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Business schools must innovate, too.

Business Schools Must Innovate, Too

An American MBA student takes a year off to work as chief consultant to Moscow's fledgling commodities exchange; U.S. business students and faculty advise governments and companies in Eastern Europe on strategies for privatization; a group of Wharton management and finance professors teach Chinese executives in Shanghai; Japanese and American MBA students consult jointly with U.S. companies on accessing Asian markets; business school graduates spend their summer teaching management and marketing courses to Soviet executives in Leningrad and Vilnius; a group of MBA student volunteers help rebuild the economy of hurricane-ravaged St. Croix. This is just a sampling of news bulletins over the past 18 months describing the involvement of MBA students and business school faculty in current issues and events around the world.

Globalization is clearly the most far-reaching and profound change factor facing business and business schools today and in the future. It is fundamentally reshaping markets and competitive forces and demanding changes in the way managers think and work. In direct response to today's global marketplace, students and faculty from top business schools in the U.S. are literally spanning the globe to develop and apply their skills.

To prepare students for this globalized environment, all management education must be global. It must help graduates to lead organizations that span many different nations, to manage increasingly diverse and inter-related work forces, to develop strategies for global sourcing and marketing, and to approach every aspect of the business with a global perspective.

For the past few decades, and particularly the last 10 years, management educators have been carefully studying this evolving global marketplace and bringing results into the classroom. But we still have a long way to go, and the phenomenon of business globalization is still developing rapidly.

The leading U.S. business schools already have become international. One contributing factor has been an increasingly international student body and faculty. At Wharton, for example, MBA applications from international students are up 108% since 1985 and international students from 60 nations now make up 29% of the entering class. The increase in international students, which we have encouraged, ensures a very global diversity of perspectives in classroom discussions, in small groups, and in informal interaction. This diversity is also evident in Wharton's faculty - more than 20% come from 14 different countries of origin.

There is also a growing demand for international employment of new MBAs. For example, in Wharton's graduating MBA class of 1991, 45% accepted positions with distinct international responsibilities - up from 36% the prior year. And of the 22% in Wharton's graduating class of '91 who accepted initial positions based overseas, 26% of those were U.S. citizens - up from 20% in 1987. Clearly, the market is demanding more managers who think and act internationally and who possess the skills to operate effectively in this globalized business environment.

In order to meet this demand, many schools have been aggressively pursuing a variety of programs and innovations to instill a global mind-set in every MBA who graduates. These include dual-degree programs, major new developments in MBA curricula, foreign language programs, international study tours, global business games, summer internships, and partnership arrangements between business schools in the U.S. and those in Europe and Asia.

Dual-degree programs, which provide intensive immersion in the study of business and culture, are an example of business school leadership in this area. In our Lauder Institute program, for example, 105 students now work and study overseas, graduating with both a Wharton MBA and a master's degree in international relations from the School of Arts & Sciences, having obtained a strong grounding in language and international politics, culture, and economics.

Such pioneering programs have provided a global experience base for the revolutionary developments of MBA curricula now under way at a number of leading schools. Wharton's new MBA curriculum is one example. While in the past, students may have elected to take specific international courses, Wharton's new MBA program provides a global orientation in every core business course - from marketing and management to operations and accounting. In addition, a new course on geopolitics helps students understand the global environment in which they will conduct business. Further, a semester-long global "business game" exercises the practical use of competitive strategies in a global marketplace. Also, a month-long international study tour provides students with direct business and cultural study and experience in Europe and Asia.

Understanding different languages and cultures is becoming increasingly important to managers of the future. Wharton now offers a number of heavily subscribed new language programs, including courses in "business" Chinese, Dutch, French, German, Japanese, Portuguese, Russian, and Spanish; seminars on interviewing in a foreign language; and even some core business courses, such as marketing, taught in both French and Spanish.

Perhaps the most significant development in Wharton's new MBA curriculum is an emphasis on integrative management and leadership skills. Clearly, the successful global manager of the future will require the ability to draw together and lead across diverse national employee groups, functions, and cultures in building a coherent organization with a powerful common mission.

Of course, a global perspective in the classroom begins with a faculty that is directly involved in studying and making an impact on the critical issues in the global marketplace. While cross-national studies, for example, are complex to design and implement, advances in technology and the "globalization of information" have made it easier to collaborate with researchers in other countries and to analyze business data from around the world.

Wharton and other leading schools of management are increasingly establishing distinctively international research centers, where faculty focus on studying such issues as the forces of global competitive advantage, cross-cultural differences in entrepreneurship, international manufacturing strategy, global financial systems, cross-cultural ethics, and global brand marketing.

Also, governments and businesses around the world often turn to U.S. business school faculty for advice on reshaping their economies, spurring privatization, or encouraging entrepreneurship - thus further broadening our faculty's experience and knowledge base.

Certainly, the fast pace of change in world business has meant increased global demand for continuing education. For example, international participation in our executive education programs has now grown to more than 40% of the attendees.

Besides growth in international participation, there has been an increase in the global content of these executive programs. Wharton's International Forum, for example, brings together senior corporate executives and distinguished leaders from industry, government, science, and the arts three times a year - in Europe, Asia, and North America - for an intense exploration of global strategic issues.

As the content of management education has become increasingly global, so has the delivery. What began as a handful of business schools in the U.S. has been transformed into a rapidly growing global industry. Last year, some 820 business schools around the world awarded 85,000 MBAs - 700 of those business schools were in the U.S., awarding 75,000, or 88%, of all MBA degrees.

While the phenomenal growth in management education in the U.S. may not continue at the same dramatic levels, Europe and Asia are rapidly expanding their own delivery of the MBA program. The number of MBAs produced each year in Europe is expected to double during the 1990s, and both Oxford and Campbridge universities have announced plans to offer MBA programs for the first time. Leading Japanese universities are also launching MBA programs.

While these new developing schools in other areas of the world are welcome for the diversity that they will ultimately offer, many are currently at a necessarily limited state of development. For example, while schools in these regions may appear to be globally oriented because of their locations in Paris, London, or Tokyo, many are, in fact, in the early process of confronting their own strong national and regional biases and limitations - the same issues that U.S. schools began to address seriously in the 1970s.

Because of this much earliest start, leading U.S. schools have developed broader research and teaching programs that continue to lead their international counterparts in reflecting a global business view across the entire world of East Asia, North and South America, and Europe. And U.S. business schools possess enormous competitive advantages in scale, depth, and breadth that will enable them to continue to lead significantly in the global delivery of management education.

Not the least of these advantages is a dominant U.S. base of highly experienced faculty. Competent business school faculty have become one of the scarcest resources in the delivery of management education worldwide. This limitation has, for example, led many European schools to construct MBA programs that are only one year in length, with even that reduced program delivered through the support of a substantial complement of visiting faculty from U.S. business schools.

Nonetheless, U.S. business schools cannot afford to rest on their laurels, for we live in an age of change, in which one's leadership position must be managed aggressively and strategically if it is to be maintained. Thus, this new context of global business education requires that we who deliver management education, like our students and graduates, must also operate with a global strategy. As a result, Wharton has taken further steps to globalize its business - such as establishing full-time, overseas offices in Tokyo and Paris and creating international advisory boards of senior executives in both Europe and Asia.

In this fast-changing world of business globalization, there is still much work ahead of us. We continue to push "the edge of the envelope" of performance as we must prepare students to operate effectively in globally varied economic and political conditions and give them the tools and perspectives they need to manage continual change and diversity.

We in management are committed to meeting this challenge to prepare our graduates for the opportunities of the next millennium - i.e., to adapt and succeed in an increasingly complex and rapidly changing global business environment.

As corporations must be globally competitive to secure their own futures, so, too, must business schools. Thomas P. Gerrity, Dean of the Wharton School of the University of Pennsylvania, presents a look at how business schools are adapting and innovating in order to accomplish their vital mission of educating the new generation of global executives. Gerrity is a Rhodes Scholar who spent 20 years consulting with senior executives in the U.S. and Europe on the strategic role of information technology. In 1990 he became the 11th Dean of Wharton, the nation's oldest collegiate school of management.
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No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991 Gale, Cengage Learning. All rights reserved.

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Title Annotation:Special Section: Being a Global Leader; views of Thomas P. Gerrity, Dean of the Wharton School of the University of Pennsylvania
Publication:Directors & Boards
Date:Sep 22, 1991
Previous Article:Creativity and global service.
Next Article:The ethnocentric approach is out.

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