Training future economic crisis managers: a relevant challenge for MBAs

By Matthias de Larminat, Global MBA student 2012-2013, France

Crises, be they economic, financial, health, or security related often require that we find innovative, concrete and quick solutions. The emergency acts as a booster to change. In extreme situations, such as facing hurricane Katrina in Florida or systemic financial failure, given the stakes, transformation becomes a vital necessity. Facing the ultimate crisis, there are obviously no more written rules; it is easy to go out of the box given that as standard answers become totally irrelevant, all assumptions and rules run out of scope.

Because of this, one could question the relevance of an MBA, which provides standard training. In other words, should we change the business leaders given the natural bias of reproduction and risk avoidance?

Indeed, one must acknowledge that the current economic and financial crisis look like a storm and tsunami combined, defeating icons of a certain world such as Lehman Brothers. During this time, no Churchill has emerged to save the old world from collapse. Europe seems unglued in recession without a clear roadmap. Military history illustrates that very often, war times start with the replacement of peace time military hierarchy by a real war lord. Why should it be different for business? Can we really train at the same time and in the same way leaders for growth times and for crisis periods?

Crisis times, characterized by high uncertainty, high-risk and a fast-moving environment, necessitate atypical profiles, with a vision fueled by strong character and values. Of course academic knowledge is still a requisite, but it is just the first level of the pyramid. Some voices advocate for a strong update of current MBA foundations in order to avoid reproducing the Western way of doing business. ESSEC’s recently launched Global MBA has taken this road by focusing on unusual courses such as sustainability and incorporating immersion in emerging areas, which enables students to integrate best practices and lessons learned from alternate and successful models.

However, going deeper in the analysis, economic growth is highly cyclical, never linear.  As a result, wherever future international managers will work, they will face crisis and slowdown. They should be trained to face it. In this way it is striking to see that traditional MBA literature is mainly focused on growth and expansion strategy, and that few books, few courses and little  training is designed to address strategies for times of crisis.

Doubtless, this gap will be rapidly filled, integrating takeaways from current and past bankruptcies or failures. It is not pessimistic to anticipate strategies for bad weather; it is simply the principle of reality! Driving in bad, windy and rainy weather is always more challenging. Our world has an urgent need for drivers to weather the storm!

Getting out of Our Comfort Zones

By Matthias de Larminat, Global MBA student 2012-2013, France

Entering a business school I never thought that I would get so close to poverty; I was more prepared to meet Bill Gates or other rich and successful leaders. But our team, driven by great interest for a  sustainability course, went to Indonesia to visit the Bottom of the Pyramid: a powerful life lesson!

From books to terrain

While planning our Hult Prize competition, which aims to addres food issues in slums, two other students (Matthew and Reita) and myself took advantage of our six weeks in Singapore to leave the luxury shopping malls of Orchard Road for the poor slums of Jakarta. Very concerned about having a clear picture of what is happening on the ground, our goal was to identify needs and the opportunities. The realities faced required us to test our ideas, born in a comfortable office in Paris. The goal of feeling what daily life is like in a slum was more than fulfilled, and we came back fired with motivation to address the issue of food.

Not your typical tourist junket

Did you know that Indonesia, and Jakarta especially, are famous for having initiated tourism into slums? Making money from exposing people struggling in life was not an appealing concept, so we opted for a totally different approach as we wanted to experience this life fnot as tourists. We went for a real immersion, benefiting from the fact that Reita, our teammate, is originally from Jakarta. Her two brothers took us, offering real insight. Given security issues, we were also escorted by a friend of the family, very familiar with slum dwellers, who acted as a bodyguard.

This immersion turned out to be an amazing experience. As soon as we entered the slum we were surrounded by a crowd of kids. Unlike many touristic locations where they are used to seeing foreigners and harass them for some coins, here there was no begging, just curiosity and joy at seeing “different people” coming to see them. It was a totally disinterested attitude. We felt strong emotions seeing their smiling and very warm attitude in spite of their extreme poverty, which differs so much from the often blasĂ© attitude of kids in developed countries. There were no complaints. They take life as it is, and this a  valuable lesson for us. At the same time, this image of extreme poverty was very meaningful and impactful for us.

While walking through piles of trash and waste, we suddenly met a dancer from East Java. He happened to have won many international dancing competitions. Excited by our arrival, and proud to share his skill and culture, he gave us a  private and passionate performance. Looking at such a hard worker, full of the desire to perform well, we realized how poverty is not a matter of people but a matter of circumstances.

Finally our trip ended in the traditional market. There, drawn by colorful fruits, we started to taste the so-called "snake fruit" which revealed an unexpectedly tasty flavor, but our attention was rapidly diverted by a great gathering. Getting close to the place, we found an internet cafĂ© in the midst of the destroyed houses, full of young kids connected to Facebook or playing online games with other kids all over the world: a surprising but accurate picture of globalization!

This trip will remain a major landmark of our GMBA, the will, joy and courage of these slum dwellers reminding us of the burden of responsibility to be borne by future managers.

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