Send in the Clowns?

Remember when a trillion dollars was a lot of money? Well now you can also reminisce about when a Harvard MBA was a ticket to upper class respectability. In the Times today, Philip Delves Broughton, himself an alumni, provides an irreverent but nonetheless damning assessment of failures attributable to his fellow graduates. A particularly egregious example is the schools intense focus on the Royal Bank of Scotland, now a ward of the state, as a paragon of management virtue. Key quote:

When I was a student at Harvard Business School, between 2004 and 2006, I recall a distinguished professor of organisational behaviour, Joel Podolny, telling us proudly of his work with Fred Goodwin at RBS. At the time, RBS looked like a corporate supermodel and Podolny was keen to trumpet his role in its transformation.

As we now know, however, the reality was quite different

Every trendy business school idea was being implemented, it seemed, while what really mattered – the bank’s risk assessment, cash flow and capital structure – was going to hell. To be fair, neither Podolny nor the authors of the case studies were finance professors, but it’s still pretty shocking that a school that purports to teach general management should fail to see the gaping problems at a firm they studied in such depth.

I have thought for years that many graduate professional programs (I hold an MPA) are finishing schools more concerned with imbuing graduates with the poise, confidence and the accoutrements of image as much as a solid foundation of knowledge and skills. The result is all too often arrogance unsupported by ability. In the current financial disaster, the results speak for themselves.