Modern managers need to think like detectives

Students must be taught to use evidence and experimentation to solve management problems

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For more than a century, valuable insight into leadership, logistics, strategy, human resources, finance and other areas of management and business has emerged from research conducted at business schools. Indeed, business schools and business academics are the source of many concepts and practices that managers use on a day-to-day basis. At the same time, as their name suggests, the primary role of business schools is to educate the business managers and leaders of today and of the future. And, in an ideal world, there should be a strong link between research and teaching, where first-class research from business schools and elsewhere quickly percolates through to the students.

The reality, however, is a little more complicated. Take the challenge of integrating research into the curriculum. Academic incentive structures invite research that is academically exciting but not necessarily practically relevant. Even where research has obvious application it is often not by design and at many schools there is no formal mechanism for identifying relevant research and ensuring it finds its way into the curriculum.

Business schools can do more here. If we want research to be relevant to business managers and leaders we must consult with those who have an interest in research outcomes. Whether it is cross-cultural management, human resources, business strategy, or another area of interest, we can ask managers in organisations, their clients and our students, what are the questions on their minds? What problems do they need solutions for? True, these may be complex, big picture questions, which present their own challenge as research is invariably a simplification of the real world. But we can break down a big picture question into smaller researchable questions, each providing a partial answer to the big question.

And to those calling for more relevant research, I do not believe all research should have immediately obvious practical applications. It would be a mistake to abandon basic research, as this can also produce great insight for practice. Take the research on heuristics — the mental short-cuts we take to speed up decision making. Much of this research has direct relevance for managers, yet early work on heuristics was not motivated by a desire to improve the performance of managers.

This brings us to teaching. When it comes to including cutting-edge research ideas, there is inertia to overcome. Professors often have many ideas for updating their courses, partly to reflect relevant current research, yet often those changes do not happen — be it because of workload or risk aversion. A change of attitude is required. Instead of “If the course works, why change it?” a better approach might be, “Even if it works well, let’s consider changing it anyway”. A healthy injection of creative destruction creates opportunities for progress.

Of course it is important that students acquire the appropriate knowledge on their programmes. There is a rich body of management knowledge, well established academic findings that should be and in many cases are taught to business students. However, as importantly, we can equip the business managers and leaders of the future with the tools they need to solve management problems themselves; to test ideas using evidence and experimentation. When managers implement promising solutions to business challenges, they are usually relying on intuition and emotion. If they get the results they hope for, they assume, rather than know, that it is down to their innovative approach.

Students can be taught to approach problem solving like management detectives, using evidence. If a manager wants to try a new approach, they define their expected outcomes and should then challenge their suggested solution through counterfactual arguments, asking whether expected outcomes would result if the new approach were not implemented, or if alternative approaches would also produce these outcomes. This is the basis of experimental thinking.

But experimental thinking on its own is not enough; experimental data are what is really needed. We teach this at HEC Lausanne, where students are encouraged to test their ideas. Through a practical experiment using randomly selected groups, two approaches to solving a business problem are compared — the old way of doing things and a new method. The results are often surprising and even counter-intuitive. It is a simple, but powerful process.

Although business schools try, they may not be able to teach the latest and most relevant research findings to their students. However, what is better than having students learn and consume research produced by others is to teach these students how to produce it themselves so that it is immediately relevant to their company.

The author is professor of organisational behaviour and vice-dean for faculty and research at HEC Lausanne, the business school of the University of Lausanne, Switzerland.

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