Transforming Business Schools for the Digital Age

• From declining demand for traditional education to growing concerns about graduate readiness, pressures are converging into a crisis for business schools that they cannot resolve with reactive, isolated reforms.
• Transformation requires coordinated actions across seven interconnected dimensions—ranging from faculty incentives and operational processes to industry alignment and cross-disciplinary innovation.
• These dimensions, which make up our PHOENIX framework, can guide schools as they embed continuous change into their cultures, structures, and strategic decisions.

 
Disruptive technology, financial uncertainty, geopolitical volatility, and social change have transformed the mahogany-paneled dean’s office from a sanctuary of measured academic progress into a war room. Spreadsheets tracking plummeting applications compete for attention with urgent emails from corporate partners questioning graduate readiness. Reports of faculty resistance to change circulate in departmental corridors.

Welcome to the reality of modern business school deans. They face a perfect storm of pressures that are fundamentally disrupting the century-old model of business education.

A Global Crisis

Deans worldwide are grappling with an unprecedented convergence of challenges. How can business school leaders navigate them as they lead their institutions forward?

The two of us recently conducted an extensive analysis of transformation initiatives at diverse business schools to discover patterns and characteristics that distinguish successful transformation efforts from failed attempts.

We identified four critical forces reshaping the global business education landscape:

An application exodus. Applications to many traditional business programs are declining globally, as more students question the return on investment for these programs when online options offer faster, targeted skill development.

The skills gap. Companies report graduates lacking practical problem-solving abilities. “They can analyze case studies brilliantly,” one recruiter from a Fortune 500 company told us, “but when faced with real messy business problems, they’re lost.”

Disruptive forces represent an extinction-level event for business schools that fail to adapt.

AI disruption. Analyses that once required hours for humans to complete now can be generated in minutes using artificial intelligence. AI’s capacities fundamentally undermine the importance of skills that business education has typically emphasized.

Faculty misalignment. Encouraged by incentives that reward faculty for theoretical journal publications, many professors advance their careers by conducting research that rarely touches real business problems. Industry-relevant teaching innovation often goes unrewarded.

Together, these forces represent an extinction-level event for business schools that fail to adapt. Yet our research revealed something surprising: Schools that approached transformation systematically, rather than reactively, not only survived but thrived.

The most successful schools employed what we identify as institutional change theory. This term refers to the understanding that complex organizations such as universities don’t change through single interventions but require coordinated movement across multiple interconnected systems.

Our Blueprint for Transformation

The results of our analysis pointed to the need for a structured, holistic approach to transformation. Guided by institutional change theory, we developed a comprehensive framework, called PHOENIX, to help business schools navigate disruption. Like the mythical bird, PHOENIX enables schools to rise from traditional education’s ashes into something more powerful and relevant.

The framework encompasses seven critical dimensions that determine whether business schools thrive or merely survive in the digital age:

P—Preparedness for change. High-performing schools share common characteristics: leadership that is aligned across governance levels, flexible organizational structures, and dedicated change management resources. Most important, they address institutional resistance head-on rather than hoping it disappears. We observed that schools that score low on preparedness struggle with the later implementation phases of their strategic plans.

H—Human capital transformation. The traditional “publish or perish” model of faculty professional development is based on incentives that often are disconnected from market needs. In contrast, the best schools in our sample had evolved toward more balanced reward systems that recognize teaching innovation and industry engagement alongside research excellence. Sustainable change requires measured evolution, not revolutionary upheaval.

O—Operational excellence. Schools that adapt well to disruption address internal processes, quality assurance, financial sustainability, and decision-making efficiency. They implement rigorous outcomes assessment, develop diverse revenue streams beyond tuition, create streamlined processes that enable responsive adaptation, and respect shared governance.

E—Environmental support. Business schools exist within university systems, regulatory frameworks, and competitive landscapes that can determine the scope and pace of transformation. Schools that make progress develop productive relationships with university leadership, navigate accreditation requirements creatively, and position themselves strategically within competitive markets.

N—Network integration. Schools that engage in effective transformation focus on deepening a select set of substantive partnerships—spanning organizations, alumni, and other institutions—rather than maximizing superficial connections. Quality consistently trumps quantity in robust network strategies.

I—Industry alignment. Business schools with strong industry alignment create deliberate, systematic opportunities for students to engage in applied problem-solving that go far beyond interactions with occasional guest speakers. These schools incorporate multiple industry touchpoints throughout their curricula while maintaining academic integrity.

X—Cross-disciplinary innovation. The most adaptable schools work across traditional academic boundaries, incorporate emerging technologies, and develop innovative learning approaches. Success here often correlates strongly with human capital transformation, as incentives significantly influence faculty’s willingness to undertake cross-disciplinary work. For many schools, pilot programs provide the safest entry point for this type of innovation.

Our framework recognizes that institutional change is multiplicative rather than additive. Weakness in a single area can significantly constrain overall progress, even when other dimensions show strength. The best transformation requires systematic attention to all seven dimensions simultaneously.

From Theory to Practice

After we launched the Woxsen School of Business in Telangana, India, in 2014, we encountered the same transformational struggles that face business schools worldwide. So, in 2024, we began a universitywide effort to respond to digital disruption and changing employer expectations.

Raul Villamarin Rodriguez, Woxsen’s vice president and a co-author of this article, led the research effort that became the PHOENIX framework. Hemachandran Kannan, vice dean and second co-author, translated these concepts into real outcomes and provided a roadmap for implementing a strategy for continuous adaptation.

As a newer institution, our school was not burdened by decades of entrenched practices. Rather than copy established models, we had an opportunity to design a school for the digital age from the ground up. Still, we needed a systematic approach that allowed theory and practical application to enhance, not compete with, each other.

We started with faculty recruitment and development. Instead of hiring only traditional academics or only practitioners, we created teams combining both perspectives. Faculty were rewarded for engaging with industry as they pursued research excellence.

Rather than copy established models, we had an opportunity to design a school for the digital age from the ground up.

Perhaps most critically, we embedded industry partnerships into the core curriculum rather than treating them as add-ons—we wanted companies to be genuine partners, not simply superficial sources of guest speakers and job placements.

We established deep relationships with companies across sectors, from traditional manufacturing to technology. This effort led to company-sponsored capstone projects, faculty-industry research collaborations, and curriculum advisory boards made up of both academic and business leaders.

One of our most significant hurdles was creating a culture that encouraged faculty to embrace this integrated approach. Some academics worried that an industry focus would compromise traditional scholarly standards, while some practitioners questioned whether academic frameworks added value.

Our solution was to create structured opportunities for mutual learning. We paired research-focused faculty with industry-experienced colleagues on joint projects. As a result, both groups learned that their perspectives were stronger together than apart.

We also addressed our promotion and evaluation criteria. These criteria, which previously emphasized publication, were revised to recognize teaching innovation and industry impact alongside traditional research metrics. This structural change signaled that the school’s approach was permanent, embedded in its institutional DNA.

The PHOENIX Framework in Action

We now use PHOENIX to guide every aspect of our approach to business education. Here are just a few outcomes across three of the seven dimensions:

H (human capital transformation). Many of our professors now invite industry’s direct participation in their research. For example, Pranjali Gajbhiye, a neuroscientist with our AI Research Centre, collaborates with Vital Probe Inc., a U.S.-based healthcare technology company, on research related to medical device innovation and market penetration strategies.

Renu Girotra, an associate professor who specializes in human resources and international business, has an ongoing partnership with Caparo Maruti Ltd. in Gurgaon, India. This partnership, which focuses on automotive supply chain optimization and lean manufacturing principles, has produced real-time case studies that are integrated into operations management courses.

Shyam Krishan Joshi, Sudeshna Sani, and Syed Javeed Pasha, assistant professors who specialize in areas such as AI and machine learning, maintain active collaborations with Nosh Technologies, a U.K.-based food-tech company. They study startup challenges across different business functions, from operations to international market entry strategies.

I (industry alignment). Students routinely partner with companies to generate real-world impact. For instance, MBA students have worked with the healthcare company beHuman to analyze employment gaps and expand job opportunities for Hyderabad’s underserved communities. The students designed a scalable framework for connecting to local talent, which beHuman is now piloting.

Analytics and healthcare management students worked with the retail healthcare brand Lens&Meds to identify why the company’s month-over-month revenue had remained flat since its 2024 inception. Students developed data-driven recommendations to improve revenue streams, reduce cash burn rates, and provide actionable growth strategies.

Students also worked with BRAC, an international nongovernmental organization, to digitize its microfinance operations. Balancing regulatory compliance with environmental sustainability, the team designed offline and online hybrid microfinance models, designed to serve rural areas with limited connectivity and low technological literacy.

Students thrive when they see how they can apply what they learn, and faculty excel when their work has both intellectual and practical impact.

X (cross-disciplinary curricula). We systematically incorporate emerging technologies across business disciplines. For instance, finance courses integrate AI tools for predictive analytics and risk assessment models, while operations management courses address AI’s use for supply chain optimization and demand forecasting. Students learn how blockchain applies not only to financial transactions, but also to supply chain transparency, digital marketing verification, HR credential management, and operations audit trails.

For their capstone projects, students have worked with tools such as the Zoho analytics platform and explored advancements such as driver-assistance systems. In each project, students break down traditional silos between business and technology education, preparing for roles that require both skill sets.

Evidence of Effectiveness

Our experience has led us to two discoveries: Students thrive when they see how they can apply what they learn, and faculty excel when their work has both intellectual and practical impact. 

Since implementing the framework, we have seen several outcomes that validate the approach. More of our students receive offers from leading companies—often before graduation. Moreover, our school now attracts applicants who specifically seek an integrated approach to business education.

Industry partners have expanded their engagement with our faculty, bringing increasingly complex projects to student teams. And faculty report higher satisfaction levels despite—or perhaps because of—increased expectations for diverse excellence.

We believe that other institutions can achieve similar transformations by following this three-part process:

• Start by conducting an honest assessment. This step, which should cross all seven PHOENIX dimensions, isn’t about conducting complex measurements—it’s about asking the right questions and listening carefully to answers.
• Generate early, visible wins. Academic institutions are naturally skeptical of change initiatives. To build credibility for larger transformations, focus first on areas where progress can be demonstrated quickly and where resistance is lowest.
• Cultivate a transformation-friendly faculty culture. This step is perhaps the most delicate. Direct confrontation with traditional academic values typically backfires. Instead, build compatible cultures by creating new opportunities and incentives while respecting existing strengths.

The difference between successful transformation and failed change initiatives often comes down to institutionalization. Schools that achieve lasting change embed new approaches into formal policies, budget allocations, and governance structures before enthusiasm for change wanes.

The Choice Before Business School Leaders

The forces reshaping business education aren’t slowing down—they’re accelerating. AI continues automating analytical tasks that once formed the core of business curricula. Students increasingly question the value of traditional degrees, while employers grow more vocal about graduate preparedness gaps.

As we developed and implemented PHOENIX, we learned that transformation requires more than good intentions or incremental adjustments. It requires leaders willing to question fundamental assumptions about what business education should accomplish and how it should be delivered.

This framework offers a blueprint to build a business school for the digital age. Every principle has been tested in practice, and every component has been proven in real-world application.

Today’s business school leaders face a stark choice. They can lead their schools’ transformations, or they can manage institutional decline. After all, the phoenix doesn’t emerge from the ashes by accident—it rises by choice.