Underlying the practice and study of business is the belief that management is a science and that business decisions must be driven by rigorous analysis of data. The explosion of big data has reinforced this idea. In a recent EY survey, 81% of executives said they believed that “data should be at the heart of all decision-making,” leading EY to enthusiastically proclaim that “big data can eliminate reliance on ‘gut feel’ decision-making.”
Managers find this notion appealing. Many have a background in applied sciences. Even if they don’t, chances are, they have an MBA—a degree that originated in the early 20th century, when Frederick Winslow Taylor was introducing “scientific management.”
MBA programs now flood the business world with graduates—more than 150,000 a year in the United States alone. These programs have been trying to turn management into a hard science for most of the past six decades. In large measure this effort began in response to scathing reports on the state of business education in America issued by the Ford and Carnegie Foundations in 1959. In the view of the report writers—all economists—business programs were filled with underqualified students whose professors resisted the methodological rigor of the hard sciences, which other social sciences had embraced. In short, business education wasn’t scientific enough. It was in part to remedy this shortcoming that the Ford Foundation supported the creation of academic journals and funded the establishment of doctoral programs at Harvard Business School, the Carnegie Institute of Technology (the predecessor of Carnegie Mellon), Columbia, and the University of Chicago.
But is it true that management is a science? And is it right to equate intellectual rigor with data analysis? If the answers to those questions are no and no—as we will suggest in the following pages—then how should managers arrive at their decisions? We’ll set out an alternative approach for strategy making and innovation—one that relies less on data analysis and more on imagination, experimentation, and communication.
But first let’s take a look back at where—or rather with whom—science started.
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