“When circumstances change, doing the same thing is a bad strategy.” It is with these words that Johan Roos, professor of strategy, managing director and dean of the Jönköping Business School in Sweden, opens the conversation on the future of business education.

And circumstances have changed indeed. In the wake of the Enron and financial crises, business schools are no longer shielded from the consequences of actions taken by executives they have trained— the number of MBAs from top business schools going into finance dropped by nearly one-third between 2007 and 2013, for example. Much like other sectors of education, business schools are also struggling to keep pace with rapid technological developments—from connectivity to artificial intelligence—that are transforming both the economy and the way we learn.

This makes their reform unavoidable.

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One crucial area will be science education. “The tremendous developments in science, engineering and technology are overwhelming. Business schools need to be helping the STEM engineers with management, but we also need to ensure business students know about the possibilities of STEM.” says Mr Roos, whose new master’s programme in engineering management is now the most popular degree.

Improving the links between the two sectors is crucial: as of 2015, less than 15% of all MBA graduates went into technology jobs. Such improvement could also lead to more innovation. Schools like the Jacobs Technion-Cornell Institute, for example, have set up challenges and start-up projects where MBAs collaborate with master students in science, media and technology as part of their respective curricula. At graduation, the best start-ups get $40k of investment capital and one year of free office space.

Another important task for business schools will be to train a new generation of more-responsible executives. This not only important for the schools’ reputations, which have suffered from the fallout of the financial crisis and the recent banking scandals, it is also key if we are to address issues like sustainability—closing and greening the infrastructure investment gap cannot be done without private sector involvement, for example.

The good news is that better leaders often engender better results. A quantitative analysis of 84 US companies by KRW International, for example, showed that companies with CEOs displaying integrity, responsibility and forgiveness had a return on assets five times greater than those that did not. Correlation is not causation, of course, and researchers are now extending the analysis to firms in Latin America and Europe to test if the results hold, but the idea is compelling. “Business schools are in the business of providing their students with the tool kits for creating value. What they have totally overlooked is that the character dimension of a person either magnifies or undermines the effectiveness of those skills,” notes Fred Kiel, co-founder of KRW international.

Last but not least, schools will have to move from a one-size-fits-all education model based on theory to one that is individualised and based on experience. This is, in part, a reaction to the previous wave of reform, started in 1959, that pushed business education towards theory—and, many would argue, too far from practice. It is also attributable to progress in connectivity, which is making that theory available from anywhere. Alon Rozen, executive dean of the business school of Ecole des Ponts in France, envisages a future of specialised master’s degrees where students would work only on self-directed projects, learning on the go and as needed the skills required to successfully meet the challenges they are and will be facing, for example.

The challenge, of course, is to ensure that the skill-set each student develops is at an adequate level of mastery. Mr Rozen, who aims to start a master’s programme of this kind by 2017, believes that one solution lies in choosing projects that require a certain set of competencies to complete them—this competence angle, in turn, would also make getting accreditation for the programme easier.

Business education, it seems, is on the verge of restructuring. This is not the first time—two major reforms have happened already—and it won’t be the last. But with rapid technological developments affecting both the economy and education, change will have to come quickly if business education wants to remain relevant.

This article is published in collaboration with GE Lookahead. Publication does not imply endorsement of views by the World Economic Forum.

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Author: Dr. Elie Chachoua is an expert in strategic and multidisciplinary research.

Image: Pedestrians walk through campus. REUTERS/Beck Diefenbach.