First principles thinking with Dean Jacobs

I am 3 weeks away from finishing up my final quarter at graduate school. As I reflect on some interesting lessons and moments in the past 2 years, I was reminded of a conversation with former Dean Donald P Jacobs last year. Dean Jacobs, well into his eighties now, was the Dean at the Kellogg School of Management for 26 years between 1975 and 2001. Aside from the fact that the length of the tenure is notable, Dean Jacobs’ accomplishments in that time were nothing short of legendary.

Education is a sector where brands are sticky. There is a joke that Harvard was the top ranked school in Physics before Physics was even taught at Harvard. Reputation matters a lot and stays with you for a very long time. Dean Jacobs took over at Kellogg in 1975 when the school was decidedly a third tier business school. He retired with the school firmly considered in the top tier and consistently on top of the rankings. It is very rare to see a turnaround of that nature. As I was part of the team running the orientation for the incoming class, a teammate and I decided to speak with Dean Jacobs to understand the context and history of our school. Many of the stories he shared are covered in this Poetsandquants article. But, there’s one nugget that stood out to me.

In the 1970s, a lot of management education was delivered by former business leaders. It was a lot about the latest trends in business and was pretty tactical. The parts that were delivered by academic professors were, well, very academic. When Dean Jacobs asked – “What will management education look like in the next few decades?,” one of his key conclusions was that we would need to dig deeper into the first principles which governed business. To him, this meant taking a much more academic approach to management as learning about current trends in pricing was going to be obsolete in a couple of years. However, understanding how the economy works and how pricing fits in would be knowledge that would be evergreen. So, instead of hiring business folk, he focused entirely on hired freshly minted P.hDs in fields like Game Theory, Economics, etc., to teach at the school. While this was a game changing move, he ran into the known problem that these Professors didn’t know much about business. But, since he believed that we were moving toward an era of life-long education, he decided to build the first executive MBA program with funding from Booz Allen’s co-founder James Allen. This was a masterstroke for a few reasons. First, the executive MBA was an innovation that helped build the school’s nascent brand with executives around the world. Second, it was a great source of revenue. And, finally, it gave the Professors the opportunity to understand first-hand what was going on in business in exchange for giving executives a first principles academic perspective on business. In the exec MBA classrooms, the executives shared stories and real life case studies where the learning was applicable. All of this fed right back into the full time MBA program.

His investment in academics led to plenty of interesting new research at the school. Key among the new wave of research was a recurring conclusion that business education needed more emphasis on working in teams. His decision to invest heavily in building a culture where students worked well in teams went on to define the culture of the school and served as a competitive advantage in the late 80s and 90s.

There’s plenty more that can be written about the innovations that Dean Jacobs led. For me, however, the interesting part is that it comes down to that first principles question that can be applied to anything we do – “What drives this and how is that going to change in the next few decades?”

Everything we do is a product of the questions we ask.

Dean Jacobs(Dean Jacobs greeting Dean Sally Blount who took over in 2009)