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The recent financial meltdown is an economic tragedy that has shifted focus to the role of business schools in the world economy. Business education in the U.S. has always been under scrutiny with a study commissioned by the Ford Foundation, and the Carnegie Foundation more than half a century ago being the first in a bid to improve the system.
All over the world people are raging about big businesses: credit rating agencies, investment banks, central banks, business schools, among other economic institutions.
The resentment of business schools stems from the behavior of MBA graduates of these institutions. This behavior in turn is influenced by their academic background. Many people are of the opinion that the current economic meltdown is a direct result of management education that leads to leadership failure in a systematic manner.
The business schools train future CEOs to focus on the big picture and in the process ignores the practical details. The emphasis is not made on ethics and value based leadership. To regain public trust, business schools should direct their energies in instilling holistic approach to solving problems instead of competing for students through advertisement rankings; which implies students are only taught on making vast sums of money.
Codes of conduct should also be developed for MBA graduates with the possibility their degrees being withdrawn by a specified regulatory authority in cases of misconduct (Podolny, 2009, p. 63).
For good public image, the business schools must work on strategies to change the wanting status quo. They should offer courses which link analytical aspects to ethical values and mix academic disciplines.
Discussions should be promoted among staff from both “hard’’ and “soft’’ disciplines in coming up with the teaching materials hence qualitative research. The idea that acquiring an MBA is the key to financial prosperity should be discouraged (Podolny, 2009, p. 67).
Whenever a debate arises on the causes of the current financial crisis, opinion varies from bad regulatory authorities, non satisfactory government legislation, politicians, chief executive officers, among other groups of individuals. In the US, names such as: George Bush and Henry Paulson though politicians are just but a few most commonly associated with the crisis.
The underlying factor however is that the two are business school graduates same as former heads of Citibank, General Electric, Lehman Brothers, Goldman Sachs and other major financial institutions blamed for the meltdown.
Considering all these individuals are from the same academic background, a probe into their leadership training is in order. It would therefore be justified even if partially to attest the economic crisis to the academic systems at business schools.
Although business schools are academic institutions of higher education endeavoring to offer quality education, they are also financial empires that make vast sums of money from their activities as the income and market themselves significantly. In this regard, a tarnished name reduces their market.
Employers on the other hand are shifting to a cheaper and less risky alternative of employing trainee graduates who work their way up into management. The graduate trainees are paid less relative to the MBA holders for the same jobs.
This lowers the hopes of many MBA students who pay higher fees in the belief it would land them prestigious dream jobs. If this situation is not well checked, the demand for MBA degrees and MBA graduates would significantly go down in the coming future and by extension business schools.
Podolny, J. (2009). The Buck Stops (and Starts) at Business School. Retrieved from https://hbr.org/