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Now Comes The Corporate Triathlete


Science & Technology

NOW COMES THE CORPORATE TRIATHLETE

It sounds like a typical business-school case study: Five students looking for ways to market an ultrasonic device that drives whales, dolphins, and seals away from fishing nets. But this exercise at Northwestern University's J.L. Kellogg School of Management last year was real business--and the marketing plan was just one of the team's challenges. The five--all headed for manufacturing--first designed, engineered, and built the $20 machine, then tested and refined it in experiments with beluga whales at a Chicago aquarium. Now, they're trying to find a buyer.

At business schools from Wharton to Berkeley, a new kind of MBA is emerging: one with dirty--and sometimes wet--hands. By combining courses from engineering, computer science, and business schools into one curriculum, some of America's top universities are producing corporate triathletes.

These are managers made to order for the new horizontal corporation--people who not only understand the basics of marketing, accounting, and finance but also have a feel for computers and the other technologies that help companies deliver their products or services.

Call them techno-MBAs. Right now, they number only about 3,000 of the 75,000 MBAs who graduate each year. But corporate recruiters are gobbling them up at such a rate that B-schools are rapidly adding computer and engineering courses to their core curriculums. "We're dissolving the boundaries between marketing and manufacturing," says James I. Cash, chairman of Harvard University's MBA program.

Actually, engineers have long pursued MBAs--traditionally making up 15% to 25% of most B-school classes. But the schools always regarded engineering and business as separate disciplines. Now, they're bringing them together. Leading the movement are B-schools at universities with an engineering bent, such as Massachusetts Institute of Technology, Purdue, Carnegie Mellon, Rensselaer Polytechnic, and Lehigh. Many are mimicking big companies by putting students into the kind of cross-disciplinary teams that Chrysler Corp. used to develop its new Neon subcompact. At Chrysler, designers, engineers, and plant managers work hand in hand with colleagues from finance, marketing, and human resources. At Purdue's Krannert Graduate School of Management, students are put into similar multiskill groups to work on case studies.

STAGE FRIGHT. At the same time, business schools with high concentrations of engineers, such as Carnegie Mellon, are trying to give these students skills they'll need to move from the lab to the corner office. The theory is that students with "soft" skills, such as communications, often rise to the top, while those with only "hard" technical skills stay in the lab. "Technologists suffer from stage fright," says Robert Sullivan, dean of Carnegie Mellon University's Graduate School of Industrial Administration, where two-thirds of the students have science and technical backgrounds. "We would like them to take a leadership position." To this end, CMU is enlisting its Fine Arts Dept. to teach a new course this semester: Business Drama, a mixture of plays, comedy, and improvisation. Some 150 students--75% of the CMU business class--have signed up.

Plenty of mainstream programs, including those at Wharton, the University of Texas, Berkeley, and Stanford, are also infusing their B-school curriculums with engineering and computer courses. And they're finding that the new programs pay off in job offers. Recipients of Northwestern's three-year-old master of management in manufacturing get twice as many job offers--five per student--as regular MBAs from the Kellogg School. "Our placement rate was phenomenal," says Caleb Tower, a Kellogg student who helped develop the whale alarm and is now a manager of operations at Bantam Doubleday Dell in New York.

At Texas, where 25% of 400 new MBAs left school last spring without a job, the 25 graduates of the B-school's Informational Systems Management program averaged 3.5 offers each, most of them in the $50,000 range. The ISM program "nailed it," says Bennett Smith, an ISM grad who now develops strategic information systems for Federal Express Corp. Next fall, Texas' B-school is planning to bring 100 more students into the technology loop.

The move to create techno-MBAs began in a 1986 meeting at the National Academy of Engineering in Washington. There, representatives of leading U.S. companies, including IBM, Boeing, and General Electric, met with academics to discuss Japanese inroads into U.S. markets. The problem, the executives complained, was that many recent MBAs didn't understand the high-tech products their employers made. Worse, they hadn't mastered computer technologies, from robots to e-mail, that were essential to operations. It became clear that grads "needed a strategic understanding of technology as a source of competitive advantage," says Lehigh University professor Alden S. Bean, who attended the meeting.

CONVERTS. This idea got a boost in the early '90s, when the recession tarnished the glitter of an MBA and B-schools had to start scrounging for applicants. Meanwhile, U.S. companies were shrinking and restructuring. They were shopping for fewer MBAs--and looking for those with engineering and computer skills. "We kept hearing from recruiters that you have to break down the walls," says Mark Zupan, associate dean of masters programs at the University of Southern California. And engineering students needed a place to fit in. As the cold war ended, defense contractors and government labs shifted their focus from weapons development to defense conversion. Prospective engineers saw a sudden need to gain skills in such disciplines as marketing and finance.

Now, the challenge facing techno-MBA programs is to integrate business and technology more thoroughly. At the Rensselaer School of Management, professors are combining marketing with new-product development and blending accounting with performance analysis, a key discipline in Japanese-style "continuous improvement." In designing these courses, teachers work closely with corporate executives, who view the programs--and their graduates--with a near-proprietary interest. Among the companies Rensselaer works with, says Management School Dean Joseph G. Morone, are Pitney Bowes, General Electric Information Services, and computer-networking company Wellfleet Communications. Such allies are often headed by alumni, such as Wellfleet CEO Paul J. Severino. What he wants, he says, are technologists "who have a good idea of what business is all about."

INFORMATION EDGE. Many technology offerings focus on the computer, as a tool and as a market. Purdue, for example, offers a course exploring products and services that might be sold over Internet, the vast computer network. And Texas is focusing its program on the management of information services. As companies migrate from mainframe to desktop computers, they'll require a new generation of technologists with the business savvy to do the rewiring, says Timothy W. Ruefli, director of Texas' ISM program. Enhanced information processing is "where the productivity's going to come from," he says. Federal Express seems to agree: It offered jobs to 14 of Ruefli's 25 graduates last year.

The techno-MBA programs are such potential money-makers that B-schools want to expand the market with mid-career courses. But trimmed-down companies are reluctant to part with up-and-comers for long. So B-schools are going high tech. MIT is recruiting a handful of companies to enroll 10 students each in a new joint-degree program run by the Sloan School of Management and the School of Engineering. Except for short summer and winter sessions in Cambridge, the students would keep their jobs and work with professors and classmates via interactive video. Ultimately, Sloan School Dean Glen L. Urban sees a "worldwide network connecting students in Singapore, Seoul, and Washington." He imagines 10 Boeing Co. students, for example, collaborating with 10 from Toshiba Corp. on complex systems-design problems.

Such a program could well become a case study of how popular the techno-MBA will become. Texas' Ruefli calls his grads "agents of change." In the corporate world, that remains to be seen. In business schools, it's already true.

WHY TECHNO-MBAs?

-- As companies go from vertical to horizontal, they want cross-disciplinary managers

-- Techno-managers can help smooth the transition from mainframe to personal-computer systems

-- B-schools, facing declining enrollments, are searching for more students--and finding them in engineering and computer science

-- With pure research on the wane in the post-cold-war period, engineering schools are pushing students into business courses

GRAPHIC BY ROB DOYLE/BWStephen Baker in Pittsburgh, with Gary McWilliams in Cambridge


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