Through this emerging new paradigm of business education, managers develop “phronesis” as the virtue to know not only what is good for them but also for the others (and the society) and proceed in doing good in their daily activity
Contributor: Kostas Axaroglou
Outlet: Business Partners
The financial crisis in 2008 and the consequent Great Recession in the US was a moment of reckoning for the international business community: the world economy was in danger and its stability and sustainability was in jeopardy. It was indeed time for soul searching of the community both for business academics and business leaders alike. Business education at the time depends on an epistemological paradigm that understands the relationship between knowledge and the world through logical empiricism, the way people exercise knowledge in practice through rational choice and the way people in organizations relate to each other through Agency Theory.
Although still an ongoing discussion, the consensus appear to be that the perils for the system are internal : too much individualism at a manager (e.g. personal bonuses) and a company level (priority to shareholder value) and short-termism and result-driven decisions; and a business education model that trains business graduates as “linear thinkers who view the world through a purely economic perspective understanding one-way causation”; no surprise then why many claim that “the current troubles of the world economy . . . may stem in no small part from blind trust in an exclusively economic view of business and the world.”
The solution put forward involved the introduction of humanities as an integral part of business education. Students are invited to read great works of literature, history, philosophy and participate in various forms of art, and then to begin a process of critical reflection, that bear upon management practice, that includes experimenting and forming their own knowledge. This integration contributes in the evolution of the teaching paradigm of business education where Agency Theory is supplemented by theories of collective action in order to account for how people in firms and organizations relate to each other. Rational choice is being complemented with insights in practical reasoning as an account of how people exercise knowledge to design their worlds. Finally, logical empiricism, as an account of the relationship between knowledge and the world, is being balanced with notions of experience drawn from the arts.
Through this emerging new paradigm of business education, managers develop “phronesis” as the virtue to know not only what is good for them but also for the others (and the society) and proceed in doing good in their daily activity. Thus pursuing not only their own benefit but also the benefit of the society, managers achieve a “virtuous life”. Through their decisions, they streamline resources to society’s means with a balance between the individual and the common interest, bringing the economy in a sustainable growth trajectory for the benefit of all.
reference: Colby et al., 2011. “Rethinking Undergraduate Business Education: Liberal Learning for the Profession”, Carnegie Foundation for the Advancement of Teaching.
Colby et al., op. cit.