A recent headline in The Economist¹ proclaimed that MBAs were “Not All Bad”: while the esteemed publication could be accused of damning business schools with faint praise, the theme was a familiar one. In spite of (or perhaps because of) the success of the MBA degree, the value of management education has been fiercely debated for many years. The debate has heated up recently with the revelation that several of the principal actors in the recent economic meltdown held MBAs from reputable universities.

Debate in the popular business literature has mirrored a great deal of soul-searching within the business education community, and articles criticising one or more aspects of the MBA have been appearing in management journals for many years. Recently, critiques have tended to come from three principal directions:

• Values: Management education does not foster in its graduates an appropriate set of ethical values. As one author put it, “By propagating ideologically inspired amoral theories, business schools have actively freed their students from any sense of moral responsibility ².”

• Relevance: Business schools produce research that has little relevance to management practice, and consequently, teach students theoretical concepts that are of limited usefulness to managers: “Some of the research produced (by business schools) is excellent, but because so little of it is grounded in actual business practices, the focus of graduate business education has become increasingly circumscribed—and less and less relevant to practitioners ³.”

• Pedagogy: Business schools teach inappropriate material, using ineffective teaching methods, to the wrong students: “It is time to recognize conventional MBA programs for what they are—or else to close them down. They are specialized training in the functions of business, not general education in the practice of managing. Using the classroom to help develop people already practicing management is a fine idea, but pretending to create managers out of people who have never managed is a sham ⁴.”

One proposed solution⁵ is to reshape business programmes to include elements of design education. In this article, I explore the meaning of design in this context and the contribution it could make to management education. I describe how a design course taught in Austria exposed students to new ways of approaching problems.

Contemporary management problems are characterised by instability, unpredictability and conflicting interests among multiple stakeholders—in other words, ‘wicked’ problems ⁶, a “class of social system problems which are ill formulated, where the information is confusing, where there are many clients and decision makers with conflicting values, and where the ramifications in the whole system are thoroughly confusing ⁷.”

Since Nobel Laureate Herbert Simon⁸ called for a new management curriculum based on design, several authors have argued that managers can learn a great deal from the approach taken by designers ⁹. Because designers are traditionally engaged for their creativity, it is with this quality that they are most closely associated. However, a great deal of research and reflection are required to develop ideas. Designers frequently need to reinterpret a brief to identify the underlying problem; to visualise abstract solutions; and to integrate information from multiple sources. Designers’ skills in framing problems in a meaningful way and integrating the components of a solution can also be applied to managerial problems. Beyond skills, a design ‘attitude’ views managerial problems as opportunities for invention and development of elegant solutions ¹⁰.

But the design approach is quite different from typical management practice and from business education. Business students learn to decompose problems and optimise between clearly specified alternatives, an approach that contrasts sharply with the characterisation of design as a “reflective conversation with the situation ¹¹,” in which the designer attempts a solution, reframes the problem and tries a new approach ¹².

A representation of the design process is given in Figure 1¹³. This is by no means the only way of approaching design problems, but it offers a reasonable representation of the process applied by many user-centred designers. The emphasis is on developing a deep understanding of the problem before attempting to develop solutions.

A notable feature of this process is that problem definition is provisional and iterative: the design team begins with Statement of Intent 1.0 and modifies this according to the findings of its research into users and their context, business and market issues, and design and technological constraints. Several Statements of Intent may be developed before a definition of the problem is agreed upon and design principles developed. Throughout the process of problem definition, the team experiments with tentative solutions and explores aspects of the design problem through research and prototyping.

With an agreed set of design principles, the design team proceeds to use creative techniques to develop solution concepts and business models, and to implement the design. This part of the process is also iterative as the team delves into its research to refine its solutions.

A critical element of this process is the impact of the design on human beings. Designers need to understand users’ needs intimately and integrate this understanding with information from other sources. Ethnographic research provides a deep understanding of users’ physical, cognitive and emotional perspectives. To interpret this information, designers approach it with an attitude of empathy and employ systems thinking.

Empathy is defined as perceiving the internal frame of reference of another person as if one were the person ¹⁴.In user research, this means treating users not merely as instrumental objects of study, but engaging in an intimate process of feeling and sensing with other human beings.

In management, the term ‘user’ can be interpreted broadly: the ‘users’ of a balance sheet may be financial analysts; the ‘users’ of an organisation design may be employees. Managers need to be just as engaged with these users as designers are with users of their designs: as human beings who bring a personal context to their engagement with the initiative.

Designers need to develop systems thinking—an ability to think broadly about the design problem—for two reasons. True empathy with users is only possible if one understands the user’s context of use: not merely the usage situation, but the user’s personal perspective based cultural, linguistic and emotional factors. The second reason is that effective design is not limited to products alone, but provides value to users from the integration of organisational and network resources. Thus effective design requires the designer to understand both the user’s context and that of the client organisation.

To appreciate the relationships that form the system, designers use both traditional analysis and develop a synthesis of the system as a whole.  Because management problems are often shifting, difficult situations characterised by complex interrelationships and multiple stakeholders, they also defy easy solutions. Systems thinking has therefore been of interest to management scholars for some time, and the popularity of Peter Senge’s book The Fifth Discipline¹⁵ attests to the desire for a fresh approach to complex problems. In management, as in design, the key considerations are the relationships between consumers, employees, shareholders, managers and other stakeholders.

The design model has profound implications for management education.

In a management degree based on the principles of design, students would learn to develop an attitude of empathy and skills in systems thinking. To accomplish this, they would be required to solve wicked problems by framing the problem, understanding users intimately, thinking creatively about possible solutions, using analysis and synthesis to develop an understanding of systems and their component parts, and collaborating in diverse teams. This does not, however, mean that design courses would supplant those currently being taught in business schools: what is needed is mostly a shift in attitude and focus rather than a large new body of material. Nevertheless, these principles have important implications both for curriculum and teaching methods, as discussed below.

Curriculum
MBA students learn a wide variety of techniques for analysing business problems, but typically apply them to well-defined problems. Problem sets, exams and cases, for example, often spell out the alternatives available for comparison. Missing from the education of a typical business student is a discussion of how to identify the correct problem to work on, and how to think about new, untried alternatives. While business students learn some models designed to help them look at the bigger picture [Porter’s model of competitive forces¹⁶ would be an example], there is scope to go much further and consider the implications of problems for users, markets and societies.

An appropriate attitude is also essential: that users are not just ‘consumers’ to be targeted, but real human beings with thoughts, feelings and needs; that employees are not merely factors of production; and that collaboration with others means understanding how the world appears from their perspective.

In a design-based MBA curriculum, students would learn the following topic areas:

• Problem Framing: To solve problems rather than merely treat their symptoms, students must learn to identify the underlying problem. Students would learn that one’s perception of a problem, and therefore one’s readiness to accept solutions, depends on how it is framed. From fields such as Root Cause Analysis, students would learn practical methods for understanding the dimensions of a problem.

• Ethnographic Research: As noted earlier, ethnographic research methods are used extensively by designers; they are also becoming popular in business. Qualitative methods, including user observation, are currently included in many market research courses. However, the epistemologies and assumptions underlying ethnographic methods differ fundamentally from those associated with quantitative methods. Interpretivist approaches, for example, assume that truth is a set of socially constructed realities, and the researcher’s task is to look for meanings held by participants; other traditions, tracing their roots to Foucault and Marx, emphasise the interrelationships between power and knowledge.

In a design-based MBA, there is room for both quantitative and qualitative approaches. Both would be used in concert to develop a subjective, intimate, understanding of the user, in contrast to the distancing and dehumanising effect of regarding consumers as statistics. Because of the differences in underlying epistemologies it makes sense to offer separate courses, but framed by a common philosophy of user intimacy.

• Abductive Reasoning: Abductive reasoning, in contrast to deductive reasoning and inductive reasoning, is thinking about what might be possible. In Aristotelian logic, inductive reasoning is generalisation from specific instances, while deductive reasoning involves inference from logical premises. Abductive reasoning proceeds by the observation of a surprising phenomenon that confronts pre-existing beliefs, reflection on the assumptions that led to the surprise and revision of these assumptions; it includes creativity, or transformation of the conceptual space. To learn about abductive reasoning, students would learn to identify their own implicit beliefs and assumptions and to confront these by generating alternative solutions to problems through creative processes. They would additionally learn how organisations can be managed to encourage abductive reasoning.

• Synthesis: As noted earlier, the components of systems thinking are analysis and synthesis. Students would learn to integrate analytical and synthetic methods to arrive at an appreciation of the larger context for business problems. This does not mean abandoning a reductionist approach, but learning that the relationships between components of a problem are just as important as the components themselves. The approach has already been widely applied in operations research: for example, the MENTOR system¹⁷ has three stages: Problem Formulation, Modelling and Implementation. Synthetic and analytical methods are used throughout the process, in which identification of the problem and the system are emphasised and the process is iterative.

• Collaboration: The prevailing approach in business schools to working with other students is a confrontational one in which ideas compete for acceptance. This works against the need to confront one’s own assumptions in framing and solving problems, and the element of surprise when these assumptions are confronted. In a design-based business school, students would learn to work collaboratively, rather than confrontationally, in groups. However, groups of relatively homogeneous business students are unlikely to go very far in shaking each other’s assumptions, and there is a role for external intervention, either through facilitation that pushes students to reflect or through group organisation to maximise diversity. There is also an opportunity to increase group diversity through alliances with other institutions.

Teaching Methods
A significant portion of students’ effort in a user-centred business degree would be devoted dealing with ‘wicked’ problems in practice.

Standard teaching methods in business schools—lectures and cases—are capable of providing students with management tools. However, since these methods typically present problems as well defined, and indeed often provide students with alternatives to compare, they will not be successful in imparting many of the concepts and skills of design-based management. The role of lectures and cases would be to help students understand the concepts in simplified form; students would then apply these skills in real-world projects that defy easy definition and require them to generate their own alternatives based on their understanding of users and of the system.

The foregoing principles underlay a course in Strategic Innovation offered at Johannes Kepler Universität in Linz, Austria in 2007. The students were undergraduate business students in their final year, and the course consisted of a project based on the design process shown in Figure 1.

The course description was as follows:

This course is a reflective practicum in the process of innovation.  Students will be introduced to a user-centred design process and, in teams, will apply this process to develop either a new product/service idea or a business strategy for an existing product/service.  Lectures and discussions will highlight the key stages in the process, and students will reflect regularly on their own individual approach to strategic innovation.  By the end of the course, students will have developed a generalized, individual framework for strategic innovations they will face in the future.

There were five plenary sessions over the course of a month, interspersed with work in small groups. Following an initial session introducing them to the process, students proceeded to develop an initial Statement of Intent (an overview of what they were trying to accomplish), conduct user research, develop insights and design principles, develop a reframed Statement of Intent and present initial concepts. The focus throughout was on designing a customer experience; the students were divided into three groups, each of which selected a project: a zoo, a financial service and a retail art store.

Students were assessed in groups according to the quality of their final presentation and individually on a reflective journal that discussed their learning about the innovation process. Data on the course were collected from student journals and from depth interviews conducted by a graduate student who participated in the course.

In the initial phase of the course, students identified problems to work on and developed a preliminary Statement of Intent, encapsulating their overall goals for the process and what they hoped to design. The financial services group, for example, was interested in providing low-cost loans to students.

Students collected secondary data and observed and interviewed potential users for their experience. This led them to rethink their original problem statement: the finance group, for example, saw that there was little demand for student loans, but a great deal of interest in making sense of financial information, and revised their Statement of Intent accordingly.

For students accustomed to a linear ‘formulate-then-solve’ approach, reframing the problem in this way was a new experience. Several students commented on this in interviews: “We actually uncovered a totally different problem from what we actually believed.”

The discovery that they had misidentified the problem came quite late in the course for some students, after several phases of research. At the time, it appeared as a setback but students eventually came to appreciate the nonlinear­ity of the process. One student wrote as follows: “The redefinition of our research question helped us to focus the problem. So I learned the right question can help me to [understand] the problem and to focus on [users’] pain points … each redefinition made us get two steps ahead.”

The students were also introduced to brainstorming and developed conceptual prototypes of their proposals, in the form of collages, as a means of refining and communicating the idea (see photographs). The idea of developing physical representations of ideas as part of the problem-solving process was a new and intriguing technique for the student groups. Physical representation brought out ideas that could not be expressed verbally and helped the team members understand each other: “It is important to be able to express the thoughts and emotions not only with words, but even with pictures and other creative techniques because not every feeling can be expressed only with words. Only if there is something […] your colleagues can touch, can they start to understand the meaning of the idea.”

While the overall experience of the course was positive for the students, there were nevertheless limitations. The limited time available for the course restricted the students’ ability to absorb and fully implement the new process: more time would have allowed for richer, deeper user research and more thoroughly elaborated implementation plans. In addition, students had difficulty with the ambiguity of the final assignment and sought clearer direction.

In spite of the limitations, several students found the approach tranformative, as exemplified by the following quote: “Having a look on my everyday life, I often find myself looking out for possible solutions when I recognize a problem. I cannot stop that, it is crazy! But I like it. Next week, I start an internship in the international human resources management at an Austrian production concern. In my mind, I already have so many approaches to innovate the existing tools and habits that I would like to go there and change everything.”

Managers and management academics have come to re­cognise that the problems faced by businesses have become more challenging and difficult to define. Problems of this type cannot be solved through the linear methods commonly taught in business schools. Designers, on the other hand, deal with such problems on a daily basis and managers have therefore turned to design as an interesting approach to problem solving in management.

The business school curriculum would need to change in order to accommodate the different approach used by designers; however, rather than simply add courses, the design approach could serve as a means of coordinating and synthesising the skills learned in traditional courses. The application of design methods to a project can expose students to new and radically different ways of thinking.