Akkam’s Razor

Business schools are bad for business? This is not going to go over well…

“In a nutshell, Ghoshal argued that business schools have, for the past 30+ years, been preoccupied by two things, to little good result.

First, they have a need to have their work considered in the same favourable light that �hard� science is, by replacing ethics with �a firm belief in causal determinism for explaining all aspects of corporate performance.� This is problematic, according to Ghoshal, because unlike in science, where the universe acts in much the same way no matter what you say about it, the object of the social sciences � people � will change based on what you think about them, either rising to the occasion or sinking as appropriate. He calls this misapplication of the scientific method �the pretense of knowledge.�

The second theme is that of ideology of liberalism (in the original economic, rather than subsequent social, sense), and no name pops up more in this context than Milton Friedman. Ghoshal posits that they�ve become focused on the negative aspects of business � i.e., risks � while ignoring the positive ways that businesses and people interact. He calls this �the negative problem� of an �ideology-based gloomy vision�, which has lead to phenomenon like the complete exclusion of social benefits from business planning, because it is �irrational� and considered an aberration in a free, open market.”

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