″We All Have a Responsibility to Compete″ | Business| Economy and finance news from a German perspective | DW | 03.02.2006
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"We All Have a Responsibility to Compete"

Chancellor Angela Merkel will attend the opening of a new business school funded by some of Germany's largest companies Friday. Public universities could benefit from the concept, the school's president told DW-WORLD.


Abell believes a private-public mix is key to compete in the global academic marketplace

Thirty students are currently enrolled in the first Masters of Business Administration (MBA) program at the European School of Management and Technology (esmt), which was founded by leading German companies including Allianz, DaimlerChrysler, Deutsche Bank, Eon and ThyssenKrupp. Its president, Derek F. Abell, taught at Harvard Business School and the International Institute for Management Development (IMD). He will step down in September, but has no plans to retire. "Life is long and the idea of retirement is not quite the right one," the 67-year-old said. "We all have to pass on to further projects which are interesting for us and keep us alive."

DW-WORLD: Prof. Abell, if I am looking to do an MBA, why would you advise me to come to esmt and not to any of the schools you've taught at that offer similar programs?

Derek F. Abell: We have a very strong relationship with 25 great companies -- maybe some of these companies are interested in recruiting you at the end. Our MBA program has a couple of extra twists. There's quite a lot of special attention to European business practices. And there's a lot of attention to technology and management and technology-based business.

You have said that Germany needs more leadership programs and less management training. What do you mean by that and what is the school offering in that respect?

Neues Leben im Staatsratsgebäude

The East German coat of arms still adorns an esmt lecture hall. The building used to house the East German government.

If your goal is to help people to take charge, which is our goal, then management education is only a part of the story. Someone who is taking charge of something has to get things done, not only to analyze them. This part is not in many management courses of the traditional type. We are paying as much attention to the task of how to get things done as to the task of how to think about things. And finally, there's a lot to think about in terms of your personal role in all this. How do you link your personal purpose to that of your enterprise and to that of society at large? So when I say leadership training, I mean the whole package that's helping people to really stand up to the mark and take charge of something.

One of your research interests is the responsibility of executive leaders to look beyond the bottom line. Do you think that the companies that fund the school might not like your approach?

It's true that some people who are running large companies believe that their responsibility is just to squeeze things out so the shareholders get a fast and quick buck. But this is not the way to do it. We teach our participants that they are in a very competitive world and that we all have a responsibility above all to compete. Many people are trying to find ways around that and hope that globalization doesn't happen or that it doesn't continue. But the fact is, this is the way the world's going to be. Number two: A responsible manager has to worry about maintaining the value-creating machinery of his enterprise by giving square deals to all the players -- employees, managers and society at large. We used to be in a world were people who owned shares held them for long periods. We're in a world now where there is a lot of trading shareholding. Managers are under pressure from a lot of trading shareholders to make quick killings. Managers forgot that this is not their responsibility. Their real responsibility is long-term building, not short-term squeezing.

Germany is currently facing a debate about creating elite universities. What do you think about this?

Ehemaliges Staatsratsgebäude der DDR

A portal from Berlin's destroyed imperial palace adornes the school's facade

The question for me is not whether German universities are excellent in Germany. The question is: How do they measure up with respect to global competition. These institutions are competing worldwide for almost everything -- for professors, for students, for funds. It's almost essential in Germany that we start to generate a level of private education, one to remain competitive and two, because public money is not available. It's not going to be done in a few years. It's going to be a number of decades before we arrive where we need to be to compete on a global scale with some excellent institutions. But the raw material is certainly there in Germany.

What would you advise the government and the public universities to do to compete in this new academic marketplace?

I was once asked by some people from a public company what they should do to prepare themselves for new global competition. I deliberately gave a provocative answer. I said: "I would split your company into two parts and I would let them compete with one another." I would let universities compete with one another more actively. I would just take away some of the artificial barriers to competition and put them out in the market and see what happened next. The market will work. The market always works and the market will work in education. It will make people creative.

Where do you see this school in 10 years?

Derek F. Abel

"Despite it all," reads the stained glass window with pictures of communist leaders Karl Liebknecht and Rosa Luxemburg in the school's entrance hall

The school's founding fathers had a vision of what the school should look like. It was essentially to build in Germany a force in international management education, a force that would of course support European business, but a force that would take some of the best practices in Europe and spread them around the world a bit, because we do some good things here. There were many misunderstandings when we started, some people said "Harvard on the Spree (Berlin's river)." Actually quite the reverse is true. What we're trying to do is to put a bit of the Spree and a bit of Berlin and a bit of Germany and a bit of German industry and frankly a big dose of Europe into what is predominantly an Anglo-Saxon model of business education so far in the world. We've got a long way to go, but we've embarked on this course with quite a lot of vigor and I feel very good about it.

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