Sal Sodano, former chairman and chief executive officer of the American Stock Exchange (Amex) and vice chairman of the National Association of Securities Dealers (NASD), possesses a deep interest and appreciation of business education. He served as Dean of Hofstra University's School of Business from 2006-2010. He remains active at the university as the Senior Executive Advisor to the President and the Arthur Sorin Distinguished Teaching Fellow in Business.
Following is a conversation he had recently with Richard Torrenzano:
Richard Torrenzano: Why the renewed focus today on business education?
Sal Sodano: Simple: What may have been okay a few years ago obviously is not okay today. There needs to be a new mindset as to how we look at challenges, how we lead in today's environment, and quite frankly, how we come up with new ideas to become successful in today's environment.
With the change in the environment and all the failures, certainly in the financial services industry, we have to reexamine what potential leaders and managers need, in terms of tools to be able to lead in today's economic environment.
RT: Do businesses and business schools need to communicate better?
SS: For a business school to really be successful they have to balance traditional academics with business practitioners. Many business schools do not openly embrace practitioners in the classroom as teachers. There has to be a better balance between academia and practice. Schools ought to employ the executive-in-residence concept, using someone who is viewed as successful in what they do in business. Have someone spend a semester, even a year or two in the school, working with the faculty to give them a better understanding of what is happening currently in the business world, and more importantly, get them in the classroom. Let the students have access to real decision-makers and achievers.
RT: What important skills do today's MBAs need to learn?
SS: Clearly all the traditional blocking and tackling skills, such as finance, accounting and marketing will never go away. Those are the basic building blocks of how business works. The soft skills, the skills that will help someone climb the ladder and become more successful, the ability to communicate effectively, be a team player, and motivate people, those need to be emphasized.
There are very few schools right now that focus on the soft skills as part of the curriculum. We're just now focusing on a formal approach to bringing these soft skills into the curriculum, so that when someone has completed their graduate program it's not just a technical program. Then they will have a complete portfolio of skills.
Our Management Department and I try to get students to understand there's a big difference between teaching management and teaching leadership. You can manage and not be a good leader. You can lead and not be the best manager. They're not the same thing. The goal is to blend those two concepts into one person. An outstanding leader is someone who can motivate, take charge, someone people want to follow and hopefully manages well.
RT: Let's talk about the Zarb School of Business at Hofstra. What did you do there that was new and innovative? How is that helping an MBA student get a job and be better positioned for that job?
SS: We anticipate what direction and curve business is taking to provide programs for students so they're ready to take advantage of those opportunities.
For example, we have new programs such as an MBA in Sports and Entertainment Management. There aren't many of those around. We think there will be some opportunities in those fields coming up, so we have put programs in place within the past few years.
A perfect example of trying to anticipate and be ahead of the curve is a program that's gaining traction at the university now. We have a Master of Science in Quantitative Finance. It sounds pretty fancy. It focuses on quantitative methods, math and statistical analysis in the understanding of finance. Now what does that mean?
It means students who complete this program will be very qualified to do what's required not only in a Wall Street type job, but in government regulatory agencies, risk management industries, compliance officers, as well as a trader dealing with whatever security or commodity you're interested in.
RT: You have a trading floor at Hofstra?
SS: We have the largest, most sophisticated, Bloomberg-based trading floor of any college campus anywhere in the world.
We have 35 trading posts, access to the latest information in all the markets like equities, fixed income, commodities, and money markets. We have mock trading systems built into our trading room with professional money managers and traders from Wall Street who work with our faculty and students, perform trading contests and mock trade programs right in the business school.
When our students compete in open outcry and electronic trading they regularly rank as the top 10 students in the country. The reason is the competency of our faculty, as well as the success of our alumni in the Wall Street world and their ability to be on the campus trading floor with our students. This is world class, so you put that all together and it's a tough combination to beat.
RT: Executives complain about MBA's graduating business school as weak writers. Do you agree with that and are you doing anything to address this issue?
SS: I absolutely agree with that and I think it has to do with two main factors. Today's generation is very different, in terms of communications style, than current business leaders. We would write memos to communicate with one another. We would be in front of each other with eye-to-eye, communications, but students today live in a world of the iPhones and tablets, and texting.
The language is different and the words are different. The ability of students to be at ease with someone face-to-face is markedly less because they just don't do it. Leaders today are concerned that the new graduates are not as comfortable and capable in all aspects of communication; primarily because young kids text.
On top of that, the outstanding graduate education that's in this country has given rise to a huge influx of students from other countries enrolling in U.S. graduate programs. That, in and of itself, gives rise to cultural differences. Their command of the English language may not be as strong. All these can cause significant challenges for students entering today's job market and their employers.
RT: How much demand do you see for MBA law degrees?
SS: Not as much as you would think. You would think that everyone, including attorneys, would want to have the best skill set to make them the most valuable to their firms. You want to round out your legal education with a business education. There is a program that does exist currently, but we have only seen modest growth in that area.
RT: There have always been MBAs in the entrepreneurial world. With the lack of demand for jobs in the corporate arena, as well as the problematic job market, is there more interest in entrepreneurship?
SS: That is an absolute and very positive trend we are seeing right now. The Entrepreneurship Program at Hofstra continues to grow. It's actually the fastest growing program in our business school. More and more students are interested in working for themselves, starting their own business, being a sole proprietor.
As a matter of fact, in a class I taught I asked students that question and to my amazement more than one-third of them told me they were going to work in their family businesses or start their own.
That is vastly different from when I graduated in the late 70s. You almost automatically assumed everyone who graduated was going to Wall Street or a company like IBM. It's a very different mindset today. Young students see a lack of loyalty in employers, and in many instances, the harshness of economic realities where you can just be cut without reason or loyalty. Many people are not happy with that, or quite frankly; do not want to be involved in that type of environment.
RT: As you look out over the next three to five or seven years at the better business schools in this country, what are the surprises you're going to see?
SS: You're probably going to see a change in mindset from purely professional training.
You'll see more integration of pure, analytical thinking skills, almost the type of skills you would develop in a liberal arts school by taking general type courses that develop your curiosity and your general analytic ability. Without a doubt, there needs to be a lot more work done on the interpersonal skills, communication and team work.