Business school research – a key tool or an expensive distraction?

There’s no doubt that an MBA from a well-recognised business school is a worthwhile investment of time, effort and money for any ambitious manager or professional. As the only genuinely international business qualification it has a proven track record of opening doors around the world and of accelerating its holders’ earning power and promotional prospects. But it most certainly doesn’t come cheap. While there are plenty of schools, particularly in Eastern Europe, with less expensive programmes, a full-time MBA at a top US school like Stanford GSB will cost in excess of US $100,000.

Given the sums involved, any likely candidate for an MBA will be keen to find out exactly what their chosen business school will be spending their hard-earned tuition fees on, and exactly what they will be getting in return. Which is why many prospective students find themselves asking why so many schools devote so much of their resources to the production of academic research – somewhere between a third and a half of the total budget of a market leader like Wharton, for example.

According to Jenny George, acting dean at Melbourne Business School in Australia, one clear and measurable benefit is that the best researchers are often also the best teachers. „They tend to be more up to date, more engaged in their subject matter and continually enquiring about whether there are better ways to do things,” she says. „All this makes for an exciting and engaging classroom,” Another dean, Howard Thomas of the UK’s Warwick Business School, shares her view. „There’s a direct link between high quality research and high quality teaching, as long as that research is informed by the practical needs of managers in the workplace and the market place,” he says. „To produce the best research you have to be completely embedded in your subject and that results in a stimulating experience for students.”

However perhaps one of the most powerful arguments behind the need for research is that it bases teaching on solid fact rather than on unproven theories. „Managerial practice should be based on evidence”, says Melbourne’s George, „and research gathers evidence that leads to solidly based decisions about management practice. Without research we’re into the territory of ‘try it and hope it works’, which is most certainly not what our students want or expect from us. Consequently the kind of research business schools should be doing is bold, potentially long term and detailed, and almost certainly complex and rigorous.” Her view is backed up by Patrice Houdayer who heads up the entrepreneurially focused EM Lyon school in France. „Effective management is not just about the use of soft skills, it’s should be a rigorous discipline. That’s why we don’t just need to produce good research, we also need to educate our students in how to read it, understand it and use it in the workplace. Our people will always be looking for new ideas, new approaches, new ways of securing competitive advantage, and original research can help provide them.”

But just how effective is business school research in practice?. How many academics, for example, managed to predict the consequences of the hubris that overtook the financial services sector in recent years? NYU Stern’s Nouriel Roubini stands out here for his continuous warnings of a bubble set to burst, warnings which led the New York Times to award him the unfortunate title of ‘Doctor Doom’. However very few others were courageous or insightful enough to follow his example. But how much of this was due to a failure in research itself and how much to the relentless optimism of the times? „We were producing a lot of written research on the impact of sustained low interest rates, the reasons for past crises and identifying early signs of a bubble and we’ve since used our research as a base to advise policy makers on how to counter the downturn, ” says Mauro Guillen at Wharton in Philadelphia, „but all business schools got too excited about how things were evolving, and perhaps weren’t concerned enough about the way the financial sector was taking over the economy. Our graduates were benefiting from the strong market and consequently we didn’t allocate enough resources to foreseeing the crisis. What was needed was more informed research and policy making.”

Business schools, or at least the deans and directors that run them, are just as likely to be seduced by trends as the rest of us. However the continuing emphasis on high quality research is strong evidence that they are determined not to fall into a similar trap again, with ongoing benefits for both their students and the wider commercial world.

Matt Symonds is founder of SymondsGSB and the QS World MBA Tour. You can follow more of his business education coverage on Twitter and his blog.