Management: Part of the action - not site unseen (CORRECTED)

CORRECTION (PUBLISHED 16 JUNE 1994) APPENDED TO THIS ARTICLE

HERE'S a pair of questions to test any business school academic or graduate. Can you name an expensive, over-supplied product whose suppliers and customers are deeply unsure about its value and specification? Would this product be on the crest of a continuing wave, or the slippery slope of decline?

The answer to the first half should be easy. It's the business school degree, the MBA. The second is trickier: business schools have boomed, their US numbers soaring by 23 per cent to 670 in a decade, and their graduates rising by a third to 80,000. But demand has softened, and the worth of MBAs and their training is being questioned - by employers and academics - more deeply than ever.

The questioning is nothing new: top managers have long bitten the hand they feed but, despite doubts, have gone on feeding, hiring MBAs in greater numbers and at greater salaries.

What is new is the argument that management has changed, but business schools haven't: that the age of the 'quants' - higher numerate analysts - is over, and the era of the visionary, multi-faceted, team-working leader who makes things happen has arrived.

Even if schools can build a better- fitting leadership suit, that won't end the controversy. Long ago, Reg Revans, a British professor who rejoices in his maverick status, arranged for 'action learning', in which students study real-life problems in other organisations and, most important, produce real-life solutions. That was seen as a threat by academics - rightly, because it challenges the need for a school.

Thus, 21 powerful organisations, ranging from BT and Marks & Spencer to the Civil Service and the Metropolitan Police, now belong to the non-scholastic International Management Development Consortium.

IMD began in 1979 by tackling the 'strategic awareness' needs of directors and senior executives: that seminar is still going strong, but was joined in 1984 by a programme aimed at senior people who needed broadening beyond their functional experience - and that's where action learning came in.

This senior executive seminar revolves round the issues that US business schools are now striving to include in their curricula - above all, the action-oriented management of change.

The live consultancy work uses (and tests) the techniques and approaches taught in the first week of the seminar (based in Switzerland to stress the international dimension). The student / consultants have worked on everything from professional hi-fi equipment to woodcarving and a cable railway.

The firms the students visit benefit in the usual way: for instance, one of the consortium companies let students into a Stuttgart factory - improvements and savings followed in factory operations and marketing. Several of the careers involved have flown higher since, which prompted IMD to focus on younger potential high-fliers as well: managers, specialists and administrators. They participate in action learning, with assignments occupying all but three days of a 'business management seminar' lasting less than a fortnight.

An MBA, of course, takes far longer: in some opinions, too long. The great Peter Drucker, hearing that a friend's daughter was going on the MBA course at Insead, the international school near Fontainebleau, grimaced and said: 'That won't do her any harm.' The friend protested that it was only for a year. 'That's why it won't do her any harm,' said the sage. You can, of course, learn far more in two years than two weeks, but that is not the point.

Action learning teaches, above all, the application of management knowledge in practical situations (without which, obviously, the lore is useless).

IMD's business management seminar does have a faculty: teachers work alongside the teams for one or two days, assisting in the initial definition of the project and the subsequent analysis, and challenging the findings. The whole idea is to equip team members with the skills and attitudes that they can apply in their own companies.

Does it work? In personal terms, the answer is clear: four-fifths of the 300-plus participants have won significant promotion - though their selection for the seminar meant they were already on the upward escalator. But 20 have become group or divisional directors after an experience that goes to the heart of the business school dilemma. As one participant said, 'For the first time I have been able to examine a whole company and understand the inter- relationship of different activities.'

At the Wharton school in Philadelphia, according to Fortune, 'professors from previously unrelated disciplines are co-ordinating lectures so that students learn to grapple with business problems in new, multi-disciplinary ways'.

The academics though, admit to uncertainty over whether co-ordination is actually being achieved. In contrast, the 45-plus firms, ranging from publishing to air-conditioning, who have received IMD project teams are thoroughly convinced, to quote one sponsor, of 'the value of action-learning live consultancy work'.

The most radical of the threatened business schools, the University of Michigan, is emulating this approach with a 'medical school' model that sends students out to get practical experience inside businesses. The IMD consortium is well ahead in this game. Its members - and the business school heretics - are plainly right. In developing better managers, action is where the action has to be.

CORRECTION

The article 'Part of the action - not site unseen' in yesterday's Independent was inadvertently attributed to Roger Trapp, but was written by Robert Heller, founding editor of Management Today and a leading management writer.