industry & research
campusreview.com.au
Closed for business?
Are we seeing the last days
of the business school?
By Ashish Sinha
T
he scrutiny on the value that
business education provides to
its stakeholders has intensified
globally in recent times. Gone are the
days when a 20-something armed with a
business degree could walk into a plum
role at a large multinational company
and command a fat pay packet. Instead,
a number of business schools have
already, or are considering, retiring the
once coveted full‑time MBA program.
Proponents of business education
point to the central role that business
enterprise has played in the prosperity
of nations, lifting millions of people out
of poverty and in turn creating a wealthy
middle class in many developing nations.
Detractors point to the narrow
discipline-based business curriculum,
and research far removed from the
multidisciplinary nature of the real-world
problems that often present themselves
to managers in their working life.
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Worse still, the narrow focus hinders
business education to have impact and
be valuable to society at large. Rigour
trumps relevance in research at most
business schools, and many would
argue that the dichotomy between
rigour and relevance is leading to the
obsolescence of the business school.
Furthermore, a plethora of online
providers are disrupting the higher
education sector, forcing universities
to rethink their current business
model and delivery mode.
But what does it all mean for business
education in Australia? If higher education
– and by extension business education
– is being disrupted and not keeping
abreast with the changing times globally,
this would surely mean obsolescence, or
worse, complete annihilation. What will
business education look like in the future?
While these may seem like simple
questions, peering into the future is a risky
business. But trying to predict the future
when the institution of education is amid a
digital transformation makes it that much
harder. The clue, in my opinion, is to look
to the history of business education to
better understand the various forces that
have played an important role in shaping
it into its current form. This knowledge will
allow us to better understand the changing
environment that business schools face
today, and what role these forces might play
in shaping the future of business education.
The history of modern-day business
education started in 1880, when
wealthy businessman Joseph Wharton
made a generous endowment to the
University of Pennsylvania to assist in
the establishment of the first business
school: the Wharton Business School.
Wharton believed that a professional
business school housed within an Ivy
League university would provide the
discipline the legitimacy it deserved. The
focus of the institution was to provide a
highly practical and applied education to
its students, who were trained to become
business leaders. The next 70 years saw a
number of business schools established
at various universities in North America.
The same era also saw the birth of the
AACSB network, which in those days
was called the Association of Collegiate
Schools of Business, an accreditation
body specifically established to provide
educational accreditation to business
schools that met a certain quality standard.
Business education underwent a seismic
change in the 1950s, brought about by
the Ford and Carnegie foundations, which
wanted business education to become
more in line with the education provided
to students in the relevant basic disciplines,
primarily economics and social sciences.
These foundations played an important
part in shifting the focus from professional
to academic (rigorous) education by
providing funding to facilitate the type
and nature of research and teaching
being undertaken by academics at these
institutions. So much so, institutions like
Harvard were dependent on foundations
for a quarter of their annual budget.
While this focus brought rigour to the