MBA: Public approval

Business schools are adapting their courses as the boundaries between public and private sectors blur. Peter Brown reports
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The Independent Online

Krishna Naik, 26, from London, has seen public service at the sharp end. He managed a call centre team in Sheffield dealing with council tenants wanting repairs. "If you're dealing with the public sector you don't expect it to be a smooth ride," he says.

Naik, however, considered himself a private sector worker. He was employed by a business outsourcing firm hired by a maintenance company, hired in turn by Sheffield City Council – a typical scenario these days.

Later, for another private company, he was a project manager dealing with investment banking. "I noticed a slight difference in style. But when it comes to dealing with clients it's fundamentally the same wherever you are," he says.

Naik is taking a full-time MBA at Cranfield and hopes to return to human resources, but at a level where he can make policy decisions. There, he may detect a difference between public and private strategies, though the boundaries – and rewards – are merging. We are now in a business climate, to give a dramatic example, where Ron Sandler, head of a nationalised company – Northern Rock – earns more than £1m a year.

Sandler has an MBA from Stanford Graduate School of Business, California, which has recently completely reshaped its curriculum. Some British schools, including Henley Management College, have done the same.

"It's a response to a huge change in the global business environment," says the college's Stephen Lee.

He points to new issues of corporate social responsibility, climate change, and a key change in financial underpinning of commercial and public sector activity. "Trillions of dollars will be spent on PPPs [public-private partnerships] in the next 20 years, much of it on infrastructure."

Henley once ran a specialist Masters of Public Administration (MPA) course, but abandoned it. "Tomorrow's leaders will need to be able to understand alternate cultures, strategies, ways of thinking and working, if they're to be truly effective," Lee says.

By contrast, Patrick Bishop, from Lancaster University Management School, is working on a new one-year full-time MPA course that will start this autumn (international fee £12,000, European fee £8,500).

His programme will combine the political and social science skills of Lancaster University's arts faculty with the business school's financial and HR experience. He is targeting both private and public sectors – most small businesses, after all, supply the public sector at some stage, and need to understand its mindset.

Bishop also points to the growing professionalisation of the public sector, a point affirmed by Thomas Ahrens, of Warwick Business School, which offers an established and successful MPA. In fact, Ahrens is looking at ways to offer MPA classes to MBA students.

"In private business the targets are well-defined but the MPA offers an insight into more complex public decision-making, with objectives that come from all sorts of angles," he says.

At Cranfield, Professor Sean Rickard regards all such specialist MPA courses as gimmicks, insisting that the MBA should always teach transferable skills. But Ahrens says the disciplines are different. Government agencies have tight service targets, for example, where private companies endlessly demand rising profits.

Public sector workers are still in a minority at business schools – the cost of MBA courses is one reason – but have a lot to offer. Eve Poole, who teaches public leadership at Ashridge business school, came from the NHS and took an MBA at Edinburgh University.

"A lot of the MBA curriculum is based on capitalist business models which are increasingly relevant to the public sector because that's where the modernising government agenda comes from," she says.

But she believes her NHS experience was also useful to the would-be entrepreneurs and consultants in her cohort.

"A business case alone isn't always enough," she says. "You need people who say, 'Well, first let's think about politics, how it'll play in the newspapers, integrity and values' – all those variables that make public sector business so complex."