This was kindly sent into BizDeansTalk by Craig McAllaster, Dean, Rollins MBA.
In 1982, I published an article in a journal on the perceived value of mergers. My opinion was that few mergers and acquisitions actually provide value. Often times, the cultures are too different to fully integrate or the merger was made for the wrong reasons.
In his book, “Naked Economics,” Charles Wheelan describes what some of those reasons might be. Wheelan notes that the actions of the CEOs who run our corporations are not always in the best interests of shareholders or even employees. Wheelan says: “They may steal from the cash register figuratively by showering themselves with private jets and country club memberships. Or they may make strategic decisions from which they benefit but shareholders do not.” Wheelan notes that two thirds of all corporate mergers do not “add value to the merged firms” and one-third are “worse off.”
In the past year, we’ve witnessed firsthand the results of decisions made by senior executives to advance their own aspirations and, often times, wallets. I’m talking about those mortgage-backed securities that turned a quick profit for many on Wall Street and which have played a major role in this bitter recession.
At the AACSB International Conference & Annual Meeting in Orlando this year, I moderated a panel called “Are Business Schools Responsible for the Current Economic Crisis?” In it, we discussed whether the current meltdown in the markets, the credit crisis, bonuses for executives in companies going out of business and/or receiving government bailouts are signs that business schools are not doing enough to instill ethics and values.
Specifically, as business school deans, we need to examine what role our institutions have played in shaping the attitudes that influenced this crisis and possibly revisit what it means to be a successful graduate.
We need to reexamine how we teach ethics, culture and value to our students. And we need to make sure that ethics and culture are instilled in our students not just during down times, but all of the time. We also need to help our students understand that the value of an MBA is not just a function of cost and ROI, but it’s also based on the ability to act ethically and with the best interest of organizations, shareholders and employees.
As the timetable for an economic recovery remains unclear, one thing is certain: far greater accountability will be required of our leaders. I can’t think of anything that would be more detrimental to the reputation of a company than a senior executive who puts his/her interests before those of customers or shareholders. As we move forward in this economy, on thing that is certain: the MBA must also advance with ethics as a strong and driving force.
I agree, and believe that MBA education should be a "wholistic" enterprise in which students are taught all the necessary concepts, stategies and formulas to effectively execute organizational job functions at a higher level of proficiency and comprehension than their non-MBA peers AND where they sharpen their human skills of appreciating values in a business context, seeing the big picture from an ethical as well as bottom line-fashion and knowing that leadership is a "we" rather than "me" endeavor. Well and timely stated article.
Posted by: Susan A. Bach | Friday, 03 July 2009 at 01:22 AM