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There has been a lot written about the rate of change and how the speed of change isn’t going to slow down any time soon. One of the impacts of this condition is the complexity of doing business in any industry or sector of society has increased. This complexity challenges every leader to develop new skills and capabilities for themselves and for their organizations.

A rapidly changing environment also adds an additional layer of costs on to every business – a cost not just of dollars but of time and potential. Each year businesses spend a significant percentage of their revenues providing training to new hires and retraining to existing employees. If business schools and MBA programs could provide a more relevant education it could save business billions of dollars each year in remedial and basic training costs and increase the capacity of business to deliver more value to their customers.

Five of the major causes of our rapidly changing environment are:

• Digitization
• Commoditization
• Prosumer-ization (people being both consumers and producers)
• Globalization
• Socialization

Each of these factors has also put significant amounts of pressure on educational institutions – and like their industrial counterparts they are scrambling to respond fast enough.

Blair Sheppard Interview

Last week McKinsey released an interview with Blair Sheppard, dean of Fuqua School of Business at Duke University. He says that traditional MBA education needs to change significantly in order to be relevant in this new era. Some of the highlights of this interview are:

• the number of social-entrepreneurs is going up dramatically
• the reason people want an MBA is changing (people are fed up with institutions and want to ‘fix them’)
• people want to create both wealth and legacy
• people need both conceptual and practical experiences

In that context he says business schools cannot meet the new expectations as presently structured. To meet these needs business schools

• need a larger context than just business
• need to provide a wider range of tools than just management tools (develop a broader tool kit)
• should be more than inter-disciplinary and be inter-scholastic
• should be connected to other schools (people should be getting joint degrees – like a law and business degree)
• should provide leadership skills, business skills, and other skills

Reducing the Time to Learn

One of the most insightful comments he made is something I’ve long thought necessary for primary and secondary schooling as well. He said, “the students should run the school.” He says,

If they aren’t given the opportunity to make mistakes while you’re actually working with them and to take leadership positions that are consequential but not life threatening, there’s no practice for them.

It makes practical sense that older, more experienced students can have a stake in the learning and development of younger students. Sheppard acknowledges it’s a bit strange to have students paying a large sum of money and then having them run things – but something like that has to be done.

One of the best ways to shrink the development cycle time of a learner is to shrink the distance between the concept and the practice. If all learning could be real time, in context, that would be the most ideal. We won’t get there any time soon however a recent issue of Chief Learning Officer Magazine has acknowledged they are seeing practical shifts taking place in learning and elearning methodologies in organizations now. These include:

• push back and a seeking of alternatives to compliance learning
• designable social networks (to add learning components)
• collaborative learning methods
• video and video annotated learning (youtube is already the second largest search engine in the world!)
• live video conferencing and webinars
• project based learning
• cloud based learning

These practices will be more prevalent in 2010 and beyond in the corporate training repertoire and should also find their way into business schools and other institutions of learning.

I think it’s a significant change for both training and development organizations as well as business schools to make learning relevant and in the right context – and not to separate the concept from the practice (or at least shrink that gap). Can they do it? and can they do it fast enough?

Strategic Planning vs Accelerated Decision Making

Another factor that should have significant implications on business schools and enterprise training & development is the need to improve the capacity of the organization to be flexible and accelerate decision making.

This recent article from the Wall Street Journal elucidates the need for businesses to continue to find more capacity for increased flexibility and accelerating decision making. That makes perfect sense as natural responses to a rapidly changing environment.

From the article, Walt Shill, head of the North American management consulting practice for Accenture Ltd., is even more extreme. He says,

“Strategy, as we knew it, is dead,” he contends. “Corporate clients decided that increased flexibility and accelerated decision making are much more important than simply predicting the future.”

In our experience the organizations we work with are finding significant value in combining their capability building and strategic thinking initiatives; so it’s more of an AND approach rather than on OR approach.

Strategy AND Flexibility AND Accelerated Decision Making

Which brings us back to business schools. I think they have their work cut out for them. Every institution of any size is experiencing the challenge of outdated structures and processes while at the same time being forced to change by the marketplace and the business and social climate.

Educational institutions are old, slow moving bureaucracies riddled with some of the same structural dynamics as large businesses.

Can they do it? Can they make the changes necessary to be viable in this new era? Time will tell.

What do you think?