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Administration Launches MBA Service Leadership Fellows Program

Last Wednesday, the Dean’s Office and the MBA Program launched a major new initiative to drive more MBA graduates into the social sector. Under the new Service Leadership Fellows Program, Harvard Business School will subsidize $80,000 salaries for graduating MBAs to serve in high-impact government or not-for-profit positions for at least one year. The administration hopes to create up to 25 such positions.

The launch in Spangler Auditorium was an HBS star-studded affair that included remarks by HBS Dean Kim Clark, MBA Dean Carl Kester, University Professor Michael Porter, Initiative on Social Enterprise (ISE) Co-Founder and Marketing Unit Head Professor Kasturi Rangan, MBA Program Executive Director Steve Nelson, and ISE Director Stacy Childress.

The idea was reported to have started in conversations at the end of last year between Dean Clark, Dean Kester, and Prof. Porter. In his opening remarks, Dean Kester said when Prof. Porter originally presented the idea last fall, “we knew we had a real winner from the start.”
The administration has been acting aggressively to implement the idea and has already lined up at least seven organizations as part of the program. These include The Initiative for a Competitive Inner City, the Lower Manhattan Redevelopment Corporation, the Boston Mayor’s Office, Boston Community Capital, the Governor’s Office of Mississippi, the International Rescue Committee, and the Brazilian organization Comunidade Solidaria.

Other organizations are still being pursued, and Dean Kester told the audience Wednesday that the program is being positioned as a global one, wherein students of any nationality can work in a position in any nation where one is offered. The school will also pursue opportunities in concentrated regions where a number of students express interest. Early feedback from students will play a critical role in the development of the program.

The presenting faculty acknowledged constraints that often discourage graduates from entering the social sector, namely the prohibitive costs due to debt loads at graduation and “finding the right positions,” those with access to high level leaders in major organizations and governments. This program is designed to overcome both hurdles by providing a competitive salary and by drawing on the school’s powerful alumni base to find high level positions with potential for significant impact.

In an interview with The Harbus, Dean Kester explained that the funds for this program are originating from general endowments and not from a restricted source or particular donor. He said these general funds could also be used in construction projects, information technology, or any other type of development project one could see around campus. “But this struck us as a particularly worthy project to launch,” he said.
Dean Clark presented a brief keynote address Wednesday in which he said, “As I go around the world today and meet with our alumni, I’m often struck by how many challenges and problems our alumni are engaged in all across their societies, in all sectors.” He noted that many of the key leaders in the New York Lower Manhattan Redevelopment Corporation are HBS alumni, including the famed HBS alumnus John Whitehead, a primary founder of and adviser to the ISE.

In his remarks to the Spangler audience, Prof. Porter stressed the long-term commitment of the school to this program. “Let me be clear,” he said slowly and articulately, “this is forever.” Dean Kester further stressed this commitment in his interview, adding that “the school is putting its money where its mouth is in terms of its mission,” which includes a commitment to create leaders who contribute to the well-being of society.

Prof. Porter, famous for his research and publications regarding competition and society, and one of only four HBS faculty ever to have received the distinction of University Professor, said the idea was “natural for me to think about at this particular moment in history,” and argued that “the role of the leader in business has changed” in modern society.

Prof. Porter said that increasingly, business leaders are finding they “must play a role within government, in influencing government, and in shaping government,” and added that many business leaders today spend 30% to 40% of their time working with the government and social sectors. “So this should be part of your training as a leader,” he argued.
Furthermore, as the limits of government become more “correctly understood,” said Prof. Porter, the importance of the not-for-profit sector increases substantially. Many of those organizations, he said, are already “central to the success of our societies.”

In his impassioned remarks, Prof. Rangan noted that traditionally one to
two percent of those admitted to HBS expressed in their applications an interest in entering the social sector, however only around fifteen MBA graduates actually enter the sector each year. He joked that at annual ISE advisory meetings, John Whitehead seems to chide the ISE leaders with questions that sound like “How can you mess up like this?” Prof. Rangan hopes this new program will help increase annual yields to the social sector, and all the presenters noted the potentially huge impact the program could have in governments and societies around the world over time.

Prof. Rangan argued that HBS graduates can add tremendous value to the social sector and that current research is showing a broad lack of strategic thinking in not-for-profit organizations of all sizes. He said not-for-profits often get lost in the scope of their mission, and HBS graduates can act as “catalysts” in these organizations to create high impact change. He also emphasized the importance of the ability for MBAs to step back into the private sector after a year of service in the program, if they wish, “having been sensitized to the needs of the social sector.”

In his interview, Dean Kester said that a critical near-term impetus for the new program was the aftermath of September 11th and the clear anecdotal evidence that a broad segment of the student body is “fundamentally rethinking their lives and personal values” as a result. Dean Kester said the evidence made him, Dean Clark, and Prof. Porter think “maybe this really is going to be a new era” that will lead to sustainable “new and different ways to make a difference in society.”
However, he added that even without the events surrounding September 11th, this program “would have been done because it’s just so consistent with our mission and what we think leaders need to learn about in order to be effective in the for-profit, not-for-profit, and public sectors.”
Students who wish to apply to the program should watch for e-mails from Dean Kester and a new link on my.hbs where they can upload their resume and a cover letter for specific positions. Graduating students who already have job offers they want to accept are eligible if they can negotiate a deferral with their employer. Interested ECs should continue to monitor the site for new opportunities and developments. Applications will be accepted on a continuing basis.

“The major constraint is now not the money and it’s not the opportunities. It’s how many of you are actually willing to make this commitment, early in your careers, when you have the focus and the energy to do it,”concluded Prof. Porter.

February 19, 2002
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