Business School Dean Nohria Advocates “Radical Innovation”

A round-the-world whistle-stop tour promotes a message of change for business education.

Nitin Nohria, dean of Harvard Business School (HBS) since July 1 (see the Harvard Magazine profile here, with links to his research and publications), is circling the globe, meeting with alumni, business leaders, and the news media in London, Mumbai, Hong Kong, Shanghai, and San Francisco from July 26 to August 6. An early result of his outreach was a column by The Economist’s Schumpeter, who reported that “The new dean of Harvard Business School promises ‘radical innovation.’” In a column published in the July 29 issue, Schumpeter wrote:

HBS is hugely influential. The school is a training ground for America’s business elite: a striking number of the top office holders of Fortune 500 companies, including the heads of General Electric and Boeing, sharpened their skills and elbows there. The school is also the apex of the vast global industry devoted to teaching business. It sits on an endowment of $2.1 billion and employs some terrific thinkers, including Michael Porter and Clayton Christensen. It developed the “case method”—using case studies to teach students about real-world business problems. It claims to be the source of four-fifths of the case-study materials used in the world’s leading business schools.

The past decade, however, has not always been glorious for the school. Global business has been rocked by crises, from Enron to the financial meltdown. HBS, alas, played a role. Enron was stuffed with HBS old boys, from the chief executive, Jeff Skilling, downward. The school wrote a sheaf of laudatory case studies about the company. Many of the bankers who recently mugged the world’s taxpayers were HBS men. George Bush learned to be a “decider” at HBS.

On July 1st, a new dean, Nitin Nohria, took charge. His appointment suggests that the school sees the need for a shake-up. Mr Nohria is the first HBS dean who was not born in North America. He is also the first who has come to the job having said that business faces a “crisis of legitimacy” and that business education is at an “inflection point”. Mr Nohria believes that HBS is on the cusp of “a period of extraordinary innovation”. But what does he mean by innovation? Are his ideas sound as well as stirring? And what chance does he have of prodding a lumbering giant such as HBS in the direction that he wants it to go?

 The column then explored Nohria’s emphasis on education for both “competence” and “character,” and his “other great passion…for super-charging innovation at HBS,” based on his studies of business innovation and leadership to effect change in corporations, particularly in the United States during the past century.

Nohria’s ideas were further spelled out in the JRD Tata Memorial Oration, presented in Mumbai on July 29. There, he applied his major research findings—on corporate strategies focused on productive efficiency, customer satisfaction, and innovation—to the rapidly evolving economy of India since markets were deregulated in the early 1990s. In effect, Indian business performance since then—with some established companies adapting to heightened competition, and others collapsing—is a speeded-up version of American industrial and corporate evolution spanning more than a century. As such, the oration is a useful primer on Nohria’s broadest conception of business and leadership. 

In a Wall Street Journal “India Real Time” blog posted August 3, Nohria foresaw economic and educational challenges to the United States and to HBS. There have obviously already been significant challenges to 

American businesses…that had dominated the lists of the global top 100 and 500 companies for the entire Twentieth Century. When they started seeing companies from Korea and Japan on that list they said, "What are they doing on our list. We’re supposed to own it.”

If you take the long view of history, the great learning centers had tended to be co-located with the great economic centers of the world. If other parts of the world rise with economic prosperity, inevitably there will be great centers of learning that will develop, too, and they will become competitors of American business schools.

Of the global economic transition under way, Nohria said:

I think it will take some time for America and Europe to reset their anchoring point from dominance to being seen as part of a century of true global competition. But I don’t think it’ll be a decline in the West, it’ll be other people catching up, which will be good for people in America and Europe as well as these markets open up and consumption spreads.

HBS’s chief marketing and communications officer, Brian Kenny, is blogging about the trip.

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