Case study. what companies want

Case study

July 2010

”What Companies Want “

Graduate education needs in a global labour market

BIANCHI Paolo ANDERSEN Solveig

GAGLIARDI Marcello GUERIN Julia

VLEUGELS Jenneth

CASE STUDY LBS, JULY 2010 1

TABLE OF CONTENTS

1. INTRODUCTION AND PROBLEM DEFINITION 2

2. EXTERNAL ENVIRONMENT 3

2.1 Economic developments 3

2.2 Globalization 4

2.3 Entrepreneurial thinking 4

2.4 Corporate social responsibility 5

2.5 Demography 5

3. STORY OF LUISS BUSINESS SCHOOL 6

3.1 LUISS Guido Carli University and LBS: history in brief 6

3.2 Business areas and offers 7

4. STRATEGY OF LUISS BUSINESS SCHOOL 7

4.1 Three strategic pillars 7

4.2 Positioning of Luiss Business School´s educational model 8

4.3 Competitive advantage 9

4.4 Directions for improvement 10

5. HOW TO CONTINUE? 10

REFERENCES 11

APPENDIX 1: INTERVIEW SUMMARIES 12

Mr. B. - Fabrica Immobiliare SGR 12

Mr. V - Director of Operations and Development - Gruppo Della Valle 16

Mr. D - TL Com 21

APPENDIX 2: STRUCTURE OF THE PRESENT MBA PROGRAM 25


1. INTRODUCTION AND PROBLEM DEFINITION

Mr. Paolo Boccardelli, Head of the International Division at Luiss Business School1, and Luca

Giustiniano, coordinator of the MBA program at LBS, have a conversation about the strategy of LBS.

Mr. Boccardelli is concerned about the future and expresses his ideas to Mr. Giustiniano: “After the

economic crisis the world is changed, and now we can see how important it is for companies to be

flexible and to adapt. Therefore, we have to understand companies’ new needs, caused by such

changes, as companies are our customers.”

Mr. Giustiniano nods to show his consent and adds to Mr. Boccardelli’s concerns: “I completely agree

with you, Paolo. We must find out what new competencies are required from present and future

managers, the ones we train here. Other external factors, besides the economic crisis, might influence

the competencies they should develop now as well”.

Mr. Boccardelli’s sighs as a sign of how complex the whole situation is. He continues: “Yes, that’s

true, I keep in mind factors like the different demographic trends in the world, the globalization and

the increased requirements from stakeholders, who put pressure on the companies to behave in a

socially responsible way”.

By the end of their conversation, Mr. Boccardelli and Mr. Giustiniano agree that LBS needs to

understand “what companies want”. Likewise, it is important that LBS adapts to the external

changing environment. As companies are LBS’ customers, it is crucial that LBS meets the new

requirements from its customers. Therefore, Mr. Boccardelli and Mr. Giustiniano agree that the

problem LBS is facing, can be defined as follows:

“What are the companies’ needs, influenced by the global changing environment, in terms of present

and future managerial competencies?”

After having defined the problem, Mr. Boccardelli and Mr. Giustiniano look for the next step to solve

the problem. They quickly reach the conclusion that after such new competencies will be identified, a

reshaping of the MBA program may well be necessary. The main goal of their efforts is to increase

the satisfaction of the companies, they train managers for, as well as the quality of the tuition they

provide at LBS. A new MBA program, or a reorganization of the existing one, is likely to be the

practical result of the analysis Mr. Boccardelli and Mr. Giustiniano started.

1 Hereinafter: LBS


They know from the literature concerning managerial competencies that several definitions and

meanings of the word “competency” exist, so they decide to clarify the meaning of the word for their

purpose. They perceive a competency as an individual’s readiness to use knowledge, skills and

attitudes. They decide to discard the meaning of competency as the strategic core competencies an

organization uses in order to gain competitive advantage. They distinguish between skills and

competencies as well. A skill is the ability to carry out a specific task, whereas a competency is the

ability to use a combination of different skills.

2. EXTERNAL ENVIRONMENT

Providing a first insight into the global environment surrounding LBS, Mr. Giustiniano and Mr.

Boccardelli refer to some literature. The following paragraph will provide a summary.

2.1 Economic developments

“The global economic crisis, which severely tested our adaptability

and flexibility this past year, will be truly transformational in its

impact. Many accepted paradigms, including the way in which

business interacts with its stakeholders, particularly governments, will

have to be rewritten. The turbulence of the last months will

significantly accelerate the development of business models that

capitalize on the new opportunities created by the crisis, including the

expansion of the so-called green economy”

(Schwab, 2009, p.2).

The important economic development besides the economic crisis that is not captured by this quote

is the following: according to Goldman Sachs, Brazil, Russia, India and China will definitely overrun

the G-6 economies by 2043, therefore the future will be multi-polar, which means that there will be

more dominant economic centers than in the past2.

Besides these shifts in economic dominance most markets will experience pressures regarding

pricing. The weakness of the economy, leading to overcapacity within companies and a shift in

mentality from superiority to soberness and modesty, has already pushed prices downward. This

trend will be intensified by the expansion of companies into poorer markets all over the world.

2 Goldman Sachs (2003)


Meanwhile, a great debate is taking place concerning the behavior of managers, who were in charge

of leading large financial institutions, and whose behavior were not aligned with the public opinion.

In addition to this, the whole category of top managers is nowadays accused of being greedy and

more interested in stock options than in the common good3. Furthermore, pragmatically speaking,

the dominance of the government will be more prevalent in the future. Because the current crisis has

demonstrated that markets do not automatically control systemic risk or automatically create

competition, governmental intervention will be required to prevent markets from destroying

themselves4.

2.2 Globalization

One of the most significant changes in the world economy over the past two decades has been an

increasing globalization of markets and industries5. The ongoing consequences of globalization

include widespread industry rationalization and heightened competition at regional, national, and

global levels6. Besides this, the number of cross-border mergers and acquisitions and the number of

multinational firms has increased extensively7.

Furthermore, as an influence of globalization, the cultural diversity in society and business has grown

considerably8. Because of the fact that organizations are becoming more multicultural, effective

management of a multicultural team is gaining in importance and is crucial to maximizing the

productivity and input of each member9.

2.3 Entrepreneurial thinking

Changes in the environment, such as the increased dynamics of the market, the speed of changes

and increased turbulence, have a major impact on the way managers should act and think.

Therefore, entrepreneurial thinking becomes more and more important. With regard to this, in order

to survive, companies must change their focus on linkages between technology and management to

enhance the capability to produce entrepreneurial strategies and innovative business models10.

3 Ghemawat (2010)

4 Watts (2009)

5 Wiersema & Bowen (2008)

6 OECD, Organization for Economic Co-Operation and Development (2003)

7 UNCTAD, United Nations Conference on Trade and Development (various years)

8 Source: Mr. Boccardelli, iMBA director, LBS

9 Day. (2008)

10 Source: Mr. Boccardelli, iMBA director LBS


2.4 Corporate social responsibility

Concerns about corporate social responsibility have grown significantly during the last two decades11.

What is important regarding CSR is the mindset of the manager, because managerial perceptions are

of crucial importance for the company’s CSR strategy. This involves the idea that a right

interpretation of the environment and the requirements from stakeholders can lead to success and

improved performance, while a wrong interpretation can lead to performance deterioration and

crisis12.

2.5 Demography

The statistics are undeniable: in most developed economies, the workforce is steadily ageing, as a

reflection of declining birth rates and the graying of the baby boom generation. The percentage of

the workforce between the age of 55-64 is growing faster than any other age group. Even in an

emerging economy like China, the number of manufacturing workers aged 50 or older will more than

double in the next 15 years 13.

This will have several implications for organizations. First, as older individuals tend to have lower

rates of labour force participation, this shift is likely to result in lower overall participation rates and a

contraction of labour supply14. Second, as employees get older, and retire, businesses can face

significant losses of critical knowledge and skills. The shortage of labour supply will increase this

problem, because older talents cannot be substituted by younger ones15. Third, there is a strong

debate surrounding the effect of aging on productivity. A key finding on aging and productivity is that

individual performances at work strongly depend on the content, organization and environment of

the work itself. This emphasizes the responsibility of the organization to deal with the ageing

workforce16.

11 Campbell (2007)

12 Maon, Lindgreen & Swaen (2008)

13 Strack, Baier & Fahlander (2008)

14 Spieza (2002)

15 Dychtwald, Morison & Erickson (2006)

16 Spieza (2002)


3. STORY OF LBS

In order to discover “what companies want” and to define the necessary intervention on the MBA

program, Mr. Boccardelli and Mr. Giustiniano hire an external consulting firm. To inform the

consultants about what is going on at LBS, they give them a short overview of the history, business

areas and offers at LBS.

3.1 LUISS Guido Carli University and LBS: history in brief

LUISS stands for “Libera Università Internazionale degli Studi Sociali” that is “Private International

University for Social Studies”. LUISS Guido Carli University is an independent university, established

by a consortium of private and public companies over the years 1974-1978, and traces its origins

back to a pre-existing institution, Università Pro Deo, founded in 1966. The university consists of

three faculties: Economics, Law and Political Science.

In 1974 Umberto Agnelli, member of the well-know Agnelli family, which is the owner and founder of

the Italian automotive company FIAT, led a group of businessmen in a project of higher education,

investing human and financial resources in the education and training of the managers. Important

banks, along with industrial groups belonging to both the private and the public sector, joined the

project. In 1978 the chairman of the Italian Confederation of Industry (Confindustria), Guido Carli,

was appointed as President of the University. He covered this position until his death in 1993.

Presently the President is Luca Cordero di Montezemolo, former chairman of Confindustria as well.

The milestones in the history of LUISS Guido Carli University are the following:

- In 1982 the faculty of law was founded and the campus expanded;

- In 1986 the foundations of LBS were made. It was a “managerial education area” (Area

Formazione Manageriale) within the LUISS Guido Carli University; recently it officially became

an autonomous department established under the name: LBS;

- In 1994 the Board of Directors decided to name the university after the death of Guido Carli.

- In 1997 the University set up Luiss Management S.p.A., the company which manages the

business school in order to cater for market-oriented education.

- In 2010 the Luiss School of Government was created.


3.2 Business areas and offers

LBS is involved in five business areas. First of all, the managerial education department is devoted to

middle-managers education. The offer is strongly focused on the Italian market, and proposes varied

disciplines such as marketing, communication, HR, etc. This is the traditional and main business for

LBS, which represents 40 % of its revenues.

Then, the International department’s objective is to enhance the ability for LBS MBA to compete with

other MBAs within Europe. Here are examples of specific programs handled by the international

department: classic MBAs, aviation industry MBA and a master in corporate finance. Further, there is

the recently established international MBA which focuses on the global demand.

The public sector management department focuses on training managers in the public sector, both

at central and local levels (example: management in healthcare).

The Executive education department activities concentrate on the Executive MBA.

Lastly, there is a consulting department, which represents a very small proportion of LBS activities. It

provides consulting and research services to private and public institutions, in cooperation with

professors and researchers of LUISS University and with prominent consulting firms as well.

4. STRATEGY OF LBS

In order to provide a better understanding of LBS and its heading, Mr. Giustiniano and Mr.

Boccardelli give to the external consultants an overview of the strategy of LBS.

Since the founding of LBS in 1986, the mission of LBS is to design and offer managerial education

solutions both to recently graduated students and professionals, looking for people who want to

leverage their talent and consequently further their careers, aiming at positions in big corporations,

medium sized companies or the public sector as well.

4.1 Three strategic pillars

As Head of International Department Paolo Boccardelli expresses, the fact that the strategy of LBS is

based on three pillars:

1) Innovation


The objective is to provide training and education to organizations and companies so as to help them

developing innovation. Because of the fact that they are not so up to date in new technologies, it is

crucial for Italian companies to foster this innovation dimension in order to be competitive at a

national or global level. In order to provide high-level innovation education, LBS wants to create

partnerships with several business- and engineering schools. Another project the management of LBS

is reflecting on, is the creation of a center for innovation and entrepreneurship with specific

programs.

2) Internationalization

LBS needs to increase its international dimension as it wants to enter a more global arena. Efforts are

made to develop international partnerships to offer exchange programs or double degrees that allow

students to have intercultural experiences.

3) Public sector management

The new wave of public governance, initiated by a reform by Renato Brunetta - Minister for public

administration and innovation, is changing the Italian public sector, bringing it closer to the private

sector model. The new development grants more responsibilities to employees, therefore new roles

and working trends are emerging. LBS provides training for managers to work under these new

conditions.

In parallel to these three main strategic pillars, another crucial development for LBS concerns its

faculty composition and research capability. While in the past LBS´s professors were external, LBS´s

management realized that creating knowledge within the school, thanks to a strong faculty, was a

guarantee for LBS´s quality and reputation. In 2007, Luiss Guido Carli University launched a fund-

raising program to increase the research activity. In this way LBS created an incentive for the

professors to publish their work on an international level.

4.2 Positioning of LBS´s educational model

Mr. Boccardelli explains to the consultants that there are two dominant business school models

existing nowadays. The first one is a “research-based approach”; in this case, business schools

guarantee their prestige through influential professors. Chicago Booth Business School and its

numerous Nobel-prize professors is an example of this model.

The second model is one with a much more practical approach, as “academic research is not enough

to provide value for managers”: research is used in a smaller proportion and education relies much

more on business insight – many European business schools tend to be on this side.


The following graph focusing on the equilibrium between research approach and practical approach

represents the current position of LBS and the desired evolution in the strategic view of the

management.

Figure 1: two business school approaches

The consultants are a bit confused by this figure, so Mr. Boccardelli explains:

¨As you can see in Figure 1, LBS is both oriented towards research and very close to practice. In the

future, the objective is to develop the school’s capabilities in terms of research to have a very high

level both in research roots and practical approach.¨

4.3 Competitive advantage

One of the most important competitive advantages for LBS is that it belongs to Confindustria, the

most important Italian association of employers. LBS differentiates by its strong connections to the

business area. This network of organizations and companies plays a role at two levels. On the one

hand, many professors are managers within this large business network. On the other hand, these

organizations and companies are potential employers for graduate students of LBS.

4.4 Directions for improvement

CASE STUDY LBS, JULY 2010

10

According to the strategy of LBS, becoming more global, LBS has to increase its legitimacy and

credibility on an international level. Therefore, LBS needs to work on accreditation processes, as the

school has no international accreditation yet. References in the field are among others: EQUIS,

AACSB, or AMBA.

5. HOW TO CONTINUE?

Mr. Giustiniano and Mr. Boccardelli hand over the problem to the consultants, who from now on are

in charge of finding a solution for LBS.

After taking a closer look at the history and the context of LBS the consultants decide to conduct

some exploratory interviews with managers from different companies, in order to gain a better

insight into the companies’ emerging needs. The summaries of these interviews are included in

appendix 1 results.

After conducting these interviews, the consultants start thinking about how to continue.

You are one of the consultants for LBS, and these are the questions you need to answer to:

- How would you use the data of the explorative interviews in the best way?

- To what extent can you generalize the results of the research in order to define “what

companies want”?

- How can you identify the more valuable outcomes of the research for LBS to make future

decisions?

- Considering the content of the current MBA program (see appendix two) is consistent with

companies’ needs? How would you change it?

- Can you identify new subjects that could be taught in order to develop the competencies

required for the new managers?

REFERENCES


11

Campbell, J. (2007). “Why would corporations behave in socially responsible ways? An institutional

theory of corporate social responsibility”, Academy of management Review, 32, 946-967.

Day, R. (2008). “Look at diversity as an asset”. Source: www.hrmagazine.co.uk.

Dychtwald, K., Morison, R., & Erickson, T. (2006). Workforce crisis: How to beat the coming shortage

of skills and talent. Boston: Harvard Business School Press.

Ghemawat , P. (2010). “Finding your Strategy in the New Landscape”, Harvard Business Review, 88,

54-60.

Maon, F. Lindgreen, A. & Swaen, V. (2008). “Thinking of the organization as a system: The role of

managerial perceptions in developing a corporate social responsibility agenda”. Systems research

and behavioral science, 25, 413-426.

OECD (Organization for Economic Co-Operation and Development). 2003. Section C.2.2: “Exposure to

international trade competition by industry”. OECD Science, Technology and Industry: Scoreboard

2003. OECD: Paris.

Schwab K. (2009). World Economic Forum Annual Report 2008 – 2009.

http://www.weforum.org/pdf/AnnualReport/Annual_Report_2009.pdf

Spieza,V. (2002). “The greying population: A wasted human capital or just a social liability?”

International Labour Review, 141, 71-111.

Strack, R., Baier J., & Fahlander, A. (2008). “Managing Demographic Risk”. Harvard Business Review,

86, 119-128.

UNCTAD (United Nations Conference on Trade and Development). Various years. World Investment

Report. United Nations: New York.

Watts, D. (2009). “Too Big to Fail? How About Too Big to Exist?”, Harvard Business Review, 87, 16

Wiersema, M. & Bowen, H. (2008). “Corporate diversification: the impact of foreign competition,

industry globalization, and product diversification”, Strategic Management Journal, 29, 115-132.

“Dreaming with BRICs, The Path to 2050”, Global Economics Website, Paper n. 99. Goldman Sachs

2003. http://www2.goldmansachs.com/ideas/brics/book/99-dreaming.pdf

http://www.weforum.org/pdf/AnnualReport/Annual_Report_2009.pdf

http://www2.goldmansachs.com/ideas/brics/book/99-dreaming.pdf


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APPENDIX 1: INTERVIEW SUMMARIES

Mr. B. - Fabrica Immobiliare SGR

Interview Summary

Date: May 18th, 2010

EXTERNAL IMPACTS ON ORGANIZATIONS

Could you name the most important external factor, out of the company’s control, that had a

major impact on the organization, within the last three years?

According to Mr. B there are three important factors that needs to be considered. Financial crisis,

the impact on real estate market was dramatic, everything stopped. Globalization: Real estate

markets are now open. New markets (China, Russia…).

ECONOMICS

In the next decades, world economic dominance will be shared between the G-6 and the BRIC

countries (Brazil, Russia, India and China). Which competencies must present and future managers

have in order to deal with this dominance?

Need to create international minded people. International experience (academic exchanges,

internships abroad). Need for an international approach.

International mindset? Something that comes from experience outside of Italy. To be ready to move,

ready to speak with people that have other mentalities, in another language. You have to be flexible

and to understand the other cultures (especially China for example: “I have to learn to be Chinese,

otherwise I cannot sell anything”). To adapt yourself and to learn from other people.

In the years to come, growth rates will slow down in the G-6 countries, and consumers’ demand

will be weak. This will cause a low-cost competition world-wide. What does this low-cost

competition imply for managerial competencies?

Managers have to be ready in the “cost-selling approach”, that is to say to be efficient: “don’t lose

time, don’t lose money”. They have to be ready to work more, have more responsibilities. Be more

open. Job organization. Be more focused on your core business.


13

The crisis of the “real” economy started from a Financial Crisis. The behaviour of top managers has

been blamed worldwide. Considering this point of view, which characteristics should the next

generation of managers have?

Need a new approach: professional, transparent, clean way of doing business. Not too risky attitude.

Strength in analysing risk. Only go for secure opportunities. Transparent and independent approach.

You need to be trusted to win, to build trust so as to develop strong partnerships. Guarantee an

ethic way of doing business.

Governmental intervention has been essential to come out of the crisis. The role of the public

sector will be prominent in the future. What competencies do next generation of managers have to

develop in order to cope with this?

Need to be patient. Understand bureaucracy, long and risky timing. You have to push them (but in a

proper way) and make them follow you, to communicate the benefit that you can bring to the public

counterpart. Managers need to have a “commercial approach”.

GLOBALISATION

As companies are becoming more and more global, managers are working in an intercultural

environment. What competencies do they need to develop in order to adapt to this new

intercultural environment?

Improve proportion of international students in the MBA program. The professors should come from

international Business Schools. Courses should be in English. Need to be in an international

environment from the beginning.

How do you imagine the characteristics of the global leader, now and in five years?

International mentality. Fast in understanding business situation and making decisions. Managers

have to read newspapers, to be aware of what is happening at a broad international level. The

language: Italy is lagging behind on that.

Companies’ organizational structures are losing span on the vertical dimension (hierarchy) and

getting flatter (horizontal teamwork is increasing): how does this impact managerial

competencies?

Be ready to work in teams with different people and approaches. Focus on business planning.


14

What managerial competencies are needed for managing multicultural teams?

Be patient. Understand this multiculturalism is a value. Understand who is in front of you (profile,

culture), to make the best from each team player.

Information and Communication Technologies are reshaping the job design and working

conditions, what are the impacts on competencies required from managers?

The new manager has use tools in a proper way, be ready to discover new tools, be ready to learn.

But be careful because “technology can run over you”. It can be very time-consuming.

DEMOGRAPHY

The population and therefore employees are aging; in your company, what kind of solutions do

you see for this challenge?

Managers have to understand that they cannot ask 65 years old employees to do the same tasks as

30 years old employees. Adapt approach. Be patient. Use their asset, which is their experience.

Understand the competencies of everyone.

When a lot of employees in the company retire, what competencies are needed for managers in

order to prevent critical knowledge from being lost?

Managers need to be open and ready to learn from experience of others, and by doing yourself. And

adapt to a different language. Need to be humble.

Very different generations are now coexisting in the company. This may generate conflicts and

misunderstandings. How does this diversity have an impact on managerial competences?

It is a question of mentality. Need to be open-minded. Humility. Be ready to learn.

CORPORATE SOCIAL RESPONSIBILITY

Companies are experiencing increasing pressure from stakeholders to invest in CSR. What impact

does this pressure have on managerial competencies needed?

Need to be professional, open/”clean” and transparent. Give a good image of yourself and of your

company.


15

What managerial competencies are needed in order to understand stakeholders requirements?

What managerial competencies are ensuring a good reputation for the company?

Understand you have to defend the reputation of your company. Again, transparency and

professional approach.

Former Prime Minister of the UK, Gordon Brown, claimed: ¨we will join a Green New Deal¨.

President Obama promised to pump $150 billion into green technology over the next decade.

Which competencies do managers need to develop to work in a world, where the so-called “green

economy” will become extremely important?

Managers will deal with green economy more than in the past. It is a good chance to do something

social, and do it for business. It is connected to the reputation of the company, providing it a clean,

green image. It is mainly a matter of personal sensitivity. If you don’t have it, it is important to

understand the potential, the benefit on the image of the company. The manager needs to be ready

to study about something that is quite new, and have a business approach about it. It will be very

important in the future as a business opportunity but also in term of reputation.

It is becoming an issue for companies to encourage gender diversity. How does this gender issue

have an impact on the managerial role and their expected competencies?

The real estate sector is a male dominated sector. Therefore, there are no special competencies

needed. Just to understand people, understand the persons who are in front of you.


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Mr. V - Director of Operations and Development - Gruppo Della Valle

Interview Summary

Date : May 17th, 2010

EXTERNAL IMPACTS ON COMPANIES

Could you name the most important external factor, out of the company´s control, that had a


When asked what external factor had a major impact on the organization, within the last three years,

Mr. V immediately mentions the globalisation of business. According to him, this creates a need to

rethink how the company is organized, in order to be able to send its products in many countries. He

mentioned that Italian companies are still operating with a lot of “power to the center”: operations

all around the world are rather an “execution of what is decided at the center”.

Therefore companies need people who know different cultures, who “know the world”. Then he

thinks of another external factor: the “value for money perception” of the consumers, which has

changed after the crisis.

ECONOMICS

China and India may account for 50% of global GDP by 2050, and forecasts (Goldman Sachs) claim

that China will overtake Europe by 2023. World economic dominance will be shared between the

G-6 and the BRICs countries. Which competencies must present and future managers have in order

to deal with this dominance?

Answering to the question concerning the new economic dominance, Mr. V expresses that

companies have to put in place an organization that is able to understand differences among the

different countries in order to operate in different environments This will bring the need to have

managers that are able to cope with these differences and to report to the HQ what are the needs of

the different countries. He gives an example concerning China: “Tod’s need people that go there, get

to know china and its consumers”.

In the years to come, growth rates will slow down in the G-6 countries, and consumers’ demand

will be weak. This will cause a low-cost competition world-wide. What does this low-cost

competition imply for managerial competencies?


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M. V says that nowadays brands are extremely important and “companies need to communicate to

consumers that there is value behind the name”. In his view, a low-cost competition will not bring

long-term result. “Long-term winning is about value around your branding”.

The crisis of the “real” economy started from a Financial Crisis. The behaviour of top managers has

been blamed worldwide. Considering this point of view, which characteristics should the next

generation of managers have?

In Mr. V’s opinion, this is linked to the problematic idea of “making a lot of money on a short-term”

basis. He believes that in the future, there will be a strong importance given to industrial values, and

to the idea of building companies that last on the long-term.

He insists on the idea that long-term view is much more important than short-term one, and he

underlines that this perspective is already changing in the marketplace.

As a conclusion, he states: “we have to have managers looking at generating value for the long-

term”.


sector will be prominent in the future. What competencies do next generation of managers have to

develop in order to cope with this?

Mr. V thinks that managers should not think that the government will help. “The economy should be

able to find its own solutions. Managers should be focused on their business.”

GLOBALISATION

As companies are becoming more and more global, managers are working in an intercultural

environment. What competencies do they need to develop in order to adapt to this new

intercultural environment?

As Mr. V says, “the big word here is diversity, being able to understand diversity”. It is particularly

important for Italian culture. Managers have to understand that there are different behaviours,

different ways of looking at things. He quotes the example of the Japanese: “even if they are not

shouting around the table, they are giving their point of view, they do it in their own very respectful

style”. Italians would say, “they are sleeping, they are not strong enough”. Indeed understanding

diversity is the most difficult thing. He concludes: “in fact, the new generation has to travel a lot.”

How do you imagine the characteristics of the global leader, now and in five years?


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Mr. V explains that it is someone who has been working in many places. Someone who has an

experience of different cultures. “The more you look at the future, the more intercultural experience

is needed”. He says that now there are global leaders but that not all of them have global experience.

Then he gives an example: “in Tod’s I am pushing for a program where many people are travelling in

different regions. In five years, they are going to be better managers.”

Companies’ organizational structures are losing span on the vertical dimension (hierarchy) and

getting flatter (horizontal teamwork is increasing): how does this impact managerial

competencies?

About the flat organization, Mr. V expresses that teamwork is indeed becoming more and more

important. And again, it means working with different cultures. He underlines: “I believe that

globalization is creating more power at the centre”, so companies will need very strong leadership at

the centre. He believes that the company is evolving with two phenomenon’s: first, the need for

global managers with a lot of power at HQ, and second, good team work people spread all around

the world.

What managerial competencies are needed for managing multicultural teams?

Mr. V emphasizes the ability to listen, to understand the communication and the way this

communication is done. He repeats that listening is a big competence that managers have to learn,

as there is a risk: when they have successful careers, some managers tend to believe they know

everything.


conditions, what are the impacts on competencies required from managers?

As far as the increasing importance of ICT is concerned, MR. V thinks that managers in the future of

course have to know new technologies and tools. However, as there is a lot more communication, he

warns, “managers have to cope with it, have to find the right balance”. Managers in the future will

have to change the way they work every day. They have to use these tools in a way they “don’t

become trapped”, as it should not take too much of their time.

DEMOGRAPHY

The population and therefore employees are aging; in your company, what kind of solutions do

you see for this challenge?/ When a lot of employees in the company retire, what competencies

are needed for managers in order to prevent critical knowledge from being lost?


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Concerning knowledge management, Mr. V says that organizations have to prepare the new

generations for taking over; he gives an example from his own experience: “the day I left Procter and

Gamble, I had prepared a lot of managers that knew all they needed to take over”. Organizations

have to make sure there is a good flow of information. They also have to “put the younger people

below the more senior people”; of course, a structure with a lot of delegation is needed, to make

sure that not only top managers know what to do.


misunderstandings. How does this diversity have an impact on managerial competences?

Mr. V expresses that it is important to listen to the new generation. “It is important that senior

people have an attitude of favouring change and let the younger generation lead the change”. He

underlines that “the company evolves in the way the thinking of the new generation evolves”, and it

is crucial to keep the company keep as young as you can.


Companies are experiencing increasing pressure from stakeholders to invest in CSR. What impact

does this pressure have on managerial competencies needed?

MR. V expresses that “CSR is very important”, “you have to have the sensitivity” for it.

He explains that the competencies to build are more “a sensitivity, an attitude”; being aware of it is

important. In this perspective, he thinks that the new generations are essential for bringing this

thinking to the company. He believes it is a strong advantage to have people taking care of CSR in

their daily activities (what leather for shoes for instance). It is about building a new culture that

comes from the younger generations.

What managerial competencies are needed in order to understand stakeholders requirements?

Mr. V expresses that “managers should not live only inside of the company, but also be part of

outside the company”. “A manager has to go out and meet people”. A manager has to “be attentive

to the outside world”.

What managerial competencies are ensuring a good reputation for the company?

In M. V´s view, ensuring reputation is related to communication skills: “image and reputation comes

from what managers communicate”. “Managers need to go out and talk”.

Former Prime Minister of the UK, Gordon Brown, claimed: ¨we will join a Green New Deal¨.

President Obama promised to pump $150 billion into green technology over the next decade.


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Which competencies do managers need to develop to work in a world, where the so-called “green

economy” will become extremely important?

When it comes to green economy, Mr. V underlines that again, this is about “understanding the

external world”; understand this external world is important “to be a social responsible manager”. It

is a matter of being aware of the need to think about sustainable development. So what is needed is

to build a “sensibility”17. Then he explains that while in the US green concern it is already very

developed, in Italy it is developing only right now.

It is becoming an issue for companies to encourage gender diversity. How does this gender issue

have an impact on the managerial role and their expected competencies?

According to Mr. V, this is a question of culture inside the company. “Managers have to understand

these needs.” Of course, “companies also have to define their priorities”. It comes again to the idea

of “listening to the outside world”; managers have to “understand what is important and why”. He

specifies, “Italy is still a male society”. Gender issue will become a serious concern only when

companies “understand that this will made them more successful”; managers have to believe that

first.

Do you see additional challenges for managers’ competencies regarding other forms of diversity?

When asked about other challenges regarding diversity, Mr. V mentions that there are still a lot of

prejudices in companies.

17

According to interviewer, Mr. V referred to ‘sensitivity’ instead of «sensibility»


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Mr D. starts to talk about his background: he started as a financial analyst at ABBOT. After this the

attended an MBA at Luiss. After that he worked as a consultant. Then TL com was launched. This is a

venture capital fund (investment fund). So Mr. D fulfilled several roles and functions as being a

consultant, manager and investor.

EXTERNAL IMPACTS ON COMPANIES

Could you name the most important external factor, out of the company’s control, that had a


The most impact is the financial crisis and the changes in global demand. This made relocation of

manufacturing very important (to countries like China and Asia). Furthermore the credit crunch made

it very hard for organizations to get a loan.

ECONOMICS

In the next decades, world economic dominance will be shared between the G-6 and the BRIC

countries (Brazil, Russia, India and China). Which competencies must present and future managers

have in order to deal with this dominance?

One of the main skills a manager needs to have is a broader world view. He or she needs to be able

to act as a manager with global perspectives. He or she also needs to be able to understand the

different impacts of this dominance on: cost-structures, price schemes and cultures.

The crisis of the “real” economy started from a financial crisis. The behaviour of top managers has

been blamed worldwide. In this context, which attitude should the next generation of managers

develop?

In the past the predominance of ethics was lacking. The first objective of companies was to maximize

shareholders value. Nowadays it is very important to create value for other stakeholders as well.

Mr. D - TL Com

Interview summary

Date: 24-05-2010


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Fairness in dealing with the client became more and more important.18 Furthermore, ´it becomes

crucial that a company acts in a way that is consistent with the health profile of the customers` 19.

The company needs to focus more on social responsibility and the hidden costs of doing business.

This means focussing on the effect doing business has on the customers or clients.


sector will be prominent in the future. What competencies do the next generation of

managersdevelop in order to cope with this?

According to Mr. D a lot of decisions cannot be taken without the involvement of the public sector.

Dealing with the public sector is key in business nowadays. Regarding to this the skills needed from

managers are the following: the ability to establish relationships with politicians, understanding of

how the public sector works, understanding of the people working within the public sector.

In advanced economies, middle classes are losing purchasing power. New business models are

invented worldwide in order to keep prices low. What competencies should a manager perform in

a market where the customers ask for lower prices?

¨The impact of the price competition can kill the way how organizations work¨ (Mr. D). This has

several implications: first, providing value is the only way to compete. The managers must

understand the value of service associated with the product. Second, innovation is becoming more

important, the continuous adaptation of products and it´s features.

GLOBALISATION

As companies are becoming more and more global, managers are exposed to an intercultural

environment. What competencies do they need to develop in order to fit in this new intercultural

environment?

Thinking global involves understanding different needs, cultures of customers, and employees. In

order to do this as a managers need to travel, need to go abroad and be flexible have an open

mindset.

Companies’ organizational structures are losing span on the vertical dimension (hierarchy) getting

flatter (horizontal teamwork is increasing): what new competencies do managers need?

18

The interviewer made a suggestion about the link to transparency and the interviewee agreed. 19

´In Vivo`


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Flatter organizations need higher levels of delegation. Therefore, companies need to delegate also

the accountability for the results for the parts on which the managers are responsible. The success

factor for this is appreciating and understanding other people´s success beside only your success as a

manager.

In your view, what managerial competencies are needed for managing multicultural teams?

Understanding different cultures is difficult. Managers need to be able to think critical, give

everybody within the organisation the power to speak, and give space to different people.


conditions. How should future managers be prepared for this?

ICT has provided the access to a larger amount of information. Therefore, managers sometimes have

access to too much information. They need the competences to focus and prioritize and the ability to

understand important information.

ORGANIZATIONAL DEMOGRAPHY

Regarding employee turnover, what competencies are needed for managers in order to prevent

critical knowledge from being lost?

It is nowadays impossible to prevent that knowledge passes the borders of the organization.

Therefore, job rotation is important. Than the dependency on people decreases with regards to

knowledge. A managerial skill that became very important with regards to ICT and job rotation is

communication.


misunderstandings. According to you, how can managers be prepared for this challenge?

The former tradition was more based on the idea that experience within the company was very

important. Different generations working together have to compromise a lot. Therefore, job rotation

and team playing became more important to make people understanding the work of other people.

Clarifying question; how job rotation influences the skills needed from managers. Today managers

need to make a lot of decisions very quickly with a lot of pressure. Need to have an helicopter view.



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Companies are experiencing increasing pressure from stakeholders to invest in CSR. Which

competencies and attitude do you expect from managers in this field?

Need to maximize the value for all shareholders. There is a need for symmetry of information for

customers and employees. Need to understand societal cost associated to your business (child

labour, countries where there is no freedom of speech, renewable energy); being aware of this

contributes to improve the value of the company in the long-term. Taking care of these topics is a

real objective for managers, while 10 years ago it was only maximizing shareholders’ profit. “Think of

the company as a piece of world life”20.

Ensuring a good reputation for the company has become crucial. What are the managerial

competences needed?

Managers in the past were only focused on increasing margins. Now they need to take into account

externalities. There need to be internal and external communication about the company taking care

about CSR.

It is becoming an issue for companies to encourage gender diversity. What mindset and behaviour

do you expect from the next generation of managers concerning this issue?

It is a cultural issue. It will be solved by the next generation of managers. The new generations don’t

make differences about diversity, in 10-20 years it will be solved.

20

Quote of manager.


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APPENDIX 2: STRUCTURE OF THE PRESENT MBA PROGRAM

The current MBA program is a full-time 17-months postgraduate program, which is tailored to

students with a broad academic background, who want to achieve managerial positions. The features

of the program are the following:

- A limited number of students, selected on the basis of rigorous admission criteria

- Compulsory attendance

- The intensive study of foreign languages

- Emphasis on computer science and information technology

- Assistance from qualified tutors

- World-class professors and lecturers coming from the academic world and the top

management of both public and private sector

- A broad network of cultural exchanges with numerous international universities

- Internships in public and private institutions

The teaching methods depend on the specific course and vary from seminars, role-plays, case

studies, business games, team exercises, conferences and projects.

The program starts each year in November, and the curriculum is designed according to the belief

that the students should acquire a thorough knowledge of the basic skills and concepts in all

functional areas of business and management, so that they become more than specialists.

Below is the structure of the program:

Preparatory courses

o Mathematics

o Basic Accounting

o Informatics

o Statistics for Decision Making


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Core curriculum

o Business English

o Corporate Finance

o Corporate Investment Banking

o ICT Management

o Innovation Management and Production Systems

o Management Accounting and Control

o Marketing

o Organisational design and Human Resources Management

o Political and Industrial Economics and Economics of Strategy

o Quantitative Methods

o Strategy

o Tax and Corporate Law

Elective courses

Project work

In addition to what mentioned above, LBS offers different career services such as career-planning,

counseling, training, seminars and meetings with companies (e.g. “MBA for the companies” day-long

event including seminars relating to HRM). Furthermore the best and most motivated students are

offered the opportunity to participate in an exchange program which is established among Luiss and

some of the leading international universities.

Case study. what companies want

Business

Transcript of Case study. what companies want