Sounding a call for business leaders with understanding of the economic system and its social relationships, W. B. Donham '98, dean of the Business School, in his annual report to the president, made public yesterday, outlines a new and broader approach to business problems which the School is expected to pursue. Dean Donham cites over-specialization as an important cause of the current economic collapse, and voices the intention of the School to concentrate study to an increasing extent on the general problems of business.

In other sections of the report Dean Donham discusses the work in industrial physiology carried on by the Fatigue Laboratory of the School, the success of Morgan Hall last year in securing positions for members of the graduating class, and the curtailment of research due to the depression. Lest the School appear to be in competition with welfare and relief drives, no contributions were asked for last year from the 250 Associates, who usually give $1,000 each annually.

The important sections of the report follow:

Report Partially Printed

"Catastrophes of any nature force reappraisal of values in many lines of human activity. The current economic depression is no exception. If we dig beneath its superficial aspects it is impossible to escape the conclusion that our society suffers critically from over-specialization. Our great industrial and financial structure is conducted wholly by specialists. The field of specialization of each business leader is, practically speaking, limited to some one company and the scope of his most general thinking rarely ranges beyond production, sales, and finance. Yet it is a safe generalization that for all such companies no decision or series of decisions made by their chief executives affects their specialized interests so vitally as the complex social forces which make up this national and world-wide catastrophe. We need a new type of business executives, administrators with understanding of the complex organism which we refer to as civilization.

"Unfortunately, the fact that science and machinery open wholly new possibilities for good does not, in our unskilled hands, prevent their collateral consequences from being peculiarly dangerous; nor does it lessen the difficulty of maintaining social balance in the midst of rapid change. Unless we learn how to maintain our stability, the evil consequences of machinery may out-weigh the good.

"There is little cause for wonder that the economics of this new world pass our understanding. The changes are of great variety and pervasiveness. Nor can they be predicted with any assurance.

"As society is organized, much of the responsibility for dealing with these changes is in the hands of business and the overspecialization of business adds to the difficulty of accomplishing the essential results.

Quarter Century Ends

"It is particularly fitting that this School, as it approaches the end of a quarter century of study of business and of business education, should find problems of this general nature occupying much of its attention, for if rapid progress is to be made, much of the task must be done by our universities. Our first effort as a school was to learn about business as it exists both statically and dynamically. The larger task ahead is the training of men for the kind of administrative responsibility which I have just outlined--responsibility which recognizes business not alone as an aggregation of specialities, or even as a unity which can be thought of in isolation apart from the social organism; but as one social force possessing its significance mainly through its relationships to the social groups in the community. The most important problems of business arise out of these relationships.

"Along with the groundwork study of business mainly in isolation, now twenty-four years in process, we have during the last ten years been developing our Faculty for the larger problem of studying business in its relationships to other social activities. We are now prepared to organize a third year of study and instruction for selected graduates who are both equipped for and interested in this type of problem. This development was suggested in my report for the academic year 1930-31. Fortunately, while the funds required, although comparatively small in amount, are not immediately available, the lessons of the last two years have been deeply impressed on our present business leaders, and I am confident they will cooperate with the School so that in the near future we shall be able to carry out our plans.

Critical Study Proposed

"It is clearly undesirable, nor is it intended that we should restrict this more general point of view to the work of a third year and to a small group of graduate students. As rapidly as possible the present curriculum should be permeated with a critical study of wide relationships. Nevertheless, the curriculum of the School must continue both objective and realistic and be kept free from sheer sentimentalism. From a pedagogical standpoint this can only be accomplished by thorough specialized study early in the curriculum of business as it exists both statically and dynamically. The larger objectives can be effectively approached only on the background of such training. Any other approach would turn into efforts to blueprint the future and project Utopias in ways which will always remain logically impossible of attainment, because new and unforeseeable factors continuously intrude their forces and require reappraisals of the whole situation. The study of interrelationships will be most constructively pursued if it starts in efforts to coordinate the elements within separate specialized fields of business, broadens from that into a study of general questions of policy within business as a whole, and from that into the relationships of business as a whole, and from that into the relationships of business with the rest of the social organism."