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Category: Z General – Business Schools

General – Business Schools

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Co-designing education with industry to meet the challenges of the future

Business Impact: Co-designing education with industry to meet the challenges of the future

At Macquarie Business School, the emphasis is on making business education truly relevant to industry, government and future society, explains Eric Knight, Executive Dean and Professor of Strategic Management. Interview by David Woods-Hale

In 2021, Macquarie Business School at Macquarie University in Sydney, became one of four Schools in Australia to be accredited by BGA’s sister organisation, AMBA.  

The School, which was established in 2019 and is the single point of delivery for all business, management and economics teaching and research activities at Macquarie University. Its Global MBA programme was launched in response to the changing demands of the global MBA market and draws upon new learning technology. As such, the School is known among employers and students as the place to be for real-world application and employer-relevant skills. 

In this interview, Macquarie Business School’s Executive Dean, Eric Knight, discusses the innovation and achievements of the School, its plans for the future, as well as his own thoughts on the economic climate and opportunities for business education.  

What are the biggest challenges facing Business Schools?

Business Schools will be impacted by the changes in the global economy and global/local jobs markets. In that respect, the kinds of challenges facing businesses map against those of international Business Schools as they tailor their offerings to where students need skills. It is important that Business Schools can respond to the challenges to ensure the next generation of business leaders can manage through these changing times. 

The employment skills required for professional success are changing: effective communication, data analytics, critical thinking, and problem solving are all now valued. That is why we devised our Global MBA, in partnership with Coursera, around a set of skills rather than traditional disciplinary domains. That programme has proved very popular and has just been ranked second in Australia and 19th globally by QS in the 2021 Global Online MBA Rankings, after launching in 2019. It is also ranked first in the world for ‘class experience’.

The nature of learning is also changing, and it is now essential that Business Schools provide a quality online experience for all students. Students are also looking for shorter learning experiences and life-long learning opportunities that allow them to build successful careers. Macquarie Business School is responding to the challenges with courses that are co-designed with industry to help students get the very best education they can. 

For example, our partnership with the Australian Financial Markets Association offers micro-credentials that feed into our master’s of applied finance programme. With workplaces and the future of work evolving so rapidly, careers options for our students are very different to just five or 10 years ago. This is our great responsibility and privilege – to help students find their way into the world.

What do you think differentiates the MBA at Macquarie Business School?

Quality. We have a solid foundation of high-quality teaching and research and our long-term vision is to focus on relevance in the world and to industry and government, for whom we prepare the future workforce.

Our MBA provides a transformative learning experience, building strategic business acumen and leadership capability to accelerate career progress within or across industry. It is tailored to student learning, work and career needs by addressing: 

• Essential and contemporary business discipline knowledge and skills. 

• The integrated application of business disciplines in key units, culminating in the MBA capstone unit.

• Business disciplines in practice via the Industry and Alumni Partnership Program integrated in the curriculum.

• Business disciplines applied to student work and career needs through the Career and Coaching Program. 

• Environmental, social, and governance (ESG) principles integrated in the curriculum.

Our Global MBA is built around six future-focused capabilities: adapting, analysing, influencing, leading, problem solving, and strategising. It is designed to meet the changing needs of the labour market, where increasing tech-driven disruptions redefine and create new opportunities for work. It is modelled on a stackable concept where you determine what you’ll learn, how much you’ll learn, and when you’ll learn. 

For both, we work in collaboration with our alumni and corporate partners to provide a world-class education that is applied and engaged in the challenges we face in society and in our economy. Business and business education are being disrupted as never before by globalisation and rapid technological change. 

How are you future-proofing your School’s postgraduate Business programmes? 

The year 2020 was a challenge for us all, and at Macquarie Business School, we saw exceptional efforts from staff to deliver high-quality teaching and student experience, despite the challenges presented by the global Covid-19 pandemic. 

Our courses are co-designed with industry, meaning our degrees are reflective of industry realities and future demands. Students graduate with the skills and knowledge they will need to meet the current and future challenges of their chosen profession. 

We work to create innovative, engaging, and impactful learning experiences for our students. This includes work-integrated learning at scale, flexibility in delivery, future-focused curricula and an enriched and engaged student experience.

Our focus on work-integrated learning at scale has been affected by Covid-19 interruptions. There are now opportunities to extend employability, mentoring at scale and with alumni, and more work-integrated learning using digital modalities and technology.

In response to the global challenge of finding ways to provide access to digital skills learners from around the world, Macquarie Business School created a set of courses on Excel Skills for Business. The seemingly mundane topic remains a key skill to acquire for anyone looking for work. With the surge of interest in data analysis, Excel remains a critical digital ‘door-opener’ skill in a rapidly growing segment of work. In partnership with Coursera, we launched four Excel Skills for Business courses that have since attracted more than 150,000 learners from across the globe.

Do you think the business education sector, as a whole, is responding quickly enough to this disruption?

Last year meant a rapid move to online learning for our students. Our staff made a tremendous effort and commitment to achieving a positive experience for our students. Across the sector, in response to the disruptions we have experienced, there is significant work underway to provide students with the skills necessary to manage through disruption. 

The interface with Technology and STEM is crucial to the future of business research and education. This is why we offer a Master of Business Analytics which is cross taught between Macquarie Business School and our Faculty of Science and Engineering. It’s a great programme, and shows the power of multi-disciplinary education as we begin to think about the education of the future. 

How is technology continuing to impact Business Schools in the wake of Covid-19? 

Covid-19 has prompted a reimagining of how, when and where we deliver education to our learners. The opportunity now is to move to a hybrid model, capturing the best of online and in-person, synchronous and asynchronous learning, while also optimising student engagement, connection and collaboration.

For example, Macquarie Business School is partnering with Forage to deliver in-curriculum virtual work experience to students on our post-graduate courses. Covid-19 has meant that many students have had difficulty accessing work experience in the real world. Forage bridges a critical gap by providing a platform that allows organisations to bring real-world career experience to students through bite-sized virtual experience programmes.

Is there a reluctance on the part of Business Schools to introduce too much change into their programmes? 

Not really. We have increasingly given responsibility to course directors to guide us on where programmes need to head, and our academic colleagues apply their judgement across disciplinary context, commercial understanding, and student need. 

MBAs care about sustainability and climate change. How important is sustainability, and in what ways have Business Schools adapted this into their programmes? 

Sustainability and social responsibility are embedded throughout the curricula of our MBA and GMBA. The GMBA also has the standalone subject ‘Global sustainability and corporate social responsibility: Be sustainable’. In alignment with the United Nation’s Sustainable Development Goals, other subjects in the degrees pick up on critical themes such as resilience, diversity, inclusion, and meaningful work.

The publication of Industry and Higher Education – Case Studies for Sustainable Futures positions Macquarie Business School as a thought leader in sustainable business education. The book investigates how industry and higher education can work together to create sustainability in business, and analyses international cases of industry and university interaction as a mutually beneficial symbiosis, promoting innovative and sustainable business practices.

Given the 2020 fires in Australia, do you think Business Schools have a role a play in helping communities to respond to natural disasters?  

Business Schools have an essential role in equipping our student community with the skills and knowledge necessary to deal with such disasters, and to face the challenges of our world. 

Macquarie Business School works hard to give students the skills to solve real-world problems. Our students will need agility and resilience to deal with shocks that occur to the economy and to respond to these effectively.

What do you think sustainable leadership looks like?

I think of sustainability of others, and sustainability of self. Sustaining others means linking into the central, enduring, and distinctive aspects of people’s motivation to be part of the organisation. Sustainable leaders need to tap into this and nurture it. Sustaining the self means being clear about one’s values and managing time carefully to maintain one’s health and mental energies.

As a leader in the field of design-led strategy, could you tell us about your work and research in this area? 

Design-led strategy represents a fundamentally new way of thinking about strategy, which brings customer perspective into the boardroom. It’s the opposite of traditional strategy, which starts with the hypotheses (and sometimes the biases) of top management. 

This way of formulating strategy is more relevant to our modern age where there is need for enhanced data from customers, and increased ways of collecting it. 

We need new approaches to strategy, informed by speed, agility, and the ability to work at the intersection of business, science, and engineering. Design-strategy, and my course on Coursera covering this, offers a way to respond. 

Given ongoing VUCA disruption, do you think the concept of ‘strategy’ we adopt in businesses around the world needs to be reconsidered and replaced? 

One of the most dynamic and exciting fields is that of strategy. Strategy, by definition, is about the future. Modern strategy now calls for something more: the ability to think and feel, to analyse and intuit, and to act and react.

We are beginning to realise that strategy is more than what you intend to do. It is just as much about how you respond to the unexpected. Covid-19 has put this in sharp relief, but it is by no means the exception. 

Every crisis, whether it be an environmental disaster, reputational threat or financial precarity, must be understood in terms of the preparedness of the executive – how well have they already considered all possible outcomes, intuited the future, covered off all contingencies and unpredictable ‘black swan’ events?

Therefore, design-led strategy is important – now more than ever. Design-led strategy is one approach that executives can adopt to ensure they stay relevant to customers, both today and tomorrow. 

We need new approaches to creating strategy that keep up with the fruitful and dynamic intersection of business, science and engineering, and are informed by speed and agility.  

Do you think the events of 2020/2021 (from Covid-19 to geopolitical upsets and environmental crises) will lead to short-to-medium term changes in how businesses need to be run? 

I think organisations are determined by the energy and motivation of the people who staff them. 

The biggest challenge of 2022 will be renegotiating the organisational-staff relationship, as staff (hopefully) return to offices around the world, and also rethinking the nature of flexible work, team building, and remote and digital communication. 

How does your School facilitate career opportunities for international students who wish to stay on and work in Australia after graduating?

Our MBA Careers Team provides a range of initiatives to help all our MBA students make important decisions about their career. We provide services such as personalised careers coaching sessions and career development workshops. The aim is to help students develop an individualised action plan to achieve the career they want. We also work very closely with industry partners, prospective employers, and recruitment agencies to bring more internship and employment opportunities to our students and alumni post-graduation. 

An example is our LIFT mentoring programme for graduates. This is a free, flexible, and online flash mentoring programme that allows our alumni to engage in multiple mentoring partnerships with our dynamic 90,000-plus Business School alumni.

And what are the next steps for yourself as a Business School leader? 

As flagged above, being present for staff as we work through change and recover from Covid-19 is the big issue of 2022. As an education leader, this is also an important issue for our students coming back onto campus. 

Getting this right, and making people relaxed, comfortable, and excited to reconnect as we recover from Covid-19, is the top priority. 

Do you feel optimistic about the future of business, Business Schools, and the economy?

Absolutely. The great privilege of university life is to come to work every day and look down the pipeline of the future. 

We have extraordinary challenges facing our society and economy, but also incredible discoveries. Business Schools play such a vital role in these, offering the economic, financial, communication and organisational skills to realise ideas into action. 

Any student wanting to run an organisation, found a company, or be a good colleague will always find something of value and use in a Business School education. 

But I also think a business education should be had in combination with other disciplinary knowledge and other worldly skills so that our next generation emerge from their university education as all-rounded, resilient, and multi-disciplinary citizens.

Eric Knight is Executive Dean and Professor of Strategic Management at Macquarie Business School.  Previously, he was Professor of Strategic Management and Pro-Vice-Chancellor (Research – Enterprise & Engagement) at the University of Sydney. He earned his DPhil from the University of Oxford, before working for the Boston Consulting Group for several years. 

This article is adapted from one which originally appeared in Ambition – the magazine of the Association of MBAs.

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Making it personal

Business Impact: making it personal

The impact of globalisation and consumerism on business education. Ellen Buchan and David Woods-Hale share key themes from an AMBA & BGA roundtable event

Higher education is becoming borderless, moving from a domestic industry to a global one, competing internationally. According to the European Commission, almost half of all member states consider attracting and retaining international students to be a policy priority.

For students, options around where to study are expanding at no extra cost, while from an institutional perspective, the range of potential customers is increasing. However, this means the level of resources allocated to marketing must also increase, as will the need to implement high-quality and efficient marketing strategy. 

In addition, institutions will have a wider range of nationalities, cultures, and behaviours on campus, and will have to adapt and personalise all processes and services in order to provide a unique student experience to those new global profiles. Currently, students on campuses are a mix of digital natives (the generations of young people born into the digital age), digital immigrants (those born during the 1960s and ‘70s who learned to use computers at some stage during their adult life) and analogue natives, born before 1960.

By contrast, in 2025, 100% of the students will be digital natives. Providing a quality experience for a digital native student will – and must – become a critical decision point in the potential student (customer) interaction with the institution at the marketing and recruitment stage.

Students will treat educational institutions as a regular business from a consumer perspective. This is supported by a 2020 consumer report by Salesforce.org, which shows that 78% of students expect their experience to be personalised.

In a bid to explore these themes, address the challenges above and share insights into the solutions needed to address the fast-changing marketplace, AMBA & BGA, in association with Salesforce.org, brought together a group of Business School leaders to discuss the impact that globalisation and the rise of consumerism is having on business education – and how this will reshape the fundamentals of the MBA in the future. 

Here are some highlights of that conversation. 

Julio Villalobos, Director, CXO Strategic Industry Advisor, Education EMEA Center of Excellence, Salesforce.org

We need to treat our students not only as students, but also as customers, which is how they are being treated in many other industries. We must keep that concept in our mind and reflect it in our processes around the student’s 360º journey. Students became alumni – potential lifelong learners and customers of the future.

Timothy M Devinney, Chair and Professor of International Business, Alliance Manchester Business School

I think students have been trained by the administrative structures of universities and Business Schools to believe that they are customers. I have always argued against that. 

The problem is that when you start taking a consumer attitude (asking if they want ‘fries with their theories?’, as I jokingly put it) we end up in a world in which Business Schools are very transactional, and are measured according to the immediate satisfaction of the student, who may have no idea of the future value of what they are being taught. 

The interaction with international students, in particular, is mainly transactional. They pay their money, do a lot of things, and then go home and hope to be able to get a job. We have seen, in the case of Australia (where international students have questioned the value of their university experience) that this can be a short-term win but, in the long run, it corrupts the overall educational experience. The question I have always asked is: ‘Do you have a transactional model, or do you have a relational model?’ The best Schools are very good at avoiding the transactional model and trying to build a relational model, but you must invest a lot in order to do this, and few Schools know how to do this well.

I have started to argue for a rental model of degrees; it goes back to micro-credentialing. Rather than signing up for a one-year programme where students go through modules intensively in a year, they sign up for a plethora of things. I propose that institutions sign contracts with students that commit to providing them with a whole series of opportunities, for a set of fees, over a period of 10 years.  

The idea that you enter higher education at the age of 25, and know what you want, simply doesn’t work – nor is it realistic. Even if you know what you want to do (or think you do), the ground is going to shift under you. You want to minimise the risk associated with this. So instead of a one-year programme, you have a portfolio of provision from the institution. This becomes very relational and  ensures students don’t forget what they learn because they get ‘booster shots’ that keeps that knowledge from waning. 

You could partner with other institutions to become a portal for learning; some elements you would provide, others you would just facilitate. Different institutions could then specialise, rather than having to be be all things to all people. They could be much nimbler and more adaptive.

Vincenzo Baglieri, PhD, Associate Dean Masters Division, SDA Bocconi School of Management

The amazing success we had in the past couple of years on MBA programmes is mainly because of the move from a transactional approach to a relational approach. 

That was the consequence of redesigning programmes to include more ‘peripheral’ activities, working on the soft relational competencies, and taking care of students from a lifelong perspective. 

With the full-time MBA students, it’s harder, because they are more transactional then the executive MBA students. They apply because they are very ambitious people, and they expect an impressive return on investment. Thus, the Business Schools teach them all the content they may need, even if it’s useless in the very short term. I guess we should take more of a longitudinal perspective, moving from a full-time MBA to a full-lifetime MBA programme.

I see a potential change in our business model, because the one we all adopt currently is still very transactional; we are still based on a very old model. We operate like factories, but we should act as theatres. We are not creating a product, but having a transformative impact on our students. 

Jane E Armstrong, Senior Director, Education Industry Solutions, International, Salesforce.org

Students have greater expectations and are used to a more relationship-driven, customised approach in their day-to-day lives, due to consumerism. Thus, they have similar expectations of their universities. There is an opportunity for universities to further enhance relationships with students and to deliver a more personal experience, making it easier for them to get the support they need – inside and outside of the classroom – and to provide more rewarding and enriched learning experiences. 

As one university president often states: ‘Everything in the classroom should be hard, but everything outside of the classroom should be easy.’ 

This is where there is an opportunity to make a university more ‘consumer’ driven and to deliver a more seamless, tailored student experience. 

In terms of future opportunities, universities need to leverage – and harness – their data. However, that’s often challenging because the data tends to be very siloed and disconnected. Increasingly, universities are asking how they can connect the data across their institutions so that they can have the insights to make the strategic decisions needed to deliver their missions and visions. 

Also, universities are increasingly exploring and adopting new technologies that support ‘cradle to grave’ – from recruiting the right students to their institutions (those who they know will be successful) to engaging these individuals as lifelong learners (the people who want to come back for reskilling or upskilling). Thinking about all these opportunities, universities are fundamentally questioning how to adapt their business models and embrace digital transformation.

Grażyna Aniszewska-Banaś, Associate professor, Canadian Executive MBA Director, SGH Warsaw School of Economics 

I think that digitalisation changes the consumption patterns, the communication patterns, and requires some cultural changes in terms of the organisational culture of universities, knowledge centres, and MBA centres. It requires different values, norms and ways of thinking about the students. I believe in creating communities, because whether we’re talking about customers or clients, it is better in terms of values to create a community where every member has the support of the community. 

In terms of the delivery of knowledge, an idea that we have in our programme comes to mind. Every graduate is able to go back to our School and take any course they want for free – so that they can refresh the knowledge and find out about about trends, gain new skills, and so on. What’s important is the sharing of the experience and skills. So, the students receive some of their knowledge from our graduates; they are practitioners, they can share their experience with current students. 

I think that the changes in the business models are about the relationship, about the creation of community, and being open to the knowledge of our graduates and the students. It should be two-way communication.

José M Martínez-Sierra, General Director, UPF Barcelona School of Management

Right after I arrived at Harvard in May 2012, there was a headline in the Boston Globe saying that Harvard and MIT would join EdX. A number of articles said that was going to change higher education, with these two institutions (and others) giving out degrees for free. There was a wave that said everything was going to change. What we have learned from it is that the fundamentals always remain. 

Education, and our Schools, are providing students with two things: one is skills, and the other thing is a network. That professional network is going to be with you throughout your life. It’s a combination of what we do in the classroom while the students are in our Schools, plus this great club that we are trying to build at the same time. 

I think that the transformation we are going through is in the second part of our dimension; it’s the community we are creating and how this community and professional network is coming along in relation to our learning.

Gerardine Doyle, Full Professor, UCD Michael Smurfit Graduate Business School, University College Dublin

MBA students come to us because they want an excellent, personalised student experience; they want to be here in person and on campus. The experience of the pandemic has accentuated this – students crave human connection and interaction. In the coming years, our challenge is going to be around how we achieve and maintain that optimal experience; which elements of our programmes (teaching, teamwork, and co-curricular activities) will be in person and which may be suitable for the online environment? While our students are with us on campus, how can we provide the best possible student experience? 

This is going to be our greatest challenge: finding that optimal blend that will achieve our learning outcomes, while also providing a personalised learning journey. Conversations with our students throughout the pandemic brought this idea of personalisation to the fore as a feature of our MBA programmes which is very important to them.

We reopened our campus for two weeks in September 2020; however, we then had to return to online delivery due to public health requirements. Our students crave and value peer-to-peer interaction and strong connections with faculty, and so the relationships they build up during their MBA journey contribute to that special and personalised experience. 

Our cohorts of 2020 and 2021 have asked whether they can return in future to participate in new modules and executive programmes, which highlights that the lifelong learning for MBA alumni is definitely something that our students desire.

We create a personalised experience. For example, each individual student has their own mentor – an alumna/alumnus of our MBA programme, many of whom are working in senior positions in leading global financial services, technology or pharma companies, or are entrepreneurs. 

During their MBA journey, our students work closely with their mentor who guides them throughout their learning and leadership journey. This mentorship experience is very important.  

In addition to the classroom experience, and the rapport developed with our faculty, extracurricular and co-curricular activities are critical to the personalised, lived student experience. 

We have been innovative in developing the leadership skill set of our students by enhancing our global leadership programme and enabling our students to develop their intercultural competencies.

Roundtable attendees

Grazyna Aniszewska-Banas, Director of Executive MBA, SGH Warsaw

Jane E Armstrong,
Senior Director, International Education Industry Solutions, Salesforce

Vincenzo Baglieri,
Associate Dean of Masters Programs, SDA Bocconi

Timothy M Devinney,
Chair and Professor
of International Business, Alliance Manchester Business School

Gerardine Doyle,
Associate Dean, UCD, Michael Smurfit
Business School

Jose Manuel Martinez-Sierra,
Director General, UPF Barcelona School
of Management

Julio Villalobos,
CXO Strategic Advisor, Salesforce

This article originally appeared in Ambition – the magazine of the Association of MBAs.

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To grow a business you must also develop its leaders

Business Impact: to grow a business you must also develop its leaders

Leadership and business development must be designed in tandem within organisations – and Business Schools can provide the education to support this, writes Aalto University’s Pekka Mattila

Leadership development is crucial in creating competitive business advantage. It improves financial performance, helps attract and retain talent, drives strategy execution, and increases success in navigating change. Leadership development should be seen as part of overall business development. In short, leadership and business development are two sides of the same coin. 

But not all organisations have caught up with this view. This could be due to the fact that resources in both public and private organisations tend to fluctuate, and HR projects are the first to fall victim to cost-cutting. This causes the business to lose sight of the bigger picture. HR development and business development happen in parallel, but in silos – they are often very disconnected, even though they depend on each other. 

When running a business, ultimately the main goal is to make a profit, and HR can contribute to this, but during periods of economic instability, the main aim is to keep the business afloat. Anything that is not needed to keep the business running takes a backseat. Developing employees is important, but ensuring they keep their jobs is even more so. 

When an upturn eventually comes around, the business begins to address the maintenance backlog accrued during the cost-cutting period, and must start from scratch as HR projects were put on hold, or phased out. To avoid this chain of events, smart organisations will formulate an overarching trajectory for their leadership development objectives and activities. 

For this to succeed, they need leadership development and business development. 

Leadership development programmes offer external inputs as stimuli. However, growth does not take place in a classroom, it happens when leaders apply the skills they’ve learned in their work. By combining business development and leadership development, employees can apply these skills immediately. Only by combining leadership and business development will individuals be able to conduct experiments, implement experience and insights, and close the knowing-doing gap. It also allows them to validate what they’ve learned and see how it works in their own contexts. 

Develop the right leadership programmes

Leadership development programmes often offer a ‘buffet-style’ experience. These programmes dish out a spectrum of coaches and facilitators with many tools and concepts. However, the selection is so varied that it could lead to ‘overeating’, where participants end up with huge piles of literature and other materials, but lack the opportunity to apply their learning to their work. 

This approach can often overwhelm participants, but the goal is not for every individual to adopt every tool and concept on offer. Instead, a high-quality leadership development programme caters to many different skills and needs. 

Here at Aalto University Executive Education, we strive to integrate a live business case into each programme so that participants can test their new skills and knowledge and see what works for them.

Leadership training with a vision

Leadership development programmes are linked to organisations’ long-term visions. In the best-case scenario, the strategy is also still in the making and the strategy dialogue takes place, in part, on the leadership programme platform. This way, the programme provides an opportunity to validate hypotheses on the go. Programmes make it possible to facilitate these discussions in a structured manner. 

In strategy work, it is important to decide what we choose to believe as ‘truth’. All industries have become more challenging; they find competition in unexpected places, or notice their competitors innovating with revenue and business models. 

Smart organisations will view leadership development programmes as voyages of discovery to uncharted territories, or as an opportunity to validate assumptions. 

Support for strategy implementation

Many organisations will have already formed a strategy but not yet implemented it. In this scenario, a leadership development programme can provide outside support and guidance, or serve as a platform for launching projects. Having a programme means that projects don’t get buried under competing priorities. They have a structure, a timetable, a support system, and control points. 

The challenge most organisations face is that people get excited about ambitious new strategies and visions, but ask what’s going to happen next. This places pressure on management to show that the vision will lead to action, and that they are serious about implementing it, not just trying to be trendy. In this situation, a leadership development programme may serve to prove that things are changing. 

When implementing strategy, the timeline is important. It’s vital that the organisation gets moving in weeks, and achieves a concrete milestones within months. This may be as simple as announcing that a task force has been launched – another thing with which leadership programmes can help. 

Goals provide focus 

Leadership programmes are not only a great way to make people feel included, but also a way to channel the organisation’s energies in the right direction. But this only works if the programme is directly linked to the organisation’s ambitions – so the more concrete objectives organisation can present, the better. Effective goals are always measurable because it helps identify what must happen to achieve results. 

Leadership skills impact the bottom line

As I’ve already stated, leadership development is proven to help organisations achieve their business development goals, but it also gives backing to the entire management team responsible for implementing the organisations strategy. 

Research carried out by McKinsey and Egon Zehnder in 2011 revealed that while talent is always important, only exceptional talent makes a real difference. According to the report, there was a high correlation between executives with ‘excellent’ capabilities and the organisations financial performance, while merely ‘good’ performance showed no correlation. 

In appraising leadership development, we should move from measuring intellection and cognitive skills to evaluating the concrete actions taken and the results achieved. 

The real impact of a leadership development programme should manifest itself in improved business development performance. 

What does this mean for Business Schools?

If more organisations adopt the idea that leadership development and business development go hand in hand, then they will start to rely on Business Schools more and more to provide them with the education to support this. 

Combining leadership and business development benefits both the organisation and the Business School. It benefits the organisation because, as I said earlier, leadership development and business development are two sides of the same coin. By using leadership programmes to develop the leaders within a business, you will help the business to succeed, because a good leader will implement vision and values, ensure effective communication, and motivate employees. 

It will benefit the Business School because more people will attend the School, but it also brings in a variety of different voices who have had experience in different industries. 

Working together with an organisation allows them to bring in real-world problems, discuss and come up with a solution – which will then benefit the individual when they face a similar problem in their job. By combining leadership and business development, you are truly enhancing their education. 

Pekka Mattila is the Group Managing Director of Aalto University Executive Education and serves as a Professor of Practice at the Aalto University School of Business.

This article originally appeared in Ambition – the magazine of the Association of MBAs.

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How businesses can destigmatise mental health in the workplace

business impact: business-community-team-diversity-wellbeing

A happy community is a productive community, but policies to protect workers’ mental health don’t go far enough, says Yashmi Pujara, Chief Human Resources Officer at Cactus Communications, drawing on the findings of a global survey of 13,000

Mental health problems are still widely stigmatised in business. In July 2021, a McKinsey report indicated that while 80% of full-time employees believed a mental health anti-stigma or awareness campaign would be useful, only 23% of businesses are reported to have implemented a campaign in their workplace. Efforts by some employers to destigmatise these conversations are paving the way for more open discussions and policy changes, but the movement is slow to take hold. 

A combination of working more than 48 hours per week and a lack of effective government policies around work-life integration has resulted in 11% of UK workers feeling overwhelmed and unhappy, according to a report from the Institute for Employment Studies. In the UK, there are policies for parental leave and flexible working that attempt to improve work-life integration for workers, but these are left to the discretion of businesses and they can deny these requests if they believe it affects the business adversely.  

Furthermore, people having to work remotely because of Covid-19 has meant the lines between work-life and home-life have become blurred. On average, home working has led to a two and a half hour increase in the average working day and employees are suffering from more fatigue, stress and burnouts than ever before.

In a survey conducted by CACTUS with 13,000 researchers across the globe, only 8% of the respondents felt their organisation had effective policies around work-life integration. Let’s look at why employees are feeling this way and how businesses can redress the balance.

Overwhelmed and underappreciated

CACTUS’ first survey was conducted before the pandemic, in October 2019. Yet over one third of responding researchers felt overwhelmed by their work situation and said this was negatively impacting their mental health. The problem will only have worsened since. 65% have since stated that they were under tremendous pressure to publish papers, secure grants and complete projects, without the office social interactions to dispel tension. 31% of participants reported that they worked more than 50 hours a week from home and 13% reported they work past 60 hours per week. 

Since 2020, most businesses have adopted some form of work-from-home culture, so these statistics will be echoed across the entire working population. In a similar mental health survey conducted by Business In The Community, 51% of 3,614 UK workers thought their mental health problems had caused increased pressure from their employers.

Furthermore, businesses across the world are experiencing record-breaking numbers of resignations — approximately 400,000 in three months in the UK alone — during a period being dubbed ‘The Great Resignation’. This is because workers are dissatisfied with their employment. While mental health will not be the only reason for people quitting their jobs, it must be viewed as a contributing factor.

The expectation that everyone needs to be constantly working, no matter their profession, is incredibly damaging. The response from our own workforce is clear, culture needs to change to promote a healthy work-life integration.

Dealing with discrimination

Discrimination, harassment and bullying all contribute to declining mental health at work. In CACTUS’ follow-up survey taken during the pandemic, 23% of researchers wanted to see more measures to promote equality and prevent discrimination. 45% of respondents identifying as homosexual and 42% of females reported being bullied, harassed or discriminated against at work. A significant number of respondents described instances of sexual harassment that weren’t dealt with adequately, if at all.

It’s unsurprising that 48% of respondents who felt a need for tighter policies on discrimination and bias also reported feeling overwhelmed at work. To protect the mental health of all employees, business managers must structure plans to better police bullying and harassment. It may also be beneficial for institutions to create confidential spaces for mental health support on and off-site. If a company has a workforce that is still predominantly working from home, it’s crucial that concerns about inequality are dealt with, without the worker feeling disconnected or isolated.

Job security and mental health

Higher salaries and job security were common requests from surveyed researchers. Demands for better wages have been echoed across the public sector, where 48% of 12,000 workers said they had experienced mental ill health. Several comments made in response to the CACTUS survey implied there are correlations between finance-related stress and overall poor mental health. 

In CACTUS’ follow-up survey, 38% of respondents disagreed to feeling satisfied with their financial situation, and instead felt like they had worked past their contracted hours without being compensated for it. 

In academia in particular, workers lack stability of employment — the jobs are where the funding is. This is similar in many businesses that offer zero-hour contracts where possible. It’s not as easy as asking businesses to pay employees more because financially it may not be feasible. However, managers can ensure staff aren’t working vastly over their contracted hours and that they are taking all their allotted annual leave. Job security can be created by reducing fixed-term contracts, and this will prevent anxiety around long-term financial stability. Above all, decision-makers need to be aware of those business areas lacking financial and wellbeing support so that appropriate changes can be made.

Communication is key

Workers can feel disconnected from their colleagues when working remotely. The follow-up CACTUS survey found that 17% of researchers asked for improved communication between colleagues, collaborative working and the fostering of a more social environment. Ultimately, these things will improve cohesion in the workplace and have a positive impact on people’s wellbeing. 

Of course, physical health is equally as important. In some countries, restrictions on people gathering in an office are still in place. Therefore, business leaders have a difficult task in implementing policies that can build a social environment. However, social spaces can be provided for smaller groups, where possible, and virtually, which will ultimately lead to better relationships, happier employees, and a successful business.

It’s important for employers to realise that pressure and exploitation don’t produce the best business outcomes. By valuing people holistically, our working population will be a happier one and the quality of results will be significantly better too. The simple reality is that working culture needs to change to promote a healthy work-life integration. After all, a happy community is a productive community.

Yashmi Pujara is Chief Human Resources Officer at the technology company, Cactus Communications (CACTUS). Over 15 years, Yashmi has been instrumental in shaping at CACTUS’ unique culture and has played an important role in conceptualising and implementing its people policies, earning industry recognition and awards in the process.

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Encouraging acceptance over assimilation

Business Impact: Diversity - acceptance over assimilation with UCL School of Management

Encouraging acceptance over assimilation

Business Impact: Diversity - acceptance over assimilation with UCL School of Management
Business Impact: Diversity - acceptance over assimilation with UCL School of Management
The unique perspectives brought to organisations by international students and workers may be tolerated in the first instance, but there are often expectations that newcomers assimilate to presiding norms over time. UCL School of Management’s Felix Danbold outlines why business schools should be ready to anticipate and address tensions that may emerge

Moving to a new country for one’s studies or work can be an exhilarating, enriching and often daunting experience. The typical international student has a lot on their plate. On top of their coursework, they might have to become increasingly fluent in another language while also forging new connections in a country with new norms and expectations. International students studying on management or MBA programmes are often also faced with the stresses associated with gaining valuable, but demanding, international business experience and securing highly competitive jobs in their chosen country.

When you couple moving to a new country with finding a new job, expats might wonder how they can navigate these changes successfully. When starting at a new university or job, international students may feel pressure to conform to the expectations of new colleagues and employers. A real worry may emerge that if they don’t assimilate, they may experience bias and ostracism. This pressure to conform may be especially challenging for international students who strongly identify with their country of origin, and who are reluctant to sacrifice their norms and values for the sake of fitting in.

The tension that international workers feel these days echoes a common challenge for contemporary organisations and universities. These institutions, now recognising the value of diversity and inclusion, often want to embrace difference among employees. Tolerance of difference allows each employee to bring unique and valuable perspectives to the workplace, enhancing innovation and progress. 

However, we know tolerance isn’t always guaranteed, and that many would prefer it if all minority groups assimilated to the majority’s way of doing things. Some degree of assimilation will always be necessary just so organisations can function, as a common language and way of doing things is essential for coordination and efficiency. How then, can we collectively ensure that students and workers from international backgrounds are all able to succeed and contribute, while also sparing them the pressure to give up their valuable perspectives and sense of self?

Understanding where majority group intolerance comes from

Understanding how we can help alleviate the pressures on immigrants to assimilate requires an understanding of who is generating these pressures – i.e. the native-born majority group. Throughout history, there is an abundance of examples of majority groups treating minorities poorly and, despite some progress in recent years, this is not a phenomenon that we’ve escaped.

The majority group’s desire for minority groups to conform to the majority’s norms is rooted in the fundamental dynamics of social groups. In diverse settings, the majority group typically enjoys the privileged position of representing the broader category in which they reside. For example, when people think of what it means to be a citizen of a given country, they typically think of members of the native-born majority group. This means that the majority group sets the norms to which other groups are expected to conform. Being the group that is most strongly associated with their broader context affords members of majority groups a reliable sense of inclusion and comfort. In academic terminology, we would say that majority groups are ‘prototypical’ of their broader contexts.

There are many examples of prototypicality in action. For example, in historically male-dominated professions like firefighting, men are prototypical, whereas women are not. That is, when asked to think of a firefighter, most people will think of a man. Within firefighting, stereotypically masculine traits (such as strength, stamina and decisiveness) are often privileged over stereotypically feminine one (such as compassion and patience). All of this means that women have a harder time being recognised as fitting the mould of a ‘true firefighter’. This doesn’t mean that individual men can’t also struggle to fit in, only that their gender is unlikely to be the source of these challenges in the same way that it is for women. 

International students and immigrants often face similar barriers as a result of their non-prototypicality. People who are native to their country of residence don’t have to worry whether their nationality will put them at a disadvantage in the same way that immigrants often do.

Expectations of assimilation shape bias

Compounding the disadvantage that immigrants may face given their non-prototypicality, my research highlights how the senses of group prototypicality can actually drive increases in bias against minority groups, such as international students. 

The sense of security and comfort that prototypicality affords can quickly dissipate when change is felt to be imminent. If established majority groups notice an increase in the representation of minority groups, they may feel that their prototypicality, their very sense of belonging and the sense of comfort connected to it, is threatened. The majority group may feel like they will soon be the ones who will have to worry about fitting in. My research shows that this sense of ‘prototypicality threat’ – the fear of losing prototypicality – is a powerful driver of dominant groups’ resistance to diversity.

My own research has also shown that feelings of threat are deeply influenced by prospective beliefs about whether intergroup difference will grow or shrink over time. Members of majority groups are most susceptible to prototypicality threat when they believe that minority groups are unwilling or unable to assimilate over time. In contrast, however, members of majority groups who believe that minority groups will assimilate do not experience this threat. That is, members of dominant groups are willing to tolerate some difference in the present, but only if they believe it will diminish over time.

Increasing tolerance

In light of this research, one might think it would be best for international students and immigrants to always assimilate as the best way to avoid conflict when interacting with members of their new country. 

Although my research shows that this would, indeed, reduce the discomfort felt by the native-born majority, we strongly recommend that individuals and organisations avoid this approach. As noted, some degree of assimilation will be necessary, but total assimilation will undermine diversity and inclusion goals and may come at great psychological cost to immigrants who feel attached to their identities. Furthermore, members of the majority group may still feel threatened by immigrants in other ways, like perceptions of increased competition over jobs and resources. 

Rather than sacrificing diversity to placate an anxious and privileged majority, efforts should be directed at increasing tolerance. Reminding members of the majority group that their ‘prototypicality’ is incidental, and that institutions are perpetually redefining themselves to better fit in a changing global market may be one way to reduce majority group resistance to change. Emphasising the value of diversity and inclusion for everyone may be another way to encourage members of majority groups to overcome their discomfort in welcoming international peers who retain, rather than shed, their unique backgrounds. 

Efforts to encourage inclusion will also need to be embraced and enacted by leadership. For immigrants, this may mean drawing attention to the often-subtle peer pressure that makes someone feel like their sense of belonging is conditional on assimilating. Employee resource groups where members of minority groups can talk about their experiences with those in a similar position can be beneficial as well. Mentorship programmes and town-hall meetings can ensure that communication is maintained and that any latent tensions are addressed before they lead to serious conflict. To ensure that the burden of responsibility does not fall entirely on new starters, leadership should act quickly to create these structures if they do not exist already.

None of the difficulties I’ve mentioned should dissuade anyone from choosing to study or work in another country. I genuinely believe that the experience offers unrivalled opportunities to grow knowledge, capabilities and cultural awareness. I also don’t want to suggest that intergroup conflict is inevitable, as many people will have wholly positive experiences studying or working abroad. However, given how commonplace intolerance still is, institutions should be ready to anticipate and address tensions that may emerge. I hope that international students moving on from their management programmes also remember the uniquely different perspective that they bring to organisations and the inherent added value that provides. It should not be forgotten, because it cannot be replaced. 

Recommendations for leaders in business schools and beyond

Here are three things that leaders in organisations can do to increase appreciation for international students and workers:

1) Prepare for some discomfort from the majority group

All people naturally get comfortable doing things in certain ways over time. This is especially true when they feel like their own way of doing things is the way that the majority of people have always done them. Introducing different and new perspectives can sometimes lead to disagreement and tension from those who would prefer that others assimilate to them, rather than the other way around. Business leaders and managers should be prepared for the possibility of complaints from members of majority groups and take steps to ensure that these unsettled individuals don’t take out their discomfort directly on the newcomers.

2) Carefully define what you value

The traits we collectively value in our institutions and organisations often inadvertently reflect the traits already associated with the majority group. If organisations reinforce this in one way or another, they may unwittingly legitimise the idea that the majority group is valued more than newcomers. Highlighting the value of the traits associated with international students and workers can both increase tolerance and dispel the notion that the majority group’s way of doing things will always be the best. Emphasising the importance of diversity and inclusion, and making a public commitment to these goals, can also help remind hesitant individuals that their organisation wants them to embrace difference. 

3) Give international students and workers a way to speak up

Belonging to a minority group can be an isolating experience, so organisations should proactively provide opportunities and spaces for international students and workers to gather together and talk about their shared experiences. Direct communication with leadership can help ensure that challenges are being identified and addressed.

Felix Danbold

Felix Danbold is Assistant Professor in Organisations and Innovation at UCL School of Management. Previously, he was a Postdoctoral Research Scholar and Visiting Assistant Professor at NYU Stern School of Business. 

Danbold holds a PhD from UCLA, where he taught and conducted research in the Psychology Department and Anderson School of Management.

Business Impact Front Cover August 2021

This article originally appeared in the print edition (August 2021) of Business Impact, magazine of the Business Graduates Association (BGA).

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Business Schools’ vital role in driving innovation

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As products and business models become more complex, innovation requires specialised academic institutions, writes Arturo Bris, Director of the IMD World Competitiveness Centre

In the late 19th century, two French brothers – Auguste and Louis Lumière – invented the cinematograph. They are credited as the founders of modern cinema, and owned more than 170 patents in imagery development, and in other fields such as medicine. They are among the few French nationals to be honoured on Hollywood’s Walk of Fame.

In those days, most revolutionary innovations were coming from England or the US; for example, the steam engine or electricity. Why is it, then, that the Lumières – young men from Lyon, a mid-size city in France – gave the world such important technology? 

Auguste and Louis’ creativity was the result of their family – their non-conformist father was the owner of a photography business – and their personality traits (risk attitude, curiosity) also influenced their creativity. However, the main factor for the birth of cinema in Lyon is an educational institution – La Martinière – from which the brothers graduated as engineers. La Martinière could be described as the MIT of the day, with a curriculum that promoted technology, chemistry, industrial knowledge, and experimentation. As well as being the alma mater of some of Lyon’s prominent industrial and commercial leaders, it attracted students from all over the world who were interested in technology and innovation.

The ability to innovate

Very often, we attribute the innovation of specific people or countries to individual attitudes or national culture. When I ask members of IMD’s executive programme why they think that, in Europe, there are no digital platforms along the lines of Alphabet (in the US) or Alibaba (China), they either blame a risk-averse attitude among European entrepreneurs, the lack of a ‘failure culture’, or inadequate regulation. While countries such as Israel and Taiwan are innovative by nature, the same can be said of Jordan and Ukraine. So why do we rarely see see disruptive innovations coming from the latter two? 

My recent book, The Right Place: How National Competitiveness Makes or Breaks Companies, argues that, in determining corporate success, factors such as leadership and strategic choices, are marginal. From my research, and that of others, we can conclude that the impact of leadership teams on corporate performance is moderate at best; some CEOs increase value, but some destroy value. 

The factors determining corporate success are global and national. My work shows that 80% of a company’s stock return variability is explained by factors such as the business cycle, trade wars, geopolitical tensions, and regulation. The Covid-19 pandemic has taught us that the fate of organisations is often dictated by uncertainties that are not controlled by companies.

In that context, decisions at a country level, such as capital markets design, education policies, and fiscal rules for talent attraction, have a greater impact on innovation than the DNA of potential creators. Specifically, educational institutions play a vital role in shaping innovation. 

Stanford comes to mind as a global leader in the production of startups, with Alphabet being its most successful result. Facebook and Microsoft were born in Harvard dorm rooms, while, in total, Harvard is the alma mater of 1,310 entrepreneurs. Michael Dell was a student at the University of Texas when he founded his computer brand. Dropbox was born in MIT; WordPress at the University of Houston; Reddit at the University of Virginia and Fedex at Yale. Skype was developed by a graduate of Uppsala University (Sweden), and Logitech was founded by two colleague students at EPFL in Switzerland. 

Specialist institutions for innovation

As products and business models become more complex, innovation requires specialised academic institutions. That is why Business Schools have been the seed of many important innovations of the past decades. Desigual, one of the most international fashion retailers, was founded by an alumn from the IMD MBA programme. The founders of Zoom Technologies, Peloton, and Grubhub planted the seeds of their companies while attending classes at Stanford, Harvard, and Chicago Booth respectively. 

How can universities, and Business Schools in particular, be centres of excellence for innovation? First, let me point out that, for innovation ecosystems to succeed, they have to combine three key success factors. The first  is access to capital. The benefits of finance are important and have been documented by academics and international organisations. 

In 2000, Professor Jeffrey Wurgler (then at the Yale School of Management and currently at NYU), highlighted in a paper published in the Journal of Financial Economics that more financially developed countries allocate capital with greater efficiently across industries. Specifically, Wurgler found that ‘developed’ financial markets (measured by the size of the domestic stock and credit markets relative to GDP) such as the US and the UK, increase investment in growing industries and decrease it in their declining industries. 

Effective financial systems are both the consequence of and the reason for the competitiveness and innovativeness of countries. Over time, the interaction between Wall Street and Main Street – or between the financial system and the real economy –reinforce each other, and we observe the positive impact that a good financial system has on economic growth and quality of life. Conversely, countries that forget the financial sector struggle to develop a competitive economy, despite their innovation and talent.

The second important factor is regulation. To be innovative, firms need to have rules that protect intellectual property, bankruptcy laws that allow failure and recovery, and fiscal rules that facilitate foreign investment and talent attraction. Regulation removes uncertainty, and this explains why innovation is more difficult in Europe, where innovators need to comply with a myriad of regulatory regimes, compared with the US and China. 

The role of the education system

When good regulation is combined with access to capital, innovators emerge. This is where the third factor – the education system – plays a vital role. Business Schools are becoming important parts of a country’s innovation ecosystem. Entrepreneurs need to be more than creators, and need to learn how to monetise their ideas. The Lumière brothers never attended Business School. And this is probably the reason why their creation did not result in the movie industry being built around Lyon, but in Los Angeles. The Lumière brothers of the 21st century need business education, but such education must fulfill three requirements:

1. Business Schools need a good curriculum
To transform ideas into businesses, innovators need to know finance, marketing, and strategy. Design and technology skills are not enough. This also means that Business School curricula should emphasise management skills at the expense of experiential learning and leadership skills. Traditional Business School disciplines are important – especially for those who do not plan to work for a large organisation – because founders have to have a helicopter view of their companies, which requires a deep understanding of all dimensions of performance.

2. As technology will be the basis for many of the upcoming innovations, Schools need to embrace technology-related subjects
At IMD, we have reduced the importance of accounting in the MBA curriculum in favour of coding, a one-week innovation journey, and courses covering artificial intelligence, Blockchain, and Big Data analytics. We have also enlarged the finance and marketing courses.

3. For Schools to be part of the innovation ecosystem of their country, they must partner with the public and private sectors to create synergies
Governments need to realise that attraction of talent to Business Schools results in innovation, and therefore more jobs and prosperity. At the same time, Business Schools as academic institutions need to feed the country with research related to entrepreneurship, family business, and innovation. 

Business Schools must hear the demands of companies and adapt their programmes to the needs of the labour market. The benefit for Schools is that, as the reputation of their country increases, so does the ability of the School to attract better students.

Innovators are not born but made. Business Schools are part of a country’s innovation ecosystem and while technical universities (the La Martinières of our times) continue generating ideas, Business Schools transform these ideas in businesses, jobs,
and competitiveness. 

Arturo Bris is Professor of Finance at IMD and Director of the IMD World Competitiveness Centre. His new book, The Right Place: How National Competitiveness Makes or Breaks Companies is published by Routledge. 

This article originally appeared in Ambition – the magazine of the Association of MBAs.

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Reaffirming the value of a global outlook

business impact: Global-city-in-the-sky global outlook in business

IBS-Moscow was quick to return to offering an in-person international module as part of its EMBA programme earlier this year. Programme Director and Associate Dean, Ashot Seferyan, explains why. Interview by Tim Banerjee Dhoul

Amid continuing uncertainty over international travel, the Institute of Business Study Moscow (IBS-Moscow) was able to run an in-person international module for its executive MBA (EMBA) students in April. The decision was a ‘difficult but very powerful’ one for the message it sent the business community, according to the School’s Associate Dean and Programme Director, Ashot Seferyan.

As an established provider of business education in Russia, the decision taken by IBS-Moscow seems significant in showcasing the importance the country places in the value both of international and in-person experiences at this level of study. 

IBS-Moscow is, after all, Russia’s oldest Business School and forms a principal part of Russia’s largest educational institution – the Russian Presidential Academy of National Economy and Public Administration (RANEPA). Its EMBA, of which Seferyan is the Founder, was launched almost 20 years ago.

In this exclusive interview, Seferyan tells Business Impact why the Covid-19 pandemic hasn’t removed the need for a global vision in business and outlines IBS-Moscow’s approach to forming international partnerships with other Business Schools. This includes factoring in how a country’s particular strengths and expertise suit the skills that are currently most in demand from managers in Russia. 

The EMBA programme at IBS-Moscow RANEPA includes a compulsory international module. Why do you feel it is important to offer your students an international dimension to their studies in this way? 

In a global world, you must have a global vision. There is only one way to truly gain insights into the economic and cultural peculiarities of a country or region – you must travel and learn from the citizens of that country or region. And we always choose the best Schools as partners. This philosophy was taken as a core ideology from the beginning of the EMBA programme at IBS-Moscow.

In April, you were able to offer an on-campus international module in Dubai, in spite of continuing restrictions in many parts of the world. How did the School go about this and what lessons did you learn for offering this type of module, as the problems associated with Covid-19 continue?  

The decision to have an international module this April was a difficult but very powerful one. At that point, ours was the only programme in the world to take a risk in providing an overseas education and to take on the responsibility that this involves. On one hand, this decision sent a message to the business community that strong leaders can overcome even the difficulties of the pandemic. On the other hand, sharing the experience of how to behave in the ‘new normal’ has been essential for all our students and has given them some new ideas of how to reshape their businesses.

Global experiences are often said to improve a person’s understanding of the world around them and their appreciation of cultural differences. Can these experiences also help Business Schools to develop more responsible and socially conscious leaders in your opinion? If so, how? 

The social responsibilities of a leader are based mostly on cultural heritage. Good examples from outside a country could inject a much broader understanding inside a society but it is also a responsibility of a Business School to bring these ideas into its educational programmes and promote them among alumni and the wider community.

London Business School is the latest School with which you are partnering on the international module, but in past years this module has been held at leading Business Schools in Switzerland, China and Spain, among others. Why has the School chosen to vary the international School host rather than to keep one established partner? 

People differ and countries differ too – their culture, history and vision create a unique experience. This is why we have to change venues from time to time. 

Another reason is much more economic and managerial. In different countries, you can learn a different approach. For example, Italy is famous for its entrepreneurial spirit, the Netherlands for having strong SMEs, China for its tremendous transformation from socialism, and the UK for its global vision on strategy along with its heritage. 

Taking our students to different countries gives them an option to get the best experience. But when you change venues because the economic situation in your country demands specific knowledge, then you can benefit even more.

Aside from international exchange, do you think Business Schools will need to focus more inwardly (and therefore less ‘globally’) than they have been in their teaching in order to address domestic industry needs, post-Covid-19?

Life is global and the economy is global too. The pandemic did not heavily change this situation. Local economies have probably gained some advantages because of lockdowns and specific logistics. But, on the whole, businesses are competing on a global level. So, Business Schools must attract professors and business experts who are knowledgeable of both local and global issues.

The global financial crisis of 2008 has been linked to an increase in applications to Business School, as people decided the time was right to reassess their career goals and pursue personal and professional development. Have you observed any similar impact from the Covid-19 pandemic? 

At IBS-Moscow, we have definitely noticed an increase in demand for our programmes. But I would not link this upward curve just with a financial crisis or Covid-19. Taking our EMBA programme as an example, I can say that the increase in enrolment started in 2017. One of the reasons was the big infrastructural projects taking place inside Russia at that time because of the forthcoming FIFA World Cup [held in summer 2018]. 

Later, global economic changes supported the demand for managers to retrain and upskill. Covid-19 has most probably added to this demand. Previously, we enrolled about 60 EMBA students a year but, since 2018, we have enrolled about 100.

Business Schools are often encouraged to play a greater role in their local and regional communities. Has Covid-19 inspired any new events, activities or initiatives with this in mind? 

I do not think that Covid-19 has had such a big influence. Having lockdown and other barriers in our usual life, we had to transform our behaviour inside our networking communities. 

In many cases, Business Schools have used the fact that people are working from home – and therefore, have got additional free time while not travelling to and from their offices – to offer a number of short educational products. This is giving them a means of offering continued education and could also be an opportunity for our Business School.

What’s next for the EMBA programme at IBS-Moscow? A return to fully in-person classes as soon as possible or a hybrid format of in-person and online learning?

As the Director of an EMBA programme, I am aware that education at this level is very much based on networking and the sharing of an experience among students. This is why we returned to in-person classes in June 2020. 

Of course, we could use online formats for masterclasses and other forms of additional short meetings with businesspersons or interesting speakers. But our core programme is, and will be, delivered only in person.

How has the School been working to boost the global profile of management education in Russia and what remains to be done in your opinion? 

As a leader inside the country and an active member of international education networks, IBS-Moscow is trying to bridge these two sides. While bringing best practices from the west, we are at the same time promoting our local experience to the world. 

Ashot Seferyan is an Associate Dean at IBS-Moscow and the Founder and Director of its Executive MBA programme. Seferyan is also a member of the Board at RABE (the Russian Association for Business Education). He holds a PhD in managerial sociology. 

This article is taken from Business Impact’s print magazine (edition: August-October 2021).

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Gender means business: how to create real and sustainable gender equality

women-in-business-gender-equality-workplace

Gender means business: how to create real and sustainable gender equality

women-in-business-gender-equality-workplace
women-in-business-gender-equality-workplace
Making the case for the incorporation of gender measures into the study of business and the practice of entrepreneurship. Gender Rise’s Yael Nevo draws on lessons from her work with LSE’s entrepreneurial arm

Beyond the ample evidence clearly proving that gender equality and diversity (as well as other forms of diversity) lead to better businesses, I believe that it is crucial to the survival of our society, environment and the sustainability of life as we know it. To achieve this, we need to treat this issue just as we address any other business goal.

LSE Generate supports students and alumni in building socially responsible businesses in the UK and beyond, providing the infrastructure to develop and scale brilliant startups. I started my collaboration with Generate’s Head, LJ Silverman in 2018, while she was looking to set an example for gender equality and diversity and create a clear strategy for the programme as they develop, and expand their international presence.

In order to ensure that LSE’s programme is able to not only be clear on its actions but also gain consistency and sustainability moving forward, we created the LSE Generate Gender-Sensitive Code of Conduct (the Code). This document includes the programme’s values, vision, its connection to stakeholders, and most importantly, a clear action plan. The Code is a living-breathing mechanism that is subject to review and change. The version that you can see in the link above is a new one, following its recent review.

Impact of a clear action plan on gender

Since the creation of the Code more than 3 years ago, LSE Generate has developed exponentially. It grew from a staff of two to a staff of about 20, plus many ambassadors and collaborators across the globe. It runs several accelerators, funding competitions, regular events, mentoring and business support, and opened international hubs in 11 countries and counting.

Within the first year of the creation of the Code, some of LSE Generate’s achievements were:

  • 50/50 gender balance among its:
    • Board of Directors
    • Accelerator programme participants
    • Funding competition judges
    • Events speakers
  • Doubling the targeted funding from LSE, donors, and investors
  • Specific gender focus in its international hubs
  • Proud winners of two national awards for inclusive innovations:
    • National Enterprise Network Award for Innovation in Education
    • National Enterprise Educators UK

Since January 2021, I’ve been serving as Generate’s inhouse Gender Equality Advisor, delivering regular training in its various accelerators, participating in events, supporting the staff in their day-to-day gender challenges and monitoring the Code on a regular basis.

This work could help provide other institutions and organisations with an example of best practice, demonstrating how gender equality and diversity can be created and what it takes to bring about sustainable and long-lasting achievements, namely:

  • Commitment from leadership
  • Clear and measurable strategy based on expert knowledge
  • Accountability

‘The work has allowed us to embed gender equality into the very DNA of our programming so that it is the default position when anyone in the team organises a single event or a new series of initiatives. Ensuring our various commitments are baked in from the get-go rather than sprinkled over as we go along, sends a message to our stakeholders – be that students or staff – of the importance that we place on the subject. That we walk the talk and that we believe fully that by doing so, change can happen.’

LJ Silverman, Head of LSE Generate

With these elements in place, and LSE Generate’s achievements so far, we are now looking to the next stage of growth and international impact by launching an investor’s initiative that will bring about practical solutions and commitment, based on founder’s experience, to address the gender gap in the venture capital (VC) industry.

Inaction enforces a masculine model

To recognise how crucial this work is, we need to understand that the public sphere at large, and the business world more specifically, has been designed in the image of men, and in many ways is still attentive to their needs and views. What we perceive as ‘normal’, is in fact gendered.

Our current world and the acute problems we are currently facing is a direct result of having the bulk of power, decision making and access to resources at the hands of one gender group, and often of one race and social class as well. To solve the tremendous challenges we are facing, we need everybody at the table.

The masculine image on which the business world has been designed is an old one. Not only that it does not match our progressive social mindset and the reality of the incorporation of women and LGBTQI+ persons in every part of the professional world, but also, in many ways it does not serve men anymore.

Therefore, the incorporation of gender strategy, policy and training in business schools and entrepreneurial programmes is vital to the creation of gender equality and diversity in business and beyond. If we don’t actively engage in this work, we are, in fact, enforcing a model that is not neutral, but masculine in its essence. By integrating this topic, we can build healthy foundations, instead of solving problems further down the line. Without it, serious problems are likely to come.

My work with LSE Generate serves as evidence of what can be achieved when working towards gender equality, and when diversity is taken seriously and addressed with strategy and accountability. Imagine what will happen when others join.

Gender policy applications for business schools

What does the incorporation of gender measures in business schools and entrepreneurship programme mean exactly?

  • Strategy – identify your own internal gender gaps (staff representation, pay, communication, recruitment, retainment etc.), then create an action plan based on measurable benchmarks
  • Policy and culture – make changes and create policies to address your identified gaps (for example, blind recruitment, quotas, longer paternity leave, flexi-work etc.), make them known to all stakeholder and have leadership set an example
  • Training – engage with facts, discuss the various causes for current gaps and trends, and explore practical solution that engage with the core reasons of these issues
  • Accountability – make your commitment known, review and report on your progress, celebrate success and address challenges to find new solutions

By incorporating gender measures into business schools and entrepreneurship programmes, we are doing much more than creating room at the table for underrepresented groups. With this work, we are building solid foundations on which we can move away from destruction towards sustainable creation. It is a work of hope.

Yael Nevo (She/Her) is a Gender Consultant and Founding Director of Gender Rise, helping companies and organisations achieve sustainable gender equality and diversity through strategy, policy and training.

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A better Business School for the world

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At France’s Audencia Business School, having a positive impact on society and the planet lies at the heart of its strategy. David Woods-Hale spoke to Audencia’s Dean, Christophe Germain, to find out what this means in practice

In 2021, Audencia Business School in France launched its strategic plan. At the time, the School’s Dean, Christophe Germain, said the objective ‘wasn’t to become the best Business School in the world, but to be a better Business School for the world’. 

The plan, which is called ECOS 2025 in reference to the Greek word for ‘our Earth’, is organised around four main axes, with the overarching objective of having a positive impact on society and the planet. It includes the creation of Gaïa – Audencia’s School of Ecological and Social Transition. 

The strategic plan carries an ambitious global vision, strongly influenced by its values of environmental, economic and social responsibility. Audencia set itself the task of reinventing its very model: to develop more virtuous ‘citizens of the world’, who share humanistic values, with the conviction of sharing a common destiny. The plan is for alumni to use their hybrid skills and capacity to innovate in transforming both business and society, and by working towards the common good on a planetary scale.

This interview with Christophe Germain seeks to find out more about the facets of the fresh strategy, and his hopes for his Business School at a global level. 

What are the biggest challenges currently facing international Business Schools?

Schools’ biggest challenge is to train future managers for jobs which do not yet exist, and which will require skills from several fields of expertise. This is why, at Audencia, we have developed numerous hybrid programmes.

How did the Covid-19 pandemic change your School for the long term, and what have been the most important lessons? 

The main lesson learned from lockdown, since the start of the pandemic, is that students’ experience on campus is irreplaceable, in the same way that international study trips are the only way for students to experience intercultural immersion.

Given the growing climate emergency, do you think businesses– and by extension, Business Schools – have a role to play in helping communities to respond to, and recover from, natural disasters?

Yes, absolutely, because Business Schools train managers who, through the future decisions they make, will have an impact on major societal issues, including the ecological and climate emergency. It is the duty of Business Schools to ensure that these managers acquire the knowledge and skills that will enable them to grasp the complexity of these issues and act upon them.

You feel strongly that Business Schools should not just strive to be the best in the world – but be the best for the world. Why is this worldview so important in the business education landscape?   

A Business School must contribute to the common good, whether directly through its research, and work with companies, or indirectly via the training of future managers. Business Schools can influence institutional contingencies, change organisational practices and commit to sustainability, and in doing so, define new ways of leadership that integrate economic, social, and environmental dimensions. At Audencia, for example, we have identified the following three challenges that will guide our strategic achievements over the next five years:

• The creation and use of responsible information and technology.

• The development and adoption of managerial approaches that promote inclusive organisations and societies.

• The design and implementation of sustainable business models and growth (with a focus on carbon neutrality objectives).

What underpins Audencia’s objective to invent a new Business School model, involving training ‘citizens of the world’, sharing humanistic values, with the conviction of sharing a common destiny?

Audencia’s ambition is to accelerate the transformation of individuals, organisations and society for good, to contribute to the restoration of major balances (economic, social and environmental) which are essential to the preservation of our oikos (the Greek root of the ECOS prefix which is the name of Audencia’s 2025 strategic plan).  

Could you tell us more about Gaïa – the first School launched by a Business School that is entirely dedicated to training in positive impact managerial strategies and practices, in line with sustainable development objectives?

Audencia has defined four strategic axes. The first is the creation of Gaïa – a School dedicated to ecological and social transition. This is an internal, experiential, and immersive School. 

All Audencia’s students will be trained there using teaching methods tailored to each programme via extra courses, learning by doing, career advice, entrepreneurial projects, and research projects focused on tomorrow’s challenges, with a focus on sustainable development issues. 

Gaïa will rely on a large network of experts and partners (NGOs, private companies, trade unions and public organisations). It will house an incubator and will also provide free training. 

Your objective for 2025 is for all your students to have hybrid skills that meet the needs of the market. What do these skills comprise, and how will you work toward this goal? 

Our objective is to turn Homo Audenciens (Audencia’s students) into managers with three types of skills: societal, behavioural, and professional. 

To this end, a ‘KEYS’ (Know and Engage for Your Success and Society) passport will be implemented. The KEYS passport will be based on the unique ‘Competencies For Impact’ (C4I) skills reference framework, and will formalise all the steps for defining, developing and validating the student’s career path.

Each project within ECOS 2025 will be created to maximise the School’s contribution at a behavioural, professional, societal and environmental level. Why is this so important to the world of business education and beyond? 

Business Schools must be actors of the societal transitions that are unfolding. If they are not, they run the risk of becoming, like the statues on Easter Island, the remnants of an ancient world.

The School will readjust its academic and research activities so the societal impact of the research will be measured against several aspects. Could you share some more information about each of these aspects and the importance of impact-centric research?

There are three main aspects. 

1. The creation and use of responsible information and technology.

Nowadays, there is an abundance of information in networks and servers about individuals, businesses, and countries. At the same time, the fast development of artificial intelligence (AI), Big Data, 5G, and so on, have a huge potential to impact our lives. They open up unlimited opportunities but also expose us to threats. 

In terms of cybersecurity, it is key to ensure the ethical exploitation and safety of everyone’s data and the ethical sharing of the benefits among all interested parties. An ethical framework must be built around the development and the impacts of AI, and managing the inequalities it can produce, as well as mitigating against the potential harms posed by big data, 5G, the Blockchain, and fake news. 

All these elements, and others, will deeply impact our future, and we plan to address them by engaging in a scientific dialogue and training on these issues, while producing research and pedagogy across disciplines. 

2. The definition and adoption of managerial approaches that promote inclusive organisations and societies.

Gender and racial inequality, social exclusion, and other impediments to a fair and equal society, are still present. Businesses need to evolve and consider the wider needs of societies. They must promote the interests not just of their shareholders but also of those of surrounding communities, employees, and stakeholders. 

Our research is strongly focused on these aspects and not only identifies the problems of inequality, exclusion or optimisation functions that are not sustainable, but also proposes solutions for inclusion, equality, and sustainable business models. Our research also aims to promote business structures and entities that share benefits more equally, and have clear objectives consistent with wellbeing, sustainable business and key performance indicators.

3. The design and implementation of sustainable business models and developments (in line with carbon-neutral objectives).

Here, we move from the strategic to the more operational aspects of business and the impact it has on society and the environment. To address the major challenges, we will produce work on the sustainable use of resources, neutral carbon footprint, general waste management, plastic pollution, hospital waste management, water waste management, sustainable supply chains, farming, and so on.

The gap between academic research and real-life solutions has narrowed in recent years, and top journals require research that addresses practical problems and most effectively helps policy makers and decisions makers. At the same time, they wish to have an impact on a wider audience and require information that can be easily understood and disseminated via both social and traditional media. 

At Audencia, we promote scientific dialogue in the context of research and support communication for the science community. We also wish to have our say in the wider dialogue with: 

A) the business community, via our chairs and the practical output they deliver based on scientific research results, as well as those involved in professional bodies, roundtables, joint projects, business audits, etc. 

B) society, by producing relevant research that has a direct and indirect impact, participating in task forces, public projects, and consortiums for the common good, producing reports for policy makers and organisations, observing, and working on societal issues including poverty, financial illiteracy, microfinance, gender inequality, corporate social responsibility, and so on. We also aim to promote and disseminate our research in formats that are accessible to the general public.  

Can you share any examples of the real-world impact that the Business School’s recent research output has had?

We are implementing a research project that aims to drive a paradigm shift on data protection and enable citizens to participate acively in their own security, privacy, and personal data protection, whatever their gender, age, or technology skills. 

The research outputs will be tested and validated through real-world large-scale user cases, involving 6,500 European citizens. It will involve three apps, for e-learning, e-voting, and e-health, that are also linked to potential future pandemic risks.

In 2020, Audencia launched a Multi-Capital Performance Chair. The Chair is creating a new accounting model which considers financial but also social and environmental capitals. 

The Chair has also produced reports that are being tested in SMEs, and participates in a European Task Force project to prepare for enhanced reporting that goes beyond purely financial terms.  

A research project on Social Impact Bonds (SIB) was converted into a think tank report, and the author of the report was part of the SIBs launch alongside French President Emmanuel Macron and the Minister of Economy. An online event for practitioners was also created with the French Agency for Environmental Protection (ADEME). Audencia acted as an expert interface between project leaders and ADEME, allowing for the launch of a dozen SIBs focusing on environmental protection and the circular economy.

Another example is a research project promoting efficient and circular water use in European Process Industries, fostering resource efficiency awareness and delivering integrated solutions for industrial applications to reduce waste to zero and overall water footprint. The results are being tested in six case studies involving eight industrial actors, six EU countries and one associated country.

Are there any other areas within the new strategy pertinent to the development of more responsible technologies, a more inclusive society, and more sustainable business models, about which you are particularly enthusiastic? 

We are actively working towards a more inclusive society. To this end we have launched two social outreach programmes that will help young high school students from disadvantaged backgrounds to become Audencia students.

Considering the importance of lifelong learning, what is your strategy for enabling continuing learning among your alumni networks? 

A project called Token is being launched to allow each of the School’s stakeholders to recognise the value of their contribution. Based on the Blockchain technology, this virtual device allows alumni, in return for their impactful actions, exclusive access to Audencia’s training programmes. 

What do you think sustainable leadership looks like?

Sustainable leadership is leadership that fully recognises its responsibility to society and the common good. Leaders with a sustainable mindset will be key to helping solve the societal and environmental challenges that the world is increasingly facing.  

Do you feel optimistic about the future of business, Business Schools, and the economy?

Yes, absolutely. Who could claim today to have predicted, anticipated, and been prepared for the current global pandemic? As the writer Albert Camus said, it is the lack of modesty of men which is to blame. Modesty invites us to show moderation, restraint, and humility in our assessment of ourselves in relation to the world. And it has been forgotten. The current crisis is first and foremost a crisis of equilibrium, which affects the way in which spaces, objects, living beings, people and so on, coexist in the world. 

For the ecological equilibrium to be maintained, the transition to clean energy needs to be accelerated and our natural environment needs to be protected. The balance between local and global dimensions also needs to be addressed, as it is essential to reconcile the distribution of wealth between countries. The balance between timelines also needs to be addressed; we must not sacrifice the future on the altar of impatience and short-term interests. 

Finally, the balance between the economy and society is fundamental because the development of the former (normally) feeds the latter, and the solidity of the latter is indispensable to the former, all of which must contribute to the harmonious development of society. The list is long but getting all these balances right is essential. This is the major challenge facing humanity  and it must be approached with determination and optimism. 

Audencia, through its new ECOS 2025 strategic plan, is committed to being a major actor in the transition towards these changes for the common good of society.

Christophe Germain is General Director of Audencia, and General Director of Shenzhen Audencia Business School in China. Since 2019, he has also held the position of Vice President of Business Schools at the Conférence des Grandes Ecoles. Christophe has been Professor of Management Control at Audencia for 19 years, and has also held the positions of Deputy Director of the Grande Ecole Programme (2002-2007), Academic Director (2007-2015), before becoming interim General Director of the School in 2016.  

This article originally appeared in Ambition – the magazine of the Association of MBAs.

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Money talks: Why banks must learn to communicate with ordinary people

European Central Bank at Frankfurt city riverside sunrise. Business Impact article image for Money talks: Why banks must learn to communicate with ordinary people.

If the public can be engaged in monetary policymaking, the impact will be powerful, says Chicago Booth’s Michael Weber. Business Schools can help by teaching future economic leaders the importance of effective communication between policymakers and the public, and equipping them with the skills to achieve that

‘The ECB needs to be understood by the markets that transmit its policy, but it also needs to be understood by the people whom it ultimately serves. People need to know that it is their central bank, and it is making policy with their interests at heart.‘

(European Central Bank (ECB) President, Christine Lagarde, 2019).

Central banks will lose their grip on inflation if they continue to overestimate how much consumers listen to their announcements. Inflation in the UK could rise above 4% this year and it sits at a 13-year high in Europe. In the US, inflation is at high levels too and it is leading the pack with rapid rises.

These figures took inflation watchers off guard and financial journalists and investors kicked into overdrive trying to predict what central banks would do to control it. But consumers – who drive inflation – seem unfazed, continuing to remodel their houses, indulge in retail therapy and spend roughly the same as they usually would on their food shop, as the Covid-19 pandemic drags on.

This disconnect between policymakers and the general public runs deep. Those in charge at the Federal Reserve System, the Bank of England and the ECB can no longer afford to sit in ivory towers making interest rate decisions that the public aren’t paying close attention to. Today, there is a need for a serious rethink regarding how central banks communicate with normal people, to ensure monetary policy remains effective.

Why communication matters and how we’ve tried before 

Policy communication has become a key measure in the toolbox of central banks worldwide, especially during times of low nominal policy rates, that ultimately determine the funding costs of banks, such as those that many developed economies have faced over the last two decades and will arguably face going forward. Traditionally, the focus on policy communication has been to guide the expectations of financial markets and professional forecasters and move longer-term interest rates even when conventional monetary policy is constrained because policy rates are already at their lowest level. The idea is that policy communication aimed at markets and institutions will then transmit to households and firms.

At the same time, though, recent research makes clear that monetary policy is simply not getting through to ordinary people – it’s too difficult to understand and frankly, not engaging enough. Ordinary consumers, who are often economically illiterate, simply do not understand the implications of policies. Most people’s perception of what the economy is doing is wildly different to what economic theory suggests, which reduces their reactivity to policy measures.

For these reasons, since the Great Recession, central banks around the world have recognised that in times of low interest rates, households’ and firms’ choices should be influenced by managing consumers’ beliefs directly through communication. Of course, a rationale for direct communication with households and firms also exists outside these special periods to increase the trust in, and the credibility of, central banks.

But despite all these good reasons to articulate policies in simple terms, central banks continue to communicate in a highly technical way, aimed mainly at financial market participants and institutions. The increased communication by the Bank of England with the public, for example, has not increased the general knowledge of the pillars of monetary policymaking since 2001. People don’t understand or follow policy announcements, instead they use the price signals they observe in their daily lives, especially from grocery shopping, to form their inflation expectations. Most households focus on the price at the petrol pump, or the cost of milk, to inform their views of the overall price pressure.

Solving these problem demands a rethink. Changing how communication is used as a policy tool will force, for the first time, central banks around the globe to understand the interplay between mass communication and policymaking. If the public can be engaged, the impact will be powerful.

The importance of trust and why it’s crumbling

Trust in central banks is important for both the credibility and perceived relevance of the independence of central banks, which determines the effectiveness of policy communication. The rising levels and acrimony of anti-market rhetoric can become a serious threat to central bank independence if the general public does not understand and support the policy measures central banks implement and if they lose their trust in these institutions.

One core reason for people’s lack of trust is the widespread underrepresentation of certain demographic groups on important policy committees, such as the Federal Open Market Committee (FOMC) in the US, or the ECB board. Indeed, my research has found that women and African Americans have the lowest levels of general trust in the Federal Reserve and its willingness to foster the wellbeing of all Americans. Other research shows that expectations of inflation and the unemployment rate are, on average, least accurate for these underrepresented groups.

To win consumer trust, central banks boards would do well to start looking more like the people they represent. Research has proven that people are more responsive to central bank messages when they come from people who look like them and that those same people’s expectations of inflation become more accurate as a result. It couldn’t be clearer that the time has come to move away from the sea of sameness in banking boardrooms – for the sake of our economies.

Getting it right – the role of academia

Academics have worked tirelessly to dig into the issue of central bank communication and research has thrown up evidence of some central banks already dramatically changing the extent and modes of communication with consumers. And yet, there’s still a long way to go.

Most people remain ill-informed about the general pillars of policymaking – they do not actively attempt to obtain this information, and their expectations about policy-related variables tend to be biased and vary widely. And, yet, a growing body of work also shows that to the extent central banks can pierce the veil of ignorance, policy communication with ordinary households can become a powerful tool to steer aggregate demand.

More must be done to understand exactly which style, which sender, and which type of messages might increase policymakers’ ability to reach consumers. Moreover, all these features might differ systematically across countries, demographic groups, and over time.

Future policymakers and advisors must be aware that the most carefully crafted message and policy is bound to fail if members of the wider public are not reached, do not understand the implications for the optimal consumption-saving decisions, or simply do not care.

How can Business Schools help?

Inflation expectations determine virtually all the forward-looking decisions undertaken by households, including savings and consumption decisions, wage bargaining, labour supply, portfolio choice and more. Many Business Schools, like the University of Chicago Booth School of Business (Chicago Booth), already teach students how to adjust their decisions with inflation expectations. Not only that, but students also learn what inflation is, how it’s measured, how to form their own expectations and from there, how to make wise financial and monetary decisions.

In macroeconomics classes, students can also learn how central banks formulate their policies and how they manage and control inflation. So, at Chicago Booth – and many Business Schools across the world – students walk away from these classes with an advanced knowledge of what inflation decisions by central banks really mean. But the same can’t be said for society as a whole. The missing link today is finding ways for central banks to reach households with their policies and communications.

One way Business Schools can help is through classes in marketing which can teach future central bankers and consultants how to design simple messages that are palatable to ordinary households and identify the right channels through which to communicate these messages.

At the same time, the interdisciplinary approach of Business Schools can allow future leaders to draw on the insights across many different fields, such as psychology, behavioural economics and  macroeconomics as well as marketing, to design policies that not only work in theory, but also reach ordinary households in practice through identifying modes of communication and message design that normal people care about.

Steps ahead

The crux of that matter is that ordinary people are the ones who ultimately determine the effectiveness of monetary policy actions through their consumption, saving, and borrowing choices – which makes them the most important players in this game. Central banks need to start recognising that fact and adopt communication methods that work for ordinary people – whether this entails advertising on popular streaming platforms or getting creative with social media. The Bank of Jamaica, which has commissioned reggae songs that communicate inflation, provides one example of an attempt to use alternative methods to reach a wider audience. Perhaps central banks around the world could take a leaf out of its book.

Academics are helping central banks along this journey with crucial research, but Business Schools have an important role to play too. By educating our future economic leaders about the importance of effective communication between policymakers and the public, and equipping them with the skills to achieve that, we can ensure that the central banks of tomorrow don’t risk losing their grip on inflation.

Michael Weber is an Associate Professor of Finance at The University of Chicago Booth School of Business.

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