A pragmatic leader
There are 24 men around the world who stand in for George Clooney as voice doubles: Sir George Bain, with his distinctive tone, could be the 25th. It was academia, however, not acting that appealed to the self-styled ‘unilingual British-Canadian’. Sir George presided as Dean of London Business School from 1989-97 and returned, with his wife Lady Bain, to Number 1, Sussex Place for a 50th Anniversary reunion of emeritus professors.
Asked to share his views on leadership, he said: “The trick is to move before you get pushed, and before you get stale.” Small wonder, then, that he developed a reputation for pragmatism, an attribute highlighted by the Times Higher Education in 2002.
Providing a professional passport
Sir George has helped take the School’s management training (MSc) from obscurity and, at the time, “ridicule” to becoming the professional qualification to have. "Learning management thinking from academics just wasn’t seen as a good use of time." The consensus was that people should learn on the job and, "certainly not take a year out to study", he says. As professionals graduated, their direct impact on the workplace built up a reputation and in doing so – over 20 years – the School became one of the major institutions to change that view.
Irish-born Charles Handy, who was at London Business School from 1967–77 before becoming a writer and ‘social philosopher’, wrote in the early 1980s about how poorly educated British managers were. Referencing him now, Sir George says that doctors had medical degrees from Imperial or St Mary’s, accountants had chartered accountancy status and the School had the MBA. He explains that the MBA is the professional passport to management, giving people licence to say, “I’m a manager because I’ve got an MBA.”
At the start of his term as Dean in 1989, the School was predominately British and was set-up to educate British managers. He explains: "At the time there was opposition to having international students, perhaps because you were educating the competition or worse, sleeping with the enemy." His first role was to make the School an international institute.
When Sir George was appointed Dean, London Business School’s internal goal was to “beat INSEAD.” Soon after standing down as Dean, the Financial Times started ranking the world’s leading business schools. The School came ninth that year and its MBA is now ranked second in the world. This move from unknown to the top 10, and then the ability to sustain top rankings, is what he is most proud of: “During my term, we were very much second-best to INSEAD. There were no league tables – but we were the best British school. Fortune Magazine did a survey in 1988 of European Business School’s and placed INSEAD first and the School second.”
Reflecting on the competition, he says: “We used to call the three European schools of the time – IMD, INSEAD and LBS – ‘the big three’. Antonio Borges (Dean of IMD) worried that the international trade commissioners would think we were the cartel trying to regulate the industry. But we exchanged a lot, and they were great Deans.”
His primary objective – to take the School global paid off. During his term as Dean, about 75 per cent of students were British: today, 88 per cent of our students come from outside of the UK.
In the 1980s INSEAD had an entry requirement of bilingualism. Joking that he struggles with “just English”, Sir George says: “If we made bilingualism a prerequisite, we would make it too difficult for great British managers to enter the School. But we did make a second language an exit requirement. The students pushed for this; it was what they wanted.” This new linguistic requirement saw student job offers multiply significantly as a result and went some way towards achieving a global outlook for the School.
Managers: from hero to zero
In the early 1990s the manager was hero; Thatcherism had left its mark on the world and the new enterprise economy had taken off. Sir George recalls TV programmes about corporate life from that era. “The senior executive was a John Wayne-like character in a dusty western town with his opponent there,” he says. Since then, managers have, in his opinion, become villainous characters, a juxtaposition of the ‘90s cowboy heroes.
Corporate greed is in part to blame for the anti-hero, and, for Sir George, one of the main business challenges of the future. He explains: “There’s a problem with the link between pay, reward and performance. They just don’t correlate.”
Management thinking dating back to the 1930s suggested that managers and shareholders held the same objectives. Today, managerial interests are very different from those of shareholders. “I think Corporate Governance is a major theme of the future and also Corporate Social Responsibility (CSR),” Sir George says. “It’s got a lot of lip service, but it’s a massive issue.” He explains that for him, as society becomes more egalitarian, CSR becomes even more imperative.
The Quick-Start business button
In 1989, the School was at the cutting-edge of technology. Email was being established and Lady Bain recalls that it was here that she acquired her first computer. Sir George remembers that through BT, the School future-proofed itself with cables to match the technology of the time. Today he has an iPad and iPhone and declares that he simply “couldn’t live without the stuff”.
The internet, he says, makes it much easier to become an entrepreneur, adding that distribution, people (customers and employees) and capital are now less of a barrier to business because of advances in technology.
On distribution, he explains: “Today you can reach customers so easily with the internet; you don’t need a big distributor.” As for the second point, he says tongue in cheek that people equate to problems. By drawing on research from the 1930s, he believes that ‘just-in-time’ employers make people-problems a thing of the past. He references Ronald Harry Coase and his paper on ‘The Nature of the Firm’ (1937), which introduced the concept of transaction costs to explain the limits of firms. According to Sir George, the paper’s “significance wasn’t realised at the time. The theory parallels today’s contract workers, who simply don’t get hired again if they underperform. This, Sir George says, creates an easy process and fewer managerial problems for start-up businesses.
For Sir George, visiting a record company, a bank manager, or a private investor and convincing them to approve finances for a new venture still has its place, but he sees technology as a fast-track vehicle for capital. “Today, there are lots of different ways to raise capital: crowdfunding for example. I think you would find today that the barriers to competition are greatly reduced. You can get to customers, employees and capital much more easily.”
Business theory in practice
Sir George was the first chairman of the Low Pay Commission, from 1997 to 2002 and then again from 2008 to 2009. He was tasked with establishing the minimum wage level in the UK, subsequently hailed as the most significant policy in 30 years by The Institute for Government. His crossover at the School and working alongside the Government put business thinking at the heart of meaningful policy.
His top tip for translating business education into business success: ‘Ask the question: what is the most significant problem?’ and then focus on that.