Management Education: How Are We Doing in Canada?

MR. MACDONALD:

The late Sydney Smith, when President of the University of Toronto, often parodied that aphorism of George Bernard Shaw, "Those who can, do; those who can't, teach", in the following manner: "Those who can, do; those who can't, teach; those who can't teach, administer; and those who can't administer, work for the government." Normally, such a reference would not only be inappropriate, but actually offensive, in introducing James M. Gillies, a distinguished academic administrator and Dean of the Faculty of Administrative Studies at York University, were it not that I have followed that path myself to its ultimate conclusion.

Even without such self-protection, I would be on completely solid ground because Jim Gillies is not only a skilful teacher and an imaginative administrator, but also a "doer" in public affairs. In fact, I can think of no academic person who has had such an impact on the community, nor built a faculty of distinction and international reputation, in such a short period. This is the more remarkable when we contemplate the pressures on universities today and the public expectations for their product.

At the very moment when Cardinal Newman was writing, in 1852, that a university prepares a man "to fill any post with credit, and to master any subject with facility", the great democratic, industrial and scientific revolutions were in the process of launching the age of the specialist. Although the Faculty of Administrative Studies at York is devoted to the training of the specialist--in this case the business or public administrator--it has recognized that management is not an island to itself, but is rather a delicate instrument for achieving a sensitive combination of our human, natural and technological resources. As with any other specialty, "management" must be nourished by academic inquiry and scientific speculation. As Lord Keynes once suggested: "I am sure that the power of vested interests is vastly exaggerated compared with the gradual encroachment of ideas."

To assist the gradual encroachment of ideas on the field of management, York University is fortunate indeed to have James Gillies as Dean. He is a native of this province and was educated in the local schools and at the University of Western Ontario. Like so many others, he migrated southward for graduate studies at Brown University and the University of Indiana. His academic reputation, as well as his deep interest in public and business affairs, was nourished by fourteen years on the staff of the University of California at Los Angeles, during the period 19511965.

I could not begin to chronicle his books and articles on economics, finance, and administration. Suffice it to say, he has published and flourished. I would imagine that his widest audience exists currently among the readers of The Telegram in Toronto, where his Monday column on business and economics is widely anticipated, generally provocative, and always written with disarming simplicity. Dean Gillies returned to Canada on a mission to develop a much-needed capacity for university training in management studies. It is significant that the Faculty of Administrative Studies at York is concerned with management skills not only in business, but also in government. Whether we are dealing with international corporate competition or the administration of large bureaucracies, management techniques are of increasing importance in this country. The story is told of a man with five daughters. He had a great fondness for all of them, but, unfortunately, they had failed to attract many suitors. When it was suggested by a kindly acquaintance, "Mr. Jones, you must regard your daughters as your most precious resources", he replied: "Yes, but my great problem is how to husband those resources." We have a problem of husbanding resources in Canada and management education will be increasingly relevant to that process.

To answer the question: "Management Education: How Are We Doing in Canada?", I am happy to introduce a man:

- who is also a Director of a number of companies;
- who has served as consultant to many organizations;
- who was a recent member of the federal task force on housing; and,
- who is currently serving as a member of the federal Export Advisory Council.

Gentlemen, may I present, Dr. James M. Gillies, Dean of the Faculty of Administrative Studies at York University.

DEAN GILLIES:

Mr. President, distinguished guests, friends, gentlemen: thank you very much for the most gracious introduction. It was very kind indeed.

It is a great honour and privilege for me to speak at the Empire Club on the topic "Education for Management--How are we Doing in Canada?" In case any of you are waiting with bated breath for the answer to this question (at least, the answer which I have to it), I want to state immediately that I think in management education in Canada at the present time, we are doing very well.

You may be surprised that I give this answer, because many people are saying, and saying it quite often, that we are not doing as well in management education in Canada as we ought to.

Those who make such statements usually do so on the basis of one or two things. They point to the statistics that productivity of the Canadian economy in general is about 20 percent below that of the United States and, in manufacturing, according to the Economic Council of Canada, about 35 per cent less than in our neighbour to the south.

Various explanations are advanced as to why this productivity gap exists. It has been suggested that it might be because our markets are smaller; or because our tariff policy protects inefficiencies; or because our economic policy is wrong; and so on. But more and more often it is being suggested that the reason productivity in Canada is lower than productivity in the United States is because management in Canada is not as effective as management in that country. Such statements are usually softened by the amendment that in individual cases Canadian managers are as effective as their counterparts in the United States or any other country, but it is argued there are simply not enough well-trained people in management positions in Canada. Consequently, because we have fewer managers in aggregate number, our total management situation is poorer than in the United States.

Interesting as this point is, the fact is there is no way to prove it. I do not know how you can demonstrate that productivity in Canada is less than productivity in the United States because of poor management. But it is true, we do not have as many trained managers in Canada as in certain other countries, particularly the United States.

One of the reasons for this is that the educational institutions in Canada have not been very responsive to business needs or interested in management education.

Statistics show that about one out of every four male undergraduates in university, or any type of institution of higher learning, in the United States is studying business of some sort. In Canada, as far as I can estimate, the comparable figure is about one out of every sixteen or seventeen. In addition, in the United States about 30 per cent of the population between the ages of 18 and 22 are in some type of institution of higher learning. In Canada, as a whole, the comparable figure is less than 20 percent.

Whether or not the American programmes are particularly good is a matter for debate. But the fact remains that a much higher proportion of the young male undergraduates in college today in the United States are exposed to business and management education than is the case in this country.

The same thing is true of graduate education. One can say, without fear of contradiction, that the greatest educational export of the United States has been education in management. The best schools of business in the world are still in the United States of America. In fact, that country has always had the leading programmes of education in management.

The first school of business in the United States was founded at the University of California, Berkeley, about 1895, and the top school, the Harvard Business School was started in 1908. In comparison, the first modern contemporary business school in Canada, at the University of Western Ontario, really began operating in a major way after World War II.

On the other hand, while we do not have a long record of experience such as the United States, we are doing better in management education in Canada than many other countries. For example, we are certainly doing more in this area than most countries of Europe.

To follow what is developing in management education, it is well to watch what the Ford Foundation is doing, because that Foundation seems to put its funds where it thinks certain things need to happen, or are happening.

In the forties, the Ford Foundation spent millions of dollars in improving management education in the United States. In the fifties, it began helping management in underdeveloped countries--a programme which they eventually stopped because it was not effective. Currently, the bulk of the money which the Ford Foundation is granting for management education is being given to European universities that are trying to begin programmes in administration. I think part of this thrust has come about because, or partly because, of Servan-Schreiber's recent book The American Challenge, which points out so clearly that better management is a must for European industries.

In England, the Foundation has sponsored the development of two graduate schools of business, one at the University of London and one at the University of Manchester, and both are doing very well.

Canada in both a qualitative and quantitative way is somewhere between the United States and Europe. We are not doing as much for education in management as is being done in the United States, but, on the other hand, we are doing more than is being done in any other country in the world.

To return to the productivity discussion, of course it is implicit that if you argue that productivity is associated with management education, then you must also accept its corollary that management education does prepare people for careers in management. This, I suppose, is a debatable proposition.

I am convinced that good managers are made as well as born. I would not argue that a man cannot become a good manager without formal training, but I would argue that a person who is exposed to formal education in management will perform more effectively in a management position and the marketplace supports this view.

Our students graduating with an M.B.A. degree probably receive the highest starting salaries of any graduates of the university, and they all have several jobs to choose from. So the market through pricing, for good or ill, indicates that employers believe professional management education is a good thing, and are willing to pay a premium to obtain employees who have it.

I realize there are many books attacking formal management education. The most recent--which I recommend to you if you have not already seen it--is Up the Organization by Gerald Townsend. It is a very amusing book which I am sure will not be read with joy at the Harvard Business School.

Regardless of this, however, it is evident that management education does have its place and, therefore, if we are to improve management in Canada--if we are to have more effective management in Canada--we must have more effective programmes of management education.

If you accept the proposition that professional management and professional education are important, what do we need to do in Canada to make them better? And, perhaps more significantly, why do I think that within ten years, with good fortune, it may well be that Canada will be the leading country in the world for education in management?

First, we are increasing the number of people that we educate for management in our universities. In general, Canadian Universities are becoming more interested in management education.

In 1970, probably twice as many M.B.A.'s will graduate as in 1965, although I hasten to point out that, even though we are graduating many more, the number of graduates from the Harvard Business School equals half the total number of graduates from all the Canadian Universities. But the fact remains, we are doing more.

I am pleased, for example, that Laval University, which is often thought of as one of the more traditional and conservative universities in Canada, now has an M.B.A. programme. Laval has graduated its first class, and the programme is a very good one indeed. The university has organized a Faculty of Administrative Studies, and that faculty is doing a great deal to educate young French Canadians in management.

We, at York, have developed an exchange programme with Laval, whereby some of our students study part of the time at Laval and some of their students study with us.

And so it is all across Canada. Universities are more interested in management education, and many are developing very fine programmes. To me, this is a very healthy indication of the interest in management education in this country.

However, quantity is not the only important factor. Where we have a really tremendous advantage in the development of programmes for education in management in Canada is that our programmes are new, and we have a chance therefore to make them flexible.

Warren Bennis, the social psychologist, has made many studies of change, and one of his more recent shows that the three hardest institutions in the world to change are the church, labour unions, and universities. Anyone with experience in any of these institutions knows that what he has found is correct. Once they get structured it is hard to change them.

In management education in Canada, because we are not structured, we still have the opportunity to innovate management education programmes.

Let me give you an illustration using The Harvard Business School, and I hasten to add that I use the Harvard Business School as an illustration not to be critical because I think it is the best business school in the world. As many of you may know, it is located in Cambridge, Massachusetts, across the river from the rest of Harvard University although when you are at the Business School, you say the rest of the university is across the river from the Harvard Business School. At any rate, the river runs between the two. The Business School has its own buildings, its own dormitories, its own classrooms and its own administration offices. It is a small university in and by itself.

Many of my friends, who have graduated from the Harvard Business School, say that the best thing about being there was that after class they could go back to their rooms, meet their friends, and discuss what was being taught. These informal sessions, they considered a most significant part of their educational experience. I am sure that what they remember and relate about their Harvard experiences are correct. But the real question is, whether in this day and age, in the 1970's, you can have business students isolated from the mainstream of the university as a whole.

We are in a period of change--a fact that has been noted more than once--and the current period of change is so great that you must identify it as, if not a major, at least a minor social revolution, rather than as social evolution.

The illustrations are innumerable. For example, the first trans-continental flight by a jet across the continent was only in the mid-1950's. My father, who died a few years ago at the age of 90, had never been on an airplane; but my son Davey, who is 10, has never been on any type of airplane except a jet; and, of course, he has never been on a train. In two generations the change in transportation is almost as great as in all the previous history of the world. Or consider the transistor which was invented after World War II. It will replace the vacuum tube almost completely in another few years. And one can go on and on with illustrations.

Change is so great that somehow or another we must bring an understanding of it and its implications for our society into our educational institutions--and particularly our business schools. I do not believe that the students at the Harvard Business School can really understand what is happening in society without being associated with the rest of the university community--talking to the young political scientists, the young sociologists, the young philosophers, to say nothing of the professional radicals. I think the time when you create a business school that is separate from the rest of the university is over.

Unfortunately, given their investment in plant and equipment, to say nothing of their long traditions, Harvard cannot do very much to react to the new situation. But, we in Canada can because we are still in the formative stages of our programmes.

I believe that traditional business schools, organized as business schools, may not be able to provide the most effective education in administration in the future.

I gave a seminar at a leading business school not too long ago. At the meeting I pointed out that I knew I was speaking in a very good business school, and that the things being done by the faculty were interesting, but, I added, unfortunately much of what is being done is irrelevant. Needless to say, this started some lively discussion.

The fact is that many of the organizational problems, and the great administrative problems that we have in the world today, are not associated with business. They are found in governments, universities, hospitals and educational institutions. During the past three decades, a great deal has been learned, primarily in business schools, about organization theory and how organizations operate. How unfortunate it would be if this knowledge were not used to the greatest extent possible. It must not be restricted to solving the problems of the business corporation alone. It must be utilized in working out the great organizational problems in all areas of the economy and in all types of institutions. A faculty organized around the concept of business simply may now neither be the most effective structure for the teaching of administration nor indeed of business itself.

Since it is now recognized that there may be a body of knowledge about administration that is applicable to all types of institutions, several universities have tried to develop integrated programmes in administration. But this is very difficult for an institution that is old and structured to do, since it cannot be done by simply adding a course or two. It has to involve a fundamental change in approach. Certainly a business school that has operated for 15, 20, 30 or 40 years in a certain particular manner finds it difficult to make such a marked departure from its previous philosophy and style.

At the present time on this continent, there are three universities, the University of California at Irvine, Cornell University, and York University which are trying to create broadly-based faculties of administrative studies.

We take the position at York, in our Faculty of Administrative Studies, that whether a student wants to have a career in the public or the private sector, for example, whether he wants to become treasurer of the Province of Ontario, or the treasurer of Simpson's, we can offer an appropriate programme for him in one Faculty. We believe that a man who wishes to have a career in the public service should know something about personnel management, operations research, organization theory, economics, and accounting, as should the man who wants to make a career in the private sector of our economy--and this he gets. So we have them working together. Our students take many of the same classes together; they work together; they study together; and they go on and graduate together, regardless of whether their career aspirations are in business or government. The only essential requirement is that they must be interested in administration.

York's Faculty of Administrative Studies is in its fifth year of operation and we now are among the largest in Canada. The reason we have been able to attract such a large number of students to our faculty is because it is unique. We teach our students that there is knowledge about administration which they should learn, regardless of what their final career goals may be.

The by-product of this type of programme may be very important. First, it may well improve administration within the public sector of our society, although I am not certain that this will happen. Consequently, in ten or fifteen years there will be many senior public servants, and senior businessmen, who will have gone to school together, taken many of the same courses together, and who, therefore, hopefully will be able to communicate together much better than they would otherwise be able to do.

We also have a programme, thanks to the help of the Province of Ontario Council for the Arts, for education in administration in the arts. We believe that people who operate operas, symphonies, and so on, can benefit from some education in administration--and so in combination with the Faculty of Fine Arts we have developed a programme directed at improving administration in the arts.

We think this general structure for education can be extended to hospitals, educational institutions, and all other types of organizations. And the Ford Foundation apparently believes that this is a meaningful approach since they have granted York half a million dollars for research by members of this Faculty.

There is a third reason, and a compelling reason why there are going to be great changes in our schools of business. The fact is that the students who are coming into the schools of business today are quite different from the students who came into them only five or six years ago. The reason for this is that we are now getting students for the first time who started college in 1964. Nineteen hundred and sixty-four, as some of you may recall, was the year of the great Berkeley riots which started the major changes in approach to education, which all of us have seen one way or another in the course of the last five or six years. Any young person who has gone to university since 1964 has had to be influenced by what has happened within the university since that time.

While it is true that most students beginning the study of business administration are more conservative than other students, there is no question that they are substantially less conservative than they were only four or five years ago; and I am not using "less or more conservative" in any sort of pejorative sense. They are simply different.

You cannot operate a school of business or a faculty of administrative studies today, as it was operated five years ago. The students are looking for different things. They are looking for more involvement, more concern about social problems by their faculty and in the courses which they are taking.

But the change is showing up most at graduation. As I mentioned earlier, most students have a choice of many jobs, and they are offered attractive salaries. But, student placement officers this year are finding their job totally different from what it used to be. This change may be for the better, in that the best students that we are graduating do not want to find employment through the placement office. If you are out for your firm recruiting good M.B.A.'s, you are probably not going to be able to find them if you recruit them through the ordinary placement office procedures. The very best students now are looking for the jobs themselves.

I think this is a healthy situation. Students are looking for the jobs themselves, not because they can't get a job, but rather they want employment that they think will be meaningful to them, that will fit what they like to call their life style. I am not quite sure what a life style is, but it has something to do with contributing to the betterment of society. I would believe that, of the hundred and fifty or so M.B.A.'s graduating from our programme this year, at least 25 of the top students tried to match the job they wanted with what they saw themselves doing in this society.

This to me is the demonstration that the student is different. He is not going to college, and he is not going to a professional school of business or professional faculty of administrative studies to get a degree to get a job. He is trying to learn something--he wants more than the cheque.

The men that graduate from our faculty believe--and we certainly try to instill this idea into them--that to be a first-rate manager or a first-rate administrator is to make as much contribution to the well-being of Canada as can be made by any profession. But, they want to be sure that they are doing their management and their administration in a place where it counts.

So I see in Canada a terrific opportunity for building great schools of business administration and great faculties of administrative studies. Our programmes are new so they can be flexible and they have been well-funded from a variety of sources. We have a chance to transfer to Canada, the leadership in business education which has so long been held by the programme in the United States.

I always use as a sort of benchmark when thinking about these types of opportunities the remarks of a very great architect--Daniel Burnham--who speaking about 65 years ago to a graduating class of architects at the University of Washington said something like this: "Make no little plans. They have no imagination to stir men's blood, and probably won't be realized anyway. Make big plans. Aim high in your hopes and dreams, remembering that our sons and grandsons are going to do things we never thought of. Let your watchword be order, your beacon duty."

Let us have no little plans for management education for Canada. Let us have big plans and work towards the goal of making Canada the leader for management education in the world.

Dean Gillies was thanked on behalf of The Empire Club by Mr. P. J. Ambrose.