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Legacy Of A B School Legend

Management: B-Schools

Legacy of a B-School Legend

Kellogg will find it tough to replace its innovative dean, Donald Jacobs

Just before Thanksgiving nearly 20 years ago, 40 MBA students were assigned to hand in a paper the Monday after the holiday. No wrangling by the school's dean could persuade the professor to change the due date, dooming some class members to go without turkey and stuffing. So the dean packed his pots and pans, his seasonings and cranberry sauce, delivered himself and all the trimmings to the graduate dormitory, and cooked for everyone who couldn't make it home. The impromptu holiday meal became a yearly tradition for Donald P. Jacobs, the dean of Northwestern University's Kellogg Graduate School of Management. Now more than 600 people sit down for Thanksgiving dinner in the James L. Allen Center, the school's executive-education conference facility.

But starting in 2001, someone else will have to carve the turkey. Next spring, after 25 years of building Kellogg's stature, Jacobs plans to step aside. Although the retirement of this B-school legend has long been the subject of speculation, the reality is just now sinking in for educators, students, and business executives. The 73-year-old Jacobs, who plans to stay on as a professor, will leave behind a legacy that's much larger than Kellogg. "He changed the rules in management education," says Meyer Feldberg, dean of Columbia University's Graduate School of Business and a former Kellogg professor. "The rest of us kind of followed."

Jacobs has been at the forefront of most of the key innovations that have shaped MBA programs since the mid-1970s. He dragged professors out of their ivory tower and forged links with real-world executives. He insisted on treating students as customers and adapted the curriculum to fit their evolving needs. And he overhauled course work to emphasize cooperation among students, rather than each student for himself.SUCCESSION QUESTION. But if Jacobs has an uncanny ability to spot the next challenge around the bend, he also missed one: his own succession. That's just not something that B-schools have learned to do well, and Kellogg is no exception. As a result, the question of who will replace Jacobs--the most likely inside candidate is associate dean for academics Dipak Jain--raises questions about the future of a business school that BUSINESS WEEK ranks No. 2 in the U.S. Finding another leader who is as charismatic and involved won't be easy. Says longtime Kellogg marketing professor Phil Kotler: "It's like replacing a Jack Welch."

To see how far business education has come, just look back at the landscape pre-Jacobs. In the 1970s, business schools were still trying to shake the stigma of being glorified trade schools. Scholars mostly told company war stories, and curriculum was narrowly focused on skills such as accounting. CEOs groused that MBAs were good at crunching numbers but ill-equipped to work within real organizations.

A big part of the problem stemmed from the academic traditions of the schools themselves. They stressed individual achievement and competition, but Jacobs saw that successful managers worked in teams. Thus he became an early advocate of cooperative learning, where students from different disciplines pull together to analyze problems. Some colleagues were aghast--the dean of another business school volunteered that such a sharing approach was traditionally called "cheating." Educators also worried that a more practical and customer-oriented program would erode pure scholarship. Those concerns diminished as a flood of new resources helped ensure the schools could fulfill both missions.INTERVIEW REQUIREMENT. To get it right, Jacobs had to have students who thrive in a cooperative atmosphere. In 1976, he was the first to require that all applicants be interviewed before being admitted. Others laughed, but almost all top B-schools have followed suit. Jacobs also decided that faculty spent too much time on theory and that they had to devote more time to teaching. He became famous for expecting them to pull four or more courses a year while interacting with real practitioners of business. Organizational behavior professor Robert Duncan, for instance, recently taught a group of senior level executives from around the globe. He tested his own research out on them, then took the executives' experiences back to his MBA class on strategic change.

Integrating executives and MBAs makes sense, but Jacobs' proposal for the multimillion-dollar Allen Center for executive education was highly controversial back in the '70s. The university provided land, but administrators doubted that corporations had enough interest to keep the program going. It would be the first such program to be staffed with professors instead of just adjuncts. "They thought they'd end up with a nice dormitory when it flopped," recalls Jacobs from his corner table in an Allen Center dining room overlooking a lagoon off Lake Michigan. Today, the center is a showcase for the school's talent and serves hundreds of executives each year.

A lifelong academic, Jacobs never hesitates to pick up the phone and call execs to push his latest ideas. And he's proved adept at soliciting their financial backing. Along with Donald S. Perkins, former CEO of Jewel Cos., Jacobs launched the first conferences to debate controversial topics such as executive pay. Today those meetings pull in an A-list of big-time CEOs. Jacobs' admirers include Michael Miles, former CEO of Philip Morris, and Kellogg alums Betsy D. Holden, CEO of Kraft Foods, and Robert A. Eckert, CEO of Mattel. Says Eckert: "He's a change agent who makes you feel good about being a part of whatever he's doing."CHANGE ON A DIME. Jacobs believes that students should be treated more like customers and less like products. "It's a very simple idea, but his execution is exquisite," says Stuart I. Greenbaum, dean of Washington University's Olin School of Business. A key step was to instill a change-on-a-dime mentality: If the students need it, the question isn't how much it will cost but rather how quickly it can be done. A few years ago, for instance, Kellogg and other schools ventured into e-commerce. Most programs took a year to revamp curriculum. Jacobs' faculty and students took only a month to develop a cohesive program as a separate concentration.

Kellogg can only hope that its next dean will have similar vision. The challenges that B-schools will face over the next quarter-century are daunting. University administrators must find ways to keep courses relevant amid a flood of new technologies, while maintaining rigorous standards. And they will have to sort out the rights of entrepreneurial faculty while protecting schools' intellectual capital.

By taking risks, Jacobs forced his school to adapt through nearly three decades of business tumult. The payoff is that Kellogg's grads today are some of the most sought-after MBAs, with a median compensation package of more than $140,000 for the Class of 2000. He will be a tough act to follow.By Jennifer Merritt in New YorkReturn to top

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