by Lenny Mendonca
The United States is experiencing a slow moving but
inexorable crisis in public leadership. I'm not talking
about Congressional dysfunction (although
I could be), but about the chronic underinvestment
in leadership in both the public and social sectors.
Strong, seasoned, and impactful leadership is needed to
solve our most urgent challenges: unequal access,
preparing our kids for a 21st century
world, improving public health, and mitigating climate
change. Despite the essential call to navigate the demands
of what lies before us, we overwhelming underinvest in
supporting these leaders and yet expect them to deliver.
They are set up to fail, and so are we all. This must
change, and soon. And with the appropriate approach and
scale, it can.
We've been here before. Coming out of World War II, the U.S.
(via the Marshall Plan among other massive investments)
played the leading role in rebuilding institutions destroyed
in the war. The greatest
generation was appropriately celebrated for
their service during an incomparably challenging era.
Despite major success, however, the business leaders who
drove the renewal didn't have the skills to lead the new
kind of global institutions that were emerging. Indeed,
there hadn't been a need before this, and thus the bulk of
any kind of business training available in the day were at
best mediocre trade schools.
I wrote with some former colleagues from
McKinsey in the McKinsey Quarterly last year:
"In 1959, the Carnegie Corporation and the Ford
Foundation issued reports that prompted a sea change in
the development of business leaders. The reports
reviewed the role of business schools, and they were
deeply critical. They argued that standards within
schools for hiring faculty, accepting students, and
developing curricula were too low. They recommended
schools adopt everything from an increased focus on
quantitative research to directing faculty to consult
less and teach more. Business schools had flourished
after World War II as the demand by American industry
for trained managers grew. The reports suggested that
schools were not meeting the needs of employers and
urged significant reform.
The nation's business schools responded with alacrity.
Accrediting standards rose, and schools transformed to
meet higher expectations. In 1949, only 50,000 U.S.
managers had an MBA degree. That year, business schools
graduated just over 3,000 MBA students into the
workforce. Today, about 500,000 students earn an MBA
each year worldwide, about 150,000 of them from U.S.
We need an equivalent call to arms today in public
leadership: the challenge in both the social and public
sectors is enormous.
The scale of the public sector in the U.S. is vast. The
federal, state, and local public sector accounts for an $88
billion payroll and 22 million employees according to
The social sector, while smaller, is growing rapidly and is
of key importance in bringing forward the innovation we need
to find solutions to our most challenging issues. More than
one million U.S. non-profits are working to address the
challenges of our time, accounting for nearly $837 billion
in products and services, or 5.6 percent of GDP, according
to the Urban Institute.
Sometimes referred to as the 4th sector,
for-profit organizations that integrate social change within
a business context add to these numbers and represent an
expanding segment of the social sector overall. Many
would argue that 21st century
challenges are - given globalization and technological
innovation - accelerating at a faster rate than at any other
time in history.
And yet, we continue to seriously underinvest in our leaders.
My former colleagues and I found that the private sector
invests over $12 billion a year in training their leaders.
That breaks down to $120 per employee every year. The social
sector spends about 25 percent of that: $29 per employee
annually. (In fact, the private sector spends more on coffee
per employee annually than the social sector spends on
The scale of investment is at least an order of magnitude too
low. Just as importantly, we need to reimagine how to spend
what we do invest, now and going forward. Classroom learning
is crucial, and we will need major investment in educational
institutions to scale with the need. Even with the tens of
thousands of MBA students annually in the U.S., shockingly
less than 1-percent enroll in a dual-degree track where the
demands are most pronounced.
The next generation of leaders will need to operate across
sectors to achieve the change the
world needs. Early programs like thePresidio
Institute Fellows program are making important
progress in amplifying the call for solutions and developing
the means to provide them. The most successful programs are
delivered in ways that reflect the way adults learn best –
in the field and within forums. Classroom learning is
directly linked to real work in the public sphere.
Supporting participants to learn, apply, and share their
learning, while building networks of collaborators all
within a context of keeping their leadership roles at work,
is the key combination we need to create change.
Future leaders are demanding programs that allow them the
opportunity to participate in public service before they
move on to other roles. Teach For
America has nearly 50,000 graduates apply every
year. Other post-graduate selective programs are
joining them in showing the way. Code
for America is placing technologists in state
and local government; the U.S.
Digital Service is doing the same for the
federal government; and FUSE Corps had
800 applicants for 16 fellowships in California this year, a
more selective ratio than Ivy League admission.
With clear interest from talented young leaders to serve, and
early results from current programs offering great promise,
the stage is set for a step function change in scale.
We need today's philanthropic leaders to make the kind of
bold moves the Carnegie Corporation and the Ford Foundation
did a half century ago. We have the same opportunity
to create a legacy of future leaders who will address the
challenges of today's world. A new greatest generation is
Mendonca is a Senior Fellow at the Presidio Institute,
the co-Founder and Chair of FUSE Corps, and a Director
Emeritus at McKinsey and Company.