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In recognition of the largest gift to any business school in the world, the GSB became Chicago Booth in 2008. David Booth, ’71, serves as a lifetime member of the school’s business advisory council and on the Board of Trustees of the University of Chicago. A true path breaker, Booth this year made Forbes’s list of the 40 “Money Masters: The Most Powerful People in the Financial World,” and Institutional Investor honored him with the Manager Lifetime Achievement Award. CBM sat down with Booth in Austin, Texas, at Dimensional’s home office, for his take on leadership, impact, and the value of an MBA.

How did Eugene Fama, MBA ’63, PhD ’64, help shape your career?

I went to the University of Chicago for the PhD program. I was going to be a professor. After taking Fama’s class and then working for him, I realized I probably didn’t have what it takes to be a leading academic. I decided that my strength was in applying the concepts rather than necessarily trying to think up the next great idea.

What motivates you to support educational institutions?

Business school was a major transformative experience for me in that it took this kid from a small town in Kansas and brought me into the financial world. Looking at what can really make a difference over the long haul, I think universities are one of the rare examples of institutions that last centuries. Support for great faculty endures for generations.

Describe your personal leadership style.

We try to establish broad principles and then get out of the way. One of our founding principles is to create opportunities for our people to contribute both to our success and to their own. How does that work? One example is that we really don’t do much in the way of budgets. Instead of budgeting and then reviewing how people spend relative to the budgets, we give them broad discretion and then just review their spending and see if it seems to make sense. Somebody coming out of the MBA program and looking at our leadership style would say it’s probably consistent with what he or she learned back in school.

Why is being creative and nimble important to you?

I draw a parallel between business school and sports. You go to practice and you study all the moves, and that prepares you to be in the game. Then you’re out there in the real world and suddenly you realize the other team practiced too, and they’re actually big. But you’re well prepared, and your practice has empowered you to be imaginative and creative and thoughtful and flexible—all of those things that distinguish exceptional thinkers, or great athletes. It’s that last little bit that makes all the difference. Having the confidence that comes from being well prepared enables you to try to use that creativity. That is what distinguishes people coming from Booth.

What would you say to the current generation of students?

When I graduated in 1971, we had wage and price controls, we were just getting ready to have floating exchange rates, and there were still fixed exchange rates globally. The world is quite different today. This is a terrific time to get an MBA. There’s a lot more opportunity, we know so much more, and technology is more advanced. Your smartphone is probably a million times more powerful than the biggest computer we had when I was in school. All of those factors create opportunity. But as [the late economist Joseph] Schumpeter described it, progress comes through creative destruction, so a lot of these tools and ideas that are new and different are going to be used to replace what’s come before. That puts a premium on being able to adapt.