TECHNOLOGY & SECURITY BizEdJANUARY/FEBRUARY 2005

VeriSign’s Stratton Sclavos On Track to Build a Better Internet Web Designs That Work Cyber Specialists Guard the Ivory Tower SPECIAL FOCUS: BizEd TECHNOLOGY Cont& SECURITY ents 36 JANUARY/FEBRUARY 2005 VOLUME IV, ISSUE 2

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6 From the Editors 18 21st-Century Engineer 36 An Ethical Education VeriSign’s Stratton Sclavos builds Archie Carroll studies the way 8 Headlines the infrastructure that will take students learn about ethics in the commerce into the next century. business school classroom—and how 46 Technology improved delivery methods can strengthen those lessons. Your Turn 24 Knights in Cyber Armor 52 As b-school networks face attacks from faceless marauders, IT 54 Bookshelf 42 The ROI on the MBA specialists defend the ivory tower. The MBA has come under attack for 56 Calendar offering low value. Two professors 30 Web Works crunch the numbers to refute the 58 Classifieds How to design the most effective charges. business school Web sites to suit 64 Spotlight today’s sophisticated surfers.

Cover photo: Robert Houser

BizEd JANUARY/FEBRUARY 2005 1 Fromthe Editors

Guarding the Castle Keep An author I know compares the process of writing fiction to the task of hacking his way through the jungle. Once he has chopped his way through dense overgrowth to the central clear- ing of water and light, he retraces his steps and makes the way smooth for the travel- ers who follow behind him. Writing magazine articles, I’ve found, is a similar but more complex process, partic- ularly if I’ve interviewed dozens of people and gathered information from a variety of sources. Then writing seems like clearing out an overgrown garden, yank- ing down vines, shoveling out excess, and pruning, pruning, pruning, till I’m left with one sculpted rose. I was certainly feeling that way as I put together the article “Knights in Cyber Armor,” which required me to organize massive amounts of informa- tion. This time, the imagery in my head was more technological than horti- cultural, as the twisting vines morphed into bulky cables and the bright blos- soms twining around the trellis were replaced by bright console lights blink- ing around the mainframe. Still a lot of clutter to clear out, still a lot of bits and bytes to organize! I assumed that many CIOs and IT specialists sometimes felt like garden- ers themselves as they continually fought through a thicket of information to find the perfect solution to their cybersecurity needs. But the ones I talked to seem to be operating on a different botanical principle. Many of them view themselves more as the caretakers tending the mile-high thorn bushes surrounding Sleeping Beauty’s castle. They spend all their energy cultivating a ring of defenses that guard the ivory tower from potential marauders—hackers, spammers, virus creators—while the innocents remain inside, peaceful, oblivious, and safe. It’s a role that makes perfect sense to Stratton Sclavos, CEO of VeriSign Inc., which offers security and authentication services for the online world. He thinks constantly about the best ways to keep data protected, from pro- viding products and services that safeguard computer systems to promoting education about how individuals can connect safely to their networks. He knows that the villains trying to breach the tower’s defenses will only become more sophisticated with time—which means the ring of virtual thorns must become practically impenetrable. Metaphors aside, cybersecurity is a complicated but critical component of b-school success. Without it, anyone can breach the castle keep and steal the treasure inside. And that treasure is not some simple rose, but the beating heart of the university’s data center—worth protecting with every hedge and knight on campus. ■z BILL BASCOM

6 BizEd JANUARY/FEBRUARY 2005 Headlines

Letter to the President bert F. Johnson Professor of Inter - walked into the voting booth better national Management. “There were informed, that would have been The re-election of George W. Bush is likely promises of tax cuts without serious more than we could have hoped to ensure a continuation of econom- discussions of the implications of tax for,” says Moss. “How they voted ic policies that are troubling to many cuts. We realized we have a lot of would be up to them.” business school professors across alumni who hold important posi- When drafting the letter, the America. A month before last year’s tions and who ought to be thinking authors attempted to lay out in neu- election, a group of professors at about economic issues, if for no tral terms the current state of the Harvard Business School in Boston, other reason than to understand economy and what factors have Massachusetts, composed an open how these issues affect their busi- brought it to this state, and then let letter to the president expressing nesses. And we wanted to reach readers draw their own conclusions. their concerns about his fiscal some of them and cause them to do But to the authors, the conclusions approach. The letter ultimately was some serious analysis.” are obvious. Harvard Business signed by 169 professors at business The letter certainly drew atten- School’s famous case study method schools around the U.S. before it tion. A couple of weeks before the teaches that there are many alterna- was mailed to the President election, the Web site had tive right answers, Wells notes. “But on October 5. had more than 50,000 hits, there are certain answers that are flat Among its concerns, the while the letter had been wrong, and we think the current eco- letter notes that “real GDP reproduced or referenced on nomic policy is flat wrong,” he says. growth during your term is countless other sites. The It remains to be seen if President the lowest of any presidential letter also was covered by Bush’s strategies will change after his term in recent memory. Total media outlets such as The re-election—in response to this letter non-farm employment has New York Times and CNBC. or other factors. It seems clear, how-

contracted and the unem- SHAWN THEW/AP WIDE WORLD Students, too, were most ever, that America’s business school ployment rate has increased. Bank - supportive, sending notes and e-mails professors will be closely watching ruptcies are up sharply, as is our to register their approval—but the the president’s economic policies dependence on foreign capital to authors emphasize that the letter had during his second term in office. finance an exploding current account no role in their classrooms. deficit. All three major stock indexes “This is a personal activity that Women and the Workplace are lower now than at the time of wouldn’t enter into the classroom your inauguration. The percentage of discussion,” says David A. Moss, The attitudes that men and women hold Americans in poverty has increased, John G. McLean Professor of about the workplace are explored in real median income has declined, and Business Administration. However, a new survey conducted by the Com - income inequality has grown. The he thinks it’s valuable for students to mittee of 200 (C200), an organiza- data make clear that your policy of see their professors standing up in tion of leading women business own- slashing taxes—primarily for those at support of a cause they believe in. ers and corporate decision makers. the upper reaches of the income dis- “One of the responsibilities of every C200 Report: MBA and Early Career tribution—has not worked.” The academic is to engage in public Women on Business is part of C200’s entire text of the letter can be found debate whenever there’s an issue rel- “Pipeline” research, a series of surveys at www.openlettertothepresident.org, evant to his or her work,” he says. that explore attitudes about business as can an addendum of names of “Clearly, we as academics are sup- on the part of women at various people who wanted to sign the letter ported by the public, and we owe stages of life. The survey of 933 after the signing period was closed. that in return.” MBA students and 807 MBA gradu- HBS professors decided to write Neither Wells nor Moss expected ates was conducted for C200 by the the letter because “we were discour- the letter to have an impact on the Center for Women’s Business aged about the level of discussion of outcome of the election—although Research. Among the findings: economic policy in the election cam- they hoped it would make voters ■ Business students and graduates hold paign,” says Louis T. Wells Jr., Her - think. “If a large number of people low opinions about major corporations, both

8 BizEd JANUARY/FEBRUARY 2005 OF THOSE WITH MBAS, 56.8 PERCENT OF WOMEN ARE LIKELY TO BE DISSATISFIED WITH THEIR JOB’S CAPACITY TO “MAKE THE WORLD A BETTER PLACE,” COMPARED TO 44.5 PERCENT OF MEN.

in terms of their ethics and the way they work; 57.6 percent feel well-paid; treat employees. and 56.3 percent feel satisfied. The survey shows that many Nonetheless, 41.4 percent of the MBAs from top schools are skeptical women say they are not excited about the honesty and ethics of about their work, while 67.2 percent Amer i can business, while women are of the men with MBAs say they are. even more skeptical than men. Perhaps this is because 63.9 percent Among students, 66.9 percent of of women MBAs do not believe their women and 56.8 percent of men dis- work contributes to society in a valu- agree with the claim that American able way, compared to 55.8 percent business is “honest and ethical”; of men MBAs who feel that way. Of among graduates, 69.6 percent of those with MBAs, 56.8 percent of women and 60.1 percent of men percent of women and 68.5 percent women are likely to be dissatisfied with MBAs take that position. of men say that women face particu- with their job’s capacity to “make Nearly three-quarters of MBA lar business challenges. The key diffi- the world a better place,” compared graduates (74.9 percent) do not agree culty, according to 70.8 percent of to 44.5 percent of men. that businesses “care about employ- women, is the lack of flexibility, lead- These survey figures are disturb- ees,” while 69.7 percent believe that ing to problems with achieving a ing, says Anna K. Lloyd, executive businesses pay top executives too work/life balance. In addition, 48 director and president of C200. “If much money. The majority, 55.5 per- percent of women with MBAs say women MBAs aren’t linking their cent, do not agree that businesses “do finding mentors is a specific problem, work to societal value, then fewer good things for their communities.” while 46.2 percent worry about gain- stellar women will be drawn to busi- In these cases, men’s and women’s ing access to business networks. In ness careers; and those who are may views are similar. Meanwhile, only 33 fact, most respondents with MBAs— not put their full energy and spirit percent of men and 26.1 percent of 92.5 percent of women and 81.8 into their work,” she says. She women say they have definitively percent of men—perceive that busi- believes further research is necessary favorable views of large companies. nesses are run primarily by men. to determine what is causing the gap “On the one hand, it’s troubling “One of C200’s core goals is to between men’s and women’s satisfac- that most MBAs are concerned develop ways to help improve the tion with work—whether it’s related about the ethical stature of the cor- pipeline of future women business to a discrepancy between the kinds of porate world,” says S. Diane leaders,” says C200 Board Director jobs men and women get, whether it Graham, C200 Chair and Chairman Agnieszka Winkler, Founder of The holds true for entrepreneurial of STRATCO Inc. “But, perhaps Winkler Group. Survey results lead her women as well as corporate women, early-career business people and to believe that “even now, we still need and whether it’s a general feeling MBA candidates will channel their to do more to both prepare women for among MBA women that springs awareness and concerns in positive the corporate world and prepare the from other root causes. ways—to improve the ethical stance corporate world for women.” Additional segments of the survey and priorities of businesses. Much of ■ Women are more confident about job investigate how men and women rate our research shows that women want security than men are, but women are less themselves at executing specific busi- to have a positive impact on society excited about work. ness tasks, such as handling money through their work. Helping to According to the survey, 57.9 per- and meeting deadlines, and whether improve corporate citizenship is a key cent of women MBAs say they have they expect to be earning enough way for current and future women job security, while 49 percent of men money to support a family or simply business leaders to do that.” feel that way. Most of these women to provide for themselves. For addi- ■ Women still face serious challenges in find their work agreeable: 75.2 per- tional information about the C200 the workplace, which is primarily controlled cent feel they have the ability to live survey, contact Elizabeth Koons at by men. according to their own values; 59.9 Sommerfield Communications at Of recent MBA graduates, 90.5 percent feel challenged by their [email protected].

BizEd JANUARY/FEBRUARY 2005 9 Headlines

Honoring Entrepreneurs the-art learning spaces in the and University of Utah. Collaborative Learning Center. “This is an educational opportuni- Washington State University in Pullman is There, traditional classrooms will be ty that promises to make a significant planning to open a new interactive replaced with suites that can be impact,” says Pam Perry, who is “Entrepreneurship and Innovation reconfigured and resized to foster associate dean of undergraduate Hall of Fame” to showcase cutting- brainstorming, collaboration, analy- programs at the Eller College. “The edge innovations and breakthrough ses, and high-tech presentations. experience will surely challenge the products from around the world. students’ moral reasoning while pro- “We believe this will be the first cen- Eller Competition viding a wonderful opportunity to ter in the world to highlight the Emphasizes Ethics network with peers. In the end, we accomplishments of dynamic and are raising awareness of the impor- creative people,” says Len Jessup, A student team from The University of tance of ethical responsibility in the dean of WSU’s College of Business Washington won the inaugural Western minds of our students; and that is and Economics. “Visitors to the Hall Region Ethics Case Competition held good business.” of Fame will actually experience the last fall at the University of Arizona’s This case competition is part of ideas, creativity, and vision of the Eller College of Manage ment in the E-tegrity initiative, which seeks pioneers of entrepreneurship and Tucson. The competition exposed stu- to make integrity an essential part of innovation. The digital Hall of Fame dents from nine Western universities to the Eller culture. More information will bring all of those to life.” an ethical dilemma they could face in about E-tegrity and the competition The Hall of Fame reflects WSU’s their careers. Student teams collabora- can be found on the Web at Entrepreneurship and Innovation tively analyzed data and responded to ugrad.eller.arizona.edu/etegrity. Initiative, designed to infuse entre- questions posed by a panel of judges preneurial attitudes into 245 fields of from the corporate world. The top Traits of a Leader study across the university. The cor- team won $1,000; the second-place nerstone of the Entrepreneurship and team, from the University of Arizona, Individual character is the single most Innovation Initiative is a dedicated received $500. important attribute in defining a state-of-the-art learning facility that In addition to the winning schools, leader, according to John J. Brennan, will house the new Grant Institute other participants were Arizona State chairman and CEO of The Vanguard for Entrepreneurship and University, Colorado State University, Group. “No other asset that a poten- Innovation. At the building’s Oregon State University, San Diego tial leader possesses could ever over- entrance, the Hall of Fame will lead State University, Seattle University, ride an ounce of concern about his visitors and students into state-of- University of Nevada-Las Vegas, character,” Brennan said, speaking at a leadership conference sponsored by the Center for Responsible Leader - Williams Steps Down at Arkansas ship and Governance at Villanova University in Pennsylvania. Doyle Z. Williams, dean of the University of Arkansas’s Sam M. Walton A second keynote speaker at the College of Business in Fayetteville, has announced his intention conference, retired general Anthony to return to the faculty next summer after 12 years as dean. R. Zinni of the United States Marine Williams is also chair of the board of directors for AACSB Corps, presented the audience with International, a position he will hold until July. what he called “leadership codes.” Under Williams’ leadership, the Walton College has expe- According to Zinni, the key code is: rienced a period of exceptional growth and development. In “Know what you want your legacy to 1998, the school received a $50 million gift from the Walton Family be and deliver.” Charitable Support Foundation, leading to the school’s name change in While many define leadership in 2001. During his tenure, the school also substantially revised its undergradu- terms of characteristics and traits— ate curriculum to integrate business into a general baccalaureate program. such as strength, confidence, trust- worthiness, dependability, and intelli-

10 BizEd JANUARY/FEBRUARY 2005 “A lot of the technology we take for granted today, like the Internet, semiconductors, and jet airplanes, were developed in the 1950s as part of defense, principally with Pentagon money. And nobody was thinking of the commercial applications until they became obvious. That’s what’s happening now.” —Paul Bracken, Yale School of Management gence—Zinni and Brennan have a tive effect on the bot- different perspective. In their presen- tom line.” tations, they noted that responsible The fear of bioter- leaders cannot simply rely on a set of rorism will help personality traits, but must hold spawn another whole themselves to a higher set of stan- new industry, Bracken dards. They felt that discussing the believes, as the gov- attributes of leadership was particu- ernment funds larly critical last fall as U.S. citizens research of self-clean- voted in a presidential election. ing products created by mixing chemicals Commercializing with steel and plastic. Counterterrorism start charging congestion taxes on While they’re being developed to cars that come into downtown, fight against germ warfare, self-clean- As business becomes increasingly complex, which the city of London already ing materials might ultimately be business schools must teach students does,” says Bracken. “The step from used in public spaces like stadiums, how to rapidly map connections among the counterterrorism camera to the subways, and fast-food restaurants. technology, social trends, and political tax camera is quite small. The spinoff “I think the commercial implica- and economic forces. At the Yale commercial implications of these tions will dwarf the defense ones,” School of Management in New Haven, technologies are gigantic.” Bracken says. “For example, lockers Connecticut, professor Paul Bracken Bracken also believes that using in schools and toys in day care cen- has designed a required core course technology to track people and objects ters could be built with anti-bacterial called “The Strategic Environment of is also right on the horizon. Even now, surfaces to cut down on colds and Management,” in which students are employees at large companies routine- earaches among children.” He taught scenario thinking as a way to ly wear their badges and submit to ID believes that the next “big thing” is make these connections and seize new verification at various checkpoints. clean products and buildings. business opportunities. “It’s a small step to insert a chip in He adds, “A lot of the technology Among other issues, the course that badge so the company can actual- we take for granted today, like the posits that a higher awareness of ter- ly monitor where an employee is in Internet, semiconductors, and jet air- rorism is causing major shifts in the the building,” Bracken says. “It’s planes, were developed in the 1950s American market. First, Bracken already happened in many hospitals, as part of defense, principally with argues, the general public has grown where they tag patients with chips. Pentagon money. And nobody was far more tolerant of surveillance and They’re even tagging their records to thinking of the commercial applica- other technology in public spaces keep them from getting lost.” tions until they became obvious. and corporate workplaces. Second, Therefore, Bracken thinks ID That’s what’s happening now.” he notes that federal and private chips developed to track visitors How does Bracken present these equity money being poured into new through sensitive government instal- new technologies to his students? technology is kick-starting industries lations may ultimately become the “I teach them to see the connections built around areas such as surveil- cornerstone for health-care reform by between technology and social lance and germ warfare. improving efficiency in hospitals. “So trends,” says Bracken. “Management Bracken points out that today’s much money is wasted in hospitals deals with complexity. How do you surveillance technology includes because people are queued up for X- rationally allocate resources to airport cameras installed in urban areas, like rays but the technicians can’t find the protection versus port protection? If Chicago, to monitor the streets for record of what they’re supposed to you’re Lockheed Martin, which tech- crimes and terrorist attacks. “I pre- X-ray,” says Bracken. “If you run a nologies do you invest in?” As the dict that in a few years, Chicago will hospital and you can get ten or 20 world continues to remain danger- use this system—developed and percent more throughput in your ous, he says answering such ques- deployed with federal money—to imaging business, that’s a huge, posi- tions becomes even more critical.

BizEd JANUARY/FEBRUARY 2005 11 Headlines

SHORT TAKES ■ A total of $53.3 grams. His endowed professorship million has been will run from January 1, 2005, GRANTS AND DONATIONS donated to Baruch through August, 31, 2007. ■ The Martin J. Whitman School of College in New York Management at Syracuse University in City by alumni William Newman, ■ New Mexico State University’s College New York has received a donation Larry N. Field, Lawrence Zicklin, Mar- of Business Administration and Eco- from retired business executive and vin Antonowsky, William F. Aldinger, nomics at New Mexico State Univer- alum Walter Kiebach to endow the and one anonymous donor. The new sity in Las Cruces will establish a new Walter and Olivia Kiebach Chair in In- donations lift Baruch’s capital cam- endowed chair thanks to a gift by the ternational Business. The inaugural paign past its previously stated goal of dean and his wife. An initial gift of chairholder will be professor Peter E. $150 million. The gifts will be dedi- $500,000 was given by Garrey E. Koveos, who is chair of the Depart- cated respectively to Baruch’s Vertical Carruthers, dean of the business col- ment of Finance, senior director for In- Campus facility; the restoration of its lege and vice provost for economic ternational Programs, director of the original classroom building; a chair in development, and his wife, Katherine, Diamond Institute for International entrepreneurship; the college’s per- to establish the Garrey E. and Investment and Taxation, and director forming arts center; an endowment for Katherine T. Carruthers Chair in of the Olivia and Walter Kiebach Cen- the college’s Center for Financial In- Economic Development. A $1 mil- ter for International Business Studies. tegrity, now known as the Robert lion contribution is expected from Zicklin Center for Corporate Integrity; the state, making the endowment ■ Babson College of Wellesley, Massa- and a chair in banking and finance. worth $1.5 million. Although the chusetts, and the Franklin W. Olin College chair will be in the business college, it of Engineering in Needham, Massachu- ■ The College of Business at Utah will be associated with NMSU’s Ar- setts, have received a State University in Logan recently re- rowhead Center Inc., which provides $600,000, three-year ceived funding for its first fully en- support and guidance to innovators grant from the National dowed chair. The George and Do- who want to turn their ideas into Science Foundation to lores Eccles Foundation funded the profit. The center, which will partner develop programs to chair to honor Eccles, the man who with New Mexico laboratories and teach engineering fac- was the key moving force behind other institutions of higher learning, ulty how to instill an First Security Corporation, the oldest will help create jobs, enhance student entrepreneurial mindset multistate bank holding company in education, recruit and retain faculty, into the nation’s engineering schools. the United States. and connect ideas with capital. The grant program’s first initiative, The Symposium for Engineering En- ■ The Stern School of Business at NEW PROGRAMS trepreneurship Educators (SE3), will New York University in New York City ■ Paris-based business school EDC teach teams of engineering educators has received a $1 million gift from has gathered a coalition of food and and entrepreneurs about the process the Toyota Motor Corporation to wine experts to launch the Institut and content of teaching entrepre- establish the Toyota Professorship of Supérieur de neurial venture creation and manage- Operations Management and Infor- Marketing du ment. Also involved in the SE3 sym- mation Systems. Sridhar Seshadri, asso- Goût, a train- posium will be Sloan Consortium for ciate professor of operations manage- ing program Online Learning, Roundtable on En- ment, has been named the first for those en- trepreneurship Education for Scien- Toyota professor. Seshadri will focus tering the tists and Engineers Stanford Technol- his research in the areas of supply food company ogy Venture Partners, Geo-Centers chain management and business sector. Starting in January, the nine- Inc., Jackson State University, Hamp- process improvement, while continu- month program will deliver a food ton University, and Salish Kootenai ing to teach in the NYU Stern under- and wine MBA to post-graduate stu- University. graduate and graduate business pro- dents or individuals with a solid pro-

12 BizEd JANUARY/FEBRUARY 2005 Leadership Lesson #28: REDEFINE CONNECTIVITY

fessional background in the field. Classes will cover management, com- munication, production, and sales for the industry.

■ Nissan Europe has selected IESE Busi- ness School in Barcelona, Spain, to carry BRYAN MITCHELL/GETTY IMAGES out a new leadership program de- signed for its top managers throughout Eu- rope. About 100 Nissan managers will participate in the program. The Nissan leadership program combines leader- ship concepts with real-world applica- tion to business problems, with a focus on innovation and risk-taking.

■ Webster University’s School of Business and Technology in St. Louis, Missouri, is rolling out an MBA Certificate in EXPANDEXPAND YOURYOUR NETWORKNETWORK Global Commerce, designed to equip TM students for op- Introducing MentorMatch an online proprietary erating across mentoring service from Drexel University’s LeBow College of Business. political, cul- tural, and geo- An innovative solution to mentoring in an increasingly busy world, graphical MentorMatch™: boundaries. The • users create online profiles 18-hour certifi- • system electronically matches mentors with students and alumni cate consists of creating strategic business connections nine online • mentoring occurs through private message boards modules of one credit-hour each, as well as three courses of three credit- “MentorMatch™ develops students for successful careers by providing hours. Students may choose modules real-time knowledge and expertise. I am proud to have the opportunity to from categories addressing various use my skills in leadership and management to enhance the experience of worldviews, cross-cultural perspectives, Drexel students.” — Dr. Hugh A. Chairnoff ‘61, managing partner, SevenOaks and international business mechanics. Capital Associates, Inc. More courses will be added in the For more information visit www.lebow.drexel.edu/mentormatch spring. The program was funded through a $400,000 grant from the U.S. Department of Education. COLLEGE OF BUSINESS ■ Audencia Nantes School of Management in France has launched a corporate Learn Here, Lead AnywhereTM LeBow www.lebow.drexel.edu MBA for top French-based personnel of the Stryker Corporation, one of

BizEd JANUARY/FEBRUARY 2005 13 Headlines

SHORT TAKES ■ The Sprott well as the high-tech undergraduate Professional Quinn School of Business. Lambkin the world’s leaders in the medical de- Programs Divi- is currently a member of the vice industry. The participants will sion at Carleton University in Ottawa, Governing Authority and Professor spend three days a month in Nantes Canada, is launching the Professional of Marketing at UCD. over 12 months, taking 200 hours of Certificate in Public Sector and Non- lectures, participating in business sim- Profit Marketing Program this ■ The Owen Graduate School of ulation games, and committing month. The program will provide in- Management at Vanderbilt Univer- themselves to 400 hours of individual depth skills to veteran marketing and sity, Nashville, Tennessee, has reor- work. Program-long projects will be communications professionals in the ganized its management team. Tami applied directly to Stryker initiatives. government and nonprofit sectors. Fassinger returns to the university as At the end of the course, participants During a series of modules over a five- associate dean for executive pro- will present their project findings to month period, participants will learn grams; Gary Scudder has been named the CEO of Stryker France. how to measure the effectiveness of associate dean for the MBA program; new initiatives in meeting organiza- Melinda Allen has been named assistant ■ The Kenan–Flagler Business tional objectives and how to demon- dean of admissions and career man- School, University of North Carolina at strate good value for public dollars in agement; and Yvonne Martin Kidd has Chapel Hill, is partnering with the Chi- the face of diminishing resources. been named executive director of nese University of Hong Kong (CUHK) marketing and communications. and Copenhagen ■ The University of Maryland’s Robert Business School H. Smith School of Business has an- ■ Richard J. Welke has been appointed as (CBS) to nounced that, beginning in Novem- Cor Wit professor 2005 at the Faculty launch an in- ber, it plans to expand its EMBA pro- of Technology, Policy and Manage- ternational gram in China to include Shanghai. ment at the Delft University of Tech- program in The school also has reached an agree- nology in The Netherlands. Welke is undergradu- ment to deliver a custom MBA pro- professor of computer information ate business. gram for Otis Elevator China, one of systems and director The pro- the fastest growing multinational of the Center for gram—Global Learning Opportuni- corporations in the country. Process Innova- ties in Business Education (GLOBE) tion at the J. —will allow students to study to- NEW APPOINTMENTS Mack Robin- gether at all three school campuses, as ■ Melvin T. Stith has been named dean son College of well as collaborate in virtual teams. of the Martin J. Whitman School of Business at Georgia State University in Students will make visits to corpora- Management at Syracuse University Atlanta. The Cor Wit chair is awarded tions headquartered in Brussels, in New York. Stith has served as dean annually to researchers in the field of Berlin, Shanghai, Tokyo, Washington, of the College of Business at Florida telecommunications and informatics D.C., and Research Triangle Park, State University since 1991. He be- who focus on research questions at the North Carolina. The first GLOBE gins his new appointment in January, interface of technology and society. students will be selected for the three- the same month that the Whitman year programs at CUHK and CBS in School moves into its new 160,000- ■ Jeffrey K. Pinto, professor of manage- fall 2005 and into UNC’s two-year square-foot building. ment, has been named to the Andrew undergraduate program in fall 2006. Morrow and Elizabeth Lee Black Roots of the GLOBE program can be ■ Mary Lambkin has been named the Chair in Management Technology in traced to the alliance of five business new dean of commerce at University the Black School of Business at the schools, Kenan-Flagler and CUHK College Dublin in Ireland. She will Pennsylvania State University at Erie. among them, in the OneMBA pro- have responsibility for the postgradu- In his new appointment, he will con- gram for executives. ate Smurfit School of Business, as centrate on the management of tech-

14 BizEd JANUARY/FEBRUARY 2005 THE FOX SCHOOL TEMPLEwww.fox.temple.edu Top 20 in the U.S. Executive MBA Programs Financial Times, 2004 Fox is on the move 4th Consecutive Ranking Top 20 in the U.S. Undergraduate and Graduate International Business Programs U.S. News & World Report. 2004 2nd Consecutive Year Top 20 in the U.S. America’s Top Entrepreneurial Colleges Forbes.com & Princeton Review,2004 Top 75 in the U.S. MBA Programs U.S. News and World Report,2004 Forbes, 2004 4th Consecutive Year Top 5 in the U.S. Most Wired Campus Forbes.com & Princeton Review,2004 THE FOX SCHOOL of Business and Management TEMPLE UNIVERSITY nological and organizational innova- ■ Irene M. Duhaime has been named as- ■ The Fisher College of Business at tion and the change needed to sociate dean for Georgia State Uni- The Ohio State University in Colum- achieve global competitiveness. The versity’s J. Mack Robinson College of bus has appointed Anne Lueneburger di- chair was one of four created in 2003 Business in Atlanta. Duhaime has rector of graduate programs, Eric with part of a $20 million endow- served the College as Zwerner Chair Chambers as associate director of ment gift from the Black family. of Entrepreneurship and Family Busi- MBA programs, and Terina Matthews as ness, director of the W.T. Beebe In- associate director of diversity recruit- ■ Henley Management College has stitute of Personnel and Employ- ing/financial aid/event management. announced the appointment of a new ment, and professor and chair of principal, Chris Bones, who takes his po- managerial sciences. ■ Several new appointments have sition January 1. After 22 years work- been made at Colorado State Univer- ing for Shell, Diageo, and Cadbury ■ The Hong Kong Baptist University sity’s College of Business in Fort Schweppes, Bones has significant ex- has appointed professor Simon S.M. Ho Collins. Professors Susan Athey, Paul perience in international business, ex- as its new dean of the School of Busi- Mallette, and John Hoxmeier have been ecutive education and development, ness. Prior to joining the school, Ho named associate deans. Athey will change, and HR strategy. served as Director oversee undergraduate programs; of the School of Mallette will be responsible for ■ Rosemaria Martinelli has been ap- Accountancy at research and administration; and pointed associate dean for student re- The Chinese Uni- Hoxmeier will handle graduate pro- cruitment and admissions at the Uni- versity of Hong grams. In addition, Stanley Slater, who versity of Chicago Graduate School Kong. Under his serves as professor of management and of Business effective May 1. Mar- leaderhsip, CUHK marketing, has been named interim tinelli is currently director of MBA became the first chair of the management department. admissions and financial aid at the accounting school outside North Wharton School of the University of America to receive AACSB accredita- STUDENT COMPETITIONS Pennsylvania. She began consulting tion. Ho is vice president of the In- ■ Two MBA students from the Uni- on admissions strategy at Chicago ternational Association for Account- versity of Toronto’s Rotman School of GSB in November. ing Education and Research. Management have won first prize in

BizEd JANUARY/FEBRUARY 2005 15 Headlines

SHORT TAKES ters. The centers were Stanford Univer- Smith, CEO of Starbucks Coffee sity’s Stanford Technology Ventures Company; Julius Walls Jr., CEO of an international competition that Program, the University of Portland’s Greyston Bakery; Gary Erickson, challenged MBA students to examine Center for Entrepreneurship, and The CEO of Clif Bar; Jeffrey Hollender, corporate entrepreneurship. The Falcone Center for Entrepreneurship CEO of Seventh Generation and au- competition, the ESADE MBA Busi- in the Whitman School of Manage- thor of What Matters Most; and ness Review, invites business students ment at Syracuse University. Thomas M. Chappell, CEO and worldwide to write a paper on a spe- Co-Founder of Tom’s of Maine and cific issue, which this year was “entre- ■ Bert W. M. Twaalfhoven was recently President of The Saltwater Institute. preneurship and innovation.” The awarded the Beta Gamma Sigma Topics included nonprofit manage- top ten entries were published by Medallion for Entrepreneurship, the ment, community development, ESADE last fall, and the winning society’s highest honor. Twaalfhoven, social funding and financing, corpo- team from Rotman presented its an alum of the College of Business at rate social responsibility, sustainable paper at an event hosted by ESADE Fordham University in New York, re- solutions, globalization and emerging in Barcelona, Spain. ceived the medallion during an event markets, and social entrepreneurship. at Fordham. The entrepreneur and HONORS AND AWARDS venture capitalist has launched more ■ The School of Business and Public ■ David Parker, chair of business eco- than 50 firms and acquired more Administration at California State Univer- nomics and strategy at Cranfield than ten others. sity in Bakersfield kicked off its Exec- School of Management utive Briefing Series with a visit from in England, has been ap- ■ Peter C. Browning has been named Steven Lyons, president of Ford pointed to write the Of- one of eight Outstanding Directors Motor Company Division and vice ficial History of Privatisa- for 2004 by The Institute of Out- president of Ford Motor Corpora- tion in the UK. The standing Directors. He is dean of the tion. The Executive Briefing series is appointment was an- McColl Graduate School of Business designed to bring high-level execu- nounced by the Prime at Queens University of Charlotte tives from major Minister in the House of and retired president of Sonoco corporations, Commons. The Prime Minister com- Products Co. He is being recog- government offi- missions Official Histories to record nized for his skill in handling corpo- cials, and non- major events and policy programs that rate change as he helped guide the profit organiza- have had a significant effect on UK boards of Lowe’s Companies and tions to campus domestic and foreign policy. Nucor Corp. through difficult succes- once a quarter to discuss cutting- sions. The institute will present the edge issues of management with ■ Two professors at Cornell Univer- award in March in New York at a gov- graduate students, faculty, and advi- sity’s Johnson Graduate School of ernance conference produced in con- sory board stakeholders. Management in Ithaca, New York, junction with the Columbia Business have been named Clifford H. Whit- School. ■ The Robert H. Smith School of comb Faculty Fellows. Warren B. Bailey Business at the University of Maryland in is an associate professor of finance, OTHER NEWS College Park has partnered with and Yaniv Grinstein is an assistant pro- ■ Columbia Business School and Net Impact human resources consulting firm fessor of finance. drew approximately 1,200 students, DBM to provide the school’s MBA professionals, and sponsors to the candidates with job search coaching ■ Three entrepreneurship centers have 12th Annual Net Impact Conference, and support. DBM’s online tools and been honored with the 2004 NAS- “Business Leaders Building a Better coaching programs will help part- DAQ Center of Entrepreneurial Ex- World,” held last fall at Columbia time, full-time, and executive MBAs cellence Award given by the National Business School in New York City. make career transitions and develop Consortium of Entrepreneurship Cen- Keynote speakers included Orin necessary skills. ■z

16 BizEd JANUARY/FEBRUARY 2005 21st-Century Engineer Forget about the information superhighway. Instead, picture the Internet as a global railroad

by Sharon Shinn photos by Robert Houser

tratton Sclavos is constructing the equivalent of the modern-day railroad. He’s laying down virtual tracks through Internet territory as he considers how to carry global commerce through the rest of the 21st century. Maybe even beyond. Sclavos thinks in terms of cen- Sturies and lasting legacies. The chairman and CEO of VeriSign Inc. runs a business not easily defined. The Mountain View, California, company offers “digital trust services”—security and authentication ser - vices for online buying and communication, as well as telecom services and domain name services. Recent acquisitions of Signio, which handles payments for online merchants, and Network Solutions, which assigns and tracks Web addresses, have made VeriSign a one-stop supplier of all Internet-based needs for corporations interested in online commerce. That’s all according to plan. Sclavos has said he wants VeriSign to be the Internet’s first utility—a pervasive, essen- tial, invisible part of the infrastructure that enables business to get done. He’s focused on making Internet transactions as secure and trouble-free as possible, and he’s constantly look- ing toward the future to help him determine what his choic- es should be now. Even in a field as volatile as technology, such focus has made Sclavos a recognized leader: He received the 2001 Morgan Stanley Leadership Award for Global Commerce and has been named to the Forbes list of Top 50 CEOs. Yet his definition of leadership is one that even an under- graduate business student can understand. “In many ways, it comes down to charting a course—having the ability to artic- ulate for your employees where you’re headed and how you’re going to get there,” he says. “Even more important is choosing people to work with who have that same level of passion, commitment, fear, and competitiveness to drive toward those same goals. A lot of people talk about vision- ary leaders. I believe that you have to do the heavy lifting every day, make sure you have your best people on your biggest opportunities, and make sure you don’t get compla- cent about where you are at any given point in time.” Sclavos knows where he is right now. Where he takes VeriSign in the coming decades may shape the way the whole world interacts with the Internet.

18 BizEd JANUARY/FEBRUARY 2005 covered with fast-moving trains. The man in the lead locomotive is VeriSign’s Stratton Sclavos.

I’ve been trying unsuccessfully to coin a simple expla- nation of VeriSign. Do you have your own shorthand description of the company’s services? We’ve been trying to come up with one for nine years! The simplest way to describe us is that we provide intelligent infra- structure services for the Internet and the telecom networks. In essence, we sit above the pipes of the Internet and the tra- ditional voice networks, and we provide services that make those networks more reliable, more secure, and more scalable. On the Internet side, our domain name services help peo- ple find Web sites as well as send e-mail. We handle about 14 billion interactions a day. On the telecom side, we help mobile professionals roam on cellular networks. We handle about 50 percent of all the roaming traffic in North America. Our services are designed to help people in business find each other, connect, securely communicate, and transact. We think those four things—find, connect, secure, transact—are the equivalent of the dial tone in the phone networks. This will be the infrastructure that services ride on for the digital wave.

Exactly what do you mean when you call VeriSign part of the Internet infrastructure? Look at the railroads of the mid-1800s. Look at electric power grids and air transportation industries of the 1900s. Today, look at telecom and the Internet. Each time a major econom- ic shift happens, a new intelligent infrastructure has to be put in place. We believe VeriSign is the company to build that intelligent infrastructure for this generation’s economic shift. The wonderful thing about infrastructure businesses is that, once you build them, you really are enabling hundreds or thousands of opportunities to succeed. It may be Internet commerce or it may be Internet telephony, but it’s all riding on the same infrastructure, so our investments can be lever- aged across them. We don’t have to make a live-or-die bet. We sleep better at night knowing that infrastructure is adapt- able to many other opportunities. At the same time, we have to have some courage, because the infrastructure has to be built before the market exists. It really is a “build it and see if they come” phenomenon. The market can’t get started until the infrastructure is there, but once it does get started, then the infrastructure better be very scalable and very reliable.

You started at VeriSign in 1995 as one of its first employees. What drew you to the company?

BizEd JANUARY/FEBRUARY 2005 19 I have an engineering degree, so I’d always been focused on about successful Internet companies from the 1990s, technology; but I really felt that VeriSign would give me a what would they discover? chance to hand-pick a team and build a company that would We were the last of the old-world venture funding companies leave a legacy. Whether that legacy was going to be security or instead of the first of the new Internet companies. For us it some other version of technology was not as important to me was about building a company in a bootstrap way—spending as getting an opportunity to build something from scratch as a byproduct of growth, not in anticipation of it, and laying and surround myself with people who had those same goals. a solid foundation for the company no matter what the mar- Our first business model, which was written before I got kets brought in terms of opportunity and change. I think this here, was to sell security services to Apple/Mac users and to notion of building something that will leave a legacy, and Lotus Notes users. The Internet came along just about the doing it in a methodical way, gives a company a strong foun- same time I did, and we had an opportunity to provide ser - dation from day one. vices for Netscape’s original products and, three months later, The other thing was that we were willing to adapt our for Microsoft. model based on what our customers told us. One of the say- Over the last nine years, we have learned a lot about how ings I’m fond of is, “Our vision is good but our hearing is to build an organization. You must understand your core better.” So, very early on, we listened to what Netscape and competencies, but you also must adapt to what your cus- Microsoft were telling us about the Internet. We listened to tomers are telling you are the real opportunities to pursue. what the government and large corporations were telling us Had we chosen the Apple/Mac and Lotus Notes market, we about their security needs. Relatively early on, we understood would not have survived as a company. that running intelligent infrastructures would enable elec- tronic commerce and communication; and if we did it right, You reached the CEO’s office without having a degree we’d be a beneficiary. Listening to customers and following from business school. What do you think you learned the winds of the market gave us a strong ability to adapt on the job that you never could have learned in school? quickly to what we saw. I think there are two sides to that coin. I had taken my GMAT So many technology company founders and business and intended to go to business school after working for a few school graduates are taught that they must stick to the strat- years. But I was in Silicon Valley at a time when the best edu- egy and stay focused. That’s a very, very important lesson. cation I could get about high-growth businesses was occurring The corollary is, you’ve got to listen to your customers if your right in front of me. In that particular era, I would say I prob- strategy is wrong. I think you need to keep your options open ably was better served not going to business school and just in terms of business direction and strategy, but you shouldn’t living in what was an incredibly dynamic environment. This stray from your core competencies. was a time when the first microprocessors and the first operat- ing systems for Microsoft and Apple came onto the market. It What should business students learn about the rea- was the most fascinating time in technology to live through. sons technology companies failed during the Internet On the other hand, when I watch business school gradu- bubble—and the reasons some of them are so success- ates who work for us, I see that they have a set of skills that ful now? I wish I had learned earlier. They understand modeling and I think that the key lesson is that you need to be No. 1 in your financial and strategic analysis. Would those tools have market. During the bubble, there was the notion that a rising helped me in the early years of Silicon Valley? Absolutely. tide raises all boats. We could have a thousand online book- One thing you don’t learn in a hypergrowth mode is disci- sellers, and they would all thrive. In reality, the No. 1 guy plined thought and analysis. makes at least half the profits of the whole industry. No. 2 may I think you need a blend of both kinds of learning—the make another 20 to 30 percent, and everybody else fights for discipline you can get from a business school curriculum as the scraps. So the notion of being a me-too player, or that well as on-the-job training that teaches you that business being No. 2 or No. 3 is OK, is really a fallacy. And I think that needs to be adaptive every day. is just as true in the online world as it was in the offline world. All the things we used to hear about—the new business At a time when a lot of other Internet companies were models and disruption of the online economy and disinter- failing so spectacularly, VeriSign was thriving. If stu- mediation, blah, blah, blah—I don’t think that all proved out. dents were looking at VeriSign as part of a case study I think the reality is, those who got there first with the best

20 BizEd JANUARY/FEBRUARY 2005 One of the sayings I’m fond of is, “Our vision is good but our hearing is better.”

value proposition and proved they could scale are now in a work perimeters for companies like Merrill Lynch and U.S. position to drive a disproportionate share of returns to their Bank. On their networks, we are now seeing twice the num- shareholders and their customers. ber of security events on a monthly basis as we did a year ago. What’s really happening? First of all, more and more of VeriSign is successful on a number of fronts, but some every business’s assets are being exposed to the network every of your primary offerings are secure payment options day. The more we move to a digital infrastructure, the more that allow people to buy safely over the Internet. Until companies are going to have to open up their corporate such options existed, people were reluctant to make assets. So there are richer and bigger targets. purchases online. What had to happen technologically Second, we’ve moved on from the early stage of security and psychologically to enable Internet commerce? threats that were really acts of mischief perpetrated by unor- Two things had to happen. First, the experience of buying ganized, disassociated groups of teenagers. Now, we’re seeing something over the Internet had to be better than the corre- much more organized forms of attack, like phishing and iden- sponding experience in the physical world. Whether they tify theft. With phishing, we have very sophisticated and were on Amazon.com or eBay, customers had to feel like it clever people targeting the e-mail addresses of customers of was a better use of their time and money to buy there. Online the largest banks in the world and trying to fool them into buying could only succeed if people could be convinced that giving social security numbers and credit card numbers on the risk was worth the reward. The risk of doing business Web sites that you and I couldn’t tell weren’t authentic. The online with an entity they could not see had to be outweighed sophistication of the attackers has grown dramatically in the by the reward of those benefits. last few years, commensurate with the amount of money In the early days, our security technology created an that’s now being transacted in the online world. umbrella under which many businesses could promise cus- I think we have to step back and say, “Well, isn’t it natural tomers that online buying was not only a better service, but it that as the economy moves to a digital infrastructure, so do was as safe as the physical world. If you do a survey of people the criminals?” They’re always going to be chasing the who still don’t buy online, the majority of them will tell you money. The economy is moving, and so are the threats. it’s because they’re afraid of putting in their credit card num- ber. That being said, online commerce through our payment For about three years, you’ve been a member of the gateway reached $10 billion for the first time last year. White House National Security Telecommunications Advisory Committee—NSTAC—which deals with Another crucial component of your business is provid- national security and emergency preparedness. How ing online security. What sorts of threats do you see to has your job there changed recently? the digital and telecommunications infrastructure, and It’s really only been in the last 12 to 18 months that we’ve how can people protect against these threats? turned the discussion from copper cables over bridges and Let me start small and go big. VeriSign networks and data cen- under tunnels to network attacks and the potential for seri- ters probably get attacked more than 500 times a day. Part of ous disruption of our financial, power, and utility systems. that is because of who we are, and part of that is because every- While the physical security protections were the most impor- thing we do is Internet-based. We’re just very available for tant things to focus on after 9/11, we are now moving into those types of threats. We also manage and monitor the net- a world where we have to pay equal if not more attention to

BizEd JANUARY/FEBRUARY 2005 21 I think, as security technology providers, we can create great products and services

the digital threat. What’s likely to emerge are blended here. My generation didn’t grow up with the Internet. We attacks that will have physical and digital implications. kind of had it thrust upon us midway through our matura- The real goal of NSTAC is to make sure that the private- tion. My children are growing up with both wireless services sector companies that operate much of the critical infrastruc- and the Internet as a part of life, and they’re not as sensitive ture are both prepared for national security events and capa- about security on these networks as they need to be. The ble of supporting the first-response initiatives for federal, next generation is the one that I hope will grow up with an state, and local governments. We have to make sure we’re as education system that tries to establish a culture of security. resilient against attack as we can be by sharing information— Their attitude will be, “It’s good to get on the network. It’s and then, when there is an attack, make sure we can provide better to get on the network safely.” a reliable backbone for communications so that emergency I think, as security technology providers, we can create responders can do their work. great products and services that will make people secure, but they only work if people use them. The next generation has Extending the issue of security to the university cam- to grow up using them and taking them for granted. pus, you might know that many business schools now require laptops and offer wireless connectivity. What I want to turn the conversation toward the future. would be the likeliest threats to such large, multiuser You have a 100-year vision for VeriSign. Can you educational wireless networks, and how can schools describe it? protect their students and themselves? We don’t call it the VeriSign Vision. We call it the VeriSign I think that in general we are a society, particularly in the Journey. A hundred years from now, how would we want the U.S., that will always choose ease of use and convenience over history books to describe what we contributed to technolo- better security. That’s true in what we do in an airport—it’s gy and society in general? We want to build the infrastruc- true when we give our credit card to a waiter—and it’s true tures that accelerate the next wave of economic activity—the when we take our laptops and hook up to wireless networks. way the railroads did, the way the electric power company There’s an obligation in the security industry not to force end and the air transportation industry did. And that’s a lofty users to choose security over convenience. That said, we have goal that our employee base has rallied around. to begin building services and technologies that are as easy to Backing it up from that hundred-year-out journey, we ask, use or as invisible to the user as they can be. We need to have “What does that mean we have to be 25 years from now? Five ubiquitous wireless networks with good security. years from now? And how do we stay on course by achieving So what could happen on a campus? The same thing that certain milestones this year?” If we want to leave a legacy, then happens at an enterprise. A user goes home, hooks up to his we want to be the most influential company of this century— broadband supplier, is Web surfing on personal time, and the way that GE or IBM or Microsoft were last century. unknowingly gets a virus or a worm downloaded onto his computer. He comes back in tomorrow and plugs into the We’ve already got e-mail, e-banking, e-commerce, corporate or campus network, then all of a sudden that virus and wireless data access, and we’re heading toward is everywhere. In the new genre of security threats, much of smart appliances. What else is coming? what we’re seeing is that the penetration occurs from a I have a slide in one of my presentations that shows the prover- friendly device that comes back into the network to contam- bial hype curve. It says when a technology is first announced inate it. That’s very different from two or three years ago, or introduced, the hype is like a rocket ship. But adoption rates when all the threats were coming in the front door. are slower than anticipated, so we go into the trough of disil- The new state-of-the-art in security is what’s called “vul- lusionment. That lasts for some period of time. And then very nerability assessment in management.” The idea is, instead of quietly, without a lot of fanfare, adoption kicks in. waiting for an attack, why don’t we proactively look at all the Much of what you’re going to see in the next five to ten machines in our network, highlight what the vulnerabilities years is the adoption of the technology and the infrastructures could be, and then begin isolating or patching them? It’s that were overhyped during the Internet bubble and given up somewhat like inoculation against some disease. Vulner - for dead two years ago. Those include using voice-over IP, ability management offers early warning systems, as opposed taking telephony from the traditional networks into IP- to threat detection and response. backed phones, reducing the costs of technology, and increas- I do think there is a longer term issue and opportunity ing the types of services you can get. Those might be wireless

22 BizEd JANUARY/FEBRUARY 2005 that will make people secure, but they only work if people use them.

data, games, videos, broadcast TV, ring tones, ringbacks— As for your own future, what would you like to you name it—five years after they were first touted, these are accomplish over the rest of your career, with VeriSign really starting to take off. Outside of that, we think the or elsewhere? notions of RFID tags and electronic product codes really do I’m absolutely confident this will be the last job I have. I have the ability to transform the supply chains of the world. love what we’re doing. I think the things we’re working on will have an incredible impact on the world over the next You’re talking about radio frequency ID tags, which five to ten to 20 years. The people we’ve surrounded our- store information on microchips that can be used to selves with all have that same kind of energy and passion identify both people and products. How do you expect and commitment to do great things. So I can’t think of a these to radically change commerce? place I’d rather be, nor can I think of anybody I’d trade With RFID, products can be tagged as they pass through places with in the technology industry. the supply chain, out of the manufacturing plant, through You know, CEOs often will say that going from zero to the warehouse, to the truck, and eventually onto the shelf. $100 million is the hardest thing. A few years later, if We know where they are. We know whether that product is they’re still in play, they’ll say that going from $100 million real or counterfeit. If that product is a pharmaceutical, we to a billion is the hardest thing. I actually think each new know whether it has expired or been recalled. We know if step demands a new level of discipline, a new level of com- it’s been stolen. mitment, and a new level of strategic thinking. So as we When you look at all the inventory that sits in distribu- take VeriSign from $1 billion to $2 billion, as we take it tion, all of the out-of-stock situations when customers can’t from $2 billion to $5 billion, I’m excited about the fact find a product on the shelves, all of the theft in the distri- that I don’t know how to do that job yet. And I’m very bution channel and at the point of sale, and add that up for confident that I’ll learn along the way. I’ll take a few mis- all manufacturers for all industries across all retail distribu- steps here and there, but I’ll be able to continue driving tion centers, you’re talking about between $600 billion to forward on this journey. a trillion dollars per year of economic loss. If we can shut down a lot of that leakage, there will be dramatic econom- What advice would you give to today’s business ic benefits to bread-and-butter industries. That will get school graduates? translated into lower prices for consumers, better earnings I think it is a really interesting time for them. What are the for retailers and packaged good companies, and a reinvest- opportunities? Many of them used to go into investment ment of some of those savings into new products. banking and management consulting. My personal opin- Trust me, RFID will go through its hype curve. Wal- ion is that that’s more like being a spectator at the Mart has told its 100 top suppliers they better be on board Olympics. All these incredible changes are coming, many by January 2005. Everybody’s going to be late. In the early of them driven by technology and by telecommunications. years, benefits won’t be seen all the way out to the shelf, They need to get on the field. I’m hopeful that the next just in case-and-pallet at the warehouse. So there’s going to generation of business school graduates is really focused be some disillusionment in the early days. But I believe this on getting into the workforce and helping build some- development will be one of the most significant changes thing great that leaves a legacy, rather than watching from our economy will see for several decades. the sidelines. ■z

BizEd JANUARY/FEBRUARY 2005 23

Knights in Cyber Armor Business schools rely on technical wizardry to keep their systems safe from virtual dragons.

he world of cyberspace is both magical and dangerous, and those who would cross its borders require skill and strong defenders to keep themselves safe. As electronic data transmission and wireless Internet access become coins of the university realm, business schools need to determine how to protect themselves, and their students, from cyber warriors. Schools have always taken cursory protective measures; but TT these days, school administrators are donning full armor as they step onto the virtual battlefield of the Internet. This attitude is relatively recent. “Until a couple of years ago, educational institutions viewed security as a philosophical issue as opposed to a technology issue,” says John Arsneault, director of network operations for Harvard Business School’s IT Group in Boston, Massachusetts. “In the past, when we talked about by Sharon Shinn implementing systems security or creating policies for restricting access, dis- illustration by Neil Brennan cussion would be about how this infringed on freedom and put up barriers to collaboration. That attitude has dramatically changed. Today, the schools that have the funds to do it are implementing systems in a very similar fashion to corporations.” Openness on a university campus is a thing of the past, agrees Arthur Downing, assis- tant vice president for information technology, professor and chief librarian at Baruch College in New York City. “We’re moving in a direction where faculty and students are more concerned about anonymity and confidentiality. They don’t want me looking over their shoulders when they’re on their network. But I have to be able to make sure that anybody who’s on our network using our resources at any given time is someone who should be there, and I have to know who they are.” Security experts are fairly certain that administrators at most schools are covering the basics—installing firewalls, recommending anti-virus software, communicating with users, and creating backups. Even so, many could stand to put up a few more shields and deploy a few more swords in an increasingly volatile cyber environment.

The Outer Defenses: Firewalls Firewalls prevent unauthorized personnel—even personnel from the rest of the universi- ty—from gaining access to the business school network. These software applications keep out users who are not authenticated and note unusual activity that signals some kind of attack. “We have people who monitor the reports of our servers and devices that watch for spikes in activity at certain points in our network,” says Downing. “It can become quite expensive to invest in all this technology.”

BizEd JANUARY/FEBRUARY 2005 25 Before setting up a firewall, HBS administrators imple- mented a product called PacketShaper, which restricts band- The Chink in the Armor width available for services such as file sharing. Not only does this instantly cut down on illegal activities such as swapping movies and music, says Arsneault, it allows the system admin- You can install every piece of hardware ever invented; you istrator to see which ports are being used for which applica- can require absolute synchronization of software. But if you tions. “When it came time to put in the firewall and close don’t get a buy-in from the users, the system will eventually services, we were able to close more than 99 percent of the break down. As is so often the case, in the realm of cyber- ports without stopping a single service that was being used on security, human beings are the weakest link. the campus,” says Arsneault. The organization Educause offers schools basic informa- About a year after installing the first firewall, he says, admin- tion about technical security solutions on its Web site at istrators went back in and shut down all incoming traffic out- www.educause.edu/security/guide, says security task force side the data center. “That means people can’t go in and host coordinator Rodney Petersen. But for any school security pro- their own Web sites, and can’t host peer-to-peer information gram to work, the human administrators must first develop a to their own PCs. It has literally made problems like denial of policy that explicitly spells out who is responsible for what service attacks and compromised PCs almost disappear.” and what should happen when something goes wrong. “The three steps are prevention, detection, and response,” he says. Inside the Castle: Virus Protection In terms of prevention, the first important component is Anti-virus software can do a superb job of preventing infect- risk assessment, which includes identifying and classifying ed information from corrupting the network—but it only all the data an institution collects. “For instance, a public works if every user has installed it and is keeping it up-to-date. Web server is public by definition, whereas student records And “every user” means every professor, staff member, and and grades are private,” he says. The second component is student who logs on to the network. “You can literally take to identify who the “data steward” is—such as the registrar out the network with one rogue PC,” says Arsneault. for student information and the comptroller for financial It’s easiest to control faculty and staff computers. At information. The third component of prevention is setting Harvard, faculty and staff must be authenticated as they log policies about access: who has it and what kind of controls onto a school directory. Service patches and anti-virus are in place. updates are automatically pushed through the staff/faculty The fourth component is training those with access about system by the central IT office. Recently Arsneault changed how to use and protect the data under their stewardship. “I the virus update refresh date from once a week to once an once worked at a university where a student employee in hour. “When you ask the server if there are any definition the registrar’s office gave the media information about a stu- updates available, 99 percent of the time the answer is no,” dent athlete that he had obtained from student records,” he says. “But if a virus definition is released, within 60 min- says Petersen. utes the system is updated.” In the area of detection, Petersen says, administrators Harvard has also installed LANDesk management software can’t just secure the mainframes and think they’re done; on the faculty and staff systems, which gives the central IT they have to secure the multiple devices that download and department the capability to do hardware and software inven- manipulate data from that mainframe. For instance, a trust- tories while allowing individual users to install software on ed employee can go to a protected mainframe and down- their own computers. “They still have ownership over their load employee information to his laptop. If the laptop is PCs, but we have the ability to know what’s on the network stolen or compromised, all that data is at risk. now and what software is running,” says Arsneault. “We tend to focus on electronic data and forget that it Harvard’s IT department also has installed two layers of can exist in a physical form,” says Petersen. “One day an virus control. The one at the e-mail gateway, which guards administrator showed me a printout of all the employee the system from outside attackers, purges 25,000 infected e- information, which he’d found in a trash can. What we’re mails a day, says Arsneault. The second one, a McAfee prod- talking about is the three stages of data flow: in storage, in uct, monitors internal e-mail—which doesn’t have to go transit, and in use. And we forget about data in transit and through the gateway—to make sure school personnel don’t in use.” pass on viruses picked up inadvertently.

26 BizEd JANUARY/FEBRUARY 2005 on probability theory,” he says. “If there is a low probability of a particu- lar kind of attack, it has never justified a high investment of resources to pro- tect it. However, that theory doesn’t really apply to critical infrastructure, because you really have to protect against any possibility of attack, even A fairly obvious part of detection involves monitoring the if it’s a very low probability.” When possibility theory is systems to determine if someone is trying to break in. A less applied to the risk management of critical infrastructure, he obvious part is having an administrator do preemptive investi- says, “it actually changes the kind of control framework and gating to find out how much information is publicly available safeguards that you put in place.” when it shouldn’t be. For instance, says Petersen, it’s a given Recently, Baskerville has been exploring how information that students’ Social Security numbers shouldn’t be readily warfare drawn from military models can be used in busi- accessible. He suggests using a Web search engine to type in ness applications. Specifically, the military follows a “deci- “Social Security numbers” and your school’s .edu address, and sion cycle” of observation, orientation, decision, and action; seeing if any faculty Web sites turn up with student grades during each stage, it seeks to achieve information superiori- posted by SSN. They shouldn’t—but they might. ty over an opponent. “You can apply those same concepts Finally, Petersen believes it’s critical to have a rapid to information security in a business organization so you response team in place so that if a security breach does occur, can protect the decision cycle against all threats, whether this group can instantly swing into action. Team members they’re viruses, intrusions, or attacks by miscreants,” he should include tech professionals, legal counsel, public rela- says. “This then forces you to manage information security tions representatives, and risk managers. “Have a procedure using that model rather than the technological model in in place, have the team in place, and test them both periodi- which you merely make sure you have all the right technolo- cally,” Petersen advises. gy in place. Information security officers following that cycle Anyone on campus who has any responsibility for data would be looking at a much higher level in terms of man- should have a baseline level of knowledge about security, agement concepts.” Petersen believes. Over and above that, he should understand IT specialists will also find themselves in a more coopera- his specific duties. “The institution has the role of setting policy, tive mode in the future, he thinks. Various organizations now and the user also has responsibility,” says Petersen. “The lead- monitor the networks 24 hours a day, such as the Computer ership should come from that data trustee and not from the IT Emergency Response Team (www.cert.org) run by the department.” Carnegie Mellon Software Engineering Institute. That group In complete agreement is Richard Baskerville, professor and works with users, software vendors, and the U.S. government chairman of the computer information systems department of to share information about viruses, worms, and other abuses. the Robinson College of Business at Georgia State University in Another organization, InfraGard (www.infragard.net), is a Atlanta. Having researched information systems security for coalition of private and governmental organizations, includ- about 25 years, he has seen that most organizations focus on ing the FBI, who have banded together to protect critical technical solutions and overlook management solutions. infrastructure in areas from agriculture to telecommunications. “People think that with the right encryption, the right access Such cooperation is essential because, even as techno logy control technology, and the right firewall, you can solve the evolves, it opens the way for new vulnerabilities—and the vil- problems,” he says. “We don’t have much good work on lains have the edge. “The attackers only have to discover a socially oriented solutions to these problems, like relating single flaw in the new technology to abuse it, whereas the employee behavior to security.” defender has to find all the flaws,” says Baskerville. “That’s What Baskerville really expects to shape the future of infor- actually impossible. Therefore, the defenders have to be able mation security is not technology, but a new attitude about to deploy responses to threats very, very quickly. The vicious risk management. “Risk management has always been based circle has moved to Internet speed.”

BizEd JANUARY/FEBRUARY 2005 27 It’s harder to control student systems, since students are when the person is on the network. The process only needs asked to comply voluntarily with regulations for patching sys- to happen once per PC.” tems and updating virus software. Arsneault recently imple- mented a user address registration system that kicks in when Soldiers in Reserve: Redundant Measures students get online in class; it allows him to track who is using It’s common practice for all institutions to back up data and the recommended software and who is not. “What we haven’t store it someplace safe. But where is safe? And how much decided is exactly how to deal with the folks who haven’t redundancy is enough? School administrators in New York installed the software,” he says. are particularly haunted by these questions. Says Baruch’s At Temple University’s Fox School of Business and Downing, “We’re probably more conscientious than most Management in Philadelphia, Pennsylvania, all students are schools because the odds are greater that we’ll be affected by required to install the school’s approved anti-virus software. terrorists. We’ve been at Orange Alert since 9/11.” That software, Symantec’s Norton AntiVirus Corporate When making backups, says Downing, the goal is to Edition, is made available to students via CDs and downloads have them close enough for easy access—but not so close from the university’s Web site. “We have been diligent,” says they’re also destroyed by whatever catastrophe takes down Ariel Silverstone, Chief Information Security Officer at the system. Because Baruch is part of CUNY, backup stu- Temple. “They can’t log on if they don’t have it.” dent and mainframe information can be stored on a sys- It’s not quite as strict at Washington University’s Olin temwide mainframe. School of Business in St. Louis, Missouri, which recommends Baruch doesn’t stop at creating redundant data storage; Norton’s anti-virus software but does not enforce its use. the school also has more than one communications link for MBA students are required to bring laptops; if they order the the campus network. “Before 9/11, many institutions only preconfigured Dell option, it comes with the Norton soft- had one path for communications,” says Downing. “If that ware. “But we tell them that any anti-virus program is better link was destroyed or interrupted, they didn’t have service. than none,” adds Scott Ladewig, manager of networking and Since then, many places have invested in not only having operations. “For students who claim poverty, we direct them another physical way in, but also in using another vendor.” to a free adware program.” Baruch is now part of a fiber-optic ring that includes a vari- Students who live on the Wash U campus get the anti-virus ety of educational institutions in Manhattan, says Downing. software free as part of their housing fees. “We’ve looked at Fiber-optic networks, he explains, allow signals to go in reverse, licensing it for other students who don’t live in university as well as forward, so that they can still get to their destination housing, but we haven’t gone down that road yet. It’s expen- even if there’s a break in the loop. Because the signal travels at sive,” says Ladewig. It’s also management-intensive. “If I light speed, it arrives at its target in the same time frame, even have 100 students using this software, how many of them live if it has to travel farther to get there. “We’re running that serv- in the dorm, and how many taking classes here are really stu- ice in addition to the same connection that we had at the time dents at another school in the university? It’s tricky unless the of 9/11,” he adds. “It would take quite an incident to create a university decides to license the software for every student.” disruption that would affect both of them.” It can also be tricky to deal with executive education partic- Along this ring is a commercial telecommunications and ipants, who frequently bring laptops that have been configured networking facility where the university leases space. “We have by IT specialists back at the corporate headquarters. “We servers in there that can be brought into action should some- haven’t really tackled this challenge,” says Harvard’s Arsneault. thing happen to our main computing system,” Downing says. “But we do want to be able to identify the systems they’re using and, if a machine is causing a problem, disable it. We’ll proba- All Flags Flying: Constant Communication bly do that with a MAC address registration application.” Since security is only as effective as the people practicing it, That MAC, or “media access control,” address registration these administrators work to keep their constituencies system directs users to the registration page of a virtual local informed. Most schools provide information about viruses or area network (VLAN). They must supply details such as their other vulnerabilities via e-mail, printed notices, and alerts names and domains before they’re allowed full access to the posted on school Web sites. Ladewig says that the Olin VLAN. “The whole process takes 60 seconds, and then the School covers the issue of cybersecurity during orientation for user has full access to HBS network services,” says Arsneault. incoming students, which reinforces communications sent “In addition, the IT group then knows who the person is and out electronically before students even arrive on campus.

28 BizEd JANUARY/FEBRUARY 2005 Arsneault expects corporations to adopt such measures before schools do and notes that it will be harder for schools to implement systems that will abruptly deny students access. “Especially if you don’t have tech support 24/7, you don’t want to be knocking people off the network,” he says. “If a student has an assignment due at 6 p.m. and he can’t get on the network and there’s no one to help him till the next morning, that’s not good.” Others go on an all-out campaign. For instance, Temple What the future really holds might be a higher degree of instituted an awareness crusade that makes it clear to students caution from human users, says Rodney J. Petersen, policy and faculty how important it is for them to join in the effort analyst and security task force coordinator for Educause, a to safeguard data. Writing in the Educause Quarterly, nonprofit association geared toward advancing higher educa- Silverstone describes the school’s efforts. “The awareness tion through information technology. For instance, Petersen campaign is disseminated through candy dispensers, posters expects to see more data encryption, which will keep informa- and fliers, and newsletters and Web sites—all carrying the tion safe even if someone hacks into a file or steals a laptop. security-awareness slogan: ‘The Bug Stops Here!’ We even Encryption techniques exist already, of course, but average broadcast information security infomercials on big-screen tel- computer users don’t bother to learn them. “The technology evisions situated in different lobbies and hot spots around needs to be transparent and easy to use,” Petersen says. campus,” he says. “We also introduced noncredit classes cov- He also predicts that there will be fewer multiple reposito- ering IT issues, including security. Although interested stu- ries of data, with files of personal information being kept at dents had to take the classes on their own time, and some the library, the registrar, the HR department, the recreation courses extended for a full week, the classes filled up quickly.” center, and so on. Instead, he expects there will be one cen- Even so, sometimes students continue to be cavalier about tral repository of data that is checked by other entities that taking simple safety precautions. That’s when IT departments need to authenticate a person’s identity. must take precautions for them. For instance, Baruch encour- Downing believes human, not technological, improve- ages students to change the default passwords they are issued ments will be necessary to make schools more secure. He says when they enroll. Last summer, a check revealed that 89 per- that administrators need to do a thorough self-assessment cent of the students had not done so. Since the default pass- before trouble actually hits to determine what their policies words are generally crafted of readily available student infor- should be and what they can afford to implement. mation—such as the last digits from their ID cards—they’re “How much are they willing to invest for peace of mind? easy to steal. That’s an institutional decision that goes beyond the IT “Not only can someone else get into a student’s account department,” says Downing. “When there is a situation like a and get access to all his personal information, but he can act power blackout, do they want us to evacuate the computing on that student’s behalf,” says Downing. Among other center, or should we stay to make sure all the data is secure? things, one student can de-register another from a full class to Those decisions need to be made in advance and implement- make room to register himself. Therefore, over the summer, ed campuswide.” Baruch changed all the student passwords. “The school news- Finally, everyone involved in cybersecurity needs to real- paper contacted us to say it was disruptive. But we viewed it ize that their jobs are never over. “This is an endless game, as an opportunity to educate students on the importance of unfortunately,” says Arsneault. “We’ve made monumental protecting their information,” Downing says. progress in the last couple of years, but there’s always some- thing more coming.” Girding Up for the Battle Ahead In another decade, the preventative measures put in place It seems that universities’ attitude toward cybersecurity can right now might appear to be curiously medieval, while the only go in one direction—toward more controls and tighter weapons used against them might seem equally quaint. But access. Many school administrators are closely watching the for today, the attacks launched against a university’s cyber development of new products that will require authentication fortress must be viewed as state-of-the-art, designed to bring before students are allowed to log onto the network or that down the ivory tower. The war is real, the enemy is armed, will quarantine computers that don’t have the right updates. and the academic defenders simply can’t afford to lose. ■z

BizEd JANUARY/FEBRUARY 2005 29 30 BizEd JANUARY/FEBRUARY 2005 Now that the Internet has evolved from mere novelty to sheer necessity, a Web site doesn’t just complement a business school’s marketing strategy. It is the marketing strategy.

t’s quick. It’s comprehensive. It has changed the User-Centric Universe way we live. It’s the Internet, which has evolved As business schools go through major redesigns, one lesson from a text-based playground for college-age whiz has become clear: An effective Web site focuses on what users kids to an interactive hub of information for every- want to hear more than on what a business school wants to say. one. No longer just a public resource, it’s now the That shift alone has moved many schools to rethink how their resource that people use most to work, chat, Web sites appear and function, says James Ho, a professor of research, and learn. information and decision sciences at University of Illinois in This has led business schools to examine more close- Chicago’s College of Business Administration. In 1996, Ho ly their Web-based marketing and communication wrote a well-circulated paper titled “Lessons of Business strategies. Such examination is a relatively new phe- School Web Sites,” which examined just how business schools nomenon among higher education institutions, says should and shouldn’t utilize their online real estate. Louis Malafarina, CEO of Ripple Effects “In 1996, it was clear that most business Interactive, a web design firm based in Pittsburgh, school Web sites were designed from the techni- Pennsylvania. When the company first began serv- by Tricia Bisoux cian’s or designer’s point of view—they didn’t ing the higher education market just four years have the user in mind,” says Ho. “I wrote that a ago, most schools wanted their Web sites to work site must be customer-focused, something that only as peripheral extensions of their offline marketing plans. has now become obvious. Business schools have learned to “The first time we worked with business schools, they target their stakeholders by category, including prospective viewed a Web site as a continuation of their offline, tradi- students, current students, alumni, faculty, and corporations.” tional marketing activities. Our business school clients just Even so, Ho believes that some business schools still have said, ‘Post our information,’” says Malafarina. “Now they’re work to do in creating sites that are truly intuitive and user- saying, ‘Sell our school.’ Schools realize that Web sites have friendly. For instance, some sites don’t make it clear on their become the cornerstone of their marketing activities. Today home pages whether a link called “Faculty and Staff” will take 100 percent of people choosing a higher education institu- visitors to an area of the Web site about faculty and staff or for tion will visit its Web site, so that site becomes a school’s faculty and staff. Other schools allow their sites to fall victim most powerful tool for outreach.” to an inherent truth of business education—its generation of The Internet’s evolution has brought with it a consider- an overabundance of information. able learning curve for all organizations, business schools “A business school has so much information to convey, it’s included. Business school Webmasters are exploring how hard to design a clean-cut Web site. It can’t be like Google users interact with their sites in more depth: How are people with only one window,” Ho admits. Some business school using the site? What pages do they visit? How long do they sites are viewing themselves as business portals, including fea- stay? What do they want when they get there? The answers tures such as stock quotes and weather reports; others want to those questions will be the secret to creating b-school to say everything about themselves on the home page. Both Web sites that meet—or exceed—the expectations of users instances may result in sites with extra features that users don’t from the moment they hit the home page. necessarily want and content they don’t really need. “In an

BizEd JANUARY/FEBRUARY 2005 31 The Newest Utility The Internet is now an inextricable part of life for those in the market for management education. In fact, Web sites have become commodities, like automobiles, says Wayne Marr, dean of the School of Management at the University of Alaska Fairbanks. “People view the Internet as a utility, like electric- ity,” he adds. In November 1995, Marr and partner Hal Kirkwood ranked the best and worst business school Web sites, judging them by criteria such as navigation, content, and usefulness. At the time, business schools with an online presence had increased to more Vanderbilt University’s Owen Graduate School of Management recently began a than 200 from about 30 in only six months. Dead links, incom- major branding initiative, which administrators wanted to communicate clearly plete faculty listings, scant informational resources, and woeful- through the school’s new Web site. A key feature on the home page is a prominent ly out-of-date content plagued many sites, says Marr. Only a image window. When users first visit the home page, designed by Ripple Effects, few, such as those run by MIT’s Sloan School of Management, they are greeted with the school’s brand slogan, “Discover this place. Shape your Harvard Business School, and Northwestern University’s world,” followed by a slide show of images of Owen students. Kellogg Graduate School of Management, earned high praise from Marr and Kirkwood. Those sites, says Marr, were precur- effort to become more comprehensive, many business schools sors to the modern b-school site, complete with faculty biogra- have made their sites unnecessarily overwhelming,” says Ho. phies, media pages, directories, research databases, course cata- Even worse, such tactics may drive away the central audi- logs, virtual campus tours, and online applications. ence a business school most wants to attract—first-time users, Efforts such as those by Marr, Kirkwood, and Ho would be who are often prospective students. This group most often much more difficult to accomplish today, they say, now that comes to the site to experience the school visually, via images, business school Web sites number in the thousands. In addi- quick-read links, and bullet-pointed information, not to read tion, the designs of today’s business school Web sites have lengthy blocks of text. For this audience, says Ho, a Web site’s begun to converge, becoming almost indistinguishable from top-level pages should be airy and simply organized, with links one another, says Marr. “Business schools are finding the sites leading to more detail for those who want more information. they like best and replicating them. I don’t mean to say they’re To best achieve that balance between simplicity and useful- all beginning to look the same—but, well, they are.” ness, many business schools are turning to external vendors to redesign their Web sites with their users in mind. For instance, IESE wanted its new site to be user-friendly, bilingual, and decentralized Vanderbilt University’s Owen Graduate School of Management so that each department can maintain its own content. Launched last in Nashville, Tennessee, worked with Ripple Effects last year to September, the redesigned site is targeted especially to first-time users, completely redesign its site at www.owen.vanderbilt.edu. The who should come away from their visit with a concise yet comprehensive idea site is now the linchpin of the school’s marketing strategy. The of IESE's mission, brand, and programs, says IESE's Larisa Tatge. school’s brand, exemplified by the phrase “Discover this place. Shape your world,” permeates the entire Web site, through images, content, and Macromedia Flash presentations. The goal for the redesigned site was threefold, says Yvonne Martin Kidd, the Owen School’s director of marketing and communication. The school wanted its site to help prospec- tive students make the important decision about their educa- tion, enhance the school’s new branding campaign, and con- nect with each visitor on a personal level. “We wanted the site to be easier to navigate, program-centric, and user-centric,” says Kidd. “The Web is the way people make decisions these days. We need to drive people to our Web site so we can help them make those decisions.”

32 BizEd JANUARY/FEBRUARY 2005 What’s Ahead for Web Design

Business school Webmasters will have much to do over the users for a business school: prospective students, alumni, and next few years. They must tweak, perfect, and overhaul their corporate stakeholders. But first, the school has to get them sites into ergonomically satisfying Web environments for all a there. A primary way to achieve that goal is to send e-mail business school’s constituents. All that tweaking will require messages that target a business school’s many audiences on more than great design. It will require even more robust an ongoing basis. Users who input their e-mail addresses at infrastructures emphasizing even more sophisticated the site then receive regular updates. Some schools are also approaches to certain facets of Web site design: using a format called RSS—or “rich site summary”—to dis- Avoiding “TMI Syndrome”—Business schools the world over tribute summaries that inform users when site content can succumb to the “too much information” pitfall, inundating changes. users with copy from the moment they enter the site. “When Tracking Usage—Once business schools have succeeded in my son surfs the Internet, he likes pictures, diagrams, simple driving traffic to their sites, they’ll want to track patterns of layouts. He doesn’t want to read a lot of text,” says Wayne usage to learn what areas of the site garner the most—and Marr, dean of the University of Alaska Fairbanks. “As my least—attention. “For the first full month our new site was up, eyes get older, I don’t want to read it either.” it received 85,000 unique visits,” says Yvonne Martin Kidd of Web designers recommend a “simpler-is-better” Vanderbilt University’s Owen School of Management. “But we approach, at least at first glance. They advocate that top- have no apples-to-apples comparisons to know whether that level pages incorporate quick-read sound bites and a limited number is high or low. We want to do a far better job of ana- number of links. Those links can then lead to more compre- lyzing traffic and seeing what works in terms of driving appli- hensive information for those who want it. cations. We want to start building those benchmarks, particu- Simplifying Searches—With so much information to navigate larly for key landing pages such as for the MBA program.” on their Web sites, many business schools have incorporated Benchmarking—No one currently ranks business school Web search technology from companies such as Google or sites, but Webmasters are beginning to watch their placement Inktomi. But rather than help users find what they want more on top search engines such as Google and Yahoo more quickly, these search functions can often lead to frustration, closely than ever. “We’re looking at how we rank in search says James Ho of the University of Illinois at Chicago. engine searches to see how effective our Web site is and Google, for example, has a special way of ranking results, what we can do to improve it,” says Scott Rolph of MIT’s in which the first time any user searches for an item, the results Sloan School of Management. are random. As more users search, those links chosen most Building Consensus—Collaboration has always been impor- frequently percolate to the top. That model works well when tant to Web site design, but it will become even more so as there are millions of users, says Ho, but not so well when the business schools develop sites that are the online equivalent number of users is much fewer, such as on a business school of their physical campuses. In this case, everyone needs a site. As a result, a search for “MIS” may leave the MIS vote, says Louis Malafarina of the Web design firm Ripple Department buried at No. 647 in the list of returned responses, Effects. “Although this might sound self-serving, it’s helpful to rather than at No. 1. Academic site designers will be eager to bring in an outside party to broker these discussions,” he find the right search technology to address this problem. says. “This helps everyone come to a consensus and realize Building Traffic—A Web site is one of the most effective the benefits of yielding individual agendas to the broad func- ways to build relationships with three important categories of tion a Web site must fulfill.”

Such homogenization in design and navigation isn’t nec- ilar audiences and have similar messages,” he emphasizes. essarily a bad trend. The adage “form follows function” has “But MIT’s Sloan School of Management isn’t going after manifested itself in modern Web design, with standard proto- exactly the same students as Northwestern’s Kellogg col requiring “About Us” and “Contact Us” links on the Graduate School of Management. A business school can dif- home page; navigational links along the left or top; a search ferentiate itself by using its Web site to claim a position in the box at the upper right; an emphasis on content over graphics; marketplace, so that it isn’t going after exactly the same stu- and a prominent logo that, when clicked, always takes users dents or offering exactly the same educational experience.” back to the home page. A site that strays too far from these standards most likely will frustrate, not impress, users. Ready, Set, Launch! Now that navigation and design choices are somewhat lim- Like the Owen School, other business schools have been ited by user expectations, business schools must look to other redesigning their Web sites—especially their home pages. For factors to differentiate their sites from competitors’ sites. example, Ripple Effects also recently worked with the Tepper They must go beyond conveying the standard “we’ll make School of Business at Carnegie Mellon University in you a leader” message, says Malafarina of Ripple Effects. Pittsburgh, Pennsylvania, on its site redesign. Its new site “The reality is that all business schools are speaking to sim- launched in January. Ripple Effects’ Malafarina and others

BizEd JANUARY/FEBRUARY 2005 33 ‘A Universe of Content’ – The Emergence of the Intranet

With Web real estate in the business school firmly estab- ter than we ever could. Where we could excel was in provid- lished, schools are now looking to add on, remodel, and cre- ing Wharton-only content.” ate areas of their sites targeted specifically to their internal That simplicity has led the site into a mainly text-oriented communities. Called Intranets, such online environments have presentation. Because Spike is an Intranet, rather than an become a substantial part of a business school’s online activi- Internet, environment, it can afford to include more links and ty, providing students, faculty, alumni, and corporate more text. Spike users are going there for comprehensive recruiters a range of services and resources. access to Wharton information, and they are willing to navi- Since The Wharton School at the University of gate a more complex interface. Easy Intranet navigation is still Pennsylvania in Philadelphia, Pennsylvania, first developed its crucial, however, so students can quickly find what they need. Intranet ten years ago, it has gone through several evolu- Whether they’re for an educational institution or a corpo- tions. Its latest incarnation, affectionately called Spike, now ration, Intranets are built by the enterprise. As a result, integrates all of the school’s separate services in one place, Intranets can become more about what the enterprise wants allowing students to read about Wharton news and upcom- to tell its constituents rather than what those constituents want ing events, reserve a group study room, or even pay or to hear, says Whitehouse. That “institution-first” mentality is deposit money into their campus printing accounts. as much a mistake with Intranets as it is with the Internet, he When Spike started, it was designed with a “portal men- adds. “The key to an effective Intranet is to give those con- tality,” says Kendall Whitehouse, Wharton’s director of stituents a blank canvas and let them design the product. It advanced technology development. That is, Spike aspired to should serve as their mental mind map, rather than reflect the be an all-in-one, customizable site that provided external educational institution’s structure.” news and resources as well as Wharton-specific information. Spike content is currently displayed on large plasma That, however, became too cumbersome—and it wasn’t what screens throughout Wharton’s central facility, Huntsmann Hall. students wanted. Eventually, Whitehead plans to branch out into other media, “Students didn’t want Spike to include everything they making Spike content accessible via PDAs and cell phones. needed in their lives. They wanted it to be everything they “We don’t want our students to have to check here, there, needed for their educational experiences,” says Whitehouse. and everywhere to be fully informed,” says Whitehead. “It’s “We realized that CNN could give them their daily news bet- the same information everywhere. It’s one universe of content.”

agree with Ho that the home page is the best way to make an mitsloan.mit.edu last year. When the redesign process began impression on first-time visitors—and all want that impression four years ago, staff conducted intensive testing of the site’s to be a good one. Almost invariably, b-school Webmasters say navigability, accessibility, and usability, says Scott Rolph, asso- they want their pages to be user-friendly, adaptable, and ciate director of communication and Web management. expressive of the school’s mission and brand. “Any attempt we made to jazz up a page that compromised IESE Business School of Barcelona, Spain, launched the the efficiency of navigation posed a problem,” says Rolph. most recent redesign of its Web site, www.iese.edu, in September. The school wanted the site to accomplish three main objectives: implement a user-friendly design that conveyed IESE’s corporate image, introduce a content management system that allowed new content to be added in English and Spanish, and create a decentralized organizational system that enabled each department to oversee specific sections. IESE’s new home page includes more space for news and events, and a “Highlights” list to promote programs. The site also incorporates a section called “The IESE Exper ience,” aimed at visitors. “We wanted to give visitors a com- prehensive view of IESE,” says Larisa Tatge, assistant director of IESE’s Web department. “We wanted the site to remain uncluttered, yet informative.” Harvard's new home page, launched last February, is designed for simple MIT’s Sloan School of Manage ment in Cambridge, navigation, including only those key links necessary to "point users in the Massachusetts, launched a redesign of its Web site at right direction," says Sam Hainer, associate director of Web strategy.

34 BizEd JANUARY/FEBRUARY 2005 layer,” says Hainer. The ongoing chal- lenge, he adds, is to use navigation tools and design to keep the site’s information accessible yet controlled, and the user experience uncluttered yet compelling.

Cultivating Connections Perhaps the most significant trend in busi- ness school Web site design is customer relationship management. Rather than merely using sites to facilitate one-time interactions with users, more business schools are using their sites as spring- boards to developing ongoing customer relationships. Once prospective students enter an e-mail address, they transition into a more refined marketing environ- ment, where they receive e-mails inform- ing them of school accomplishments or Members of the Wharton community can access Spike’s Intranet environment from their own devices, or view Flash presentations about student life. it on plasma screens within Huntsman Hall, the school’s central building. “We are seeing a strong trend toward CRM,” says Malafarina of Ripple Effects. “We also had to ward off attempts to add content. So many “Schools are staying with prospective students from the thought their programs deserved a top-level link, but we were moment they request an application until they matriculate. more worried about users. If you present users with a sea of They want to create such excitement that students won’t links, you won’t give them a good experience.” even wait to hear from other schools before deciding to The Sloan School’s solution was to create a home page enroll.” that includes only seven links on the left side, and a Kidd of the Owen School agrees that a primary function of “Spotlight” box that includes a news teaser. However, once its new site is to foster similar ongoing connections. “We’re users place a mouse arrow on one of those links, a new tree of using a lot of direct mail and other outreach efforts to drive links appears. This layering effect, accomplished through Flash prospective students to the site,” Kidd says. “Once they get technology, allows the Sloan School’s home page to remain there, we want to give them all the information they need to visually simple while maximizing access to information. understand that this is the place for them. Our marketing When Harvard Business School launched its new home campaign is in place so that more visits to the site result in page at www.hbs.edu last February, the school’s objective was online applications. Our goal isn’t so much to generate repeat to simplify its navigation and add links to two new sections of visits as it is to get prospective students to the site and inter- the site, titled “Who We Are” and “The Case Method.” Like ested in building an ongoing relationship with us.” the Sloan School’s site, the HBS site incorporates many links The current boom in Web site redesign is widespread and within a simple design: When users first come to the site, the ongoing among business schools, as schools move their sites bottom of the home page is free of text. However, once they from the periphery to the focal point of their branding and click a small link called “School at a Glance,” the lower right marketing strategies. At the same time, they must assimilate fills with additional links to the school’s various programs, hundreds, often thousands, of pages of content into easily centers, and departments. navigable and ostensibly simple online environments. That’s Sam Hainer, associate director of Web strategy at HBS, no small task. But as schools realize that their traditional says that the goal was to make the page user-friendly, quick, four-color printed brochures may survive only minutes and reflective of the school’s mission. “The home page needs before going from mailbox to trashcan, they know their Web to point users clearly in the right direction, while also making sites will be their best opportunity to reach users where they sure that key information about HBS is presented on the top now so often live—online. ■z

BizEd JANUARY/FEBRUARY 2005 35 An Ethical Education

36 BizEd JANUARY/FEBRUARY 2005 andidates with unsavory resumes might want to Learning about Ethics think twice before applying to The Wharton School To find what students were gleaning from their ethics cours- or the University of California at Berkeley. In the last es, we asked them to rank seven possible outcomes of their few years, each of these institutions has organized a classroom experience. Students indicated that they were C system of background checks to weed out untruthful learning the following, in order of importance: or otherwise unethical applicants to their business schools. Reportedly, Berkeley’s Haas School of Business rejected 1. Greater awareness of the ethical aspects of a business about five percent of the initial candidates for fall 2003 situation. because these background checks revealed inaccuracies on 2. Ethical concepts that will help me analyze decisions. resumes. Some applicants fudged work dates to conceal lay- 3. Ethical principles that can help me make better decisions. offs, for instance, or engaged in other forms of fibbing. 4. Ways to be a more ethical person. It’s hard to blame these elite schools for sifting out liars 5. Reasons my classmates see things so differently. and cheats. In today’s environment of corporate scandal, 6. Reasons my classmates see things so similarly. many business and political leaders have pointed to business 7. I’m not sure what I learned in this class. schools as the logical institutions to instill ethics in today’s executives. Since a key goal of an ethics edu- With the background checks, Haas cation is to help students perceive and Wharton are attempting to em - Discovering what and how ethical issues that might not be phasize the importance of ethics to readily apparent, it seemed logical applicants for the next year’s class to us that awareness would rank before they’re even enrolled. students learn in ethics highest. In fact, even awareness While many schools have been sometimes requires moral imagina- focusing on ethics education, opin- tion—the ability to perceive that a ion is divided on the best way to courses enables professors web of competing economic rela- teach the topic. Should ethics be cov- tionships is also a web of moral rela- ered in a stand-alone class or infused to design even more tionships. Potential ethical dilem- into a number of relevant functional mas are not always immediately courses? Should such courses be obvious; often they must be required of all students? And even effective courses. searched out by someone attuned to after ethics courses have been added complex situations. We believe that to the curriculum, how can we be an ethics education is successful if it sure we are teaching students what by Archie B. Carroll can teach students to develop a sen- we wish them to learn? sitivity to such situations—and a To answer that final question, willingness to explore them. one of my colleagues and I, both professors at the The fact that ethical concepts ranked second indicated to University of Georgia, have been conducting student sur- us that our students generally appreciated, if not understood, veys for three years. Our focus has been the stand-alone their importance. Concepts are descriptive. In an ethics class, business ethics course taught at the undergraduate level. they include ideas such as “integrity strategy,” “descriptive While MBA ethics courses get more media coverage, versus normative ethics,” “stakeholder management,” “busi- undergraduate ethics courses are no less vital and affect ness ethics,” and “moral development.” These concepts can larger numbers of business students. be extraordinarily useful to students in their careers since With the study, we wanted to answer three questions: they often act as frameworks or models that help executives What were students learning in business ethics courses? in decision making and analysis. How were they learning? Compared to other classes, how By contrast, principles are more abstract; and students valuable were these classes in preparing students for their sometimes find it difficult to apply them in practical situa- careers? With this information, we knew we would be better tions. Ethics textbooks generally explore three key princi- equipped to deliver an ethics education that would help pre- ples—rights, justice, and utilitarianism—and some ethics pare students for their careers in the corporate world. educators also discuss the Golden Rule. I found it encour-

BizEd JANUARY/FEBRUARY 2005 37 aging that, despite the difficult and abstract nature of ethi- ing that some people have the same viewpoint, a choice cal principles, students ranked them as third in importance ranked sixth. among the lessons they learned in ethics class. It was a huge relief to see that the lowest-ranked item on Equally encouraging was that “how to be a more ethical the list was “I’m not sure what I learned in this class.” It was person” was ranked fourth. Quite often, students seem to a gamble even to put this item on the questionnaire. resist this as a goal in an ethics class. It sounds neither aca- However, since the questionnaires were completed anony- demic nor fashionable to say that a course is teaching stu- mously, I believe that this ranking reflected honest answers. dents to be more ethical, as it implies some deficiency that must be overcome. However, this ranking suggests that stu- Classroom Approach dents might not be entirely resistant to the idea. Just as important as discovering what students learned was What students also learn in ethics class is that some of discovering how they learned. We asked students which teach- their classmates view topics much differently than they do, ing and learning methods were most effective as they studied which is an essential truth for managers attempting to ethics, and they ranked the choices this way: resolve ethical dilemmas in the workplace. Most often, stu- dents come to this realization through case study discus- 1. Lectures/presentations by the instructor. sions, when they discover that not everyone else has 2. Instructor-led discussions after student case presentations. responded to a particular set of circumstances in the same 3. My own reading of texts/articles prior to class. way that they have. Realizing that the world is full of peo- 4. Studying for and taking the exams. ple with differing viewpoints—a choice ranked fifth by stu- 5. Case presentations by student groups. dents in this survey—is much more important than realiz- 6. My own reading and studying of cases prior to class.

Encouraging Ethics at Eller have developed a range of new initiatives to integrate integrity into the college’s culture: The Eller College student oath. When freshmen business stu- More than half the students at the University of Arizona’s dents electronically schedule their first appointments with aca- Eller College of Manage ment in Tucson, surveyed two years demic advisors, they are required to review the integrity oath ago, admitted to cheating at some point during their aca- and accept its terms. The oath reads: “We, the students of the demic careers. The actual figure—54 percent—seemed both Eller College of Management, believe in fostering an academic astounding and unacceptable to ethically minded students. environment where competition is fair, integrity is promoted, Nonetheless, the number turned out to be close to the and academic dishonesty is punished. As members of the Eller national average, based on results of a 2003 study of pla- community, we voluntarily pledge our support for knowing and giarism at U.S. schools. Rutgers University management abiding by The University of Arizona’s Code of Academic professor Donald McCabe led the study, which surveyed Integrity, exemplifying ethical behavior in both an academic more than 18,000 students on 23 campuses. More than and social setting, and agree to challenge and make known half the undergraduates admitted one or more incidents of any acts of academic dishonesty.” serious cheating on written work, with 22 percent admitting Later, when students apply for upper-division status, they to one or more incidents of serious test cheating. Sixty-three are asked if they have cheated at the university. Their answers percent of students majoring in business confessed to cheat- are checked against student records. ing in the past year. A student honor board. Members of the board review policies “The statistics in these reports are astounding, but not and issues revolving around the student oath. These students are surprising, due to the competitive nature of business col- charged with promoting a culture of integrity and will work with leges,” says Eller student Tara Abbott. To reverse the trend, faculty and administrators to arbitrate integrity violations. Eller students began working with faculty and administration An E-tegrity Web site. Here undergraduates can find informa- to develop the Eller College Integrity Initiative, or E-tegrity tion on policies and codes, answers to frequently asked ques- for short. “Our student-driven board of honor and integrity tions, guides to student resource guides, and an application for was created to help eliminate academic dishonesty,” says serving on the Eller E-tegrity Student Board. Students also can Abbott. E-tegrity board members, of which Abbott is one, use the site to report academic dishonesty by engaging an

38 BizEd JANUARY/FEBRUARY 2005 Maybe the appropriate question is not whether ethics can be taught, but whether ethics can be learned. Considering my own personal experiences, I would say the answer is Y ES.

While modern educational theory holds that hands-on Once the data from these two sets of questions were ana- learning is best for students, these students obviously pre- lyzed, I began to revise the structure of my ethics course. ferred professor-directed learning when the topic was ethics. Other studies have indicated that students prefer case stud- This might have been because they know very little about ies centering around names they recognize, such as Wal- ethics before entering the course, so they are willing to defer Mart and Nike, despite the fact that disguised cases with to their instructors’ knowledge on this particular topic. unidentifiable names are often better learning platforms. The students also seemed skeptical of their fellow stu- While keeping case studies in the ethics course, I have elim- dents’ ability to present worthwhile case studies and unsure inated the group presentation of cases; I now lead discus- of their own ability to read and study on the topic outside sions myself. In addition, I put more importance on my own of class. While this might just reflect the fact that they don’t lectures. In fact, I make a short presentation, then I hold a put much effort into preparing for case discussions, it might dialogue with the students. I continue alternating lectures also underscore the notion that they feel unsure of them- and dialogues throughout the class period. selves in the arena of ethics. The guidance of an experienced instructor appeared to be welcome. The Value of Ethics In any case, students seem to value case studies and dis- We still wanted to learn how valuable students considered cussions, since they give these high marks in end-of-course their ethics courses in comparison to other management evaluations. It’s likely they find case studies valuable both courses, particularly as they thought about their future because they see the importance of the team-building expe- careers. The questionnaire asked them to rank six required rience and because case discussions give them a chance to classes in order of importance, and our students responded: explore others’ points of view. 1. Management 4. Finance 2. Business Ethics 5. Accounting electronic reporting tool that feeds directly into the college’s 3. Marketing 6. Economics student management system. Plagiarism-detecting software. The college has purchased Since the ethics course is required for management majors Turnitin.com, a Web-based software system that allows pro- and is an elective for other business majors, most sections are fessors to cross-check students’ papers automatically against composed of management students. Therefore, it didn’t sur- databases to identify plagiarism. The software also can teach prise us that management courses are considered to be of the students how to properly cite sources and avoid potential pla- greatest value. Likewise, these management majors often are giarism issues. less interested in quantitative finance and accounting cours- E-tegrity Week. The E-tegrity initiative was kicked off in es, so it’s also logical that they would rank those courses low November 2003 with a week of informational events that cul- while ranking softer skills of ethics and marketing high. minated in an ethics case competition. The school partnered Nonetheless, it was encouraging for us to see that under- with the Better Business Bureau for the competition, in which graduate management majors regarded ethics classes as the student teams presented solutions to a hypothetical business second most valuable course they will take in school. ethics problem. Deloitte & Touche sponsored the event, offer- I think it would be intriguing to ask the same question of ing team prizes. The Better Business Bureau presented the finance, accounting, and economics majors, who sometimes winning team with a $500 cash prize; executive-in-residence see soft skills as less relevant to their careers. Recent Bill Bowen wrote a $200 personal check to the runner-up. accounting and finance scandals, however, make it clear that Plans are under way to make this a statewide competition ethics are essential even to executives in these fields. with the potential to go national. Abbott believes that students, faculty, staff, and administra- The Debate Continues tion will all benefit from the comprehensive E-tegrity program. Despite surveys such as mine, I realize that many manage- “The Eller College is making its learning environment fair, and ment educators will still be grappling with a basic question: at the same time it is giving its students the skills that are Can business ethics really be taught? The question is debat- essential in a business world riddled with dishonesty,” she ed at meetings held by organizations such as AACSB Inter - says. “We believe that changing the culture of Eller is nothing national, the Society of Business Ethics, the Social Issues in short of helping to change the world.” Management Division of the Academy of Manage ment, and

BizEd JANUARY/FEBRUARY 2005 39 Look who’s reading BizEd! Methodology

To collect information about ethics education, I first drafted an open-ended questionnaire and administered it to an initial class of undergraduate business ethics students. Their answers were converted into the official question- naire, which was administered over three years to students in business ethics classes required of management majors at the University of Georgia, a large state university. The questionnaire was administered by two professors within the management department. One taught from a more traditional management perspective, the other from a philosophy-oriented perspective. The management pro- fessor gave multiple-choice exams, and the philosophy professor gave essay exams. Nonetheless, the two courses were structured similarly so comparative longitudinal data could be gathered from multiple classes. The data in this study were drawn from four sections taught by the management professor and three sections taught by the philosophy professor over a three-year peri- od. All questionnaires were administered during the final week of the semester. By the end of the survey period, 204 students had provided data. In a few instances, some of the rankings did not match exactly between the manage- ment teacher’s classes and the philosophy teacher’s class- es, but variations were minimal. Results for the combined class rankings are presented in this article. “BizEd is an invaluable tool that ‘boots’ up business education awareness to the next level, ensuring that I’m always in the International Association for Business and Society. Even 2,000 years ago, philosopher Socrates argued the issue with the know and equipped to meet the his fellow Athenians. He believed that ethics consisted of changing needs of industry, students, “knowing what we ought to do,” and he asserted that this and faculty. knowledge could and should be taught. ” Maybe the appropriate question is not whether ethics can be taught, but whether ethics can be learned. Dean Sueann Ambron Considering my own personal experiences, I would say the Business School University of Colorado at Denver answer is “yes.” People who doubt it should think about what they believed was right and acceptable when they were teenagers, and compare those beliefs to the ones they hold today. Case closed. The next question, then, would be one of pedagogy: Can business ethics be learned in the classroom? My survey indi- cates to me that they can. While this study was limited in The only way to ensure receipt of your scope, I believe it accurately portrays how students perceive personal copy is to subscribe. Visit their ethics courses, not only in terms of what they learn, www.aacsb.edu/publications for more but in terms of how ethics will affect their business careers. information or to download subscription I feel it is essential to understand what methods students forms and rates. respond to and how professors can reach students more effectively. Armed with that information, we can make sure our students leave their undergraduate studies with a firm grasp on how to behave ethically in the corporate world. ■z

Bi Ed Archie B. Carroll is professor of management at the University of Georgia’s z Terry College of Business in Athens. He also holds the Robert W. Scherer Chair of Management and Corporate Public Affairs and is director of the Nonprofit Management and Community Service Program.

40 BizEd JANUARY/FEBRUARY 2005 The R O I on the M B A

Some critics claim a master’s degree in business has little job-market value. But crunching the numbers reveals substantial long-term benefits to graduates with an MBA.

he darling degree of the 1990s was the MBA, which has been described as the ultimate business credential. Yet the debate regarding the value of the MBA has never been more con- tentious. Some critics argue that the luster of the degree has Tbeen tarnished by an oversupply of MBAs, excessive tuition at top-20 schools, an uncertain economy, and corporate misconduct. Others use anecdotal evidence to declare that an MBA has very little effect on a graduate’s subsequent salary or career. However, a macroeconomic analysis of the value of an MBA earned in the U.S. proves these critics wrong. This analysis by Antony Davies doesn’t compare MBAs to high-powered groups working as con- sultants, or to CEOs without professional educations. Instead, it and Thomas W. Cline simply attempts to show whether or not average, plain-vanilla illustration by Lou Beach MBAs can expect to fare better or worse than average college graduates over the entire course of their careers.

Deconstructing the Benefits Four economic benefits are linked to obtaining an MBA degree: a higher starting salary, greater compensation growth, more stable long-term employment, and a higher likelihood of participating in the workforce. Starting salaries. In 2002, the median full-time MBA student earned $50,000 before obtaining an MBA, according to The Graduate Management Admission Council’s “The 2003 Global MBA Graduate Study.” Immediately after completing the MBA program, that same student expected to earn $75,000, excluding signing bonus. Compensation growth. Since 1993, the expected annual wage growth for workers with professional degrees, including MBAs, has exceeded inflation by more than two percent. Those figures are provided by the Statistical Abstracts of the United States for the years between 1995 and 2003, which covers aver- age annual wages for those with BS, BA, and professional degrees.

42 BizEd JANUARY/FEBRUARY 2005 43 The “average” MBA fares SPECTACULARLY better than the “average” college graduate.

By comparison, the expected annual wage growth for workers with only undergraduate degrees has averaged just one percent more than inflation. Because of this difference in growth rates, the expected annual earnings gap between those with undergraduate degrees and those with MBAs should more than double—in real terms—over the course of their respective careers. Long-term unemployment. Since 1970, graduates with profes- sional degrees have experienced unemployment rates that are 25 percent less than those with undergraduate degrees, accord- ing to the Statistical Abstracts of the United States. Unemploy - ment rates were 1.9 percent and 2.4 percent, respectively. Likelihood of participating in the workforce. To be considered a workforce participant, an individual either must be employed or actively seeking a job. Between 1970 and Note that, 2001, 81 percent of those with professional degrees were during their workforce participants. By comparison, only 78 percent of prime earning years, those with undergraduate degrees fell into that category. around the age of 50, Again, figures are drawn from U.S. Statistical Abstracts. those with MBAs earn about $120,000 annually. That’s When all measures of salary and employment are consid- roughly twice the amount earned by their counterparts with ered, the value of an MBA can be quantified. Graduates with bachelor’s degrees. MBA degrees clearly fare better than those who have only earned BS or BA degrees. Evaluating the Investment Combining these four economic benefits makes it possi- Any investment can be evaluated by three measures: the ble to measure the earnings gap, or the difference between breakeven point, the internal rate of return, and the net pres- the lifelong earnings potential of the average college gradu- ent value. The breakeven point represents the number of years ate and a graduate with an MBA. Figure 1 shows the typical it takes for the income from an investment to pay for the annual compensations that graduates with MBAs and bach- investment. The internal rate of return is the effective inter- elor’s degrees can expect to earn during their careers. est yield that results from the investment. Net present value is Salaries are calculated from age 31 onward, as the majority the amount of cash-in-hand today that, if invested at current of MBA students are between 28 and 34 years of age. interest rates, would yield a stream of payments identical to Figures have been adjusted for the likelihood of unemploy- the income generated by the investment. If we use these three ment and labor participation. measures to judge an MBA from an AACSB-accredited school, we find that the average MBA degree is an extraordi- nary investment—even better than it was ten years ago. Expected Annual Compensation Over Course of Career In 1993, a 31-year-old who had earned a $140 K Breakeven point. (2003$) full-time MBA had invested an estimated $124,000 in the $120 K degree—$15,000 in tuition, plus $109,000 in lost compen-

$100 K sation—according to the Annual Survey of Colleges pro- duced by The College Board. He could expect to pay that $80 K off in 9.8 years. $60 K By 2001, however, the cost of the MBA had increased to $162,000, including $23,000 in tuition plus $139,000 in lost $40 K wages. Nevertheless, the graduate with an MBA now could MBA BS/BA $20 K expect to earn more money more quickly, enabling him to pay off his higher debt in less time—8.7 years. Figure 2 shows 0 31 33 35 37 39 41 43 45 47 49 51 53 55 57 59 that the breakeven point is getting shorter, not longer, despite Age rising tuition costs.

44 BizEd JANUARY/FEBRUARY 2005 Getting a plain-vanilla MBA today is like receiving a tax-free, cash award of more than a half million dollars.

Net Present Value: To determine net present value for an Breakeven on Investment in an MBA MBA, look at how much it will cost a candidate in tuition and 10 lost compensation, and subtract that figure from what the degree holder expects in increased salary over time. In 1993, Years from start of MBA studies a 28-year-old could determine that the probable cash-in-hand value of her MBA was $360,000. Put another way, suppose 9 two identical 28-year-old college graduates were contemplat- ing their futures in 1993. One of them was given $360,000 and entered the job market; the other started with nothing 8 and had to pay for her own MBA. By the end of their careers, the two would be equally well-off financially. Figure 4 shows that, by 2001, the cash-in-hand value of an MBA had 7 increased significantly, to $550,000. 1993 1994 1995 1996 1997 1998 1999 2000 2001

Net Present Value of an MBA Internal Rate of Return: In 1993, the average full-time MBA student could expect that, over the course of his career, his $800,000 $124,000 investment in an MBA would yield total increased (2003$) $700,000 compensation of $745,000 (in 1993 dollars). That’s the equivalent of a real rate of return of 15 percent—i.e., 15 per- $600,000 cent more than inflation. By 2001, however, the average stu- $500,000 dent investing $162,000 in an MBA could expect total increased earnings of $1.4 million (in 2001 dollars) over the $400,000 course of a career. That works out to a 17.6 percent real rate $300,000 of return, or 2.6 percent more than in 1993. And this was despite a 50 percent increase in tuition. $200,000 In short, over the past decade, an MBA’s average ROI has $100,000 been three times the return on Treasury Bills, ten percent bet- ter than triple-A bonds, and four percent greater than the $0 Dow Jones Industrial Average (DJIA). From 1993 through 1993 1994 1995 1996 1997 1998 1999 2000 2001 2001, as Figure 3 shows, only the NASDAQ provided a return on investment equal to that of the plain-vanilla MBA. Clearly, not all MBAs attain greater compensation and career benefits than their counterparts with bachelor’s degrees. Still, it’s even clearer that the “average” MBA fares Average Rates of Return (1993 through 2001) spectacularly better than the “average” college graduate. 20% Getting a plain-vanilla MBA today is like receiving a tax-free, 18% cash award of more than a half million dollars. 16% No wonder 100,000 students are currently seeking mas- 14% ter’s degrees in business. Perhaps, unlike the critics, these can- 12% didates have done the math to determine what very real 10% rewards they can reap by investing in their MBAs. ■z 8% 6% Antony Davies is a Research Fellow at the Mercatus Center, George 4% Mason University, Capitol Hill Campus, and assistant professor of eco- 2% nomics at Duquesne University in Pittsburgh, Pennsylvania. Thomas W. 0% Cline is an associate professor at Saint Vincent College in Latrobe, 6 Month 20-Year AAA BAA S&P DJIA NASDAQ MBA CDs T-Bills Bonds Bonds 500 Pennsylvania. This article is adapted from a lecture given to policymakers at the U.S. House of Representatives in March.

BizEd JANUARY/FEBRUARY 2005 45 Technology

“IF YOU’RE DEALING WITH IDEAS AT A FORMATIVE LEVEL,

Blogs About Biz “I also have a law degree, so I thoughts and research. “If you’re started by reading blogs by lawyers dealing with ideas at a formative Do you blog? If so, you’re part of a small but and economists, who have a lot to level, writing about them regularly growing number of business educa- say about the public policy issues of helps you put the pieces of the puz- tors recording their thoughts on busi- the day,” says Grace. “Business pro- zle together,” Garven says. ness issues in an online public forum. fessors, on the other hand, are talk- Starting a blog can be fairly pain- Short for “Web logs,” blogs are on- ing about whether it makes good less, even for the technologically line journals where writers post their sense for this firm to make that in- uninitiated. If you can type, you can thoughts to an audience of online vestment. It may seem less exciting blog, say these bloggers. Blogging readers. When blogs first appeared in than a topic like civil unions.” software can often be downloaded the mid-1990s, they often were noth- James Garven, professor of fi- online—inexpensively or even for free. ing more than glorified diaries. They nance and insurance at the Han- Many academics use software such as evolved into a medium perfect for kamer School of Business at Baylor Movable Type, a program available at journalism, analysis, and political University in Waco, Texas, keeps a www.movabletype.org. An older ver- commentary. Today, blogs have also blog at www.finweb.com. Also an sion of the software is available for become a popular teaching and com- avid blog reader, Garven subscribes free; the newest version, Movable munication tool for academics, espe- to the blogs of several law and eco- Type 3.1, is available to educators for cially those in law and medicine. nomics professors and has discovered $39.95 and includes tech support. Slowly, more business school that bloggers generally run in three Users can download the program to professors are blogging as a way to categories—those who want to teach create a blog on their universities’ communicate with students, post and inform, those who want to stim- Web servers; or they can use the com- assignments and bibliographies, share ulate discussion, and those who want pany’s TypePad service to place a blog favorite Web links, and present their to keep a record of their own on Movable Type’s central server. thoughts on topics of the day. Martin Grace, professor of risk management and insurance at Georgia State Uni- TOOLS OF THE TRADE versity’s Robinson College of Busi- Outblaze-EDU: E-mail Messaging for the Education Market ness in Atlanta, has kept a blog on risk management since last March at In only a decade, e-mail has gone from op- message board services. In addition, riskprof.typepad.com/tort/. tional novelty to ubiquitous utility. it provides security features such as Grace admits that at first he was a With this ubiquity, however, compa- anti-spam, anti-virus, anti-piracy, and bit wary of the practice for fear of nies must manage the billions of e- content-filtering. posting something he might later re- mails sent globally each day, while Higher education has different gret. “I was wary of the publicness stopping viruses; keeping their sys- needs than business, says Stef Bensi, and permanency of it. If you wrote tems safe from hackers; and thwart- managing director for Outblaze something idiotic, it would be there ing spammers, who purportedly send USA. “When employees leave a for the whole world to see,” says more than 50 percent of all e-mail. company, it just Grace. “I also worried about spelling Outblaze, a company headquar- and grammatical errors. I know tered in Hong Kong with a U.S. newspaper reporters do this all the office in Stamford, Connecticut, and time—but they have editors!” Such offices in China, Korea, India, and concerns may be one reason why the Philippines, recently launched an blogging has been slow to catch on e-mail platform designed for the edu- among business professors. In addi- cation market. Outblaze-EDU pro- tion, they may not believe their work vides students and faculty with any- to be as “exciting” as law or medi- time-anywhere access to e-mail, cine, so they may think they have online calendars, file sharing, and nothing to “blog” about, Grace says.

46 BizEd JANUARY/FEBRUARY 2005 WRITING ABOUT THEM REGULARLY HELPS YOU PUT THE PIECES OF THE PUZZLE TOGETHER.” —James Garven, Baylor University

sity’s Kelley School of Busi- benefit. Faculty bloggers receive ness in Bloomington, Ras- comments not only from students musen has kept a blog since and other faculty, but from others in- May 2003 at www.rasmusen terested in their ideas. In this way, .org. Unlike Grace, he had professors can use blogs to educate no compunctions about the public about business and as cat- blogging—even though an alysts for their own research. Because August 2003 blog entry he blog readers, as a group, tend to be posted on homosexuality less critical than formal peer review garnered him negative panels, blogging offers professors an attention from university open forum to test out ideas before administrators. pursuing them further. “Free discussion is im- Well-read blogs also provide valu- portant to scholarship, so I able exposure to academics, says never let my pride or fear of Grace. “Our external affairs staff is Obviously, faculty bloggers should being wrong stop me,” says Ras- always trying to be careful about what they post. Be- musen. “But I write my blog for my- get our profes- D A T A B I T cause blogs are public, faculty who self as much as for anyone else. I sors’ names into According to Forrester Re- post controversial opinions or criti- view it as a record of ideas, facts, and newspaper arti- search, based in Cambridge, cism of their universities do so at links I find useful—a record I’m will- cles,” he says. Massachusetts, there will their own risk, as Eric Rasmusen dis- ing to let others see.” “This is a way to be an upsurge in the off- covered. A professor of economics Still, the fact that blogs are so get the name of shoring of U.S. jobs in the and public policy at Indiana Univer- public is also their most significant the university in next year. It estimates that front of people.” 830,000 jobs will leave the For any busi- U.S. in 2005, a 40 percent shuts down their accounts,” Bensi Web portal and servers from a third ness professor increase over its previous says. “But universities want to pro- party can be a lower-cost option, he new to blogging, estimate. In the long term, vide e-mail services to alumni on a says. For instance, an internal e-mail Rasmusen and the company estimates that long-term basis for networking and system may cost a university $1 to $2 Grace have some 3.4 million jobs will go off- fund-raising purposes.” So, a busi- per user per month, while an out- advice. First, says shore by 2015. ness school with 5,000 students and sourced system can reduce that cost Rasmusen, decide 30,000 alumni may provide 35,000 to less than $1. what kind of blogger to be. “Busi- e-mail accounts this year. In two Founded in 1998, Outblaze cur- ness bloggers should decide whether years, that number grows to 40,000 rently handles more than 200 million they are (a) taking notes for them- accounts, and, in another ten, to e-mails for 35 million users daily for selves, (b) writing a regular journal 65,000 or more. companies such as Verizon, Dell, and on topics of the day, or (c) writing “Over time, a university has a LinuxMail.org. To enter the educa- an irregular posting of ideas and buildup of accounts,” says Bensi. tion market, says Bensi, “Outblaze facts on topics of lasting interest.” “Any expansion involves increased has the scale to easily add and sub- Finally, if they want their blog hardware, maintenance, and data tract hundreds of thousands of email to be a destination for readers, aca- storage costs. Universities, especially accounts for schools each semester, demics should choose a specialty to those using systems developed inter- implement the newest technologies better create a blog that inspires nally, don’t always have the techno- at the lowest cost, and monitor the other people to respond, says Grace. logical resources to continue to keep network for dangerous or inappro- “It may take a while to find a niche, their systems up-to-date.” priate e-mail.” but it’s important to find a specialty Outsourcing e-mail services that For more information on Out- and stake out your territory,” Grace are compatible with a university’s blaze, visit www.outblaze.com. advises. “Just like in business, mar- ket yourself.”

BizEd JANUARY/FEBRUARY 2005 47 Technology

Conquering the Therefore, a business school should transition. Only by including all users Wireless Challenge ensure that its help desk is appropri- in the process can a school ensure sat- ately staffed and prepared at the be- isfied users and smooth deployment. How does a business school jump fully into ginning of each semester for a flood Accommodate peak work times. A wire- wireless networking? Administrators of new users needing support. less network should have enough ca- at the Johnson Graduate School of Cut the cords. Few students come pacity to accommodate an academic Management at Cornell University in to business school expecting to community’s peak traffic times. For Ithaca, New York, think they have “plug in” to a network. Installing corporations, this time is roughly 9 the answers. Since they fully inte- ports should no longer be a priority. a.m. to 5 p.m.; however, a university grated a wireless local area network Include enough access points. Any large- population works differently. At the (WLAN) technology with the univer- scale deployment requires access Johnson School, peak times happen sity’s existing network of wired and points that provide a great coverage between 12 p.m. and 2 p.m., and be- wireless technologies provided by area, but those points are inexpensive tween 7 p.m. and 2 a.m. Cisco Systems Inc., they say they to install and maintain, says Baradet. Consider additional features. A wireless have lessons to share. LAN alone may not meet a busi- “Wireless on a school campus ness school’s needs. For example, has moved beyond the ‘tipping professors may want to limit stu- point,’” says Kevin Baradet, chief dents’ usage of wireless devices technology officer at the Johnson during classes. A wireless solu- School. Unlike a typical technol- tion that provides separate net- ogy adoption curve, which is slow works to faculty gives them addi- and steady, the “big bang” of wire- tional control in the classroom. less chips preinstalled on laptops Integrate with current technology. resulted in a significant critical mass No business school should build of students and faculty requiring a wireless network from scratch, wireless access, he says. “I think or be required to endure mas- this time last year, all the top business A state-of-the-art wireless network sive upgrades when technology schools were surprised by how fast stu- needs to operate with the same quality changes. It’s wise to choose a solu- dents shifted from wired to wireless of service of a wired network. It tion compatible with past and future technology,” Baradet says. “In May should not resemble a cellular network technology. 2003, our students were carrying drop which often has gaps in coverage. The Develop a partnership with vendors. cables and plugging into wire ports. Johnson School, for example, has 32 Chantry Networks is still heavily By December 2003, nobody had access points, which can handle 1,000 involved with the evolution of the them or wanted to use them.” simultaneous users checking e-mail or Johnson School’s wireless network, As a result, the Johnson School doing light Web surfing. At peak says Baradet, which will make the spent last year “catching up” to stu- times, the network handles around school’s transition to future technol- dents, says Baradet, but now the 300 simultaneous users. ogy more seamless. The company school is ready to go. To complete its Pay attention to building materials. The also benefits from an ongoing part- own transition from wired to wireless, concrete in older buildings can block nership, he adds. the school used BeaconWorks signals. Access points must be numer- “We’ve become a development WLAN, a product of Boston-based ous enough to circumvent these ob- partner for its product,” Baradet says. Chantry Networks. Before a full roll- stacles and provide full coverage. “We’ve given the company a lot of out of a wireless community, however, Develop networks collaboratively. Suc- feedback and are essentially a testing Baradet notes that any business school cessful wireless networks are devel- lab. Chantry’s staff see things happen- should address a few key issues: oped using a collaborative, rather ing here that they couldn’t imagine or Understand user needs. The latest lap- than a top-down, process. Provide a create in their own testing environ- tops and handheld devices often need liaison who will hear and voice the re- ment. So, they gain the knowledge to tweaking to access the network. quirements of users throughout the make the product even better.”

48 BizEd JANUARY/FEBRUARY 2005 SUCCESS [n. The accomplishment of goals necessary to achieve a particular task, realize a particular dream or satisfy a (suc*cess") particular need or want. The outcome of effort. From the Latin successus— to succeed.]

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I NNOVATION I S O UR T RADITION

Teaching Ethical Hacking work. They will also learn the secrets ponent. In addition, students must to hacking into almost any system sign a legal agreement, which states Computer hackers, who seek out vulnerabilities from some of the most talented—and that they will not misuse or reveal any in computer systems to harvest valu- benevolent—hackers in the world. As of the tactics they learn. able data such as credit card informa- “ethical hackers,” students also will As “white hat” hackers, these stu- tion, are believed to cost global busi- learn the legal and ethical considera- dents may perform a valuable service ness billions of dollars annually. A tions that arise in cybersecurity. to industry. Companies are paying recent study by Good Harbor Con- The course is modeled after pro- such hackers to examine their systems sulting, a firm based in Virginia, grams offered primarily by military and identify any security weaknesses found that corporations now spend institutes, says Bill Chu, the profes- before “black hat” hackers have a up to 12 percent of their technology sor of information technology lead- chance to access sensitive information. budgets on security, up from 3 per- ing the course. “This particular cent only five years go. course will expose our Making Dot-Coms History In response to this D A T A B I T students to dark-side trend, some graduate stu- Cybersecurity is becoming a techniques. They’ll gain Researchers at the University of Maryland’s dents at the University of big business. In a recent insight on how bad guys Robert H. Smith School of Business North Carolina at Char- study, Computer Security In- can penetrate systems in College Park have received a lotte want to learn to beat stitute (CSI) projects that the and they’ll learn how to $235,000 award from the U.S. hackers at their own number of jobs in cybersecu- effectively protect those Library of Congress. The goal is to game. In a course called rity will grow at an annual systems,” says Chu. strengthen a two-year-old initiative Vulnerability Assessment compounded rate of 14 per- “We’re teaching them to to preserve records from the now- and System Assurance, of- cent until 2008. It also esti- think like the bad guys. historic dot-com era of the late 1990s. fered through UNCC’s mates that by 2008 the They’re learning a differ- The award will be supplemented by College of Information number of cybersecurity pro- ent mindset.” $245,000 in contributions from the Sciences, students will fessionals will be 2.1 million, The course follows a project’s partners, which include the learn how to defend and up from today’s 1.3 million. case-study format and in- Center for History and New Media secure a computer net- cludes a strong lab com- at George Mason University in Fair-

BizEd JANUARY/FEBRUARY 2005 49 Technology

fax, Virginia (www.chnm.gmu.edu); plans for Duke’s Fuqua School digital library Internet Archive of of Business, says Nevin Fouts, San Francisco, California (www associate dean of information .archive.org); and computer foren- technology. Still, Fuqua’s IT sics firm Gallivan, Gallivan & department is watching the O’Melia of Seattle, Washington iPod program with interest as (www.digitalwar room.com). iPods Come to Campus it looks for ways to leverage next-gen- The Smith School will use the eration devices, he says. funds to develop a digital repository Laptops, PDAs, and mobile phones have “We meet regularly with a stu- to house business records and other become fixtures on most campuses, dent technology advisory council of materials collected through the Busi- serving as important conduits of edu- handpicked MBA students who ness Plan Archive (BPA), which was cational and administrative content work with us to develop Fuqua’s launched in 2002. On its Web site for faculty and administration. But technology environment. We’ve also businessplanarchive.org, the BPA should the Apple iPod be added to been working with companies to contains venture presentations; busi- that list? Better known as a tool for help us find useful technology that ness, marketing, and technical plans; the music industry than for educa- goes beyond laptops and handheld and other documents from more tion, the device is a standard gadget computers,” says Fouts. “We’re try- than 2,000 failed and successful for this year’s freshmen at Duke Uni- ing to find the right technology to Internet startups. versity in Durham, North Carolina. extend the MBA experience in a Some estimates suggest that nearly Last fall, about 1,800 Mac- and PC- very transparent way.” 30 percent of all business records compatible iPods were distributed to produced today never touch paper. freshmen and other university staff. NEWSBYTES As a result, recording business history The iPod project is part of a pilot requires the active preservation of program between Duke and Apple ■ .EU DOMAIN COMING SOON digitally produced materials. “The Computer that will be evaluated after The long awaited “.eu” domain, for need to save these materials is evi- a year. The cost of the project is esti- companies that want to incorporate dent,” said David Kirsch, the proj - mated to reach at least $500,000 and their affiliation with the European ect’s lead researcher and assistant will be covered by strategic planning Union in their Web addresses, will professor of entrepreneurship at the funds that the university has set aside be available in 2005. During an ini- Smith School. “Our team will help us for one-time innovative technology tial two-month “sunrise” period, figure out what can be saved, what purposes. Students can use their only companies in the 25 EU coun- should be saved, and exactly how iPods to listen to foreign language tries that own registered trademarks best to do it.” exercises, review recorded lectures, on their names will be allowed to In the second phase of the BPA take verbal notes, or record inter- register their addresses. This meas- project, researchers will collect de- views. Campus publications could ure has been tailed personal narratives from those also use the medium to distribute taken to who were directly affected by the In- audio editorial for students. thwart “cyber- ternet boom and bust. Entrepreneurs, “We’re approaching this as an ex- squatters,” employees, customers, suppliers, in- periment, one we hope will motivate who register vestors, and others can complete a our faculty and students to think cre- Web addresses survey at www.dotcom archive.org, atively about using digital audio con- using well- the BPA’s companion Web portal. tent and a mobile computing envi- known names The official name of the Library ronment to advance educational of companies or individuals and then of Congress program is the National goals,” says Tracy Futhey, Duke’s vice attempt to sell them back to the Digital Information Infrastructure president for information technology trademark holder, often at exorbitant and Preservation Program. More in- and chief information officer. prices. After the sunrise period, any formation about NDIIPP is available Could the iPod make its way to EU resident or company can register at www.digitalpreservation.gov. the business school? It’s not yet in the a domain name with the .eu suffix.

50 BizEd JANUARY/FEBRUARY 2005 Educational Benchmarking Quality Assessments for Management Education to Support Accreditation & Drive Continuous Improvement EBI Assessments were developed in cooperation with AACSB to support accreditation efforts. Since 1994 over 450 institutions have benefited by participating in our Management Education Benchmark Assessments in such areas as: Student Exit, Alumni, Employer and Faculty for both MBA and Undergraduate programs. For more information visit: www.webebi.com or Contact Viviana Harper at 417.866.7163 or email [email protected]

■ VIRTUAL CAREER GUIDANCE is now available for its bachelors- dents and faculty can access the EM LYON, a business school and masters-level students, and even- wireless network from any point on located in Ecully, France, recently tually will be extended to all EM its five campuses. launched its Career Centre, which LYON graduates. integrates EM LYON’s virtual cam- ■ GOING AFTER GOOGLE pus and software from Quebec-based ■ LAPTOP DAY AT ST. JOHN’S Although Microsoft is a dominant Technomedia. The Career Centre Last semester, St. John’s University force in software technology, there’s offers a three-stage process. First, distributed close to 3,700 laptops to one area where it lags behind: search students use online self-assessment entering freshmen. Although this engines. Microsoft mogul Bill Gates tools, including a 360- was the second year of has announced the company will degree assessment and D A T A B I T laptop distribution, it soon launch a search engine to give personality testing tools. Reuters reports that the city- was the first after the the current search engine leader Second, students move wide wireless network expansion of the Google, a run for its market share. on to training tools that planned for Taipai, Taiwan, school’s wireless com- teach them how to work will be able to accommodate puter network to cover with recruiters, look for a the city’s 2.6 million resi- all indoor and outdoor job in a global market, dents, include up to 20,000 areas of its campuses in Microsoft’s new search engine will research a company, and access points, and cost $70 Queens, Staten Island, initially search 5 billion indexed Web write a resume and cover million. The network is being Manhattan, and Oak- pages. In a preemptive strike, Google letter. Finally, students built by Taiwan’s Q-Ware dale, New York, as well has doubled its capacity to 8 billion can access a network Corp. with help from HP, as its campus in Rome, pages. Google presently holds 36.1 of personal development Intel, Microsoft, and Cisco, Italy. With last year’s percent of the market; Yahoo, 30.6 professors and career and is scheduled to be opera- contingent of 3,400 lap- percent; and Microsoft, 14.4 percent, professionals. EM tional by the end of this year. tops already in use, according to the U.K.’s The Daily LYON’s Career Centre more than 7,000 stu- Telegraph. ■z

BizEd JANUARY/FEBRUARY 2005 51 Yo r Turn u by Margaret Ruggieri

electronic copy of the slides to Take the SMART Board, the From Chalkboard Angel, our school’s course manage- electronic chalkboard (minus the to SMART Board— ment system, for later review. white dust) that allows you to The reality is that attempting to “save” all the material you’ve and Back excite, motivate, and engage young erased. This tool works well in the minds in the world of accounting classroom and it’s fun to use. But it Before I leave my office every morning to can be a daunting task. The fact that has some limitations. First, it’s often impart accounting knowledge to most of today’s students have been not large enough to display all the eager young minds, I go through my raised on video games, MTV, and necessary material—say, all the steps mental checklist to make sure I cell phones makes the job downright to a complex accounting problem. haven’t forgotten anything: thumb intimidating. Of course, our role as Second, I’m a visual teacher, and I drive with PowerPoint presentation, educators isn’t to entertain, but I’ve like to have my PowerPoint slides remote mouse, transparencies. I found that the more exciting the visible as I demonstrate a problem make sure I have hard copies of the presentation for student distribution, textbook, lecture notes, attendance sheet, and last but not least, chalk. AS WITH MOST THINGS IN LIFE, Chalk? Yes, chalk. This professor finds that, even with so many high- TOO MUCH OF A GOOD THING tech tricks in her bag (and these days that bag gets pretty darn heavy), RUNS THE RISK OF BECOMING some low-tech tricks are still relevant to effective teaching and successful BORING. TECHNOLOGY ATTRACTS learning—and sometimes, they’re even necessary. THE MOST ATTENTION WHEN IT’S To set the record straight, I’m not opposed to advances in technol- NEW. WHAT HAPPENS WHEN THE ogy. Rather, I embrace them. I try to take advantage of any opportunity TECHNOLOGY ITSELF BECOMES to learn a new software application or technique that has the potential OLD HAT? OR WORSE, AN to enhance student learning. For example, my remote mouse allows OBSTACLE TO LEARNING? me to move around the classroom Margaret Ruggieri while lecturing, giving the class more “action.” PowerPoint slides classroom experience, the more on the blackboard—not possible allow me to make more efficient use focused the students are and the bet- when switching between of class time and give lectures that ter they grasp complex material. PowerPoint and the SMART Board. are not only easier to follow, but also Thus, using technology in the class- Third, I often don’t need to save more interesting for students. In room keeps everyone awake and the material at all, since I like to fact, during the first semester I used interested. start fresh with each class so the stu- PowerPoint, I received unsolicited But as with most things in life, dents can build the solution them- positive comments from more than too much of a good thing runs the selves. For this professor, the 50 percent of my students. They risk of becoming boring. Technology SMART Board isn’t always quite liked that I provided them hard attracts the most attention when it’s smart enough! copies of the slides, which allowed new. What happens when the tech- Or consider the range of electron- them to take notes easily and pay nology itself becomes old hat? Or ic review materials we now have closer attention, and that I posted an worse, an obstacle to learning? available. An essential component to

52 BizEd JANUARY/FEBRUARY 2005 The person most accounting courses is a review of homework problems to reinforce chosen to the covered material. Electronic solu- tions that publishers provide are an create America’s first easy way to provide answer keys to students, especially with course man- agement software such as Angel, public auditing standards WebCT, or Blackboard. But what works best in the actual classroom? comes from a place My experience has been that elec- tronic solutions cannot be enlarged enough for classroom use—if any that’s been setting student beyond the front row wants to see them, he needs a pair of standards for years. binoculars. I can zoom in, but then only a portion of the solution can be seen, which wreaks havoc on explaining more complex problems. So I go back a technological gen- Baruch. eration. Solution transparencies work well, since enlarging the entire prob- lem merely requires moving the cart with the overhead projector up the aisle. Such a low-tech solution bene- It was no surprise to us that Douglas Carmichael was fits not only my front-row students, but also any sleeping beauty in the chosen to be chief auditor of the Public Company back of the class. Accounting Oversight Board.We chose him first.This I don’t disagree that technology award-winning author had been a professor at Baruch has become an indispensable addi- for over twenty years,the kind of world-class professor tion to the classroom. But what hap- pens the day I walk into the high- we actively seek. Because,at Baruch, we believe a great tech classroom with thumb drive education begins with great faculty. and remote mouse in hand, ready to deliver a chapter’s worth of material, and the classroom computer isn’t functioning or the keyboard battery is dead? Or the day my students are just in the mood for something dif- ferent they haven’t seen in a while? These are the days I’m glad I packed my entire bag of tricks. I go back to first-generation teaching technology and pull out that old reli- 646-312-1300 ● http://zicklin.baruch.cuny.edu able piece of chalk. ■z THE AMERICAN DREAM STILL WORKS. Margaret Ruggieri is an assistant professor of accountancy at Providence College in Providence, Rhode Island.

BizEd JANUARY/FEBRUARY 2005 53 Bookshelf

Inventors are odd people, but not just sands of elite eighth habit is really an exhortation because they wear big glasses and employees at to every individual: Find your voice plastic pocket protectors and spend companies and inspire others to find theirs. That all day tinkering in their basements. around the habit, whether developed at home, No, inventors are odd because their world, Annun- in the office, or in any other setting, minds are constantly zio describes the ideal workplace for will create a passionate worker com- teasing at problems. high-performing work groups: one mitted to a full life—and extraordi- In Juice, Evan I. that values people, optimizes critical nary productivity. (Free Press, $26) Schwartz picks thinking, and is open to seizing through the brains of opportunities. These high-caliber Everyone has an opinion about the forces dozens of inventors, workers perform best in a specific shaping higher education, but Frank from famous ones environment in which a high pay- Newman, Lara Couturier, and Jamie like Alexander check is not the most important fac- Scurry are more quali- Graham Bell to tor to employee happiness; in fact, fied than most to offer lesser-known individ- it’s ranked fifth after satisfaction with theirs. They are all uals like Jay Walker, the company’s values, teamwork, involved with the who came up with Priceline.com. people, and planning. Annunzio Futures Project: Policy Inventors are driven by a Jungian offers case studies of work groups for Higher Education instinct to play—an almost irre- that have performed at high levels, in a Changing World, sistible desire to take things apart as well as detailed information about a think tank based at and put them together in a new her survey. Any team leader should Brown University. In way—and yet their inventions will be pay heed. (Sentinel, $24.95) The Future of Higher meaningless unless they focus on Education, they lay problems that actually need solu- Stephen R. Covey, author of the best-selling out some of the mar- tions in markets that can bear inno- book The 7 Habits of Highly Effective ket forces shaping the university sys- vation. While inventors are a special People, is back with an addendum: tem, from privatization to globaliza- breed, it’s not just mad geniuses The 8th Habit. Taking a hard look at tion to sweeping technological inno- who can come up with great ideas. the knowledge economy, and the vations. The biggest factor, however, “Invention is a set of strategic think- paradigm shift necessary to harness is the gradual shift to a market ing tools that you can teach, learn, the full productivity of the modern mindset for colleges and universities, and practice,” writes Schwartz. employee, he offers a treatise that is as they compete for students, rank- Modern-day inventors have largely alternately thoughtful, inspirational, ings, and prestige. The result is that been subsumed into R&D depart- and uncompromising. “The both schools and state governments ments, Schwartz notes. “In 1940, Knowledge Worker Age will eventu- will need to rethink their policies the U.S. Census Bureau actually ally bring about a downsizing of up about education and how it is eliminated ‘inventor’ as a separate to 90 percent of the Industrial Age offered. State leaders need control of job category.” But more than a workforce,” Covey two factors, the authors write: “mis- few individuals know that the predicts. But nei- sion and a range of workable means position still exists. (Harvard ther management of assessing institutional perform- Business School Press, $24.95) nor the workforce ance.” According to them, “What has yet figured out institutional leaders need is greater “Treating people well makes money,” the best way to autonomy in the operation of the says Susan Lucia Annunzio in engage that knowl- institution to fulfill the agreed-upon Contagious Success. She’s not edge worker, who mission.” Many of the ideas will be the first person to think so, but wants a job that will familiar to anyone anxious about the she might be one of the first to satisfy his body, state of higher education, but that have empirical proof. Drawing mind, heart, and does not make them any less force- results from a survey of thou- spirit. Covey’s ful. (Jossey-Bass, $33)

54 BizEd JANUARY/FEBRUARY 2005 “How fast do you read? Internet entrepreneurs— research that lead to strategic seg- Depending on your who compressed a whole mentation. (Haworth Press, $19.96) answer, by the time you life cycle of learning, suc- finish this book, Wal-Mart cess, and failure into a Every aging population views members of will have opened one, two, span of a couple of the upcoming generation with a three or more stores.” years—as well as veterans low-level dread, believing they can- That’s just one of the of long-established not be as hard-working, passionate, nuggets contained in What organizations such as The or collaborative as their own con- I Learned From Sam World Bank and Jet temporaries. So it’s no surprise that Walton, written by former Wal-Mart Propulsion Laboratory. Although baby boomers look with horror on executive Michael Bergdahl. But some of their conclusions are obvi- the video gamers just now muscling Bergdahl isn’t interested in merely ous—experience is the best teacher, their way into the work force. After wowing readers with facts about for example—the questions they ask years of sitting numbly before com- Wal-Mart’s juggernaut success. He are thought-provoking. While we puter screens wants to offer potential Wal-Mart know experience matters, they write, immersed in violent competitors concrete advice about do we appreciate its importance in fantasy worlds, what how to compete with the retail “designing our own careers, in man- could gamers have to giant. He’s devised a strategy for aging the careers of others, or in offer to the work- “picking Wal-Mart’s pockets,” building and retaining deep smarts force? Plenty, accord- which, conveniently, spells the word within our organizations?” (Harvard ing to John C. Beck POCKETS. Readers come to under- Business School Press, $29.95) and Mitchell Wade in stand Wal-Mart strategies on price, Got Game. They con- operations, culture, key item promo- In today’s highly differentiated world, it’s ducted interviews tion, expenses, talent, and service. virtually impossible to sell the same with thousands of The chapter on pricing, for instance, product to everybody. There are too business professionals, details Wal-Mart’s commitment to many markets, too many competi- men and women, who were gamers rock-bottom prices and then states tors, and too many customers with as teenagers, to determine if the point-blank that no one can com- specialized needs. But how does a video gaming experience changed pete with the company head-to-head CEO determine who his customers their attitudes and expectations on pricing. “The key is to find a are and how to find them? Art about work. The answer is: niche ... within your area of expert- Weinstein provides a guide in absolutely—and often in a positive ise, with products and services not Handbook of Market Segmentation, way. Gamers are confident, competi- offered by Wal-Mart.” It’s a great which focuses on the high-tech and tive, high-performing, multitasking, read for anyone interested in how industrial markets. Weinstein and at least as social as nongamers. Wal-Mart has reshaped the landscape demonstrates how executives can Playing self-centered games in which of retailing. (Wiley, $24.95) zero in on their niche markets by they are called upon to do heroic considering geographic tasks leads them to appreciate “fac- Through what combination of location and product ing a challenge with real teeth, experience and innate lines while determining if where the reward is partly in service intelligence do people a market is penetrated, to some larger cause.” Why is it develop the skills and untapped, generic, or rel- important to understand what moti- knowledge to be excellent evant. Too many firms vates former gamers? Because, leaders? Dorothy Leonard “still base their marketing according to the authors, they make and Walter Swap call that plans on cursory, incom- up 81 percent of the workforce of kind of knowledge Deep plete, or intuitive market people 34 years old or younger, a Smarts and have written a analysis,” he writes. huge portion of today’s employees. book about the process of What’s required, he says, (Harvard Business School Press, acquiring it. They studied is the sound planning and $27.50) ■z

BizEd JANUARY/FEBRUARY 2005 55 Spotlight

Building on a Rich History

College of Business and Information Science Tuskegee University Tuskegee, Alabama

When Booker T. Washington founded Tuskegee University in 1881 as the Tuskegee Above left: a TU campus landmark. Above: Normal and Industrial Institute, its undergraduate business students at purpose was to train newly freed Tuskegee’s CBIS. Left: Dean Alicia Jackson. slaves as teachers. Washington want- ed its students to become intellectu- marketing department is according to the customer ally stimulated and return to their specifically designed to specifications,” says Jackson. communities to educate others. As produce professional “The business students one of the historically black colleges salespersons, so the major stepped in to say, ‘No, this is and universities (HBCUs), Tuskegee focuses on the sales func- what the customer wants.’” created its first department of busi- tion and customer rela- CBIS also hosts the annual ness in 1962; that department tionship management,” she explains. Booker T. Washington Eco nomic became a college in 1984 and The school is also steadily growing its Development Summit, which brings received AACSB accreditation in hospitality management program. together representatives from the 1998. Students in the program train at business school, government, com- Today, the school’s College of Tuskegee’s Kellogg Conference munity, and professional groups. Business and Information Science Center, which school representatives Speakers offer information to small (CBIS) serves approximately 450 say is the only such luxury hotel facil- business owners to foster entrepre- undergraduate students, including ity located at an HBCU. neurship in the local community. 360 business majors and 90 comput- In its effort to integrate disci- Going forward, steady growth is at er science majors. The CBIS offers plines, the school hosts its annual the top of the school’s agenda. The eight majors in accounting, business Tuskegee University Business and school wants to add majors in manage- administration, economics, finance, Engineering Conference, which is ment of information science and supply management science, sales and mar- staged entirely by business and engi- chain management. In addition, the keting, hospitality management, and neering students. The objective, says business school is currently raising computer science. Bringing together Jackson, is “to show how the two funds for a new facility, a goal aided by principles of business and technolo- processes work together, so that a $2 million gift from Procter & gy is at the forefront of the school’s business students learn principles of Gamble. Estimated to cost $12 million, mission, says Alicia Jackson, dean of engineering and engineering stu- the new building will boast 45,000 the college. “So many businesses are dents learn principles of business.” square feet and bear the P&G name. growing around the area of technol- This year, for example, aerospace Most important, Jackson wants to ogy and biotechnology,” she says. company Raytheon gave students a see her business school gain greater “We wanted to combine the two special challenge: Put a robot togeth- recognition beyond its local region. programs.” er from its components, according to “It’s difficult for a small school to Among the college’s core pro- customer specifications. As a result, gain national recognition, but this is grams, its sales and marketing pro- the students learned there was more a goal I’ve shared with the faculty,” gram is unique, says Jackson, because than one way to approach such a she says. “I know how great this it does not isolate the marketing project. “The engineers wanted to school is—now it’s a matter of let- major as its own discipline. “Our put it together, but not necessarily ting the world know.” ■z

64 BizEd JANUARY/FEBRUARY 2005