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‘We Are Creating a World-Class Business School’

Valery Katkalo on the New Structural Changes in the Faculty of Business and Management


The Faculty of Business and Management is one of three faculties undergoing restructuring this year. Valery Katkalo, HSE First Vice Rector and Dean of the Faculty of Business and Management, spoke with HSE News Service about the ambitious goals that the Faculty plans to achieve during the course of the restructuring. 

How is the Faculty of Business and Management being reformed and why?

— As you know, among the strategic projects stipulated in the 2030 HSE Development Programme is the creation of a world-class business school, which will become a priority partner of leading companies in training a future class of business leaders and developing advanced management technologies.

For 25 years HSE University has offered successful programmes in management and business, which today are concentrated primarily within the Faculty of Business and Management. Now we are faced with the challenge of creating something qualitatively different: a world-class business school.

The main criterion for the success of the Higher School of Business (HSB) will be not only the stellar careers of its graduates, which we always prioritize, but also key international accreditations, which provide entry to the world’s chief business education rankings.

Unfortunately, HSE does not yet have a business school that can boast such international recognition. Russia, however, does have several outstanding business schools that can. These include the Graduate School of Management of St. Petersburg State University and the Skolkovo Business School, which both have EQUIS accreditation and regularly represent Russia in the Financial Times global ratings. In addition, one of the RANEPA business schools has AACSB accreditation.

Our goal is to make a big breakthrough in this sphere, using our vast experience and the huge potential of our interdisciplinary programmes and research; HSE’s strong reputation; and our unique team that has now entered the sphere of business education at our university.

In April, we presented the idea of the HSB to the HSE Academic Council, which then granted approval for its creation beginning September 1, 2020 on the basis of the university model of business education. This support from the entire professional community of HSE has allowed us to assess the feasibility of our plans with great optimism.

Which HSE divisions will be part of this business school?

— The Higher School of Business is being created as part of the restructuring of 11 other HSE divisions. These are the Faculty of Business and Management, nine subdivisions of additional professional education, and the Institute of Innovation Management.

Of course, the restructuring of the Faculty of Business and Management is one of the key elements of the transformation. Since the spring of 2019, when we began to discuss and make fundamental decisions about creating a business school, we communicated with the Faculty staff and emphasized the issues that are priorities in managing the quality of education in accordance with the standards of the above-mentioned international business school accreditations.

I should note that in parallel with these changes, two of our undergraduate programs in Management are now preparing for the most prestigious programme accreditation in the world under the EPAS system of the European Foundation for Management Development (EFMD).

These are all important challenges facing the Faculty staff today. After the decision to create the HSB was made at the April Academic Council meeting, we began to prepare for the structural changes as well for the start of the new academic year, which will require new approaches.

Now we are discussing a lot of these transformations with both teachers and students. Over the past year, my deputies and I have met many times with the Student Council and student initiative groups in order to explain seemingly simple, but critically important things involved in creating a world-class business school.

Academic year 2019/2020
Academic year 2019/2020

What kinds of professional requirements must teachers of the new HSB meet?

— I would like to emphasize three qualitatively important differences of the HSB, which are associated with new professional requirements for teachers and all employees of the Faculty of Business and Management (FBM).

First, we must not only ensure that we create top-notch academic programmes that meet the current demands of the business sector, are innovative in terms of their use of technology, and qualify for international accreditation. We must also foster rigorous research.

Since the 1960s, at the world's leading universities, management has become as full-fledged discipline among the more traditional branches of science and the humanities. In the modern world, in the field of management, there is a developed academic infrastructure comprised of research institutes and laboratories, professional research associations, annual international research conferences, and postgraduate programmes with their own range of specializations.

All this at leading university business schools facilitates a steady output of publications in top-rated journals. Our area has not only the well-known Q1 and Q2 metrics for ranking journals, but also the Financial Times list. This includes the top 50 journals that determine new breakthrough areas in management, and publications in which the FT takes into account the ranking of the world's leading business schools.

Unfortunately, among the teaching staff of the FBM and the future HSB, only two teachers have publications in FT-50 journals, and very few colleagues have publications in Q1 journals on management topics. This is an understandable challenge and a good guideline for understanding what qualification requirements we should set for HSB teachers in the academic track. At the same time, I would like to note the role of teachers and other professional tracks (at HSE we call them ‘educational-methodological’ and ‘practice-oriented’) in the creation of new ‘codified’ (that is, published) knowledge regarding the effective management of business. This knowledge takes the form of articles in leading professional journals, research cases, innovative educational methodological developments, and so on.

Secondly, in today’s world, a most important qualitative marker of a business school is the deep and large-scale internationalization of its curriculum, research, and teaching staff. I will limit myself to mentioning only one of the ways in which we have demonstrated significant progress in this aspect: the FBM has dozens of international partnerships. In order to move forward so that HSE is worthy of global recognition, we must build a network of partnerships with the world's leading business schools, and this also means developing double-degree programmes with them.

We have already begun this work at all levels—the undergraduate level, the graduate level, and in our MBA programmes. We will build such alliances not just with strong partners, but with the best university business schools in the world. This means developing equitable models of cooperation, which involve intensive exchange of students, teachers and mutual recognition of our programmes and diplomas.

One of our big priorities moving forward is the development of English-taught business programmes. So far, we are taking the first steps toward this with three programmes, but we will open new ones and significantly internationalize the rest.

And thirdly, another marker of quality is having a robust corporate network—with both businesses and alumni.  The starting situation here was somewhat reminiscent of the saying, ‘the shoemaker always wears the worst shoes’. In 2020, we created our own professional Career Centre at the FMB for the first time; we’ve begun organizing a single FMB Alumni Association; and we’ve restarted the previously largely dormant network of company departments and academic councils, in which we are involving Russian and international business leaders.

We set a high standard for ourselves. We focus primarily on leading Russian companies from the Expert 200 rating and companies included in the Fortune Global 500 rating.

In light of these goals, we have performed a comprehensive audit of our departments. Some of them have been determined to be ineffective and have been discontinued. At the same time, we are opening new departments and project-research laboratories, such as a new department in risk management with Otkritie Bank and a laboratory focusing on customer experience management in collaboration with the company SAP. A number of other initiatives will be implemented by the end of this year.

Any changes in faculties first and foremost mean changes for the employees. How did you work with your employees and communicate the new challenges?

— In addition to several of my meetings with our entire team of teachers regarding the creation of the HSB, we have introduced annual individual meetings between the dean and each full-time faculty member before the start of each academic year. We had 124 full-time employees as of June 1st of this year. In mid-May, I sent a series of letters to teachers, school heads, and academic programme directors explaining the need for such meetings and what their agenda would be.

These individual meetings were usually attended by four people: the teacher, the dean, the first deputy dean, and the head of the school in which the teacher works.

We discussed the employee’s contractual status, talked about their Research Productivity Assessment results and their Student Teaching Evaluation results, as well as their publication record (i.e., whether they have published research in Q1, Q2, or FT 50 journals). We met with every teaching staff member and evaluated their contract status in light of their productivity and achievements, discussed their teaching load for next year, how it would be organized, and the expected number of classroom hours.

It is important to note that before the start of the 2020/21 academic year, we have introduced a number of changes to course scheduling in terms of the quantity of classroom hours per credit, and we standardized the number of classroom hours included in teachers’ individual annual teaching loads in consideration of their publication records and in accordance with HSE’s general approach to determining yearly teaching loads.

I outlined this change to classroom hour standards and teaching loads in my open letter to the FBM teaching staff. Someone responded with questions for clarification, but it was received very positively by everyone. Some teachers’ classroom hours had been reduced, others were unreasonably overloaded, and others for unexplained reasons had teaching loads that were greatly underestimated. All this was corrected during direct and open dialogues in our individual meetings.

We believe that we are all members of the same team, we make team products, we absolutely take into account all of the University’s guidelines for assigning individual teaching loads, including considerations of programme leadership positions, participation in staff development, and so on. But all decisions regarding classroom hour loads much be transparent and made in accordance with standardized criteria.

This experience turned out to be positive on the other hand. I told my colleagues that they can ask me any questions, and they noted that this is a unique opportunity for them to clarify the essence of the transformations of the FBM, why they are needed in the HSB, how they can participate in its creation, and what exactly is expected of them during these structural changes.

In addition, we also discussed employee’s individual development plans in detail at these meetings. On the night before our meeting, each teacher sent me and their immediate supervisor answers to a certain list of questions that addressed their plans for publication activity, how they will contribute to the development of project-based education, how they will participate in the development of online programmes and courses, and how they will participate in international professional associations. The challenge was to look ahead not only to the next academic year, but also to the horizon of 2022.

Did you also talk with the students about the Faculty’s structural changes?

— Yes, the students asked about how programmes will change and what will happen with specific courses. It is important to remember that this coincided with a number of previous decisions. A year ago, we approved new educational standards for our bachelor's degree programmes in ‘Management’ and ‘Business Informatics’, which will be introduced on September 1, 2020.

Naturally, certain adjustments were made to our new curricula due to our transitioning to new educational standards. We specifically met with the Student Council in June to answer related questions.

You asked earlier about the restructuring of the Faculty. Let me clarify: the reorganization process has not been completed; it is still in progress. Now we must successfully complete the main phase by September 1, and then a new stage of the process will begin. Of our 124 full-time teachers, 24 people will not continue working with us in this capacity. Some of them themselves decided not to continue working full-time: some switched to 50% or 25% appointments, others transferred to other faculties, and others decided to leave HSE. A number of colleagues had contracts that expire on August 31, and some of them were not convincing in outlining their evaluation results and plans for professional development.

Any large-scale restructuring is not easy, we are all learning a lot, but I am convinced that important groundwork is now being laid for the successful implementation of our ambitious plans to create the HSE Higher School of Business.

Research seminar, ‘The Experience Economy’
Research seminar, ‘The Experience Economy’

How will the business school’s structure change?

— The restructuring of the FBM, which will become part of the HSB, consists of three main components.

First and foremost, in the 2030 HSE Development Program, utmost priority is given to project work, not only in programme curricula but in the professional activities of teaching staff.

I think that fact that this restructuring has coincided with our first call for collective research project proposals from our faculty members has had a positive effect. The proposal call was conducted as part of the newly model that was introduced this year; 25% of the Faculty’s budget has been allocated to for these purposes.

We received 40 project team proposals from all schools and most departments, and 22 of them were approved by the Academic Council. Insofar as not all of the 25% of budgetary funds were spent on the first proposal review process, we decided to conduct a second call in early September and evaluate the outcomes. We will thereby give another opportunity for our teachers to further their professional development by forming collaborative project teams.

In our call for proposals, we emphasized the importance of overcoming insularity and creating inter-departmental, inter-school, and inter-faculty teams, and a number of successful applications really distinguished themselves in this regard. We will of course continue to strengthen our focus on this principle.

Secondly, as you know, the Faculty of Business and Management is one of the mega-faculties that were created five years ago. This mega-faculty is the successor of three faculties: Management, Logistics, and Business Informatics. At a new stage in the development of business education at HSE University, the University Academic Council approved the structure of a business school comprised of 6 departments, which are typical of modern university business schools in terms of content.

The name of one of the departments will retain the theme of business informatics, where we are significant leaders and the largest in Russia. Our logistics programmes will continue to grow, but now they will do so as part of the Department of Operations Management and Logistics, insofar as operational management needs to be strengthened as one of today’s key areas of professional management. Departments of Strategic and International Management, Marketing, Organizational Behaviour and Human Resource Management, and Financial Management will also be created.

All teachers will be concentrated in these six departments, including those that, for various reasons, in recent years were not part of the Faculty of Business and Management, although they are leading Russian experts in certain areas.

Now, by bringing together nine key continuing education programmes in business under the HSB umbrella together with the Faculty of Business and Management, we have the opportunity to reunite the highly fragmented landscape of HSE faculty members specializing in management. We have not yet made all decisions regarding the heads of future departments, but I can already tell you that one of our key experts who previously worked in continuing education will head them in the HSB.

We have observed an interesting phenomenon that has resulted from the restructuring. At least 10 full-time teachers who continue to work at HSB have changed their home base. For one reason or another, in three schools there was often an orientation towards self-sufficiency among teaching staff for those programmes that were implemented according to the areas of these schools.

We had almost grotesque situations when a strong specialist in soft skills, teamwork, and leadership for some reason ended up becoming a full-time teacher of the School of Business Informatics. We observed instances of this in other schools as well. It is clear that in the future, such colleagues should be concentrated in the Department of Organizational Behaviour and Human Resource Management.

We also had the opposite situation, where experts in business analytics or information systems were in other schools instead of the School of Business Informatics. To reiterate, we now have 10 cases in which colleagues, as a result of the restructuring, have joined department teams in their area. It seems to me that this is a wonderful opportunity for the further professional growth of these colleagues.

The third component of the restructuring is that we are in many respects creating a new type of faculty. It is an integrated gathering of educational programmes from undergraduate to continuing education, retraining, and Executive MBA programs. Nine subdivisions of continuing education, which are part of the Higher School of Business, will form an intra-faculty educational track of continuing education, which will be of no less importance for the HSB than its bachelor's or master's programs. In fact, this is a significant transition from the concept of a faculty as a structure containing only undergraduate, master’s, and doctoral programmes.

After all, today we no longer perceive the concept of lifelong learning as something in the distant future. A natural question arises: if this is already a reality, then what role should universities, especially leading universities, play in it? Without making generalizations, I want to say that in the field of business education, the world's leading universities have already answered this question for a long time, in part by making organizational and personnel decisions.

At university business schools, programmes from the undergraduate level to the Executive MBA level are all becoming stronger and more fruitful. There are many examples: the Wharton School of the University of Pennsylvania, the Haas School of Business at the University of California Berkeley, and the Oxford and Cambridge business schools that emerged just 25 years ago. All of them have a range of programmes from the undergraduate level to MBA. Of course, they put important strategic emphasis in their programme offerings. We will also make a top priority for ourselves. We will continue to strengthen our bachelor's programmes that continue to be in high demand, but, of course, we will also prioritize the development of post-bachelor's programmes as well.

By the way, we expect that graduates of our bachelor's programmes will continue their education with us at the master’s level. This is a very important task, but a personnel question is also associated with it: who should the teachers of such a university business school be? We believe that leading professors should teach not only in our master's and MBA programmes, but also in our bachelor’s programmes. The opposite is also true: we must understand that teachers who feel very comfortable teaching at the bachelor’s level will become more qualified if they can progress to teaching courses in our master's and MBA programmes.

There is a lot of potential ‘cross-pollination’ between these programmes in terms of a more academic and more hands-on learning approach. Finding the right balance is very important for business education.

July 27, 2020