Navigating a route for the 21st century

Nitin Nohria has just moved house. He is the first dean of Harvard Business School to live in the dean’s house on campus since Lawrence Fouraker was dean of the school in the 1970s.

“It was the only decision I made that my predecessors recommended against,” he smiles.

But for many on the faculty, it is a sign of commitment from the new dean to the Harvard community that sets him apart.

And it is a signal that he intends to take the school, arguably the most famous business school in the world, back to its academic and community roots.

”There was a deliberate intent in which (HBS) was founded and the dean's house was part of that. There was a feeling that this was a campus to which people would come to study and be part of a community,” says Prof Nohria, 48, Harvard Business School’s 10th dean and the first to be born outside the US.

“I always had the magical sense of this place.”

As he takes Harvard’s business school into its second century, at a time when many question the role of business schools, he is acutely aware of the role he has to play.

“We are at an inflection point as an institution” he muses, conceding that Harvard in particular, and elite management education in general, has some big challenges to confront. “The industry is in flux.”

The first challenge he identifies is the opportunity cost of studying on a full-time, two-year programme as the value proposition diminishes; second is that the MBA degree has become commoditised and is about “credentials rather than character”; thirdly there are other models challenging the traditional MBA.

Two additional forces at play he says are the increase in online learning and the rise of emerging markets.

“The growth in the industry is not in the US,” explains Prof Nohria. “There is a deep set of shifts that are happening in the industry as a whole.” He believes that this will be fundamental to the way Harvard develops. “We were a great American institution in a great American century. The next [21st] century will not be a US century.

“We [HBS)] still have our roots deeply embedded in the US economy . . . How will we be an institution that is as current in the world as it is in the US? We have to have a more capacious view of what the world is.”

His response to these challenges will be closely watched by others in the industry, who look to the dean of Harvard to provide direction for the industry as a whole, not just for the Boston school.

On the face of it, much will remain the same. Sacrosanct is the case teaching method, both as a pedagogy and a source of revenue for the school – HBS makes more than $8m a year through selling cases and it is the pedagogy that is emphasised by the dean.

“The case method has enabled us to be closer to how business evolves,” he argues. “I think the winning business school will be closest to how that [developments in business practice] unfolds.”

But there is still much work to do in building a global case base. Two-thirds of Harvard’s cases still focus on US companies, but that is a distinct improvement on a few years ago. And, points out Prof Nohria, Harvard produces more cases on Indian businesses than all the Indian business schools combined.

“To convert from US to global cases is a huge commitment,” argues the dean.

A US case study costs $10,000 to write and that does not even include faculty costs. An overseas case costs six times as much. But for Prof Nohria, case studies are the contribution the cash-rich Harvard makes to the business education industry as a whole.

“We have this extraordinary moment to invest in creating a global knowledge base. This is the way in which they [other business schools] want us to be leaders.

“I think of other business schools as being a distribution channel for us,” he continues, pointing out that the distance learning MBA provider, the University of Phoenix, is the largest distributor of HBS cases.

“My hope is that we continue to produce the intellectual capacity that others use.”

Central to that goal will be Harvard’s international research centres. At the moment there are six of these, but that number could rise to 10 or 12 says the dean. “Tomorrow we want to be in Nigeria or Turkey.”

In the past 10 years research in each of the six centres has grown 10-fold, he adds.

The centres could be used for so much more than research as Harvard extends its global footprint. “These research centres could be the basis of recruiting,” explains the dean.

US-centric was fine when all Harvard students wanted to work for US companies. “Now you have American students coming to me and asking me what is the best way of working in India . . . No one is going to do one job in one country for the rest of their lives.”

Harvard’s fundraising, too, is US-centric and the research centres could “help deepen alumni relations around the world”.

Although Prof Nohria’s aspirations are global, many of his challenges lead back to the curriculum. In particular he talks of changes needed in the second year of the two-year MBA programme.

“How can we make sure that the second year is competitive? This is one of the questions that we are addressing.”

Though plans are still sketchy, the school is considering more than the usual overseas study tours or consulting projects. Indeed, what Prof Nohria says Harvard Business School is looking for is the “next level of pedagogical innovation”.

Part of that, he says, will be to develop the method as well as the content, that will make a high-quality product that is replicable.

“What makes us so good at cases is that we have developed a method. Other people can teach it, not just the professor that wrote it.”

Developing replicable programmes that can be taught at scale is one of the biggest challenges facing every business school in the US, given the growth in the demand for management education, which is outside the traditional markets.

Prof Nohria has a very Harvard take on the situation: he says that it is Harvard’s role to teach those who have the most influence, such as those who have the ear of government.

“It is not meant to sound elitist,” he comments. “There are some people who can influence many people. Through institutional capacity they influence the work of millions.”

View from the top: Video interview; Nitin Nohria talks to Gillian Tett