Case for the prosecution

In a magnificent example of circular thinking, Bloomberg is reporting that Harvard Business School professors are writing a case study examining whether teaching at the school—which is famously, of course, exclusively via the case-study method—is adequately preparing alumni to manage risk.

 

The school, whose alumni include Stan O’Neil and Andrew Hornby, the men at the helm of failed banks Merrill Lynch and HBOS, is looking particularly exposed to the gathering criticism over business schools’ role in the current economic turmoil.  However, many professors remain perplexed at the flak coming their way, arguing that, by its very nature, the case study method imbues students with a sense of long-term risk. Most case studies taught in business school classrooms tend to be several years old. While this is often to the chagrin of students—who continuously complain about material being out of date—it does, in theory, discourage short-termism as MBAs get to learn the real-world outcomes to the corporate dilemmas on which they have been deliberating. The case, it appears, remains unproven.

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3 Responses to “Case for the prosecution”

  1. Robert Henry Eller Says:

    Stan O’Neill was “at the helm” of Merrill Lynch, not Morgan Stanley.

    Although, considering the results, which company Mr. O’Neill was at the helm of didn’t matter.

  2. Robert Henry Eller Says:

    On the topic itself: All the risk-management training in the world, in business school or out, is not going to sustain people in the face of temptation, greed and hubris.

    How many people who break any of the Ten Commandments haven’t been taught those commandments.

    Business School, or any other supposedly ethical teaching construct, will only ever, at best, communicate to people what they should do. Remember, education is about what is learned, more than it is about what is taught. Experience taught Mr. O’Neill that greed and hubris “punished” him with over $100 million in severance.

    I don’t think I’d give much credence to Professors who are perplexed about why the case study method does not prevent such behavior.

    By the way, when talking about glorious HBS alumni, don’t forget to mention George W. Bush. I’m always interested to hear how what Bush learned at Harvard guided his decisions as President.

    Also, here’s a fun little thought exercise: HBS has about 65,000 living alumni. Considering the cost of the Bush Presidency, “all in,” how much economic value did each of the other HBS alumni have to create, on average, so that the total economic value of HBS alumni in the world nets to zero?

    Using Professor Joeseph Stiglitz’ estimates on the cost of the Iraq war alone, about $3 trillion, each of those HBS alumni would have had to create at least $48 million in economic value to net to zero positive economic value as a group. That’s before attributing any of the financial meltdown and the bank bailouts to Mr. Bush.

  3. whichmba Says:

    Thanks for spotting the typo Robert – the blog has now been amended.

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