Sport is global business with soccer arguably its biggest sector. Football clubs are listed on stock exchanges and their managers are scrutinised as much for their results as their leadership skills and business acumen. Business models are used to explain success and failure.
It is therefore no surprise to discover that business schools follow the sport closely. After being the subject of a study by Anita Elberse, a professor of business administration at Harvard Business School, Sir Alex Ferguson, manager of Manchester United, addressed the school’s students in December about his management style and what it takes to be successful.
This interest from business schools could perhaps be explained by the fact that they and clubs share many characteristics: some schools dominate the rankings year after year in the same way that football clubs do in their leagues; some schools have large endowments, while others struggle with debt. Business school deans could be considered as head coaches, with teaching staff the players and alumni networks the fan clubs.
The Wharton school at the University of Pennsylvania and Harvard Business School could be viewed as the equivalent of Manchester United and Arsenal in the English Premier League. Both schools and clubs have been ranked in the top five in all editions of the FT Global MBA ranking and English premierships respectively since 1999. For those counting scores, Manchester United leads Wharton by eight titles to seven.
In the football world London Business School’s equivalent would be Chelsea, both topping their respective rankings three times. Ceibs would stand in for Manchester City, recruiting some of the best teaching faculty and regularly ranked among the best business schools. Outside the UK, Spain’s Iese Business School is to IE Business School what Barcelona is to Real Madrid. Italy’s SDA Bocconi and Politecnico di Milano School of Management are the equivalent of AC and Inter Milan.
In the same way as football clubs, schools with the largest revenue and/or financial backing outperform their competitors. While clubs increase the size of their stadiums, schools increase the size of their campuses. Columbia Business School’s $600m building project is arguably comparable in ambition to Barcelona’s stadium, the Camp Nou.
In contrast, smaller or less prestigious schools find it more difficult to raise revenue. The endowment of the poorer schools totals only a tiny fraction of that of the richest. Small alumni or fan bases affect fundraising.
Deans have to manage the school and teaching faculty in the same way that head coaches manage their players. They have to win the respect of their teachers and in particular of their star professors. They face strong competition from other schools for the best teachers and those staff who are unhappy vote with their feet.
Schools recruit overseas just as much as football clubs: 40 per cent of teaching faculty among the top 100 MBA programmes are international compared with more than 50 per cent in the English Premier League. Schools’ PhD programmes are the equivalent of clubs’ football academies.
Deans’ performances are certainly less publicly scrutinised than their football counterparts. However, poor performance can lead to dismissal, and “changing-room” discontent to resignation. While some deans, such as Paul Danos at the Tuck School of Business, stay in post for a long time, half of the deans at the top 20 schools have been at the helm for three years or less. That is still longer than many football coaches, however.
The best business school teaching faculty and researchers are the Lionel Messis and David Beckhams of their profession. They command higher salaries and are sought after by many other schools. Some spend their whole career in one school, others move regularly. Faculty have their own transfer window in the summer. There is no transfer fee, however.
Finally, alumni networks and fan clubs promote the brand of their school/club and support it financially with donation/gate revenues and merchandising. Both alumni and fans believe that they belong to special and exclusive groups.
Football clubs and business schools, it seems, have much to learn from each other, although it is unlikely of course that any dean or coach will be swapping jobs. One final note: Arsenal fans, whose club has not won any trophies since 2005, should take heart from the fact that it took Harvard Business School eight years to regain the top slot in the FT Global MBA ranking, albeit under a new dean.