Business School, Grown Through 41 Years, Feeds the Country with Leading Executives

President Conant called it an "endorsement of a great educational enterprise," and Dean Donald K. David termed it an "expression of confidence" when John D. Rockefeller, Jr. last June presented the School of Business Administration with a $5,000,000 pledge and, along with it, one of the best testimonials the School has ever received.

"I am convinced," the noted business man declared at the time, "that the Harvard Business School is making the most significant contribution of which I know toward the strengthening and perpetuation of...enterprise based on individual initiative."

Actually the School didn't require any such endorsement. For 41 years it two-year program "to develop administrative abilities" has been turning out distinguished, prosperous business leaders to such an extent that there aren't many persons today who won't unhesitatingly grant the School first place in its line.

Despite all this, the Rockefeller pledge has forced the Business School today to show real evidence for its reputation. Under terms of the donation, the $5,000,000 must on July 1, 1950 be matched by an equal amount in gifts or pledges toward the School's $20,000,000 expansion program. "It's a real test for us," one official put it recently. "We feel we've got something that helps American business, and now in our drive for funds we'll see if business really thinks we're worth while."

"Learn to Do by Doing

The key to Harvard's view of business education is the notion that "one must learn to do by doing." Years ago in 1908, when the School first opened, its leaders decided to minimize the study of facts, rules, and routines, and that's the way things have stayed ever since. Meanwhile, what started as a modest, small-scale "problem method of instruction" has evolved through the years into the School's famous "case system."

Under this system, which has its roots in the Law School's case method as well as medicine's clinical method, each of today's 1,350 Business School students is probing into 500 cases a year. Material is drawn from a Baker Library stock of over 5,000 "active" studies of situations that have actually occurred in business, and before coming to class on each assignment, every student must put himself into the situation and come up with an appropriate decision. There is no right or wrong; it's the business thinking that counts, for after two years of this intensive diet, making executive decisions should become second nature to a Business School man.

This is the reason why the School's graduates are so popular in the job market, and it's also the reason why the expensive Harvard education (tuition is $800 a year) can meet the increasing competition of be-paid-as-you-learn corporation training programs.

Disadvantage at the Start

The corporation programs usually emphasize better preparation for a man's first job. After all, Business School education, intensive as it may be, is developing the "able business administrator," not the salesman or assistant buyer. But while the corporation training programs can and do give non-Business School graduates a bit of a boost at the start, Harvard education can pay off at promotion time. Surveys have shown that the Business School man, even without the training in routines, isn't at all slow in adjusting himself to his first job, thanks to his indirect study of business as a whole.

Of course this Business School education logic sometimes goes astray, because teaching a young man to be an executive before his time can occasionally lead to trouble. "We often find a good bright boy, say from Middle-bury, more satisfactory," a company personnel man once reported. "These Harvard men walk in here and expect a desk twice as long as mine and with half a dozen push buttons."

The "push button" case, happily for Harvard, is the exception and not the rule. Placement figures have always been high, and if anyone regrets the existence of the Business School it's probably the firms that can't offer high enough salaries to attract the Harvard men into their organizations. Most banks and accounting firms can't afford starting salaries much over $250 per month, while the average company operating through the School's Placement Office these days is offering from $250 up to $350 a month as a starter.

Eight-nine percent of the Class of 1949 has already landed jobs, although only about a third of the positions were secured through the Placement Office. A total of 215 firms sought Business School men through the office last year, but placement directors claim that "things look a bit tougher for this year."

They Still Like Harvard

Nevertheless, the fact remains that most company "ivory-hunters" consider a Harvard Business School man a better prospect than a graduate of any of the nation's 139 undergraduate business schools or five other graduate business schools (Stanford, Chicago, New York University, Dartmouth, and Columbia.)

When reasoning why the Harvard man is such a prize catch, there is one important factor that the merits of the School's case system should not overshadow: the Business School's student is a remarkably able man even before he begins his two years across the Charles.

Working under the understandable theory that its program produces best results only in the "Well equipped" man, the Business School is extremely particular in-choosing its students. There are three applicants for every available place, and thus the Admissions Office has a wide enough selection to pick the men it considers the potential business leaders of the future.

Admitting a Student

There aren't any formal standards that help the Admissions Office spot the "well equipped" man. Instead, the School prefers to survey a man's entire past performance, looking especially to see how he has chosen to spend his time, how well he has executed whatever he has chosen, and how much good these activities have done him. All these factors, the School feels, are clues to the bigger problem of how well-suited the man is for a career in business administration. The School is not hunting for grinds with good marks, for the ideal business administrator is no introvert.

All this security at admissions time leads to a school with few failures throughout the two-year course. This doesn't mean that the life of a Business School student can be an easy one; on the contrary, the School expects the average student to devote 60 hours per week to his work, inclusive of classroom time.

But most Business School men can squeeze in time for other things besides discussions of case problems. Ex-servicemen, one-time fraternity presidents, and all the other varied types which make up the student body blend into a group that takes advantage of 12:30 a.m. weekend room permission, and keeps weekly Chase Hall "set-ups" as well as occasional formal dances on a continuing basis.

The School even boasts a lively intramural sports program. Over a quarter of the students this fall played football, with some sections (class divisions) taking their games so seriously as to operate a two-platoon system.

All these things, from the case method to the two-platoon system, have gone toward making today's Business School a far cry from 1908, the year of the opening.

The whole idea of business at Harvard originated at the turn of the century when the University started taking sharp notice of the rapid expansion of business in the country. First came an experimental course in accounting, and then, in 1907, President Eliot announced the Corporation had voted to set up a School for Public Service and Commerce.

The nation's economic "panic of 1907" made the Corporation promptly decide that anyone except the business man would be too hard to place. So on October, 1908, the Business School alone opened its doors, and 33 students started courses as candidates for the newly-minted degree of Master of Business Administration.

Under its first dean, Edwin F. Gay, the fledging School heard lectures by outside business men and grew from a 33-man class in 1910 to a 156-man class in 1917. But the first world war dispersed both faculty and students, and in 1919 only 68 men were around to receive their M.B.A.'s.

Donham Takes Over

That year Gay resigned to take on the presidency of the New York Evening Post, and Wallace B. Donham left his Old Colony Trust Company vice-presidency to become the Business School's second dean. In his first report Donham hailed his predecessor's ten years of work in launching the School but lashed out:

"The present condition of the Business School is intolerable except as a temporary makeshift. We need funds at once for the construction of buildings to house a School of 1,000 and to develop laboratory facilities."

Since its birth the School had been located entirely north of the Charles, shaving "every week and cranny"-as Dean David puts if today-with the rest of the University. The library occupied part of the top floor of Widener, and classes and offices were sprinkled in Yard buildings, museums, the Unions basement, Lawrence Hall, and University Hall.

It wasn't until March 20, 1924 that the fund drive Dean Donham called for got underway. However, under the late William Lawrence, Bishop of Massachusetts, the campaign was unexpectedly concluded in little more than a month when the late George F. Baker, chairman of the First National Bank of New York, wrote the University offering $5,000,000 if he could "have the privilege of building the whole school."

Alone Baker gave the School grounds as excellent as those of any other graduate school in the country, for his funds bought every permanent building that now stands across the river, including towered Baker Library. In 1925 he added an extra $1,000,000 to his gift when it appeared the original $5,000,000 was going to run out; and only last year an additional $500,000 was received from Baker's estate to keep facilities up to date.

Case System Built Up

Not waiting for the completion of the buildings, Donham had meanwhile been working on his second, goal, that of "expanding laboratory facilities." By 1927 when the grounds were dedicated, eight intensive years of visiting business plants bad blossomed into almost 6,000 case studies. School researchers have kept the case stocks "active" by constantly watching and visiting business to gain not only new case situations but evidence of outdated situations as well.

By the start of the second world war, degrees-awarded figures, starting with the 33 given out in 1910, had cumulated to a total of 7,757. During the war, however, the School cut out all degree awarding, choosing rather to lend its full experience to the war effort.

From May, 1943 (when the last civilians left the School) until February, 1946, Harvard managed to train over 14,000 army and navy officers in the use of supplies, as well as 500 business was who further crowded the School for War Industry Training and Advanced Management programs. This latter program, a 13-week course for executives, continues today, so popular did it prove during the war.

Dean David

Chief man in the School organization today is influential Dean Donald K. David, who is simultaneously a director of such enterprises as General Electric, R. H. Macy's, and the Boys' Club of America. Dean David succeeded Donham, who in 1942 resigned his deanship at the advice of his physician. Donham is now a professor of Human Relations at Colgate University.

Dean David's main concern these days is raising the full $20,000,000 for "stabilizing and consolidating." The full $20,000,000 would endow another classroom building, a social and eating center, and provide an annual income for research and instruction.

The remaining $3,000,000 would set up something entirely new-a much expanded scholarship program to provide "instruction to the country's best-qualified young men without being limited to those fortunate enough to have been born into high income families."

These funds will be crucial when G.I. aid runs out