Big Red Synergies?Posted: February 2, 2016
Debates over corporate scope–synergies v. focus–have become staples of the business pages. Activist investors keep turning up, demanding greater business focus and less sprawl across industries and activities. Management teams either acquiesce (Xerox, HP, DuPont-Dow) or resist, following their passion for synergy-seeking (Agrium, Siemens, Yahoo). Now we have an interesting meta-case of a university seeking greater synergy in business education, as Cornell’s top management group–president, provost, and board of trustees–forces a merger of the School of Hotel Administration, the Dyson School of Applied Economics and Management, and the Johnson School of Business into a new and improved College of Business.
There are only two problems with this merger: Process and substance. The action was admittedly taken without consultation with alumni or faculty and announced as a fait accompli. Some of the alumni of the Hotel school (among whom are a few large donors) and of the Dyson school are hopping mad about having their degrees and identity dissolved into a pool with the far less successful Johnson School. Faculty are reported to be equally disturbed at this change.
Substantively, the merger has only the weakest of rationales: Each school is to be kept as a separate unit with its own dean, its own control over curriculum and admissions, and a mandate to keep its own “identity and mission.” So why bother to “merge” them? How’s this for an explanation:
“For a top-tier university like Cornell, an outstanding and integrated business program … is necessary for success,” they wrote. “Students and faculty need to engage with the economy and business, as well as collaborate with other disciplines.”
If they just want to run some interdisciplinary programs, adding a new bureaucratic layer at the College level with its own dean, staff, etc. seems wasteful. If they plan to save substantial money by using shared staff while maintaining separate curriculum, admissions, PR, and development processes, one can only inquire as to the color of the sky on their planet. The dark suspicion of many Hotel and Dyson constituencies is that this is an attempt to help Johnson by yoking it to its more-successful brethren while dragging them down via brand dilution.
Ah, synergy! Base impersonation and flights of fancy oft becloud thine honest virtue!