Thierry Grange founded Grenoble Ecole de Management in 1984 and has grown it into one of France's top ten business schools. Here he explains why the opportunities for business grads have never been better, and why he favors b-schools "in the middle of nowhere".
It seems like every week there are new business degrees on offer. Do we really need this many business graduates?
Well, companies have to find new profit centres, so they will always need new expertise for new kinds of jobs.
The jobs we are doing now would have been difficult to imagine 15 years ago. As long as business schools are led by what’s happening in the real world, their graduates will be needed.
What we don’t need are exotic new degrees created by business schools just trying to be different from the competitor across the street.
How will this recession change business?
In one way nothing will change: there will be another recession in 2015. Recessions happen every seven years or so. We had a crisis in 1993, in 2001, and in 2008.
The crisis will show people the difference between the real economy; industry and manufacturing; and the virtual economy; banking, speculation and financial operations that have nothing to do with the real world.
People are aware that there are two worlds. It wasn’t that easy to teach before.
Banks can make much more money in the virtual economy than in the real economy.
Students have to make a choice about whether they go for the real economy or the virtual economy.
As the world’s population grows from six billion to nine billion and resources start to run out, the real world will become more dominant. But not yet, it’s too early. So in business schools we have to prepare students for both worlds.
Is the worst time for students to graduate, isn’t it?
Absolutely not. There are more jobs available today than a good business school can cope with.
In the 1960s it was very difficult for a young person to get a job without family connections. When I graduated in engineering at the end of the 1960s nobody could imagine that there would be an IT revolution. People told me I had no chance in programming.
About 10 per cent of Grenoble graduates take up opportunities in emerging markets. Two students have big retailing chains: one in Hungary, one in the Czech Republic, growing at double digits.
Even if you’re only making €25,000 a year in an emerging country, your purchasing power could be that of someone earning €50,000 in France.
The real problem is for blue collar workers in the West. There are fewer and fewer jobs that afford them an acceptable standard of living.
Who’s more unethical? An MBA who makes millions selling mortgage-backed securities or an accounting professor who neglects to teach the systemic risks associated with off-balance-sheet liabilities?
Neither. The guy making a lot of money selling mortgage securities is a good guy because we have told this student that he will have no retirement plan.
Nowadays the only money you have is what you make during your working life. If you can make money right now, you do it.
The boss of Societe Generale, a bank which lost €5 billion, retired with a pension of €1 million a year. So can a professor of accounting tell his students: I think this man is a very bad man and I invite you to be poor?
Both the professor and the trader exist in a world where greed is good.
What is the biggest challenge for you right now?
The first is institutional: to survive against competition from emerging countries.
The second is to train managers for the economy of the next 20 years. It’s difficult, because we don’t know exactly what that will be.
Third, to teach the right values. Accounting, marketing and finance you can learn on the internet. But ethics is a matter of behavior, not of knowledge.
That said, Harvard graduates have been involved in business scandals in the US despite having learned ethics… we need to define what our core values are and that’s not easy.
What’s the most exciting development in business education right now?
The most exciting thing is the globalization of our activity. It’s a great chance for European schools, which are between the US and Asia geographically and philosophically.
China alone is much more diverse than Europe. Harbin, Manchuria, Guangzhou, and Xian: all these places are very different.
There’s more competition today but also a lot more opportunity.
When you were 12 years old what did you want to be?
I wanted to be an engineer producing racing cars.
Which business person do you most admire?
I admire people who create value by developing new products and services, especially in manufacturing as Grenoble is in a manufacturing region.
I admire Ferdinand Piech (automobile engineer, Porsche heir and former chairman of the Volkswagen Group), who grew Volkswagen into a world-beating company with Audi, Lamborghini and so many other products.
He has also married four times, each wife more beautiful than the last.
I also admire entrepreneurs who succeeded in innovative sectors like biotechnology and nanotechnology: I admire the guy in a small lab in Bristol or Cambridge.
I don't think much of Jack Welch. Electrical engineering is a monopolistic industry – there are only four or five big operators. So what? He didn’t take up a big challenge.
Tell us something your students don’t know about you
They know that on weekends i’m out with other bikers and we all wear black leather. What they don’t know is that I play in a swing band in a jazz venue in Grenoble. We’re called Five For Fun and we’re all over the age of 50. I play the washboard.
On rare occasions a student will recognize me and say “Oh! Are you really the Dean?”
Tell us what’s great about Grenoble Ecole De Management in one sentence
It’s a school that’s shows every day that a small school in the middle of nowhere can become visible global school.
[Second sentence] If Grenoble can make it, Kazakhstan can make it! Yorkshire can make it! Newcastle upon Tyne can make it!