Business school professors’ picks

Welcome to professors’ picks, offering a weekly curated selection of FT articles by and for business school faculty to connect classrooms to current events and to develop students’ critical thinking.

Read all submissions at www.ft.com/bschoolpicks. Save this link in myFT to receive emails alerting you to each new edition. Search the tags for relevant topics to illustrate teaching points. Encourage students to join the debate in the comments section beneath the article.

Comments or contributions? Get in touch at [email protected] 

Pollution from Big Tech’s data centre boom costs US public health $5.4bn

Summary: The articles quantifies the social cost of the North American data centre surge at about $5.4bn a year in health damages caused by NOx and SO₂ emitted by the fossil-fuelled grids that power server farms. Hyperscalers race to build capacity for cloud services, and AI model training and big-data analytics are marketed as the backbone of a “clean, dematerialised” digital economy. Yet the article shows how those same activities concentrate air-quality effects and premature deaths in nearby, often disadvantaged, communities.

It also hints at a paradox: AI and big data are simultaneously indispensable tools for decarbonisation, optimising renewables, grids and supply chains, while exacerbating near-term carbon-intensive emissions. The FT frames a strategic tension for tech companies: whether they can turn greener siting decisions, true 24/7 renewable procurement, heat re-use and on-site storage into a competitive advantage before regulators or customers price in the hidden externalities.

Classroom application: Students will debate how digital-economy players can reconcile AI’s and big data’s climate-mitigation promise with the environmental and social externalities of the physical infrastructure that enables them.

Questions:

• Locational logic: Why do data centres cluster in specific regions, and how does that amplify both economic benefits and health burdens?

• Green claims vs grid reality: How credible is a “100% renewables” pledge when a facility remains connected to a largely fossil grid?

• Cost allocation: Should hyperscalers, utilities, regulators or end users bear the US $5.4bn external cost — and by what mechanism?

• AI for climate: Identify two concrete ways in which AI/big-data applications reduce emissions elsewhere in the economy; do those savings offset the centre’s own footprint?

• Pricing externalities: Design a cloud-pricing model or policy tool (eg carbon-adjusted compute hour, health-impact levy) that internalises both CO₂ and local air pollution

• Innovation opportunities: What technologies or business models — 24/7 carbon-free energy, modular nuclear, heat-reuse district networks — offer the fastest path to aligning digital growth with environmental justice?

Concepción Galdón, Vice-Dean, IE Business School

Entrepreneurial Strategy, Business Model Innovation

Cosmetic surgery: elective procedures shift to needles and holidays

Summary: This article explores how the cosmetic surgery industry is undergoing a transformation from high-cost, invasive procedures to injectable, non-surgical treatments. UK patients are increasingly pursuing aesthetic procedures abroad, lured by new business models such as package deals combining treatment with travel. This shift has exposed new forms of market-side risk and business model disruption, challenging domestic providers and enabling the entrance of unexpected diversifiers and start-ups.

Classroom application: The elective cosmetic industry provides an unusual but instructive case for MBA and EMBA strategy classrooms. At UCL’s Global Business School for Health, many students come from a healthcare background and are generally focused on resource-side risk such as concerns around staff shortages, clinical efficacy of drugs or regulatory compliance. But this case highlights how many healthcare industries are increasingly defined by market-side challenges: shifting consumer preferences, cross-border competition or service commodification.

The article can be used to explore business model innovation: how and when firms pivot from high-margin, expertise-based offerings to more commoditised, volume-driven services. It also raises key issues in international competition, risk tolerance, and the role of trust in service innovation. I’ve used this article to drive EMBA classroom discussions on market vs resource-side threats and value reconfiguration and market entry in mature industries.

Questions:

• How should UK-based aesthetic clinics respond strategically to the rise in overseas competition? What elements of their existing business model are still internally and externally consistent, and which are now liabilities?

• What are the risks and trade-offs of shifting from surgical procedures to injectable or non-invasive treatments? Are these changes reflective of market-side innovation or a weakening of resource-based differentiation?

• In what ways does the packaging of healthcare as an “experience” (eg surgery + hotel + tourism) alter the competitive dynamics of the sector?

• What business models might prove superior in this context? And what types of start-ups and diversifying entrants might hold the sources for competitive advantage in this context?

• What is the effect of this trend? Are we actually delivering higher value to the patients or is this transformation at the expense of it?

Luka Gebel, Assistant Professor, University College London

Retail and Consumer Industry

Diamonds to detergent: weary consumers brace for more price rises

Tags: Negotiations, Consumers, Prices, Inflation, Retail

Summary: The tariffs introduced on April 2 have driven changes in global trade, raising costs on consumer goods companies, which are now looking to pass along some of increases to consumers. Retailers are pushing back, arguing that after two years of inflation, consumers are weary and higher prices will now drive down demand. Instead, they suggest that producers need to absorb more of the costs or manage their own supply chains to reduce costs.

Classroom application: This article provides an opportunity to look at the intersection between policies, economics and negotiations.

Questions:

• What arguments are producers making to claim there is no choice but to pass along tariff-related price increases to consumers?

• What arguments are retailers using to claim that consumers must be protected from price increases, and that producers should shoulder the burden or shift their supply chains?

• What is the power balance between consumers, retailers, producers and suppliers, and how do these dynamics play out across different product categories?

• How feasible is it for producers to move their raw materials and supplies between different countries in response to tariffs?

• What factors other than price, such as product quality and availability, concern you in this four-way negotiation?

Moshe Cohen, Senior Lecturer, Questrom School of Business, Boston University

Trade

US claims ‘substantial progress’ after two days of trade talks with China

Disciplines: Finance, International Entrepreneurship, International Strategy

Tags: Tariffs, US-China Trade, Economic Diplomacy, Trump Trade Strategy

Summary: According to this FT article, Treasury secretary Scott Bessent recently declared major progress in US-China trade talks. Both countries discussed important topics over two days, including market access, intellectual property rights and tariff reductions. The discussions are viewed as a positive move towards reducing trade tensions and promoting economic co-operation between the two biggest economies in the world, even though no agreements were announced.

Classroom application: This is a practical illustration of how high-level discussions between powerful economies can affect international supply chains, markets and business choices. The effect of reciprocal tariffs — 145 per cent for the United States and 125 per cent for China — the function of political leadership in economic policy, and the strategic reasons for creating a new consultative framework for continuing negotiations are some of the main topics of debate. Students can gain a better understanding of the intricacies of global trade relations, the interaction between politics and economics, and the strategic choices that companies must make in reaction to changing trade regulations by analysing this article.

Questions:

• What political and economic forces, despite their long-standing disagreements, led the United States and China to resume negotiations?

• What effects do high tariffs — 145% imposed by the United States and 125% imposed by China — have on multinational firms and global supply chains?

• What influence do domestic players like big-box stores and financial markets have on a nation’s trade policy choices?

• What potential effects might the creation of a new consultation mechanism have on upcoming trade ties between the United States and China?

• How do economic forces and political leadership interact in the context of global trade disputes?

• How can companies reduce the dangers brought on by abrupt shifts in major economies’ trade policies?

Case Discussion Positioning: Every day provides a multiple clues on how the current trade war may be successfully resolved online and offline. Both sides are moving from political sound bites to more pragmatic discussion. President Trump recently indicated that 80 per cent tariffs seem reasonable (eg pre trade talk levels). With the US supply chain in question, will China seek alternate sources of goods?

Gregory Stoller, Master Lecturer, Boston University Questrom School of Business

Got feedback on professors’ picks or willing to contribute? Get in touch at [email protected] or add your selected articles and questions in the comments below.