MANILA, Philippines--Oner of only two international business school accreditation bodies had asked the Asian Institute of Management to let go of some of its aging faculty members if AIM hoped to be accredited by the European Foundation for Management Development-European Quality Improvement System.
AIM was the first Asian graduate school of management to receive the five-year Equis accreditation in 2003. Last year, a team from EFMD assessed AIM's application for reaccreditation.
On March 28, 2008, AIM president Francis Estrada and Dean Victoria Licuanan sent a letter to the AIM Community stating that, on top of the governance issue cited by Equis in its Peer Review Team report, the body cited three other issues the school must address before accreditation could be recommended.
The letter quoted the report: "Currently, the most serious issue at AIM is the deep conflict over governance that culminated in the suspension of the Board of AFA (AIM Faculty Association), in the banning of AFA as a representative negotiation partner of the Faculty in its relations with AIM Management."
According to the letter, the other issues cited in the report were:
Faculty Renewal. AIM needed to hire more young Ph.D.s/DBAs interested in/capable of research and teaching and to reduce the median age of the faculty (Estrada says the average age of AIM faculty is 57.7 years).
Research. There was paucity of quality research produced by the Institute.
Internationalization. The institute lacked faculty members from other countries.
AIM Alumni Association member Ramon M. de Vera, who was privy to the discussions between Equis and AIM, says the foreign group told them: "Your faculty is aging, there are not enough Ph.D.s and the faculty does not write research papers and reports."
According to De Vera, AIM pointed out that this is because the institute's focus is on "practitioners" (AIM professors are encouraged to do consultancies with companies). He says the school's stand is that "there are constraints if you are a practitioner group ... you are not heavy on publishing papers; and AIM values older professors who have more wisdom."
De Vera adds that AIM decided not to pursue the accreditation as Equis' requirements meant firing people.
"If we follow Equis, we will have to fire professors and change this from a practitioner based institution to a purely academic/theoretical one where Ph.D.s are valued more than experience."
But De Vera says AIM is in the midst of changes that are not accepted by some.
"We are changing the structures, reengineering and putting reforms. In the face of reforms, obviously many feel uncomfortable if you change from the left foot to the right foot," he says.
AIM's Estrada, in his letter to the community, stated "the Institute was undergoing a major transition in governance, character and strategy designed to make it more meritocratic and responsive to the new market realities as ... suggested by the Equis review team in 2003."
While AIM is trying to institute changes, management has to deal with internal issues.
Deanship
One issue that keeps on surfacing is the qualification of its current dean.
Some members of the faculty feel that Victoria Licuanan does not have the qualification for deanship.
The Commission for Higher Education Department requires the dean of graduate schools to have at least a masteral degree.
In the interview with the Philippine Daily Inquirer, Licuanan says she is a magna cum laude graduate of Maryknoll College and, after working as a secretary for one year, went on a Fulbright Scholarship to a special "straight to Ph.D. in economics" program.
Licuanan says she passed the comprehensive exams and went back to the Philippines to gather data for her thesis. She met Francisco "Kaiku" Licuanan (former president of Ayala Land Inc.) got married, and was not able to finish her thesis and graduate.
"What I have is a transcript of my grades in Harvard for the three years. Based on that, I am a Ph.D. candidate. I have half a thesis," she says.
In choosing a dean for AIM, a search committee submits a list of names to the Board of Trustees.
The Board picks the dean from the list. Although Licuanan's name was at the bottom of the list, and seven of the eleven committee members did not want her, the Board chose her.
Ernesto Garilao, a member of the search committee, says some of the committee members wrote the Board to state that, although they respected the Board's decision, it must be accountable for its decision.
The AIM alumni support Licuanan.
"The alumni here and abroad support the choice of the Board and respect the competence and integrity and the willingness of Dean Licuanan to undertake the difficult task of being a part of the process of instituting reforms in AIM," says De Vera.
The faculty members of the committee did not want Licuanan. This and other issues led to the creation of the AIM Faculty Association which Garilao, a member, says is meant to "protect the academic integrity of AIM, its faculty development and for faculty protection."
AFA registered with the Department of Labor and Employment as an association, but is not recognized by AIM management as a negotiating group.
Entrepreneurship
Some AFA members feel they are being discriminated and harassed because of their membership.
Another issue that faced AIM was the Master in Entrepreneurship program.
ME was the brainchild of retired AIM professor Eduardo Morato. The concept was a first in the world.
Under the ME, students are the decision makers of the respective companies they represent. There is a guru system where a professor serves as guide to the student-businessman. The course has no exams, but in order to pass, the businessman has to show personal or corporate transformation in the four aspects of a company-operations, finance, human resource and marketing. The thesis or the research project (required in AIM's MBA) is a five-year business plan.
AIM dean Licuanan says the title Masters carries certain academic qualities of the bearer and, for students to earn this, they must undergo some academic rigors such as exams. Morato says the program has been tailored to fit entrepreneurs who do not want IQ to be a factor in their learning. The ultimate test for ME is if the business registers substantial growth in revenues.
The debate did not end, but a compromise was reached: The Asian Center for Entrepreneurship, which runs the ME, was established. It is now owned equally by its five gurus--Morato, Danilo Antonio, Tomas Lopez, Andy Ferreria, and Jay Bernardo--and AIM.
Continuing BusinessMonday's Q and A with Estrada and Licuanan from last week:
Q: Your "letting go" of ME was partly due to your application for EFMD accreditation as some believed ME graduates do not deserve an AIM degree. Now that you have decided not to pursue the accreditation, are you going to extend the ME, considering it provided some needed cash flow to AIM?
Instead of letting go of the program, could not a compromise have been reached between the two parties?
A: There is clearly a role for the innovative ME program within the context of the Philippine SME sector. It however has not proven scalable [to the region] nor necessarily sufficiently broad-gauged to ensure that a person who has successfully run a small business is capable of running a significantly larger company in another industry or market. There are also several recommendations which needed to be implemented in areas such as admissions, evaluation of students, development of gurus and drillmasters and others.
As entrepreneurship is very site/market specific, the nature of the research is most useful in a Philippine context. While some general principles apply everywhere, it is not readily apparent that these cases would be particularly relevant to an Indian, Chinese, Malaysian or Vietnamese entrepreneur.
AIM believes entrepreneurship is critical to AIM's mission and the Asian region. It however believes that the entrepreneurship programs it should promote directly in the future must have a different academic orientation, be scalable and transportable within the Asian region. The Institute is currently finalizing development of such programs, focusing on family business structures and innovation. The programs are to be launched at a conference entitled "Entrepreneurship and Innovation in a Complex World" to be held on May 30 at AIM.
Q: What programs are you going to adopt now with this development?
A: AIM will launch its initial round of Entrepreneurship and Innovation programs on May 30. One of the programs will be an MBA with an Entrepreneurship major, and the other would follow an EMBA format to accommodate practicing entrepreneurs.
Q: It seems to me we have the country's management school beset by fundamental management issues? The animosity between some faculty members and management can never be healthy, what is being done about it?
A: AIM had, in the past, been a faculty-run institution with a large number of decisions being made by faculty (i.e., "committee") vote. At the time AIM was established in 1968 and during its early years, that governance paradigm was workable. In fact, probably it was the optimal way to run the Institute. However, as the Institute grew and its program offerings and faculty became more diverse, that method would no longer apply.
Changes in the market place were occurring rapidly and the Institute was required to respond quickly, decisively and consistently with a singular strategic focus. More importantly, dramatically increased competition required a major change at AIM-from a homogeneous, collegial culture to a strong, demand-driven, performance-based culture.
As in most major organizational transformations, there is, and has been, some pain.
We are however convinced that, in the end, AIM will emerge stronger and much more capable of dealing with the unforgiving challenges of globalization. Put another way, not changing would mean an almost certain slide to mediocrity for the Institute.
In its simplest terms, extensive efforts have been made to:
a) Strongly engage the different stakeholders;
b) Formulate a strategy that is predicated on taking advantage of AIM's knowledge and first-mover advantage in the most dynamic economic region in the world;
c) Formulate major changes in policy designed to make the Institute far more performance-driven;
d) Invite faculty who agree with the strategy to support it and the changes they imply; and,
e) Offer those that do not agree, the opportunity of "getting off the train."
More specifically, the AIM strategy seeks:
- To develop graduates that are best prepared to deal with the challenges and opportunities created by a rapidly integrating region.
- To be acknowledged as the graduate school of management that knows Asia best.
- To re-establish AIM's position as the leading, practitioner-oriented graduate school of management in Asia.
- To be the preferred Graduate School of Management for anyone operating, or intending to operate, in Asia.
