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Your Turn How B-Schools Drive Productivity The increase in U.S. productivity has been a source of considerable debate in eco- nomic, business, and government circles. Is the past decade's growth sustainable? Which sectors or types of jobs are most affected? Why has the increase persisted during the recent recession? What are the policy implications? In an expanding global economy, why aren't other countries experiencing the same increase? What are the drivers? These questions and the debate itself go on and on. But while "bet- ter management" is sometimes men- tioned as one of the drivers of busi- ness productivity, I assert that busi- ness school leadership is also a pri- mary catalyst. I also think that busi- ness schools should do a much bet- ter job of communicating how man- agement education and research contribute to—and even drive— business productivity. From 1998 through 2002, out- by Susan M. Phillips left out of the discussion about pro- ductivity. Productivity gains, often acknowledged to raise the standard of living in the long run, are linked to factors such as the introduction and adoption of technology innova- tions, improved information or data, and restructuring of labor and prod- uct markets—not improved educa- tional methods. As a result, the pub- lic generally does not recognize ment" in Philadelphia nearly 125 years ago, business owners and man- agers have continued to engage aca- demics on many levels to achieve results benefiting American business practice and the greater economy. Early business school faculties gener- ally comprised business practitioners and academics from other university departments like mathematics, eco- nomics, sociology, and psychology. Their research focused on work processes, new technologies, and employee conditions—issues that continue to affect productivity and are taught in business schools today. Of course, business research and put per hour in the non-farm busi- ness sector in the U.S. (a conven- tional measure of productivity) increased at an average annual rate of 3 percent—more than twice the average pace over the previous four decades. And the increase continues in 2003. Deregulation, a surging stock market, and declining technol- ogy prices have freed up capital for managers to invest in productivity- enhancing technologies like comput- ers, software, and communications equipment. Such investment has enabled businesses to better manage supply-chains and inventories, access customers, and maintain records, boosting productivity along the way. Too often, business schools are 54 BizEd NOVEMBER/DECEMBER 2003 business schools' contributions to these economic advancements. This lack of awareness exists even though management innovation through education and research has been integrally connected to the pri- vate sector since 1881, when one businessman's interest triggered the emergence of all business schools. At that time, Joseph Wharton, propri- etor of American Nickel Works, asked University of Pennsylvania trustees to develop the world's first school of business. His pioneering vision was to raise the status of business education to the level of professional schools for lawyers and doctors. Since that "provincial experi- education have taken on new dimen- sions over the last several decades, adding new areas of inquiry such as marketing, derivative pricing, and quantitative methods. When the Ford and Carnegie studies of the late 1950s claimed that business was not a dis- tinct academic field because its profes- sors needed doctoral-level education, business doctoral programs grew at an astonishing rate. Business schools began to adopt a more deductive approach, and education became more rigorous in theory development and quantitative measures. Modern business school research initiatives often encompass testing of new management techniques to vali- date, disprove, or measure their effectiveness. Faculty research initia- tives have developed theories, prac- tices, and programs that are con- veyed through business schools and applied in the marketplace, resulting in improved productivity. For exam- ple, academic and management guru Peter Drucker has taught people how to manage more effectively. More recently, Michael Porter has developed theories related to com- petition that teach business students