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How to manage an organisation’s response to COVID-19

Anton Korinek offers advice to organisations and Business Schools on responding to the emerging international situation resulting from Coronavirus or COVID-19

Organisations around the world are working through how to respond to the novel coronavirus, posing one of the greatest challenges to leaders in a long time. Do they restrict travel? Doing so would have substantial financial implication, make months of preparation worthless and lower the morale of many stakeholders who enjoy travel. However, travel is what brought the coronavirus to the country in the first place — and what continues to spread it to new communities within the country.

What about instituting remote work procedures? In-person meetings and events may be a critical part of an organisation’s activities and an important part of the value it offers. Perhaps there are no known cases of the virus in a given community. However, once it does gain a foothold, social distancing is the only way to slow the spread. Carriers of the virus may unwittingly spread it for days before symptoms manifest themselves. 

Above all, one of the greatest challenges is to balance an organisation’s economic concerns with the question of what is ethically the best course of action.

How we got there

The novel coronavirus was first identified in Wuhan, China, in December 2019. It jumped from bats via an intermediate host (most likely pangolins) that was traded in live animal markets to humans. The virus has officially been named SARS-CoV-2, and the disease that it causes has been named “coronavirus disease 2019” (abbreviated COVID-19). It spreads among humans via respiratory droplets from coughing as well as by touching infected surfaces. In an uncontrolled outbreak, the disease burden grows exponentially, with cases doubling approximately every six days. The incubation period, i.e. the time between when one is exposed to the virus and when one develops symptoms of disease, is from two to 14 days, with an average of five days.

Those infected usually present with a fever, a dry cough and general fatigue, frequently involving a mild form of pneumonia. About 15–20% of cases develop more severe pneumonia that requires hospitalisation, intensive care, and in many cases, mechanical ventilation. The latest World Health Organisation estimate of the fatality rate is 3.4%.

Why should organisations take action?

Some may argue that it’s up to individuals how much risk they’re willing to take. But becoming infected affects not only yourself but also endangers others, as infected individuals can spread the disease and expose their community to the substantial risks involved, up to and including premature death. There is thus a crucial ethical component to the public health precautions that individuals and organisations take. Economists call this public health aspect of infectious diseases an externality – in other words an effect on others that an individual or organisation that only cares about their own well-being is tempted to ignore. (A typical example of another type of externality is pollution – when an individual pollutes, society as a whole suffers.)

When an individual spreads the disease it does not impose any cost on them, but costs the newly infected dearly. In fact, the externalities of infectious diseases come in two forms: healthy people not taking sufficient precaution to avoid becoming infected (because they do not internalise the risks this will create for others) and exposed people not taking sufficient precaution to avoid spreading the disease.  

Others may challenge the idea of whether to try to contain the virus at all. The disease seems unstoppable — it has spread around the world in a matter of weeks. Why go to such extreme lengths and incur enormous economic costs to try to prevent the unpreventable? Aren’t we all just caught up in a bad case of mass hysteria that is even more infectious — and pernicious — than the coronavirus itself?  However, that argument neglects all the lives at risk and the extent to which an uncontrolled outbreak risks overwhelming medical resources and exacerbating the ultimate death toll. 

Disproportionate impact

What adds to the challenge on how to respond is the highly disproportionate impact of the disease on different people. The elderly and those with pre-existing conditions are at much greater risk of death from COVID-19 than others. For example, taking into account all the risk factors, a male in his 70s with a heart condition who contracts the virus has a risk of death that is significantly higher – perhaps in excess of 25%. (Useful information on mortality rate by demographics can be found on world statistics site Worldometer.) 

Lessons from China and Italy

The experience of regions that have dealt with large outbreaks of COVID-19 in recent weeks, chiefly Wuhan and northern Italy, suggest two lessons. 

  • First, there is no place for fatalism in epidemiology. The fraction of the population that is ultimately infected by an epidemic is actually quite responsive to mitigation efforts. Wuhan has been able to get the virus under control by imposing tight quarantine measures on its citizens. Italy followed suit recently, with the outcome yet to be determined. 
  • Second, due to the exponential nature of the spread, an uncontrolled outbreak risks overwhelming a country’s health care infrastructure. About 15–20% of identified cases require hospital care. Even in the US, an uncontrolled outbreak would quickly exhaust the capacity of existing ICUs. If this were to happen, the fatality rate of the virus would be bound to rise significantly because sick patients could no longer be adequately treated. This suggests that it is critical to try to slow down the spread to keep the number of patients at any given time more manageable. 

What we should be asking and answering

Organisations need to determine how to answer the following questions:

  • What restrictions do you impose on your organisation’s inward and outward travel and why?
  • At what point will you restrict in-person meetings and events at your organisation? 
  • Should you prepare your stakeholders for these potential changes now?
  • What can you do to make the members of your organisation aware of the externalities that they impose on others, both if they are still healthy and in case they have become exposed to the disease?

The epidemiological realities of the disease have stark implications for organisations. Decisions made now will determine the way that stakeholders will work, travel and interact with each other in coming weeks and months, and it will determine the economic losses companies will experience. And as much as the virus will affect organisations, those organisations’ reaction to it will have a crucial effect on how fast and how widely COVID-19 will spread in their communities, and how many lives will be lost to the disease. This adds a crucial ethical component to the trade-off. Balancing the economic fall-out with this ethical dimension is the most significant leadership challenge of our time.

Anton Korinek is Associate Professor of Business Administration, Darden Business School

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Preparing tomorrow’s leadership for climate change

Schools must help tomorrow’s leaders take decisions together, with those from several areas of expertise, while understanding how these decisions will affect different groups in different ways across the world, say the University of Gothenburg’s Thomas Sterner and Åsa Löfgren.

Global changes are so significant that geoscientists speak of Earth entering a new geological era, the ‘Anthropocene’, during which many crucial variables for the planet are controlled by man, and our activities and consumption patterns risk exceeding the planetary boundaries. This leads to a changed climate, acidification of the oceans, loss of biodiversity and many other global environmental problems. These problems are global, long term and uncertain. They are also interconnected and must be analysed together in order to find solutions that provide synergies and avoid those that solve one problem but worsen others.

For example, it is not sustainable to aggravate problems related to a loss of biodiversity, or vital water/nutrient cycles, when you are trying to solve the climate problem through a poorly conceived forest policy.

Biologists, physicists and other natural scientists document and analyse many of the changes mentioned above, and are usually the ones who write about planetary boundaries and the Anthropocene. Social scientists, meanwhile, are experts on how society and the economy work. Both of these areas of expertise are indispensable when analysing social causes and proposing solutions that are effective and politically feasible. Therefore, collaboration between economists, social scientists and natural scientists is urgently needed to discuss solutions.

An interdisciplinary approach

Business Schools have the important task of preparing students to become tomorrow’s leaders in business and other organisations. It is vital that these aspiring leaders are given tools to understand our current and future predicament since it will be decisive for future success and, indeed, survival. One of the prerequisites for a sound future education is an interdisciplinary approach to problems where this is necessary. When it comes to sustainability, we need expertise that understands both natural and social sciences. 

When training tomorrow’s leaders, standards must be high in all areas. We need interdisciplinary understanding of environmental challenges and opportunities, high ethical standards, and a capability to
work with leaders from other countries, cultures and disciplines. 

The School of Business, Economics and Law at the University of Gothenburg (the School) has taken on this challenge in several ways. Most importantly, it is a strategic mission of the School to integrate sustainability into all education: ‘To develop knowledge, educate and foster independent thinking for the advancement of organisations, policy and a sustainable world’.

Over the the past decade, the School has turned its mission into practice by integrating sustainability-related learning outcomes for all undergraduate programmes and strengthening the progression of sustainability concepts between courses. This allows programme coordinators and lecturers to develop curricula in the knowledge that these learning goals must be met.

Sustainability days

Another important activity is the School’s compulsory sustainability days. The concept was introduced in 2013 and was implemented fully in all undergraduate programmes in 2016. It consists of three full days of focus on sustainability from various perspectives. The overall aim is to complement the sustainability content of courses by raising awareness and providing knowledge around three themes: challenges, responsibility, and solutions. During this time, students from different programmes meet and learn to work with, and respect, those from a variety of backgrounds.

At an international level, and in collaboration with Gothenburg’s Chalmers University of Technology, there is the School’s Environment for Development unit. With support from the Swedish International Development Cooperation Agency, the Environment for Development has trained PhDs from emerging markets in environmental economics for decades and helped build centres in more than 12 countries in the
Global South. 

In the future, the unit’s plan is to co-teach master’s courses with students in several countries simultaneously. In a pilot course run at Chalmers this year, students in Asia, Africa and the US solved problems related to fairness in climate negotiations simultaneously. In a second step, students held discussions with real climate negotiators to develop their negotiating and leadership skills. A capability to work with leaders from other countries,
and understand the positions of other groups or countries, is key to addressing global environmental problems such as
climate change. 

More specifically, while it is important to find effective solutions, it is also important to educate students about the income distributional effects of policy measures and their perceived fairness. These effects are vital determinants of political feasibility and aspects that must be considered carefully when policy instruments are selected and designed. The task is complex since policies need not only be feasible in Europe or the US, but globally. 

There are ways that global environmental problems can be addressed. But the solution relies on there being leaders who are responsible, knowledgeable and understand the importance of, and are open to, collaboration with those who possess skills from other disciplines. Business Schools have a responsibility and an important role to play in the education of such leaders.

Thomas Sterner is Professor of Environmental Economics and Åsa Löfgren is an Associate Professor in the Department of Economics, part of the School of Business, Economics and Law at the University of Gothenburg.

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Future-proofing the MBA

From immersive experiences in Māori business culture to plans for performance metrics to ensure community impact, hopes are high for the revamped MBA at the University of Canterbury (UC) Business School in Christchurch, New Zealand – the South Island’s largest city. AMBA & BGA’s Tim Banerjee Dhoul caught up with MBA Director and Associate Professor, Chris Vas, to learn more.

Can you tell us a bit about UC’s current MBA programme? 

The UC MBA programme has served the Canterbury, New Zealand and global business communities since 1983. Today, a typical MBA student at UC is 35 years old with more than 10 years of professional experience, studying part time. The cohort is well balanced when it comes to gender diversity, but more can be done to improve the programme’s 15% international footprint.  

What are the principal motivations behind the School’s plans to launch a revamped MBA in 2020?

One of the principal motivations was AMBA’s reaccreditation panel visit in 2017. The School also recognised the changing needs of business in the region, particularly in relation to the impact of ‘digital’ on organisations and leadership practices over the next decade; the need to drive intrapreneurship and entrepreneurship;  connectivity across geographies and, most importantly, instilling a sense of purpose and impact – beyond economic drivers – in organisations, and in those who lead them.  

Which single feature of the revamped MBA are you most excited about?

To be honest, the radical changes that we are putting in place across the programme are exciting as a whole. The MBA will be delivered in the same way that a story unfolds: as a narrative and an experience. The programme will commence with a focus on purpose and impact, while honing in on attributes that support innovative thinking. A focus on agile and innovative leadership, meanwhile, will be woven across the entire programme so that leadership is not just a course or subject delivered at a single point in time. 

Having said that, let me give you a glimpse into one aspect of what we’re all excited about. At the start of the programme, MBA participants will be immersed in experiences with New Zealand’s indigenous people – the Māori community – where the importance of ‘place-based knowledge’ intertwined with Māori business culture will be experienced. As the wider University of Canterbury strategy outlines, this experience is important for our students to ensure they ‘are aware of their own identity and its influence in engaging with any other person or community’.

Its incorporation is one way in which our MBA participants in New Zealand can learn to value difference by recognising place-based knowledge. In today’s world, in which we see the rise of protectionist attitudes to trade, migration and citizenship, it is vital that we place importance on issues of identity, especially as these can help bind communities together. 

Beyond this initial immersion, the programme will incorporate learning experiences in Māori economies, to understand the aspirations of Māori communities better and emphasise the Māori proverb that people are the most important thing in the world (‘he tāngata, he tāngata, he tāngata’). Such focus also ties into the programme’s commitment to the United Nation’s Sustainable Development Goal (SDG) 11 around the building of sustainable communities and cities. 

This commitment is backed up by a new course on ‘societies in smart cities’, which will analyse how organisations strategise and connect their purpose to deliver impact in societies through the lens of smart cities. 

MBA participants will be assessed in these courses through their responses to real-life challenges or mini purpose-driven projects that are tied to organisations. In this instance, we are looking to integrate with Christchurch City’s agenda and Ngāi Tahu, a principal iwi [the largest social unit in Māori society which can be translated as ‘nation’] of New Zealand’s southern region, to reimagine growth through sustainable and smart-city initiatives that will create a positive impact on the local community. 

Can the new programme help its students pursue purpose-driven and impactful careers? 

As a central engine of research, development and innovation in Christchurch, we believe it is imperative to sync with the city’s growth plans and drive a consistent effort in that direction. Consequently, we see the importance of driving entrepreneurial activities in the areas of food, health, tech services and transport. Social entrepreneurship is equally important, and the programme will support MBA participants who are looking to tackle issues of mental health, waste management, education and beyond. 

In consultation with the city and members of our advisory board, we will look to set up performance metrics for the MBA programme to ensure our participation as a Business School is active and has an impact. So, hypothetically speaking, during the next three to five years, I would like to see 25% of our MBA cohort start new, scalable ventures in the US, Europe or Australasia. 

To this end, the MBA programme will work in tandem with the university’s Centre for Entrepreneurship (UCE) which offers access
to a network of industry advisors and mentors. Given the dominance of working professionals in our programme already, I would also like to see 30-40% of the cohort drive transformative change within their organisations, especially around digital transformation, business model changes, products or services.  

It’s no longer acceptable for us as a faculty and industry practitioner team to simply ‘talk the talk’, so we’re setting ourselves a challenge of enabling purpose and driving meaningful impact. For instance, thanks to one of our student projects, we are now in discussions with a major health service provider to operationalise sustainable work practices in the organisation. We will aim to have many such impact stories in the years to come. It’s an interesting experience in which student activity has catalysed opportunity for faculty.

How will the MBA help students identify solutions to emerging technological issues? 

As part of the MBA review and redesign process, we recognised that our MBA was likely to be redundant in about five to seven years. 

A key reason for this is the pace of technological developments, the impact it has on organisations in terms of strategy, leadership, customer experiences and the whole gamut. 

This being the case, in the revamped MBA programme, we’ve chosen to emphasise aspects around digital transformation, technology preparedness and data-driven strategies. Given their profile (mid- to senior-level managers) our students need to be aware and engaged with technological developments rather than become experts in them. They need adequate levels of preparation and knowledge so that they can ask the right questions, understand the limitations of technology, and at the same time be proficient enough to lead teams to deliver on outcomes. 

Consequently, courses will have a focus on emerging technologies, such as the internet of things (IoT), big data, AI and blockchain. A deep dive will be in the area of data analytics, working on livebprojects under the guidance of industry experts to demonstrate the value of technology platforms, such as Python and Tableau, in data analysis, visualisation and optimisation – all of which should inform organisational strategy.

How has the programme’s development sought to incorporate employer demands as well as those of students?

As part of the MBA review process, our current students identified issues that were of high importance to their organisation and in which they sought further development. The top three were: innovation (to create new products and services); sustainability (incorporating social and environmental aspects); 3) digital transformation of business models, people and processes. 

An added element of need that found its way into responses was the challenge of tackling international markets. Similar issues emerged in my conversations with employers and organisations, though they also voiced the need for further preparation in methodologies such as agile, technological proficiency in addition to development in harnessing an innovative mindset, communication, presentation skills and the ability to problem solve in teams. 

The revamped MBA programme will aim to incorporate these aspects in its courses but will also provide several ‘wrap-around services’ outside the programme; for example, workshops on interpersonal skills and media training that help develop well-rounded MBA graduates. 

Students will also have the opportunity to be coached formally by industry experts to tackle developmental challenges. Finally, the programme has introduced a ‘creative challenge’ course in which students will focus on themselves as the creative project, pushing their limits (and where failure is an option).

What does your ideal MBA candidate look like, and what makes a cohort ‘right’ for UC’s MBA programme?

One of the key programme changes will be the blended nature of delivery, wherein there will be an almost equal split of real-time online interaction and in-person intensive block weekends. This will enable participation from across Australasia. With the industry links we activate and the end outcomes we are looking to deliver in three to five years, UC’s ideal MBA candidate will embrace risk, enjoy a challenge, and be keen on making a difference as well as willing to lead and drive change. 

Our ideal cohort will be gender balanced, diverse – with at least 30% representation from both the international and Māori communities – highly experienced, and representing a cross-section of sectors.  

In your opinion, what will be the biggest challenge facing tomorrow’s leaders and what will be the most important skills and attributes required of them? 

Relevance. The pace of technological development means that innovation will continue to thrive, creating new products, services and firms, and forcing organisations to prove their ongoing relevance. 

This will be the real challenge for leaders over the next decade. Not only will the challenge be for leadership relevance in the context of managing and motivating teams while ensuring a sense of followership in people management, but it will also be for leaders to ensure relevance of their organisations. Uber, Airbnb, Facebook, Tesla and Apple’s iPad are all about 10-15 years old. The next 10-15 years will bring about new innovations. So, for today’s organisations and leadership to remain relevant, maintaining customer experience, organisational purpose, community engagement and societal impact becomes key.  

What do you feel is the main challenge facing Business Schools in New Zealand and the surrounding region? 

Agility. There’s much captured in this one word. Let me elaborate on two aspects. In many parts of Asia Pacific, there is a lack of trust between Business Schools and industry, or universities and industry in general. 

This distrust has resulted in reduced collaboration due to the divergent goals of Business Schools and those of industry, to the extent that we see increasing competition with consultants who have ventured into the areas of research and training. 

The second aspect is around the agility of a Business School to alter course and rethink its business model. Most institutions continue to focus on models that delivered success in the past, but these are unlikely to be fit for the future, given technological advancements in the areas of, for example, new forms of AI-driven and customised online learning. Very soon, if not already, the opportunities in this arena could all be up for grabs.

Chris Vas is Associate Professor and MBA Director at the University of Canterbury’s (UC) College of Business and Law, which houses UC Business School. He holds a PhD in public policy from the Australian National University.  

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The value of lifelong learning

Judith Hanika-Grünn, Group Expert, Executive Development and Change Management at Raiffeisen Bank International AG, was a keynote speaker at AMBA & BGA’s Business School Professionals Conference 2019 in Vienna, Austria. Here, she discusses the importance of lifelong learning and how MBA qualifications can add value

Why do you value the importance of lifelong learning for employees? 

Lifelong learning is a given. There is no life without learning. We do it anyway. The only differentiation is that you can do in a smart or less smart way. Lifelong learning is a must.

Anyone who has been employed over the past 25 years has had to learn, and that’s whether or not they have attended formal classroom training, or they would no longer be in employment. 

How do you see MBA qualifications adding value to your business? 

MBAs are one of many ways in which we can support our employees in their development. It’s very selective due to
the cost and the time needed for an MBA. It’s not a format that will suit everybody, but for certain people, perhaps those with a technical background who are now stepping up to a more managerial role, for example, an MBA can really help them broaden knowledge and expertise. 

What does ‘good’ look like in an MBA graduate? 

I look at MBA graduates and compare them to how they were when they considering doing an MBA. 

What I first see is that their self-esteem has grown in a very healthy way and the achievement of completing a part-time MBA alongside a full-time job. It is a challenge and if you’re able to do it, it’s a very cool thing. Of course, they have also gained cutting-edge knowledge and built a network beyond their own industry. Our industry is banking, for example, but on an MBA you will normally meet people from outside financial services and this broadens your thinking and expectations. 

What advice would you give to someone considering taking an MBA? 

The first thing is to have a good reason for doing it. You should be very clear about this, perhaps writing down your reasons and sticking them on a pin board at home so that whenever you experience doubts, you remember why you are doing it. You should also ensure you have the support of family and friends, as well as your team and colleagues at work.  

How can MBAs be sure to use their skills in business once they have finished the programme? 

From my experience of colleagues studying MBAs over the past 12 years, as soon as they began studying a particular module or topic, they started discussing with colleagues what they could do differently in their job. This comes naturally.  

This article previously formed part of a larger feature published in Ambition, the magazine of the Association of MBAs.

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Ensuring managers of the future have the skills they need

Vladimir Vano, Group Economist at CentralNIC Group, was a keynote speaker at AMBA & BGA’s Business School Professionals Conference 2019 in Vienna, Austria. Here, he outlines his views on the changing workplace and how new skills will be required to grapple with digitisation and automation

What topics did you cover in your talk at AMBA’s conference?

I focused on how MBA programmes should prepare for the automation, robotisation and technological transformation of the workplace. How should MBA programmes change, in order to adapt to that transformation? The answer is by focusing on the following seven skills that are unlikely to be automated in the foreseeable future: 

  1. Effective communication skills
  2. Critical thinking skills and having an innovative and creative mindset
  3. Having a broad perspective and the ability to understand context
  4. Emotional competence: self-awareness and social awareness 
  5. Teaching and coaching skills; the ability to lead people
  6. Networking skills and the ability to build fruitful relationships 
  7. A moral compass: the ability to make ethical decisions and having a set of core values

How will digitisation and automation change the workplace of the future? 

We are talking about the third generation of automation. It began, in the 20th century, with the automation of repetitive, mundane manual work and tasks. In the 21st century, even decision-making processes will be replaced by the machines, algorithms and AI. From the economist’s viewpoint, digitisation and automation should free up humans to take on more fulfilling, creative tasks, leaving the repetitive, mundane and boring tasks to the machines. But the workplace of the future will be a blend of semi-autonomous, or even autonomous, machines which will interact with and work alongside humans.

How can the managers of the future ensure they have the skills needed to remain employable? 

I would say that there are five steps towards remaining employable in the future, and these are to:

  • Upgrade your level of education: take an MBA or do some executive. education; keep challenging yourself
  • Strengthen your ‘human skills’ that cannot be replicated by machines.
  • Learn to interact with, oversee and monitor the machines and algorithms that will be present in the workplace of the future. 
  • Find a niche that is too expensive to automate.
  • Learn to code; it will be one of the basic skills of the future. 

What are the ethical implications of the digital revolution? 

In the analogue world, business leaders were focused on optimisation; satisfying the needs of existing customers using the resources available to them. 

There was a limited workforce with the required skills available. However, now, you can create as many robots as you need. You can optimise your profits in line with global demand. 

Therefore, digitisation is significantly broadening business horizons and bringing ethical dilemmas to the fore. This means it will be even more important to have strong human leadership to set boundaries. In future, with the almost unlimited supply of robot workforce, we may be able to produce cheap gadgets for literally everyone on the planet – potentially putting a huge strain on the environment. Do we allow this to run unchecked, despite the consequences for the planet? That’s just one example of an ethical dilemma we will face going forwards; another is the potential dangers associated with driverless cars. 

There will be a growing need for leaders to have a moral compass – something that cannot be replicated by a machine and that should be in a manager’s core skill set.

This article previously formed part of a larger feature published in Ambition, the magazine of the Association of MBAs.

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How can artificial intelligence create value for business?

The Artificial Intelligence in Management (AIM) Institute at France’s Emlyon Business School is studying real-world issues facing organisations, in an interdisciplinary way. David Woods-Hale speaks to AIM’s Executive Director, Renaud Champion, to find out more

Artificial intelligence (AI) has been a talking point among Business School leaders for years, as institutions grapple with the most effective ways of preparing students to operate in the world of robotics. Renaud Champion, Executive Director of the AI in Management (AIM) Institute at Emlyon Business School in Lyon, France, tells us how his School is addressing the challenge.

What does your role as AIM’s Executive Director involve?

My mission is to design and implement the School’s AI strategy at every level, from research to pedagogical content and the development of digital tools. 

Given my background as an entrepreneur and an investor in AI and robotics, I have experienced how these technologies are already impacting companies dramatically, in terms of the way work is organised and done, and how they create value. The DNA of the Institute was therefore based around two main questions, which seemed both obvious and relevant from a Business School perspective: how can AI generate value; and how is AI impacting work and governance?

I developed the AIM Institute eight months ago, as a startup within the Business School, to galvanise interest in, and action around, this strategy. But to be successful, a good startup needs the right team, so involving recognised researchers in this ambitious initiative was a first key step. 

After only a few months and thanks to the work of the AIM Research Directors, Professor Ruthanne Huising and Professor Margherita Pagani, we already had 20 researchers from different backgrounds involved and were expanding quickly. We could also count on the involvement of Emlyon’s Scientific Committee, made up of leading academics from Stanford, Ecole Polytechnique Fédérale de Lausanne (EPFL), University of Texas at Austin, Vrije Universiteit Amsterdam, Florida State University and the University of Southern California, to help us. At this point, it was necessary for me to start working on initial outputs as well as ensuring AIM’s activities gained visibility. To this end, we created a series of seminars and research conferences for our various audiences, plus new pedagogical modules for our students.

What disruptive trends are you observing around AI and its impact on higher education and work?

Our aim at the Business School is to prepare tomorrow’s managers and leaders to work in a technology-driven world. At the same time, it is also the responsibility of each manager – not just of the chief operating officer or chief technology officer – to ask themselves: ‘How can AI help me do my job more efficiently or differently?’

But to do this, managers need to be trained in these technologies, in design thinking methodologies, agility and so on. Companies need to invest in AI but also in their own people to get the most out of these technologies. This is why Emlyon includes courses on data, robotics and machine learning, and on the impact of these technologies on companies, in all its programmes.

It is important for us, as a Business School, to ensure our programmes are increasingly hybrid. However, AI is also transforming pedagogy itself. We are building new AI-augmented tools to support our students in their lifelong learning journey. Digital can help us personalise that experience.

Can you provide some background to the launch of AIM?

Over the past 20 years of working and investing in AI and related technologies, I have been involved in several different projects impacting various markets and sectors, from finance and agriculture, to transport and healthcare. 

This experience convinced me that AI is not only an economic opportunity, but also a social opportunity, because it can add value by putting humankind back at the heart of things. Researchers, engineers and product managers must be trained to become ever-more ethically responsible when they design, deploy or use emerging AI technologies. These principles are at the core of the AIM Institute. Our ambition is to understand the world in its complexity; build knowledge from it by taking an interdisciplinary approach, and disseminate this to various audiences in adapted formats, with the use of an omnichannel pedagogy. 

Why are there so few empirical studies looking at how AI will impact the workplace?

I believe the reason why there are many predictions about how AI will change business and the way we work, but relatively few empirical studies, is mostly due to companies’ late appropriation of recent AI-driven technologies which are still seen as not being mature enough. 

Most companies are still in the middle of their digital transformation and it is difficult for many to look ahead to the AI revolution. But it is coming, and it’s already affecting sectors such as healthcare and transport. Our first goal within the Institute is to work with companies on real-world problems and to support grounded, empirical studies of the way AI can create value around a broad range of business issues, as well as how this technology is changing what it means to work and the way work is organised, done and rewarded.

Can you talk us through the AIM Institute’s priorities of research, innovation and dissemination?

We aim to understand the opportunities and implications of AI for managing organisations, industries and business ecosystems. With this in mind, we have launched several series of seminars and workshops with leading scholars from around the world to address questions exploring the impact of AI on work and value creation, and organise monthly outreach lectures, open to the public, about the technologies behind AI in order to demystify and educate broadly.

On the pedagogical side, we have created an online certificate in AI and business for managers, new courses within our fields of expertise to be integrated into all of Emlyon’s programmes (at bachelor’s, master’s, MBA, and executive education levels), and post regular presentations on the School’s YouTube channel.

How complex is this type of implementation for Business Schools operating in a constantly changing and disrupted tech environment?

As in any other industry, in education we need to adapt constantly and cope with the latest technological breakthroughs. This requires a high level of agility around understanding technologies and being able to anticipate their impact, and this includes identifying the business and organisational issues that could emerge. Our approach is strongly interdisciplinary, so we address different variables across marketing, strategy, sociology and ethnography, alongside technology and ethics.

By building innovative pedagogical solutions based on digital and AI, we are questioning Emlyon’s mission as a School. All these new functionalities challenge the role of the professor. What can algorithms optimise and what should stay in the hands of the teacher? The question of how technology can be used to complement human skills also needs to be tackled in our domain of higher education.

How does your initiative work in practice and why is this a good example of how Business Schools and employers can work collaboratively to address issues such as AI?

On the research side, we have several studies under review by top academic journals and are working on new projects studying human-machine interaction; the impact of smart devices on the supply chain and operations; new business models derived from AI-augmented digital platforms, and how to design and create better user experiences through interactions with new technology.

These projects are interdisciplinary and address real business issues faced by organisations. Working closely with employers in an empirical way is a methodology we favour in order to anchor our actions in the real world. It means we can guarantee that we are relevant and impactful when disseminating this knowledge through pedagogy. We are also working on the creation of our technology transfer department. For every research project, we consider whether the work has the potential to contribute to our understanding of how organisations and institutions can take meaningful and responsible advantage of AI. For example, where we identify projects that have concrete business applications, we could develop patentable models that could be coded and used to develop an application that a partner organisation might find useful. Alternatively, we might explore the possibility of launching and supporting a startup to build on this innovation.

What are the implications of AI for labour markets, organisational design and governance and how can the AIM Institute make an impact here?

Thanks to embedded AI, robots are becoming more intelligent and can work safely alongside human workers. Machines will complement people in the workplace rather than competing with them, and this combination will speed up processes, make things easier for humans and enable people to add human value. 

For instance, in automotive factories 10 to 15 years ago, there were huge industrial robots operating behind security fences. But now the robots are becoming more intelligent and are being taken out of cages. Humans are back on the production line and are now operators of robots. From a business perspective, AI can help workers by automating dull, difficult, dangerous, or repetitive tasks.

In addition, AI-augmented systems, when combined with human operators, are always more efficient than human experts alone, or even machines alone. There is a healthcare study which shows that AI analysing a patient’s tumour will not perform as well as a human doctor. But if you combine the human doctor with an AI algorithm, the analysis is a lot more effective. 

AI can also be helpful in providing other diagnostic information that doctors can use to make better decisions about patient care. It won’t just be the healthcare sector that has to manage this balancing act, all areas will be affected.

Companies have no choice but to adapt and identify how they can use these technologies for their benefit, from both an economic and people perspective. Some jobs will disappear while new ones will be created. 

But rather than focusing on the numbers on each side, I think we need to understand how the whole structure of employment is being transformed by AI: most jobs won’t disappear, they will evolve. This is exactly what the AIM Institute is looking at: understanding how AI will transform the way organisations operate, how they are governed and how they recruit.

Your goal is to create and implement practical solutions from the research – what format will these take?

Everything starts with research. Through our research projects, we generate knowledge. This knowledge will be published in respected academic journals, but it is also the raw material with which we can develop our teaching. 

To do this, we will need to translate the research projects and findings into pedagogy, and this requires some engineering. When we talk about innovation within the AIM Institute, it is used first and foremost (but not only) from a pedagogical perspective. 

The technology-transfer mechanism, which is most often used in technical universities to build on their research, is something we want to implement. It might not always be possible, but our goal is for the team to consider each opportunity in turn, and in connection with our corporate partners as and where appropriate. 

What are the next steps?

We are now entering an acceleration phase and looking to expand globally – first into central and east Asia and Africa, where 

Emlyon Business School already has a strong presence, and then into India. We are also recruiting post-doctorates and assistant professors to open up new fields of knowledge around AI’s impact. 

We are also finalising online certificates and designing new courses for students. Last but not least, we are working on a new series of seminars, conferences and workshops for the coming academic year. It is an exciting time for us, working on a very exciting subject.

Renaud Champion is the Executive Director of the AI in Management (AIM) Institute and Director of Emerging Intelligences at Emlyon Business School, France. He is also Director of euRobotics AISBL, the European Association of Robotics. 

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Is diversity and inclusion an empty phrase?

Global trends in female representation and cultural diversity at board level, and the importance of diversity and inclusion policies, from Elena Philipova, Global Head of ESG at fintech data firm, Refinitiv.

Do you know this classic riddle? A father and son are involved in a car crash and are rushed to the hospital. The father dies, but the boy is taken to the operating room. The hospital bans surgeons from treating close relatives, so the doctor takes one look at the patient and says, ‘I can’t operate on this boy. He’s my son.’

How is this possible?

Those who have difficulty with this riddle are unable to imagine that the surgeon is a woman and, therefore, the boy’s mother.

A similar principle applies in the business world where some find it hard to imagine a woman as a company CEO, or a member of a cultural minority on a firm’s board of directors.

The varied picture on D&I

Developing a diverse workforce through policies of inclusion is no longer a theoretical concept. In today’s complex global marketplace, a company with a workforce that reflects the community in which it operates has a better chance of producing superior financial results – and rewarding investors.

Diversity and inclusion (D&I) is an issue which is often given lip service – but a deeper look at the data produces a varied picture.

More than 7,000 companies globally are ranked by the Refinitiv D&I Index, enabling it to identify the top 100 publicly traded companies with the most diverse and inclusive workplaces, as measured by 24 separate metrics across four key pillars. The data used to create the index is taken from the Refinitiv Environment, Social and Governance (ESG) database, from which recent analysis has highlighted some interesting D&I trends.

Trends in board-level gender and cultural diversity

For instance, the percentage of companies reporting on their boards’ gender diversity soared to 98% in 2017 from 60% in 2013, among companies that have had an ESG score for the last five years. However, these same companies seem to have a harder time reporting on their boards’ cultural diversity – the proportion doing this rose to 31% in 2017, from 21% in 2013.

When it comes to the actual level of diversity found on boards, it looks like many of those companies haven’t taken the necessary steps to create more balanced gender representation. Women held a disappointing 18% of board seats in public companies, up from 12% in 2013, while culturally diverse directors made up nearly 29%, roughly even with the figure of 30% from 2013.

Quotas may seem like a radical idea to many, but France has mandated that at least 40% of board members at companies in the CAC 40 stock index must be female since 2017. With quotas also in place in Germany and Italy, Europe was found to be leading the way, with 26% female board membership. The equivalent proportion in North America was 20%, while Japan placed bottom, with 5%.

 

Europe also led the charts for boards’ cultural diversity, at 35%, with Japan again bringing up the rear, at 12%. Switzerland was the top country for boards’ cultural diversity, at 56%, which is perhaps not surprising in a country with four official languages. The US ‘melting pot’ is among countries with the least culturally diverse company boards, at just 13%.

The business case for D&I and company-wide diversity

Drilling down into an organisation from the board level, it is critically important for companies to develop diverse talent from within and to invest in the future leaders of the business.

Companies that are serious about creating and benefiting from diverse and inclusive workplaces use information like the one powering the Refinitiv D&I Index to inform their strategies, measure progress and communicate with stakeholders – and the investment community is watching closely. The business case for D&I is compelling as more institutional investors use ESG metrics to enhance their investment strategies and inform their thematic solutions, such as the practice of ‘gender lens investing’.

Aside from the boardroom, many companies report on the diversity of their workforce as a whole. Here, we see an improvement in the gender balance, but at a much slower pace over the last five years. The percentage of female employees edged up to 35% in 2017, from 33% in 2013. The percentage of female managers, meanwhile stood at 27% in 2017, compared to 25% in 2013, although this proportion was substantially higher, at 35%, in 2016.

A diverse workforce also includes people with disabilities, a segment of the population that has frequently faced barriers to employment. Progress here has been promising, although a lot more could be done by businesses. The number of companies reporting on percentages of employees with disabilities is still very low, at 17% as of 2017, despite this being an increase from 9% in 2013.

So where are these trends going? Some 85% of companies in the ESG database have a D&I policy, but just 17% report D&I targets against this policy. Companies need to be committed to delivering against those policies and investors need to flag the companies that are following through with some real progress.

Management training and career development tracks

There are some promising trends around management training and policies for career development – crucial for attracting talent and maintaining a positive company culture. The percentage of companies with management training soared to 66% from 35%, and 78% of companies in the database now have career development tracks, up from 40%. Among geographic regions, Europe was the standout performer in both areas, with North America trailing.

In the future, D&I information will become an increasingly important indicator for investors as we are able to successfully overcome gender stereotypes illustrated in the riddle above. We need to push for greater transparency and standardisation on this information and other  metrics measured by ESG. That way, we will be better able to understand the linkages between diverse teams and sustainable financial growth, and make more informed investment decisions.

Elena Philipova is Global Head of ESG at Refinitiv. Learn more about the diversity and inclusion ratings created using Refinitiv ESG data.