HBS’s Technology Skill Set Gap
“One of the things about IT is that people want to shed it and make believe it’s not their responsibility. There’s a temptation to outsource it and get rid of it and leave it to the experts to take care of. Business people need to be systems literate.” – Jamie Dimon, Chairman, President, & CEO of JPMorgan Chase
HBS teaches us the basics of accounting – not so we can become accountants, but so we can hire, work with, and ask intelligent questions of CFOs. The same is true for the basics we learn in finance, marketing, and operations. However, there is a blind spot when it comes to our ability to work with CIOs and CTOs. Namely, HBS grads are ill-equipped to work with and communicate effectively with IT-oriented members of the C-suite. In a recent survey we found that while 97% of students understand DCFs, only 14% could tell you what a relational database is. As leaders of tomorrow’s companies, why should we care?
Information technology has infiltrated the senior ranks, becoming an integral part of building competitive advantage, securing information, understanding clients, predicting trends, and increasing productivity. As a result, it has become increasingly important that IT decisions be made at senior levels.
You have to look no further than the Healthcare.gov debacle to appreciate the level of senior involvement necessary in IT decisions. Kathleen Sebelius (one of Forbes 100 most powerful women and Time Magazine’s top 5 governors in America) now faces calls for resignation from her Health Secretary post after being insufficiently aware of the problems with the healthcare site.
“I think I would do better at my job if I had more of an engineering background myself. I think having a technical background, not just in the technical industry, but to lead any industry is so important,” said HBS alum Sheryl Sandberg in her Grace Hopper keynote this year.
Our peers and colleagues are also becoming increasingly technical. Intro to Computer Science (CS50) has become the second most popular course at Harvard, with enrollment doubling since 2010 to 759 students this Fall.
How HBS Lost Its Tech Lead
Today the RC curriculum’s technology cases focus on assembly lines and fundraising valuations. Noticeably absent are technology fundamentals such as the basic how-tos of Internet technology (how many servers does the NFL need to stream a football game live?), cybersecurity (how should a company secure data and interact with the NSA?), and big data (how can Target predict that a customer is pregnant?).
Back in the ’80s, HBS was ahead of the technology curve. In fact, HBS used to have a required first year course “Information, Organization and Control”, which among many things pioneered that students learn to use e-mail. Our business school was also the first in the nation to require that students own a personal computer. At this time, HBS had yet to create official faculty departments, and the IT interests were spearheaded by a small group of professors including Professor Lynda Applegate, Professor Emeritus Warren McFarlan, Professor Emeritus Jim Cash, and Professor Emeritus Jim McKenney. When HBS officially created departments, the debate arose as to whether the IT efforts should continue standalone. Ultimately, they were folded into the Production and Operations Group (POM), which was then rebranded as TOM.
HBS’s roots in POM explain the focus on assembly lines. Administration also argued that IT was fundamental enough that gaps in the material could be integrated into each individual HBS department. Decentralization was a promising idea in theory, but in practice it meant little uptake on technology-focused curricula. Each department is incentivized to hire the best in their respective fields, which means that IT expertise often falls through the cracks. Second, the case method encourages faculty to write and teach cases from their expertise. This means that few IT-focused cases are written to refresh the curriculum. Finally, the demanding tenure requirements and faculty evaluations give little reward to junior faculty for experimenting with alternative instruction (e.g. hosting a j-term class dedicated to IT).
Today, pieces of IT curricula are taught through promising EC courses, such as Professor Ben Edelman’s The Online Economy, Professor Karim Lakhani’s Digital Innovation and Transformation, Professors Sunil Gupta and John Deighton’s Digital Marketing Strategy, and Professors Jeff Bussgang and Tom Eisenmann’s Launching Technology Ventures, among others. The challenge, however, is that elective curriculum is, by design, self selecting, and therefore draws students who often already have experience with the field. This contrasts other business schools, which have integrated IT into their required first-year courses. MIT Sloan, for instance, requires that all students take “Data, Models, and Decisions”, and Stanford GSB requires “Information Management”, the latter whose syllabus states: “Knowledge of technology (computing, networks, software applications, etc.) is a prerequisite for a successful manager.” HBS students have begun to see this hole as well. When given the course descriptions for TOM and an IT-focused course, 47% of HBS students said an IT course would better prepare them to lead a company than the broadest definition of the current TOM course.
After interviewing 26 alumni, staff, students, and faculty, a number of IT concepts emerged as vital to leading tomorrow’s companies.
First is understanding the potential of technology. All of us have heard people say “the technology makes me do it this way” or “engineering said it cannot be done.” As Jim Sharpe (HBS ‘76, Chairman/Owner of Extrusion Technology and current HBS EiR) stated, “technological aversion is often treated as an opportunity to delegate. But a distinguishing characteristic of a successful leader is recognizing that IT can enhance the capabilities of the company to provide value to customers…what it takes is becoming personally fully engaged in understanding and driving the technology platform.” Successful leaders have used technology to create an edge in efficiency, customer service, and streamlined organizations.
Second is understanding basic technology architecture, the equivalent of accounting’s fundamental accrual/cash accounting. For instance, one alumni mentioned that MBAs need a basic understanding of computer and network technologies, operating systems, applications, and interfaces to then understand issues related to data and network security, cloud computing, and big data.
Third is understanding predictive analytics. Processes today generate far more data than Excel can handle, and analyzing this data is critical for understanding customer behavior (“what % of consumers who bought Dove also looked at Axe?”) and efficiencies (“which groups should our sales force target?”).
Finally, it’s essential that we learn the CIO and CTO’s perspectives. Today the HBS curriculum gives us powerful insights into CFOs and CMOs, but multiple alums observed that noticeably missing is the CIO and CTO perspective.
Integrating these concepts will require both student and faculty support. From students, the newly created Big Data & Analytics Club has been running SQL introductions, other students are self-organizing coding workshops, and we are currently working to create a speaker series with the MCC, WSA, and Marketing clubs to introduce IT concepts in non-tech industries.
But to get these concepts to stick, we need them in RC courses. It’s inexcusable that the curriculum today fails to cover the implications of technology for management, strategy, and organization, fundamental to accurately reflecting the real world for tomorrow’s leaders.