World After Covid-19

World After COVID-19: Erika James, The Wharton School of Business

Erika James is Dean of The Wharton School of the University of Pennsylvania. In conversation with Soumitra Dutta and Dan LeClair of GBSN, she discusses the importance of engagement and outreach when dealing with global crises, as well as the positive developments she has seen during the pandemic. The interview took place 12 weeks after COVID-19 was declared a pandemic by the World Health Organization. At the time, James was the John H. Harland Dean of Emory University’s Goizueta Business School. This is an edited transcript of their exchange. 

More interviews from The World After COVID-19 Series

Highlights from this interview:

  • Business schools will continue to explore how technology can enhance the learning experience.
  • The pandemic has exposed societal inequalities, but it has also brought forth an increased effort to support vulnerable populations.
  • Current global problems cannot be solved without a broad perspective.
  • The pandemic has given people the opportunity to step up in ways that their typical jobs might not allow.

Dan LeClair: Do you think what is happening right now is a turning point for the world, and if so, how?

Erika James: It is definitely a turning point for the world. This is a moment in time that will define a generation of young people, but also those in other age cohorts who have seen their life experiences turned upside down in a matter of weeks. Because this pandemic has led to such economic devastation for so many around the world, the effects will be with us for decades. It is hard to see how this could be anything other than a far-reaching, long-lasting turning point in what we have known as a normal way of being.

Soumitra Dutta: There are some who make the case that the COVID crisis is going to accelerate those forces that are already in play in the world, while others argue that there will be a dramatic shift away from our past tendencies. Which of these two camps do you think you are more in?

James: One force that has accelerated is the global shift toward nationalism. This pandemic has shown us what could happen if we continue toward the severe forms of nationalism that have been underway in many countries, and how impossible it will be to function as a global society without some pushback. We need to pivot in the other direction to say, yes, there are great points of pride that we need to take in our own countries, but at the same time, we are so far down the road on being an interconnected global society that we have to continue with that work.

Dutta: How do you think business leaders will change in the way they guide their companies, relate to government, or influence societal values and directions?

James: I think we have started to see a movement with some business leaders to recognize that they have a platform, and how they choose to use that platform—what they choose to communicate or convey—is growing increasingly important. I see many business leaders taking on a leadership role beyond simply their organizations. For example, I have been in touch with an organization called Conscious Capitalism. They are several CEOs of small, medium, and large businesses who are proactively—and fairly aggressively—trying to create a new narrative about the role of business and business leaders. This is a moment in time when we have the potential to see that movement and narrative get much more attention.

LeClair: How do you see the model for business schools changing? Do you think that the movement to online delivery could remain after COVID-19—and how do you think that could change the way people think about the price-value ratio for business education?

James: The business model is definitely going to change. We have seen business schools, colleges, and universities fundamentally transform how they deliver their primary product, which is what takes place in the classroom. Even those faculty who were most resistant to online education have had positive outcomes and learned from this experience. If nothing else, it has taught us how rapidly change can happen and how flexible and adaptable our systems can be. Do I think we will all stay in this mode of online learning indefinitely? Probably not.

There is real value to the face-to-face delivery model. But we are going to see much more focus on understanding ways that technology, digital platforms, and AI can enhance the learning experience. I think we will find more and more faculty who will be open to experimenting in ways that they might not have in the past.”

From the student perspective, this is a significant change. They have questioned whether or not online learning is as valuable as what they had experienced in a residential format. Truth be told, the fixed costs of delivering education have not changed. Our faculty are still our worldwide academic leaders, and that knowledge base still costs what it cost two months ago. Delivering that education, even if it is an online format, is not necessarily any less expensive than it was in the past. The value of the degree will still be worth as much thirty years from now as it is today. So, we have to recognize that regardless of the format, there is real value that comes in what schools are going to deliver. It may look different. It may feel different, but different does not mean that it has to be bad or worse. What we need is time to work through the kinks and understand what the new form of education will look like.

We are going to see much more technology utilized. Not every school and university is going to go completely online, but there will be hybrid approaches and new technologies as a result of what we are learning now. So, it is going to look different. It will be just as valuable—and has the potential to be more valuable, in fact—because we can now open ourselves up to more diverse populations around the world in ways that were more difficult to do in a strictly residential format.

LeClair: What about diversity right here at home? One of the things we are learning about COVID-19 is that it affects socio-economic groups differently, and that some populations which are already marginalized are suffering more than others.

James: COVID-19 has illuminated vulnerabilities and populations that many were less aware of and likely less sensitive to. I have been heartened by seeing communities reach out, support, help, advise, and provide resources in ways that they previously did not—or at least at a magnitude or scale that is different from what they had done in the past. I think it is all a matter of how we choose to experience and live this moment.

I have not seen many people retreat into themselves and avoid divergent opinions or ideas, which is typically the reaction to a crisis. I see people attempting to reach out more, engage more, and find solutions and sources of support in ways that were less likely in the past.”

Dutta: Some people argue that social distancing is actually just physical distancing while we are becoming closer socially to our families and others around us. How will social distancing affect us and society at large?

James: It depends on how long this goes on. I have seen positive outcomes as a result of social distancing with the people with whom I am relationally closest. As you pointed out, family members are finding ways to come together more than they have in the past. At the same time, if social distancing continues for many months or a year from now, I think it will start to affect how we integrate because it will become more normalized. Once it becomes normalized, then it requires a different kind of shift to get us back to how we engaged with people in a work setting and in social interactions outside of our immediate family. So, I think that there will be a tipping point. I do not know when that is, but there will be a tipping point that has the potential to adversely affect social dynamics longer term.

Dutta: If I asked you to look ahead, what would be your best-case and worst-case scenarios for the future?

James: If we can use this experience to learn that not everything can, nor should be, resolved in a political and partisan manner, which is what we have seen for so long, then we might achieve better, more integrated, and more far-reaching solutions. That would be a best-case scenario. I think the worst-case scenario would be if we become more entrenched in siloed thinking and in perspectives that do not allow us to consider new and different ideas.

We cannot solve today’s problems without a broad perspective of ideas and solutions, and that requires engagement and outreach to people, organizations, companies, and communities that we would not necessarily reach out to because we assume they do not understand or have knowledge of how to address today’s problems.”

The absence of reaching out is going to create more problems for us.

LeClair: You have had an already highly successful career as a dean at Emory’s Goizueta Business School, and you are moving now into arguably one of the most visible and powerful business schools in the world, Wharton. In light of what is happening right now and in light of your transition, how do you think you will change as a leader?

James: To your point, I am moving into an organization that is so visible, has a global reach through its alumni, and is seen as one of the world’s most influential academic institutions regardless of discipline. I cannot not be changed by that. I will be exposed to so many new ideas, people, perspectives, and scholarship that I will personally grow enormously from that experience.

The schools are very different, and the contexts within which they operate are also very different. At Emory—in the city of Atlanta, a highly visible and business-centric city—we have almost twenty Fortune 500 company headquarters. So, that influenced the choices that I made there. Going to Wharton—which sits in Philadelphia, a city that is very strong in healthcare and education—means that there are opportunities for me to grow and learn new industries in that context. And Wharton is so global that my own perspective will be enhanced pretty tremendously because of the access to Wharton alumni and leaders from all over the world.

My academic scholarship for the past twenty years has been in the area of crisis leadership. This is one of the first times as an academic leader where I am really being called upon to leverage that expertise, both practically and in so many other ways. It has been fascinating to be on this journey at this particular time.

Dutta: On that note, what advice would you have for other fellow deans as they try to navigate this crisis that will probably continue for some time?

James: What I have tried to recognize, and convey, is that I do not have all the answers. This challenge is so big that I have to rely on people’s experiences and expertise in ways that I never have before. I would encourage other deans to recognize that you will learn more about your faculty and staff in this moment in time than you have probably in the entire time that you’ve worked with them.

You will see people step up in ways that you could not have expected because they thrive under pressure and have an opportunity to demonstrate the creativity and innovation that their typical jobs might not allow.”

You will also see leaders in defined roles—people who are supposed to be the leaders—potentially not step up in ways that their position or title might convey, because these are moments when they would not necessarily thrive. We have to be mindful and learn new things about people in this way. Then, we can leverage skills and put people in the roles that they are suited for when we are experiencing this kind of crisis. Another thing I would say is to recognize that even though we have high expectations of people to perform in this moment, they are human and are also dealing with the challenges we hear about on the news. We have to be sensitive to those things they are managing that we might not see on a day-to-day basis.

This interview was conducted by Soumitra Dutta, Chair and Dan LeClair, CEO of GBSN. This edited summary was prepared by Mira Anderson, GBSN Programs Intern.

World After COVID-19: Franz Heukamp, IESE Business School

Franz Heukamp is Dean of IESE Business School at the University of Navarra. In conversation with Soumitra Dutta and Dan LeClair of GBSN, he discusses important global trends that the pandemic is accelerating, as well as the increased responsibility of business and business institutions to society. The interview took place 12 weeks after COVID-19 was declared a pandemic by the World Health Organization. This is an edited transcript of their exchange. 

More interviews from The World After COVID-19 Series

Highlights from this interview:

  • Democracies will become more polarized as a consequence of the pandemic.
  • The European Union may come out of the crisis stronger and more united.
  • Globalization continues to be a source of great economic benefit for society; therefore, countries will not completely abandon global supply chains.
  • An institutional shakeout is likely to occur, as fewer business schools will be able to offer successful programs to students.
  • The responsibility of business toward larger stakeholder communities will become more important.

Dan LeClair: Given what is happening right now, do you see this as a global turning point for the world and in what ways in general?

Franz Heukamp: I have been thinking and I am sure many people have been thinking about what this really means. This is clearly a worldwide crisis that we are going through, first healthcare related with the virus infecting people, and now there are millions of people that have applied for unemployment benefits in the US. The data is already out, so clearly this will also have a very deep economic impact. In that sense, because it is likely to be the most important economic crisis certainly of any of our lifetimes—it may not be as big as the Great Depression in the US in 1929, who knows?—all the active managers today who are running any kind of organization will face something bigger than they have ever done before. In that context, I think lots of things can happen and are likely to happen. 

My impression is they will probably accelerate some developments that were already on the horizon. That is going to be the main way in which change will manifest itself. I think that is true at the level of each society. We already had a discussion before, in many societies, about inequality. We had a discussion about the fundamental principles that hold a society together. I think that will get stronger, and we will be seeing some countries that will be pushed and destabilized quite a lot. Democracies that were already very polarized before are likely to become even more polarized. That will be one of the direct consequences. 

Also, if you look at the global economic situation, the twenty-first century so far has already been the century of Asia rising, and I think that will also be accelerated. It is quite clear that even though the entire world is going through this crisis in different stages over time, Asia has already emerged faster and has shown to be more resilient to these kinds of crises—maybe because there has been a history, of course at a much smaller scale, of some of those healthcare related diseases and how to manage them. I think that will also be accelerated, so you will see Asia rise faster than it was even before. 

At the level of the individual—habits, how we work, how we live—I think it is a little harder to tell. There, I am actually a little bit more skeptical about the predictions people are making that we will do everything online from now on. I am not that sure. I think once you have the choice between doing things like you did before and maybe using a little bit more telecommuting and online meetings, I think the effect will actually not be as strong as we would say today. I think they will be surprised.

Soumitra Dutta: I want to come back to the bigger picture that you raised and ask you to focus a little bit more on the European Union. What do you see about the state of global coordination and leadership in trying to address this global pandemic?

Heukamp: I think the COVID crisis hits the European Union in a very delicate moment. I think Brexit showed that the European Union is fragile and needs to find a good reason and good set of objectives to show that it is worth investing in for each country. So, I think here is actually an opportunity, and I see that the European leaders are working on it to make sure that there is such a thing as a coordinated response and that for any individual country, it really makes sense to be part of the European Union because it allows you to do things that you could not do on your own. Frankly speaking, the beginning of the management of the crisis at the European level has probably been slow and not as effective as desired. Remember that several European leaders apologized to the Italian head of government for the slow response, so the beginning certainly was not that great. But from what happened these past days—European heads of government getting together and trying to find a solution—I am actually optimistic that this can work out, that this will actually instill the European Union with energy, and that it will mean for all the European Union countries that it is a project worthwhile.

Dutta: So, you think Europe will come out of it stronger. You are optimistic on that side. In a world where the US and China dominate, you think Europe is going to be able to keep its position.

Heukamp: I think that the European Union as an entity and as a player will actually, yes, be strengthened in the end by this crisis because the individual countries will pull together and will invest in the European Union. That may not be enough overall to be a very relevant player compared to the US and China at the worldwide level, but as being a significant force in the lives of Europeans, I think the European Union will be strengthened.

LeClair: Sticking with Europe for the moment, I have always admired their leadership on data privacy. This current experience is creating some challenges in how that bowls out into the future, and I am wondering if you could comment about that.

Heukamp: I agree with you that there is, of course, a history, and there is a cultural context. That has meant that the European Union countries have always been quite cautious about what data under which circumstances can be shared with organizations and among organizations. Right now, of course, we are in a situation where there is a direct benefit that is quite visible from tracing how people have been infected and through that tracing making sure that the disease can be contained. There is an obvious benefit, but I can see from the different people who are taking part in this debate that they have not forgotten about general principles of privacy that are important. So, I think the solution that will be found to trace people who are infected and the corresponding data sharing will comply in the end with the understanding and philosophy of European data sharing. I actually believe that this will also be good, indeed, for the rest of the world inasmuch as it will set an example for the US.

Dutta: How do you see business evolving and changing its strategies, its view towards globalization, its focus on shareholder versus stakeholder, and its focus away from profits perhaps into more people issues?

Heukamp: That is a very broad set of questions. I think the general tendency that we have already observed in the past few years to put stakeholder capitalism in the center—the different stakeholders take a little bit of weight away from the shareholders towards people who work in organizations, their customers and clients, and society at large—will be reinforced and accelerated precisely because it will be a moment of economic crisis in many countries in the world and therefore there will be a sense that those who have more need to contribute more. There will be a sense that we are in this together as a society, we need to stand together, and everybody has to make sacrifices. Single mindedly insisting on an organization’s purpose being the maximization of the benefit of just a few, I think, will be even less acceptable going forward than it already was. In that sense, I think there will be an acceleration. 

In terms of supply change strategy and globalization, I do not believe that people will walk away from globalization because it is a great source of economic benefits for societies.”

Obviously, there will be more safeguards put into place in terms of planning at the level of the individual organization for what can happen. I think that every time you have a crisis, you reinforce the part of realization that was clearly too weak as it was in the crisis. So, people will be putting into play some extra safety measures in terms of making your supply chain less vulnerable to disruptions, but I do not think it will be abandoned completely because no one would benefit from that. Frankly speaking, other crises have also shown that people forget quite quickly, so I think we also have to assume that what will be seen as relevant today and a big problem in terms of supply chain, in fifteen or twenty years once the people who are managing today’s crisis are not in charge anymore, maybe will not have as much emphasis. But I think there will be some changes in terms of safety measures, how much you rely on global supply chains, and so forth.

LeClair: Let us shift to business education. There are obviously changes happening as we speak, and there is an interesting debate about to what extent those changes will be lasting in individual schools. There is also a debate about how it will change the industry. Could you talk with us about how you see both changing?

Heukamp: I think here, we will also see a little bit of acceleration of an existing tendency. Already, the world of business schools has been crowded. There are many players in the market. Also, if you think about executive education, there were non-academic players that were already in the market. I think what we will see through this crisis, first of all, is that because you cannot do presential programs right now, the main activities are severely disrupted for most academic institutions. Some of it is happening online, but certainly not all of it. So, I think what you can expect to see is that as a result of the crisis, some of the players in the short term will disappear simply because they will not be able to withstand the prolonged crisis and the lack of revenue that they will be going through. In that sense, there will certainly be some consolidation going on. 

Also, if you think about specific programs or formats, it will probably shake out a little bit of the industry. The MBA, for example, already was on a track of ending up with a set of maybe twenty or thirty schools who could successfully deliver a full-time MBA program, and that trend will probably also be accelerated.

I think the MBA will continue to exist, but only a relatively small number of twenty or thirty will really be able to offer successful experiences to students in that area.”

And if you look at other areas of business education changes, there has always been the question of how much should be taking place online versus presential. I think here, we will actually see quite a bit of advance in the sense that the online capabilities of schools will have improved a lot because many people who are relevant in business school environments like senior faculty members, for different reasons, never really got into this until these days now in the crisis. They have found out that it is actually interesting, and you can do lots of things. It is not about better or worse. You can do certain things very well online and others you can do better presential. So, their toolbox will be bigger afterwards. They will know how to do it, and I think that will therefore increase the supply and the offering of hybrid programs—partly online, partly presential. So, you will see an acceleration there too. I think different things in that sense—a little bit of a shakeout at the institutional level and some changes in programs accelerating to incorporate more online elements. 

Dutta: Can I ask you to talk a little bit about what might change in the content of what we teach? Will there be any change, in your view, about how we see our students graduating and what kind of values and beliefs they actually learn from the MBA program?

Heukamp: Contents and capabilities are sort of our two knots–two parts of what is happening in a business program. In terms of direct contents, like what the subject matters are or the broad subjects that will actually be represented, again my anticipation is the change will be smaller than we would think today because there is a perennial set of subjects. Of course, there is some change in it, but there are certain ones that you really need to be on top of as a manager. If you are an aspiring or already mature manager, you need to know it. So, I think there, the change actually may be smaller than we would anticipate today. 

I think what will be again accelerated is a tendency that we have seen before, namely that a manager, a person responsible for a part of an organization or entire organization, needs to realize his or her responsibility towards all the people that he or she is managing directly or somehow touching indirectly as stakeholders. I think there, more will be expected. So, in the sense of values that you mentioned, I think we will actually see more of an emphasis on this—that managing is not just a technical set of disciplines with an interest in a very full toolbox. You need to know all of that, of course. You need to be able to do a solid financial, economic, operational, and so forth analysis, but there is a leadership aspect.

“Leadership is always about understanding how you lead people and how you impact people, and that has a strong value base. Specifically, I think the notion of service, being useful, and wanting to serve communities of the people you work with and larger stakeholder communities will actually be more important, and you will see that reflected in good programs.”

LeClair: That is a good segue into our final question. Moving forward, what are the top two or three leadership lessons? As a leader of a top business school in the world, how do you anticipate changing as a leader yourself?

Heukamp: I am in my fourth year here as the dean, and we have had a couple of smaller crises that we went through at the level of the organization, some coming from the outside but nothing of the scale of what we are going through right now because it is a worldwide crisis that is affecting everybody. That puts the entire business education industry in a very delicate spot because, with the way we operate, we need people to be able to move freely and travel. I think what is going to happen for me personally out of this is a stronger emphasis on really spelling out  the big picture vision of the institution—as in, “Why does this institution really need to exist, and what is important about it?” If I look back a little bit, in my first few years for good or bad, I think I took somewhat for granted that the people would understand why this was taking place. Maybe it was also a leadership deficit. You could say that I should have emphasized it more, but what I see clearly going forward is that, precisely in a moment or in a tough spot when it is unclear how we will be operating half a year from now because we do not know whether people will be able to travel and so forth, it is fundamentally important to send the message that it is important for the world and for society that we operate, and that this institution exists because it represents a certain set of values. It is a voice, and if it were not heard anymore, it would really be a problem. In that sense, in my own work going forward I will be focusing much more on the broader question of instilling people with the sense of mission and an understanding of why this institution needs to exist.

This interview was conducted by Soumitra Dutta, Chair and Dan LeClair, CEO of GBSN. This edited summary was prepared by Mira Anderson, GBSN Programs Intern.

World After COVID-19: Enase Okonedo, Lagos Business School

Africa in the World After COVID-19

Dr. Enase Okonedo is the Dean of Lagos Business School (LBS), Nigeria. In conversation with Soumitra Dutta and Dan LeClair of GBSN, Enase Okonedo discusses the changing equation of businesses and governments with respect to society across the globe, and particularly in Africa. 

This interview was conducted 11 weeks after COVID-19 was declared a pandemic by the World Health Organization.

More interviews from The World After COVID-19 Series

Highlights from this Interview:

  • There has been a retreat from Globalization towards domestication in the long run.
  • B-school curricula should emphasize the importance of managing risk.
  • The pandemic is likely to give African governments greater impetus to support intra-continental trade.
  • Social distancing can only be observed by the privileged in society.
  • There are no quick fixes to formalize Nigeria’s large informal sector. 

Dan LeClair: The COVID-19 virus outbreak has created an impact in just about every part of our lives from work to home, from government to business, and education. Do you see this health and economic crisis as a global turning point?

Enase Okonedo: I very much do and we are starting to see that play out in various forms. We were all moving towards globalization and seeing things as a global village with easy transfer of goods and people. We envisaged that this trend would continue, although in recent years we have seen a few nations embraced and move towards a more nationalist and populist leaning.

Now nations are starting to rethink things like trade policy, foreign policy, as well as what happens in their domestic economies. From my perspective, there is a retreat from what has become the norm in recent years towards more domestication of a number of things. So, I envisage a shift, possibly in the short-term but certainly in the long-term, from globalization to keeping things within borders because of the impact of COVID-19 on economies and disruptions in the supply chain. 

Soumitra Dutta: So, there is an increased focus within the national boundaries as opposed to a more global one. How will businesses change as a result of this? Will businesses have to rethink their supply chains? 

Okonedo: That is what I think is going to happen. It is not only companies rethinking supply chains, but also nations rethinking trade policy. It is not easy for organizations to immediately bring everything within the domestic boundaries because they have to ensure continuity of business in the short term during the pandemic. We have seen factories stop production on account of the disruption in supply chains and that has an effect not only on the business of the companies, but also on employees and the community. Companies are going to have a deep rethink about their dependence on things coming from offshore.

“This shift will affect many people, but perhaps the dependence on the global supply chain has caused more businesses and communities to be impacted by the pandemic than would have happened if it was more domesticated.

Dutta: Business schools are very geared towards a global point of view–that has been the mantra for so many years. What type of message should we be sending our students about this pause in globalization? Or should we push them towards continuing globalization? What should we tell our students?

Okonedo:The most important thing is to put more emphasis on the management of risk. Regardless of the strategy that is adopted, we musto become more cognizant of the risk that we face and the effects of such, in order to think about what mitigating factors to put in place. I am not so sure that I would walk into a class and say to my students, “try to hold back or delay or push [globalization].” My role will be more to get them to understand the risks. The risk preference of organizations varies, but it is important to recognize that something we used to take for granted as working seamlessly may no longer work as normal or usual.

“Therefore, I am hoping to teach students the ability to recognize the risks, to be agile and nimble, and to put in place the mitigating factors.”

Dutta: I like the way that you framed this in terms of risk as opposed to just globalization and deglobalization. Do you think that we are teaching about risk and risk management sufficiently to the MBA students? If not, what can we do to change it?

Okonedo: Because we operate in Lagos, Nigeria, this is something that we have always given a lot of emphasis to. How you manage risk in an uncertain environment, the whole fear about the working environment, is different if you are teaching students in a western business school. Certainly in my context we do a pretty good job of making the students cognizant of the risks. Perhaps risk has not been given as much emphasis in western schools. Still, there will be different types of risks and I think more emphasis should be given to risks other than the financial risks of businesses.

Dutta: This is a good case in point where perhaps schools in the west can learn from schools in emerging markets, and we can convey the sense of risk more effectively to our students. How do people assess risks globally without traveling or having a global mindset? For example, to assess the risk of having a part of the supply chain be in China, you should actually go to China. If you do not understand what is happening there, how do you assess it?

Okonedo: Thinking about businesses in my part of the world, I am not so sure that travel makes you more cognizant of the risks. I think it is more a consideration of other factors, like trade policy, protection measures, and supply chains. I think it is more about considering these factors than actually going to the place.

So, I am not so sure that restrictions on travel makes you less cognizant of the risks. I think it is a broader awareness of what those risks are that matters. 

“Without a broader understanding of the ecosystem in which the businesses operate and thrive, the travel will do you no good.”

LeClair: With respect to globalization, what are your views on the future as it relates to African integration? There is a set of people that believe regional integration will accelerate as a consequence of COVID-19. 

Okonedo: Yes, I share that view. Over the past few decades, we have promoted more inter-regional trade amongst the countries. Usually you will find in African nations that there is more trade with countries outside the continent than inside the continent. Intra-regional trade never exceeded 12%. That led to a bid to promote more trade within the region and to the creation of the African Continental Free Trade Agreement, which is expected to generate the largest trading block on the continent. There are various elements of this agreement that are expected to be put in place in order to better promote trade within the region. Some countries, like Nigeria, stalled in terms of getting on board, but eventually signed that agreement as well.   

Even with the broader agreement in place, however, the necessary laws have to be put in place within each country in order to promote trade there. And one will find that there are varying levels of commitment across the continent in that regard. I believe that the pandemic will provide a greater impetus to national government to get the agreement off the ground and make it the largest trading block on the continent—we can do more within the region and will be less dependent on the outside world. This is not making the case to be only inward looking, but I do believe that this will provide the impetus for national governments to do what is needed in order to get the agreement off of the ground.

LeClair: With the large part of the Nigerian economy being informal, do you see greater opportunity or motivation to convert more of the economy into the formal sector?

Okonedo: I wish I could say yes. Unfortunately, my answer will be no at this point in time. When we consider at the population of Africa, we must look at the percentage that operates in the informal sector. In Nigeria, for instance, the informal sector contributes about 60-65% of the economy and this is true in most places in Africa.

Why has more activity not been brought into the formal sector? What are the constraints that have caused it to remain the way it is? What is being done about those constraints? In some instances, there are environmental constraints and in other instances, there are institutional barriers which prevent people from being brought into the formal sector. It could also be due to the paucity of robust databases that enable us to identify individuals that operate in the informal sector in the first instance. If I look at all the factors that have to be dealt with in order to formalize the system, I do not think it can be achieved in the short term.

Will we start thinking about that? The people in the informal sector are largely poor. These people largely live in urban slums, which have impacted more by the pandemic. The crisis has brought to the fore the question of “what are we going to do about the informal sector?” This conversation is playing out across South Africa, Nigeria, Kenya, etc. Is there going to be a quick fix? No, and it is because there are too many constraints to deal with in the short term.

Dutta: We have heard a lot about how governments are taking more active steps to monitor citizens, to control what they are doing and with whom they are interacting. Do you see this trend also taking place in Africa? If so, what are the implications of such governance for society and for government in Africa?

Okonedo: At present, this is not taking place in many countries in Africa because of a number of reasons we just spoke about. The low proportion of people that are in the formal sector is one of the biggest constraints towards managing people, knowing who the people are and where they are. This is about supporting their identity and identity management, as well as having accurate data in order to plan better. In Nigeria, for example, I can speak a lot about the approach the government took. But the government also needs to provide palliatives to the poor and the vulnerable, and that has not been done. This is on account of the fact that there is no record of who those people are and where they are. That is a special difficulty in the African environment. 

When I look at governments’ reaction and their approach to containing this pandemic, there have been various essential measures targeted towards protecting the rich or the ones that fall into certain income categories, and the rest are being neglected.

“If the social contract between the citizens and the government has been broken, where it existed at all, there is a problem.”

Dutta: Do you see the government shifting priorities to focus more on citizen well-being and health? 

Okonedo: Yes, I certainly see that happening. I think the gross inadequacy of the healthcare sector was actually brought to the fore by what has been happening. There are various benchmarks that the United Nations suggests, in terms of the total spending on various subjects. We have consistently fallen far short of the recommendations in Nigeria. Here there are constraints on the ability to get the required equipment and so forth. African leaders who would typically go abroad in pursuit of medical treatment are not able to do that because of border closures. So, I think that the problem hits home a bit more. Certainly, there can be adjustments of budgets to spend more on the health sector. It is one thing to put these structures into effect, but the neglect has been astronomical in terms of inadequacy of primary health care facilities. 

Even more, I think this will lead us to think about education policy and what we are preparing people for. If we look at the ratios of medical personnel to the population, it is grossly inadequate. Yes, I do think there will be more focus on these topics now.

Dutta: To follow up with that, do you think the same is true for business leaders? Businesses generally prioritize economic growth and shareholder success, and less perhaps employee well-being, happiness, and health. What do you think will happen on the business level?

Okonedo: You are absolutely right—the focus of business has been on economic growth and maximizing shareholder values. The first thing that I find heartwarming is that across many countries in Africa, we have seen businesses step up and look at the ways in which they can support the government’s initiatives. Usually, you would find governments making changes with any grants that they can get from development agencies. But, in South Africa, for instance, people in the business sector created a solidarity fund. The last time that I looked, they had raised about 100 million dollars to support the government’s efforts.

Likewise, in Nigeria, there is a private sector coalition that has been contributing to this fight. The last time I checked, they had raised about 60 million dollars. So, businesses are now starting to understand the peculiarities and needs of the time, and they realize that the government may not have the ability to address everything. 

In terms of employee value and concern for employee well-being, I think this is also starting to happen. We can discuss how this is going to change employee policy, including achieving work-life balance and working from home. A lot of businesses have been able to carry on working with employees not coming to the office every day. I think we have grossly underestimated the effect of this pandemic on employee health and well-being. 

In the city where I live, Lagos, employees can typically spend four-five hours getting to and from work every day, and then have to go home with a very low level of sleep. What does this translate to? Stress related incidents, death, and absenteeism. Now, people are finding that they are more efficient and more productive because there is less travel time and they are able to devote more hours. I do think that this situation is going to change governments as well as businesses. Businesses will be a bit more focused on partnering with government to provide social services that are needed, and also for employee well-being.

I am hoping that businesses will be able to follow and contribute to this. 

“Another thing that I hope will come out of COVID-19 is more social innovation. We will look to innovate in a way that is beneficial to the social fabric of society.”

LeClair: Overnight, we have moved from face-to-face programs to being online overnight. Do you think this is a permanent change? Have we learned enough from this transition to believe that online education will be the new normal even beyond COVID-19?

Okonedo: I am not sure and will speak carefully about this. Let us consider why people come to a business school. They come for the knowledge, experience, and networking. Business knowledge cuts across a number of fields and attitudes, and perhaps values, and are an intrinsic part of business schools. But students are also interested in the experience of being on campus—the interactions as well as the networking. The shift to online learning enables us to take care of the knowledge bit. However, while there is a degree of interaction that can take place online, it does not completely replace the face to face interaction.

When Lagos Business School decided to move everything online, we were very prepared. I saw the shift to online education in Italy earlier and upon return to Nigeria, we started making plans for the transition. Nonetheless, the executive programs outright refused this change. Their argument was that online learning cannot replicate the in-person experience. I think that there is still some value in face to face learning, which some people look forward to. I do not think that making a 100% online offering will work for everything. It would work for some, but not for others. This is one lesson.

Another effect on business education, and what I fear the most, is the financial impact. Some programs are happy being online and some, like the executive programs, are not. If a top global school offers the first-year MBA classes online, and we are offering ours online, then most schools in Nigeria will do that too. That is going to have an impact on my finances. Even if I move to a blended format, then there will still be the question of paying a premium if everything is online. There will be clients who will aspire for face-to-face interaction but I think that percentage will be reduced.

Dutta: What do you think has to change in what we teach our students?

Okonedo: The ‘what’ is going to change certainly. At the start of this conversation we spoke about the emphasis on managing risk, as well as globalization. The ‘how’ is also going to change. Technology is going to quickly come on board to replicate some experiences, such as teaching and networking. For instance, last year at the Imperial Business School, they started using holograms to teach classes. So, it is not only the ‘what,’ but also the ‘how.’ With AI [artificial intelligence], experiential learning can be offered without bringing people together to go on a fieldtrip. Sure, it is not the same, but it is close.

LeClair: As you described, the structure of the management education industry may change as a consequence. What do you think about the broader ecosystem? To run a business school, schools have entrance exams, career fairs, internships, and other components that constitute a complete business education. How do you see that ecosystem potentially changing? 

Okonedo: You must be aware that this has already started to change. For instance, the GMAT test has begun to be taken from homes. In Nigeria and many parts of Africa, in which there was a notion of test centers, this is a welcome development and may translate to a permanent change if we can get it off the ground. With career fairs I know that organizations have been organizing virtual ones. The one that I have not figured out how it will change is internships, and whether or not it will. But now, when we say we are able to work more now efficiently from our own homes, then with internships it may also be the same. Some of the changes will be permanent, like with career fairs, and perhaps to a large degree the entrance exams, and so the ecosystem will change.

LeClair: There are business schools that are part of universities and some are standalone business schools. Do you think that this experience will create advantages and disadvantages to either type of business school?

Okonedo: I think that there could be an advantage to standalone schools. I had always felt that standalone schools were often disadvantaged, especially in the recent years. This was due to lack of an ability to carry out tasks on a cross disciplinary basis. Now that almost every school in the world is operating virtually, it opens a broader vista for standalone schools because of the opportunity to reach out to schools outside or within the university in order to do research, and to collaborate on projects and programs. I believe that the suddenness by which this has happened creates more of an opportunity for the standalone business schools. I do not see a disadvantage for the schools that operate within a university, but I do see an advantage for the standalone ones. 

Dutta: Given the stay at home policy, do you see society coming together or becoming more separate as a result of this forced isolation, in Africa?

Okonedo: In Nigeria, it is driving us apart.

“The differences between the rich and the poor have been exacerbated, and it has become a question of ‘us against them.’”

Under lockdown we are told to stay at home and practice social distancing. But, this can be observed only by the privileged, if I may use that word. Only people in a certain income group are able to do this. The larger population cannot practice social distancing due to poverty and because of residing in slums. Because of the large population that belongs to the informal economy, there are many people who have to go out each day to earn a living. If they do not go out every day, they are unable to earn their pay. And yet, we have instituted the lockdown. And these people do not have the means to sustain that lockdown.

Therefore, in my country and in some others, COVID-19 has caused social unrest because it is a question of the ‘haves’ versus the ‘have nots.’ Rather than bringing us together to say, “how can we fight this jointly,” they are saying that this policy only favors one category and not another. I see that playing out in countries in which there is a wide divide between the rich and the poor. So no, I do not see that this policy is bringing people closer together. In some smaller countries where the poverty levels are not high, there may be a greater degree of unity. But certainly not in Nigeria, or South Africa, for example.

LeClair: What are the few aspects of being a leader that will change for you or you would do differently?

Okonedo: For me,I have to focus on what is important, and this event has made me reflect on what my priorities are and what I spend time on. In the 10 years that I have been Dean, this is perhaps the longest time I have been spending with my daughter. We are doing things together, and therefore I am actually thinking if I want to go back to the way life was before or is there something more fulfilling in having more family time, where I am able to work but not at a frenetic pace. Certainly that is an aspect that will change going forward–the importance of family and making the time. It can be done. Sometimes we exaggerate our professional lives and the need to be in places and do things. But, we can do the same without compromising. For me, that is the most important lesson.

Another one is, when it comes to what we can do to influence society to bring about change, we were suddenly limited to relying on those around us. Now, one has become part of thinking at a higher level “can I get together with people to bring about that which will affect the vast majority of people,”rather than about philanthropy around my immediate environment. In this coalition that has come together with businesses, individuals are not waiting for the government. Instead of saying “it is not my business,” they are deciding what they can cause to happen. For me, these are the most important lessons that have come out of this event.

This interview was conducted by Soumitra Dutta, Chair and Dan LeClair, CEO of GBSN. This edited summary of the interview was prepared by Shefali Rai, Research Associate, GBSN, and Stephanie Eskine, International Communications and Event Planning Intern.

World After COVID-19: Peter Tufano, Saïd Business School

It’s About Winning the War and Winning the Peace

Peter Tufano is Peter Moores Dean and Professor of Finance at Saïd Business School at the University of Oxford. In conversation with Soumitra Dutta and Dan LeClair of GBSN, he discusses how lessons from World War II can aid government, business, and the education sector to win the war against COVID-19, and win the peace in a post-COVID world. The interview took place 10 weeks after COVID-19 was declared a pandemic by the World Health Organization. This is an edited transcript of their exchange. 

More interviews from The World After COVID-19 Series

Highlights from this interview:
  • While not assured based on previous experience, there is a strong chance COVID-19 will lead to meaningful change.
  • Recent business commitments to stakeholder capitalism will be tested by the economic crisis associated with COVID-19.
  • Although growth in online education is accelerating, the future blends it with face-to-face education because there is value in the experience that goes beyond knowledge transmission.
  • Interconnectedness highlighted by the crisis, demonstrates the need for a systems approach to curricula.
  • To win the peace as we did in WWII, we must focus on generating global prosperity and not only household and national prosperity.
  • Business schools must join forces to address the most importance problems of society, yet we are still working separately in the current crisis.

Dan LeClair: The question we’d like to start with is a very broad one. Do you see this, what’s happening right now with COVID-19, as a turning point?

Peter Tufano: Everybody always thinks that the world is going to change dramatically. If you think back to 1999 and 2000, the digital revolution was going to change the world dramatically. It didn’t–at first. But then it did. And then there was the financial crisis. The world was going to change dramatically. And then it simply didn’t.

This period is probably, at least in my professional lifetime, the most profound in terms of its potential for fostering change. If any world event will change business and society in a material way, I think this pandemic cum economic crisis cum political crisis has the chance to do that. The probabilities are higher that Covid will lead to meaningful change than any other systemic issue that we faced. Not higher than any systemic issue we may face, including climate change.  However, this crisis has come on with such rapidity that perhaps it will give rise to a change in collective consciousness that will lead to lasting change.

Soumitra Dutta: What changes do you foresee the various dimensions of government, business and society?

Tufano: Let’s start with business, because that’s what business educators study. Several months ago in the US, a number of companies signed the Business Roundtable statement. A few months later the Davos Manifesto was penned. In both cases, business leaders professed undying support for stakeholder capitalism and purpose. At an event in January, I simply presciently asked the question, “What happens when markets turn down and things get bad. How committed will we be to purpose?

Are we going to see a retrenchment to business as normal, or will we see something that’s dramatically different and a real commitment to stakeholders broadly?  We are seeing this in large and small ways, how firms treat workers, how they preference dividend payments over other uses of corporate cash.  I hope that this pandemic and the associated economic crisis will lead us to really commit to serving all stakeholders including customers, employees, suppliers, and the environment and communities.

An interesting bellwether is the dividend question. Right now, US corporate dividends are about half a trillion dollars a year and there is a lot of hand wringing about whether companies should cut their dividends. In a stakeholder capitalism world, I think you would ask the question, who amongst our stakeholders needs these resources most? Should we invest in our employees? Should we invest in our customers? Should we continue to hold fast to paying our shareholders the same amount of money we’ve always paid them? I think it’s going be an interesting case study or test. So on the business side I think we’re going to find out whether or not this commitment to stakeholder capitalism is real.

On the government side, I think this crisis is demonstrating the cracks in international systems. Multi-lateralism is being strained dramatically. I’d like to say that we will come out of this in much the same way that we came out of World War II. There will be new bonds formed. But if we compare World War I and World War II, the peace in World War I was not a successful peace in that it laid the groundwork for discontent and another war. The peace of World War II was a more successful peace, creating important albeit imperfect organizations, like the UN, to collaborate on global agendas.

“I’m hoping that we focus on winning the peace here, which is not only about finding national and household prosperity, but also global prosperity—a fairer and more just world, which protects the rights of future generations.”

My fear is that we will emerge with a World War I outcome, where we ignore the global prosperity and worry about the national, and we exacerbate our differences.  That will be our choice.

In terms of society. I think that’s interesting, too. If the populace sees governments and businesses as truly caring for their citizens and customers and employees, people’s trust in business and government will go up. If they see that they’re being abandoned, it will go down. I don’t know which way it will go, but it’s hard to think we will be let out of our lockdowns and everything will just seem normal again.

Dutta: After World War II, there was clear global leadership, and global mechanisms to coordinate. Today. that seems missing both globally and also the European level. I’m curious to know how you see globalization going forward.

Tufano: I guess it depends in part on your time frame. in the next 12 months, do I see a strengthening of multilateral organizations? No. Over the next two or three election cycles, might that be possible when different leaders take control in different countries. I think there is the possibility—and that is our best hope for a better future. The problem is, what should have been the big impetus for collaboration, which is to see a successful collaborative attack against Covid-19 being led across multiple countries, has largely been a lost cause, with nations competing and acting unilaterally.

Dutta: What about the rise of Asia? It’s been happening for some time. Do you think China’s role and Asia’s role will be accelerated on the global stage, and what implications will that have for the way we see the world evolving?

Tufano: I think we’ve already seen it happen. We will continue to see it happen. And I don’t think that trend is going to materially change. It’s partially a function of economics and partially a function of purchasing power, as well as soft power. Of course, China and Asia’s role has become more important. Important in what? Important in global trade, absolutely. And supply chains, yes. Will there be attempts to lessen the dependence, for example in the US, on those supply chains? I think so under the current administration.

How will that play out? That is an interesting question. There was a time when it looked like, when TPP was still a possibility, a multilateral approach was realistic, not just about trade but also around environmental issues, social issues, and more. I’m not seeing that in the cards for the short term; but perhaps over the long term.

LeClair: We touched on business and on society. How about higher education and business education, how do you see it changing?

Tufano: All the pundits are saying, we’re all online now and therefore, we are never going to go back to face-to-face. I don’t think that’s true at all. At least my students, and I think most students, are acknowledging that the experience that they have is far more than the transmission of knowledge.

There was a paper, I don’t know if it’s a good paper, reported in the Times of London today. At least in terms of micro measures, like performance on exams, the authors didn’t see any difference between students who studied in person and online. But, I think that education is far more than that. Are we all much more comfortable with online? Sure. Will we be much more comfortable with blended approaches? Yes.

On the positive side, I hope this reminds people about the value of expertise. The new vaccines being developed at the Jenner Lab at Oxford and rapidly-deployable ventilators of Oxvent are not coming out of random people anywhere in the world. They are the product of decades of science. I’d like to think that there will also be a recognition that there are insights to be gained from scientific work that we do in business schools. I hope we arrest, to some degree, the kind of anti-education approach that some have taken.

Maybe I can digress and use the wartime analogy again for a moment. In the middle of World War II, at least temporarily, four or five things happened. One, business schools became more purposeful. Two, they used that period to change the students they admitted, the way they taught, and what they taught. They tolerated, for a short period of time, different leadership styles. And basically, by adopting a whatever-it-takes approach, they liberated themselves from certain types of tradition. If, like in that 70-year ago period, this gives rise to a burst of innovation in education, not only pedagogy and what is online versus in person, but also in content, I think that would be a really healthy outcome.

We’ve been focusing on systems for the last eight years at the school. We have to understand how systems work, how they are interconnected, how to strategically intervene in specific points, and more. We’ve been saying that is a big deal at Oxford for a long, long time, and putting it in our core curriculum. If anything proves that this approach is important, it is what we’re going through right now. A pandemic is not just a pandemic. It’s not just a health problem. It’s also an economic problem, and a humanitarian problem and a political issue and a social problem.

“I hope this crisis will encourage others, not just the business school but also other parts of academia, to realize that everything we study tends to be interconnected, especially under stress.”

I’m an eternal optimist and I think that it will lead to, at least with our best selves, greater innovation in content and pedagogy. And, if that is combined with a greater appreciation for the power of science and evidence, that would be great.

Dutta: For business leaders and for business school deans like yourself, what do you think are two or three question they should be asking themselves at this point as a look at the future?

Tufano: Let’s not get to the future yet. There are three things we have to do. The first is health and safety. We all had health and safety reports that we ignored, because it was the last thing that we worried about. Health and safety has become paramount.  This was first manifested in how we went to working from home and teaching online.  A far more complicated health and safety issue is how and when we return to physical campuses. Secondly, how do you do our jobs as educators effectively in a context where a lot of our teaching is online. And third, and what’s most important, what’s your purpose and how are you making sure that you are moving forward on your mission? For me, and I hope for others, beyond the emergency, we should be asking, why are we here, and what gives us the license to operate in society?  And therefore, rather than being driven by external metrics like rankings and other traditional measures, what do we really have to do to justify our place in society? And if we all ask that question, then I think we might come up with some very interesting answers. In fairness, that question is really hard to ask in the middle of an emergency when you are dealing with day-to-day issues that are boiling over. But it has to be asked.

Today we had a school board meeting. That’s our governance mechanism. And I started it around mission and innovation because I knew that most of the meeting would deal with issues around the current shuttering of executive education, major questions around what would happen to the class next year, applications, yield, etc. All those urgent topics will drown out subtle issues around mission and innovation. So I started with a discussion of mission and innovation. I’m hoping that when we all get a chance to take a breath, that will be the thing that people who run educational institutions will be focusing on. Because this crisis will give us the license to do some things differently if we want to stay relevant.

Dutta: Do you see society coming together more as a result of this forced isolation at home, or do you see society going apart?

Tufano: There was data released over the last five to eight years that showed that global inequality was reducing, but the within country inequality was increasing. In the same way, we need to differentiate between local and global connections. My initial hunch was that what we’re seeing in a localized way is more “fellow feeling” than before. That’s an expression used by Adam Smith and also by our Queen.  However, as I look at the gaps opening up in the US as the country thinks about opening up, I am less hopeful. And even if we have greater appreciation for our close neighbors, I’m not sure that’s translating into global fellow feeling, which is about coming together globally. So we are reaching out to a lot more people that we haven’t talked to in a long time, and those local thin bonds of social capital may be getting a little bit thicker. That’s a good thing, but it’s local. Are we building the more distant bonds?  That’s a lot trickier question.

LeClair: We’ve covered a lot of territory. In the remaining time, what is one question you wish we would have asked?

Tufano: Maybe it’s not a question but an observation. In our sector, business education, we have largely acted as if we’re all competitors. That’s not to say that what you’re doing and what EQUIS does and what AACSB does isn’t helpful. Of course, academics always share as part of a global community. The scientific community is coming together right now in the biggest moonshot projects that have ever been seen, to try to increase the speed of vaccine development by a factor of 10. Usually a vaccine takes 25 years to develop and they’re trying to do it in 25 months or less. The scientists are coming together to think about moon shots.  But we, in business schools, are still working separately.

Why is that, and what can we do about that? I had proposed to some of my colleagues at other schools before all this, that we needed to work together on questions around climate and there was a lot of slow walking on that conversation. I think we’ve got to do the same thing here. We’re working across, for example, the Creative Destruction Lab network on a programme called CDL Recovery [to rapidly transform technological innovations into useful products and services that address public health and economic recovery challenges created by the global COVID-19 crisis]. We are part of a group of seven schools. But if the elite business schools of the world want to demonstrate that we in fact do have something special to add to the world, we’re not going to do that by all doing our own thing. We’re all doing our own webinars and seminars—which are great—and we’re all asking, as we should, for support from our alumni for our students who are going to find it hard to get jobs.  But, we are not joining forces.

We’re part of the GNAM network. We’re part of a bunch of different networks, but I think realistically right now, people in my role largely have their heads down, because we’re only a few weeks into this crisis. I think the expression on a plane is, put your own mask on before you help others. And I think that’s largely what we’re trying to do. I think Oxford Säid is in a good place, because we’ve got a great team. Our mask is largely on, so I’m starting to think about who else we need to work with in order to support recovery.

We have a common enemy and that is this pandemic. The UK has created a common hero, and that is the NHS. The public service ads say “stay home, save lives, protect the NHS.” That’s the slogan.

“When we come out of this, another common hero will be our medical colleagues who are playing a big role in the first crisis–which is the health crisis. My hope is that business schools are also seen as playing a major role in helping address the second aspect of the crisis, which is the economic crisis.”

That we can be proud of our joint contribution to addressing issues of global prosperity and justice.  That’s my hope, that we will have made a contribution to the world that is bigger than what any one of us could have done alone.


This interview was conducted by Soumitra Dutta, Chairman, and Dan LeClair, CEO of GBSN. This edited transcript was prepared by Shefali Rai. 

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