Since the founding of the Western Business School in 1948, the School has benefited from the support of an Advisory Committee, consisting of influential members of Canada’s business community. Today, the Ivey Advisory Board (IAB), which comprises some 50 members, helps further the mission and aims of the School, and acts as a visible body of leadership, influence, and support with the external constituencies Ivey serves.
In April 2018, as part of the IAB’s annual spring meeting, we brought together board members and Ivey faculty for a freewheeling discussion on the subject of disruptions. The IAB participants included bankers, managers, investment counselors, entrepreneurs, CPAs, and consultants, among others.
Together, we considered three questions. In terms of disruptions, what are you in the business community seeing out there? What are you doing about it? And finally what should we at Ivey be doing to prepare future leaders for disruption?
Give AI a supporting role
The first answer we heard had to do with data, and its manipulation. Of course, numbers in business aren’t new. But as one participant pointed out, businesses today have far more data to work with—and they’re starting to figure out how to use that information more effectively. The trick is to figure out how to use algorithms, artificial intelligence, and machine learning in a supporting role, rather than a starring role.
“In our business,” explained one investment advisor, “the goal is to use technology to make better decisions—but not to make the decisions.”
The days of small sample sets are behind us, added an executive with experience in professional services and public accounting. Today’s accountants—deploying a resource like IBM’s Watson—can draw on data sets numbering into the hundreds of thousands to spotlight and resolve their clients’ potential compliance issues. So where a traditional accounting firm might once have hired nine recent accounting graduates, tomorrow’s firm will hire one accountant, one computer scientist, and one data scientist.
Communication is key
At the same time, as another participant observed, technology is also facilitating large-scale disintermediation across a wide range of industries. For example: Turning to online platforms, producers are increasingly taking their brands direct to consumers; as a result, the entire retail sector—as well as the magazine and newspaper industry, depending on ad revenues—is feeling the cold wind on its neck.
“How do you transform a legacy business model to a new business model,” asked one voice at the table, “and still maintain profitability, and some level of calm in your organization?”
One answer: better communications, both within the firm and between the firm and its customers.
One participant admitted that she and her MBA classmates hadn’t taken their sole communications course very seriously, two decades ago; today, she observed, students had better be taking more communications courses—and taking them seriously.
Recruitment and retention
Attention next focused on recruitment and retention in the age of disruption.
“Recruiting rapidly, in rapidly changing circumstances, is just tough,” said one participant. Several other participants also pointed to the challenge of dealing with people who are among the most talented within the legacy business. Most of them can read the writing on the wall, and many of them are eager to be retrained (and therefore retained). But can they be?
On that point, at least some participants were optimistic.
“The best digital marketers aren’t the ones just coming out of school,” as one person at the table phrased it. “They are the 50-year-old people who have embraced it—who know marketing, and have educated themselves on the technical application of it.”
Curiosity is a key attribute of the leader, most agreed. It’s the people who are constantly learning and improving themselves who are best equipped to manage effectively in the context of disruption.
People around them see that, and admire it, and are willing to follow their lead: “Leaders are the people whom others look up to.”
In a sense, disruption creates the ground on which new leaders can emerge—and those “new leaders” can in many cases be found in the leadership ranks of the legacy business.
“You’re not going to be able to recruit magical young 25-year-olds to run everything,” said one banker, “in part because they haven’t had time to master the fundamentals.”
Deal with deceleration
One challenge that’s rarely talked about in the context of disruption, but should be—according to several participants—is “deceleration.” What happens when you realize that your business model, and probably your legacy organization, is doomed?
“Deceleration is the other side of the coin,” said one participant, “and it usually involves a lot of collateral damage—organizationally, financially, and almost every other way.”
But can leaders prepare effectively for that role? Should they?
“Again,” said an executive who had lived through deceleration, “it’s hard to convince the good people to stay in the old world.”
Successful disruptors tend to be populated by two kinds of people, said our participants: brilliant technologists, and individuals with proven business acumen—and the successful individuals in both groups have drive. This combination tends to be effective at overcoming two classic entrepreneurial challenges: a great innovation for too small a market, or—conversely—too limited a vision for a great innovation.
Embrace diverse education
As for appropriate directions for business education, we heard again—as in previous discussions in this series—that joint degree programs have great appeal for both students and employers.
Being rooted in more than one field is one of the strongest foundations for career success, our participants generally agreed, with STEM/management combinations being an obvious choice. Somewhat surprisingly, though, several people around the table made a strong pitch for a non-STEM joint degree for managers, as well—for example, the humanities, geography, or history.
“If you believe that communication is important,” said one—harking back to a point made earlier in the conversation—“putting kids through an engineering program isn’t necessarily going to do the job.”
Closing thoughts
One Ivey grad at the table stated that the most valuable thing he had gotten out of his business education was the ability to prioritize and make decisions—even with limited information, and even with limited resources.
“It’s about focusing your people where they need to be focused,” he explained, “and that hasn’t changed. But in the context of disruption, you just have to do it better and faster. Way better, way faster.”
“Yes,” another participant agreed. “So do whatever you can do to help young people learn to adapt to the rapid pace of change, because it’s faster than anything we’ve ever seen before.”
But how, exactly? One participant wrapped up the conversation with an indirect answer to the question: “The thing I always say to our people is, ‘It’s not important that I know, but it’s important that I know that you know.’ In other words, the leader constantly probes, and makes sure that his or her people are getting where they need to go. And that’s what business education needs to instill in tomorrow’s leaders.”
