I've been MIA for a while. Speaking on MIA, if you like her music, check out Santogold. I've been flying under the radar, having spent a fantastic weekend in Boston, organized the London Business School Crossroads Art Exhibition, taken a macroeconomics exams and finished my organizational behavior audit with MyBnk (a non-profit). BTW If you are into pro-bono for non-profits, I highly recommend these articles:
- The new landscape for nonprofits. By: Ryan, William P.. Harvard Business Review, Jan/Feb99, Vol. 77 Issue 1, p127-136
- Organizational lessons for nonprofits. By: Hauser, Jerry. McKinsey Quarterly, 2003 Special Edition Issue 4, p60-69
The art exhibition (sponsored by my summer sugar-daddy, Nomura) was well-attended and the open-air concerts (violin, viola, harp, flute) performed by students from the Royal Academy of Music were simply mind-blowing. We had rented a grand piano, and it was great to hear the quad fill with notes from Rachmaninoff, quite different from the usual corporate buzz-buzz. Dean Andrew Likierman inaugurated the exhibition. This was the best two months that I've spent organizing an extracurricular event. My role was Veep of Sponsorship, and Senior Veep of Jack-of-all-Tradery and Event-managery. Incidentally, I'm doing the same role for the London Business School Healthcare Club, in preparation for the 2009 Healthcare Conference. GSK chief, Andrew Witty will deliver the keynote.
So you may wonder if I ever study, given all my travels and extracurricular involvement. The simple answer is "No". And does that mean that there is a mad scramble and all-nighters before exams? The answer is "Yes". The truth is that, this is what works best for me. And no matter what your study style in B-school, it is relatively easy to get an A, curve notwithstanding. And then again, with grade non-disclosure, often people don't care enough. I just don't agree with most of what is being taught in my Operations and Strategy classes anyways – it is outdated and impractical in the real world. As for Macroeconomics – spend 2 days quality time with a good text book, read the Economist and read whatever Goldman Sachs and McKinsey's chief economists put out, and you're golden.
McKinsey Managing Director Ian Davis on "What society expects from business"
The B-school experience, coupled with the Macroeconomics class, and McKinsey chief Ian Davis's talk, and a question I was asked in a consulting interview "What reform is needed in the educational system, globally?" (I had to spin tales for 45 minutes) prompted some deep thought which I intend to convert to a white paper at some point. But here are the salient points (below). I'd love to hear your opinion on it (email me at email@example.com)
1) Professional degrees must be shortened in order to return high-GDP producing individuals to the workforce ASAP. Case in point, doctors, lawyers, MBAs and PhDs. The advanced professional degree educational system is outdated and programs are too long. A combination of self-study, online courses and modular/block weeks, with a greater emphasis on internship time is what's required. Think of your own MBA experience. Wouldn't you rather be out making the big bucks, ahem!, increasing GDP earlier. And, especially for PhDs and doctors, with the internet, data-mining, rapid technology upgrades and better predictive/computational/hypothesis defining/problem-solving tools, it should be easier to get done in 3 years, no more. People entering these degrees are arguably smarter and better informed today than their peers 20-30 years ago, and we aren't futzing around with Bunsen burners and conceptual quarks and anti-quarks as in years gone by. Besides, not only is there an opportunity cost associated with keeping people out of the workforce, there is actual value-destruction, as people lose motivation towards the latter stage of their advanced degrees. Ask any fifth year Theoretical Physics PhD or third year medical resident about regressing motivation. And, think of this point and the next one, especially in the light of women, child-bearing years and glass ceilings. Wouldn't this actually make things easier, or at least give them the option? Would it? I'm asking.2) Ditto for four-year colleges. Split the four years into modular elements so that students can intersperse longer internship spells in between to really understand what they want to do vocationally. Imagine a four year program, where freshman year is when you are 18 and senior year ends when you turn 25! I started off as an engineer, then biotech startup researcher/product developer, only to find that I wanted to be a strategy consultant, and now I'm going into investment banking. And I'm not atypical. More than 75% of my MBA classmates are career changers, onto career number three. How many of us started wanting to study choral music only to find that we really wanted to do few years later was law or underwater basket-weaving? In the meanwhile we futzed around in school or meandered from job-to-job. In other words don't put the horse before the cart.
3) Instead of useless subjects, teach people the following early on in their educational experience
- How to leverage their brains fully? How to deal with failure? How to find happiness? How to deal with metal pressures? There is a huge body of recent research that suggests that we as humans do not fully understand how and why we think a certain way (nature + nurture). Hence books like 'Stumbling on Happiness' and 'The Paradox of Choice'! After all isn't it about life, liberty and the pursuit of happiness? Our mental and emotional map is still very primitive, and lags behind the pressures and pace of post-post-modern lifestyle. The solutions this new research suggests are not your grandma's Freudian lying-on-your-shrinks-couch bullshit, but solutions grounded real facts based on fool-proof experiments, double-blinds, cross-referenced with MRI/CT scan data. Don't we want everyone to live richer, fuller lives? And bonus - from a capitalistic perspective this understanding helps sell stuff and from a welfare perspective it helps solve problems (Read 'The Tipping Point', 'Freakonomics', 'Supercrunchers', 'Fooled by Randomness' for evidence).
- How to interact with people, empathize, connect and collaborate. Friction between humans and the inability to snap together like LEGOs and work cohesively are will be the most significant value-destroyers in upcoming years within any organization. See Ian Davis's view on this. How many times do you wish you had insight into a difficult co-worker's mind? Why should good interpersonal skills only be the forte of salespeople and schmoozers? How much does this affect the potential of people who are unable to overcome their social awkwardness? What, are we living in the stone-age, where lousy interpersonal skills impact both individuals and corporate/citizenry well-being? (Read 'Extraordinary Relationships', 'Fierce Conversations').
- How to find the right mate? Even as it is, one could argue that divorce is a welfare value-destroyer. It is as welcome as a root-canal. And it is definitely an economic value destroyer. Think of alimony or child-support as transfer payments (most feminists and child-advocates would love to scourge me for this). And, not being able to understand what a potential partner would want, defers the mating process (not sex, but confluence), potentially reducing individual happiness (not the happiness associated with a stable partnership, but not being able to fully focus on what makes the individual happy regardless of the relationship). And, ask any joint-tax-return-filing married couple. Less tax equals more savings or consumption which equals more growth of national capital stock which equals more GDP and welfare growth.
- Teach people how to learn, think and evolve vocationally. This is especially important for developed countries with offshoring and outsourcing. Case in point, Adam Smith vs. theory of comparative advantage. Help people learn to evolve and develop new vocational skills. I have been lucky to have "learned to learn" and to evolve from engineer to researcher to consultant to banker. But this should not be the privilege of a few. Teach the masses to fish…..
- Teach people to learn to become efficient and drive local Leaness. Everyone on this planet simply needs to learn to live Lean. Lean is not just for making cars, but as the population grows and people in emerging countries learn to consume more, we need to understand how to eliminate waste and conserve resources. Plus, one of the biggest reasons that jobs flow out rapidly from one country to another is loss of productivity. And the reasons why companies like GM go bankrupt is because people aren't thinking daily "How can I make my environment more efficient and less wasteful?" (Read 'Lean Thinking' by Womack and Jones). Also training is passé. Its important for both managers and leaders to be able to coach their reports. (Read 'The Coaching Revolution').
- Similarly teach people fiscal and personal finance concepts much earlier in life. The reasons are self-evident.
- Obviously, none of this can be forced down the citizenry's collective throat, given the personal nature of issues at hand, the issue of free will, and given that no government or educational system should be as totalitarian. I suggest a gentler kinder approach where the people are made aware of what they are missing out on and why this is important. Most rational human beings will see the value in this.
Well, that's enough pontificating for now. I need to get cracking on my Corporate Markets and Finance final. And then on to reading, 'Damodaran on Valuation' in preparation for my Nomura summer internship. More later!
Excerpt from McKinsey's Ian Davis: Maximizing Shareholder Value Doesn't Cut It Anymore Published : November 01, 2006 in Knowledge@Wharton
……..Fourth on executives' minds is organizational capability. Talent is only one component of capability. "If talent is not trained or relevant to the task at hand," it won't have an impact, he said. Capability comes in many forms: emotional, psychological and intellectual. Sometimes even physical capability is important in business. "Intellectual can be dominant, but often human capability, like the emotional stability to deal with stress, can, in certain circumstances, be crucial."
In most companies, talent is misdirected close to 70% of the time, according to Davis. Often the mismatch between an employee's capabilities and his or her assignment is most obvious from the CEO's vantage point. One CEO told Davis that his main job -- his definition of strategy -- is matching managers' capabilities to the work that needs to be done.
Davis was asked how companies should balance matching individual capabilities with specific tasks, and still be able to develop management talent when new challenges arise that might be beyond an employee's capabilities. He said it is possible to do if top executives have a clear strategic view of what they need and a sense of the people who could ultimately fill senior leadership roles. Then top management should be prepared to invest in those people and tolerate some mistakes.
Business today, he said, is unwilling to accept any degree of failure, even small mistakes that might help future leaders avoid catastrophes in the long run. "We're in a culture that says, 'If you fail, you're gone.'" He argued that most people learn more from their mistakes than their successes. Often CEOs are fired for a mistake, just as they are becoming strong and wise executives. "It's tragic," said Davis. "My general experience is that if you have highly capable, motivated people in the right place, most other problems go away."
The "Usual Suspects"
How do these themes bear on leadership?
Davis said one word captures what is necessary: diplomacy. He defined diplomacy in the business context as "the ability to influence events through the force of personal and moral character.... I think business, NGOs (non-government organizations) and public sector leaders are all going to have to learn the useful skills of diplomacy to explain in a positive way what they do and why they do it."
……..Davis stressed that the issues he focused on in his speech go beyond the "usual suspects" of CEO concerns -- such as costs, corporate structure, customer relationships and strategy. "These subjects matter a lot, but they're starters. You've got to get them right." Even companies that do get the "usual suspects" right don't necessarily thrive, he said. To differentiate themselves in the future, companies will need to build strategies taking into account the larger themes of society and government.