion on competition for executive development provision, particularly between business schools and consultancies. But Beardsley is relaxed about this – as he sees there is an abundance of need for these kinds of service. “If you look at the world and see all the capability building needs of the public sector, those needs are just so tremendous that there are going to be all kinds of ways that corporations and governments and non-profits will seek to meet those needs. Sometimes it will be a one-off process with a ‘guru’… sometimes they will say “why don’t you just take a MOOC for free”, and sometimes they will say we want a customised program and work deeply with a business school that has known our organization over a long period of time; sometimes they may want to work with a consultancy firm that has just worked with them on a strategic challenge and look to embed that capability. So I think what you are going to see is many different ways to help corporations and the public sector with capability …. The need for capability-building is growing not shrinking – and there is no single organizational type that is going to be capable of meeting everybody’s needs – it’s just not going to happen.”
Beardsley sees that business schools are going to remain very relevant in this field because it is core to what they do, “they have great professors, they know how to teach, they know how to build a curriculum… the more customised you need, the better a business school is going to be for you, because curriculum development, teaching people so they can teach others as they go along, this is the strength of a business school.”
This focus on capability-building and figuring out how to get the best performance out of your people, is, Beardsley notes, essential for any organization. “As Dean of a top business school, my goal is to help get the best out of all my people….. I believe that people perform best when they are intrinsically motivated and find noble purpose in what they are doing; just focusing on an earnings target or revenue is insufficient. …. and if that is the sole objective with no connection to any social good or something broader it can lead to high risk and people being unfulfilled in the work that they have…. Show me someone who doesn’t want their work to have any meaning whatsoever?.... People or organizations, who have little noble purposes are likely to be unsuccessful in the long-term.”
Beardsley is concerned that in a world that is evolving faster than ever, with the continual disruption of industries with new technologies, the need for innovation is greater than ever, but he thinks there is an over-emphasis on trying to solve this issue by amending corporate structures, where in fact it is corporate cultures that need addressing. “A lot of attention is devoted to structure, but what I find is that many aspects of innovation have nothing to do with structure and much more to do with culture and the way that people work together…..such as focusing on getting great talent, giving them the right sense of direction and purpose, encouraging collaboration and teamwork, ensuring that you have complementary skills, encouraging a culture where it is OK to speak up and dissent. A healthy culture is one that is willing to try new things, to be willing to pilot things and scale it up. It works ‘great’ – and if it doesn’t kill it and try something different.”
He continues “Taking no risk at all is often the greatest risk – we try at Darden to encourage people to be willing to step out of their comfort zone and to take risks. It is also the pedagogy of how we teach. The Socratic method used at Darden requires people to make decisions on their feet in real time with incomplete information. And that is a very good approximation for the real world…. The reality is that every company needs to try new things, to move forward and the need to create an environment where continuous improvement and is encouraged. And that is as much a cultural thing as an intrinsic skill capability of your people.”
Looking to the future Beardsley enumerates a list of traits he sees that the millennial generation are going to need in the decades to come. Pointing out that the Australian official retirement age is already 70, he notes that many millennials have 40 or even 45 year careers ahead of them and they are going to need to have a changing skill set across that time to be of use. Enduring traits such as engendering trust, and being an ethical leader remain at the heart of it, but the growing need not just to be able to work in teams but also to know how to work virtually is highlighted. Above all though he stresses the need for this generation to ‘know how to learn’. “Many aspects of our functional knowledge are going to need a refresh throughout our careers in our rapidly changing world. … In a world that is increasingly uncertain some of the basic things are going to matter-look at what is taking down companies today – things like ethics. How many people do you trust in your life? That is a good question that everybody should ask themselves. I think that is becoming rarer. What is becoming commoditised is generic functional knowledge, but how to apply that across functions is becoming much more valuable…. In order to do that students need to learn how to learn and retool themselves, and know how to get things done in an increasingly complex world across boundaries….. That advice is exactly what we teach at Darden: responsible management, ethics, the integration skills and the team work skills… we help people think holistically about their life and balance, while still working them very hard to achieve their full potential. I still believe hard work is a very important ingredient to success.”
I am sure that Mr Jefferson would happily agree with that.