It was almost four years ago when IG invited to me explore the question of the Future of the MBA (with stalwarts such as Sreekant Datar, the Dean of the Harvard Business School among many others including Rishikesha Krishnan who is the Director of IIM Bangalore now. Industry, academia, thinkers, workers all had been gathered together to work through the question of how management education needs a complete reboot. You can watch that conversation online. Four years later, here are some thoughts and guiding principles that emerge that must guide the next twist in the road.
We have been re-inventing the MBA for over a decade, even as smaller B-Schools play catch up, the leaders have been trying to recognise that the old MBA has outrun its course. This was before the big Tech Disruption of the mid twenties. We are right in the middle of it now. So now, when AIMA invites me to speak about the Changing MBA, I have to reboot old conversations, but also rebuild the very essence of the response.
This, in essence is the truth of the MBA now – just the old will not do. Just like my response, the very nature of the MBA has to be rebooted and rebuilt. We live in a post VUCA world, which is even more chaotic and unsettling. The past decade has seen severe on businesses and consumers alike and this has shifted the way we do things. We like stability and predictability, but that too has gone with wind. The big change has been steady with robots building our cars and sweeping our floors but we were convinced that they could not really match us in language or insight for decades to come.
The launch of ChatGPT (now called GPT!) suddenly broke open the floodgates of LLM models that delivered AI in ways that we had thought was decades away. New launches happened every week after that, and soon updates were flooding us every day across produces, each improving upon what was possible yesterday. If a week ago, I could shake my head and say AI models cannot write a story, today they do. A perfectly adequate one. A movie – rendered reasonably well, old fold tales told with video illustrations, a novella and examination answers, all followed. This was not the end. We now have AI agents who work to meet our goals, not just perform our tasks. Once these agentic AI become ambient (think Internet of Things equivalent, but with actual -sort of – understanding), then we shall clearly see the world of AI being normalised.
What does this all mean for Management, and therefore Management Education?
IDENTITY
Clearly, we are seeing a huge collapse of the need for managers, since not only repetitive tasks, but also patterned tasks can clearly be performed by these agents. An agent can design and operate a dashboard that monitors factory data and flag changes required. The factory itself could be operated by mechanical robots – and the foreman equivalent could be a series of machines. Where is the role of managers if not on the shop floor, nor at the aggregate analytical level? If decisions that optimise and smoothen manufacturing, then humans become redundant. The MBA clearly can, and may have to pass on this role to those who design and code such machines. Or include this in their new identity. Hold the thought, let us call it germ1.
Management has been disrupted in the white collar world too. The world that seemed inviolate in its air conditioned offices and fancy desks because it operated in the world of ideas and interventions. These were problem solvers, and of course accountants and analysts who provided the data the identified the problems first. The march of computerisation took over five decades for counting, then problem identification to be mechanised while problem solving remained in the man(person!) Domain. We see current developments in the world of algorithms creeping up to claim this space too – though it is extremely unreliable at this stage. Reliability, however is not a difficult goal, since reliability tracks conformity. Conformism is an easy path, as every lazy worker has found out throughout history. Indeed, conformism is how AI has developed, literally conforming to its learning data sets. There is no doubt that white collar jobs too are threatened, even the ones that solve deep problems such as consultants, lawyers and more. Just this week large firms including Goldman Sachs have predicted (again) massive job losses as it launches its own AI assistant to 10,000 employees.
What we are seeing is the redundancy of ‘man’ in management.
(I swear, I had promised not to use this phrase, but who can resist temptation!)
This is not new. This is still unexpected. We are not ready. We are working it, because the future will not be denied, ready or not.
It is the job of the MBA to make us ready to face the future, to organise it in ways that are profitable for humans. The MBA – as we have seen it so far – has responded to what it can see for sure. But has not jumped the gun in ways that are demonstrated by new intelligences. This is the crux of the debate really. Does one work with evidenced problems, be sure of the solutions we offer, and then teach them to our students? Or, on the other hand, do we anticipate the direction of change and throw our resources in teaching what may or may not happen? Any conservative academic would vote for the former, and in my humble opinion, would be wrong.
What has worked in the past may not be the right thing for the future. We are at that cusp of the old and the new where it becomes necessary to let go of what feels right and move on to what is useful. As every good manager of any business knows, having perfect information is a dream, we have to take action before we can be totally sure it is the right thing. The teachers of us business managers may need to heed this as we decide on the future of the business degree and the business of the management school.
The leap is large for management education. It has traditionally been rooted in building strategies based on predictions, building operations based on human resources managing other resources, building accounting that controls for variances and creating sales revenues based on promises…err… products. This is the world we called VUCA (Volatility, Uncertainty, Complexity, Ambiguity) when it was beginning to rock and lose its balance. This has become even more chaotic and so, as management educators we have a new term in place – BANI that stands for Brittle, Anxious, Nonlinear and Incomprehensible. I detest this term, because it reeks of defeat for management education. We train people to win, to start this way is to frame it as a problem that cannot be solved.
(Side note on BANI : When has business not been brittle, ask every entrepreneur! At least now we have a process for funding to IPO etc. that is transparent and accessible. Anxious is a consequence, it cannot be tackled without better diagnosis, we need to do better to define to overcome. Non linear is merely acknowledging reality – a necessary step away from reductionist models of the past few centuries. Incomprehensible is merely a cry for help. Anyhow, lets use the framing for now)
Pace, Time and Speed – Reversal of Process
We must acknowledge that management education too must face the future that is moving at a pace that is beyond anything they have experienced before. Just like any other product or institution, business schools too have to reinvent themselves before they are ready. The first thing they will get is disruption, and they will have to meet this disruption with old and new tools. Old tools such as creative destruction, balanced scorecards and more are available in their arsenal. They need to be dusted out and reconfigured for our new context. The ideas work, but the use cases are so different, that they will need to be worked. New tools do not come with guarantees – and management schools will have to learn to experience and teach the grammar of exploration in real time. This is in contrast to the more generic grammar of implementation, or running a business that is taught currently.
It is far away, we acknowledge, but far away used to mean decades earlier. Now it means 2-3 years. The planning horizon has crashed to six months, the action plan will need to be implemented in less than a year, and the product/course/theory you create and teach will have reached redundancy in three years. Apply the basic BCG matrix on yourselves, and the others that you have taught in your first classes, but now, recognise that you are talking in months. This new pace may be dizzying at first, but we have known this for about a decade now. It is on us to deal with this reality and not be fazed by the rapid redundancy and reinvention. This is progress – and we need to build the capacity to assess the quality and implications of this progress with equal speed and rigour. This is the new task of academics. This is the responsibility of B Schools going forward.
While B Schools should now be tasked with creating the tools to evaluate emergent practices, they will also have the responsibility of building techniques to reject those that are not useful to our futures. So far business schools have encouraged short termism – the quarterly share price is a great example of the harm done by being enablers of poor criteria for decision making. Going forward, short term decisions are left to algorithms. But the capacity to judge these needs new tools. The purpose of these tools is to put these algorithms to the test, to evaluate them on rigorous and sustainable criteria and to either accept them as the building blocks of the future or reject them.
Algorithms show up as process, and we are all now process evaluators not just outcome managers. Algorithms, even self learning ones such as AI tools, or even agents are not cognisant of their own consequences. It is Business and Management academics who will have to hold up the flag of consequences and build the tools to either accept or reject them. This is a complex interaction between ethics, effectiveness and empathy. While all three aspects have informed business theory, they have not been given equal weightage to the detriment of both people and the planet in the name of progress. Choice making remains the core, but this time it is choice of decision makers – your AI assistant/agent or another.
This will mean one radical reversal of process for academics and social scientists. While previously, theory used to follow practice, now theory will need to track the evolution of the process long before it has crystallised into practice. Most business schools seek to teach derivatively, this is not an option left anymore. They will be seen as impractical, or worse, detached from the new reality. For smaller business schools this may even mean tighter regional focus, or area focus in order to remain relevant. It will also need deeper engagement with the practice of business in ways that have been discussed for decades but never implemented. Now it will have to because it becomes an existential threat.
Reportage, Resonance and Regulation will be the three types of tools that will have to be developed rapidly by B School academics. In order to be teachable, this content will have to crash the time to rigour from 2-5 years currently to merely months. This is not something that traditionalists will approve of at all, and young academics will rightly fear being judged on their ‘guesses’ but there is no other way. They will have to convert their guesses or hypothesis to theory using the 3 Rs above as tools. Rapid reportage of practice in Industry is about relevant conversations in the classroom. Tracking resonance of a process across industries or firms replicates rigour for the emergent theory. Regulation is about values and ethics and will depend upon societal goals. These three discussions will form the core of the teaching and learning discussion in the business school classroom. This will be on a foundation of what used to be called theory and will now be called history. And will lead to the most important part of any new B School going forward – and that is Experimentation.
While B School academics will have to work the cycles and lanes of experimentation, B school graduates will be in the business of experimentation. If something is tried and tested, it would have been automated anyway. Humans, to still be a resource will have to prove themselves resourceful and deliver outcomes with no assurance that their effort will work. Once it works, and if it becomes reliable as a process, this too will be automated. Humans, our students, will now be in the business of delivering experimental solutions. We have already seen the advent of that with the rise of design thinking as a basis for building forward. Business school graduates will have to deliver far ahead of this and will need to be trained in the skill of building ahead in ways that lie somewhere in between design, experiment, speculation and troubleshooting.
Of Risk and Uncertainty
This will also mean a complete reworking of our understanding of risk and uncertainty change in the context of business school education. While previously uncertainty was placed on the outskirts of decision making by demarcating risk and its management within the domain of work, present times demand a change. Even the VUCA world brought uncertainty to the centre, our BANI world upgrades it to Incomprehensible. Business schools previously limited themselves to teaching tools of managing risk but are now not only expected to teach their students to navigate uncertainty but also incomprehensibility. This is expecting one to walk the tightrope on a roller coaster. Like it or not, that is the game in town, and it will have to be played. We will have to train and send players out into the field. This is truly a challenge for business schools who are themselves barely beginning to articulate their observations of the players on a tightrope on the roller coaster. How are they expected to teach students to work this out. Oh, did we remember to say that the rails of the roller coaster are not visible, this is in the dark, so we have no way of knowing which way this roller coaster will go next.
This is not the future, this is now. The tariff wars of 2025 are a live roller coaster that businesses and countries have had to navigate with no way of knowing which way things will tilt next. Neither rational nor behavioural economics explains this game of powers. We can assume there is a machinery, or some logical explanation but for ordinary players there is no way of knowing this. Information asymmetry is only one part of these games, unsettling the players is a new prong, as are others. The rules of the game are not visible, nor are the boundary lines. No wonder anxiety tops the list of first consequences because so much is predicated on algorithms which only work when the rules are constant. In a world changing shape, the old algorithms are useless, or dangerous, or worse. At the same time, these algorithms along with slow moving humans are the only thing reliable in such a chaotic world. This does not make it better, it makes it less responsive which might turn out to be a cost. Certainty is not an asset.
Certainty has only one advantage. It points in one direction and therefore makes action simple for the simple minded. There was a time when systems were designed to be simple, unidirectional and therefore scaleable. This is no longer true. Businesses are expected to be both scaled and sensitive, be profitable and benevolent, be avant and reliable, be disruptive and steady – and so on. They inhabit and create a world of so movement that certainty is merely an arithmetical illusion, a reduction of reality for our simple minds to comprehend. To go beyond the limitations of the human brain, we designed more and more complex mathematical models to trade, to finance, to sell and to operate in our increasingly complex worlds. The world we inhabit today makes the head spin, where even our mathematical algorithms seem to be outdated even as we redesign them to learn and adapt on their own.
This is where Business Schools will need to work with students not only on guiding the design of adaptive algorithms, but will also need to create adaptive and pioneering students who go out and create new tram lines. This will need a whole new breed of faculty, especially in the smaller business schools. If faculty is merely teaching from a textbook or replicating knowledge, then they are redundant since that can be done better with ed tech. The contribution of faculty as a guide, a mentor is useful but not enough. The faculty of the future need to be able to equip their students with the tools to chart the unknown, to be a pioneer and to be undaunted by the constant and continual iteration for progress. A woodpecker, a goldsmith and a bulldozer – at the same time, if you will. Or other multi modal complex combined archetypes as they emerge. For this, faculty will need to teach themselves how to be pioneer makers.
This is good news for business schools really. Because, as we learnt from the journeys to the wild west, it was not the gold explorers who made money, it was those who gave them the tools. Business Schools are now in the business of figuring out what tools will be required for the wilds we inhabit and delivering them in time. It is in the business of training their students in the conquest of the known made irrelevant and so rebuilt in the image of their experiment.
Empires in the Cloud
In a sense, this is the next phase of imperialism, since empire and conquest have proved to be great motivators throughout history. Business School education must create these empire builders, but the empires are those of the mind first and then possibly matter. The virtual worlds we inhabit online are but a start, one version. Other worlds of convenience such as online shopping, virtual dressing, worlds of transport on call virtually and so on are other empires that started with a mental model, then an experiment. These have disrupted old empires and kingdoms. We rarely see traditional bookshops anymore, nor small local tea shops. Amazon and chains have built their empire over the ruins of previous ones. Conquest, in business, is inevitable. The job of business schools is to train competent conquistadors – but with a caution. Conquest has often – maybe always – caused devastation. Can business schools create these people who recreate the rules, build new paths, create new models and still hold on to the greater good?
The challenge to business schools is literally this – can they send forth little emperors who care? Who can create and nurture? Who can build not just for wealth but for wellness, not just for the moment but across generations? Questions arise not just at the interface of mankind and machiine, but also at the interface of valuation and values. To discard what is good in the interests of great only brings us to the feet of the grand pygmalion in the desert.Will business schools be building monuments that fall, or forests that grow and sustain?
To do both seems impossible, and today, as we serve the great, the big, the now, the new and all that shines bright, we are simultaneously condemning ourselves to the shadows cast beyond the bright zones. To be aware of the shadow and of consequence too is part of the mandate of business and ignoring it only casts our futures into doom. This doom is so inevitable and visible now that the failure of B Schools has cast entire generations into gloom with utter despair for their futures. It is this, and similar consequences that lie at the doorsteps of Business Schools – integrity lies in solving for this too. To design only for the bright, ignoring the shadows cast is dereliction of the first order. This is the conversation we need to be having. Play whole or not at all. For if the empire builders you create cast long shadows, it shall swallow us all.
We have seen the first wave of these empire builders of our generation. The onus again is on the thinkers and philosophers of the business arena to design guard rails to protect the greater good. Great only succeeds when the greater good is sustained, or it seeds its own defeat. Business Schools now bear the responsibility for this too, if only in self interest for great businesses.
From Tinkering to a meaningful small start
So far, most B Schools have been tinkering at the edges of the new reality.
The questions that B Schools are asking currently are about simpler things. For some it is about the shift to online teaching and learning, and its impact on learning outcomes (and on their fees). For others it is about AI driven large learning models assisting students in writing their essays and examinations. Others are worried about edtech taking over their relevance, while most of course worry about their own financial security and seek to expand their revenue sources. Each of these is an existential question at some level, and yet, there is an inevitability to the march of science that makes it obvious that business schools will have to adapt to assistants and agents from the AI space, will have to learn from both their MOOCs and current ed tech to deliver more meaningful learning in the hybrid space, will certainly have to recognise existential threats to their very existence. To meet these, they must recognise the big questions and the small steps that will help them discover the responses to the big questions.
One, do not sweat the small stuff. If AI is the new reality, do not merely worry about cheating and copyrights. These are side issues that will take up your energies. These are obvious choices – the technologies are here and both professors and students will have to embrace them wholeheartedly. The bigger questions ahead of business schools are about recasting their very identity, about rejigging their own processes and clearly about seeding values driven pioneers not just value hungry imperialists. These questions are big questions but they emerge quite naturally from the interfaces between technology and the rising precariat – both served by those who are trained by business schools. In that sense, for the first time, business schools stand at the centre of the scales of justice and their tilt will shift the scales. And these business schools do so with the tools they teach.
While it is true that management of resources, strategies and goals have come from the world of war, it is equally true that organising, discovering, and exchange are the gifts of a world that works for better outcomes. Both sets fall in the domain of management. Not just that, business itself has gone through many phases of organisation, exploitation, scale, transnationalism, stakeholder recognition, sustainability, social enterprises and more. We have established that businesses can change their colours, and even ethos. Business Schools have had less reason to do so at scale till now. However, now they are at a cusp, and must reframe some basic tools to adapt ahead.
One of the biggest explorations that management schools will have to undertake is the reconfiguring of principles that have stood the test of time. The basics of the world of business do not change. These are pegs that we can be sure of and make a great starting point. For example, we cannot deny that the world of sellers will seek profit, which means they will seek to maximise their revenues and reduce their costs. This will not change. The world of consumers will continue to demand more and better value for their buck. The tussle between the two will continue to manifest in myriad ways but will eventually result in an exchange of value. These are basics, super basics. These are the only things we can trust to hold true across times.
Other things have shaken up the world, and will certainly shake up some old definitions. For example, the world of Disruption has given us many new business models. Paradigms even. It has shaken up many rules that existed and thus disrupted the world of rule making too. Now, while it has been very interesting and has given us great conveniences, the world predicated on disruption has caused a disturbance in the force.
For you see, for a business to be managed well, it needs to be driven by certain systems and processes that give it a core of stability, indeed replicability product after product. Each to be the same, and reliably so. This is what ensures that each of them is priced the same, is sold the same and thus creates revenues that can be aggregated. Even better, stable businesses are predictable, and it is this prediction of future revenues that enables us to do believable and usable valuations. In a world of disruption, predictions go for a toss, as does an understanding of true value. Either disruption can create value, but it is so unpredictable that the calculation cannot be relied upon. Or we stay in steady state, and be predictable, safe and in inevitable decline, for that is the nature of things.
Businesses have resolved this and business schools have met the challenge somewhat over the past thirty years but the conceptual paradox still remains – does one seek disruption or seek stability? What is a business school teach?
The questions a business school teachers are always so – existential, philosophical and ethical. These we engage in, and then disengage. What remains of business school learning are the basics, the tools we use. So, when we calculate the NPV, the net present value of a business, (or simpler, an EBITDA), are we taught to count the cost within business premises, or do we also include the cost to the air, water and community? When we establish our IRR or seek a certain threshold rate of return to cross, do we account for the terms of trade that disadvantage certain countries, or do we merely look at the sheets of accounts in front of us? To ask good questions is important, but our tools have taught us to limit our questions to the immediate here and now. We blinker ourselves and so have no sight of the harms we cause in the process of the value we seek.
The harms never remain out of sight though. Like all consequences, they come back to bite us in ways that we struggle to understand. Sometimes they create a BANI world – anxious, brittle, fragile, incomprehensible. This is where we go back to basics and remind ourselves, that at the simplest, management is about five things – Planning, Organising, Staffing, Directing and Controlling, But these words come from a manufacturing world. In today’s neurotic world we do things slightly differently. We reframe, and from that we rephrase.
To plan in an uncertain, brittle world is fraught. But we can do better now with technology and better quality information even if partial. We can map possibilities. If things are so uncertain, we cannot be sure of it, but we can list the top 5 probable outcomes and work those multiple pathways. We have no other choice really. Plan turns to probabilistic possibility mapping. This covers a lot more ground and gives us options to proceed.
To organise in a nervous, anxious world requires a whole other skillset. Resources include people who seek meaning and purpose above all else, but even more than that, now require emotional support to perform their best. An anxious world will lead to recognition of a whole other level of people skills, of relationship survival and of purpose driven motivational nudges. This is very different from the carrot and stick approaches still taught in textbooks. Organising other resources is much easier – especially now that it has become clear that the old world series of short supply chains must remain as a back up for the long supply chains of the mid to late 20th century. The fragility of supply chains is matched by the ethical and governance considerations that determine customer engagement. The world of organising now includes entire vendor chains and promises of integrity to the customer at the other end. Managment Schools are comfortable with some parts of these conversations, while others take a little longer to percolate to the mainstream o management learning.
Resilience as a foundation for entrepreneurship is often not part of traditional resource organisation but is clearly a vital resource in building a business. Reframing these in contemporary terms requires a short dive into geopolitics, sociology, psychology and so much more. This is where when things are shuffled around just right, value emerges. Stay with old paradigms and value is lost. Management education needs to mulch well through these in order to tell the difference between facet and facade – and then learn to manage these complexities with the nuance they deserve, not mere reductionist efficiency planners of the past.
Similarly, while the concept of directing things remains true, we reframe it to the more logical operative principle of adaptive dashboards managed by AI agents. At the same time, questions about the bounds and guards on these agents is a live question for management schools to begin to answer and for their students to demonstrate as they build better and more resilient systems to direct outcomes. The endgame remains the need to chart pathways for better outcomes, but for each context, and for each stage of disruption and desire, these are rendered afresh. For business schools to teach these possibilities rather than templated certainties would be a step towards a better managed future.
Control was the fifth of Fayol’s principle from the early 20th century when he roots of management were established. Control may be something that we have ceded at every step to technology, and yet it does not feature in the good manager’s playbook for the future. Control reverts to the adaptive dashboard, to the world of course correction, iteration, to the next opportunity and to the data analyst’s insightful disruption. For the new management guru, the mantra has to be more, for what we must teach our students is to Dare. To dare to radically redefine the offering, the industry, the resourcing and more. To dare to build an empire of the mind, to validate it and navigate it to business success. To dare to fail and then transform the failure to lessons and success. And overall, to dare to break the template, to dare learn beyond the book. And so, to dare to build for better.
This is the new responsibility of management institutions – to teach students to dare, with caring.
That is their challenge too, for both do not always coexist. Make these meet, resolve the paradox of these opposites, train multitudes to build towards this future where they coexist. Start with small steps, the definitions, the reframing. Step forward and evolve with the mongrels, the hybrids, teach as you learn, break the blinkers and show the shadows so that whole decision making can create better and less fragile futures.
The task has been set. Go on then, do.
Meeta W Sengupta 