Should I work for this company?

The summer is a time of endings and beginnings. We’re about to enroll the Darden Class of 2016,
among whom many students are looking to end one career path and embark on another. Alums I’ve been
speaking with recently, took vacations, found the time to stop and reflect, and confronted the itch to
change employers. And for the Darden Class of 2015, who have had summer internships, this week is
probably the closing act: companies will start to make full-time offers. About two-thirds of Darden’s
summer interns get offers of permanent employment from their summer jobs. Common to all of these groups is a fundamental question: “Should I work for this company?”  Let me help you reflect on this. [1]

How not to decide

Start by dispensing with some of the most frequently-heard—and worst—reasons to sign on, such as money, power, fame, convenience, or lifestyle. Mind you, these aren’t trivial; and a partner or mentor may place them at the head of the parade. But these considerations can prompt one to make a decision that seems justified in the short run, but that in the long run may be regretted.

Where to start

The way to begin is to start with a sense of purpose, or intent, or calling. As Stephen Covey once wrote, you must “start with the end in view.” For a few people, this “end” will entail a clear vision of exactly what one will be doing in a few decades. But for most of us, the “end” will amount to an intuition about the kind of impact one wants to make, the kind of legacy one would want to leave, or the help one would want to give to others. If you have a vision or intuition about your “end” in view, everything else will be noise. As the Psalmist said, “Without a vision, the people wander.” If you don’t know where you’re going, any road will take you there.

The guiding principle

If you address the question of where to work with the end in view, then you get focused on how to get there. This focus drives you to one overarching principle: You should go where you believe that you can you do your best work. Thinking in terms of one’s “best work” necessarily focuses on the impact of one’s life and helps to define priorities. I don’t mean to suggest that defining one’s focus and priorities is easy. But finding the signal despite the noise is indispensable to charting a course. Think about the implications of this principle:

  • Go. This begs you to reflect on how you will leave where you are now, and how you will gain access to the place you should be. Is now the time to go? Is your team depending on you to finish some vital work? Will you slam the door behind you, and leave bitter co-workers behind? Leaving well is one of the hardest challenges in a career.
  • Where. In what sense is your best work you contingent on a place? Is it a physical location, close to friends and family? A virtual space that grants you connectivity to people who amplify your talents? A spiritual space that gets you in the zone for great work?
  • You. Are you waiting for someone else to decide for you? You must own the issue. Are you straining over the decision because you simply don’t want to face it?
  • Believe. This takes courage. When you decide to work for a company you must embrace a lot of uncertainty about the industry, company, your supervisor, and even yourself. Have you thoroughly assessed all of these uncertainties? Some are certainly groundless. But there may be good cause for doubts, and perhaps some fears. Ultimately, to decide requires a stroke of faith. Some people gain that faith through serendipity, “signs,” or a feeling of being called, a nagging idea that just won’t go away.
  • Work. What is the work that you want to do? Like to do? Are prepared to do? Will this company let you do it? Or at least grow into it? And let’s not define “work” too narrowly. Your life’s work could also include serving a community, nurturing loved ones, or repairing some nagging interpersonal problem. Think about the balance of all of these possible demands over the course of your life.
  • Best. This is the most important word in the whole question. You shouldn’t settle for just any old work. Life is too short for that. One wants to have an impact with one’s life and arrive at a good end. The notion of “best” should trigger some deep reflection on how you define success. If you start with some sense of the end in view, your best work will start to define itself.

Conclusion

“You should go where you believe that you can do your best work.” Spoken plainly, this principle seems obvious, hardly a slap-the-forehead insight. Yet in my decades of working with students, alums, and searchers of all kinds, I observe how slowly people come around to this conclusion. Often late in life, they will wrap their career choices based on money, power, fame, convenience and lifestyle in some rationalization about “best work”–but it always sounds hollow.

It is better to start with the end in view. That way, the steps to get there tend to define themselves.

  1. Those interns who are in the home stretch and really hope to gain an offer might find some of my past
    advice helpful. There is a range of things one can do to improve the odds of getting an offer:

    A. Actually ask for the job. Too many summer interns simply don’t “close the sale” (see this.)

    B. Become known. “Lean in,” in Sheryl Sandberg’s parlance. Too many summer interns lean back and fade out (see href="http://blogs.darden.virginia.edu/deansblog/2010/07/a-question-for-summer-interns-who-are-you/">this.)

    C. Finish at a sprint; don’t coast to the end. Research suggests that the most recent perceptions are very influential to decision-makers. Even if you’re finished with your summer project, walk around and volunteer to help anyone else (see this.)

    D. Quell any sense of entitlement; you must earn the offer. In most settings, arrogance damages, rather than strengthens, career prospects (see this.)

    E. Even if the news isn’t good, exit gracefully. (See this.)

    []

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Why Explorers Matter

Today, we observe the 45th anniversary of the first moon landing (see this for details on the observance). The world justly lionizes Buzz Aldrin, Neil Armstrong, and Michael Collins for achieving a manned lunar landing. And Armstrong’s declaration, “One small step for man; one giant leap for mankind,” remains an iconic marker for the advancement of civilization in the 20th Century. The observance looks like a media event; and much of it seems to be about technology (rockets), big organizations (NASA), geopolitics (the space race), and national will (JFK’s aspiration to put a man on the moon). All of this strikes me the way I encounter anodyne restaurant reviews, political tracts, or economics theories: where are the real people in all of that? What was the experience of the whole team? With what did they contend? What can we learn from them that could be relevant to the rest of us on Earth in our daily lives? Ultimately, the observance asks a radical question: generally, why do explorers matter?

The obvious—but wrong—answer is that explorers matter most because of what they found. Don’t misunderstand me: what explorers found was important and changed history. But in so many cases, the odds seem high that someone else would have made the same discovery in the same era if the explorer we now celebrate had not done so. For instance, records suggest that Chinese Admiral Zheng discovered America in 1421 (see this). Was it a matter of luck to one and misfortune to the other that we today celebrate Columbus instead of Zheng?

I think we should celebrate explorers, but for reasons that transcend what they discovered. Let’s give more attention to the who and how.

First, explorers matter because they can illuminate attributes of leadership. The need for leadership in so many areas is so great today. Explorers can help to orient us to the kind of people the world needs. Mind you, great explorers in the past tended to harbor great flaws; these are not obvious candidates for sainthood. But consider what we learn from the story of Apollo 13, or from the early test pilots and astronauts profiled in Tom Wolfe’s The Right Stuff. Then, too, there is the remarkable story of Shackleton’s voyage to Antarctica, told in Alfred Lansing’s Endurance, and in Roland Huntford’s The Last Place on Earth. Explorers show us that great leadership is less about self-aggrandizement, risk-seeking behavior, or the determination to reach a goal at all costs. Instead, explorers show us the huge importance of team-building, careful planning, faultless execution, and courage.

Second, explorers expand our ambition. They inspire us to think beyond what is possible. How many young girls have been emboldened by astronaut, Sally Ride, to study STEM subjects and become explorers themselves? The song, Northwest Passage, by Stan Rogers describes a modern-day traveler seeking to re-create the trip of Sir John Franklin, who sought unsuccessfully a northwest passage through the Arctic Ocean to Asia—what moves the traveler is

“To find the hand of Franklin reaching for the Beaufort Sea, Tracing one warm line through a land so wild and savage,/And make a Northwest Passage to the sea.”

Finally, the experience of explorers matters because they show how to prevail in the face of great adversity. Indeed, in the experience of explorers, the adversity seems to be the main point. Montaigne said, “It is the journey, not the arrival, that matters.” We want to know how the explorers contended with the journey: the hardship, doubts, setbacks, and even success; we relish the stories of explorers because they show the rest of us how to go far away, and come back again. It is the return of the explorers that creates the example of testing the limits—in Stan Rogers’ song, “to find there but the road back home again.”

History teaches us that we worship heroes at our own risk. But what passes today for the celebration of a profound achievement in the annals of exploration misses some big points. Such commemorations need to bring us face to face with lessons about leadership, ambition, and adversity that the present generation can harness in its own outbound journeys.

***

The song, Northwest Passage, by Stan Rogers is well worth listening to this day, to give an alternative tone to the media event. The chorus of the song is:

Ah, for just one time I would take the Northwest Passage,

To find the hand of Franklin reaching for the Beaufort Sea,

Tracing one warm line through a land so wild and savage,

And make a Northwest Passage to the sea.

Other verses include:

Chorus

Westward from the Davis Strait ’tis there ’twas said to lie,

A sea route to the orient, for which so many died,

Seeking gold and glory, leaving weathered broken bones,

And a long forgotten lonely cairn of stones.

Chorus

Three centuries thereafter, I take passage over land,

In the footsteps of brave Kelso, where his “sea of flowers” began,

Watching cities rise before me, then behind me sink again,

This tardiest explorer driving hard across the plain.

Chorus

And through the night, behind the wheel, the mileage clicking west,

I think upon Mackenzie, David Thompson and the rest,

Who cracked the mountain ramparts and did show a path for me,

To race the roaring Fraser to the sea.

Chorus

How then am I so different from the first men through this way,

Like them I left a settled life, I threw it all away,

To seek a Northwest Passage at the call of many men,

To find there but the road back home again.

Chorus

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The Frontier of Technology and the Educational Experience

“We shape our tools. Thereafter, our tools shape us.”
— Tobias Kinnebrew, Bot & Dolly

The onrush of new technology into higher education is, to most academicians, both wonderful and terrible—not least for the reasons that Kinnebrew suggests: the new tools presage a different world and a different “us.” Now we have “Web 3.0,” according to Tim O’Reilly at a conference last month. O’Reilly is a technology publisher and commentator and the origin of the phrase, “Web 2.0.” What is this new Internet? And what does it portend for higher education?

Most likely this: more of the same, only more so. In previous posts, I have argued that new technology will accelerate the pace of change of higher education, that such change will entail a displacement of instructors and institutions whose material can be easily digitized, and that the emergent champions will be those who excel at digital delivery of knowledge, and those who excel at the delivery of superior in-person learning experiences—to be stuck in the middle will be very dangerous. Acceleration. Displacement. Polarization. My hunch is that “Web 3.0” will advance all of that.

The New New Thing

To refresh your memory, “Web 1.0” gave connectivity of the written word, such as email and blogs. It entailed narrow-band connectivity available through dial-up services such as AOL. Then came “Web 2.0,” which gave connectivity of video, music, and which required more bandwidth and the communication technology to process immense volumes of data. The Internet took on a two-way publishing model in which Internet users contribute content, rather than a one-way system akin to book publishing, in which Web site owners post and publish content directly for a separate audience to read—YouTube is the canonical example.

“Web 2.0” made possible asynchronous education such as Khan Academy and the “flipped classroom” now so popular in K-12 education circles. It also exploded digital instruction into higher education: MOOCs, hybrid program designs (that mixed digital and person-to-person (P2P) instruction), Skype-based learning teams, learning management systems such as Canvas, Cloud-based storage of records and materials, digitized books and case studies, and PowerPoint mashups of video, text, voice, animation, etc. What made all this possible was the growth of bandwidth, and the incredible decline in the cost of computer processing power and of storage of information.

“Web 3.0” is the “Internet of Things” (IoT), which recognizes that Internet connectivity extends well beyond desktop-to-desktop toward a host of different possible things: tablets, smartphones, smart watches, personal activity monitors (e.g. Fitbits), robots in manufacturing plants, and glasses (e.g., Google Glass). Sensors are growing in ubiquity and connecting to form intelligent systems based in the Internet. Tablet computers are widely distributed across military units in Iraq and Afghanistan. A new-model jet engine by General Electric contains over 100 sensors and generates over a terabyte of data per flight; these data are uploaded via the Internet to promote predictive maintenance (i.e., rather than maintenance that is purely reactive to breakdowns). Application software enables the individual person or the large enterprise to customize the engagement with the Internet. The torrent of data that descends on the service providers has riveted decision-makers on “big data” and the need for sophisticated analytics to enable even better provision of service in the future. What made all this possible is the near-zero cost of information storage, the spread of sensors that record the experience of humans, organizations, and things; the invention of hardware devices that achieve the greater distribution information generated by sensors; the development of apps that permit greater customization; and generally, the diminishing cost of innovation. The cost of experimentation with hardware and software is so low that design and development of new software and devices is being pushed out of large enterprises and into the garages, basements, “Fab Labs,” “hackathons,” and “Maker DIY.”

These themes about “Web 3.0” and IoT were explored last month in the Solid Conference, produced by O’Reilly Media. [1] The premise of the conference was that “Physical things—machines, devices, components—are about to experience a profound transformation. The Internet fundamentally changed how software is developed and deployed, and now hardware is on the brink of a similar disruption. Consumers, already carrying smart phones and driving cars that park themselves, have come to demand more from their objects than ever before. They expect their belongings to “know” them, to interact with them, and to adapt to their needs. Industry is realizing that smart networked machines can bring them the efficiencies and new capabilities to do more, faster, and cheaper…Hardware and software are fusing into a single fluid entity….this collision of software and hardware is fueling the creation of a software-enhanced, networked, physical world.” The “Things” form a more intelligent system rather than just a connection of objects. Hardware is starting to resemble software in its capacity to be edited, to adapt to changing needs; and software is starting to resemble hardware (e.g. smartphones don’t have buttons, they have icons on a touch screen). The result is increasingly intelligent information technology systems that are growing in their ubiquity, customizability, and sensing capacity:

  • Networked automation. Prompted by sensors, machines communicate with machines from the consumer’s point of purchase back to the assembly plant, back to the component fabricators, back to the suppliers of raw materials. RFID and GPS systems allow computers to track the movement of supplies from distant locations to sufficient precision that it gives new meaning to “just in time” management. Within manufacturing plants, processes are increasingly automated: machines monitor workflow, inventory levels, quality, and maintenance. Beth Comstock of General Electric calls this the “selfless machine: a machine will sense other machines and what the changing environment requires that the machine should do. No machine is an island.” And machines remove workers from dangerous settings: Rio Tinto described the use of mining vehicles controlled by drivers in the safety of a distant facility. These examples may seem unsurprising and prosaic, since mechanization has been a steady theme for decades. But what is notable today is the extent to which machines and information systems substitute for human interaction and to which humans expect their machines to anticipate their expectations. Reducing human intervention has proved to be a boon to users of taxicabs—just ask clients of Uber—or to people trying to transfer money—just ask clients of Bitcoin.

  • Synthesis of virtual and physical. Google, a software company, bought seven robotics manufacturers last year. In 2008, the number of devices connected to the Internet surpassed the number of people on earth. One of the most provocative examples of the melting boundary between software and the physical world comes from Autodesk, the software company. Carl Bass, the CEO, explained that DNA, or genetic code, is simply a physical manifestation of software. Extending the company’s capabilities in software development, Autodesk has the ability to “print” physical DNA. Bass said, “the age of synthetic biologic manufacturing is right in front of us.” Is Autodesk in software or hardware or biotech?

  • Knowingness. Systems that can recognize a person’s individual identity can adapt to that person’s preferences. Inventors demonstrated systems that adjust household lighting, heating and ventilation. Similarly, systems can aggregate across many individuals to frame insights about mass behavior—inventors demonstrated a system that can distill exabytes of purchasing behavior from iTunes to graphically display the presence of jazz enthusiasts by district in a metropolitan area.

The Limit to Things.

How far will the “Web 3.0” go in displacing the work of humans? It is limited by its ability to produce transformational experiences, to generate high standards of craft, and to create ideas.

Experiences. At the end of the Solid conference, I took a hike. Literally. Backroads.com is one of the best active vacation tour guides on the planet and took me and six others on an exploration of some mountainous terrain along the Amalfi coast in Italy. Heart-pounding trail-climbs and descents. Spectacular vistas. The scent of wild garlic, rosemary, and fennel; the feel of wild orchids between the fingertips; the taste of homemade pasta, mozzarella, and cappuccino. What’s more, the experience was shared with the likes of a physician, two research chemists, a corporate manager, and two homemakers. We corrected one-another’s broken Italian, shared jokes, collaborated on load-bearing, map-reading, and direction-finding, compared perceptions about the surroundings, and challenged assumptions on virtually all subjects—it felt like a walking graduate seminar. I was transformed by the experience: new sensations and their synthesis into something quite impactful.

High Standards of Craft. Can “Web 3.0” define its own standards of excellence? Can it judge true excellence, as opposed to just “good enough” compared to some peers? A highlight of the Solid conference was a presentation by Richard Isaacs, who carries the title of “Organ Builder” at C.B. Fisk, a leading manufacturer of pipe organs. Each of these instruments is one-of-a-kind, a work of art. Isaacs asked, “What has changed in organ-building over the past 150 years?” Relatively little. A tracker organ connects keys to pipes by mechanical means which produces an extraordinary ability of the musician to “feel” the very complex instrument at work, in turn which enables highly sophisticated performance. Fisk’s instruments embody extraordinary craftsmanship.

Ideation. The new book, The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies, by Eric Brynjolfsson and Andrew McAfee of MIT, forecasts the increasing automation of “routine” tasks: “this leads to job polarization: a collapse in demand for middle-income jobs, while non-routine cognitive jobs (such as financial analysis) and non-routine manual jobs (like hairdressing) have held up relatively well.” (p. 139). The authors emphasize that the cognitive work that will fare particularly well in the increasingly machine-dominated environment will be the non-routine cognitive jobs:

We’ve never seen a truly creative machine, or an entrepreneurial one, or an innovative one. We’ve seen software that could create lines of English text that rhymed, but none that could write a true poem…Programs that can write clean prose are amazing achievements, but we’ve not yet seen one that can figure out what to write about next. We’ve also never seen software that could create good software; so far, attempts at this have been abject failures. These activities have one thing in common: ideation, or coming up with new ideas or concepts. To be more precise, we should probably say good new ideas or concepts…Ideation in its many forms is an area today where humans have a comparative advantage over machines. Scientists come up with the hypotheses. Journalists sniff out a good story. Chefs add a new dish to the menu. Engineers on a factory floor figure out why a machine is no longer working properly. Steve Jobs and his colleagues at Apple figure out what kind of tablet computer we actually want. …Ideation, creativity, and innovation are often described as ‘thinking outside the box,’ and this characterization indicates another large and reasonably sustainable advantage of human over digital labor. Computers and robots remain lousy at doing anything outside the frame of their programming. (pages 191-2)

These limiting factors define that “high ground” to which traditional educational institutions will need to climb. Ironically, this ground has always been the domain of higher education; but as the mandate of higher education broadened after World War II, this ground was overgrown by other mandates that are now being seized by digitization. Such other mandates include vocational preparation, compensating for a worsening K-12 educational system in America, and “edutainment.”

Conclusion

As Tobias Kinnebrew said, “We shape our tools. Thereafter, our tools shape us.” That is the dominant message for higher education from “Web 3.0.” Here are some speculative implications for how the tools will shape educators:

  • One way becomes two way. The digital services will not be tied only to computers, but will be delivered through a variety of devices, such a mobile phones, eyeglasses, and earbuds. The Internet of Things will permit educators to engage digitally with students in ways that may feel more intimate and attentive to the learning experience. For instance, this will yield greater opportunity to monitor the reaction of students to their lessons and their progress. Software intelligence is rising above the level of a single instructor, department, or institution. Think of the extensive knowledge that Amazon, Apple, or Netflix accumulates about its customers. Without doubt, networks and markets are accumulating that kind of information about our students. Data accumulation will morph into service offerings to students that are ubiquitous and are increasingly customized to their needs.
  • Automation and Ideation. Digital delivery will serve tools and objective information (such as names, dates, and formulas). If IBM’s Watson computer can learn to beat the world’s reigning Jeopardy champion (i.e., a challenge based on ambiguous questions depending on encyclopedic knowledge of trivia), it may be possible to digitize some aspects of mentoring students. Still, I doubt the ability of machines to recognize subtle variations in human emotion and to empathize appropriately. Above all, P2P (person-to-person) instruction best serves to prepare students for ideation and critical thinking—delivering on this is not a stretch for most colleges and universities worth their name. Big data is very interesting. Big wisdom is even more interesting.
  • Innovation at the fringe rather than the center. Incumbency may not be an advantage. So much of innovation today is occurring on the periphery of the industries rather than by the major players. In previous posts, I have argued that the high cost of digital instruction, and the inevitably rising quality expectations would redound to the advantage of deep-pocketed leaders in the field. But the rise of disruptive new players can eliminate the middlemen and edge out the incumbents (think of Uber versus the big city taxi monopolies, Bitcoin versus banks, or Autodesk versus big pharma).
  • Governance and accountability Much of Brynjolfsson and McAfee’s argument says that we should get better at working with smart machines. Probably so. But let’s not teach students to cede accountability or moral responsibility for the consequences of their collaboration with machines. At issue here is, who shall be the master? A related fact is that today, every school is a software enterprise. Design and delivery of the learning experience for students will increasingly entail a software interface in addition to a human face. If, as the foregoing points suggest, that interface will be an integral part of the curriculum, should not the faculty govern it?
  1. Disclosure: my son, Jonathan, was co-chair of the conference. []
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Graduation 2014: Listen Well

My job this afternoon is to convene the proceedings, set a tone, and introduce three speakers. As popular perceptions might have it, we ought to have three case discussions. Instead of three student speeches, we would have three cold-calls. Maybe a few power points. And perhaps an online simulation thrown in for good measure. Darden’s reputation in the broader world is about active, not passive, learning; about debating with your peers; and about figuring things out for yourself. All true, so far.

And Darden is also about listening really well. That’s what I’m going to ask you to do for our three speakers this afternoon. More importantly, that’s what I’m going to ask you to do for the rest of your lives.

Listening well seems to be a fading art. We’ve learned over the past few weeks about commencement speakers who were disinvited because some students didn’t want to listen to them. Yet free speech is a core value at universities. You might disagree with a speaker, but it won’t hurt you to listen. The newspapers this past week reported the retirement of Barbara Walters, the TV interviewer; she was called one of “America’s last great listeners.” Why is she the last? Aren’t people listening anymore? The likes of McKinsey & Company, Darden Dean’s Executive Fellow, Kevin Sharer, and WikiHow have weighed in on the subject of listening well. Sources like these raise a host of great tactics for good listening. For instance, show respect, establish eye contact, stop talking and be silent, encourage the speaker with body language and active listening techniques, suspend judgment, and so on. These are useful tactics, ones that you have heard about and try to practice. But I think there is more.

There is too much noise and not enough respectful silence for others to unfold their ideas. One sees countless errors such as willful distraction, arriving late, leaving early, pointless interruption, etc. Some of this might be elicited by the speakers themselves. The fact is that we are awash in noise: spam, push marketing, ephemeral stuff. And lazy listening passively digests it all.

Great listening is a process of separating the signal from noise, of discerning what resonates or disagrees with you, and of triangulating or testing what you hear with what you know. Signal, resonance, triangulation.

You can adapt great listening not only to an encounter with one person, but also to the world at large. My advice is that whatever you do next, find some quiet where you can spend part of each day to separate signal from noise. Susan Cain, in her book, Quiet, offers a powerful argument in favor of reflection, and deep listening. In effect, she says to think like an introvert. Introverts think to speak; extroverts speak to think.

Next, I urge you to sample widely across sources of information that you tap each day. Get out of your daily ‘me, ’ that echo chamber of favorite websites, Facebook pages, chat rooms and so on that simply reinforce what you already know and believe. Finally, I urge you to drill deep into what resonates.

So much of the advice for new graduates is salted with action-taking, risk-taking, go get ‘em, and so on. What these messages miss is any sensible direction for the path on which you are commencing. As the saying is, “If you don’t know where you are going, any road will take you there.” The prerequisite to setting any good direction is not just planning, or data analysis, or scenario testing. No, the very first step is to listen really well. Remember to focus on signal, resonance, and triangulation.

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Women in Business and the Role of Business Schools

“We cannot change what we are not aware of, and once we are aware, we cannot help but change.”
– Sheryl Sandberg (COO of Facebook)

 

Last week, I reflected a lot on the implications for management education from growing gender equality. And how I spent my time last week will tell you why.

On Monday, colleagues and I met with two admirals from the U.S. Navy to start a dialogue on a range of deep human resources questions, most of which grow out of the increasing diversity of people in the service. The U.S. military has led the liberalization of American society, at least since President Harry Truman desegregated the military after World War II. Today, with the collapse of “don’t ask, don’t tell,” and the advent of women into combat positions, the military is again spearheading change for the rest of American society. This will challenge old attitudes. For instance, women will begin serving on fast attack submarines in January 2015. With women on shipboard in very close quarters, the respect for differences will need to be a paramount value in support of the team and its mission. The Navy wants to instill a culture of respect for gender differences.

That same day, I hosted Lorna Donatone, Chief Operating Officer and President of Sodexo Education. She leads Sodexo’s business at nearly 500 public school districts and at more than 850 college and university campuses, overseeing the work of more than 70,000 employees. She has worked to develop Sodexo’s Employee Network Groups, demonstrating her commitment to diversity, inclusion, mentorship and training managers and employees.

On Tuesday, I met with UVA President Terry Sullivan to discuss faculty appointments. She is a courageous and wise leader. And she is a great ally in recruiting diverse colleagues.

 

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On Wednesday, I joined Valerie Jarrett, Senior Adviser to President Obama, and 13 deans of leading business schools at The White House. The purpose was “to discuss the best practices for business schools to prepare their students for the increasing importance of women in the labor force and the prevalence of employees with families where all parents work.”

 

On Wednesday and Thursday, in the boring interstices of commercial airplane travel, I read Sheryl Sandberg’s Lean In. Very well-written, inspiring, and provocative, the book argues that women are conditioned to “lean away” from professional confrontations in which they would have positive impact were they to seize their place in professional life. This book has important lessons for business educators and leaders.

So, connect the dots of my week: gender diversity is top-of-mind for prominent leaders. It has been on my mind as well: what are the opportunities and challenges around advancing women into positions of leadership in business? What should business schools do about them? While these are big questions, at the White House meeting of deans the other deans raised even more questions about how business schools can play a role in furthering women in business. The answers aren’t simple, but bear with the discussion that follows.

The White House Meeting of Deans

This was framed as a 90-minute discussion among the Deans of business schools at Harvard, Virginia (Darden), Northwestern (Kellogg), Michigan (Ross), Cornell (Johnson), Texas (McCombs), NYU (Stern), Berkeley (Haas), UCLA (Anderson), UNC (Kenan-Flagler), Emory (Goizueta), Carnegie Mellon (Tepper), and Yale. The Deans included four women and ten men. Shortly before the meeting, we were given a list of discussion topics and questions, any area of which would be the focus for a full-day’s conversation—the headline topics were these:

  • Business school timing and the lifecycle: Given the typical profile of a business school student—5 years of post-college professional experience—means that they are often considering having children shortly after finishing their MBA and many may feel that they must postpone having children to get enough years of post-MBA experience. Is this issue raising challenges for female students? Is it raising challenges for men who are increasingly likely to be active co-parents?
  • Retention: Failing to retain female talent is a growing challenge for businesses. It is also a growing problem among men whose obligations regarding work-family balance are shifting. Is there a role for business schools in helping alumni stay connected to their careers? Or to help them reenter after a period out?
  • Pay gaps and career success: How can business schools help address the pay gap between men and women with MBA degrees?
  • Culture: Research has found that women are less likely to re-frame ethical dilemmas to their advantage and instead see them as ethical issues (Kray and Haselhuhn 2012). They also find that women associate business with immorality more than men do. Is there a role for ethics training in helping men and women have more similar outlooks on ethical dilemmas? Are there better ways to teach ethics to make business more welcoming to women?
  • Leadership: How do you broaden the vision of leadership for all students, male and female?
  • Curriculum: How are men and women portrayed in course materials? Has your curriculum adapted to reflect the modern workforce and workplace challenges?

The discussion took a rather free-wheeling path of its own: we touched on some of the agenda questions, but did not reach alignment of opinion. Valerie Jarrett promised the development of a white paper about best practices that would become available to all business schools. I noted a number of interesting points–rather than quoting the attendees or paraphrasing the discussion points I offer them in the form of questions for future consideration. Given the diversity of views at the meeting, readers of this blog will find these points debatable, as I do.

  • In the entire field, there remains a relatively small percentage of case studies that feature women protagonists. What percentage should we aim for? Given that case content turns over 20% per year, how soon should be expect to see significant curriculum change?
  • Should we take gender off the table? Men vs. women is too binary, when what we should do is to consider what all leaders need in coaching and development. Can we “take gender off the table”? The best research in leadership indicates that effective leadership behaviors (Kouzes and Posner) and the stages of leadership development (Joiner and Josephs) are not gender-specific, but are due in part to socialization. Women and men may practice leadership (or be perceived) in different ways. The compelling question is, what do all leaders need in coaching and development? How does gender affect leadership development?
  • Do we really need to teach women to talk more like men? Shouldn’t we teach everyone to talk without bias? And shouldn’t we celebrate individuality?
  • Isn’t the issue really about diversity and inclusion, rather than gender? What role does gender play in the diversity and inclusion conversation?
  • The biggest diversity problem is not the difference of genders, but social class. MBA programs draw mainly from the upper middle class. Shouldn’t we commit to enrolling more women from the bottom quartile of the economic scale?
  • Leadership development requires that we reach out earlier in the pipeline of professional development. If you ask undergraduate students when they decided to become business majors, boys will say “high school,” and girls will say “college.” What will it take to help young women to crystallize their aspirations earlier?
  • Feedback in gateway courses motivates women differently from men: a ‘B’ in introductory accounting will drive women into marketing; men might get a ‘B’ and still go into investment banking. How can we frame early-stage feedback in ways that doesn’t peremptorily drive women out of certain fields?
  • What does it mean to be a leader? If we equate “leader” with “CEO,” the majority of leaders today are men; it doesn’t mean that they are great leaders. What do we really know about traditional characteristics of leadership? Do such characteristics include empathy and the ability to listen, the ability to question assumptions and ask big questions? [1]
  • Undergraduate business is the biggest major in the U.S., with about 50% women. MBA programs are about 33% women students; pre-experience masters programs are about 50%. Part-time and EMBA programs are seeing the entry of very talented women into the professional path. Is the challenge of recruiting women into MBA programs a lifecycle issue around child-bearing? Could we also improve our facilities to support women with young children or that are pregnant with flexible class schedules and/or child care?
  • Re-entry after child-bearing is difficult and fraught with anxieties. The woman wonders: am I capable, ready, and valued? Here’s where emphasis on skills (to build confidence) and mentoring (to handle anxiety) can make a huge difference. She can’t go from zero to sixty in one step; it takes a process of lengthening, frequency, and deepening of contact. The challenge for business schools is to consider how they can prepare and help alumnae to re-enter the workforce following time away to have children.
  • The pay gap requires more transparency and research. Women and men negotiate for pay differently. The issue of negotiation must be broadened to include advocacy and self-promotion. We don’t see enough of advocacy, not just on pay, but also on achievement and career advancement.
  • Is retention more about values than pay? 40% of women in computer science leave because they don’t like the climate in that field. Trust in business is at an all-time low. Isn’t the issue to help build purpose-driven firms? Do women prefer to work in purpose-driven organizations? Do traditional business organization climates drive women away?

The Opportunity

Extraordinary leaders like Terry Sullivan, Lorna Donatone, Valerie Jarrett, and Sheryl Sandberg don’t simply spring out of thin air. It takes decades of training and experience to develop strong leaders. Schools have a vital role to play.

The presence of women itself is hugely transformational—on business and on the schools that train women leaders. As Voltaire said, “God is on the side of big battalions.” The more women who are present, the greater their impact. Simply increasing the numbers of women MBA graduates (the “output”) requires many more applicants (the “input”). Why women aren’t flocking to graduate b-schools is the subject of many theories and rather less research. My guess is that more financial aid and better messaging would help to build the volume—and ultimate impact.

Our experience at Darden shows that even modest increases in the enrollment of women can have a transformational impact on the character and culture of the educational program. Greater representation of women in classrooms, learning teams, and project groups changes the conversation: richer, more diverse, and greater respect for differences. Students (women and men) report higher levels of satisfaction with the learning experience. Faculty report better classroom and team results. And corporate recruiters report greater satisfaction with the pool of talent they encounter. The experience at Darden is confirmed by empirical research elsewhere, some of which was offered as background reading to this meeting.

The Challenge

It would seem that one path to better outcomes would be to enroll more women. Now consider the following:

  • According to the 2010 Census, some 916,000 women graduated from college in 2009; but only about 80,000 women take the standardized entrance exam for graduate business school.
  • Women constitute about 57% of all undergraduate students in the U.S., but only 43% of examinees of the entrance exam for graduate business school.

The following provides a rough estimate of the relevant female applicant pool for the schools gathered for the White House meeting. These data are drawn from the Graduate Management Admission Council (GMAC), which administers the Graduate Management Admission Test (GMAT). Of greatest relevance are the percentages reported by GMAC in Column C—treating these percentages as independent effects gives a lower-bound estimate since the effects are unlikely to be totally independent of each other. Unfortunately GMAC does not easily allow determining the degree of interdependence. This is an opportunity for further research.

Line Group (Column A) Volume (B) % of Line 1 (C) Notes (D)
1 Total Tests Taken by Women 101,336
2 Unique Examinees – Women 81,069 80% Unique examinees were 80% of total tests taken in 2012-13 test year
3 Considering MBA 50,263 62% 62% of GMAT examinees want to apply to MBA programs
4 Considering Full-Time 33,676 67% 67% of those considering MBA want to enroll in full-time programs
5 Scored 640+ 6,062 18% 18% of those considering MBA scored 640+
6 4-9 years of experience 2,122 35% 35% of those considering MBA have 4-9 years of experience

Of the 81,000 women who take the test, only 50,000 have made the decision to apply to an MBA program, of which only 34,000 are considering attending a full-time MBA program. Of these some 6,000 women offer academic potential generally consistent with the admission “sweet spot” of schools at the White House meeting. Taking into account the traditional years of work experience (row 6), leaves about 2,000 candidates. Even if you relax the expectation of years of work experience, the resulting numbers of candidates are small relative to the aspirational enrollment of leading schools. And even the 34,000 women considering a full-time MBA program (line 4) is small relative to the 633 AACSB-accredited institutions in the world (which would yield 54 women per class).

One general conclusion is that if we are to achieve the benefits of enrolling more women in MBA programs, we need more women applicants. Change will come slowly.

Here is some history. The 20-year GMAT volume time-series shows growth in tests taken by women both in absolute number and percentage of total. (GMAC does not report data about unique test-takers, but says that the number of unique test-takers is from 80 to 84% of total tests taken in the years since 2008-09.) The GMAT volume does not directly translate to b-school application volume, especially since GMAT-takers today have many options beyond the MBA degree. Still, from these data, we can infer that more women are applying to b-schools now, at least as a percentage of total b-school applicants, than 20 years ago.

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The growth rate in women taking the GMAT is faster than for men. Over the past 10 years, the compound average growth rate for men was -0.06%; for women +1.72%.

Increasing the representation of women in business school programs would enhance the educational experience of both men and women. Achieving this is constrained by the small numbers and proportion of women seeking education in business. Therefore a priority should be to increase the pool of qualified applicants. Actions to support this priority could include:

  • Improve K-12 education to promote entry into, and graduation from, undergraduate programs.
  • Intensify outreach from undergraduate and graduate business schools to undergraduate students.
  • Expand public and private financial aid for women students.
  • Promote programs that help undergraduate women transition into business careers. These include short certificate programs and one-year “Masters in Management” programs to be taken immediately after undergraduate school.
  • Relax H1-B visa requirements for international women seeking to work in the U.S. upon graduation from MBA programs.

Conclusion

The various conversations and readings last week reaffirmed for me the importance of how business schools frame their work to prepare leaders for a society of growing diversity. Sheryl Sandberg got it right: witnessing the growing diversity of enterprises and organizations is a wake-up call to all leaders. Standing still is not an option. The stories and initiatives of which I heard at the White House suggest that all b-schools are moving. And the pace of change within schools may seem unequal to the challenge:

  • Extraordinary leaders like Terry Sullivan, Lorna Donatone, Valerie Jarrett, and Sheryl Sandberg don’t simply spring out of thin air. It takes decades of training and experience to develop strong leaders of either gender. Schools have a vital role to play.
  • The presence of women itself is hugely transformational—on business and on the schools that train women leaders. Growing diversity will have a staggering impact on organization cultures (imagine the leap the Navy will make with the introduction of women on submarines.)
  • One size does not fit all. A growing body of empirical and anecdotal evidence shows that women and men experience school in different ways. Research indicates that women experience the learning process differently than men (see, for instance, Women’s Ways of Knowing the cornerstone study in this area). Shaping the learning experience that best serves the development of women and men is the focus of quite a lot of experimentation at b-schools today—Darden’s experience and the conversation at the White House meeting suggest avenues of such experimentation.
  • It’s a marathon, not a sprint. Women will slowly increase as a percentage of all business students. The response of graduate business schools today will start to have visible impact in society in maybe a decade.
  1. Are we not after a new style of leadership, one that combines characteristics of what might be considered as feminine and masculine characteristics? See, for instance: http://www.johngerzema.com/presentations/tedxwomen-talk and http://www.johngerzema.com/books/athena-doctrine. []
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My Transition to Come: Dean to Professor

Yesterday, UVA President Terry Sullivan announced my intention to transition back to Darden’s faculty at the end of my second term as Dean, July 31, 2015. I call on the Darden Community to support the Dean search process with advice, nominees, good will, and the patience that a major executive search demands. The Search Committee will be chaired by Professor Ken Eades and is chartered by UVA’s Provost, John Simon. Their search process will be thorough, professional, and engaging of all of Darden’s constituencies. Given the healthy lead time, I’m confident that the search will be a success.

My choice to return to teaching and writing was the result of a lot of personal reflection and discussion with family, colleagues, alumni, and, of course, the President. It’s been no secret: most colleagues have known about my intention since 2011. But the most frequently asked question is this: if I’m happy and Darden is in a good place, why let up? Here’s my thinking:

  • We’ve finished much of what I hoped we would achieve when I accepted the deanship in 2005. Darden has challenges and opportunities ahead–and the school is in great shape to meet them: the world’s best faculty (say several rankings); distinguished Grounds; devoted alumni; transformational learning experience; awesome students; and large endowment. I didn’t accomplish all that; the whole community did. I’m just pleased to have had a voice in the chorus.

  • I love to teach and write, for which I entered academic life. Being Dean is quite exciting but crowds out the deep reflection required to teach, research, and write very well. And it takes a heavy commitment of time and energy to advancing the school–I’ve averaged 145 days out of town per year for the past nine years.

  • Ten years is a nice round number—think of it as the “Goldilocks” tenure, long enough to have an impact, and short enough to ensure fresh perspective with some regularity. In comparison, the median tenure of a business school dean is about four years—this is not long enough to drive real change in academia. And what a ten years it will have been: Global Financial Crisis, Great Recession, the events of June 2012, Capital Campaign, EMBA, GEMBA, diversity, sustainability, globalization, MOOCs, and more.

  • Darden houses impressive talent and has good depth of leadership. The rising faculty and staff leaders are stars. I’m confident that they will sustain Darden’s momentum and good direction.

In view of these, and of the fact that I’ll be 65 in October, this next year seems like a good pivot point in my own journey. It’s been a deep honor and very fulfilling to serve Darden for a while as Dean.

Onward and upward!

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Learning by Doing and Persevering

“Education is a choice. We don’t become educated by watching television, and we don’t learn a whole lot having similar conversations with the same, safe people day after day. Our education comes from pushing up against boundaries, from taking risks that may seem at first to be overwhelming, and by persevering past the first disappointments or shortfalls until we reach a point at which actual learning takes place. Determination and perseverance are absolutely vital to developing a true education–rarely, if ever, do we learn the most valuable lessons in the first few steps of the journey.” — Tom Walsh

These words came to mind as UVA’s ACC tournament championship culminated in an exchange of emails between Kathryn Sharpe, Assistant Professor at Darden, and me. The subject: why do we play games as part of an educational experience? Our answers echo Tom Walsh.

Bob

Games are all around us. UVA topped the Atlantic Coast Conference in basketball this winter and is going into March Madness with elan. Recently, my wife and I  hosted a group of first-year students to our home for dinner and a game of Monopoly.  Everyone played earnestly and with a lot of humor.

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In the picture, the students holding the bottles of bubbly had amassed the lion’s share of the assets when the clock ran out—and everyone (re)learned some lessons about liquidity, solvency, risk, and return.

Darden and its peer schools are doing more with games and simulations in courses as well.  We do this not because it is fun (yes it is) or because our students need to gain a winning mindset (they generally bring that already); rather, we use games and simulations as a device for learning from failure. To fail in the classroom is relatively safe and inexpensive. If students are able to let go of what they perceive to be the risk to their social capital, they will realize that they have paid their tuition so they may fail, learn, and avoid the mistakes in the future, where it counts.  If they do not take these risks here, they are not fully taking advantage of their time and tuition.  Failure is a powerful teacher.   Michael Jordan, perhaps the best basketball player in history, said, “I’ve missed more than 9000 shots in my career. I’ve lost almost 300 games. 26 times, I’ve been trusted to take the game winning shot and missed. I’ve failed over and over and over again in my life. And that is why I succeed.”


Kathryn

As a junior faculty member, it occurred to me this year that academia involving research results, journal publications, and course evaluations is about 90% rejection (failure) with 10% success. These are rough odds.  I have begun contemplating, do I learn from my 90% failures to achieve the 10% success?  If I did, would my success rate inch up by a percent to 11%?  Am I fully benefiting from my mistakes?  As I urge students to embrace the risk of “failure,” these are all good questions to entrust to my own heart.

Our first year students are about to participate in the most comprehensive simulation experience that they have undertaken at Darden with every student team to compete with each other to win, as a virtual company, at a new car launch. It requires our students to integrate everything they have learned during their first year of coursework: accounting, operations, marketing, and strategy, and finance (their choices to launch a new car platform even impact their virtual company’s stock price in the simulation). As the students will be working with their peers, the learnings from the Leadership & Organization course are critical to winning, if not at this weeklong game, at life.  Historically, the students have loved this week long simulation and benefit from it greatly.  Although we learn from the “winners” (each student team debriefs its strategy at the end of the week to its peers), the class tremendously values the experience of the “losers.” The ability to “lose” graciously, laugh at oneself, and learn at the same time, is beautiful.

In addition to failure being such a great teacher so is illness. As I have contended with two serious health diagnoses over the last year, I realize that I am not super-human, that my body has limits, and that the people around me, including my colleagues and students, are supporting me. I have learned that my fellow team members will pick up the slack for me when I have fouled out, leave me room on the bench to catch my breath, and include me in their successes even though I have not done much to contribute to their win. The lesson that I am valued here beyond what I produce or how I am used would have come through no other way than through illness. Having just finished up a six month journey of medical treatment on Friday, I have the opportunity to get back in the game – leading my students through their weeklong simulation this Monday. I am grateful for the opportunity to be able to celebrate their successes and appreciate, on an even deeper level, their perceived failures.


Bob

We play games and simulations in order to carry our students well beyond mere knowledge acquisition. The world needs MBA graduates who can deal with ambiguity, take sensible risks, and interact with others professionally—even when the conditions are stressful. Games and simulations help to model the complexity that decision-makers face. Here one confronts the fact that it is not the greatest intellect or talent that succeeds, but rather, the person who perseveres. Tom Walsh got it right: “Determination and perseverance are absolutely vital to developing a true education.”

So it is with an illness. So much about recovery and wellness requires determination and a positive attitude. Kathryn, you’ve shown these qualities. Welcome back!


And welcome back to our students. A great conclusion to the academic year lies ahead. Give it the determination and perseverance it deserves.

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Higher Education as a Winners-Take-All Market: Effectual Thinking versus the Treadmill

In my last blog post, I profiled the attributes of “winners-take-all” markets. And I implied that such markets might be closer than you think. Well, they are for me.

Higher education is a winners-take-all market. Despite the cool indifference to competition that many academicians affect, the competition among colleges and universities is serious. Aside from the fact that most people want to belong to a community that matters in some respect, some faculty, staff, parents, students, alumni, governments, and media mavens ask a provocative question: “Why strive?” In other words, why should institutions keep piling on the investment in programs, faculty compensation, facilities, and the like? Isn’t the institution of X years ago sufficient to the mission? The winners-take-all concept helps to explain what’s going on, and presents a rather depressing outlook. But I think there is a way out of the morass. Let me tell you how and why.

The Self-Reinforcing Cycle in Higher Education

To start with, consider the evidence that higher education is a winners-take-all market. The two most prominent attributes of such markets are that (1) assessment is based on relative, not absolute, performance, and (2) that rewards are concentrated in the hands of a few top performers. Higher education models these attributes well.

Relative assessment. In a world of absolute assessment, a college or university would ask itself, “Did we fulfill our mission? How well did we do it?” In this world of relative assessment, the question would be, “How well did we do it compared to a benchmark of other schools?” That institutions compare themselves to other schools is no secret: most collegiate associations provide databases by which leaders can easily make such comparisons. More importantly, many external sources provide ratings or rankings, some followed by millions of readers. (In previous blog posts I have criticized the rankings (see this and this).) Despite the criticisms, we know that people pay attention to these relative assessments: material changes in rankings seem to trigger material changes in the volume of applications for admission, philanthropic gifts, media attention, and the success of faculty recruiting efforts. For instance, a study by Michael Luca and Jonathan Smith found, “a causal impact of rankings on application decisions. When explicit rankings of colleges are published in U.S. News, a one-rank improvement leads to a 1-percentage-point increase in the number of applications to that college.” Forbes Magazine reported, “Just as an analyst’s upgrade can spark a rally in a specific stock, a college’s move up the rankings usually results in a financial windfall. “There’s institutional pressure at colleges to achieve at all levels, and that includes rankings,” says Troy Onink, a college planning expert and FORBES contributor. “It’s a hypercompetitive world for the best students and for that tuition revenue.””

Concentration of rewards. To the victors belong the spoils. In the previous post, I characterized the payoffs in winners-take-all fields as highly asymmetric (to math geeks, it might look like an exponential growth curve): the winners get a lot and the rest get a little. Here are some examples.

Textbook sales, Ph.D. production, and article citations. In his seminal article on the winners-take-all phenomenon (“The Economics of Superstars,” 1981), Sherwin Rosen wrote, “sales of elementary textbooks in economics are concentrated on a large group of best sellers, though there exists a large number of very good and highly substitutable alternatives in the market (the apparent inexhaustible supply of authors willing to gamble on breaking into the select group is one of the reasons why so many are available). A small number of graduate schools account for a large fraction of Ph.D.s. A relatively small number of researchers account for a large fraction of citations and perhaps even articles written.” (p. 845).

Admissions selectivity. “Reward” could also be measured by the ability to recruit excellent students. Consider some evidence from US business schools. One metric would be the selectivity ratio of admissions (the number of offers of admission divided by the number of applicants). This graph shows that the higher the rank, the more selective the admissions.

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Another aspect of selectivity would be the ability to attract students of high academic promise. The following graph relates the average GMAT test score by ranking group (the Graduate Management Admissions Test is the leading standardized admissions test in the field). The graph reveals a strong association between rank and test score.

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Of interest here is the association between rank and selectivity or average GMAT score. As the following table shows, the correlation percentages are high by typical experience in social sciences. (Note that BusinessWeek does not use the GMAT and selectivity ratios in computing its rankings.)

GMAT Score Admission Selectivity
Correlation with Ranking Groups -91% 85%
Correlation with Rank of Individual Schools -81% 66%

Ability to command premium prices. Another way to consider concentration of rewards is to look at the ability of a school to command a high price for its degree program. Sure enough, as the following graph shows, there is an association between ranking (judging business schools on relative, not absolute, performance) and rewards: as ranking falls, so does price.

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Program revenue. Or, you can see concentration of rewards in terms of total revenue of an MBA program. Revenue measures both the ability to command a high price and to attract large numbers of students at that price.

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Research hits. Business schools also display a strong asymmetry in research productivity. Here is a graph based on rankings and research publications collated by the University of Texas—Dallas.

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Federal Government Research Grants. In its annual report for 2011, the Center for Measuring University Performance presented evidence of a strong winners-take-all phenomenon in the ability of institutions to attract federal grants. Here are some excerpts:

A relatively few top performers among research institutions control a large percentage of the market and this concentration remains stable over time….This distribution is a little more unequal than the most unequal country income distribution in the world.((“The Top American Research Universities” 2011 Annual Report, the Center for Measuring University Productivity, pages 3-9))

Endowment. The ability to draw philanthropic gifts to support the school is another measure of the distribution of rewards. Nothing succeeds like success. The leader in the field, Harvard University, just announced the commencement of a $6 billion capital campaign.

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Other. I will assert (and leave it for others to research) that in addition to pricing and research grants, higher education displays winners-take-all attributes in respect to faculty prominence, physical facilities, media attention, and so on.

You get the idea. Institutions of higher education in America are subject to strong winners-take-all forces.

Implications: The Self-Reinforcing Cycle

Students of the winners-take-all phenomenon point to feedback effects by which strengths reinforce reputation which reinforces strengths. You get to be known as a winner which draws attention, strong students, leading faculty, happy alumni, growing research grants, and big donations. This is a self-reinforcing virtuous cycle.

Of course, the cycle can work in reverse. Some shock triggers doubt and disbelief in the school—perhaps it’s a tragic shooting, wave of exam cheating, sexual abuse, NCAA violations, a loss of accreditation, a governance crisis, or faculty strike. Or perhaps it is an external event such as a market crash that wipes out a school’s endowment or the advent of new technology. In a recent interview, Rich Lyons the Dean of UC Berkeley’s Haas School of Business was quoted as saying,

“Half of the business schools in this country could be out of business in 10 years—or five,” he says. The threat, says Lyons, is that more top MBA programs will start to offer degrees online. That will imperil the industry’s business model. For most business schools, students pursuing part-time and executive MBAs generate crucial revenue. Those programs, geared toward working professionals, will soon have to compete with elite online alternatives for the same population.” [1]

As applications, quality of students, donations, and affirmative media coverage fall, so do rankings. And the cycle continues: more doubt and disbelief; more declining relative performance; fewer rewards. The school stalls, and then nose-dives. This is a self-reinforcing pernicious cycle.

Given a choice, most academic leaders will strive to place their institutions on the self-reinforcing virtuous cycle. Such striving explains some part of the ongoing ample investment in people, programs, and facilities at business schools, colleges, and universities. America, in particular, has always been a society of strivers. Therefore, the behavior of higher education may seem to be a piece of the larger culture.

A Caution

But reaching for the virtuous may still result in the pernicious. Consider some possibilities.

Recruiting talent. A school seeking to rise in a winners-take-all field could alter its recruitment of faculty and students in an effort to look just like some schools higher up the food chain. The downside of this is to draw people into the community who may not share the values or sense of mission of the school. Or it may promote conformity. “Late bloomers” or oddballs may have something to teach their classmates either now or later—as the lives of Steve Jobs, Bill Gates, and Larry Ellison show.

Dumbing down the curriculum. A cynical way to recruit is to lower the standards of performance: less teaching for the faculty, grade inflation or lighter degree requirements for students. The term, “Mickey Mouse degrees,” gained currency in 2003 when Margaret Hodge, the UK Minister for Universities, faulted programs “where the content is perhaps not as [intellectually] rigorous as one would expect, and where the degree, itself, may not have huge relevance in the labour market…simply stacking up numbers on Mickey Mouse courses, is not acceptable.”

Gaming the system. The winners-take-all payoffs create a strong incentive to cheat. Recent news stories have reported the falsification of data reported to major collegiate rankings by Claremont McKenna, Bucknell, Tulane, Iona, and Emory (see this, and this). The 2012 survey of College and University Admissions Directors by Inside HigherEd found that “Nearly all institutions (99 percent) report that they have not falsified student admissions data; most (91 percent) report that they think other institutions have falsified such data.” (Pg.1)

Not Merit but… A high reputation could reflect momentum in terms of size, a media blitz to inflate a past legacy, social capital (or promise of membership in an elite community), influence, or wealth rather than real academic merit. The “stickiness” in the rankings, NSF league tables, and seedings in athletic competitions are not inconsistent with this. Which is the cause and which the effect? Do schools win relatively high reputations based on merit, or based on the “bling” one associates with merit?

Managing to the rankings. In an influential report on research universities, John Lombardi wrote, “If…the university emphasizes behaviors that influence the rankings elements but do not necessarily improve the performance of the institution, then the impact of the league table is negative. Even more significantly, if the importance of the league table in sorting institutions by reputation has an impact on access to resources or the imposition of government policies and controls, the influence of the ranking can easily become pernicious. Universities and other academic units ranked in these contests may also work to manipulate their data by strategies that give them a comparative advantage in the rankings unrelated to their actual performance. Other than simply submitting fraudulent data (which can happen and which is why good rankings are always transparent and provide all the data and calculations for public review), universities can pursue other strategies. If high scores on entrance exams figure significantly in the calculation of an important ranking, universities can divert funds to increase the scholarships used to entice students with exemplary entrance exam results to enroll. By buying students with better examination scores, the institution’s ranking will increase although the institution itself may not have become better.”((“In Pursuit of Number ONE” by John V. Lombardi, The Top American Research Universities, 2010 Annual Report, Center for Measuring University Performance, page 9.))

The Investment Treadmill. When an institution decides to compete in the winners-take-all competition, it commits itself to a path from which it may be difficult to depart and which will demand rising commitments. Perhaps this results from “striving” (mentioned earlier) or sunk cost thinking. Either way, the demands for investment can be impressive. Consider again the commentary from the CMUP report on research universities:

This competition is constrained by the structural characteristics of the marketplace. Within the top 150 to 200 performers, mostly the same institutions compete every year. This competition is an essential element of their institutional design and mission and they must participate to remain major research universities within the United States. Success in this competition is a function of investment and careful management of institutional subsidies over time.

Research is one of the university’s loss leaders. Almost no research reflected in this competition pays its full costs. Instead, the federal research expenditures reflect only a partial reimbursement of the institution’s investment in that research. Universities need to understand the opportunities and constraints of the research marketplace as they budget funds to subsidize competitive research activities…

…Another way to look at the structure of this distribution is to measure how much it would take to move the middle institution in each group to the midpoint of the group above it. The purpose of this kind of approach is to identify the challenge faced by universities that commit themselves to the investment required to make a major change in their competitive position…

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These [comparisons] indicate the strong structure of this marketplace over the past decade and highlight the major effort needed to move an institution a significant distance within this competitive context.2011 Annual Report, the Center for Measuring University Productivity, pages 3-9))

Resisting the treadmill

The winners-take-all market in higher education poses an existential problem for educational leaders. The vast majority of institutions don’t display the attributes of winners and therefore have little hope of reaping the rewards to which they might aspire. The competition to excel and to join the small pool of winners is really intense. Aspirants keep elbowing into one’s competitive space. Overcrowding prompts heavier investment in an effort to get ahead, or just keep up with the crowd. Various constituents prod the leaders of the institution, demanding no relaxation of the race. Falling behind isn’t an option because just as there is a self-reinforcing feedback loop that helps schools as they rise, there is a vicious negative feedback loop that can suck schools downward. Strive for the good and avoid the bad—but resources are finite and burnout looms. By what reasonable strategy could a school respond to the winners-take-all market and survive?

The first priority must be to avoid the paths that are traps. For instance:

  • Continuing to invest heavily in technology, MOOCs, financial aid, faculty, buildings, amenities, and so on when the school can’t afford it. For the majority of schools the winners-take-all treadmill is unsustainable. It is useless to compete with competitors who have very deep pockets.

  • Doing nothing. In the face of the turbulent changes looming for higher education, standing still is not an option. Recall Rich Lyons’ prediction (see above). Or see a prescient article in The Economist, entitled, “Trouble in the Middle.”

  • Giving up. A school could simply surrender and close its doors. Ray Brown reports that some 74 American institutions closed since 2000—many multiples of that number merged into other institutions.(( http://www2.westminster-mo.edu/wc_users/homepages/staff/brownr/closedcollegeindex.htm)) Such harsh steps could be warranted for schools in depressed regions or that have lost their way. But this hardly serves the educational mission to which so many faculty and staff members are called; nor does it serve the wider constituency of any school.

  • Collusion. Frank and Cook, the authors of the Winner-Take-All Society, advise “positional arms-control agreements” to limit wasteful spending. This breaks the “prisoner’s dilemma” whereby competing schools realize their mutual self-interest and agree to a set of practices that ensure survival. The authors cite “redshirting” in college athletics, and the practices within the Ivy League that limit excessive spending on sports. The downside is that such agreements are easily broken by unruly upstarts—think of the oil cartel. Moreover, collusion can often descend into a restraint of trade, through price-fixing and conspiratorial admissions policies.

The other path

Find a defensible niche and work to dominate it. Recall that the problems with the winners-take-all market are overcrowding and positioning that is based on relative, not absolute, performance. Everything depends on how you frame your school’s identity, and thus by inference, how you frame the field it serves and within which it competes. Therefore, the other path would be to compete for relative position in a defensible, important, and possibly smaller field. This takes great clarity about mission and purpose. It is risky if you define your niche in a way that is unappealing to the constituents to whom you appeal.

One way to discover the defensible niche and manage the risks is to be “effectual.” My colleague, Professor Saras Sarasvathy, has studied “expert entrepreneurs,” people who started at the wrong end of the “winners-take-all” food chain and still created a winning outcome. She concluded that these people thought in a very different way compared to novice entrepreneurs, those more likely to fail than the experts. The chief difference was that the expert entrepreneurs thought in terms of effects or outcomes, rather than causal if-then logic. Saras offers an example: a chef focused on causation will plan a menu and cook according to what the customer is likely to eat; but a chef focused on effectuation will see what is available or “fresh today” and prepare the best meal with the ingredients at hand. Her theory of “effectuation” has had revolutionary impact on the way business schools train entrepreneurs. I believe that her lessons are also relevant to leaders in higher education, especially those who are bedeviled by a belief that the “winners-take-all” market is stacked against their institutions. At Darden, Saras’s principles have spawned a set of effectual pratices that help us to contend with winners-take-all.

In particular, Saras has highlighted five principles:

  1. “When expert entrepreneurs set out to build a new venture, they start with their means: who I am, what I know, and whom I know. Then, the entrepreneurs imagine possibilities that originate from their means.” Successful entrepreneurs don’t start with goals, they start with resources, capabilities or tools that are at hand. They focus on what they have, not with what they wish they had. They ask, “What can I do with what I have?” Think of the effectual chef—I suspect that parents cook effectually for their children more often than they might admit. For faculty and administrative leaders, this requires an absolutely fearless, sober, and candid assessment of the competencies of the institution. What are the school’s strengths? Take care that this assessment should be based on absolute, rather than relative, assessments of performance. The next step is to ask what the school can do to exploit these strengths. At Darden, we conduct an annual leadership retreat to explore these questions and frame new projects, experiments, prototyping, and design efforts with which to challenge ourselves. The incumbents and aspirants in the niche we define keep changing. Therefore, we don’t settle for a “once and done” definition of the service we give.

  2. “Expert entrepreneurs limit risk by understanding what they can afford to lose at each step, instead of seeking large all-or-nothing opportunities. They choose goals and actions where there is upside even if the downside ends up happening.” Launch first, profits later. The question that kills so many fledgling ventures is, “How much money will you make and when will you make it?” The reality is that no one knows. You must consider the launch of a start-up much like buying an option. You spend a little money to see what happens. If the initial results are nice, you spend a little more, and so on. Thus, the dominant questions that successful entrepreneurs ask are, “How big a loss can I afford? And what can I do to minimize that loss?” For faculty and administrative leaders, this probably means avoiding big-budget high-stakes bets, the academic equivalent of the moon shot, the Manhattan Project, or the D-Day Invasion. Instead, it probably entails making a range of little bets, seeing what pays off, and successively nurturing the winners. In this regard, I have previously recommended the book by Peter Sims, Little Bets: How Breakthrough Ideas Emerge From Small Discoveries. It is a delightful and provocative reading about the origin of innovation. At Darden, we have been using the theory of little bets very successfully in areas such as the development of MOOCs, field experiences, behavioral research, and communications and marketing.

  3. “Expert entrepreneurs build partnerships with self-selecting stakeholders. By obtaining pre-commitments from these key partners early on in the venture, experts reduce uncertainty and co-create the new market with its interested participants.” Partner early and often. Saras says, “Entrepreneurs cooperate with parties they can trust. These parties can limit the affordable loss by giving pre-commitment.” As the old Beatles song says, “I get by with a little help from my friends.” The social network can be powerful, not only for the financial resources it affords, but also for the doors it may open to other relationships. At Darden, we expanded our network of corporate partners and discovered a new circle of support that culminated in the founding of our Institute for Business in Society.

  4. “Expert entrepreneurs invite the surprise factor. Instead of making “what-if” scenarios to deal with worst-case scenarios, experts interpret “bad” news and surprises as potential clues to create new markets…Surprises are not necessarily seen as something bad, but as opportunities to find new markets.” The discovery of the wildly popular Post-It Notes® by 3M Corporation was triggered by the failure of an adhesive—the scientist simply tried an alternative application for the semi-sticky glue. If an initiative hits dead-end, the academic leader may be inclined to abandon it—if so, it is always useful to ask, “What did we learn from this? What can we do with what we learned?”

  5. “By focusing on activities within their control, expert entrepreneurs know their actions will result in the desired outcomes. An effectual worldview is rooted in the belief that the future is neither found nor predicted, but rather made.” So many of the dire predictions for higher education are fatalistic. I like Saras’s fifth principle because it reflects a spirit of self-determination. Applying this in an academic setting may require a cultural shift. A slogan among my colleagues at Darden is standing still is not an option. Whatever happens, we want to get on with realizing our highest potential.

Effectuation is relevant for higher education because it employs non-predictive strategies and thus allows one to create and grow in an environment of uncertainty and unpredictability. Predictive strategies in higher education are risky, because we can hardly foresee with any amount of confidence what higher education of the future will look like.

Saras Sarasvathy wrote, “Underlying all the principles of effectual reasoning is a coherent logic that rests on a fundamentally different assumption about the future than causal reasoning.  Causal reasoning is based on the logic, To the extent that we can predict the future, we can control it.  That is why both academics and practitioners in business today spend enormous amounts of brainpower and resources on developing predictive models.   Effectual reasoning, however, is based on the logic, To the extent that we can control the future, we do not need to predict it.” [2]

Conclusion: The future made

Today, higher education resembles a winners-take-all market.  To win is great, gratifying, and reinforcing.  But striving to be one of the winners is fraught with great difficulty: heavy investment, long duration with slow advancement, and serious temptations to err—it may place the school on a long and weary treadmill that is unsustainable and ultimately dangerous.  Fortunately, there is an alternative: find strategic advantage through defining a defensible niche in higher education by means of effectual thinking. To do this, an educational leader must stop seeing competition as a game or a “hunt” in the first place.  The point is not to “win” within an existing market but to “create” new possibilities and enduring value.  An effectual approach argues for a move away from a hunter-gatherer mentality of “the” education market and toward a more plural agrarian view of co-created niches that we will design and redesign into gardens we cannot even imagine today.


Note: I thank Asif Mehedi (D’12), research assistant, for effective and effectual contributions to this post. And I am grateful to Saras Sarasvathy for comments.

  1. “Half of US Business Schools Might Be Gone by 2020” Bloomberg BusinessWeek March 14, 2014. http://www.businessweek.com/articles/2014-03-14/online-programs-could-erase-half-of-u-dot-s-dot-business-schools-by-2020?campaign_id=DN031414) []
  2. Sarasvathy, S. D. (2001). “What Makes Entrepreneurs Entrepreneurial” Darden Business Publishing. []
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When Winners Take All

“The Olympics is really my favorite sporting event. Although I think I have a problem with that silver medal. Because when you think about it, you win the gold – you feel good; you win the bronze – you think, ‘Well, at least I got something.’ But when you win that silver it’s like, ‘Congratulations, you almost won. Of all the losers you came in first of that group. You’re the number one loser. No one lost ahead of you!’”
— Jerry Seinfeld, from I’m Telling You for the Last Time (1998)

The 2014 Winter Olympics games are now behind us. The cascade of newly-created celebrities sparks a reflection about the winner-take-all phenomenon: the asymmetry of rewards, where the winner reaps an outsized share of the rewards in the game, leaving little or nothing behind for the others. This seems unfair, especially on behalf of those who trained thoroughly, played hard, observed the rules, and finished second…or last. And it is not hard to find examples. Olympic Gold Medalists benefit disproportionately from endorsement revenues, speaking fees, and the like. Think of the compensation of top performing artists, sports figures, and CEOs. Or, think of the windfalls to successful inventors, entrepreneurs, and Nobel Laureates. Think of Secretariat, ranked as the top race horse of the 20th Century—can you recall the also-rans? Think of the sheer dominance of Microsoft in computer operating systems, of Google in Internet search, or of New York and LA in respect to arts and entertainment.

When winners take all

Robert Frank and Philip Cook, in their classic book, The Winner-Take-All Society, wrote that the “winner-take-all markets translate small differences in performance into large differences in reward.” They identified a range of attributes:

    • A focus on relative, rather than absolute, performance. In most markets, the reward from your effort is based on how many hours worked or how many widgets produced—those are examples of absolute performance. But in some settings, absolute performance does not yield the reward; what matters is being better than competitors. The focus on relative performance differentiates the winner from the rest. The asymmetry of rewards to effort can lead to the dystopian frame of mind expressed by Gore Vidal: “It is not enough merely to win; others must lose.”
  • Concentration of rewards “in the hands of a few top performers, with small differences in talent or effort often giving rise to enormous differences in incomes,” as Frank and Cook wrote (p. 24). To help you visualize what this looks like, the graph nearby presents a hypothetical payoff across a range of 50 players on the basis of relative performance. Math geeks will recognize this as an exponential curve—the point is that the rewards are not flat across performance (pure equality) nor growing linearly (in common proportion across added units of performance). Rather the payoffs compound as units of relative performance grow.
  • Overcrowding. For every rock star, there are many thousands of “wannabees.” The focus on relative performance and resulting asymmetric payoffs tend to draw into the competitive field more contestants than may be warranted on any rational calculation of benefits and the probability of winning. Overcrowding causes the dilution of benefits to non-winners across a wider population. All of this leads to “tragedy of the commons” in that too many also-rans depress the per-capita compensation for them. Frank and Cook wrote, “the overcrowding problem in winner-take-all markets arises because participation in these markets is misleadingly attractive to individuals.” (p.21) They point to a variety of possible causes of overcrowding, such as overconfidence (a belief that you can beat the odds and win); thrill-seeking; status-seeking, and/or intrinsic joy in the activity (you love to sing opera in the shower and therefore audition for the Met).
  • The rise of mass-markets for some kinds of talent (e.g. prizefighting on cable TV) that makes it possible to reach a very large audience and leads to outsized purses to the winner.
  • Network effects can create winners who take all: consider that a product can become more valuable, the more people that use it. The fax machine is a prime example, as is Microsoft’s Windows software. Competitors in a market may be able to gain outsized rewards through the adroit use of network effects.
  • Lock-in or barriers to exit—path dependency. Microsoft Windows illustrates another aspect of winner-take-all markets: apparent customer loyalty might be driven by the cost and inconvenience of switching to a competitor. The customer is locked-in, assuring repeat sales and a strong market franchise. This produces what Frank and Cook call, the “Matthew Effect” (“For unto everyone that hat shall be given, and he shall have abundance; but from him that hath not shall be taken away even that which he hath.”)
  • Feedback loops. Being known as a leader may enhance your chances of remaining a leader in future rounds of competition. Think of the movie director who gets bankrolled on the basis of past film successes, or the Grand Slam tennis pro who gets top-seeding in subsequent tournaments. In business, the saying was, “you never get fired by buying IBM”—where you are less confidence in your own analysis, it may be easier to go with a well-known brand. Well-branded products can discourage buyers’ remorse. Of course, the feedback loops can work in a negative direction as well.
  • The emergence of “deep-pockets markets,” which Frank and Cook describe as “a small number of buyers intensely interested in the winner’s performance.” The market for expensive art, yachts, and professional services such as law, asset management, or investment banking. Customers in these markets want the very best and are relatively price-insensitive.
  • Markets for status or positional goods. The economist, Thorsten Veblen, first identified “conspicuous consumption” as a phenomenon in economic behavior. Perhaps people buy luxury goods not because they are better made, but because they signal success, exclusivity, and taste and therefore help to attain higher social status. Such goods are all about relative positioning and they command a substantial premium in the market.
  • Information revolution. We are flooded with free and easily accessible information that helps us make relative comparisons, such as “likes,” ratings, rankings, and customer comments. More is known about products and their relative positions. There is more criticism, commentary, and opinion-generation. Aggregators of opinion (Fandango average the ratings of critics and fans). Information overload makes one default to the positionally-dominant product—branding pays. IT grants an increased ability to match products and buyers in deep-pocketed markets (e.g. ebay). Increased transparency about social context heightens relative comparisons: think of the close scrutiny drawn by published salaries. The advent of information technology has undoubtedly intensified the winner-take-all phenomenon through transparency that helps one to compare relative positions.

The problems with winner-take-all markets, as Frank and Cook see it, have to do with wasteful investment, overwork to try to stay competitive with peers, or over allocation of talent to a field of marginal benefit to society (how many oboists or hedge fund traders does the world need?) In an effort to cultivate the aura of a “winner” contestants may tend to overinvest in cosmetics, clothes, homes, and lifestyles. Wasteful investment might lead to intensified competition in settings where collaborative effort might be better—the aspirants to the top job in politics or business might behave in ways that make the enterprise or society worse off. This is the familiar “prisoner’s dilemma” problem in which individual incentives yield bad results for the group as a whole.

Now, take a deep breath

It is the notion that the rewards accelerate (“the rich get richer”) that makes the winner-take-all phenomenon a piñata for egalitarians. The fact that the rich get richer—without much more absolute performance—seems unfair. Does the fact that the Gold Medalist beat the Silver by a tenth of a second warrant a much richer payoff for the Gold? Going farther down that path, one might wonder how much of a time difference would justify a greater payoff for the Gold? That’s like asking how much curvature in the payoff graph you would be willing to accept. The fact that people will disagree on the answer makes it very difficult to assert exactly when a market becomes winner-take-all. We are left echoing the words of former Supreme Court Justice Potter Stewart, who opined in reference to obscenity, “I know it when I see it.”

America values equality of opportunity. But strict equality often imposes its own tyranny. And life is full of unfair advantages. You might envy your neighbor’s good looks—do you really feel that society owes you a surgical makeover? Anyway, is the downside of failure in a winner-take-all market always catastrophic? In his seminal article on winner(s)-take-all (“The Economics of Superstars”), Sherwin Rosen wrote,

Too little is made of the option value of occupational risk-taking. Private and social losses are limited by a person’s option to quite competing and try something else. Working life and long and most of the time this information comes fairly quickly. There is compelling empirical evidence…that lawyers who do not make partner in big firms live nicely as partners in smaller ones, that would-be Picassos live useful and rewarding lives as commercial artists, and similarly for just about every high risk occupation. Some people who fail do suffer disastrous consequences, but generally less is at stake in these gambles than meets the eye. (p. 135)

It is argued that winner-take-all markets reveal an inefficiency, a market breakdown. Flawed markets invite government intervention, which Frank and Cook sought to remedy by progressive taxation, “arms-limitation” agreements, and other intrusions. But there is not enough evidence yet to convince an objective judge that this market inefficiency is so costly as to warrant intervention. Anyway, it is hard to imagine what might be the interventions in higher education. Is the NCAA a good model of “arms limitation” in higher education? Is it really all that bad? In reviewing the book by Frank and Cook, John Kenneth Galbraith (himself an opponent of economic inequality) wrote,

The problem is that a good point is carried to extremes—generalized well beyond its reach. This is not a winner-take-all society; rather, it is an economic world in which the case the authors describe plays an interesting but far from dominant role. No wheat grower, no dentist, no housepainter has a dominant position in his or her industry. Athletics, which is the authors’ starting point and to which, rather significantly, they frequently return, is programmed to produce a clear-cut winner; not so for many other activities, even where there is considerable market concentration. I recently looked into the matter of automobile excellence. I came away from the search almost completely innocent as to which might be the best—or the best for me. The fact that so many companies—U.S., Japanese, German, Swedish—all compete and survive goes far to refute the idea that there is any clear winner in automobiles, that there is any serious chance that one will soon take most, let alone all.

As business ethicists usefully remind us, the really chewy dilemmas don’t involve choices between good and evil, but between two goods. In the case of the winner(s)-take-all phenomenon, we see our values of fairness (or social good) pitted against merit (or individual good.) It is argued that the winner(s)-take-all markets divert rewards to the apparent winners on the basis of attributes other than merit and function to the detriment of the also-rans. Here, we confront the definition of “merit” and “detriment” and how they are measured. Again, we are stuck in Potter Stewart-land.

So what?

You can debate the impact of the winner(s)-take-all phenomenon, but I would advise you not to deny its existence or relevance. Business students are making career choices this season. And it looks like the secondary market for talent (judged by headhunter activity) is heating up. Several different entrepreneurs have whispered to me that they are about to launch new businesses. In these and other contexts, relative positioning can matter a lot—and this means that you face potential asymmetric payoffs characteristic of winner(s)-take-all. Such markets are clearly not for the faint-of-heart: the failure rate is very high; the field will likely be crowded; competitors probably overinvest beyond rational bounds; competition may grow intense and even unethical; and ultimately the difference between the winners and the rest may be scant.

I’ll have more to say about the winner(s)-take-all phenomenon in future posts. But here are a few generic questions to consider as you peer into the unknown right now:

  1. In the place to which I’m headed, how important in their evaluation will be will be relative performance versus absolute performance?
  2. On what basis is performance assessed?
  3. In producing such performance, how significant are effects such as reputation/branding, lock-in, status, mass-markets, and deep pockets?
  4. How crowded is the field of competition?
  5. How have the rewards been distributed in the past? How asymmetric is that distribution?
  6. How much transparency is there regarding the distribution of rewards?
  7. And the really big one: How much time, talent, and treasure am I willing to invest in an effort to win?

Jerry Seinfeld’s riff on the Olympics is funny on one level. But as psychologists tell us, there is often a kernel of anger within humor. No doubt, Adam Nelson knows. Nelson (Darden MBA 2008) won the Silver Medal in the 2004 Olympics, in the shot put event. Then, in May 2013, the International Olympic Committee awarded the 2004 Gold Medal to Nelson when it was revealed that the apparent previous winner was guilty of drug doping. The Associated Press quoted Nelson a year ago: “It’s not just a victory for me, but a victory for the system. I can’t dwell on what happened or didn’t happen eight years ago. I can only look forward to what the next phase in life brings. At least now I can do that with a Gold Medal.” Or, as Seinfeld said, “you win the gold, you feel good.”

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Living into the challenge: A Reflection on the Life of Dr. Martin Luther King, Jr.

A great deal has been written about how leaders transform those around them. Rather less is said about how transformations change leaders too. The life of Dr. Martin Luther King, Jr. gives an important insight into the latter: one must “live into” one’s challenges. This affords a valuable reflection today, when we honor King’s memory.

In the spring of 1960, Martin Luther King could look back on a few years of struggle against racism and wonder whether it had been worth it. Many of the most transformational changes on which he is known to have had great influence, lay ahead, later in the 1960s—the Civil Rights Act, Voting Rights Act, and War on Poverty, and most importantly a shift in public opinion against racism. As of 1960, King and his followers had made great sacrifices on behalf of their cause. But was it worth it? King took stock of his experience and wrote,

Due to my involvement in the struggle for the freedom of my people, I have known very few quiet days in the last few years. I have been arrested five times and put in Alabama jails. My home has been bombed twice. A day seldom passes that my family and I are not the recipients of threats of death. I have been the victim of a near-fatal stabbing. So in a real sense I have been battered by the storms of persecution. I must admit that at times I have felt that I could no longer bear such a heavy burden, and have been tempted to retreat to a more quiet and serene life. But every time such a temptation appeared something came to strengthen and sustain my determination. [1]

How King confronted the adversity of his calling warrants reflection. He wrote,

My personal trials have also taught me the value of unmerited suffering. As my sufferings mounted I soon realized that there were two ways that I could respond to my situation: either to react with bitterness or seek to transform the suffering into a creative force. I decided to follow the latter course. Recognizing the necessity for suffering I have tried to make of it a virtue. If only to save myself from bitterness, I have attempted to see my personal ordeals as an opportunity to transform myself and heal the people involved in the tragic situation which now obtains. I have lived these last few years with the conviction that unearned suffering is redemptive…. The suffering and agonizing moments through which I have passed over the last few years have also drawn me closer to God. [2]

To borrow a phrase from my friend, Jim Baker, Martin Luther King “lived into” his ordeal. The concept of living into a challenge is hugely important to the development of leaders. To “live into” something is to go beyond intellectualizing it: you must practice it, embrace and accept the consequences, learn from them, and go on. King is not alone in this. Consider three other examples:

  • Gabrielle Giffords lives into her tragic assassination attempt with a new sense of purpose about gun control. She wrote recently: “I’ve spent the past three years learning how to talk again, how to walk again. I had to learn to sign my name with my left hand. It’s gritty, painful, frustrating work, every day. Rehab is endlessly repetitive. And it’s never easy, because once you’ve mastered some movement or action or word, no matter how small, you move on to the next. You never rest. I asked myself, if simply completing a normal day requires so much work, how would I ever be able to fulfill a larger purpose? The killing of children at the school in Sandy Hook a little over a year ago gave me my answer.”
  • Helen Keller lived into her deaf-blind condition by becoming a leading writer and advocate for people with disabilities. She wrote, “Character cannot be developed in ease and quiet. Only through experience of trial and suffering can the soul be strengthened, ambition inspired, and success achieved….All the world is full of suffering. It is also full of overcoming.”
  • Viktor Frankl found purpose even in helping others in their struggles at Nazi death camps during the Holocaust. In his classic book, Man’s Search for Meaning, Frankl wrote, “We who lived in concentration camps can remember the men who walked through the huts comforting others, giving away their last piece of bread. They may have been few in number, but they offer sufficient proof that everything can be taken from a man but one thing: the last of the human freedoms — to choose one’s attitude in any given set of circumstances, to choose one’s own way.” He added, “If there is meaning in life at all, then there must be meaning in suffering.”

One could cite many other possible examples: Gandhi, Mandela, and Solzhenitsyn, to name a few.

Of all of these exemplars, Martin Luther King explains perhaps best what it means to “live into” a challenge: it is to “transform the suffering into a creative force…to make of it a virtue.” The reason that this is an important lesson is that it illuminates a foundational idea about learning and human development: one grows profoundly through experience rather than observation. The next generation of leaders who have the depth of character and impact of King and other exemplars will likely draw not only from what they learned, but how.

I have written about the types of knowledge one might want to acquire, and how they can best be delivered. Explicit knowledge (names, dates, formulas) is easily absorbed from readings, lectures, MOOCs, simple problem sets, etc. And then there is tacit knowledge, the stuff that is gained by feel. An important aspect of tacit knowledge is that one learns by doing, ideally in collaboration or under mentorship by others. Explicit knowledge can be stored in libraries and on hard drives; tacit knowledge cannot. Skills such as bicycle riding, kneading bread, mastering a musical instrument, suturing a wound, public speaking, interviewing for a job, negotiating and selling reflect tacit knowledge—you can read all you want to about these skills, but you’ll only master them by doing them. In other words, you’ll only master them by living into them.

Martin Luther King was highly educated for leadership; but he really learned to be a transformational leader by living in to the struggle against racism. His example helps aspiring leaders to anticipate their own growth path: find the creative kernel in any struggle; make it a virtue; live into the challenge. This Martin Luther King, Jr. day in 2014, is a worthy moment to pause and reflect on the sources of your own growth.

  1. “Suffering and Faith” Christian Century, April 1960. []
  2. ibid. []
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