Greed is here to stay - learn to work with it
By Charles Jacobs
Published: May 18 2009 03:00 | Last updated: May 18 2009 03:00
Blaming MBA programmes for encouraging the behaviour that has led to the current economic crisis is a popular pastime. But from the perspective of neuroscience, such criticism is misplaced, as are most of the attempts at reforming the programmes. It would be better to help students pursue their natural inclinations rather than vainly trying to thwart them.
We fault MBAs for their short-term focus, greed and unethical behaviour, but how could they be otherwise? An MBA education is not designed for those with an abiding love of scholarship in the field, nor for those focused on the betterment of mankind. Students enrol to enhance their ability to make money and we must expect them to behave in line with that goal.
In response to the public outrage, many schools have revamped their curriculums to emphasise "holistic thinking", "values" and "ethics".
But these efforts are unlikely to succeed because they run counter to the fundamental purpose of the programme. It is questionable that one can teach ethics or values, but it is even more doubtful that students with neither would be converted by a required course, particularly if it interfered with their ability to make money. Nor is it likely that those exclusively in pursuit of profit would willingly exchange it for the greater good.
If we want MBA students to change their thinking and behaviour, we have to make the case that longer-term thinking, a different set of values and ethical behaviour will help them to realise their goals.
It has been assumed that short-term thinking is a result of the pressure for quarterly results, but research in neuroscience suggests it is caused by the corporate preference for objective, unemotional decision making.
Experiments have demonstrated that effective decision making is driven not by reason, but by emotions. When we disregard our emotions, as we do in the corporate world, we cannot access what we have learnt from our past experience and our thinking becomes myopic and short term.
This could be demonstrated in the classroom and would make students less certain of their individual decisions and forecasts for the future. Being prompted to acknowledge what they don't know might lead to a more prudent management of risk and could encourage them to consider potential consequences of their actions or decisions.
Learning about the activity of mirror neurons would drive students to reconsider the value of ethical behaviour and its link to organisational performance and profit.
These specialised nerve cells mimic the mental state of those we come in contact with. We sense those who are greedy or who are interested in the common good and tend towards those that have our interests at heart.
Ethical leaders garner more support and get more done, so their organisations perform at a higher level and make more money.
Other research on the role of neurotransmitters would influence students to reconsider their values. The neurotransmitter dopamine, responsible for pleasurable feelings, is released not when we receive a monetary reward for our work, but when we are fully engaged in the work itself.
Studies have also found that once our basic needs are met, there is no correlation between the possession of wealth and happiness.
We will never eliminate greed from human nature, nor dissuade those that follow a course of study to make money from trying to make money. But we can make the case for behaviour that benefits the individual and society.
We can teach how to better anticipate the consequences of our actions, how ethical behaviour is more profitable and how balancing the drive for profit with a love of the work itself will lead to greater happiness.
Rather than trying to prevent people from doing what they're going to do anyway, we need to teach them how to achieve their goals by helping us achieve ours.
Charles S. Jacobs is the author of Management Rewired: Why Feedback Doesn't Work and Other Surprising Lessons from the Latest Brain Science, published by Portfolio
Copyright The Financial Times Limited 2009