Continuing Dialogue with the Deans
Issue date: 11/12/01 Section: Deans' Corner
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EDITOR’S NOTE--Continuing with our open dialogue between students and the administration, here are two more questions from our panel of MBAs, and responses from Dean Kreps and Dean Podolny. Panel members include: Christian Lawrence, MBA2, Daniela Ruiz, MBA2, Amanda Butcher, MBA2, Omar Gonzalez, MBA1, Christine Johnson, MBA2, and Rich Steinmeier, MBA2.
Q: An op-ed article in the previous issue of The Reporter claimed that the GSB is failing in its mission to be an international school and to teach global business. Recent Q&A's in this panel have focused on the first of these points. Do you have any perspective on the second? It does appear, for example, that cases are still stongly focused on the US. Can you outline what efforts (if any) the school is taking to include a more representative mix of international topics and cases in the program?
DK & JP: There is both a specific and a general way to respond to this question. The specific way to respond would be to talk about what the GSB is doing to bring a more global perspective to the curriculum, and we will return to such specifics near the end of the answer. However, we’d like to start at a more general level by focusing on Carlos Tramutola’s (MBA2) broad assertion that the GSB is failing in its mission to be an international school. We certainly have no doubt that the GSB can be more international. However, we are concerned about the data on which Mr. Tramutola draws to make his point. Specifically, he focuses on (1) the low percentage of non-US students in the MBA program and (2) the low percentage of cases on non-US firms. We are troubled by this for a couple of reasons. First, as we have tried to stress a number of times, while the MBA program is one of the ways in which the GSB impacts on the world of management, it is not the only way. When a book by John Roberts or Jeff Pfeffer or easily any of a dozen other faculty members gets translated into half-a-dozen languages or more, the GSB is fulfilling its mission to have an international impact on management. When Jennifer Aaker or Michael Morris conduct research on how national cultural affects attributional processes of either consumers or organizational members, the GSB is fulfilling its mission. When the roughly 60 member companies of the Global Supply Chain Forum find guidance in the writing and teaching of Jin Whang and Hau Lee, the GSB is fulfilling its mission. Similarly, when roughly 50% of the 600+ participants who come to our executive programs are from overseas, the GSB is fulfilling its mission to have an international impact on management. Finally, when our PhD students go on to conduct research and teach at business schools around the world, the GSB is fulfilling its mission. So, with respect to Mr. Tramutola’s broad assertion that the GSB is not pursuing its international mission, we would respectfully but emphatically disagree.
Having said that, we now move to what we regard as the narrower version of Mr. Tramutola’s assertion: that the MBA program could use more international content. Even in this instance, we are a little uncomfortable with equating the international applicability of the curriculum with the percent of non-US students or the percent of cases on non-US companies. A lot of material that is taught using US companies as illustrations is of relevance outside of the US. For content that is region-, country-, or culture-specific or unique to firms with global scope, we do what we can to offer electives that address these topics, and the GMP webpage is probably the best source of information on what we are offering. As you look over the webpage, it is important to underscore that the vast majority of the material for those courses was developed by GSB faculty members. That is, we do not simply reiterate others’ ideas; instead, we devote the time and effort to developing new frameworks that will be of assistance to managers operating in an international context. For example, the work of our faculty in the area of global supply chain management is simply unparalleled.
We probably could do more to increase the international content of the core curriculum, but in saying that we should do more, we do not want to lose sight of the fact that there are many who are working to get more international case material in the core. For example, in S290, faculty have – over the last several of years --written cases on companies from around the world, such as South Africa Breweries, Cemex, BP, Lion Nathan, NovoNordisk, ABB, and DaimlerChrsyler.
In our view, the most significant impediment to getting material on global business into the core curriculum is that the “big” problems of global management have proven extremely difficult to study in tractable fashion. Even simple questions like, “How long does an expat need to be in a location in order to operate effectively?” or “Under what conditions is a global matrix an effective structure?” have proven extremely vexing for researchers. To be sure, some of our sister schools have been quite comfortable developing a case study on what some high-performing global firm is doing, call it “best practice,” and then teach it to students. But how long-lived is this “best practice?” It is perhaps illustrative that ABB’s matrix was heralded as “best practice” five years ago. But today, not even ABB relies on that structure. However, we have always stressed the importance of having research foundations for what we teach, and we are not aware of a single CEO or consulting firm who can honestly tell you that they have entirely figured out any of the big organizational or human resource questions regarding how to run a global business. For this reason, the GSB is spending $1 million to fund the GLOBE (GLobal Organization of Business Enterprise) that is being conducted in collaboration with McKinsey Consulting. The faculty members involved in that study – Professor J. Baron, Hannan, Podolny, and Roberts -- will tell you this has probably been the most difficult project on which they have ever worked; it has taken two years of pretty intense collaborative work and interviewing of the leadership teams of more than a dozen multinationals to even figure out what are the right questions. However, some progress is being made, and on January 23, the GSB will be hosting an all-day conference on “Winning Globally: Organizing for Global Impact”, in which preliminary findings from that study will be discussed, and business leaders from around the world, including Lorenzo Zambrano of Cemex, Rodney Chase of British Petroleum, and Mads Ovlisen of NovoNordisk will discuss such topics as managing global growth, building global brands, and ethics in an era of globalization. Through research of this sort, we aspire to increase the international content in the curriculum in a way that is more substantive than simply counting up cases.
Q: Recruiting season, for second years at least, is upon us. It is interesting to note that, as ever, most of the on campus recruiting (at a guess, 90%) is for positions in either consulting or finance. Given that the focus of MBA courses in general and the GSB in particular is on general management, don't you think it surprising that literally only a handful of students each year graduate into hands-on management or trainee management positions? Why do you think the 'model' has evolved this way?
DK & JP: It may seem like 90%, but it isn’t. Over the past several years, investment banks and consultants have constituted between 50% and 60% of the firms recruiting on campus. (Thanks to Andy Chan for these numbers.) We don’t know the numbers for this year, but current estimates are in that ballpark, say 55% to 65%.
But supposing the figure is 60% instead of 90%, you could still ask the same questions. Why so few interviews from other sorts of firms on-campus? Why is this where our students choose to go? And is this going to affect, in the long run, our reputation as a school of general management?
The answers to the first two questions are intertwined. This is markets-in-action. To give a historical perspective, in 1975, when Kreps started here, the big-time, “that’s the job everyone (well, not everyone) wants” was a position in a Big-Eight accounting firm. Not in their consulting divisions, which weren’t much at the time, but for positions auditing other firms. All of them came to campus, they kicked off the season, and that’s when the best suits came out of the closet and tensions were highest. Today, they don’t come, and we doubt that many students would think of taking a job with the audit division of a major public accounting firm. What happened? Students began to get disinterested in jobs with these folks. So slowly, the firms found that recruiting here was less of a good way to spend their time and money. They responded by cutting back on interviews, receptions, and stuff. And as they did this, even those students who might have taken a job with one of them thought to go elsewhere. Eventually---and when it happened, it was quite a shock to the school---they simply stopped coming.
For the past decade, Stanford MBA students have not overwhelmed the Ford Motor Company or Dow Chemical or Procter and Gamble or ADM or Pacific Gas and Electric with their interest in jobs with these companies. The return for these companies to their recruiting dollar has been much higher at Kellogg, Michigan, and the like. Even supposing that the average Stanford MBA would be a “better” hire than the average grad from, say, Kellogg---and we aren’t stating this as a fact---when the odds of getting someone from Stanford are near zero, why send a recruiting team out to California (or, at least, to Stanford)? Of course, this is a vicious circle: The less these companies are a presence on campus, the less they are likely to compete effectively with the Bain’s and Goldman’s of the world. Which lowers their desire to be around.
But how did this get started? Why have Stanford MBAs taken jobs with Bain and Goldman and not with Ford and P&G? Money has played a part. The chance for rapid advancement has been important to our students. Geographical preferences (Dearborn?; Cincinnati?) have been important. And, recently, in the high-tech boom that morphed into the dot-com frenzy, all of these combined: GSB students with a true interest in general management saw start-ups as the key to riches, fast-track CEOhood, and good sushi. Only deal-making and big-time consulting seemed able to compete for your predecessors’ affections. So, not to beat around the bush, companies like Ford and P&G have decided to concentrate their recruiting elsewhere.
As long as the dot-com frenzy was alive, our reputation as a school of general management wasn’t much threatened. The percentage of students taking jobs in banking and consulting hasn’t been huge---last year’s numbers were 10% and 31%, respectively---given the large number of students who remained in California and took new-economy positions. But as the new economy slows down, unless our students can reconnect with old-economy firms outside of the financial and consulting sectors, there is a danger there.
The CMC is out working hard on the firms that have dropped us. Once again not to be coy, the message is a polite version of, “Know how you’ve always wanted to hire a Stanford MBA? This season may be the best shot you’ve had or will have for a while. Get them while they are…available.” (We’d say, “desperate,” just for the shock value, but you’d get mad at us, and rightfully so.) We are sending that message out especially strongly to people in the old economy who are in the best position to know the value of a Stanford MBA, namely our alumni. So we hope to begin to turn this around. But (a) it isn’t going to turn around on a dime. You can’t overcome decades of bad recruiting experiences with talk alone. And (b) if they come and find our students as…disinterested as in the past, they won’t be back. So please treat them with the respect they deserve.
Q: An op-ed article in the previous issue of The Reporter claimed that the GSB is failing in its mission to be an international school and to teach global business. Recent Q&A's in this panel have focused on the first of these points. Do you have any perspective on the second? It does appear, for example, that cases are still stongly focused on the US. Can you outline what efforts (if any) the school is taking to include a more representative mix of international topics and cases in the program?
DK & JP: There is both a specific and a general way to respond to this question. The specific way to respond would be to talk about what the GSB is doing to bring a more global perspective to the curriculum, and we will return to such specifics near the end of the answer. However, we’d like to start at a more general level by focusing on Carlos Tramutola’s (MBA2) broad assertion that the GSB is failing in its mission to be an international school. We certainly have no doubt that the GSB can be more international. However, we are concerned about the data on which Mr. Tramutola draws to make his point. Specifically, he focuses on (1) the low percentage of non-US students in the MBA program and (2) the low percentage of cases on non-US firms. We are troubled by this for a couple of reasons. First, as we have tried to stress a number of times, while the MBA program is one of the ways in which the GSB impacts on the world of management, it is not the only way. When a book by John Roberts or Jeff Pfeffer or easily any of a dozen other faculty members gets translated into half-a-dozen languages or more, the GSB is fulfilling its mission to have an international impact on management. When Jennifer Aaker or Michael Morris conduct research on how national cultural affects attributional processes of either consumers or organizational members, the GSB is fulfilling its mission. When the roughly 60 member companies of the Global Supply Chain Forum find guidance in the writing and teaching of Jin Whang and Hau Lee, the GSB is fulfilling its mission. Similarly, when roughly 50% of the 600+ participants who come to our executive programs are from overseas, the GSB is fulfilling its mission to have an international impact on management. Finally, when our PhD students go on to conduct research and teach at business schools around the world, the GSB is fulfilling its mission. So, with respect to Mr. Tramutola’s broad assertion that the GSB is not pursuing its international mission, we would respectfully but emphatically disagree.
Having said that, we now move to what we regard as the narrower version of Mr. Tramutola’s assertion: that the MBA program could use more international content. Even in this instance, we are a little uncomfortable with equating the international applicability of the curriculum with the percent of non-US students or the percent of cases on non-US companies. A lot of material that is taught using US companies as illustrations is of relevance outside of the US. For content that is region-, country-, or culture-specific or unique to firms with global scope, we do what we can to offer electives that address these topics, and the GMP webpage is probably the best source of information on what we are offering. As you look over the webpage, it is important to underscore that the vast majority of the material for those courses was developed by GSB faculty members. That is, we do not simply reiterate others’ ideas; instead, we devote the time and effort to developing new frameworks that will be of assistance to managers operating in an international context. For example, the work of our faculty in the area of global supply chain management is simply unparalleled.
We probably could do more to increase the international content of the core curriculum, but in saying that we should do more, we do not want to lose sight of the fact that there are many who are working to get more international case material in the core. For example, in S290, faculty have – over the last several of years --written cases on companies from around the world, such as South Africa Breweries, Cemex, BP, Lion Nathan, NovoNordisk, ABB, and DaimlerChrsyler.
In our view, the most significant impediment to getting material on global business into the core curriculum is that the “big” problems of global management have proven extremely difficult to study in tractable fashion. Even simple questions like, “How long does an expat need to be in a location in order to operate effectively?” or “Under what conditions is a global matrix an effective structure?” have proven extremely vexing for researchers. To be sure, some of our sister schools have been quite comfortable developing a case study on what some high-performing global firm is doing, call it “best practice,” and then teach it to students. But how long-lived is this “best practice?” It is perhaps illustrative that ABB’s matrix was heralded as “best practice” five years ago. But today, not even ABB relies on that structure. However, we have always stressed the importance of having research foundations for what we teach, and we are not aware of a single CEO or consulting firm who can honestly tell you that they have entirely figured out any of the big organizational or human resource questions regarding how to run a global business. For this reason, the GSB is spending $1 million to fund the GLOBE (GLobal Organization of Business Enterprise) that is being conducted in collaboration with McKinsey Consulting. The faculty members involved in that study – Professor J. Baron, Hannan, Podolny, and Roberts -- will tell you this has probably been the most difficult project on which they have ever worked; it has taken two years of pretty intense collaborative work and interviewing of the leadership teams of more than a dozen multinationals to even figure out what are the right questions. However, some progress is being made, and on January 23, the GSB will be hosting an all-day conference on “Winning Globally: Organizing for Global Impact”, in which preliminary findings from that study will be discussed, and business leaders from around the world, including Lorenzo Zambrano of Cemex, Rodney Chase of British Petroleum, and Mads Ovlisen of NovoNordisk will discuss such topics as managing global growth, building global brands, and ethics in an era of globalization. Through research of this sort, we aspire to increase the international content in the curriculum in a way that is more substantive than simply counting up cases.
Q: Recruiting season, for second years at least, is upon us. It is interesting to note that, as ever, most of the on campus recruiting (at a guess, 90%) is for positions in either consulting or finance. Given that the focus of MBA courses in general and the GSB in particular is on general management, don't you think it surprising that literally only a handful of students each year graduate into hands-on management or trainee management positions? Why do you think the 'model' has evolved this way?
DK & JP: It may seem like 90%, but it isn’t. Over the past several years, investment banks and consultants have constituted between 50% and 60% of the firms recruiting on campus. (Thanks to Andy Chan for these numbers.) We don’t know the numbers for this year, but current estimates are in that ballpark, say 55% to 65%.
But supposing the figure is 60% instead of 90%, you could still ask the same questions. Why so few interviews from other sorts of firms on-campus? Why is this where our students choose to go? And is this going to affect, in the long run, our reputation as a school of general management?
The answers to the first two questions are intertwined. This is markets-in-action. To give a historical perspective, in 1975, when Kreps started here, the big-time, “that’s the job everyone (well, not everyone) wants” was a position in a Big-Eight accounting firm. Not in their consulting divisions, which weren’t much at the time, but for positions auditing other firms. All of them came to campus, they kicked off the season, and that’s when the best suits came out of the closet and tensions were highest. Today, they don’t come, and we doubt that many students would think of taking a job with the audit division of a major public accounting firm. What happened? Students began to get disinterested in jobs with these folks. So slowly, the firms found that recruiting here was less of a good way to spend their time and money. They responded by cutting back on interviews, receptions, and stuff. And as they did this, even those students who might have taken a job with one of them thought to go elsewhere. Eventually---and when it happened, it was quite a shock to the school---they simply stopped coming.
For the past decade, Stanford MBA students have not overwhelmed the Ford Motor Company or Dow Chemical or Procter and Gamble or ADM or Pacific Gas and Electric with their interest in jobs with these companies. The return for these companies to their recruiting dollar has been much higher at Kellogg, Michigan, and the like. Even supposing that the average Stanford MBA would be a “better” hire than the average grad from, say, Kellogg---and we aren’t stating this as a fact---when the odds of getting someone from Stanford are near zero, why send a recruiting team out to California (or, at least, to Stanford)? Of course, this is a vicious circle: The less these companies are a presence on campus, the less they are likely to compete effectively with the Bain’s and Goldman’s of the world. Which lowers their desire to be around.
But how did this get started? Why have Stanford MBAs taken jobs with Bain and Goldman and not with Ford and P&G? Money has played a part. The chance for rapid advancement has been important to our students. Geographical preferences (Dearborn?; Cincinnati?) have been important. And, recently, in the high-tech boom that morphed into the dot-com frenzy, all of these combined: GSB students with a true interest in general management saw start-ups as the key to riches, fast-track CEOhood, and good sushi. Only deal-making and big-time consulting seemed able to compete for your predecessors’ affections. So, not to beat around the bush, companies like Ford and P&G have decided to concentrate their recruiting elsewhere.
As long as the dot-com frenzy was alive, our reputation as a school of general management wasn’t much threatened. The percentage of students taking jobs in banking and consulting hasn’t been huge---last year’s numbers were 10% and 31%, respectively---given the large number of students who remained in California and took new-economy positions. But as the new economy slows down, unless our students can reconnect with old-economy firms outside of the financial and consulting sectors, there is a danger there.
The CMC is out working hard on the firms that have dropped us. Once again not to be coy, the message is a polite version of, “Know how you’ve always wanted to hire a Stanford MBA? This season may be the best shot you’ve had or will have for a while. Get them while they are…available.” (We’d say, “desperate,” just for the shock value, but you’d get mad at us, and rightfully so.) We are sending that message out especially strongly to people in the old economy who are in the best position to know the value of a Stanford MBA, namely our alumni. So we hope to begin to turn this around. But (a) it isn’t going to turn around on a dime. You can’t overcome decades of bad recruiting experiences with talk alone. And (b) if they come and find our students as…disinterested as in the past, they won’t be back. So please treat them with the respect they deserve.