February 2015 | Strategy
“No function is an island,” explains Kathy Pearson, Senior Fellow, Leonard Davis Institute of Health Economics, University of Pennsylvania. “A business is an integrated unit. You can’t have operations without the customer, or marketing without finance. Operations need to be lean and efficient, for example, but they should be lean and efficient for your customer. What you do in operations should ultimately bring value to the customer.”
Pearson says too few business leaders have what she calls an “enterprise mindset,” one that recognizes the integration and interdependency of every function. It is this mindset that executives in Wharton’s Advancing Business Acumen are encouraged to develop. “It’s not about optimizing your area or product but rather improving the performance of the whole system,” she says. The program, described by Pearson as an “MBA on steroids,” includes sessions on strategic management, financial accounting, market segmentation, talent management, and more, but they are integrated, with a consistent emphasis placed on how each function impacts the others.
Jack Hershey, faculty director of the program, says, “Participants, 40 percent of whom come from outside the United States, are here for the basics of accounting, operations, marketing, strategy, and leadership. Some of them have a strong background in one of these areas, but are looking to round out their knowledge. We provide that, and we also show them how everything works together.”
Hershey says three overarching concepts inform the six-day program. “First, you will get up to speed on business literacy. To communicate across the organization, you need to understand the terminology, much of which can be arcane. What is customer valuation, downside risk, or the winner’s curse? Knowing this language allows you to participate in the discussion no matter who is holding the meeting.
“Second, you will understand the importance of asking the right questions by developing business intelligence. To get the right answers, you need to ask the right questions about your business, your competitors, the environment, your customers, and your non-customers. Why are some people buying your product and others not?
“Finally, we look at decision-making and judgment. You can have the other two, but without the ability to select the right option and bring together thoughts with action, you can’t get very far.”
Pearson teaches Operations Strategy in the program, something she has been teaching Wharton MBA students for the past eight years. “Operations is often seen as purely tactical. But it’s not just about queuing theory and bottleneck analysis. In fact, operations strategy should be completely in line with your business strategy. In Advancing Business Acumen we talk about tactics, but the focus is on the strategic level.”
She says what she enjoys about the program is helping functional experts prepare for a wider leadership role. “They’re here because they want to make that transition. Whether they are from health care, financial services, HR, telecom, pharma, tech, or construction, they know they have to start thinking across the organization. To integrate with everyone else, you have to know their language, know their concerns, and see how it all relates. Every session in the program contributes to that storyline.”
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