Inquiry and Discovery

The MIT Sloan School of Management faculty is driven by discovery, by the pursuit of ideas that address the world’s toughest challenges, and by a passion for problem solving. As they invent the next generation of organizations and devise solutions to ensure that the work of the world creates a better future for us all, they approach their work with an exceptional level of rigor and with a focus on relevance. This is work is not destined to remain between the covers of books. This is work that is applied–practically and with an emphasis on tangible impact–both in the classroom and in organizations around the world.

Drawing on our history of groundbreaking research, MIT and MIT Sloan will continue to champion the importance of such study to society. We invest in our faculty and their work because that work—in sustainability, the digital economy, healthcare, finance, and other fields—is shifting how all of us approach the world.

Inquiry and discovery are at the heart of MIT Sloan. These continuing pursuits define us and, in this rapidly changing world, will define the future.

Bennett W. Golub Center for Finance and Policy

When policymakers and government officials have questions about finance, they turn to MIT Sloan. Our finance faculty–long renowned for innovative research and practical applications–has developed theories and tools that guide global economies. While there has been a profound expansion and increase in complexity in the financial markets, the public sector has not consistently kept pace in its understanding or practice. Through the Golub Center for Finance & Policy (GCFP), MIT Sloan faculty members are conducting innovative, cross-disciplinary, nonpartisan research and leading educational initiatives that address the unique challenges facing governments in their roles as financial institutions and regulators of the financial system.

Led by Deborah Lucas, Andrew W. Lo, Robert Merton, Jonathan Parker, and Doug Criscitello, the GCFP is filling a knowledge gap between industry and regulators, bringing research and education to policymakers who regulate our nation’s complex financial systems and who allocate hundreds of billions of dollars of capital each year. The Golub Center’s three main research areas—Evaluation and Management of Government Financial Institutions; Regulation of Financial Markets and Institutions; and the Measurement and Management of Risk—will provide policymakers with new approaches to their work, help governments manage risk, and promote financial stability in the United States and abroad.

The GCFP faculty is focused on real-world application. They aim to help finance practitioners and policymakers understand the tools of modern financial analysis, with customized curricular materials, free online courseware, and executive education programs. The Golub Center is also helping to educate the next generation of sophisticated finance leaders, with action learning opportunities and courses for MIT Sloan students. Prepared with both the research and educational tools, the GCFP will help ensure stability through improved financial policy and practice for years to come.


Initiative on the Digital Economy

Defined by purposeful research and creative inquiry, the work of the Initiative on the Digital Economy (IDE) is shaping the second machine age. Led by MIT Sloan’s Erik Brynjolfsson and Andrew McAfee, the IDE’s team of visionary, internationally recognized researchers explores how people and businesses will work, interact, and prosper in an era of profound digital transformation. The IDE conducts groundbreaking research–often in partnership with business, government, and other institutions–in four areas—productivity, employment, and inequality; new digital business models; big data and information privacy; and social analytics and digital experimentation. Unmatched in its rigor and with immediate relevance to society today, the research across these four pillars yields recommendations to help companies, policymakers, students, and professionals adapt in a world of rapid digital transformation.

Building on this research, the IDE convenes academic and industry-specific activities and events to bring thought leaders together to exchange ideas, learn, and create solutions with a direct impact on business. The Initiative also invites leading practitioners to MIT to pursue research partnerships and to expose our students to varying approaches to both the challenges and the opportunities presented by the digital economy. The Inclusive Innovation Competition, launched in March 2016, calls for organizations to apply and present their ideas for improving economic opportunity for middle- and base-level income earners in the digital era.

The digital economy poses tremendous challenges and opportunities that will impact us all. With a focus on real-world, real-time solutions and the foundational belief that technological transformation is creating new opportunities for people and businesses to thrive, the IDE represents MIT at its best–pursuing inquiry and devising solutions that will improve the prospects for our global citizenry.

Initiative for Health Systems Innovation

Healthcare in the United States is facing significant systemic issues as costs increase, the population ages, and chronic illness rates grow. Seizing an opportunity to make the healthcare system more efficient, patient-oriented, and cost-effective—and aiming to fundamentally make people healthier—a group of MIT Sloan faculty members led by Joseph Doyle, Retsef Levi, and Janet Wilkinson have launched the Initiative for Health Systems Innovation (HSI).

With the engagement of more than 30 faculty members, the MIT Sloan School of Management has spearheaded a diverse body of research in health systems innovation. Through analysis of randomized control trials, HSI is examining the quality versus the cost of care and redefining and evaluating the productivity of primary care teams. HSI is analyzing organ donation allocations, developing a diabetes management tool, and reducing bottlenecks as patients transition through surgical units. The Initiative is investigating the cost of drug development, crowdsourcing patient care, and leading action-based research projects throughout the industry. Our faculty is creating a body of proof that demonstrates that change in healthcare systems is possible through organizational redesign, data analytics, and technological innovations.

The Initiative is a center of intellectual leadership and innovation that provides bridges to and from the health industry, and enables collaborative work between industry stakeholders and academics. HSI educates students and industry leaders through degree programs like the Healthcare Certificate, which offers a hands-on curriculum to all students at MIT, custom Executive Education programs that are structured around close partnerships with industry, and regular seminars and conferences. With new models, management practices, data analysis, and technologies to improve complex health systems, HSI and its affiliated faculty and students are working to transform health management, clinical practices, and systems design around the world.

Sustainability Initiative

From record-high temperatures and disease outbreaks to income inequality and global resource shortages, questions of sustainability, broadly defined, have never been more urgent. Led by MIT Sloan faculty members John Sterman and Jason Jay, the Sustainability Initiative is leading the way in addressing these critical challenges by promoting student engagement, supporting groundbreaking faculty research, and facilitating innovative industry partnerships in a range of sustainability-related domains. The Initiative’s ultimate mission: to encourage innovation in products and services, management practices, business models, and market infrastructures that make effective, sustainable use of natural resources and that advance human welfare.

Grounded in MIT Sloan’s legacy in system dynamics and innovation, the Sustainability Initiative engages faculty, students, alumni, and practitioners in open conversation about sustainability issues, challenging them to consider their own values related to social justice and care for future generations. It explores the creation of new companies through sustainability-oriented innovation; considers systemic approaches to constrained natural resources like fish, coffee, and cocoa; investigates the implications of policy on climate change; and analyzes the future impacts of fossil fuel usage.

The Initiative aims to become the premier source for sustainability best practices, tools, and research that will change the world.

Cybersecurity at MIT Sloan (IC)3

With large-scale credit-card cyber thefts an almost weekly occurrence, it is easy to view them as just an annoyance. Furthermore, we may be reassured by the increased quality of cyber defense tools and technologies. But the reality is very different. Yes, the defenders are getting better, but the attackers are improving at an even faster pace. Not only are their tools improving, but the scope of their targets is, too. Although not as widely publicized, they are seeking to control or damage our increasingly cyber infrastructure, whether it be attacks on German steel mills, Turkish pipelines, Ukrainian power grids, or New York dams.

Increasingly, the “technology” of choice for the attackers is social engineering–that is, getting you to unlock the door for them. If making the door stronger doesn’t help, we must better understand the organizational, managerial, and strategic issues around cybersecurity, particularly our cyber-physical infrastructure. That is the core goal of the MIT Interdisciplinary Consortium for Improving Critical Infrastructure Cybersecurity, aka (IC)3. Computer-controlled facilities produce and deliver our electric power, oil and natural gas, food and water, financial services, telecommunications, and healthcare, among myriad other functions. Yet, these facilities are dangerously unprotected from cyber-attacks. And the attack surfaces are only going to increase as we venture further into the Internet of Things (IoT), such as autonomous cars.

While many have pursued research on security within conventional information systems (shopping websites, for example), MIT and the (IC)3 are paving the way in research to solve the challenges faced by these critical infrastructure systems, and to ensure a safer future for organizations and individuals around the world.

MIT Laboratory for Financial Engineering

How do financial markets adapt to accommodate irrational human behavior? What can we do to identify and reduce systemic risks in the financial system before they turn into crises? Can new financial models help cure cancer, Alzheimer’s, and Ebola? These are just a few of the questions being asked at the MIT Laboratory for Financial Engineering (LFE), led by Andrew W. Lo, Charles E. and Susan T. Harris Professor at the MIT Sloan School of Management.

The LFE is a research center focused on the quantitative analysis of financial markets using mathematical, statistical, and computational models and methods. Created as a partnership between academia and industry, the goal of the LFE is to support and promote academic advances in financial engineering and computational finance. The LFE also engages with students, industry professionals, regulators, policymakers, and other stakeholders to facilitate new application of these financial technologies in practical settings.

LFE researchers draw on a diverse set of disciplines—finance, accounting, biology, cognitive neuroscience, computer science, and engineering—to tackle complex problems. By applying scientific principles, novel data analytics, and financial engineering expertise, faculty are developing new insights into longstanding research challenges in asset allocation, investor behavior, risk management, and regulatory policy, thereby deepening their understanding of financial market dynamics. These insights have a number of practical implications, including the creation of new options for financing biomedical research, drug development, and healthcare loans for expensive therapies; new methods of sharing aggregate risk statistics with regulators while maintaining privacy through cryptography; and new ways to help investors maintain a long-term perspective in the face of short-term market dislocations.

The LFE provides the platform by which MIT Sloan faculty members can tackle these complex financial issues and help translate new research ideas into practical proposals for dealing with some of the most challenging issues of our time.