Are MBA Programs Disruptive Enough?

Disruption once had a negative connotation. It meant you were causing a ruckus and interrupting something, presumably something important. No one wanted to be a disruption in class, for example.

Now, however, being disruptive is a goal of business champions. Disruption is a badge to proudly wear on one’s sleeve. The word is repeated ad nauseum in television news and in print in newspapers, magazines, and websites. Schools – well, business schools anyway – are encouraging disruption. After all, disruptors are the ones changing the world. They are responsible for the next big thing, whatever that will be.

Recently, University of Toronto Rotman School of Management released the Winter 2018 issue of the school’s magazine with “Creative Destruction” on the cover.

In the magazine’s opening story, “Moonshots: Achieving Breakthrough Innovation in Established Organizations,” Anita M. McGahan, Rotman chair in management and professor of strategic management, explains that this idea of disruption refers to theoretical concepts by Joseph Schumpeter that took shape starting in the 1930s.

“These ideas were rooted in Schumpeter’s observation that, in many industries, when technological advances created the potential for business-model innovation, pioneering firms that had achieved leadership in their industry were often unable to adapt,” writes McGahan.

More recently, she adds, Harvard Business School professor, Clayton Christensen wrote The Innovator’s Dilemma, which showed that “the leading customers of large organizations often discourage large companies from adapting technologically.” Change is hard for everybody, in fact. But what the world is witnessing is death to the stagnant. So, change may be hard but death is worse. Suddenly, becoming the disruptor is the goal as a means of survival.

Disruption is a way of life at MIT Sloan School of Management (and arguably all of MIT). It’s ingrained in the culture of the place, says Trish Cotter, associate managing director of Martin Trust Center for Entrepreneurship at Sloan. She is always reminding people that MIT students are encouraged to use disruption to change the world in a meaningful way, and not to just come up with the latest dating app, or means of getting fast food faster.

“We want to solve the world’s problems,” says Cotter. “We attract some of the world’s most brilliant minds. We must create an environment that helps them develop ideas that haven’t been imagined yet.”

Sloan offers students all sorts of help testing startups, including money, research, and frameworks for looking at problems in new ways. You can learn more about how schools, including Sloan, teach entrepreneurship in “Why Business Schools Are Investing in Students’ Start-Ups.”

While disruption is its bread and butter, Sloan and Cotter prefer the phrase “disruptive strategies.” Cotter says this was coined by MIT professor, Pierre Azoulay, and refers to flying under the radar to see if you can make entry into a market with an innovation, that could potentially bust up whatever is already there. The point Cotter is trying to make when referring to “disruptive strategies” is that companies, such as Netflix and Uber had no idea what influence their success would have on movie rental houses and cable, or public transportation and taxi drivers respectively.

“No one knows how the story will turn out,” she adds. “And you have to be okay with that.”

At Babson College, which is known for its bent toward entrepreneurship, students can take the course “Disruptive Change and Enterprise Transformation.” Professor of Marketing Anirudh Dhebar says the highlight of the course is a three-day interactive, executive-style workshop.

“Here, students will learn to make sense of the driving trends, disruptive forces, and unhinging uncertainties contributing to massive ecosystem-wide change, envision alternative scenarios for the future, identify implied strategic imperatives for an incumbent enterprise of their choice, and explore necessary transformations in the enterprise,” says Dhebar. “Student learning will be facilitated by a hands-on, integrative approach that seamlessly weaves together concepts and tools from the MBA core curriculum as well the disciplines of entrepreneurship, innovation, technology, finance, marketing, operations, leadership, strategy, social concern, and sustainability.”

Bryan Routledge, professor at Carnegie Mellon University Tepper School of Business, will teach FinTech from March 2018. In this class, he will cover how technology is disrupting finance with specific instruction on how to deal with market forces, such as artificial intelligence and machine learning.

“To prepare students for disruption, teach the ‘why’ and not just the ‘what.’  Fintech is not just ‘banking,’” says Routledge. “Understanding FinTech requires monetary economics, mechanism design, mathematics, [and so on]. To prepare students to do the disruption is harder.  It requires teaching not just the ‘why,’ but the ‘why not.’”