Top Global Business Schools

A classroom at INSEAD, a French business school that landed atop Bloomberg Businessweek's 2010 ranking of international MBA programs for the first time since 2002.

By Alison Damast

Pablo Garcia-Morera had almost everything in place he needed to launch a career in Spain after graduating from IE Business School (IE Full-Time MBA Profile) this past December. Though he is Filipino, his family owns an apartment in Madrid and he holds a European Union passport. All he needed to stay in Spain was a job, but finding one proved to be harder than Garcia-Morera, who worked as an account manager at Pepsi Philippines before getting his MBA, could ever have imagined. He spent the six months following graduation applying for dozens of openings in Spain, which has the highest unemployment rate in Europe, with little luck. His hopes rose when he landed interviews at Unilever's (UN) Barcelona office and Johnson & Johnson (JNJ) in Madrid, but neither opportunity panned out.

"The job market actually ruined my plans, and by May I had to give up and go back home," said Garcia-Morera, 30, who returned home to the Philippines to work as head of sales for his family food importing business. "It was disappointing because working in Europe would have opened new doors, but it was hard to even find an opening available."

Recent graduates from Bloomberg Businessweek's 10 top-ranked international business schools continue to be hit hard by the ripple effects of the global financial downturn, with an increasing number of students like Garcia-Morera resorting to their plan B or returning home after fruitless job searches in Europe. This year's still shaky market for MBA talent in Europe and Canada shook up this year's international ranking, with France's INSEAD (INSEAD Full-Time MBA Profile) taking the top spot.INSEAD climbed two spots since the previous ranking in 2008, pushing Canada's Queen's School of Business (Queen's Full-Time MBA Profile) out of the top slot.

With jobs scarce, recruiting relationships shifting, and student anger at a boiling point, two newcomers to the top 10—No. 9 York University's Schulich School of Business (Schulich Full-Time MBA Profile) and No.10 University of Cambridge's Judge Business School (Judge Full-Time MBA Profile)—were able to elbow their way onto the list. On average, one in seven recent graduates, or 14 percent, were still without a job three months after graduation, according to placement data from the seven top-10 schools that reported it.

The hiring outlook in Europe remained challenging for the most recent group of MBA graduates, especially in countries still reeling from aftereffects of the financial crisis, said Nunzio Quacquarelli, managing director of QS Quacquarelli Symonds, a London company that organizes the annual QS World MBA Tour. "Europe is having a slow recovery and, if anything, countries like Spain, Greece, and others are not recovering yet," Quacquarelli said.

Despite the bleak economic outlook, business schools in Spain have still managed to hold their own in this year's ranking, with IE Business School and ESADE taking the third and fourth spots, respectively.

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How Business Is Adopting Design Thinking

By Venessa Wong

When the best and brightest managers from GE (GE) attend the company's Crotonville learning center in Ossining, N.Y., for the Technical Leadership Development Course, they start by reading a comic book. For many of the handpicked participants, this is their first, uncomfortable encounter with design. They're stretched further over the two-week training as they're asked to decribe their toughest problem in a haiku and draw workflow and patient experience maps.

For Lawrence Murphy, the chief engineer of global design for GE Healthcare who leads the sessions and helped start the program, the goal is to equip employees with new problem-solving tools to help the company evolve to "imagination at work" from its focus on operations efficiency tool Six Sigma.

Managers looking to build design thinking throughout the organization can learn valuable lessons from pioneers such as GE Healthcare, Procter & Gamble (PG), and Philips Electronics (PHG). In addition to hiring design thinkers from schools, they have developed in-house programs to bring people—from all functions of the organization—to think through this lens.

Elevating design has boosted innovation and the bottom line at companies like GE. According a 2003 report by the Danish Design Center, increasing design activity such as design-related employee training boosted a company's revenue on average by 40% more than other companies over a five-year period. But the transition can prove difficult, and trying to convince experienced managers of the value of design-led innovation can lead to dead ends.

"We warn them that they'll be uncomfortable," says Peter Coughlan, who co-leads the transformation practice at design consultancy IDEO. "I tell clients you won't understand it until you experience it." Changing a company's culture can take years, he says, but the quickest route is to get managers to think about themselves as designers of their own organizations, which will help build support at all levels.

The trick, says Cynthia Tripp, marketing director for global design at P&G: "Don't turn it into an education program. Turn it into a problem-solving machine." Tripp has worked for the company for 21 years and approaches her own work with the same attitude. "Design education is not what we've been doing," she says. "I am trying to grow the business."

P&G operates offsite design thinking workshops that bring together employees from across the consumer-products giant, including R&D, market research, and purchasing, to use design methods such as visualization and prototyping to solve real problems for the company. The workshops, run around the world by volunteer employees called facilitators, last anywhere from a half-day to a week.

The program began in 2005 as part of former Chief Executive A.G. Lafley's Design Thinking Initiative, launched in 2001, and was led by Claudia Kotchka, former vice-president for design innovation and strategy. Although Kotchka retired last spring and Robert A. McDonald took over as CEO on July 1, company executives say that P&G plans to conduct more workshops and build design thinking into more activities.

In the past year, the number of facilitators grew to 175 from 100 and design thinking has started to spread organically, Tripp says. P&G offices in Latin America, Europe, and Asia are also starting workshops.

P&G measures the performance of design-thinking inspired ideas and products, says Tripp. In those terms, "We're beating our success criteria. Quantitative measures show we're doing very well."

Robert Schwartz, formerly associate director of P&G's Global Design Organization, is bringing some of this knowledge to GE Healthcare, where he has been general manager of global design for the past two years.

To nudge employees to use these creative skills, Schwartz says, GE measures and rewards them not only on what they achieved but also how they achieved it, based on "growth traits" such as clear thinking, inclusiveness, and imagination. When these traits become used more widely, "the results in the marketplace are remarkable."

The focus on design-led innovation helped Philips Lighting to transform itself over the past decade from a company that simply pushed products into the market into one that designs them with customer desires in mind, says CEO Rudy Provoost. His business, for example, is no longer just about light bulbs, but about designing ambience for consumers. Provoost says the company hopes to provide the bulbs and software to enable consumers to be their own lighting designers.

To support this culture, the company created the role of chief design officer, now held by Philips Design CEO Stefano Marzano, to participate in strategy discussions. Also, Philips Design employees lead workshops that involve case studies and project work about "high design," the company's term for its product development process, which integrates design into other functions such as marketing and technology and focuses on the end user. "We employ disciplines as diverse as psychology, cultural sociology, anthropology, and trend research, in addition to the more conventional design-related skills," says Heleen Engelen, Philips Design's senior design director for lighting.

Certainly, design thinking is not the only mechanism these corporations use to achieve growth. But for now, says GE's Schwartz, "if there's a box of crayons, we're a favorite color."

Wong is a lifestyle and real estate reporter for Bloomberg Businessweek.

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The Big Business of Synthetic Highs

Jamie Chung for Bloomberg Businessweek

By Ben Paynter

It's a Friday afternoon in April, and Wesley Upchurch, the 24-year-old owner of Pandora Potpourri, has arrived at his factory to fill some last-minute orders for the weekend. The factory is a cramped, unmarked garage bay adjoining an auto body shop in Columbia, Mo. What Upchurch and his one full-time employee, 21-year-old Jay Harness, are making is debatable, at least in their eyes. The finished product looks like crushed grass, comes in three-gram (.11 ounce) packets, and sells for about $13 wholesale. Its key ingredient is a synthetic cannabinoid that mimics tetrahydrocannabinol (THC), the active ingredient in marijuana. Upchurch, however, insists his product is incense. "There are rogue players in this industry that make the business look bad for everyone," Upchurch says. "We don't want people smoking this."

From the outside the place looks abandoned. The only sign of life is a lone security camera. Inside, two flags hang above a makeshift assembly line. One shows a coiled snake and reads "Don't Tread On Me." The other has a peace symbol. The work space consists of a long, foldout table containing a pile of lustrous, green vegetation, a pocket-calculator-size electronic scale, a stack of reflective, hot-pink Mylar foil packets, and a heat sealer. Each packet has the brand name, Bombay Breeze, and is decorated with a psychedelic logo featuring a cartoon elephant meditating among abstract-looking coils of smoke and stars.

Upchurch supervises as Harness weighs out portions of the crushed foliage, dumps it into a packet, and slides the top through the heating machine to create an airtight, tamper-proof seal. He finishes about a dozen in 10 minutes, topping off what they will need for their deliveries: two shipments of more than 1,000 packets each. Upchurch points to a disclaimer near the bottom right-hand corner of each package that reads, in all caps: "NOT FOR CONSUMPTION." Says Upchurch: "That's to discourage abuse."

His protests and disclaimers to the contrary, Pandora is getting smoked—it's being packed into bongs and reviewed on sites such as YouTube (GOOG)—for its ability to alter the mind. Like many others, Upchurch is repackaging experimental medical chemicals for mainstream store shelves, most often with some clever double-entendre in the branding. He says he sells about 41,000 packets a month, delivering directly to 50 stores around the country and shipping the rest to five other wholesalers, some of whom use Pandora's products to create their own brands. Upchurch says he ships mostly in bulk orders for larger discounts. He projects his company will earn $2.5 million in revenue with $500,000 in profits this year, depending on what federal and state laws pass. "I think my business model is based less on charts than it is on guts, or something," he says.

"Incense" such as Upchurch's, along with "bath salts" and even "toilet bowl cleaner," have been popping up at gas stations, convenience stores, "coffee shops" that don't sell much coffee, and adult novelty stores. Today, Upchurch's shipments—he uses UPS (UPS)—are headed to places called Jim's Party Cabin in Junction City, Kan., and the Venus Adult Superstore, in Texarkana, Ark. Instate, Upchurch sells to Coffee Wonk, a coffee shop in downtown Kansas City, Mo. There, 28-year-old owner Micah Riggs writes the names of his offerings in multiple colors on a dry erase board near the register. The packets themselves are kept beneath the counter. While Riggs doesn't mind his customers talking about how they will use the incense, he's as circumspect about what he is actually selling as Upchurch. Nearly everything he says is in code. He'll say things like, "Is this your first foray?" and "There are different potencies of aroma."

Customers report different reasons for trying Riggs's products. Some say they need to pass a drug test; synthetics do not show up in standard tests. Others are businessmen in khakis who like the idea of buying from someone they trust. Riggs claims to sell mostly to the military, soccer moms, teachers, and lots of firefighters. "I don't tell people what to do with it," Riggs says. "This is a marketer's dream. I underpromise and it overdelivers."

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To Launch Your Business, Embrace Risk-Taking

By Monica Mehta

To evaluate the merits of their startup dream and strategize about its future, aspiring entrepreneurs can sweat out business plans and huddle with experts. To prepare for the emotional roller coaster of venturing out on their own, though, there's little to do in advance. They must launch and learn on the fly. For those struggling to decide when to launch, insight from seasoned risk-takers and researchers who study them could speed the decision-making process.

For Andrew Ullman and Hayward Majors, co-founders of New York's CollegeSolved.com, an online expert network for college admissions, taking the leap did not come easily. After hatching their idea in 2008, they kept their day jobs in corporate law and finance, conducting research and seeking industry input in their spare time. By February 2009, they had a well-researched business plan but lacked the confidence to pursue the venture full-time. "Despite having an opportunity in hand and some financial stability, it took the validation of creating a beta version of the website and raising capital from outsiders to get us comfortable with the [lifestyle] change," says Ullman.

Like countless others before them, Ullman and Majors were adept at identifying risks but hadn't learned to take them. "When it comes to taking risks, knowledge is a highly overrated motivator. Otherwise, we'd all buy low and sell high, and our kids would eat their vegetables," says Dr. Frank Murtha, a behavioral psychologist in New York City who works with traders and specializes in financial risk-taking. He suggests that seizing opportunities when they arise and rolling with the punches requires a skill set few have mastered.

In 2008 researchers at the University of Cambridge studied the risky decision-making abilities of entrepreneurs and corporate managers with similar IQs and experience levels using a battery of neurocognitive tests. They found (paywall alert) that the entrepreneurs consistently took riskier bets. The results show that risk-taking is both behavioral and physiological. The entrepreneurs not only scored higher on personality tests that measure impulsivity and flexibility; they also experienced a chemical response in the reward center of the brain that the managers did not.

While we have little control over our natural programming, it is possible to change behavior over time, as most therapists advocate. To offer aspiring entrepreneurs steps to take immediately, I compiled these tips:

Socialize with other entrepreneurs. Entrepreneurship rubs off. A study from Babson suggests that children of entrepreneurs are more likely to start businesses, as are those who know other small business owners. The inverse also holds. Risk aversion can be contagious, as Ullman and Majors experienced. "We always wanted to be entrepreneurs, but we were locked into lucrative jobs that were deemed acceptable by family and friends," says Majors. Most large cities offer business meet-ups and other networking events where like minds gather.

Set yourself up for small successes. "Our brains are motivated by success to greater success," says Dr. Richard Peterson, a psychiatrist and PhD of neuroeconomics who has written two books on financial risk-taking. Immediately after experiencing a victory, our neurons process information more effectively, we become sharper and learn faster. Set small goals, no more than three months in length. Even incorporating a hobby that sets you up for small successes can make a difference in your professional life. A personal aside: I've just given hubby the license to play World of Warcraft to sharpen his risk-taking prowess.

Have a whiskey sour. Who hasn't attended a cocktail hour feeling intimidated by a room of unfamiliar faces? A drink can stimulate the impulsive side of your brain's reward center and give you the courage to strike up a conversation. More isn't always better when it comes to playing with brain chemistry, of course. For purposes of productive impulsivity, stick to just one.

Or skip the drink and try channeling your inner Richard Branson on your own. We are groomed to seek information when making decisions. Break the habit by practicing by yourself in an environment where your decisions will have few meaningful consequences. Order what instantly comes to mind in a restaurant, for example, then graduate to other arenas.

Have faith. "As much as knowledge is overrated, religion is underrated," says Murtha. Taking a leap of faith is something every entrepreneur must do at some point or another. Having faith that everything will be O.K., whether it is derived from a spiritual belief or elsewhere, contributes to the willingness to be adaptable.

Choose a partner who possesses skills you don't. If impulsivity and adaptability aren't your strong suits, find a partner who already has what you don't. Of course, don't bring on a partner unless he or she adds value to the project beyond being able to roll with the punches.

Ullman and Majors quit their day jobs in September 2010 when it became clear investors were willing to commit. They closed the round in December, raising enough from friends and family to sustain the business for about two years, and finally launched CollegeSolved.com in early April. "After more than two years of planning, we thought we'd experience a huge relief post-launch," says Majors. "But the party is only getting started."

Monica Mehta is managing principal of investment firm Seventh Capital in New York City. She has advised hundreds of small businesses over the past 15 years. Follow her on Twitter @monicamehtanyc or read more of her writing at monicamehta.com .

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