The P&G MBA, Where the Sun Always Shines and Everyone Succeeds

(MoneyWatch)  Former Procter & Gamble (PG) chief marketer Jim Stengel now teaches at UCLA's business school, where his course ignores the fabled historic case studies (Walmart, "Marlboro Friday," etc.) that are milk and honey to MBAs in favor of cases presented by, well, his buddies. He's also writing a book that carries the modest title, "Grow: How the World's Best Businesses Use the Power of Ideals to Outshine the Competition." Apple (AAPL) and Google (GOOG) will feature prominently.

I'm sure Stengel is a great teacher, and there's got to be value in taking a course taught by a man who once controlled an $8 billion advertising budget. (It will certainly be a lot better, in a business sense, than taking any course taught by his predecessor, Denis "hookers and porn" Beausejour.)

The nagging feeling I have is that Stengel's course will pay almost no attention at all to failure. Knowing how to avoid failure is probably 80 percent of success in business. Ad Age reports:

Mr. Stengel is looking to reinvent marketing education along the way, scrapping most historical case studies for live ones presented by top creatives from BBDO and TBWA/Chiat/Day and executives from Dell, Procter & Gamble Co. and PepsiCo. He and Sanjay Sood, UCLA marketing professor and collaborator on the class, plan to pitch it as a model to the Harvard Business Review.

The chances of any current exec from TBWA or P&G giving a lengthy class on one of their business failures are, I suspect, slim. Students are probably going to hear breathless tales of amazing turnarounds, awesome new launches, and bold, profitable initiatives that make those execs look like geniuses. (With one exception: Stengel hints that Monique Bonner, director-global branding at Dell, will talk about how that company lost its way. Students might want to ask her some tough questions about the Enfatico disaster.)

The fact is that success in business is predicated on avoiding a few elementary mistakes: Don't get into a crowded category if there are low barriers to entry (i.e. the news media, the pizza restaurant business); don't get into sectors where potential competitors may already have economies of scale (i.e. oil or microchips); don't start a business that has low or non-existent switching costs for your own customers (apparel retail or shoes). Understanding why businesses that make these mistakes suffer from permanently tiny margins and high failure rates is crucial for managers, even in marketing.

The dirty secret of marketing -- which Stengel ought to know because he has an MBA -- is that advertising plays a mostly negligible role in brand success. (Do you really believe the iPhone's dominance was a result of TBWA's awesome TV ads?) More often, it's price, distribution and locking in your customers with technical barriers that make it difficult for them to defect to rival brands.

It's certainly not "ideals," as Stengel's book title suggests.

Image: From Jim Stengel's promotional web site.

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