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In most fields, universities lead the way in innovation and new thinking. We expect the medical school to pioneer techniques or even the archaeology department to uncover a fresh way to look at the past. However, at business schools we struggle to keep up with the real world and often find ourselves debating issues and practices that have become obsolete.
Introducing sociopolitical elements into our MBA programme is our opportunity to leap ahead of business, rather than continuing to struggle to catch up. In the area of sociopolitical expertise, businesses have been incredibly slow to grasp the impact that social trends and public policy can have on their business.
The tumultuous events affecting financial institutions are affecting us all and it is clear that politics and public policy will be driving the solution rather than Wall Street. But how closely connected is the public policy department and the business school in major universities? Isn’t this a critical moment when business and public policy could benefit from some more intensive cross-pollination?
We have seen the re-emergence of local government control of key industries around the world – from oil and gas in Russia (Gazprom) to financial services with the nationalisation of RBS, Northern Rock and others in the UK and, of course, the gigantic bail-out at present underway in the US and just about everywhere else.
It started with financial markets and may soon include the automotive industry. And that may be just the beginning.
Add in the continuing tensions created by Hugo Chávez in Venezuela and Evo Morales in Bolivia and it becomes clear that managers need to be extremely savvy about how public policy – and the threat of government intervention and regulation – can impact on their strategies.
In Europe, the expansion of decision-making and regulatory power of the EU is not just freeing up markets, but also creating what Brussels perceives to be acceptable regulatory regimes across a continent of 350m consumers.
The latest phase in globalisation will focus on environmental technologies and their global diffusion. Government and society attitudes towards the adoption of new environmental technologies will be crucial to their successful adoption.
All of the above require managers to think within and across borders, not just in terms of trade and investment but also to anticipate the social and governmental impact of their strategies and tactics. And government leaders need to better understand the economic and business impact of their policies, both internally and across borders. So clearly a need exists, but how many MBA curriculums today offer political science, sociology, regional studies or history? It isn’t that hard to do. Most of us have the tools at hand, we just need to pick them up.
Few companies have the benefit of sociologists or political scientists in their midst to help them chart a course through waters that have become incredibly convoluted. We do have them.
Business schools need to do a better job in helping businesses develop a new breed of managers who can move in and quickly adapt to a local market regardless of their country of origin. We need to help our graduates beat the international manager trap that tends to homogenise differences with broad cross-border strategies.
The global versus local in marketing ended 10 years ago – the reality is that you have to do both. In business strategy, we also have to do both and business schools and multinational corporations are way behind on the local understanding part of the equation.
We need to start thinking in terms of a new breed of transnational managers that can easily move from one country to the next, or manage multiple countries at the same time. We need to build their capability to quickly assess the sociopolitical realities that will impact on the success of the business – for better or worse.
Paul Garrison is dean and professor of marketing at the Central European University Business School in Budapest
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