The Golden Passport

by Duff McDonald

  The most common critique of The Firm was confusing to me. It was that I posed a question—Is McKinsey (and by extension, all of management consulting) worth the price paid?—and then failed to deliver a satisfactory answer. Those critics wanted a Yes or a No, to which I can only respond that if the question were that simple, it would not have required a book to address it. But I can understand why “It depends” might not be satisfying for some. Perhaps I was too even-handed, presenting both the pros and the cons of management consulting and leaving the reader to come to their own conclusion.

  When I started The Golden Passport, my objective was to tell the story of an enduring institution and its position at the front of the juggernaut that is the MBA. The path I took to HBS myself had gone through McKinsey, as I had stumbled upon the deep connections between HBS and McKinsey when researching The Firm, and wrote about it in a section of that book called “McHarvard.” The pitch to my publisher was that I would do for HBS what I had done for McKinsey. I had no axe to grind.

  I certainly wasn’t anti–business school. I attended one myself, the undergraduate program at the Wharton School of the University of Pennsylvania. Am I anti-wealth? I am not. While money has never been a primary motivator for me, when it comes to other people’s values, I’m laissez-faire to the core—to each his own. Nor have I ever felt that democratic capitalism is so rotten that we should burn the whole edifice to the ground. It can obviously be improved, but so can everything that humans engage in. I was even, for a brief moment, a contributing editor at Fortune magazine, the capitalist’s bible.

  But it didn’t take long for me to realize that I was going to hold HBS to a higher standard than I did McKinsey. That’s because it’s an educational institution—we entrust them with the minds of our youth—and therefore has more responsibilities to the rest of us. With its bold mission, rich resources, and global footprint, what business school was better positioned than HBS to help shape and improve the state of business and how it is practiced in the United States and beyond over the past century?

  This question motivated my inquiry into HBS’s century-long dominance. As with my previous two books, I began by asking the subject whether they would be interested in being involved, whether that was making administrators and faculty available for interviews or providing access to the School’s extensive historical collection. Back in 2008, Jamie Dimon did so almost immediately, despite the challenges of running one of the world’s largest banks in the midst of a financial and public relations maelstrom. McKinsey took a little longer to come around, but they eventually did so, too. But HBS told me that they had absolutely zero interest in engaging with me, and that it would not make a single person at the School available for a single interview, from the dean on down. They did offer to make historical material available to me on an ad hoc basis, except for any material from the past fifty years. But that was offering me something that I could get myself, thanks to the Internet and to a number of people who have approached this subject from different angles in the past century.

  HBS is part of a taxpayer-supported institution, and, as part of Harvard itself, is supposedly dedicated to the pursuit of truth. I had barely considered the possibility that they would shut me out entirely. But they did. I asked on a handful of occasions if they’d changed their mind, and when I went back to them one final time in the spring of 2016, to see if the dean might have time for a quick interview on some of the broad themes in this book, they declined again.

  Their decision was, in a word, liberating. If I had any concerns about my previous two books, it was about the price of access. While I have always endeavored to do my job conscientiously, I am well aware that the mere act of providing conditional access does change the nature of the reportorial equation. But without that access, both The Firm and Last Man Standing would have been lesser books. After all, I was writing about people and companies that had no obligation to speak to me—or to anyone—and without those hundreds of conversations, the books would have been bereft of much of their behind-the-scenes appeal. That’s not to say that with the benefit of hindsight, there aren’t things I wish I had written differently in each. There most certainly are. But I don’t regret for a second the approach I took to writing them.

  When HBS told me to go fly a kite, though, they weren’t able to cut me off in nearly the same way as the others might have done. There is too much information already available about the School, including a cottage industry of authors recounting their experiences attending HBS, and in a few cases, teaching and working at HBS. Many people who don’t work at HBS—executives, faculty at other MBA institutions, alumni—were willing to talk about it and its influence. A number of the most prominent HBS-credentialed CEOs in the world did agree to talk to me, and I’m grateful for that, even in those cases where the results of those conversations didn’t make the final edit. In the end, the only people who weren’t willing to discuss the hugely important job that HBS is engaged in were those employed by HBS itself.

  HBS may have offered me no assistance, but thankfully many others did.

  First, I would like to thank Hollis Heimbouch and everyone else at Harper Business. Thanks for putting your faith in me, Hollis. You’re the best.

  Second, my agent, David Kuhn, and the rest of the folks at Kuhn Projects. We’re approaching a decade together, David, and you have my eternal gratitude for prodding me into this phase of my career.

  Third, and crucially, the long list of people who both shared their thoughts and gave me their time during the researching of the book. Anyone who is quoted herein has my gratitude, but I need to single out a few, including J. C. Spender, Henry Mintzberg, Casey Gerald, Walter Kiechel, Kevin Mellyn, Miriam Datskovsky, and Ralph Nader. As usual, for anyone I spoke to, I hope the results seem worth the time spent.

  Fourth, the people who kept me sane over the past few years when things could just as easily have gone the other way: Luke Froude, Pablo Galarza, Adam Masry, Gilda Riccardi, Lauren Wells, Tara McIndoo, and Laura Jones. Separately, I would like to address a very special thanks to J. P. Vicente.

  Finally, I’d like to thank my family for being there for me. I want to relate two anecdotes about them.

  The first involves my brother Steve, who was visiting me right before I was going to buckle down and turn my research into a book. After listening to a particularly passionate soliloquy about Elton Mayo, he looked at me and said, “You really should try to write less like you currently write and more like you speak.” It sounded right to me, and so that’s what I did. Thanks, Steve.

  The second involves my daughter Marguerite. One night while drifting off to sleep, she said, a propos of nothing, “I can’t believe I have a dad who’s an author.” I’d describe my reaction as one half weird fatherly pride (it’s not that hard to impress a six-year-old), and the other half skepticism about her grasp of what being an author even entailed. But she wasn’t finished, adding, “and I can’t believe I have a dog.”

  New York, November 2016

  Notes

  Introduction

  1http://poetsandquants.com/2014/06/22/the-most-stirring-speech-ever-given-by-an-mba/.

  2Harvard University Archives, Harvard University Report of the President of Harvard College and reports of departments, 1930–31.

  3“Natural Capital at Risk: The Top 100 Externalities of Business,” Trucost, April 2013.

  4Leslie Sklair, The Transnational Capitalist Class (Oxford, U.K.: Wiley-Blackwell, 2000).

  Chapter 1: The Experimenters: Charles Eliot & Abbott Lawrence Lowell

  1Philip T. Crotty Jr., “Professional Education for Experienced Managers: A Comparison of the MBA and Executive Development Programs,” 1970 p. 12.

  2David W. Ewing, Inside the Harvard Business School (New York: Crown, 1990), p. 268.

  3https://www.marxists.org/reference/archive/de-tocqueville/democracy-america/ch29.htm.

  4Rakesh Khurana, From Higher Aims to Hired Hands: The Social Transformation of American Business S
chools and the Unfulfilled Promise of Management as a Profession (Princeton, NJ: Princeton University Press, 2010), p. 88.

  5J.-C. Spender and Jim Walsh, “Underlying Antinomies and Perpetuated Problems: An Historical View of the Challenges Confronting Business Schools Today,” Fortune no. 55 (January 1950): 14867–78.

  6Address of Edmund J. James, Professor of Public Finances and Administration, Wharton School of Finance and Economy, University of Pennsylvania, before the Convention of American Bankers Association, Saratoga, NY, September 3, 1890.

  7Robert D. Putnam, Bowling Alone: The Collapse and Revival of American Community (New York: Touchstone Books, 2001), p. 368.

  8Ibid., p. 370.

  9Hayes, diary entry, March 11, 1888.

  10Alfred D. Chandler Jr., Scale and Scope: The Dynamics of Industrial Capitalism (Cambridge, MA: Belknap Press of Harvard University Press, 1994), p. 1.

  11Crotty, “Professional Education for Experienced Managers,” p. 13.

  12Ibid.

  13Matthew Stewart, The Management Myth: Why the Experts Keep Getting It Wrong (New York: Norton, 2009), p. 19.

  14Khurana, From Higher Aims to Hired Hands, p. 112.

  15Crotty, “Professional Education for Experienced Managers,” p. 16.

  16Jeffrey L. Cruikshank, A Delicate Experiment: The Harvard Business School 1908–1945 (Boston: Harvard Business Review Press, 1987), p. 39.

  17Ibid., p. 23

  18Khurana, From Higher Aims to Hired Hands, p. 112.

  19http://www.hbs.edu/competitiveness/about/Pages/default.aspx.

  20Crotty, “Professional Education for Experienced Managers,” p. 12.

  21Michel Anteby, “The Ideology of Silence at the Harvard Business School: Structuring Faculty’s Teaching Tasks for Moral Relativism,” Research in Sociology of Organizations, forthcoming.

  22Marion Fourcade, “Theories of Markets and Theories of Society,” American Behavioral Scientist 50, no. 8 (April 1, 2007): 1015–34, doi:10.1177/0002764207299351.

  23BBC4, February 16, 2015.

  24Melvin Thomas Copeland, And Mark an Era: The Story of the Harvard Business School (Boston: Little, Brown, 1958), p. vii.

  25Stuart Crainer and Des Dearlove, Gravy Training: Inside the Business of Business Schools (San Francisco: Jossey-Bass, 1999).

  Chapter 2: A Search for Mission and Method: Edwin Gay

  1Herbert Heaton, A Scholar in Action, Edwin F. Gay (New York: Greenwood Press, 1968), p. 38.

  2Jeffrey L. Cruikshank, A Delicate Experiment: The Harvard Business School 1908–1945 (Boston: Harvard Business Review Press, 1987), p. 29.

  3Michel Anteby, Manufacturing Morals: The Values of Silence in Business School Education (Chicago: University of Chicago Press, 2013), p. 11.

  4Quoted in James T. Patterson, America in the Twentieth Century: A History, 2nd ed. (New York: Harcourt Brace Jovanovich, 1983), p. 33.

  5Michel Anteby, “The Ideology of Silence at the Harvard Business School: Structuring Faculty’s Teaching Tasks for Moral Relativism,” Research in Sociology of Organizations, forthcoming.

  6Robert D. Putnam, Bowling Alone: The Collapse and Revival of American Community (New York: Touchstone Books, 2001), p. 370.

  7Ibid. p. 370.

  8Rakesh Khurana, From Higher Aims to Hired Hands: The Social Transformation of American Business Schools and the Unfulfilled Promise of Management as a Profession (Princeton, NJ: Princeton University Press, 2010), p. 121.

  9Melvin Thomas Copeland, And Mark an Era: The Story of the Harvard Business School (Boston: Little, Brown, 1958), p. 17.

  10Wallace B. Donham, “The Social Significance of Business,” Harvard Business Review 5 (July 1927): 406–15.

  11http://www.bizedmagazine.com/archives/2016/2/features/how-management-education-past-shapes-present.

  12J.-C. Spender and Jim Walsh. “Underlying Antinomies and Perpetuated Problems: An Historical View of the Challenges Confronting Business Schools Today,” Fortune 55 (January 1950): 14867–78.

  13Cruikshank, A Delicate Experiment, p. 55.

  14Stanley Teele, “Harvard Spotlights 50 Years of Business,” Christian Science Monitor, September 1958.

  Chapter 3: The “Scientist”: Frederick W. Taylor

  1Matthew Stewart, The Management Myth: Why the Experts Keep Getting It Wrong (New York: Norton, 2009), p. 27.

  2Ibid., p. 30.

  3James Hoopes, False Prophets (New York: Basic Books, 2007), p. 29.

  4Ibid.

  5Ibid.

  6Christopher D. McKenna, The World’s Newest Profession: Management Consulting in the Twentieth Century (Cambridge, U.K.: Cambridge University Press, 2010), p. 55.

  7J.-C. Spender and Jim Walsh, “Underlying Antinomies and Perpetuated Problems: An Historical View of the Challenges Confronting Business Schools Today,” Fortune 55 (January 1950): 14867–78.

  8Stewart, The Management Myth, p. 48.

  9Ibid., p. 51.

  10Ibid., p. 54.

  11Hoopes, False Prophets, p. 34.

  12Walter Kiechel, “The Management Century,” Harvard Business Review, November 2012.

  13Ibid.

  14McKenna, The World’s Newest Profession, p. 59.

  15Judith A. Merkle, Management and Ideology: The Legacy of the International Scientific Management Movement (Berkeley: University of California Press, 1980), p. 132.

  16Kiechel, “The Management Century.”

  17Hoopes, False Prophets, p. 58.

  18John Micklethwait and Adrian Wooldridge, The Company: A Short History of a Revolutionary Idea (New York: Modern Library, 2005), p. 65.

  19John Dos Passos, U.S.A.: The 42nd Parallel/1919/The Big Money (New York: Library of America, 1996), p. 809.

  20Thomas Frank, One Market Under God: Extreme Capitalism, Market Populism and the End of Economic Democracy (New York: Doubleday, 2000), p. 181.

  21Rakesh Khurana, From Higher Aims to Hired Hands: The Social Transformation of American Business Schools and the Unfulfilled Promise of Management as a Profession (Princeton, NJ: Princeton University Press, 2010), p. 92.

  22Ibid., p. 93.

  23Stewart, The Management Myth, p. 74.

  24McKenna, The World’s Newest Profession, p. 56.

  25Dos Passos, U.S.A., p. 787.

  Chapter 4: The First Decade: 1910–1919

  1Herbert Heaton, A Scholar in Action, Edwin F. Gay (New York: Greenwood Press, 1968), p. 83.

  2Jeffrey L. Cruikshank, A Delicate Experiment: The Harvard Business School 1908–1945 (Boston: Harvard Business Review Press, 1987), p. 87.

  3Ibid., p. 72.

  4Charles F. O’Connell, “The Corps of Engineers and the Rise of Modern Management, 1827–1856,” in Military Enterprise and Technological Change, ed. Merritt Roe Smith (Cambridge, MA: 1984), p. 114.

  Chapter 5: The Case for the Case Method

  1Jeffrey L. Cruikshank, A Delicate Experiment: The Harvard Business School 1908–1945 (Boston: Harvard Business Review Press, 1987), p. 71.

  2Melvin Thomas Copeland, And Mark an Era: The Story of the Harvard Business School (Boston: Little, Brown, 1958), p. 47.

  3J.-C. Spender and Rakesh Khurana, “Intellectual Signatures,” in Disrupt or Be Disrupted: A Blueprint for Change in Management Education (San Francisco: Jossey-Bass, 2013), p. 140.

  4Associates of the Harvard Business School, The Success of a Strategy: An Assessment of Harvard University Graduate School of Business Administration ([Boston]: [Harvard University, Graduate School of Business Administration], 1979), p. 27.

  5William Deresiewicz, Excellent Sheep: The Miseducation of the American Elite and the Way to a Meaningful Life (New York: Free Press, 2015), p. 63.

  6James Berkley and Nitin Nohria, “Whatever Happened to the Take-Charge Manager?,” Harvard Business Review, January 1994.

  7David W. Ewing, Inside the Harvard Business School (New York: Crown, 1990), p. 272.

  8Edmund James, Education of Business Men (New York: American Banker’s Association, 1892), p. 10.

  9Peter Cohe
n, The Gospel According to the Harvard Business School (Harmondsworth, U.K.: Penguin Books, 1974), p. 59.

  10Cruikshank, A Delicate Experiment, p. 76.

  Chapter 6: The Idealist: Wallace Brett Donham

  1Jeffrey L. Cruikshank, A Delicate Experiment: The Harvard Business School 1908–1945 (Boston: Harvard Business Review Press, 1987), p. 94.

  2Adolf A. Berle and Gardiner C. Means, The Modern Corporation and Private Property (New York: Harcourt, Brace & World, 1967), p. 46.

  3Ida Minerva Tarbell, All in the Day’s Work: An Autobiography (Urbana: University of Illinois Press, 1939), p. 82.

  4Robert D. Putnam, Bowling Alone: The Collapse and Revival of American Community (New York: Touchstone Books, 2001), p. 399.

  5Thomas Frank, One Market Under God: Extreme Capitalism, Market Populism and the End of Economic Democracy (New York: Doubleday, 2000), p. 23.

  6Walter Lippmann, Drift and Mastery: An Attempt to Diagnose the Current Unrest (New York: Mitchell Kennerley, 1914), p. 153.

  7J.-C. Spender and Jim Walsh, “Underlying Antinomies and Perpetuated Problems: An Historical View of the Challenges Confronting Business Schools Today,” Fortune 55 (January 1950): 14867–78.

  8Ibid.

  9Rakesh Khurana, From Higher Aims to Hired Hands: The Social Transformation of American Business Schools and the Unfulfilled Promise of Management as a Profession (Princeton, NJ: Princeton University Press, 2010), p. 150.

  10Wallace B. Donham, “The Social Significance of Business.” Harvard Business Review 5, no 4 (1927): 406–19.

  11Wallace Donham, letter to the president of Harvard, 1919–20. Reports of the President and Treasurer of Harvard College, 1919–20, p. 114.

  12John Micklethwait and Adrian Wooldridge, The Company: A Short History of a Revolutionary Idea (New York: Modern Library, 2005), p. 103.

  13Ibid., p. 107

  14Melvin Thomas Copeland, And Mark an Era: The Story of the Harvard Business School (Boston: Little, Brown, 1958), p. 176.

  15Marion Fourcade and Rakesh Khurana, “From Social Control to Financial Economics: The Linked Ecologies of Economics and Business in Twentieth Century America,” published online February 27, 2013, http://www.hbs.edu/faculty/Publication%20Files/11-071_065a37bf-f945-4043-8f8e-a466483ce557.pdf.