Fired up by some stinging criticism from a former student, Joel M. Podolny once at HBS and Yale, shows admirable contrition for the failure of MBA programs to equip executives and their consultant advisors to run firms well. In The Buck Stops (and Starts) at Business School he vents the anger on this he shares with those outside business schools, and blames the carving up of management challenges by function that leaves academics without a holistic appreciation of things. He says “I’m angry that many academics aren’t curious about what really goes on inside companies. They prefer to develop theoretical models that obscure rather than clarify the way organizations work. Many believe a theory’s relevance is enough to justify teaching it. That’s a low bar; almost no theory is entirely irrelevant to business, but only a few are truly important.”
He is being too kind – not even relevance is needed. The subject that should above all others show how organizations work – breaking across all those silos – is strategy, but the resource-based view [RBV] that has dominated strategy ‘research’ for 20 years is of no practical value. Beyond the trivial observation that it is good to have resources and capabilities competitors can’t easily copy, RBV goes off into arcane and abstract theorising that is of no actual use. So executives and MBAs are mostly still being taught with static tools that do little more than help choose a strategic ‘position’ – important, but a very small part of competent strategic management.
I have no problem being shown to be wrong on this. It’s no fun trying to justify working in a field that has failed so badly. So it would be great to see some detailed examples of RBV – as defined in the strategy academy – being really used. What was the situation, what RBV analysis was done on what data, leading to what choices and decisions, adapted in what way as conditions changed , to deliver strong and sustainable performance? It would be even better if anyone can show how RBV helped an organization anticipate the recent crisis and protect itself against harm. Please anyone, if it’s out there, tell us.