The Reality of Strategy: The Case of London Business School

English: London Business School facade

English: London Business School facade (Photo credit: Wikipedia)

When Laura d’Andrea Tyson was the Dean of London Business School – some years ago – she put together a committee to examine and reformulate the School’s strategy. Several professors sat on that committee. When I once asked her, having a drink at her home, why none of them were Strategy professors, she looked at me for about 5 seconds baffled. Eventually, she stammered, “yes, perhaps we could consider that in the future….”.

It was clear to me, from her stunned silence (and she wasn’t easily lost for words), that she had never even considered the thought before.

I, in contrast, thought it wasn’t such an alien idea; putting some strategy professors on the School’s strategy-making committee. We had – and still have – people in our Strategy department (e.g. Costas Markides, Sumantra Ghoshal) who not only had dozens of top academic publications behind their names but who also had an eager ear amongst strategy practitioners, through their Harvard Business Review publications and hundreds of thousands of business books sold (not to mention their fairly astronomical consulting fees).

 Today, our current Dean – Sir Andrew Likierman – is working with a group of people on a huge strategic growth decision for the School, namely the acquisition of a nearby building from the local government that would increase our capacity overnight with about 70 percent. Once more, strategy professors have no closer role in the process than others; their voice is as lost in the quackmire as anyone else’s.

If Sir Andrew had been an executive MBA student in my elective (“Strategies for Growth”) writing an essay about the situation, I would ask him for a justification of the need for growth given the characteristics of the market; I’d ask him about the various options for growth (geographic expansion, e.g. a campus abroad; related diversification, e.g. on-line space, etc.), and how an analysis of the organisation’s resources and capabilities is linked to these various options, and so on. But a systematic analysis based on what we teach in our own classrooms and publish in our books and journals has, it seems, not even be considered.

And I genuinely wonder why that is? Because it is not only strategy professors and it is not only deans. Whenever the topic of the School’s brand name comes up, no-one seems inclined to pay more attention to our Marketing professors (some of whom are heavyweights in the field branding) than to the layman’s remarks of Economics or Strategy folk. When the School’s culture and values are being assessed, Organizational Behaviour professors are conspicuously absent from the organising committee (ironically it was run by a Marketing guy); likewise for Economics and OB professors when we are discussing incentives and remuneration. So why is that?

Is it that deep down we don’t actually believe what we teach? Or is it that we just don’t believe what any of our colleagues in other departments teach…? And that it could be somehow relevant to practice – including our own? Why do we charge companies and students small – and not so small – fortunes to take our guidance on how to make strategy, brands, and remuneration systems only to see that when our own organisation is dealing with them it all goes out the door?

I guess I simply don’t understand the psychology behind this. Wait… perhaps I should go ask my Organizational Behaviour professors down the corridor!

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ADDENDUM

Since writing the piece below – perhaps not surprisingly; although it took me a bit by surprise (I didn’t think anyone actually read that stuff) – Sir Andrew contacted me. One could say that he took the oral exam following his essay on the School’s growth plans and passed it (with a distinction!). 

In all seriousness, in hindsight, I think I was unfair to him – perhaps even presumptuous. I wrote “a systematic analysis based on what we teach in our own classrooms and publish in our books and journals has, it seems, not even be considered” and, now, I think I should not have written this. That I haven’t been involved in the process much and therefore have not seen the analysis of course does not mean it was never conducted. And it is a bit unfair, from the sidelines, to throw in a comment like that when someone has put in so much careful work. I apologise! 

In fact, although Sir Andrew never lost his British cool, charme and good sense of humour, I realise it must actually have been “ever so slightly annoying” for him to read that comment, especially from a colleague, and he doesn’t deserve that. So: regarding the specifics of this example: forget it! ban it from your minds, memory, bookmarks and favourites (how would this Vermeulen guy know?! he wasn’t even there!)!

That you should pay more attention to Marketing professors when considering your school’s brandname, more attention to your OB professors when considering your incentive systems and values, more attention to Finance professors when managing your endownment and, God forbid, sometimes even to some strategy professors when considering your school’s strategy, I feel, does stand – so don’t throw out the baby with the bathwater just yet. But, yes, do get rid of that stinky bathwater.


18 Comments on “The Reality of Strategy: The Case of London Business School”

  1. Amit Kapoor says:

    Some additional views on what is wrong with Business School Faculty in India at http://www.livemint.com/2012/06/14222023/Redefining-business-school-fac.html

  2. Chen says:

    Dear Professor Vermeulen, I believe what you described here was not only happened in LBS,

    Our university ask each Colleges and individual departments to provide its SWOT analysis, but it really hard to see any proactive invitation to ask professors in the field of strategy, even just invited those senior ones, to join such analysis work, in spite of asking some ex post counselling and confirmation of their content.

    The reasons may include tight deadline and imply that each professor in the College of Management/Business should aware about ideas of SWOT and can do that well.

    Of course, all these reasons exclude political concerns or ideas of resource dependence.

  3. RussCoff says:

    It is also worth noting that Finance faculty are not often brought in to manage the school’s endowment (though it does happen occasionally). Strategy scholars are not the only one’s to be slighted…

    • David Hoopes says:

      That’s a great point Russ. We’ve all been at schools where the finance profs had handled huge and successful portfolios. Aside: at my alma mater Grinnell College, they enlisted successful businessman (scientist, alum) Robert Noyce. He asked friend Warren Buffet along. Warren converted Grinnell’s good endowment into one the country’s largest.

  4. Entrepreneurs and Managers are very confident in unformal planning processes and almost always they think formal planning and analysis are too complicated, slow and costly… In an organization like a university additional factors in terms of power and internal politics must be considered. Knowledge (about strategy in this case) could be a matter of fear to the Manager because he/she could be afraid about loosing power.

  5. srp says:

    I know of at least one business school where a focused strategy recommendation (a set of coordinated initiatives to improve the quality of graduates’ jobs) from a committee led by an expert was ignored in favor of the usual “more ethics, more global, more diversity, more community involvement” stuff. Most of the time these faculty committees are pretend exercises in consultation, with the desired outcome predetermined by the dean or whomever is in charge.

  6. Neil says:

    I think that the issue is that they don’t consider themselves a “business” and so business tools do not apply. Which is ridiculous, as the same principles apply. They have an objective, a limited amount of resources and clients (students – or should be, some believe that the Board of Directors is their client).

  7. Very few professional managers want to be deans. I think many deans just want personal power. Excluding the part of the organisation that possess knowledge is their way to increase their personal feeling of being powerful.

  8. Joel West says:

    At my previous employer (a state university), I had to sit when some flunky in the PR department was lecturing one of our marketing professors (one who teaches marketing communications) on the principles of branding. Neither of us could really hold our temper.

    That was a university with 2,000 faculty. At my current, more entrepreneurial college (with 15 faculty), when there were no strategy faculty on the president’s strategic planning committee, I volunteered — at the cost of attending lots of meetings.

    This pattern seems to reflect the classic Mintzberg critique of top-down strategic planning. There is an assumption that top managers either know what needs to be done, or on their own can pick the right people to make these decisions. As Mintzberg has chronicled, in highly uncertain environments specialized knowledge will be found closer to the front lines.

  9. Corey says:

    Perhaps, schools are, simply, poorly run.

  10. davidburkus says:

    I think the school likely worries its ideas will be over-run. Universities around the world seem to be constantly dealing with the tension between administrators and tenured-experts. It’s a lot easier to ease that tension when one part isn’t in the room.

  11. […] Resulta que la London Business School construye su estrategia sin contar con los profesores de estrategia. […]

  12. ProfDC says:

    I think the administration and the expert profs have gotten into a bad equilibrium. If strategy profs are outspoken opponents of the current strategy (or marketing profs of the current marketing, etc.) and lambaste the administration for not consulting them, they’re not particularly good choices as additions to the committee even if, in hindsight, it would have been a good idea to include them. The humble “I hope you would consider me for membership on the committee, where I think I could contribute” approach is much more likely to work than waiting for the phone to ring.

  13. David Hoopes says:

    At many universities the business school is looked down on. Of course, you wouldn’t think this would be true at LBS.

  14. […] The Reality of Strategy: The Case of London Business School […]

  15. James Hewitt says:

    Air pollution in the vicinity of the Marylebone Town Hall is consitently amongst the worst in the UK – and often below the minumum deemed acceptable under EU law. This will of course deter prospective students and staff. Consequently, it would be very helpful if LBS – staff and students, past and present – were to use their considerable potential to ensure that the public authorities (particularly the GLA) improve road transport as a matter of urgency, at least locally. Doing so would help LBS both demonstrate its efforts to minimise climate change and optimise its marketing and development strategies.

  16. […] Resulta que la London Business School construye su estrategia sin contar con los profesores de estrategia. […]


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