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At Harvard Business School, Nitin Nohria Pushes Reforms on a Bankrupt Culture | The Nation

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At Harvard Business School, Nitin Nohria Pushes Reforms on a Bankrupt Culture

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A tree is known by its fruit, as the old adage has it, and the recent appointment of Nitin Nohria as the tenth dean of the Harvard Business School signaled the university’s belated acknowledgement that the fruit of its B-School branch is rotten.

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With 70,000 alumni in 161 countries, HBS boasts accurately that it has shaped the practice of business in every industry and country in the world. The school bears heavy responsibility for the global financial meltdown and the corporate culture that spawned it. About half of the thirty bankers summoned to the New York Federal Reserve in September 2008 to devise a rescue plan for Lehman Brothers were HBS graduates. HBS is not only a training ground for the elite and a model for other institutions, it is also the apex of a vast global industry dedicated to the teaching of business.

Nohria, who was born in India, making him the first dean of HBS from outside the Western Hemisphere, is an outspoken critic of management education and has been active in the promotion of business ethics for the past two decades. At a time when the degree has come to stand for “Masters of the Business Apocalypse,” he has argued for a managerial code of ethics, and led the controversial movement for the MBA Oath, a voluntary pledge that includes among other things a promise to “not advance my personal interests at the expense of my enterprise or society.”

Nohria says that his agenda as Dean will include “creating value before claiming value.” He’d like to see the school’s oft-stated mission to make a difference in the world expanded to include making a positive difference. Business, he believes, can be a “wonderfully noble” profession, and he hopes to restore society’s trust in business education.

Nohria is not the first dean to declare a major initiative to address misconduct in the corporate arena and cultivate the nobility of the MBA character. But I’m skeptical that he’ll succeed where previous deans have failed. Codes, oaths and curriculum changes won’t matter if HBS continues to deny the ethical flaws in the training of Harvard MBAs that nurture a culture of greed, rash decisions and disregard for the humanity of people in the workplace.

A realistic assessment of the outcome of an HBS education can be gleaned from the unforgettable comments of my business policy professor on our last day of class thirty years ago. Summing up he said, “We don’t teach business, we work on your minds. We don’t teach you how to be Harold Geneen; we teach you that you want to be Harold Geneen.” Geneen was a ruthless empire-builder who as president and CEO of ITT created the archetypal modern multinational conglomerate in the 1960–70s through 350 acquisitions. The professor’s summation was spot on. To become a Harvard MBA is transformational. It forges a new identity as a permanent member of the business elite.

The B-School’s training is designed to break down and remold in its image some of the world’s smartest, most energetic young people. It teaches students to want power and believe they deserve it. That result is orchestrated, not accidental. Surviving the psychological pummeling and unrelenting competitiveness at the heart and soul of the training leads inevitably to a sense of entitlement far removed from “ordinary” lives, a utilitarian view of colleagues and employees, not as humans but as “working capital” and, in the guise of rational decision-making for profits’ sake, a merciless attitude toward others judged to be weak. There is a lot of meanness built into the training intended to toughen egos day after day, and it works. In the classroom, any vulnerability elicits contempt, and that is fundamentally how the B-School fosters inhumane values.

My own class produced the hard heart of Grover Norquist, president of Americans for Tax Reform, who opposes unions, minimum wage, social security and public school education. Ralph Nader once said that at ATR Norquist created an atmosphere cold-blooded enough to “sustain icicles.”

HBS requires MBA candidates to make and defend over 500 decisions and “Plans-of-Action” through two years of case method learning that puts the student in the role of chief executive. The goal is to train leaders with confidence to take bold action despite intense time pressure and incomplete information. Valuing the decision above all, however, without careful examination of its ramifications, denigrates deeper reflection and trains managers to leap to shaky conclusions. In a world where corporations are too big to fail and MBAs become US presidents, the dangers of taking decisive action based on insufficient information with little regard for consequences are all too clear in the aftermath of the banking crisis and George W. Bush’s (class of 1975) debacle in Iraq.

Will the HBS community ever agree to disrupt the system that gives its members a disproportionate share of our world’s riches? Hard to imagine. As long as HBS cultivates, and global business rewards, elitism and overconfidence among quick-tongued, unreflective scramblers, the 26-year-old landing a $250,000 starting salary at a hedge fund will not be moved to question the ethics of his prize.

Does Dean Nohria have the courage to admit that HBS’s core methods produce hard hearts, superficial thinking and arrogance? Is he serious enough about nurturing competence and character to ease the callous competition in the classroom and introduce time for reflection? The new dean could break the cycle of greed by rejecting money-hungry applicants in the first place and halting the current flow of new-minted MBAs into the financial industry. Now, that would be radical, and that would make a positive difference in our world.

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