Harvard Business School

At the beginning of the 20th century, Harvard University’s President Eliot argued that Harvard’s role was to train “doers and achievers.”

But what did that mean, exactly? The United States had recently been through a far-reaching industrial revolution—transforming itself from an agrarian nation to an industrial one—and this seemed to argue for training in business. But at the same time, the U.S. was flirting with the idea of empire. To some at Harvard, this argued for creating a school of diplomacy.

Eliot listened to these debates, and—as he explained to a gathering of Harvard alumni in New Haven in February 1908—weighed in squarely in favor of a two-year graduate course of study in business.

During these debates, Eliot came increasingly under the influence of Professor A. Lawrence Lowell (who shortly would succeed him as Harvard’s president). In the spring of 1907, Professor Lowell was raising money to support the new school, which (as he explained to one potential donor) would attempt to make its graduates immediately more useful by teaching them higher-level business concepts. The name settled upon for the school—the “Harvard Graduate School of Business Administration”—underscored the founders’ belief that there were general administrative principles that ran through all businesses: a startling concept at the time, and one that still stirs debates today. Can an MBA (presumably with some business experience) run any kind of business?

Harvard’s business school sometimes abandoned the high ground of business administration—which it eventually came to call “general management”—especially when the School came under financial pressures. In the first decade of its existence, for example, HBS offered courses in printing, Chambers of Commerce, lumbering and forestry, public utilities operation, fire insurance, and water transportation—mainly because those industries offered to underwrite these specialized courses, and also to send “special students” (non-degree candidates) to them.

Again in the 1930s, HBS considered making a pragmatic departure from educating leaders for private-sector enterprises. In 1934—with industry laid low by the Depression, MBA enrollments plunging, and public-sector employment soaring—Dean Wallace Donham revived the long-abandoned notion of training students for government service. But the founding of the Harvard School of Public Administration in 1935 undercut the School’s rationale for training New Deal administrators, and HBS returned to its predominantly private-sector orientation.

It would be almost six decades before HBS again embraced a significantly expanded definition of “business” and “administration.” This came in the early 1990s, when a distinguished alumnus—John C. Whitehead, MBA ‘47—established the Social Enterprise Initiative, aimed at supporting research and teaching in nonprofit management. In subsequent years, Social Enterprise flourished at the School. In the 1990s alone, 15 new endowed funds (including a 25th Reunion gift from the MBA Class of 1973) were created to support a diverse range of activities under the umbrella of the Initiative. In the early years of the 21st century, the Social Enterprise Club became the most popular student club on campus, and increasing numbers of MBA graduates entered the social enterprise sector.