The New MBA-A Journey Just Begun

George W. Hettenhouse

S cenario: The day is August 25, 1997, the auditorium is full of 280 fresh faces ready to begin a two-year MBA journey. As aca-

demic head of the MBA program, it is my respon- sibility in this session to focus their attention on their goals and objectives for the next two years. My t’irst PowerPoint slide clicks onto the screen:

IVhy m-e you here? An MBA is not necessa y.

After their initial shock wears off, I lead students to the conclusion that the degree itself is rela- tively meaningless; what is important is that these young people take this two-year period to build the requisite knowledge and skills to differentiate themselves from others in the organizations they will join 10 begin their new careers.

Just as entering MBA students face a sizable challenge in their program, so do MBA faculty and administrators face the challenge of adapting the degree to the rapidly changing business world and the extraordinary expectations now present in the firms that will hire the students. Much of Professor Hancock’s preceding article has a familiar ring, but much, I feel, is institution- ally unique. Generic MBA programs are rapidly being replaced by programs of mass customiza- tion aimed at a specific market niche.

MBA programs began their change process in the early 199Os, driven by some rather blunt feed- back from the business community. Picking on higher education is a surefire way to sell maga- zines and newspapers, so there was no shortage of publicity for the concerns and misgivings in the business world. Indeed, it was time for a change. The analytical skills focus that had domi- nated graduate business education in the 1970s and ’80s had lived its useful life. Business organi- zatic jns were undergoing tremendous changes in size and operations, as the functional silos of the past were torn down and replaced by team-based collaborative structures.

The Consequences of Change

Those who have led a If may be a bumpy change process in their companies will readily

ride, but the results agree that there are three are worth it! outcomes to change: I I

1. the desired out- come that motivated the change in the first place;

2. unanticipated consequences that interfere with the achievement of desired goals; and

3. mistakes that, with the benefit of hindsight, appear to be fairly stupid.

Professor Hancock candidly describes the change experience at the University of Louisville. Similarly, the faculty at Indiana University’s Kelley School of Business have experienced all three of these outcomes. What is interesting, however, is that the list of what works and what doesn’t tends to differ across universities, reflecting the market niche of the students, the degree of fac- ulty commitment, and the structure of the new curriculum. In sharing some of our experiences and commenting on how they differ from those at Louisville, I hope to broaden the perspective on the issues Professor Hancock raises.

The Kelley MBA

At Indiana, we serve a clientele of experienced students. Our class is drawn from a worldwide market (about 40 percent from the Midwest), has an average age of about 28 years, and boasts an average of about four years of full-time work experience. CPAs, engineers, business managers, and those with no business experience (affection- ately called “poets”) make up the class. Our stu- dents commit to two years of full-time residential study; the program is designed to use up almost all of their time during the academic year. Such a degree of student commitment permits us to de-

The Yew MBA-A Journey Just Begun 45

sign curricular activities with little regard for other things that are happening in their lives.

Our two-year program is designed around three integrated cores as follows:

1. Foundution Core (7 5 credit hours, semes- ter one): Critical Thinking, Financial Accounting, Human Resources Management, Managerial Eco- nomics, Organizationa Behavior and Manage- ment, Quantitative Methods, and Strategy.

2. Functional Cow (15 credit hours, semester two): Financial Management, Information Sys- tems, Managerial Accounting, Marketing Manage- ment, and Operations Management.

3. P&y Cow (7.5 credit hours, semester three): Dusiness Law, Business Ethics, and Macro- economics.

Each of the core experiences is taught by a team of faculty members who collaborate to teach

the principles of _ their disciplines,

‘The success of the fuc#~ty work out the over- laps among disci-

team depends entirely on plines, and assist

how committed members students in building their personal skills.

are to ~a~ici~uting in the Students are as-

experience and subve~ing signed to four-per- son. semester--long

their own goals to those of teams, constructed

the team. ” to reflect the diver- sity of academic

I background and experience. Each team includes a student from outside the United States to give the teams a diverse cultural dimension as well.

In the second year, students pursue elective courses to fulfill 12 credit hour majors and six credit hour minors. These courses are more tightly focused on the needs of particular disci- plines and are intended to prepare students for the responsibilities in their first assignments.

Based on our experiences here at the KelIey School, and comparing them with those of other MBA programs, several “lessons” can be offered concerning the new MBA.

Lesson #l: The program design for the new MBA must reflect the attributes and homoge- neity of the market niche served.

One of the important insights from Professor Hancock’s article is the reminder of how inflex- ible the new MBA can be when it comes to part- time students. The Indiana version requires that students have experience and that they be at- tending school full-time. The structure and deliv- ery of ihe program would be inappropriate for a part-time student niche or for a niche comprised of students with less work experience or a greater degree of heterogeneity. Indeed, as Hancock

46

suggests, the challenges faced by part-time pro- grams are quite substantial. With fewer courses per semester, a full-time job to occupy most of their attention, and the constant threat of refoca- tion, the program designed for these clientele must be substantially different. Similarly, when the student clientele are younger and less experi- enced, as is the case in our accounting MBA, the approach must be more similar to the traditiona! academic model and less reminiscent of the ex- ecutive education model we currently employ in our full-time program.

Lesson #2: The faculty are a key element in the new MBA program success.

When I travel to conferences of MBA leaders and discuss common experiences with colleagues, it becomes clear that the commitment of the faculty is essential to the successful itnplel~lentati~~n and ~nanagement of a new program. Hut ~iltho~lgh this may seem obvious, there is still no common model in use around the country and little in the way of common experiences to report.

Some schools fc>llow the dominant-leader, docile-follower rrwclel and are encountering the predictable issues of sLls~inal~i]ity as the dcttni- nant leader loses interest or the docile foliowers are replaced by faculty with new ideas. Other schools follow the model of pairing the faculty ancl sending them to offer a jointly taught inte- grated class. As Hancock suggests, the cost of this approach is high and the novelty tends to wear off over time. Our own limited exptlriencc with this model also suggests that some classes consist more of debates between the two filculty men- bers than of productive learning experiences for the students.

The third model-the one we have adopted at ILJ-involves the faculty in nlLlIti~le-person teams to design the integrated core using both individual and collaborative processes. Although this model has served us well, we have struggled with the process of introducing new members to intact faculty teams as normal faculty turnover shifts team mem~?ership.

The success of the faculty team depends entirely on how committed members arc to par- ticipating in the experience and subverting their own goals to those of the team. Although I won’t be so bold as to suggest that we have no pro)- lems in our process, I am proud nf the collabora- tive work the faculty teams have done over the six years this design has been in pl~e at IIJ.

Lesson #3: It’s not about integration, it’s about coordination and integration.

Much of what the new MBA programs do under the rubric of integration is really more accurately

categorized as coordination. When faculty work together, they discover common themes and foci in their work. Often a minor rearrangement or a shared case can give the curriculum the appear- ance of tight integration, when in fact the break- through is nothing more than the coordination of materials that results from improved communica- tion among faculty members. Integration does occur as well, but our experience shows that it is best done at the intersections of the disciplines- playing a management simulation game, student presentations of multidisciplinary cases before the faculry at large, or independent student research on general management topics.

hlake no mistake about it-this process of collaboration and coordination is time-consuming. Our c.ore faculty receive nine credit hours of teaching credit for instructing the equivalent of six cl-edits in the core. Though initially believed to be generous, with core class sizes averaging 65

to 75 classes we find that this “market price” bar&q clears the market. New MBA curricula are

time-l:onsuming; our preference is to spend the time :n the design and coordination phase rather than ,laving two faculty members sit together in the classroom.

Lesson #4: Managing students in teams is more complex than managing students as individuals.

At the Kelley School, we make extensive use of team>,. The team members are expected to sup- port the other members; the CPAs help the “po- ets” in accounting, the engineers help everyone in statistics, and so on. The teams carry out a variety of team projects, thereby permitting the faculty to assign a richer mix of projects than if they were done individually. Indeed, we have even experimented with team-based examina- tions: members pick up the marketing midterm at 8:00 a.m. and turn in a word-processed, Excel- analyzed solution by 5:OO p.m.

\‘5th the positive experiences of teams also come the unanticipated consequences and prob- lems. Our experience here is not unlike that at the University of Louisville. If the student teams feel tlley are overworked, the work tends to be divided up in a manner to facilitate its comple- tion rather than to facilitate learning. If one team memljer decides he is “too busy,” there is always a temptation to become a “free rider.” If another student is an incurable type A personality, there is a tendency for her to want to work indepen- dentI> and(‘or dominate the projects. Such behav- iors, (If course, are not unique to the academic environment; we could find plenty of examples of the same behaviors in organizations that rely on team-based management processes in the work environment.

The New MBA-A Journey Just Rqun

Solving the Problems

We have learned a lot from our experiences over the years with teams and are slowly but surely reducing the severity of some of the problems. A few of our conclusions are as follows:

l Working on teams is a learned skill. We continue to experiment with experiential instruc- tion in the areas of teamwork and team develop- ment, improving the skills and understanding of our students to work in team-based environments.

l Student collaboration on teams is enhanced by the nature of the assignment. We have learned that team assignments of a technical nature (such as building a computer model) tend to get del- egated more often than assignments of a broad and general nature. Hence, we have become attentive to the nature of assignments we design.

l Peer feedback processes on teams are CTU- cial to their success. Although we certainly do not have this completely figured out, we are learning just how important such feedback is. We focus on two types. The first teaches and encour- ages students to give feedback to one another on team processes and functioning independent of the faculty member; in other words, there is no grading element involved. Second, we debrief the teams at the end of each semester to learn the relative contribution of each member to team assignments. Based on the feedback the faculty receive, we search for outliers, both positive and negative. When there is a consensus that a mem- ber of the team has made an unusually positive contribution, we seek to give this student the benefit of a higher grade. When the team consen- sus indicates that a certain member is a free rider, we give less credit to that individual for team- based assign- ments. Indeed, over our six-year experience we have dismissed several students from the program based on their total perfor- mance, an impor- tant part of which is their citizen- ship in a team

“I would7 ‘t want someone with these behaviors on my work team; consequently, I

don ‘t want this same person carrying the imprimatur of an IU MBA, ‘I

environment. Our philosophy is simple: I wouldn’t want someone with these behaviors on my work team; consequently, I don’t want this same person carrying the imprimatur of an IU MBA.

The feedback from employers indicates that our students are indeed well prepared to work in team-based environments. This confirms our understanding that team processes are a skill to be understood and learned, mostly in an experi-

47

ential environment. Indeed, some of the best learning takes place when a team has a low per- former or a free rider. Teams that solve such problems and establish themselves as high per- formers learn valuable lessons for work and life.

To be sure, there are some unintended con- sequences of team behavior. Weak students on a strong team can perform at a level beyond their own capabilities. The reverse can also happen. Hancock’s observations are instructive in this regard. When the MBA program has the add- tional responsibility of certifying the student as suitable for graduation, team-based assignments can muddy the evaluation. Schools like Indiana, which have very selective admission processes, have a lighter burden in this regard. Companies sometimes joke that they would just like to buy our list of admitted students and hire them right away rather than waiting for two years to see them in the interviews. The student niche served does indeed influence the design and structure of a program.

Another nagging problem with the team- based design is the carryover of the culture into the interview process. Companies expect stu- dents, particularly MBA students, to sell them- selves aggressively in interviews. But our stC1- dents, used to working in team environments, use the “we” and “our” pronouns rather than “I” and “my.” This frustrates recruiters as they ask students to demonstrate where they have shown leadership or problem-solving skills. It is startling to listen to recruiters’ feedback that MBA students are not aggressive and selfish enough. Perhaps the “greed is good” genemtion is no longer com- ing to business school.

A s this brief summary and Professor Hancock’s article illustrate, the new MBA curricula do constitute a new para-

digm. The challenges for students, faculty, and

administrators are substantially greater than in the past. Perhaps I am just an optimist by nature, but I see this as a journey just begun. There is no question but that the academic processes are better than in the past. The coordinated and inte- grated approach is clearly the way to go. What is not so clear at the moment is how to get there. Like the pioneers who crossed the United States in covered wagons, the journey can be long and painful. Most faculty who have experienced the new world see its potential.

Faculty frustration can erupt over the ineffi- ciencies and costs of this new approach. I3ut like any process of change and experimentation, WC’ have yet. to realize much of the learning curve benefits. Nor have we yet developed much in the way of collaborative cases and simulations to facilitate the process. With time, these improve- ments will appear, just as the interstate highway systetn is now built over the ruts left by the wag- ons of the pioneers. Faculty at a variety of schools will continue to travel the road IXXII_IS~ that is where the new market for MDA education is headed. In the American tradition, there will not be a single design that will predominate. Rather, there will be a multiplicity of designs that reflect the student clientele served as well as the coni- mitment and ambition of the faculty. This is an exciting time to be involved in MBA education, to participate in this journey just beginning. 0

George W. Hettenhouse is the chairman of the MBA Program and a professor of finance at the Kelley School of Business, Indiana University, Bloomington, Indiana.