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126 ALUMNI MAGAZINE

July-September 2012 www.iese.edu

Domènec M elé Jorge Soley Morten Olsen Mapping the Path Towards a New Protecting the Few at to Excellence Banking Model the Expense of the Many

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ideas People Business EthicS MBA Programs Graduation Mapping the Path to Excellence Domènec Melé 18 Banking Reform Opening the Door Towards a New Banking Model Jorge Soley 22 to a New Future 56

Labor Market Reform Protecting the Few at the Expense of the Many Morten Olsen 26

crossroads People International Conference International Julio Rodríguez (PDG ’97) MBA Programs: Taking “You Need New Goals on the Future 36 Advisory to Keep the Thrill Alive” 52 Symposium on Ethics, William F. Baker Business and Society Board Going Out of Print 62 Global Business and Universal Values 40 Growing 17th International Case Competition Pains Nine Schools, One Case Study 42 14th Luxury Goods Industry Meeting Social Networks Trace the Future Frontiers of Luxury 44 AGENDA 2012-2013 49

C R O S OS R OI A D S ACADEMIC SESSIONS AND WORKSHOPS Sign up ACADEMIC SESSIONS EXTEND FROM A TO Z… 3, 2, 1… THE COUNTDOWN BEGINS FOR THE GLOBAL ALUMNI REUNION BRAZIL 2012 A PERFECT COMBINATION: LEARNING AND NETWORKING LEADERS OF CHANGE YOUR VISIT The Global ere Alumni are many Reunion other interesting this year is presenting a different and unique program in which, as well as stimulating academic sessions, The academic program is divided into six panels, each of which will discuss the key issues there willcities be thata series fall within of workshops Sao Paulo’s that will analyze the personalnow! and professional challenges for investing in Brazil. affecting business and the economy. Take advantage of sphere of influence which you can your visit to get to Get to know Brazil visit to get to know Brazil better. PROFESSOR know Brazil, the land GERALDO ALCKMIN 19.00h AFTERNOON EDUARDO GOVERNOR of opportunities. Add MARTÍNEZ Health, technology, energy, finance, RECEPTION AND OF SÃO PAULO MORNING 16.00 h a few days to your ABASCAL globalization and, of course, we couldn’t do 8.30 h Why go to Brazil this year? An intense WELCOME Brasilia GUIDED TOUR OF SÃO PAULO without a panel on big events. Leaders, visit to Sao Paulo to e federal capital, it has the ONLINE make trips to other IESE in Latin Palácio dos Bandeirantes WORKSHOPS “INSIDE BRAZIL” The Barrio Oriental, the Plaza and the business people, executives and academic program combined with honor of being the only city built in 21.30 h important cities such In the presence of the ISE REGISTERCatedral da AT Sé in the city center, the entrepreneurs will share their views of the the 20th century to be declared a GALA DINNER as Rio de Janeiro governor and mayor Higienópolis and Morubi districts, the present and their vision of the future. There’s America networking opportunities and cultural Unesco Heritage Site. Investing in Brazil http://www.iese.edu/global (population 6 million) of São Paulo museum of precious Brazilian stones, no doubt that they will be six panels full of Buffet Torres IESE’s Latin American community alumnireunion and Curitiba activities is a way to immerse your- Talent the financial center, the Municipal new ideas that, as at all assemblies, will be 19.00h (population 1.7 comprises nine associate schools Entrepreneurs Market… inspiring and oriented towards action. self in Brazil, a major international Curitiba MASS million). Share the in nine countries 1 NOVEMBER 2 NOVEMBER 3 NOVEMBER Situated on the high Paraná plain, diversity and economy. The Global Alumni Reunion it is the biggest city in the south of dynamism of the MEXICO the country and one of the richest FLIGHT DISCOUNTS IPADE (1967) country that is welcomes everyone from IESE’s Latin in Latin America. 1.00h 1.00h 7.00h 7.00h 3.00h 3.00h 5.00h 5.00h 4.00h 4.00h 2.00h 2.00h 8.00h 8.00h 6.00h 9.00h 6.00h 9.00h shaping the third 11.00h BEST OFFERS 11.00h 17.00h 17.00h 13.00h 13.00h 15.00h 15.00h 14.00h 14.00h 21.00h 12.00h 21.00h 12.00h 21.00h 18.00h 18.00h 16.00h 19.00h 16.00h 19.00h 19.00h 23.00h 23.00h 23.00h 10.00h 10.00h 24.00h 24.00h 24.00h 22.00h 22.00h 22.00h 20.00h 20.00h 20.00h American community. AVAILABLE millennium. Guaruja http://axbv.net/iese/ BLOG e third biggest island off the index_english.html STAY UP ACADEMIC SESSIONS COLOMBIA coast of Sao Paulo, it is a spa that TO DATE Sheraton Sao Paulo WTC Hotel GUATEMALA INALDE IESE’S GLOBALis 4.27 meters above sea level. UNIS (1977) (1985) ALUMNI REUNION http://blog.iese.edu/ chartingpaths/ IS HELD ANNUALLY ALTERNATING Piracicaba An important industrial (metal, BETWEEN ECUADOR Atlantic machinery, textiles, food and fuel) CHARTING PATHS IDE (1992) Ocean BARCELONAand agricultural AND center situated in IN E-HEALTH CHARTING THE IMPACT MADRID. one of the most productive GLOBALIZATION regions in the state of Sao Paulo. OF THE WORLD’S ICONIC CHARTING TRUE DR. LLUÍS DONOSO EVENTS THE ENERGY “CONNECTEDNESS” BRAZIL SINCE 2000, EVERY Director of the Diagnostic Imaging Edwin Moses Department, Hospital Clínic in SECTOR, CHARTING ACROSS BORDERS AND THREE YEARSRio IT de Janeiro EDUARDO PAES EDUARDO PAES. Graduate in Law from the Law 70.460 Barcelona TRANSFORMATION? CONTINENTS 52.709 HAS eBEEN former HELD imperial capital and the Mayor of School at the Pontifical Catholic PERÚ THE PATHS OF country’s second biggest city,GIOVANNI Rio CERRI Update your Río de Janeiro University of Rio de Janeiro PAD COUTSIDE SPAIN INNOVATION AND IESE CHAPTERS IN THE WORLD 2,6 is Latin America’s premier touristSecretary for Health, São Paulodetails and and win (PUC-RJ). Began his political PAULO RICARDO STARK PANKAJ GHEMAWAT (1979) GERHARD HEIBERG destination and the first OlympicDirector of the Institute of Radiologya dinner for your SOCIAL NETWORKScareer in 1993 when he was only TECHNOLOGY IN Executive president. Siemens Brazil Professor of Strategic Management Brasilia 2000 Amsterdam Member of IOC UNITED city in South America.of the Hospital das Clinicas, Schoolcohort 23 . He currently works out of the THE WORLD OF MEDIA EDUARDO MARTÍNEZ ABASCAL at IESE 6,3 2003 London and DirectorFOLLOW of mayor'sUS ON… office organizing the of Medicine, University de São Paulo STATES Marketing of the Professor in the department of DANIEL SERVITJE 12.667 Rio de Janeiro (FMUSP) football World UNITED 2006 Munich Internationalhttp://www.facebook.com/alumni.IESE SANTIAGO FERNÁNDEZ VALBUENA finance at IESE since1992 Managing Director of Grupo Bimbo Pacific Santos Cup in 2014 and the Olympic KINGDOM São Paulo 2009 NewYork NÚRIA MAS Olympic Ctte CEO of Telefónica KEES STORM Ocean 1,1 Santos is 60km south of Sao Paulo http://twitter.com/iesealumniGames in 2016. Latin America 1 2012 São Paulo Professor of Economics at IESE PAULO RICARDO STARK. Graduated in Chairman of the Board of Directors, BRAZIL and is the largest port in Latin “I Was the Least Likely America. It also boasts the world’s http://www.linkedin.com/company/ FRANCISCO MESQUITA electrical engineering at the Centro AmBev CHILE iese-business-school CEO Grupo Estadão Federal de Educação Tecnológica do 2 ESE, BRASIL longest waterfront garden, the GIOVANNI CERRI. Trained LLUÍS DONOSO. Gold medal from the Paraná. Member, among DANIEL SERVITJE. Graduated in 3 (1999) ISE (1996) Jardines of the Santos shore. http://www.youtube.com/IESE JORGE NOBREGA ARGENTINA URUGUAY as a doctor at the Spanish Radiological Society. Corporate Vice President, Globo others, of the Advisory business administration from the IAE IEEM School of Medicine of Honorary member of the Argenti- SOURCE: Board of Nokia Siemens Universidad Iberoamericana. (1978) (1986) São Paulo University. Is nean Radiological Networks and the MBA from Stanford Instituto Brasileño São Paulo SANTIAGO FERNÁNDEZ VALBUENA. de Geografía y currently president of Society, Mexican Advisory Board of the University. Joined 15% of students e biggest city in Brazil and Latin Graduated in economics from MBA Estadística the Cancer Radiological and Brazilian Electrical and the board of Grupo following the America. It is the country’s SPONSORS the Universidad Complu- financial center and oneCouncil of the at São Imaging Society, Electronics Bimbo in 1991. In IESE MBA GDP for 2009 PLATINUM: Ricoh CHARTING PATHS IN tense, Doctor and Masters most important in thePaulo world. State, and image, the Industry Associa- 2011, he was voted in million of € in Economics at Northeas- program in University GOLD: Ajuntament de Barcelona Italian Radiological THE FINANCIAL Person to Become an tion (ABINEE). “Personality of the tern University in Boston. Barcelona are in São Paulo. Society, the French INDUSTRY AND THE Year” by Expansión SILVER: Ermenegildo Zegna / Before joining Grupo Latin Americans Millions of Radiological Society TURBULENT magazine. IESE associated business schools (year founded in brackets) inhabitants in 2010 Singapore Airlines and the German Telefónica he was managing Radiological MACROECONOMIC director of the Société Society. ENVIRONMENT Générale Valores and PANKAJ GHEMAWAT. Author of the Director of the Stock celebrated book World 3.0, for which he # 2 4 5 6 8 MIGUEL JORGE Exchange in Beta received the 50 Thinkers Book Award, Brazil in Brazil’s former minister of Capital in Madrid. he was also the youngest guru in the list world industry and external trade of top thinkers of all times published by 64 The Economist in 2008. He is the author DIRECT ECONOMIC EXPORT GROSS Olympic Champion” rankings of more than a hundred articles and FOREIGN INTERNET FORECAST OF RAW TELEPHONE MOBILE GOLD AND SIZE OF DOMESTIC 3, 2, 1…INVESTMENT THEUSERS 2020/30 COUNTDOPOPULATION MATERIALS LAND MASS LINES TELEPHONESWCASHN RESERVES WORKFORCEBEGINSPRODUCT FOR THE case studies. GLOBAL ALUMNI REUNION BRAZIL 2012 Sergi Quinto (MBA ’98) Get to Know Brazil 50 32 The Bargain Machine 70

2 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE COVER STORY

painful but necessary reforms facing up to change 8

Life Life

AMP MUNICH Graduation the class of 2012 Europe’s New Leaders 78 AMP Warsaw Graduation united Putting on the Polish 79 Dean visits ASIA by diversity The Eastern Horizon 80 72 steadfast supporters 25th Annual Meeting of Sponsoring Companies, Chairs and Research Centers 82 WSJ Breakfast Series Michael Bloomberg, Erskine Bowles and Alan Simpson 86 Chapter News 88

You’re in the news 90

MBAS RETURN 430 Alumni Converge on Barcelona 92

final word Josep Tàpies “To do” 96

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 3 www.facebook.com/alumni.IESE www.twitter.com/IESE.alumni 126 General Circulation July-September 37,326 2012 International Circulation Alumni Magazine www.iese.edu/alumni 31,401 (Spanish Edition) 5,925 (English Edition) Editor Antonio Argandoña Index of Companies Executive Editor Aïda Rueda Acne Studios...... 44 IMD...... 36 Sara Lee...... 56 Managing Editor Olga Boluda At Stake Advisors...... 44 INSEAD...... 36, 42, 44 Savigny Partners...... 44 Senior Editor, English Edition Bluemap Consulting ISS Facility Services...... 40 Schneider Electric...... 52 Stephen Burgen Group...... 90 Kathe Kruse Puppen...... 32 Schroeder...... 32 Art Director Belén Sanz Bonnier AB...... 32 Kia Motors...... 90 Siemens...... 36 CA Chevreux...... 44 KPMG...... 47 Sony...... 90 Contributors Cristina Aced Capgemini & La Montre Hermès...... 44 Swarovski...... 44 Marisa Bombardó Consulting...... 88 Leroy Merlin...... 90 The Boston Consulting Mercedes Castelló Catholic University Lloyds Bank...... 64 Group...... 36, 44, 56, 86 Clara Castillejo Nicholas Corbishley in Lublin...... 40 London Business The Level Group...... 44 Tomás Crespo CEIBS...... 42 School...... 42 The Royal Bank Alberto de Olano Citigroup...... 32 Made-By...... 44 of Scotland...... 90 Álvaro Lucas Javier Pampliega Columbia University Mango...... 32, 40, 42 ToolsGroup...... 90 Kristina Rodemann Business School...... 62 MAT Holding...... 90 Tripku...... 90 Marta Sardà Diageo...... 90 MBA Arena...... 36 UNCTAD...... 44 Larisa Tatge Miquel Utset Diesel Black Gold...... 44 McKinsey...... 36 Universidad de Ramiro Varea El Corte Inglés...... 56 Microsoft...... 36 Navarra...... 40 Georgeson...... 90 MIT Corporation...... 68 Universidade Católica Cover concept Luis S. Ruiz Gilead Sciences...... 90 Morehouse College...... 64 Portuguesa...... 40 Good Deal...... 70 Motta International...... 32 Universitat de Editing Secretary Google...... 62, 71 Northwestern Barcelona...... 90 Ángeles Frontini Grupo Prisa...... 90 University...... 42 University of London...... 42 Photography Harvard Business Repsol...... 40 University of Oslo...... 32 Javier Arias School...... 36 Richard Ivey School University of Oxford...... 36 Jordi Casañas Jordi Estruch HEC School of of Business...... 42 University of Miquel Llonch Management...... 36 Richemont St. Thomas...... 40 Pili Martínez Roger Rovira Hong Kong University International...... 44 University of Western Fotomobil.com of Science and Roland Berger Ontario...... 42 Tecnology...... 42 Consultants...... 42 Value Retail...... 44 Design and Layout Belén Sanz IAG Group...... 32 Rotterdam School Yale School IBM...... 72 of Management...... 42 of Management...... 42 Infography Ieseg School Saïd Business School...... 36 Yoox Group...... 44 Sandra Villar of Management...... 44 Samsung...... 90 Zardoya Otis...... 90 Illustrations Luciano Lozano (www.ilustracionesposibles.blogspot.com) Index of Alumni Advertising M&N Consulting -Antonio Moré Tel.: 93 544 12 34 Alberdingk Thijm, Garvía, Ruding, Philip (MBA ’89)...... 95 José Antonio (MBA ’81)..... 90 Barbara (MBA ’04)...... 95 Printing Alemany, Herrero, Ángel (MBA ’86)..... 90 Sáez, Carlos (PDD ’10)...... 90 mccgraphics Salvador (PDD ’74)...... 90 Kremer, Dirk (MBA ’84)...... 90 Sansa, Pau (MBA ’09)...... 90 Published by Asegurado, Marsman, Schoen, Oliver (MBA ’05)...... 88 Estudios y Ediciones IESE, S.L. Carmelo (EMBA ’12)...... 56 Bouke (MBA ’04)...... 95 Sherysheva, Depósito legal B.23.746-1963 ISSN 1138/2333 Basterreche, Martínez, Lubov (G-EMBA ’12)...... 56 Iñaki (MBA ’91)...... 90 David (PDG ’07)...... 90 Sive, Peter (AMP ’12)...... 78 The opinions expressed in the articles Burgos, Rafael (PDD ’05)...... 90 Mensa, Josep (PDG ’00)...... 90 Sommen, published in this magazine are solely those Daniels, Chris (MBA ’00)...... 64 Moes, Vanessa (MBA ’12)..... 56 Felix van der (MBA ’10)..... 95 of the authors. Articles may be reproduced, provided that the original source is indicated. Eikelenboom, Quinto, Sergi (MBA ’98)...... 70 Stolarczyj, Martijn (MBA ’88)...... 95 Odile de Visser, Dariusz (AMP ’10)...... 88 Cardona, Astrid (MBA ’90)...... 95 Sturm, Beatriz (EMBA ’09)...... 90 Olavarría, Gerhard (EMBA ’06)...... 90 Cosqueric, Lionel (MBA ’75)...... 88 Summo, Peter (AMP ’12)...... 78 Nicolas (G-EMBA ’12)...... 56 Olivares, Tahiri, Sabrina (PDD ’06)...... 90 Fernández, Joaquín (PDD ’07)...... 90 Taylor, Grant (MBA ’12)...... 56 IESE/University of Navarra Rafael (PADE ’00)...... 90 Parera, Enric (PDD ’09)...... 90 Tomino, Kenji (MBA ’08)...... 80 Alumni Magazine Fernández, Río, María (MBA ’88)...... 90 Tsuji, Teri (MBA ’02)...... 64 Avda. Pearson, 21. 08034 Barcelona Bernardo (PADE ’06)...... 90 Rodríguez, Wouterse, Tel.: 93 253 42 00 • Fax: 93 253 43 43 Cno. del Cerro del Águila, 3 Fuertes, Olga (EMBA ’12)...... 56 Julio (PDG ’97)...... 52, 72 Alexander (MBA ’89)...... 95 Ctra. de Castilla, km 5, 180. 28023 Madrid Tel: 91 211 30 00 • Fax: 91 357 29 13 Numbers refer to the first page of the article in which the alumnus appears. www.ee-iese.com

4 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE AFA4openday_eng 11.06.12.fh11 12/6/12 09:48 P�gina 1

C M Y CM MY CY CMY K

PUBLIcidad 5 E D I T o Rr Ii A L LEARNING ABOUT THE FUTURE FROM THE PAST

antonio ometimes people ask why it is that IESE’s economics professors argandoña are usually clear about what we think in our sessions and always Editor of the Alumni Magazine use the language of the business world, something that we share [email protected] with our colleagues in other departments. My response is that we have the good fortune to be in daily contact with executives and Sbusiness people who are very involved in the school, who have no time to waste and who aren’t interested in theory (well, they like a bit of theory, but just enough to understand what’s going on). These are people who are involved in the present and worried about the future and, if they care about the past, it’s only in order to better understand the future. That’s what our school is like.

This edition of the Alumni Magazine is proof of that. In the cover story, economics and other professors discuss what countries are doing and have to do to get out of the situation we’re in, especially in Europe. It’s not just a question of new policies but of game-changing reforms. Companies need to learn how to operate in a changing environment. The Ideas articles by professors Soley and Olsen review these changes in the financial system and the labor market. And in Crossroads the International Advisory Board discusses the issues of growth and changing strategies at company level.

But not all change is financial. Read the interview with Julio Rodríguez (PDG ‘97) who talks about how IESE helped him raise his game at Schneider Electric. Meanwhile, this year’s MBA graduates relate how IESE has helped them get closer to realizing their dreams. But what I like best about this edition is the humility of Edwin Moses who tells IESE alumni in London “I never imagined I could become an Olympic champion.” He attributes his success to one thing – passion.

6 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE In the Current www.ieseinsight.com/review

Restoring the Human Side of PUBusinessBLIcidad

Writing a Manifesto for Better 7 Management Giving Wings to Your Leadership Style A New Approach to Fix Broken Governance

• Interview With Antonio Urcelay, Toys “R” Us Europe: Plus... “You can’t • Five Keys to Prepare manage for the Business of Aging • Facebook IPO: To Sink by consensus. or Swim When Floating Stock We’re paid to • The Route to Olympic Gold make decisions.” • Kola Real: Taking on the Cola Markets

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Alumni nº13 Insight ESP.indd 2 11/06/12 11:14 C o v e r s T O R Y

painful but necessary reforms facing up to change stephen burgen

8 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE The economic crash of 2008 exposed the wishful thinking behind the project of the European single currency and has revealed the painful truth that sharing the same banknotes doesn’t make us all equal. The stronger members are demanding painful, if often necessary, reforms of its weaker partners in return for financial rescue packages that are costly for all concerned. In this article, IESE professors review the recent changes taking place in Europe and their impact on business. The transition won’t be easy, they say, but they believe it will help the European Union emerge from the crisis with a stronger economy and society.

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 9 C o v e r s T O R Y

reform is a change in the rules of based on theories developed in the 1940s and 1950s, the game that changes a country’s it comprises a series of coherent ideas that are economic strategy. It’s not a good broadly accepted by the majority of citizens, po- idea to change the rules too often, liticians, experts, businesses and trade unions. but sometimes it’s necessary to Germany is an open economy based on exports, not con- get rid of accumulated problems sumerism. Exports also serve as the motor for innovation and to orient the country to cope and the development of other sectors and is itself based with the new conditions in the in- on quality and advanced technologies, not on low-cost ternational economy, says Prof. Antonio Argandoña. products. High productivity contributes to low inflation HeA adds that the economic recovery depends on us. “It’s and a high standard of living. time for reforms,” he says. That said, there needs to be Industrial manufacturing occupies a central role both a plan, because the problems of the European economy in the economy and in employment. And while industrial are not just a result of the juxtaposition of independent policy has favored the growth of large enterprises in order problems, says Prof. Juan J. Toribio, but because these to achieve economies of scale, small and medium-sized problems are interrelated and it is therefore necessary businesses are also solid and thrive by serving the tech- to draw up a plan based on a long-term solution and a nological needs of the big companies. While salaries are global vision because there will be no immediate im- high, wage inflation is not, partly because German taxes provement. He emphasizes that “things cannot be fixed contribute to running a generous welfare state. Wage in- with partial measures, disconnected or separated over flation is kept low through the consensual, rather than time or subject to political horse trading.” confrontational, nature of German industrial relations. Argandoña points to the so-called German mo- The model is based on konzertierte action (concerted ac- del as a possible remedy for Europe’s woes. Although tion) as a way of dealing with problems. In 1952 the policy

10 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE Cutting the Public Deficit

of mitbestimmung ( joint decision making) was introduced merits of budget discipline. Well-defined fiscal objec- in which workers’ representatives are involved in strate- tives, fiscal transpar¬ency and a well-defined process gic decisions along with management. for evaluat¬ing tax and expenditure decisions, may be The unions are strong but they also cooperate with ma- more important to achieving fiscal discipline than bind- nagement, conscious that they need to maintain competi- ing rules and automatic correction mechanisms. Fur - tive advantage if they are to go on exporting successfully. thermore, fiscal sustainability success does not only However, Germany is not the only possible role model. depend on decisions within the fiscal sphere. Long-run In the 1990s, Sweden and Canada faced up to the crisis growth-enhancing reforms are necessary since fis- with a rigorous program of reforms. Other countries, such cal consolidation without growth is very difficult to as Denmark, Germany, Austria and the Netherlands have achieve. adopted similar measures in recent years. In fact, Prof. In the short term, the ability to achieve a large real Xavier Vives recommends that countries struggling exchange rate depreciation that stimulates net exports on Europe’s periphery “copy measures put into place in is important for open economies with serious competi- Sweden, a model country that has successfully achieved tiveness problems. fiscal consolidation and economic growth.” Reform of the fiscal process and growth-enhancing Sweden has gone for devaluation, reduced spend- measures are, at least in principle, feasible in the EU ing, lowering marginal interest rates, deregulating the periphery. This is not the case of currency deprecia- labor market, reforming the public sector, getting rid of tion within the euro area. This means that an internal civil servants and creating public employment agencies. devaluation will be needed to regain competitiveness. The Swedish case suggests several lessons for the EU Wage moderation has to be part of the solution but also periphery, says Vives. For a start, a deep fiscal crisis may reductions in labor social security contributions com- help forge a broad and long-lasting consensus on the pensated with increases in value add tax (VAT) to main-

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 11 C o v e r s T O R Y

tain budget neu¬trality. But this program will still not work if wage bargaining has an inflationary bias since increases in VAT will translate easily into price increases. Economics Labor market reform, particularly in regard to collective wage bargaining, is then an indispensable complement on-line to ensure successful reform. The EU periphery has a more difficult task than Sweden, but coherence in the To keep up to date with economic reforms may eventually bring about success. developments you can read the blogs One of the causes of Europe’s problems lies in maintained by several IESE professors in the difference in the competitiveness of the coun- which they periodically analyze the economic tries within the Eurozone which have been thrown situation from a variety of perspectives. into relief by the financial crisis. The inequal- ity is such that you could now say there are three Eduardo Martínez Abascal: Europes, according to the CESifo 2012 report (see http://blog.iese.edu/martinezabascal below). The first includes Germany, the Nether - lands and Finland; the second, Greece and Portugal Antonio Argandoña: and, in the middle, Spain, France, Italy and Belgium. http://blog.iese.edu/antonioargandona Cutting the Public Deficit IESE Economics Weekly: One of the main problems that the European coun- http://blog.iese.edu/economics ltries hardest hit by the crisis face is the public deficit. There are only two ways of reducing it: increase the tax take and cut public spending, both of which have effects on employment and economic activity, says Toribio.

12 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE “companies need to wean themselves off external finance and in order to do so they will have to grow by using their assets more efficiently” Prof. José L. Suárez ank B R estructuring

The four countries that have accepted a European As we can see, these changes are linked to reforms in rescue package - Ireland, Portugal, Greece and Spain the public sector, which is going through an economic - have all made drastic cuts in public spending, which crisis. Relationships between companies and the public have a considerable effect on social welfare and have sector are going to be very different in the next 15 years, also, especially in Greece and Spain, given rise to increa- says Jordi Canals, the dean of IESE, who says that com- sing social unrest. Increasing the tax take is difficult in a panies “should demand that the government follow recession, in particular in a country such as Spain where horizontal and sectoral and business policies that are unemployment is running at close to 25 percent. consistent over the long term.” Is changing the rules of the game bad news for business? It doesn’t have to be. If some of the reforms being Bank Restructuring carried out in the notoriously bureaucratic countries Alongside these adjustments, Europe’s weaker of the periphery were extended to changing public ad- leconomies need a coherent and integrated econom- ministration, with the simplification of bureaucratic ic policy, says Toribio, and this must include reform of processes, this could lead to a reduction in paperwork the banking and financial sector. He believes the these that would simplify day-to-day management and other economies are still in surgery and need to recover from processes such as setting up a business. the operation before it can run a marathon. The chal- These improvements would allow companies to be lenge is to improve credit flow. more competitive. But for this to happen the govern- What does all this mean for business? The main im- ment and the civil service “would have to be willing to pact is when it comes to seeking finance, says Prof. José help business instead of making things more difficult,” L. Suárez, although banks aren’t the only financial says Prof. Alfredo Pastor, who adds that “this would resource. The stock market and private equity, which be a really positive reform and it wouldn’t cost a cent,” invest in unlisted companies, are alternative sources pointing out that it “would involve a lot of work, but not that already work well in countries such as the United money.” States.

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 13 C o v e r s T O R Y

Companies need to wean themselves off external fi- not in themselves guarantee that the tap will be turned nance and in order to do so they have to grow by using back on. their assets more efficiently. That way they can increase their own resources and won’t need to raise money A More Flexible Labor Market through debt, says Suárez. Another key aspect of the action plan is the labor Vives says economic recovery also depends on in - lmarket. Some European countries have successfully creasing banking regulation. Central banks must main- carried out labor reforms. At the start of the 1990s unem- tain financial stability and any body that carries out ployment in Denmark rose to 10 percent. Employers and banking functions should be regulated and monitored trade unionists worked together on reforms and cut the as such. He warns that a fragmented approach to finan- jobless rate by half by developing the “flexicurity” model cial regulation is “doomed to failure.” which “combines the flexibility that both employers and The banking reforms that have been put in place in employees need with the security that workers require,” the Eurozone are based on reducing the debt and in- says Esperanza Suárez, an IESE researcher. creasing the capitalization of the banks. These mea- Austria and Scandinavian countries have adopted sures are nothing new and began to be applied after the flexicurity measures that have had an impact not just collapse of Bear Sterns in 2008. Although the banking on the labor market but on the welfare state. In fact, regulatory framework under the Basel I, II and III ac - Sweden and Denmark are viewed as models of unemplo- cords is advisory and not compulsory, says Soley, many yment benefit policies. Much of Europe has introduced nations have incorporated the principles into national a model that combines flexibility with social protection. law in order to force their banks to become more sol- In Germany the Hartz reform, which makes indus- vent. However, he adds that, while these reforms are trial relations flexible and allows companies to adjust a prerequisite to increasing the flow of credit, they do working hours and salaries in accordance with demand,

A More Flexible Labor Market

14 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE was passed 90 years ago. Although it was the object of On the other hand, the reforms give the company criticism, it was thanks to this law that 1.5 million wor - greater decision-making powers and gets rid of admin- kers were kept in work at the height of the crisis while istrative protection, especially in the case of redundan - the country gradually recovered (see the article by Prof. cies, says Pin. Furthermore, the possibility of drawing Morten Olsen, page 26). up in-house as opposed to sector-wide agreements Labor reform in Europe’s periphery also seeks to means these agreements can be strategic and can aid make industrial relations more flexible and has two competitiveness. main objectives: increase employment, especially However, one should bear in mind that all of this de- among the young, and improve competitiveness. Ac- mands “greater responsibility and caution on the part cording to Prof. Sandalio Gómez, simplifying the con- of managers and boards,” says Pin. The new rules of the tractual process and increasing flexibility and changes game mean the unions have less power both at company in working conditions will lead to greaterfunctional and and sector level, says Gómez, referring to Spain in par- geographical mobility as well the distribution of work- ticular. “They’ve been put in their place,” he says, adding hours, both of which can increase competitiveness. ing that they have to negotiate and compromise in the Flexibility in production makes companies more context of the company’s reality and not just to save competitive, say Prof. José R. Pin, making it easier to jobs. adjust to market circumstances by altering the work - If reforms are to pay off they should also encourage ing week, salaries and increasing mobility instead of training which is essential for workers to adapt to new through hiring and firing, which has been the approach functions and to prepare themselves for the future, says hitherto. These measures make it easier for a company Pastor. Investing in education and training is “indis- to weather difficult times without losing staff or having pensable” to maintain and develop the economic sys- to close the business, Gómez believes. tem once the crisis ends, he says.

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 15 C o v e r s T O R Y

Healthcare and Pensions

Will reforms help to revive the labor market? The “these reforms are reforms are the musical score, says Pin, and we’ll only know what they are worth once the conductor – in this the musical score and case, the government – gets the orchestra to play. The musicians are business people, executives, workers and we’ll only know what trade unions. The curtain’s gone up and the audience awaits the performance, but there will be no applause they are worth once unless jobs are created. We will have to wait to assess the results, because all the players have to adapt themselves the conductor, to the new reality. in this case the Healthcare and Pensions government, gets the Healthcare is another area in need of reform. Ac- lcording to the World Bank, per capita healthcare orchestra to play” costs rose at the same rate as GDP between 1995 and 2009, which is not tenable in the current climate. Life Prof. José R. Pin expectancy is growing and with it the rate of depen- dency and chronic illness. There are three options, not mutually exclusive, to deal with the problem, claims Prof. Núria Mas. One option is to change the model so as to promo- te efficiency in spending and meeting the needs of the chronically ill. This involves ensuring that it is working well, prioritizing best practices and integrating primary and specialized care. Services can also be priori- tized, ring fencing the services covered by the public system and extending co-payment. Co-payment will contribute towards rationalizing health spending but the authors of the study warn that

16 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE Recommendations for Europe CESifo

Each year the European Economy Assessment Group within CESifo publishes a report on the European economy. The 2012 report focuses on the crisis and its impact on Europe. Written there are sectors of society that could be disadvantaged by economists from seven countries, among if its implementation is not well thought out. These them IESE’s Prof. Xavier Vives, the report would include the poorest patients, those at high risk, recommends the following: the chronically ill and emergencies. For this reason • Introduce guaranteed, standard, Europe-wide they recommend that those on low incomes are pro - letters of credit to give member states access tected and that the model applied to co-payment for to low-interest credit that they can use to meet prescriptions, where everyone pays the same, should their obligations to the European Central Bank. be avoided. They add that this model is more suitable • Encourage European financial integration. to emergencies than primary care and that there should • Give national central banks a be differential co-payment, depending on the service. supervisory role. Quotas should be lower or non-existent for preventive • Reform the European Union’s financial medicine, for example, and higher for less essential or architecture. efficient services. • Stabilize the Eurozone with a credible Demographic changes also demand a rethink in the liquidity instrument for solvent countries that pensions system, a reform that was initiated by the face speculative attacks and with restructuring previous government but needs to be reactivated soon, instruments for insolvent ones. says Argandoña. “We need a fairer, more efficient and • Establish accords for sharing out costs of more contributory system,” Díaz-Giménez says. As the bankrupt banks with a strong European popluation ages, fewer and fewer people are working to authority and with a safe fund of deposits for maintain pension contribution levels, he says. transnational institutions. Aside from the above reforms, more are needed. “We The report also looks at the lesson of Sweden, need to internationalize the economy,” says Vives, who how the crisis is affecting Hungary and says that increasing productivity is key in order to raise proposes economic models to deal with export levels. To achieve this, the reforms must be climate change. implemented in a “serious, consistent and firm” man- ner, he says. More reforms are needed and we have to The report in full: be patient to see them take effect, but IESE professors www.cesifo-group.de believe that Europe as a whole will emerge stronger as a result.

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 17 i d e a s business ethics mapping the path to excellence

domènec melé ar too often we read the consideration of human good as Professor of about cases of cor- the fundamental point of reference Business Ethics, IESE Business School ruption, fraud and for establishing true values. The rea- abuse of power in sons why ethics are fundamental to the financial and good management are: Ethical behavior and business world which few would RESPONSIBLE ACTION social responsibility hesitate to con- The actions of management are go far beyond simply demn on ethical grounds. Many l above all human actions and companies have taken the step of as such involve responsibility. Re- following rules or F incorporating values and codes of sponsibility, or the need account for adopting a code of conduct into their modus operandi. one’s actions, is predicated on the But there’s more to ethics than that. assumption that one has acted free- conduct because in their In its original and, I believe, its ly and consciously and is therefore genuine sense ethics most genuine sense, ethics serve as the master of one’s actions. Thus serve as a guide for a guide for human excellence. This everyone understands that they are point of view, which is intrinsic to responsible for what they have done, human excellence. IESE, is often not fully understood. unless they have been coerced to the Many see ethics simply as some- point that they were no longer acting thing counterposed to corruption of their own free will. or a minimal set of rules that, if fol- Of course, managers come un- lowed, constitute “being ethical.” No der pressure and are afraid of risks one would argue against confronting and uncertainties. This may restrict fraud or deception and operating their freedom, but not to the point within the law. Of course not, but to that they become automatons with- reduce ethics to this is to disregard out any free will. Responsibility that which is of the greatest value, means answering for your actions, which is to aim for human excellence. whether good or bad, because this In a recent book of mine I argue is what ethics entails. that ethics are intrinsic to manage- On the negative side, a manager – ment and essential for good manage- like anyone else – is culpable if they ment. I base this argument on various freely and consciously do something factors which we shall examine in a wrong, or fail to do something they moment. Underlying all of them is should have done. On the positive the conviction that ethics are the ba- side, if they do well, they deserve sis of excellence in human endeavor. praise. Each person’s conscience From this perspective, the moral- bears witness to their moral respon- ity and virtues of individuals that sibility and as a result, we often have lead them to act in accordance with feelings that we are either deserving certain values is central, although a or guilty. Everyone in society also ethics • leadership • human excellence • more complete view of ethics also judges the actions of executives social responsibility • management includes norms and principles and whom they regard as responsible

18 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE and, in some cases, punish them for what are judged to be crimes. Further - more, they often demand accountability.

MORALITY Every manage- l ment decision involves morality. This depends on the degree to which the decisions serve or harm others. In the first place, it affects the decision-maker themselves to the degree to which their own human condition is enhanced or degraded, because just decisions make one more just whereas giving in to corrupt practices corrodes one’s humanity. Words with negative connotations such as fraud, con or bribery all describe reprehensible human ac- no- tions. However, most people don’t tions need any specific terms to describe about actions performed in the service of people, the others. This is clear when we bear company and in mind that in general many people society, the pur- benefit from executive decisions. pose of the com- These decisions are made to create pany and the values jobs, products that people can afford that govern its execu- and to create wealth. But they can tive actions. A manage- also be unjust decisions if they don’t ment ethos that sees the respect people’s rights or are not in business as a community the common interest. This is what of people in which employ- morality means. In practice, there is ees, consumers and other no such thing as morally neutral ac- people related to the company tions, even though they may appear are valued, treated with dignity so if they only involve introducing a and have their rights respected technique or doing the accounts, be- has an ethical dimension very cause they embody intention, that is different from a company which to say, they have a purpose, whether sees itself as a purely economic good or bad, and this lends them instrument in which people are their moral character. valued merely for their productivity or as sources of profit. One way MANAGEMENT ETHOS or another, all business theories and An ethos with ethical implica- practices embody ethics. A failure l tions underlies every manage- to realize this can lead to actions ment practice. Company manage- based on false premises and pseudo ment, like other practices, is based values. on a set of ideas and values that together make up what could be BUSINESS CULTURE called the management ethos. This Ethics are an important part of includes, among other elements, l business cultures. Many people

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have come to see that organiza- aside, perhaps, from an enthusiasm executive tional and business culture is more for using these tools. But a manager important than strategy when it is a human being and the virtues and behavior is an comes to achieving desired results. values inherent in their moral char- Just as with management ethos, ex- acter inform the way they work. A expression of ecutive behavior is an expression person with a truly virtuous moral the shared of the organization’s shared values character will adopt a responsible and convictions and the virtues attitude to their mission and will values and that comprise its business practice. carry out their work well, making Leadership is a key factor in devel - fair and wise decisions while honor- convictions oping business cultures. ing their commitments. Encouraging ethical values and Their sense of responsibility will that comprise practices and, above all, leading by lead them to seek ways of working example, can have a huge impact on more efficiently and being more the business a company’s human and ethical cul- creative. They will refuse to do dirty ture. It’s easy to see that a culture in work that is not only degrading but practice which a spirit of service, passion for is risky both for themselves and the work and honesty are valued will pro- company. When faced with situa- duce very different results from a dis- tions where it is difficult to do the honorable organization that disdains right thing, they will use their moral service and produces poor work. imagination to find solutions that are both ethical and efficient. TRUST AND REPUTATION LEADERSHIP Consistently ethical behavior Moral capacity rooted in virtue l creates trust and a good repu- l encourages leadership. A good tation. It is widely recognized that manager has to be a leader and here, trust plays a vital role in initiating too, their moral character is of great and doing business as well as for ce- importance. Understanding lead- menting a good reputation, which is ership to mean influencing others essential for people and institutions. and persuading them to follow you It is well known that trust reduces in order to achieve common objec- operating costs. Where there is no tives calls for specific abilities, some trust, expensive control mechanisms of them of an ethical nature. Moral have to be introduced as a guarantee. capacity rooted in virtue creates Something similar happens in regard credibility and encourages others to reputation and corporate reputa- to follow and to collaborate. tion in particular. Being sincere, honorable, fair, A good reputation attracts good kind, humble, genuine, generous staff and clients. A false image may and courageous are aspects of these serve to create trust and a good abilities. Studies of leadership high- reputation for a while but if it is not light one moral feature in particular: based on ethical behavior, sooner or integrity. In its most genuine sense, later the trust will run out and the integrity is the moral quality that reputation will evaporate. When combines all the virtues. this happens it’s very expensive re- The above reasons make it clear cover the trust and reputation that why the ethical dimension of man- have been lost. agement must be borne in mind in decision making, formulating and MORAL CHARACTER implementing strategy, devising The moral character of execu- systems or any other aspect of busi- l tives informs their performance. ness activity. Not to do so amounts to If management consisted of nothing closing one’s eyes to reality which can more information: 1 D. Melé, Management Ethics: more than the mechanical applica- have serious consequences in terms Placing Ethics at the Core of Good Management tion of techniques, norms and proof the human damage caused, the ef- Palgrave MacMillan, New York, 2012. cesses, then personality would have fect on the running of the organiza- www.blog.iese.edu/eticaempresarial little bearing on good management tion and, not far off, on the results.

20 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE

i d e a s banking reform towards a new banking model

Jorge Soley eptember 2008 are international agreements issued Extraordinary Professor marked a watershed by the supervising committee of the of Financial Management, IESE Business School in international af- Bank for International Settlements fairs. The bankruptcy based in the Swiss city of Basel. Many of Bear Sterns and of these regulations were introduced Political pressure and a Lehman Brothers before the crisis hit. However, until triggered a recession Basel I was introduced in 1988 no loss of public trust have that continues to this minimum levels had been set for the increased the clamor day and that exposed the fact that minimum amount of capital a bank Smany banks did not have sufficient should keep in reserve, but the start for banks to be better capital to cover the potential losses of the recession accelerated the in- regulated but there are no on the risks they had assumed, with troduction of prudential regulations. the result that a lack of liquidity The first problem was agreeing on quick-fix solutions to what translated into a sovereign banking a definition of capital banking cover- is a complex problem. problem. Faced with this situation, ing all the affected countries at a time governments began to take measures when there was neither European to clean up banking. These measures nor worldwide regulation and super- ranged from nationalization in the vision. The Basel accords are recom- United Kingdom and an EU rescue mendations but many countries have plan for Ireland, financial aid in the incorporated them into law. United States, in particular in the The new Basel accord, known as case of the semi-public mortgage Basel III, was published in Decem- providers Fannie Mae and Freddie ber 2010. This represents a point of Mac, and state cash injections to no return towards a new financial German savings banks such as Com- architecture and demands signifi- merzbank and Hypo Real Estate, cantly more stringent which was also the case with Dexia in standards France and ING in the Netherlands. Various factors have led us to this point. Some banks were exposed to so-called sub-prime mortgages, others are affected by the burst property bubble and others by their exposure to public debts, such as the French and German banks that bought a lot of Greece’s public debt.

Regulating the Banks The framework governing the lnorms that banks must adhere banking • debt • regulation • to regarding their own resources is basel accords • spanish banks known as the Basel Accords. These

22 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 23 i d e a s

than Basel I and Basel II. However, regulated. This system possesses a banks will it will take several months to imple- greater volume of assets than the ment as it is a protracted process world banking system, is promoted attempt to that requires a European Directive by bank shareholders and centered, and the drawing up of correspond- surprisingly, in London. pass increases ing regulations. The increase in banks’ solven- on to clients Anglo-Saxon countries have taken cy, that is, of their own resources, this a step further with the imple- will presumably lead to a rise in the or to reduce mentation of “ring fencing.” This cost of credit and banking services draws a line between the activities as one’s own resources are usually their assets of the commercial bank (based on more expensive than those from the general public’s deposits) and third parties. Banks will attempt in order the investment arm, and demands to pass this increase on to clients distinct requirements regarding sol- or to reduce their assets (by offer- to lower vency and operations for each model. ing less credit, which is what’s hap- Meanwhile, in 2011 and 2012 the pening now) in order to lower their their capital Spanish government introduced capital necessities. minimum levels of “principal capi- Reduction of the balances and low- necessities tal,” which is very similar to Com- er profitability of the credit entities. mon Equity Tier I, known in the banking world as “core capital” ie: bank restructuring capital + reserves + results. A combinaton of the above Once it comes into force Basel III l points, along with govern- will also establish a number of ratios ment support and various types of of minimum liquidity and leverage bailouts totaling €1.2 billoin ($1.7 of total active assets independent billion), not counting the bailout of their risk profile in order to pre- of Spanish banking in June 2012, vent excessive leveraging. From all has led to the consolidation and of the above we can draw the follow- restructuring of banks. The time ing conclusions: factor has been key in the imple- The implementation of pruden- mentation of all of these processes, tial regulations is slow and not always although this has often not been ap- global. The period of adaptation for preciated by government. Restruc- Basel III runs from 2013 to 2019. This turing will have characteristics that regulatory framework demands that were unimaginable before the start banks have significantly higher capi- of the financial crisis, including: tal resources. Fitch estimates that Fewer national, European and the 29 largest banks need to raise international players. They $556 billion by 2018 or reduce their will be measured by their sol- outgoings by $5.5 trillion, neither of vency but the volume of their which is easy to achieve. balances will be discriminatory. The supervision landscape that The existence of a nationalised ultimately emerges may change sig- bank, the majority in nificantly, above all under pressure some cases, initially from banking associations. of a temporary The development of the cor - nature. porate governance of banks (Basel A change in III – Pilar II), which has emerged the nature of as particularly important recently, shareholder is being left for later. First the sol- profile, with vency issue has to be resolved and local individu- once that has been achieved we can als and institu- move on to the business of gover - tions playing a nance and transparency. smaller part and The so-called “shadow banking substituted in system,” consisting mainly of hedge part by “shadow funds and private equity, remains un- banking.” Less

24 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE internationalization through mi- don’t lead to an immediate loosen- nority shareholdings which are ing of ties on credit; it takes time, we have penalized regarding the capital especially as this coincides with the requirements. And let’s not for - implementation of Basel III. to look get two points that are strategic From all of this we can deduce but have structural implications: that we have to look for credit else- for credit Improvements in corporate gover- where (by, for example, cutting elsewhere and nance. The “back to basics” bank- back on dividends, seeking indi- ing which is being touted by vari - vidual or institutional investment not depend on ous experts but about which I have partners, private equity, looking to doubts because of the insufficient the Alternative Stock Exchanges banks as much added value. and at business angels) and not depend on banks as much as as we do now Are Mergers the Solution? we do now. They might be in some circum- Although the l stances but the problem banks economy can’t be rapidly swallowed up. Be- and the sides, these are difficult times for bank- anyone running a bank. There is ing sec- insufficient interest spread, there tor will are limits to how much efficiency improve, can be improved, there are regula- company tory limits on the assets that can financ- be invested and their industrial ing won’t participations are not doing well return to on the stock market. Add to this the the status pressure, much of it political, that quo that derives from the public perception existed be- that banks have been badly man - fore 2007. aged and it is clear that the single There’s a factor on which banks depend before and most– trust – is under attack. after for the banks, but Reform is not the Same also in business fi- as Giving More Credit nance policy. It’s a necessary but not a suffi- l cient condition and this is true for all of Europe and the United States where, in spite of the re - forms and underpinning of the banks, there is insufficient credit. The measures taken

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 25 i d e a s labor market reform protecting the few at the expense of the many

MORTEN OLSEN n 2011 Spain was struggling bor) and changes in exchange rates. Assistant Professor with an unemployment rate If, say, Spanish productivity improve- of Economics, IESE Business School of 22 percent, a barely positive ments are insufficient to keep up with growth rate and a government German productivity improvements budget deficit of 8.5 percent compared with increases in costs of la- The pre-crisis boom in of GDP. The unemployment bor, then the exchange rate must adjust rates in Greece and Portugal to ensure Spanish competitiveness. Southern Europe obscured were 18 and 13 per cent, res- This is exactly what was happening the fact that inflexible pectively. All of this, while Germany throughout the 1990s when the Spa- wasI enjoying an unemployment rate nish peseta depreciated by 30 percent labor markets have kept below 6 percent, visible growth and a compared with the German D-mark. the unemployment rate government budget deficit of 1 percent After the introduction of the euro this unacceptably high for of GDP. So far 2012 has not shown any “release valve” no longer exists. signs of improvement. Investors are The consequences are shown in the decades. France and increasingly cautious about Southern graph overleaf which plots German Italy generally have had European government debt while productivity and average compen- jumping at the opportunity to place sation. Compensation per employee unemployment rates around their money with the Germans even at grew by 8 per cent between 2000 and 10 per cent and Spain’s has historically low interest rates. What are 2008 and productivity a bit more. dipped below 10 per cent the Germans doing right? And what – Compare this to Spain and Italy were if anything – can Southern Europeans productivity was almost constant, during only three of the past learn from the Germans and the rest of but wages grew by 30 and 20 per cent, 30 years. Northern Europe. respectively. This resulted in a dete- As with most things these days, the rioration of competitiveness with the answer lies with the introduction of predictable consequence of a worse- the euro, and in particular two implica- ning of the current account deficit. The tions of its original design: the removal picture has improved somewhat since of exchange rate flexibility by the intro- 2008 in Spain, but primarily due to the duction of a common currency and the deep Spanish recession which typica- implied understanding that all eurozo- lly leads to cost-cutting and moderate ne government debt was created equal. wage demands. First, the common currency. The ability of companies to compete inter- INTEREST RATES nationally is affected by three factors: The second important implica- changes in productivity (the ability to l tion of the euro was the harmo- eurozone • labor market reform produce more goods – or goods with nization of interest rates required • unemployment • sovereign debt • higher quality – using the same inputs), on government debt. Shortly after flexicurity • entrepreneurship changes in input costs (primarily la- the introduction of the euro yields

26 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE on governments bonds across the eurozone were low and within a few points of each other. It is clear that, although bail-outs are specifically ru- led out by the Maastricht treaty, markets perceived all government debt as equally risky. Though this had different effects across the eurozone, cheap credit does tend to encourage profligate spending. In Spain it fue- led a boom in the construction sector partly aided by lavish government spending on airports, prisons and the like. At its peak the share of Spanish employment in construction was 13 percent (2006-2008) compared with a relatively steady level of 8 percent in the eurozone as a whole (OECD statistics). Since then employment in construction has shrunk by more than 1.3 million people. Most of these people will have to find jobs in other sectors, a task made more difficult by the fact that many of them dropped out of school to pursue the then lu- crative jobs in construction. This leaves the Southern Euro- pean countries with severe competitiveness challenges, and Spain with the twin challenges of improving its overall competitiveness and reallo- cating a large share of its work force from construction to the sectors of the economy that are able to compete internationally, such as apparel (think Zara and Desigual), agricultu- re, tourism and certain parts of manufacturing. Both challenges lead us down the same road: labor market reform. As there are as many labor market systems as there are countries in Euro- pe, what better direction to look than at our neighbors, some of which have structured their labor markets very differently. This examination demonstrates that the debate on labor market reform is plagued by a number of myths.

MYTH 1 Making it easier to fire peo- lple will only increase unemployment. Though conceptually, lower firing costs (severance pay, cumbersome legal procedures, and the burdensome dual labor market

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system of particularly Spain) can reforms will continue to be so even MOVING MANY either directly increase unemploy- when the current recession ebbs. ment or reduce it as companies will The OECD estimates that the rate of WORKERS FROM find hiring new employees less risky, unemployment in normal economic all experience and research shows circumstances is around 16 percent in CONSTRUCTION that the effect of encouraging em- Spain and 11 percent in Portugal, whi- ployment is stronger. Think of the le only 7 and 4 percent in Germany TO OTHER Southern European countries that and the Netherlands, respectively. INDUSTRIES typically have more rigid systems and higher unemployment and the MYTH 3 REQUIRES Northern European and American Higher flexibility would equal systems with more flexibility and l“American”-style lack of protec- FLEXIBILITY lower unemployment. On top of tion for the workers. This argument this, Spain currently has to move is turned on its head. In fact, instead of a large share of its workforce from providing protection the current sys- construction to other industries, a tem only harms the millions of peo- task that above all requires flexibility ple who are currently unemployed by to encourage hiring. preventing them from participating Further, this is purely looking at the in the workforce. Further, as shown effects on unemployment and disre- by the Scandinavian systems, in par- garding the economic efficiency from ticular the Danish flexicurity system, allocating people more productively flexibility in the labor market can be and reducing the number of “cus- combined with security for workers. hion” jobs of no real economic value. Firms are (almost) free to adjust their The higher is overall production, the work force as they see fit, but the go- higher can wages be without leading vernment provides both high initial Source: OECD Statistics to deterioration of competitiveness. unemployment benefits as well as a very active engagement in finding MYTH 2 new employment for those who lose The high unem- their job. Germany has adopted many Labor productivity lployment rate of the same measures, complemented per employee is only a feature of by a system with flexible adjustment Index: 2000=100. the current reces- of working hours and the possibility 140 sion, and will fall of part-time jobs. In Southern Europe, 130 when the econo- regulations, for instance the design of 120 mies recover. social security contribution in Spain, 110 High unemploy- often make part-time unemployment 100 ment rates have been unattractive. And this at a time when 90 a persistent feature part-time employment could allow

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 of the French, Greek, thousands of people to retain some Germany Greece Italy Spain Italian, and particu- connection with the labor market. lar the Spanish eco- Naturally, implementing these nomy for decades. things would require a substantial Labor compensation The most striking change to the current system of pas- per employee thing about the Spa- sive unemployment support to one Index: 2000=100. nish unemployment of more active encouragement. A 160 rate is that it has dip- good start would be to discourage 140 ped below 10 percent students, citizens living abroad, and 130 for only three of the workers in the unofficial sector from 120 past 30 years. It was collecting unemployment benefits. 110 as high as it is now in 100 the mid-1990s! High MYTH 4 90 unemployment has The Mediterranean culture and been a consistent lregulation stymies entrepre- 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 feature of Spanish neurship and how are we suppo- Germany Greece Italy Spain labor markets for sed to compete with the Chinese? decades and without This myth is unfortunately partly

28 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE true. The World Bank ranks Spain, is below the current level of unem- Italy and Greece as 44th, 87th, and ployment benefits, this can be fixed WE SHOULD 100th, respectively, in ease of doing through the tax system: It is certainly business (doingbusiness.org), whe- better for everybody if instead of pa- LOOK AROUND reas Germany gets a rank of 19. This ying, say, €400 in unemployment be- fact, combined with a generally high nefits, the government paid €200 in WITH AN OPEN level of red tape and government an earned income tax credit on top of MIND FOR bureaucracy probably go much fur- €300 earned in employment. ther in explaining the perception of WHAT WORKS a lack of “entrepreneurial spirit” than MYTH 7 anything inherent in the Mediterra- The Germans want everybody ELSEWHERE nean culture, a fact demonstrated by lto become like them. It is true the (export) successes of a number that the German mindset has been AND ADOPT of Spanish sectors such as industrial and continues to be important for technology, chemicals, fashion and the way the eurozone deals with the BEST PRACTICES various agricultural products and crisis. Germany is both the largest the highly competitive Italian pro- economy and the Bundesbank pro- HERE AT HOME duction of fashion and luxury items. vided the blueprints for the original It is not necessary (nor desirable) to design of the ECB. This means that compete with neither China nor Ger- measures which would provide im- many in all sectors, but it is neces- mediate relief to Southern Europe sary to take advantage of the sectors such as a common guarantee on all where countries are internationally government bonds (by lowering competitive. Governments should yields on government bonds) or in- do all they can to encourage this by creased German inflation (which supporting new businesses and flexi- would make it easier for to regain ble labor markets. competitiveness for Southern Euro- peans) are facing German resistance. MYTH 5 However, it is important to realize Unemployment actually is not that there is nothing inherent in a cu- lthat high as a lot of people work rrency union that requires countries in the unofficial sector. One would to have the same average living stan- certainly hope so. That would be less dards, just as there is nothing within of a waste than large fractions of the a country that guarantees that every- work forces being unemployed. But body has the same income. What not much less: as a result of being the argument above demonstrates outside the legal framework of con- is that what matters to avoid future tract enforcement, proper regulation crisis is that the ratio of productivity and property rights, the unofficial to wage compensation must be fairly sector operates less efficiently and equal across countries. If there is so- creates less wealth than official em- mething inherent in the Mediterra- ployment. In addition the claim finds nean way of life which implies lower little support as the unofficial sector productivity – which seems doubt- is estimated to be almost of the same ful – there is no inherent problem, as size in Denmark (18 percent of GDP) long as both people and government and Germany (16) as in Spain (22.5).1 live within their means. So where does this leave Southern MYTH 6 Europe? With high unemployment, a If wages were lower, people constant threat of spiraling rates on lwould be poorer and Southern government debts and the challen- Europe would be poorer. The cu- ge of a deep recession, governments rrent situation represents a large need to do all they can to fully employ waste of labor throughout the peri- their work forces as quickly as possi- phery, and employing a larger share ble. What better way to do that than more information: of the labor force would make coun- to look around with an open mind, 1 Schneider, Friedrich, Size and Measurement of the Infor- mal Economy in 11 Countries Around the World, 2002. tries as a whole richer. If the wage see what works in other countries, and www.blog.iese.edu/economics needed to profitably hire a person adopt the best practices here at home.

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 29 i d e a s Highlights Europe’s Housecooling SEBASTIÁN CURET AND JOSÉ LUIS MORAGA Drawing on the European Energy Performance of Buildings Directive, the authors analyze plans to implement the new regulations across European countries. In their report, “Climate Change Regulation: Energy Efficiency in Buildings in Europe,” Sebastián Curet and José L. Moraga of IESE’s Public-Private Research Center study the impact of EU policies on the residential buildings market. Residential buildings are one of the main sources of greenhouse gas emissions and focusing on this market presents key opportunities. Europe leads the world in policies mitigating climate change emissions but to meet 2020 targets, EU countries will need to redouble their efforts.

MORE INFORMATION: IESE Insight/Economics Report: Climate Change Regulation: Energy Efficiency in Buildings in Europe

SWINGING THE LEAD BLANCA SÁNCHEZ-ROBLES, JORGE GUADA, FEDERICO DURÁN, EVA DIEZ-ORDÁS, EVA M. BLÁZQUEZ, ELISA PENDÁS AND ÁNGELA M. GALLIFA

The cost of absenteeism takes on greater significance in times of crisis when companies need to weed out inefficiencies in order to be more productive. However, it is not easy to pinpoint which absences are unjustified. Of the seven countries covered by the study, Spain has the highest rate, with 11.6 days lost per worker each year and a direct cost of €343 per salaried employee, followed by Switzerland (10.9), Finland (8.9), Denmark (7), Australia (6.8) and Canada (6.6). The United States (4.9) has the lowest rate. The report suggests regulatory, management and financial measures to minimize the problem. For example, it would help both employers and tribunals if there were clear guidelines regarding the circumstances in which absenteeism is cause for dismissal.

MORE INFORMATION:: IESE Insight/Leadership and People Management

30 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE Dos and Don’ts of Technology is Working in Brazil Key to Future josé r. pin, pilar garcía lombardía and ángela gallifa of Healthcare

The report examines the key Núria Mas AND Giovanni Valentini factors when designing a Technology has become a key strategy for operating in Brazil, element of competition in the and presents different case studies: hospital market. At the same time, 6 years in Brazil this market in the US has experienced “It’s vital to have empathy and an enormous merger activity. In their accept the differences and learn study “The importance of Technology to adapt your skills to get the best in the Consolidation of Hospital performance. Bringing both styles Markets” the authors analyze the together efficiently creates the role that technology can play in this greatest value.” consolidation wave by focusing on how it can affect a hospital’s selection 5 years of a particular target. They find that in Brazil hospitals are more likely to choose “As an targets that complement their expatriate technological holding, specifically you have to when these are complex technologies understand how people are, and with favorable cost / benefits how they ratios. With this, the merged entity discuss issues and know tends to become closer to a one- how they go about things.” stop-shop hospital.

MORE INFORMATION: IESEInsight/ Economics MORE INFORMATION: IESEInsight/Economics Report: Destino:Brasil

The human face of business The latest edition of Insight invites you to rethink the company SUBSCRIBE NOW! The credibility of companies as There are also articles about how to Don’t forget that as a member l institutions has hit an all-time launch and IPO, the opportunities of the Alumni Association you can low. Can we reverse this trend? Tread- presented by an ageing population, access all the content of IESE Insight ing a more humane path seems to be Kola Real’s attempt to overshadow magazine using your usual log-in and password. And if you are not, the only way to ensure that business the giants of the global cola you can subscribe at is economically, socially and humanly industry and an interview with the www.ieseinsight.com/ sustainable. There are ideas about European head of Toys “R” Us. susbcription how to achieve this in the report in MORE INFORMATION: the latest edition of IESE Insight. www.ieseinsight.com

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 31 c r o s os r oi a d s Growing Pains IAB Looks at Prospects for the Global Economy

embers of IESE’s International Advi- “The markets are schizophrenic,” he said. “They ask for fis- sory Board spoke at a Continuous Edu- cal consolidation but don’t like it when this slows growth.” cation session on April 20 in Barcelona He was followed by Patricia Francis of the International under the title “Corporate Growth: Trade Center who commented that most of the growth is New Business Opportunities in the coming from BRICs. Demand in the BRICs is growing by 7 Global Economy.” After a welcom- percent but is much slower in OECD countries. China mov- ingM address by Dean Jordi Canals, Prof. Núria Mas, who ing to higher form of production and not importing inter- moderated the first panel, reviewed world economic growth mediary goods. Brazil exporting more raw materials than before introducing the first panel which addressed the ques- finished goods. “The challenge we face is to see that growth tion of the “World Economic Outlook.” actually creates jobs and alleviates poverty,” she said. The first speaker wasMichel Camdessus of the Banque Janne Haaland-Matlary from the University of de France and formerly of the IMF who said that prospects Oslo talked about the widespread corruption in Eu- are gradually improving but that downside risk is very high. rope that had eroded people’s faith in democracy, espe-

32 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE Andrea Christenson and Stanley Motta

Isak Andic and Hans-Jacob Bonnier

Michael Camdessus, Patricia Francis, Janne Haaland-Matlary, Denise Kingsmill, Hans Ulrich Maerki and Prof. Núria Mas

Johan Schrøder

cially in Greece and Italy. “It is irrational for a citizen to pay taxes in a country as corrupt as Greece,” she said. “The crisis has exposed the unsustainability of cor - rupt government. There has to be basic social justice in the challenge we face the system.” is to see that growth This view was reinforced by Denise Kingsmill, IAG Group, who expressed concern over the discon- creates jobs and nect between business, politics and the citizenry. The knee-jerk response of business to economic setbacks alleviates poverty” is to begin sacking people, she said, adding that in a crisis “business is more pragmatic and global in its outlook while government becomes more nationalistic Patricia Francis and protectionist.”

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 33 c r o s os r oi a d s

Isak Andic, Prof. Jordi Canals and Prof. Josep Valor Patricia Francis and Brian Duperreault

Kees J. Storm, Mariano Puig and Francesco Vanni D’Archirafi Prof. Weber, Mª del Mar Raventós and Denise Kingsmill

Michel Camdessus and Stanley Motta Hans Ulrich Maerki, Isak Andic and Mª del Mar Raventós

ABB board member Han Ulrich Maerki’s advice was just technical it’s a change in consumer behavior. Mass media “don’t believe everything your chief economist says be- can be consumed wherever and whenever you like.” He was cause in three months he’ll say something different.” In followed by Andrea Christenson of Kathe Kruse Puppen global business, strategy has to be reviewed at least every who said “consumers are now on a sort of treasure hunt and six months, he said, not every few years. you have to be sure they find you.” The second panel, chaired by Prof. Julia Prats, took as its Stanley Motta of Motta International asked why in the de- theme “Globalization and new business opportunities. The veloped world savings are taxed if we expect people to provide next 10 years.” Isak Andic, founder and CEO of Mango, said for themselves rather than rely on the state? The last speaker the company is opening 400-500 shops a year and this year is was Johan Schrøder of the Schrøder Foundation who said growing by over 30%. “It all depends on how much you want that “we in Europe have to learn from the developing world,” to work and having the right people around you,” he said. “Be- adding that “as Europeans we have a real problem figuring yond that, the sky’s the limit.” Hans Jacob Bonnier of Bon- out what to do. How will we address the social unrest we are nier AB commented that “the paradigm shift in media isn’t going to see?”

34 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE 1. Stanley Motta 7. Janne Haaland- 12. Denise Kingsmill 2. Mariano Puig Matlary 13. Prof. Jordi Canals 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 3. Kees J. Storm 8. Isak Andic 14. Andrea Christenson 4. Francesco Vanni 9. Hans-Jacob 15. Prof. Eric Weber D’Archirafi Bonnier 16. Mª del Mar 5. Patricia Francis 10. Hans Ulrich Maerki Raventós 6. Brian Duperreault 11. Johan Schrøder 17. Michel Camdessus

IESE’s Top Advisors Meet in Barcelona

IESE’s International Advisory Board (IAB) held its annual IAB comprises 34 company presidents and CEOs as well meeting on April 20 on the Barcelona campus. The meet- as world-renowned economists from Europe, Asia and the ing began by welcoming two new members, Brian Dup- Americas. The members are in constant contact and once erreault, Chairman and CEO of Marsch & McLennan, and a year they meet to discuss the challenges facing execu- Francesco Vanni D’Archirafi, CEO of Citigroup GTS. The tive education and to advise IESE on current trends.

MEMBERS OF THE INTERNATIONAL ADVISORY BORD (IAB)

Andic, Isak Gyohten, Toyoo Mohn, Liz Schrøder, Johan Mango, Spain Institute for Bertelsmann, Schrøder Foundation, International Monetary Germany Dinamarca Bagel-Trah, Simone Affairs, Japan Henkel, Germany Motta, Stanley Shibata, Takumi Haaland-Matlary, Janne Motta Internacional, Nomura, Bonnier, Hans-Jacob University of Oslo, Panama Japan Bonnier AB, Sweden Norway Murthy, N. R. Narayana Sorrell, Martin Camdessus, Michel Haniel, Franz Infosys Technologies, WPP Group, Banque de France, France Metro, Germany India United Kingdom

Christenson, Andrea Heiberg, J. Gerhard Pino, Rafael del Storm, Kees J. Kathe Kruse Puppen, Norscan Partners, Ferrovial, Spain Aegon, The Netherlands Germany Norway Puig, Mariano Vanni D’Archirafi, Duperreault, Brian Johnson, Franklin P. Fundación Puig, Spain Francesco Marsh & McLennan, Asset Management CITI, United States Germany Company, Raventós, M.ª del Mar United States Codorníu, Spain Wenning, Werner Fanjul, Óscar Bayer, Germany Omega Capital, Spain Kingsmill, Denise Revoredo, Helena IAG, United Kingdom Prosegur, Spain Yeo, George Francis, Patricia Kerry Group, International Trade Center, Maerki, Hans Ulrich Riboud, Franck Hong Kong Switzerland ABB, Switzerland Groupe Danone, France Zegna, Ermenegildo Fung, Victor K. Mangold, Klaus Russwurm, Siegfried Ermenegildo Zegna, Li & Fung Group, China Daimler, Germany Siemens, Germany Italy

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 35 c r o s os r oi a d s

MBA Programs: Taking on THE FUTURE International conference gathers deans, professors and recruiters together to discuss the way forward for executive education.

o remain relevant in the future , MBA pro- Roche; Sandy Khan, MBA Arena and Microsoft; Martin grams around the world must rebalance Danoesastro, BCG; Tim McNicholas, Siemens; and Du- “knowing with doing,” while instilling a arte Braga, McKinsey. Providing insights from their ex- long-term view of the company, stressed periences in the business school world were Dean Peter participants in the recent conference Tufano, Saïd Business School, University of Oxford; Dean “Rethinking the MBA: Business Educa- Bernard Ramanatsoa, HEC School of Management; Dean Ttion at a Crossroads.” Jordi Canals, IESE; Associate Dean, Soumitra Dutta, IN- Directed by Harvard professor Srikant Datar, the con- SEAD; and Associate Dean, Martha Maznevki, IMD. ference was held April 26-27 on IESE Business School’s Datar’s book, Rethinking the MBA: Education at the Cross- Barcelona campus. roads, (Harvard Business School Publishing, 2010) has be- The conference drew business school deans, academics, come an important reference for improving the impact of corporate recruiters and HR managers from all over the world MBA programs worldwide. to debate challenges they face in developing future leaders. On the first day of the conference,Datar said that busi- A wide range of topics were covered, eliciting both corpo- ness schools had not done enough to respond to the finan- rate and academic perspectives. Business school deans and cial crisis and more changes are needed in curricula and academics taking part in the conference came from INSEAD, teaching approaches. In 2008, he said, he began to inves- IMD, Oxford, Cornell, LBS, HEC Paris, Rotterdam School of tigate how to address problems faced by business schools Management, Lagos Business School, IPADE and ESADE. such as drops in enrollment, increasing criticism about a Corporate recruiters and representatives provid- lack of research relevance and the need to better balance ing presentations on key topics were Michael Griffits, the “knowing” and “doing.”

36 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE THE overall goal of business schools should be to create a business and teaching environment that is conducive to creative thinking”

egy. She also noted that many students do not know how to sell themselves. IESE Prof. Pankaj Ghemawat noted in a separate session that perceptions about the extent of globalization and disappearance of national frontiers are greatly exaggerated. If companies were truly globally integrated, there’d be no need for globally distinctive thinking and approaches. Yet that is not the case, he said. Moreover, while business leaders may think globalization is good, not everyone else does and MBA students need to understand that.

10 “Hot” Topics During the event, the following 10 topics and imperati- lves for change were specifically addressed: Prof. Srikant Datar 1. Recent enrollment trends and growing competition. The MBA sector is experiencing declining enrollment in full-time MBA programs, with the U.S. undergoing a 20 percent drop recently. Yet demand from China and India is on “Business school students might know a lot, but can the rise. At the same time, new business education formats they actually do it?” said Datar. “Can they actually work are emerging, including new types of part-time programs. in organizations and understand what the issues are? Can 2. Relevant research. Specific business sectors and the they act in ways that are innovative? Can they give critical general public have expressed concern about the limitations feedback? These are doing skills.” of academic research and the palpable need for broader re- Discussions, which included representatives from lead- search approaches. Business schools often do not take inter- ing companies, focused on four central themes: globaliza- disciplinary approaches. tion, leadership development, innovative thinking and 3. Student engagement. Experiences from different action learning. IESE professors coordinating or leading schools show that MBAs are increasingly distracted by sessions during the conference were Paddy Miller, Ale- activities outside the classroom. They also experience jandro Lago, Pankaj Ghemawat, Mireia Las Heras, Car- greater self-imposed pressure today to find an ideal job los Garcia Pont and Sandra Sieber. following graduation. With this strong focus on what In a session on how schools can be more effective in de- they will do following graduation, they sometimes have veloping managerial talent, Martin Danoesastro of BCG less commitment to what happens within the classroom said his company looks for insight, impact and trust, when walls than in the past. recruiting. Empathy and listening skills are also important. 4. Professional focus. In recent years, some MBA pro- Sandy Khan of MBA Arena and Microsoft said that there grams around the world have placed more emphasis on is often a mismatch in student expectations and corporate banking and consulting as a career path following gradua- hiring processes. Business schools need to help students tion. In doing so, these programs have lost their appeal to decide what they want and then develop a personal strat- potential students who are interested in pursuing other

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 37 c r o s os r oi a d s areas of business. These students may find the MBA ir- relevant to their futures. 5. Practical experience. When faced with a real working environment for the first time, graduates can experience a knowledge gap in understanding organizational realities. Outstanding MBA programs are good at teaching both what students need to know and how to apply that knowledge. 6. Impact of business on people and society at large. MBA graduates, who will become the leaders of tomorrow, need to have a firm grasp of the responsibilities leaders have and the impact of their decisions will have on other people and society. 7. Inter-cultural MBA curricula. Some MBA graduates are often unaware that there is still a need for inter-cultural approaches. Schools must recognize the social and cultural differences that impact doing business in different geographic regions. Brian Mc Grath and Prof. Paddy Miller 8. Leadership skills. Recruiters value leadership talent as a key skill for new hires, so MBA programs should emphasize this area in order to prepare effective managers. 9. Creative thinking. Innovative thinking and creative problem-solving are becoming increasingly valued by firms today. MBA programs should find new ways to introduce these areas into curricula. 10. Meeting the needs of companies. According to many recruiters, there is often a mismatch in student expectations and corporate hiring processes. Students should begin their careers with a solid grasp of the realities of working in today’s organizations.

Looking to the Future During the event, various recommendations were put lforward by participants to help safeguard the MBA program’s prestige and future. Panelists expressed the need to open business schools up to the world through innovative thinking. They should do this by encouraging cross-discipline research and Duarte Braga, Prof. Martha Maznevki and Prof. Sandra Sieber teaching. While it is not difficult to find professors who are creative within their own disciplines, it is more challenging to get them to depart from their own “silos” to form cross- disciplinary teams. In this way, when students and companies meet, they will be Business schools can also follow examples of other educa- able to understand each other’s goals and more effectively tional settings, such as environments where young children determine if there is a good match. In this sense, companies are taught through innovative approaches and processes. and business schools would benefit from closer and greater Many companies and business leaders take a short- cooperation to create effective action learning initiatives. term view of the future, due to the pressures of generating Business responsibility and ethics are another area that quarterly profits and meeting shareholder expectations. needs to be focused upon, participants said. Schools need To counter this, schools should focus on merging creative to pay greater attention to personal development and help and innovative thinking with a long-perspective of the firm students think about leaders’ roles and the responsibilities and come up with ideas that will still be applicable five, 10 of business in society, for example: or 20 years down the line. Developing alternative approaches to inspiring, influ- Business schools also need to place a clear priority on pre- encing, and guiding others. paring graduates with the skills and abilities that companies Building awareness of personal strengths, weak - are looking for. This means communicating companies’ real nesses and values. needs effectively within formalized frameworks. Students Understanding people from different backgrounds should be encouraged to think about their career aspirations, and recognizing the impact of one’s actions and behav- and then develop a personal strategy for accomplishing these. iors on others.

38 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE Peter Tufano, Bernard Rmanantsoa and Prof. Carlos García Pont Martin Danoesastro,Michael Griffits and Sandy Khan

Prof. Soumitra Dutta, Tim McNicholas and Prof. Mireia Las Heras Prof. Pankaj Ghemawat

Business schools need to rebalance the “knowing and do- Creative thinking and particularly the ability to manage ing.” This implies moving away from the lecturer teaching creative individuals are becoming increasingly important approach and embrace the case study approach and focus- in the business context. The overall goal should be to cre- ing on problem solving exercises, panelists said. Summer ate a business environment that is conducive to creative internships are a great place to put learned skills into action thinking. Following this, action learning – which can help and, when back in class, analyze them with professors. student learn to solve moral dilemmas and deal with cross- A global perspective remains critical for MBA gradu- cultural issues – is also becoming a more useful approach. ates, the panelists agreed. Professors need to help stu- Finally, MBA programs must embrace social media in dents acknowledge cultural and geographical differ - today’s changing world. Schools can take advantage of ences by identifying, analyzing, and practicing how best MBA students’ social networks outside the classroom to to manage when faced with economic, institutional, and create more international synergies, which in return will cultural differences across countries. They should also help them develop a more global leadership style. help them develop deeper cultural awareness. In his closing remarks, IESE’s Dean Jordi Canals Leadership skills were also highlighted as a crucial thanked Datar for his strong drive to organize the Bar- area, and schools should focus on individual develop- celona conference, and noted the “passion” that the par- ment based on assessment, challenge and support, pan- ticipants all shared for improving business education and elists stressed. society at large.

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 39 c r o s os r oi a d s

global business and Universal Values Symposium on Ethics, Business and Society

he 17th International Symposium on Eth- what our differences are, but what do we have in com- ics, Business and Society opened on the mon? What can we see beyond these differences?”Carlos Barcelona campus this morning to discuss Sánchez-Runde, professor of managing people in orga- “Universal Ethics. Cultural Diversity and nizations, asked “how can honest companies compete Globalization.” Dean Jordi Canals, in the in corrupt environments and what is the ethical impact welcoming address, emphasized the im- of bribes on those who pay them and those who receive portanceT of learning to work with diversity and of respect- them?” He said he believes that conflicts over practices ing the universal human values that prevail beyond cul- can be harder to deal with than conflicts over values. We tures. The opening session was introduced by Domènec are always discovering universal values, he said, they are Melé, professor of business ethics and chairperson of the always in the making. symposium, who said that globalization and the way that Piotr Jaroszynski, professor of philosophy at the technology is shrinking the world are just two aspects of Catholic University in Lublin, Poland, explained that how human relations are changing. But for these realtions there are many ethical theories but only one human mo- to be truly human we must not lose sight of the our com- rality which should be discovered through what contrib- mon humanity, he said. This demands solidarity and a utes to human flourishing. sense of global brotherhood. The first day ended with a panel discussion on univer- He was followed by Joan Fontrodona, also a profes- sal ethics and cultural relativism with João Luís Alves sor of business ethics, who commented that “we know César das Neves, professor at the Economics and Busi-

40 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE for human relations to be truly human we must not lose sight of the our common humanity” Prof. Domènec Melè

totle’s ideas about virtue and drew out the considerable similarities. For both, virtue is elevated excellence which is proper to human beings and fundamental to one’s humanity, she said. The final roundtable, titled “Multinational Corpora- tions and Human Rights in the Globalization Context,” was moderated by Prof. Antonio Argandoña. He stressed that while the term “human rights” has only recently found its way into the vocabulary of corpo- rations, it is a subject that is at the core of the CSR field. Ramón Mullerat, former co-chair of the Human Rights Institute of the International Bar Association (IBA), noted that the United Nations Declaration of Human Rights was aimed at governments when it was penned in the 1940s. However, increasingly companies are embracing the

Prof. Antonio Argandoña, Joaquim Borrás, Beatriz Bayo, declaration’s principles because they realize they have a Arantza Hernanz and Ramón Mullerat responsibility to protect human rights. Joaquim Borras, executive president of ISS Facility Services in Spain, emphasized the universal importance of respect and treating people well, adding that “ethics is value” and described how ness School of Universidade Católica Portuguesa and his company has grown to 534,519 employees in 53 countries Ana Marta González, professor of philosophy at the in part through “giving people a sense of purpose.” University of Navarra. The session was chaired by An- Arantza Hernanz, corporate responsibility manager tonino Vaccaro, professor in IESE’s Department of Busi- at Repsol, discussed the oil and gas company’s policies ness Ethics. They emphasized the importance of moving toward human rights, and how it seeks collaborative and from a relativistic view to a pluralistic one, as a way of consensual approaches, particularly when operating in respecting diverse perspectives of values and finding regions populated by indigenous groups. common ground when there is conflict, taking as a ref- “Human rights may be a new expression in business, erence the natural moral law. Moreover, as the impact but the issues are not new to us,” Hernanz said, noting of multinational companies on society escalates, firms that Repsol is currently ranked as the world’s most sus- must increasingly take the “Spiderman effect” into ac- tainable oil and gas company by the Dow Jones Sustain- count – that is, that “With great power, comes great re- ability Index. sponsibility.” Finally, Beatriz Bayo of the fashion retailer Mango, The second day began with a session moderated by said that her company’s approach toward respecting hu- Prof. Alberto Ribera titled “East Is East, West Is West, man rights flows from its three fundamental values: har- and Always the Twain Shall Meet” in which Daryl Koehn, mony, humility and human worth.“The most important professor of ethics and business law at the University of thing for us is to do business,” she said. “But there are St. Thomas, Minnesota, compared Confucius and Aris- many ways to do business.”

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 41 c r o s os r oi a d s nine schools, one Case study Schools from Europe, the United States and Asia make annual contest the biggest yet.

ESE’s International Case Competition was held Science and Technology; INSEAD, France; Northwestern March 22-24 on the Barcelona campus, drawing University, USA; LBS, London Business School, Univer- teams of students from diverse countries and sity of London, UK; Richard Ivey School of Business, the many of the world’s top business schools. IN- University of Western Ontario, Canada; RSM, Rotterdam SEAD was named the overall winner, with Hong School of Management, the Netherlands; Yale School of Kong University of Science and Technology taking Management, USA and IESE, Spain. secondI place in the final round of the competition. The competition kicked off with a welcoming ceremony The event, which this year marked its 17th anniversary, on Thursday afternoon, followed by a working session, has become a hallmark event at IESE. This year, an unprec- then two more days of intensive work on a specific busi- edented number of business schools from India, Europe ness case. The teams made case presentations on Saturday and the United States sought to take part in the compe- in two rounds, with the final winner announced on Satur- tition, which has a limit of eight participating teams, said day afternoon. The winning team was awarded an intern- MBA student Manish Handa, who co-organized the event. ship at Roland Berger. “It was started 17 years ago, so it’s now like a legacy,” he said. “Every year we see more students interested in it The Case: Mango and more students involved in running it, so it’s a very big This year, the teams prepared a case focusing on the competition for IESE.” lglobal fashion retail company Mango, written by IESE With sponsorship from Roland Berger, the annual event Prof. Joan Enric Ricart and Izabela Kordecka. Xavier attracts culturally diverse and multilingual MBA teams. Carbonell, director of corporate social responsibility for This year’s event included MBA students representing Mango, addressed the student teams during the event. the following schools: CEIBS, China Europe International The case focused on Mango’s move to enter new indus- Business School, China; HKUST, Hong Kong University of try segments in order to broaden its main target market,

42 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE strengthen its brand and drive purchases of its products. in a highly global context. Teams who take part must Mango’s main customers had been modern, fashion-con- be multicultural and be made up of first-year MBA stu- scious young women in their 20s to 40s. However, suc- dents. Fluency in English and a language spoken at an- cess in the women’s fashion segment persuaded the com- other Roland Berger office is a prerequisite for all team pany that in order to continue to succeed in this industry members. and stay ahead of the competition it needed to explore IESE’s Consulting Club took steps to make the 2012 new market niches (launch of a VIP collection - Mango edition of the event highly visible in the United States, Exclusive Edition - and a menswear collection). he said. “That was our big focus this year.” The case gives a general view of the company’s overall The MBA office provided essential support in con- strategy, taking a look at each of the key departments to tacting other MBA offices in the United States, and detect their strengths and differentiating factors (human IESE’s Consulting Club reached out to consulting clubs resources policies, technology, production, marketing, at other U.S. business school campuses to inform them distribution and internationalization). It also analyzes of the event. IESE MBA students currently studying at the strategic decisions and management practices that other leading business schools through the school’s have led Mango to establish its own business model, one international exchange program also served as ambas- that is difficult to imitate and in which people and tech- sadors for the competition, he said. nology play a leading role. This model is analyzed in detail For Handa, the event offers an invaluable opportu- using strategic decision trees. nity to network and learn. “It was something I wanted to be part of. I get to meet students from other business Networking Opportunities schools, interact more closely with the MBA office and The IESE Case Competition provides a unique op- interact with Roland Berger consultants. So the whole l portunity for MBA students to network with peers experience is really good.”

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 43 c r o s os r oi a d s

14th luxury goods industry meeting social networks trace the future frontiers of luxury

he 14th Luxury Goods Industry Meeting that the market depends on four factors: HNWIs, new was held at IESE’s Barcelona campus in markets, high cash conversion and brands. However, he April under the title “Balancing Scale believes that brands themselves are losing value in a dy- and Creativity.” After an introduction by namic and fragmented brand landscape. Prof. Fabrizio Ferraro, who organized The session, “The Changing Landscape of Retailing,” the meeting with Prof. Pedro Nueno, the was moderated by Pierre Mallevays. The speaker was firstT session, “The Investment Landscape,” began with Geoffroy de la Bourdonnaye, former CEO of Liberty, an overview of the market by Luca Solca, global head of who charted the history of Arthur Liberty, who was a pa- European research, CA Chevreux. He said that 40-60 per- tron of the arts, a globe trotter and curator who wanted cent of sales and more than 100 percent of growth comes to find a way of translating the fashions, such as the ki- from emerging markets. Then Pierre Mallevays, founder mono that he found in the Orient to suit English tastes. Savigny Partners, said the sector has become more pro- When a group of investors bought Liberty from the fam- fessional and more attractive to investors. Luxury brands ily in 2000 the idea was to reconnect with the soul of the are in a virtuous circle of high desirability, high margins store’s founder and to embrace the flower power of Lib- and high growth, he said. erty prints. Andrea Ciccoli, CEO, The Level Group, talked about This was followed by a session on fashion titled “From luxury and value from an investment perspective. He said Creativity to Value” that was moderated by Barbara Slav-

1 2 3 4

44 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE ich of the Ieseg School of Management. Mikael Schiller, Trust in traditional media has plummeted while trust in chairman Acne Studios, which was founded in Stockholm “earned” media has exploded. and cross-fertilizes between fashion, advertising, en- Elena Foguet of Value Retail Spain suggested that cit- tertainment and design, said that “entrepreneurship is ies strive to create opportunities from within by creat - about making the impossible possible.” ing new pockets of consumption, thereby becoming more He was followed by Andrea Baldo, general manager of attractive for shopping tourism. New York’s shopping Diesel Black Gold who said “in 2009 we saw the start of tours or Dubai’s Shopping Festival, which attracts more luxury fatigue in mature markets.” Diesel put credibility than three million visitors each year, are examples of how at the center of accessible luxury. You need to learn the this can be done. In Europe, Chinese and Russian tourists art of storytelling and create a vision that inspires people, accounted for one-third of tax-free sales. he said. Next, Manuel Ehrensperger of Swarovski shared his Prof. Frédéric Godart from INSEAD talked about his company’s impressive growth from 2000-2010 as a case book Unveiling Fashion which is about the business of study on how retail expansion is possible. The key fac- fashion. There are tensions between the designers, who tors in the Swarovski success story were targeting new care mainly about their art, and the business side. The consumers and new categories. Although the brand used last morning session focused on the “Digital Revolution to be known exclusively for its figurines, today it has ex- in Luxury Goods: Marketing, Branding and Retailing” panded its line to include sunglasses and watches. which was moderated by Prof. Fabrizio Ferraro. Frank Emphasizing geographic location can be another as- Vivier, group director of e-business at Richemont Inter- pect of growth strategy for luxury goods companies, national, said what everyone is asking is how to leverage according to Daniel Talens of La Montre Hermès Asia the growth of social networks and how to use them to Pacific. Talens insisted that the basic principle of un- build brands. The Internet creates flexibility but it is also derstanding the cultures you are targeting is essential extremely disruptive. Half of all watches costing more for the luxury goods and understanding your market’s than $3,000 are bought after an Internet search. worldview is the prerequisite to successful sales. Giuseppe Guillot is chief operating officer of Yoox In the closing session, moderator Sean Ansett of At Group fashion retailers which has its headquarters in Stake Advisors warned that our current ecofootprint is al- Bologna. “We presented ourselves to brands as an e-com- ready 50 percent greater than what the earth can maintain. merce store and then leveraged our platform.” They now Furthermore, consumers care more and more about envi- run 32 online stores on behalf of major brands. They pro- ronmental issues and subject companies to close scrutiny. vide the technology and the expertise but it’s the brand One effect of this is that pressure groups are increas- that drives everything. ingly setting the agenda, said Allanna McAspurn of He was followed by Pedro Esquivias of the Boston Made-By, the first fashion initiative to focus on envi- Consulting Group who talked about unleashing the ronmental concerns. Eduardo Escobedo of UNCTAD power of consumer advocacy. He said the average West- added that, as a society, we are shifting our concern from ern consumer is bombarded with between 300 and 3,000 “sustainability” as a concept to actually seeking to lead brand impressions a day. Many luxury companies are sustainable lifestyles and that consumers do care that struggling to make an impression in the digital market. businesses set environmental benchmarks.

1. Prof.Fabrizio Ferraro 2. Luca Solca 3. Pierre Mallevays 4.Andrea Ciccoli 5. Geoffrey de la Bourdonnaye 6. Giuseppe Guillot 7. Mikael Schiller 5 6 7 8 8. Frank Vivier

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 45 c r o s os r oi a d s japan earthquake commemoration “Transparency Vital to Win Back Confidence”

“There is a 70 percent chance of a l7.0 quake in Tokyo in the next 30 years. What this has taught us is that something that might only happen once in a 1,000 years can happen,” Hi- dehiro Tsubaki, the Japanese consul general in Barcelona told a meeting gathered to commemorate the first anniversary of the earthquake and tsunami that left almost 19,000 people dead or missing, over 300,000 displaced and 374,000 houses destroyed and caused some €250 billion of damage. Prof. Pedro Videla, Prof. Franz Heukamp, Koichi Ooura and Hidehiro Tsubaki Japan received offers of assis- tance from 163 countries, including many poor and developing countries, said. “Transparency is vital to win back was lack of information coming out of Tsubaki said, and rescue teams came the confidence of the people,” he said. the affected zone, exacerbated by the from 22 countries. Japan is very grate- He was followed by Koichi Ooura radiation problems created by the Fu- ful for all this support, he said. The of the Bank of Tokyo-Mitsubishi Bar- kushima nuclear power plant disaster, explosions and radiation leaks at the celona sub-branch, who said that he said. Special teams were set up to co- Fukushima nuclear plant have led the industrial production slumped by ordinate the recovery and this contrib- Japanese public to demand a move record numbers in March after the uted to its speed. “It will be difficult to away from reliance on nuclear power. quake but began to pick up in April. change the mode of energy production This summer Japan will publish a new One problem was that the just-in-time but Japan is a leader in the manufacture strategy and will create a cutting-edge approach meant than many factories of solar panels,” Ooura said. “What is model for energy creation, including didn’t have inventory. In the immedi- clear is that Japan is changing in the wind, solar and wave power, Tsubaki ate aftermath, the biggest problem wake of the tsunami.”

IESE Students Put Their Money on Risk Capital

First-year MBA students Olga ing the organizers of the event. petition at this level, says Romeu, lNikiforova, Martins Mellens, This year’s competition included a adding that he hopes it will David Riphagen, Jaime Sanjuán and real case with all the original docu- grow even more in the future. Pablo Sanint made up the Pearson 21 mentation, said Ignacio Romeu, one Sanint , a member of the winning team that won the 2nd Private Equity of the organizers. team, has worked in the sector. He Competition. The competition was There were also profession - says that a benefit of the competition is held on March 9 on the Barcelona cam- als from the risk capital sector on getting real-time feedback from partic- pus and was organized by the Private the jury which added to the au- pants such as professionals from funds Equity Club and sponsored by KPMG. thenticity of the negotiations. such as The Carlyle Group, Doughty The jury praised the students’ IESE is the only business school Hanson & Co., Change Capital Part- high standards as well as prais- that runs a Private Equity Com- ners and Lion Capital Partners.

46 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE financial times rankings IESE Ranked Nº 1 For Executive Education

School jumps from third to first place in survey of 50 major schools and earns top marks for client satisfaction.

IESE Business School has learned the number one spot in the Financial Times’ 2012 overall ranking of business schools offering executive education programs. This year, the school rose from number three to number one in the annual ranking. In this year’s survey, which spot- lights the 50 top schools worldwide, the school earned particularly high marks for participant and client satisfaction. Positive results in these areas was due to feedback gathered from participants and client partners. The FT survey examines a wide IESE offers open executive edu- gram New York-Miami, which are range of program characteristics, cation and custom programs at key aimed at entrepreneurs and senior which are rated on a 1 to 10 scale. locations around the world, includ- business leaders of global firms. Data is compiled using input from ing Barcelona, Madrid, New York Key partners in custom program business school clients and statis- City, Munich, Sao Paulo and War- initiatives have included Abbott, tical data from schools themselves. saw. Among its offerings are the Ad- Airbus, BBVA, Faurecia, Henkel, The survey encompasses three vanced Management Program, the Nestlé, Novartis, Oracle, Santand- rankings: open enrollment, custom Program for Leadership Develop- er, SAP and Telefonica, among and combined (overall ranking). ment and theSenior Executive Pro- many other leading firms.

l continuous education “One of the causes of the collapse “The collision between the two cul- of the Japanese empire was the way tures has opened the way to greeater its army fought. Units acted autono- mutual understanding,” Slocum The Twain mously without a clearly defined said. She added that the presence global strategy,” Prof. Kimio Kase of Japanese multinationals operat- Shall Meet said during a Continuous Education ing in the United States combined East-West session on IESE’s Madrid campus. with Western business’s adoption He was taking part in a session titled of Asian approaches such as just- Management “Asian Versus Western Management in-time, quality management and Thinking” along with Alesia Slocum, knowledge management are all part Thinking professor of management and mar- of a bilateral apprenticeship that has keting at the University of St. Louis, been taking place since the end of the Reviewed and Yingying Zhang from CUNEF. Second World War.

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 47 c r o s os r oi a d s

CAREER SERVICES TAKES MBA STUDENTS ON FACT-FINDING TRIP There’s a Lot More Than Coffee in Brazil

A packed agenda meant that a It was an extremely positive expe- and as a result they are becoming more lparty of MBA students succeeded rience, said María Amelia Salerno international. That’s why they need in meeting executives from key compa- of the MBA career services depart- people with a global outlook who can nies during their trip to Brazil. “We met ment. “We visited a dozen compa- lead in different milieu and cultures. As top executives while we were there,” nies in four days and in four or five there are more than 70 nationalities in said Raul Salles de Padua, a Brazilian there are job opportunities for our IESE’s MBA classes we have an advan- who was among the dozen MBAs who students,” she said. These com- tage over other business schools.” participated in the trip organized by panies are organizing a summer In 2011, 10 alumni found work in IESE’s Career Services department. project that MBA Brazil and it is hoped “There seem to be unlimited oppor- students will partic- that there will be tunities for MBA graduates in Brazil,” ipate in from June We have four more this year, he said. “Brazilian companies need to September. “This already found not including those managers who are capable of making is a valuable way for working in the sum- decisions that will contribute to the the company to as- work opportunities mer project. Salerno country’s economic growth and the sess the candidate in four or five emphasized that this sustainability of its business.” and if they wish companies trip was a special “As a result of coming here I know they can offer them initiative because a lot more about Latin American busi- a job after they have European-based ness and I understand Brazil much graduated,” Salerno said. multinationals already look for peo- better, precisely at a moment when One of the students on the trip, ple of various nationalities to work in developed countries face recession Tomaz Mota Capitão, will be work- Latin America and Asia. MBA Career and mounting debts,” he said, adding ing this summer at Votorantim Ci- Services aims to open and extend a that many issues that they had dis- mentos, one of the companies they network of contacts and opportunities cussed in class came up again in their visited. Mota Capitão said “the big that is open to all graduates regardless meetings with executives. Brazilian companies are expanding of where they come from.

Mª Amelia Salerno, Tomaz Mota Capitão and Raul Salles de Padua

48 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE AGENDA EVERYTHING THAT’S HAPPENI NG 2012-2013 www.iese.edu/agenda Water July 2012 Management Industry Optimizing your Retail Business: Best-in-class Operations and Customer Service BARCELONA, 10, 11 & 12 Meeting Madrid, 12 Revolutionize your Business with Social Media and Collaboration NEW york, 10, 11 & 12

September 2012

25th EBEN Annual Conference 19th BARCELONA, 19, 20, 21 & 22 Healthcare Industry October 2012 Meeting Barcelona, 2 & 3 Arts & Cultural Management: From Service Design to Success NEW YORK, 9, 10 & 11 27th Meeting The WSJ Viewpoints Executive Breakfast Series NEW YORK, 31 of the Automotive November 2012 Industry Barcelona, 6 & 7 Developing Leadership Competences BARCELONA, 6, 7, 8 & 9

Advanced Digital Media Strategies: Profiting From the Digital Value Chain NEW YORK, 13, 14 & 15 Global Alumni Reunion December 2012 São Paulo, 1 & 3

2nd Campaign Management Program madrid, 13, 14 & 15

Global Business: Leadership in a Matrix NEW YORK, 3, 4 & 5 February 2013

High Performance Negotiator barcelona, 5, 6 & 7

March 2013

Achieve Business Transformation Through IT NEW BARCELONA, 5, 6 & 7

Create Effective Virtual Teams BARCELONA, 12 & 13

Make Change Happen More Effectively NEW BARCELONA, 19, 20, 21 & 22

April 2013

Put Strategy into Action by Managing Key Projects NEW BARCELONA, 23, 24 & 25

May 2013 Graduations 2013 Develop your Communication Skills: It’s How You Tell Them BARCELONA, 7, 8 & 9 3rd International Barcelona & Madrid Getting Things Done Conference on barcelona, 21, 22, 23 & 24 Humanizing the June 2013 Firm and the Management Profession Maximize your Board’s Potential NEW barcelona, 4, 5, 6 & 7 Barcelona Managing People Across Cultures BARCELONA, 18, 19 & 20 European July 2013 Conference of the Association for Consumer Optimizing Your Retail Business BARCELONA, 9, 10 & 11 Research (ACR) Barcelona, 4, 5, 6 & 7

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 49 C R O S OS R OI A D S ACADEMIC SESSIONS AND WORKSHOPS ACADEMIC SESSIONS EXTEND 3, 2, 1… THE COUNTDOWN BEGINS FOR THE GLOBAL ALUMNI REUNION BRAZIL 2012 A PERFECT COMBINATION: LEARNING AND NETWORKING LEADERS OF CHANGE YOUR VISIT The Global Alumni Reunion this year is presenting a different and unique program in which, as well as stimulating academic sessions, The academic program is divided into six panels, each of which will discuss the key issues there will be a series of workshops that will analyze the personal and professional challenges for investing in Brazil. affecting business and the economy. Take advantage of your visit to get to Get to know Brazil PROFESSOR know Brazil, the land GERALDO ALCKMIN 19.00h AFTERNOON EDUARDO GOVERNOR of opportunities. Add MARTÍNEZ Health, technology, energy, finance, RECEPTION AND OF SÃO PAULO MORNING 16.00 h a few days to your ABASCAL globalization and, of course, we couldn’t do 8.30 h Why go to Brazil this year? An intense WELCOME GUIDED TOUR OF SÃO PAULO without a panel on big events. Leaders, visit to Sao Paulo to make trips to other IESE in Latin Palácio dos Bandeirantes WORKSHOPS “INSIDE BRAZIL” The Barrio Oriental, the Plaza and the business people, executives and academic program combined with 21.30 h important cities such In the presence of the ISE Catedral da Sé in the city center, the entrepreneurs will share their views of the GALA DINNER as Rio de Janeiro governor and mayor Higienópolis and Morubi districts, the present and their vision of the future. There’s America networking opportunities and cultural Investing in Brazil (population 6 million) of São Paulo museum of precious Brazilian stones, no doubt that they will be six panels full of Buffet Torres IESE’s Latin American community and Curitiba activities is a way to immerse your- Talent the financial center, the Municipal new ideas that, as at all assemblies, will be 19.00h (population 1.7 comprises nine associate schools Entrepreneurs Market… inspiring and oriented towards action. self in Brazil, a major international MASS million). Share the in nine countries 1 NOVEMBER 2 NOVEMBER 3 NOVEMBER economy. The Global Alumni Reunion diversity and MEXICO dynamism of the IPADE (1967) welcomes everyone from IESE’s Latin country that is 1.00h 1.00h 7.00h 7.00h 3.00h 3.00h 5.00h 5.00h 4.00h 4.00h 2.00h 2.00h 8.00h 8.00h 6.00h 9.00h 6.00h 9.00h shaping the third 11.00h 11.00h 17.00h 17.00h 13.00h 13.00h 15.00h 15.00h 14.00h 14.00h 12.00h 12.00h 21.00h 21.00h 21.00h 18.00h 18.00h 19.00h 16.00h 19.00h 16.00h 19.00h 23.00h 23.00h 23.00h 10.00h 10.00h 24.00h 24.00h 24.00h 22.00h 22.00h 22.00h American community. 20.00h 20.00h 20.00h millennium.

ACADEMIC SESSIONS COLOMBIA Sheraton Sao Paulo WTC Hotel GUATEMALA INALDE IESE’S GLOBAL UNIS (1977) (1985) ALUMNI REUNION IS HELD ANNUALLY ALTERNATING BETWEEN ECUADOR Atlantic CHARTING PATHS IDE (1992) Ocean BARCELONA AND IN E-HEALTH CHARTING THE IMPACT GLOBALIZATION MADRID. OF THE WORLD’S ICONIC CHARTING TRUE DR. LLUÍS DONOSO EVENTS BRAZIL SINCE 2000, EVERY Director of the Diagnostic Imaging THE ENERGY “CONNECTEDNESS” Department, Hospital Clínic in SECTOR, CHARTING ACROSS BORDERS AND THREE YEARS IT EDUARDO PAES EDUARDO PAES. Graduate in Law from the Law 70.460 Barcelona TRANSFORMATION? CONTINENTS 52.709 HAS BEEN HELD Mayor of School at the Pontifical Catholic PERÚ THE PATHS OF GIOVANNI CERRI Río de Janeiro University of Rio de Janeiro PAD COUTSIDE SPAIN INNOVATION AND IESE CHAPTERS IN THE WORLD 2,6 Secretary for Health, São Paulo and (PUC-RJ). Began his political PAULO RICARDO STARK PANKAJ GHEMAWAT (1979) GERHARD HEIBERG Director of the Institute of Radiology career in 1993 when he was only TECHNOLOGY IN Executive president. Siemens Brazil Professor of Strategic Management Brasilia 2000 Amsterdam Member of IOC UNITED of the Hospital das Clinicas, School 23 . He currently works out of the THE WORLD OF MEDIA EDUARDO MARTÍNEZ ABASCAL at IESE 6,3 2003 London and Director of mayor's office organizing the of Medicine, University de São Paulo STATES Marketing of the Professor in the department of DANIEL SERVITJE 12.667 Rio de Janeiro (FMUSP) football World UNITED 2006 Munich International SANTIAGO FERNÁNDEZ VALBUENA finance at IESE since1992 Managing Director of Grupo Bimbo Pacific Cup in 2014 and the Olympic KINGDOM São Paulo 2009 NewYork NÚRIA MAS Olympic Ctte CEO of Telefónica KEES STORM Ocean 1,1 Games in 2016. Latin America 1 BRAZIL 2012 São Paulo Professor of Economics at IESE PAULO RICARDO STARK. Graduated in Chairman of the Board of Directors, FRANCISCO MESQUITA electrical engineering at the Centro AmBev CHILE CEO Grupo Estadão Federal de Educação Tecnológica do 2 ESE, BRASIL GIOVANNI CERRI. Trained LLUÍS DONOSO. Gold medal from the Paraná. Member, among DANIEL SERVITJE. Graduated in 3 (1999) ISE (1996) JORGE NOBREGA ARGENTINA URUGUAY as a doctor at the Spanish Radiological Society. Corporate Vice President, Globo others, of the Advisory business administration from the IAE IEEM School of Medicine of Honorary member of the Argenti- SOURCE: Board of Nokia Siemens Universidad Iberoamericana. (1978) (1986) São Paulo University. Is nean Radiological Networks and the MBA from Stanford Instituto Brasileño SANTIAGO FERNÁNDEZ VALBUENA. de Geografía y currently president of Society, Mexican Advisory Board of the University. Joined 15% of students Graduated in economics from MBA Estadística the Cancer Radiological and Brazilian Electrical and the board of Grupo following the the Universidad Complu- Council at São Imaging Society, Electronics Bimbo in 1991. In IESE MBA tense, Doctor and Masters GDP for 2009 Paulo State, and image, the CHARTING PATHS IN Industry Associa- 2011, he was voted in million of € in Economics at Northeas- program in University Italian Radiological THE FINANCIAL tion (ABINEE). “Personality of the tern University in Boston. Barcelona are in São Paulo. Society, the French INDUSTRY AND THE Year” by Expansión Before joining Grupo Latin Americans Millions of Radiological Society TURBULENT magazine. IESE associated business schools (year founded in brackets) inhabitants in 2010 and the German Telefónica he was managing Radiological MACROECONOMIC director of the Société Society. ENVIRONMENT Générale Valores and PANKAJ GHEMAWAT. Author of the Director of the Stock celebrated book World 3.0, for which he 2 4 5 6 8 MIGUEL JORGE Exchange in Beta received the 50 Thinkers Book Award, Brazil in Brazil’s former minister of Capital in Madrid. he was also the youngest guru in the list industry and external trade of top thinkers of all times published by world The Economist in 2008. He is the author rankings DIRECT ECONOMIC EXPORT GROSS of more than a hundred articles and FOREIGN INTERNET FORECAST OF RAW TELEPHONE MOBILE GOLD AND SIZE OF DOMESTIC INVESTMENT USERS 2020/30 POPULATION MATERIALS LAND MASS LINES TELEPHONES CASH RESERVES WORKFORCE PRODUCT case studies. Sign up FROM A TO Z…

ere are many other interesting cities that fall within Sao Paulo’s now! sphere of inﬂuence which you can visit to get to know Brazil better.

Brasilia e federal capital, it has the ONLINE honor of being the only city built in the 20th century to be declared a REGISTER AT Unesco Heritage Site. http://www.iese.edu/global alumnireunion Curitiba Situated on the high Paraná plain, it is the biggest city in the south of the country and one of the richest FLIGHT DISCOUNTS in Latin America. BEST OFFERS AVAILABLE Guaruja http://axbv.net/iese/ BLOG e third biggest island oﬀ the index_english.html STAY UP coast of Sao Paulo, it is a spa that TO DATE is 4.27 meters above sea level. http://blog.iese.edu/ chartingpaths/ Piracicaba An important industrial (metal, machinery, textiles, food and fuel) and agricultural center situated in one of the most productive regions in the state of Sao Paulo.

Rio de Janeiro e former imperial capital and the country’s second biggest city, Rio Update your is Latin America’s premier tourist details and win destination and the ﬁrst Olympic a dinner for your SOCIAL NETWORKS city in South America. cohort FOLLOW US ON… Santos http://www.facebook.com/alumni.IESE Santos is 60km south of Sao Paulo http://twitter.com/iesealumni and is the largest port in Latin America. It also boasts the world’s http://www.linkedin.com/company/ longest waterfront garden, the iese-business-school Jardines of the Santos shore. http://www.youtube.com/IESE

São Paulo e biggest city in Brazil and Latin America. It is the country’s SPONSORS ﬁnancial center and one of the PLATINUM: Ricoh most important in the world. GOLD: Ajuntament de Barcelona

SILVER: Ermenegildo Zegna / Singapore Airlines P E O P L E ALUMNI Julio Rodríguez (PDG ‘97)

“You Need New Goals to Keep the Thrill Alive” MARTA SARDÀ

Julio Rodríguez, executive vice president here are not many executives who can say that they have worked for the same com - of world operations at the multinational pany for 28 years and claim that they’re Schneider Electric, says he is excited just as excited as they were on their first by every new challenge that presents day. Julio Rodríguez who in 1984 began working at Schneider Electric’s first fac- itself in his professional life. He currently Ttories in Valencia, is among the fortunate few. faces the challenge of managing a team Aren’t three decades an excessive time to spend in the of 11 different nationalities. same company? When I give conferences people sometimes ask me exactly that and I always say the same thing: for companies, growth is like blood, it’s fundamental for life. And that’s true for a lot of reasons, but from the point of view of management talent is that it is what allows you to attract, keep and develop executive talent. I have spent 28 years in the same company and have taken on 10 distinct responsibilities during that time and each

52 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE one has involved a different challenge. Each one of these members are important, but so are others such as mod - responsibilities was like starting from scratch and rep- esty, because a modest person always puts the greater resented an exciting challenge. good above their own interests. But I also think efficiency is important because you’ve got to be thinking about You have often highlighted commitment and loyalty results. But all of this has to rest on a central axis - pas- as essential values. Is that part of how you understand sion. Being passionate about what you do is fundamen- leadership? tal and is probably one of the most contagious emotions For me they’re both important things. The first I under- in existence. It’s very important to have passion if you stand as the commitment you have to your family, to an are going to develop passionate teams. idea, to the company and to your team and, therefore, it seems to me a fundamental value. And I see loyalty as And are these the characteristics of a good leader? the ability to stay faithful to ideas and to others which A leader may have many characteristics but I think these obliges you never to deceive or betray them. ones are essential.

Do you prioritize these values in the people you work How do you recall starting at Schneider Electric? with? It was in 1984 and I was only 23 years old. I was a recent - I think they’re important, but they’re not the only ones. ly graduated engineer and I was looking for a company Commitment to the team and loyalty between all of its that could give me the chance to develop professionally

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 53 P E O P L E when a problem arises i always share it with 7the team because you need to find solutions and i’m not a great believer in superman. you always find the solution by working together. my recipe is you should share the problem”

over the medium term. I had two or three other offers of my wife and my two children. The fact is that from a per- work but what I saw at Schneider was the prospects for sonal angle my wife Marisé realized that this was also growth and the ability to see what I could do in the mean opportunity for the family and we decided to take on dium term, which is why I decided to accept their offer. the challenge.

In those early years did you come across those values What did it mean professionally? which you consider so essential? Looking back, I realize it was like pressing reset, setting At the beginning I was responsible for planning at the everything back to zero, because I went from being an oldest factory in the group, which was in Valencia. executive in a local environment to being one in a global I didn’t have a team and I worked on my own but as I environment, in a new country, in a new culture, with have moved towards more executive posts I have always a new market, new clients and, above all, with a new sought these essential values. When you create a team team which you have to win over starting from zero. I you have to build it up around them and you have to realized that whatever I’d done before was not going to know that the members share them and that you lead help much. I believe that this experience, this enforced by example. It’s something I always look for in team modesty, and going back and starting from zero, win- members. It’s the basis of everything I do. ning over the team and sharing objectives is a magic moment in anyone’s career. It’s a change that helps you When you suffer a setback how should you act? develop both as a person and as an executive. When a problem arises I always share it with the team because you need to find solutions and I’m not a great Do you think those values that you feel are so impor- believer in Superman. I believe you always find the tant are international or do they belong to the culture solution by working together, through creativity and of a particular country? through talking around the topic. My recipe is that you Every culture is different and some of these values should share the problem with your people. might also have a different weight in different cultures. In any case, the team that I’m leading at the moment, What has been the defining moment in your profes- which is comprised of 11 different nationalities, pos- sional career? sesses these essential values and everyone shares them. Although because of my training as an engineer I began working in the technical area at Schneider Electric, al- In April you were appointed executive vice president most immediately I realized that I liked being around of world operations. What does this new responsibil- clients. After a couple of years in this first job I took on ity entail? responsibilities more related to sales and marketing. I Within the Group Executive Committee I am respon- held various executive positions in Spain before I ar - sible for operations at company level. It’s a great chal - rived at what I consider to be the defining point in my lenge because these sorts of global responsibilities in career, from the point of view of my development as an a company with a turnover of €23 billion and 120,000 executive. It was when the company gave me the chance employees in 110 countries are only achievable if you’ve to move to Brussels as general manager of Schneider got a top quality professional team, people to whom you Electric Belgium. It was a critical moment both profes- can really delegate decision-making. Mine is made up of sionally and personally because I’d always been in Spain 15 managing directors, and each one of them manages and it was an adventure for me and also for my family, a region in the world and they represent between them

54 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE 11 different nationalities. It’s an exciting challenge and even though I’ve spent nearly three decades in this company, for me it feels like I am starting over.

What motivates you most about your current job? It’s a new reponsibility that is very exciting because I have the opportunity to develop and accelerate the growth of our business in many parts of this fanstasti- cally global world that we live in and which is changing at a vertiginous rate. On the other hand, being able to make a contribution for what is the axis of our fundamental strategy, energy efficiency, is very appealing. I believe that we are doing something that, apart from being good for the company and for our shareholders, is very good from a collective point of view. Our aim is to contribute to the sustainability of the planet and we do it by making sure that our clients benefit from lower costs through lower energy consumption and by limit- ing carbon emissions.

How important was your time at IESE for your professional career? That was another key moment in my career. When I ar - rived at IESE I had a good functional understanding of the areas in which I had worked but I lacked a global vision, which is essential if you are going to assume the general management of a company. I acquired a global vision here at IESE, in the classroom with my colleagues and the professors.

What stands out from those years of study? Firstly, a lot of work. I recall that we worked pretty hard preparing cases but at the same time were motivated because we saw that every day we were learning faster and faster. I recall pretty intense work but with a hunger to learn and to share the experience of the others. I also recall with much affection the many impassioned argu- ments regarding the case studies. It was an interesting and enriching experience and you realize that the same problem can be approached from completely different points of view. I think that’s the great value of the case study method.

Do you stay in touch with your former classmates? Not as much as I would like because we all have huge responsibilities and we travel a lot. However, although we don’t see each other much we do remain in touch. Furthermore, there are always fond memories.

Is it vital to approach every day as though it were the first day? Excitement is directly related and totally connected to how you deal with your own challenges. I have the good fortune to take on many interesting challenges and this helps you to carry on working as if it were the first day, with maximum excitement. People have to set themselves new goals because that’s the only way to keep the thrill alive.

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 55 Grant Taylor, MBA, United States

Lubov Sherysheva, G-EMBA, Russia

56 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE Olga Fuertes, EMBA, Spain OPENING THE DOOR TO A NEW Vanessa Moes, MBA, Netherlands FUTURE Graduates of masters and executive MBA programs reflect on a what has been a life-changing experience.

few days before they graduated, we inter- viewed MBA, Executive MBA and Global Executive MBA students. With all that they have experienced still fresh in their minds, they talk about what they have learned, not just about doing business Abut about themsleves, and how this has affected their plans for the future. Each of them has the sensation that they are on threshold of something new.

Nicolas Cosqueric, G-EMBA, France Grant Taylor (MBA ’12) Grant Taylor is from Seattle but was educated in Van- lcouver and New York. He studied geography and biology but, as it was a liberal arts university, he studied everything from economics to math to languages. After graduating he worked in Venezuela for a year and then moved to San Fran- cisco where he worked for a couple of years in consulting. He then worked in Washington, DC for three years as an analyst for hedge funds. “I went to a university where there wasn’t much diversity so I wanted to do an MBA where there were students from diverse backgrounds. I feel that diversity adds a lot of value to personal development,” Grant says. “Also at that time IESE was ranked number one in the world by The Economist. I already spoke Spanish but I thought by coming here I could take my Spanish to the business level. I’d never lived in Europe so it was an opportunity to get a European perspective among a student body that is probably more diverse than any MBA program anywhere. Things are going global and the best way to take advantage of that is to develop a global network.”

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 57 Carmelo Asegurado, EMBA, Spain P E O P L E

The first year is very hard work, he says, but in the second I am and how I am and how I work with people. You learn year students have more time to work on things that particu- what you’re good at and not good at and try to develop. You larly interest them and he has been working on a business can do an MBA online but you develop much more by having plan for a peer-to-peer lending start-up called Quotanda. the whole MBA experience.” Now she’s going travelling for Peer-to-peer lending, which began in the UK, consists of two and a half months. “It’s going to be hard to choose where loans between individuals and it’s diversified so it’s not just to go because now I know people from all over the world,” one person lending to one other person. “There are students Vanessa says. “Then in August I start working in Amster- who borrowed money to come here at rates as high as 10 per- dam with the Boston Consulting Group. I’m so happy I got cent,” says Grant. “I want to set this up here so students at the job because that’s what I wanted before I did the MBA.” IESE can get loans at reasonable rates from alumni who have been successful and who see this as an investment that is Lubov Sherysheva (G-EMBA ’12) giving them a reasonable return and at the same time sup- “The course is hard work but if you have fun it’s not so port students and mentor them.” lhard. The course is not very difficult from an academic He co-organized the Cleantech venture as part of the point of view for people who have real experience, which we Doing Good and Doing Well conference in which entre- all have. You have to contribute, and it’s an effort, but it’s preneurs with clean technology ideas get to present them an effort that is meaningful. It’s difficult for the family, es- to investors. “Cleantech is something I feel deeply about.” pecially for women, but if your partner shares your values “Coming here has given me the opportunity to fulfill my they can help you, says Lubov Sherysheva, deputy CEO of dream of becoming an entrepreneur and of developing the a large insurance company in Moscow. skills to do that. Beyond just the academic side, I’ve had I visited Insead and other business schools but what at- the opportunity to interact with people from 50 countries tracted me to IESE was the faculty. The faculty here are so around the world. Lots of business opportunities are lost supportive and so friendly. I was also attracted to the wide through a lack of cultural understanding and this school approach in the program structure here and the flexibility has really helped me to think more globally and gaining the from an academic point of view. confidence as well as the skills to become an entrepreneur Here they help you to help other people and to find mean- has been transformational for me.” ing in your life and to be open to other people’s needs because the program isn’t just about career development, it’s Vanessa Moes (MBA ’12) about personal development as well. You can hardly sepa- Vanessa grew up in a small town near Amsterdam. After rate the two. It has broadened my horizons and I see things lstudying Spanish and tax law at university she went on differently and of course it opens up new opportunities. to become a tax lawyer at a big Dutch law firm. She worked There is a story that was very popular with this Global there for four and a half years but wanted to change jobs and EMBA group. The professor of Management oneself once go into consulting. She thought it was a good idea to do an told us “guys, remember, each action has a consequence.” MBA because as a lawyer she worked in a highly specialized So one night when we were having dinner in a restaurant area. “I’m really glad I chose IESE because I love the case everyone was looking at the clock because it was about 12 method and the faculty is amazing,” Vanessa says. “What 0´clock but we were all so comfortable with each other and really stands out for me is the strong sense of community. didn’t want to leave and someone said, “remember we have And all the staff are really approachable. You can always go a class in the morning, and every action has a consequence.” to them with questions and they’re always willing to help “Being on top management position of the company you and they say they will be there for you even after the (believe me, after GEMBA it is just a matter of time) the MBA. All the exchange students who come here say they previously mentioned joke is always full of meaning for me love it and I chose not to go on exchange because I wanted when I make management decisions. From that perspective to reinforce my relationship here. Here you have a real sense the issue of sustainability is a major problem now and we all of family.” have a responsibility to adopt our everyday actions to this Although she doesn’t have any business background truly Global Goal.” she says the way they teach at IESE doesn’t assume that you have any prior knowledge. “What I love about the case Nicolas Cosqueric (G-EMBA ’12) method is that you visualize it, you have a case, and then you Globalization is “all about understanding others,” says go into theory. It’s less abstract and easier to remember. It’s lNicolas Cosqueric. The Sara Lee executive, who over- not just dry text; I’d had enough of that as a lawyer. During sees IT for the company’s coffee and tea division, said IESE’s my internship with the Boston Consulting Group, problems Global Executive MBA program was an “eye-opener” in this would arise that cases helped me understand.” regard, particularly the residential module in Bangalore, It has been an intense experience, she says, working with India. “In Bangalore, it’s another world and another set of a team of seven or eight people who come from all over the values,” said Cosqueric, who is French. “Take education. In world. “There are also a lot of soft skill courses that I took India, if you ask a 14-year-old what their objective is, it’s to because in order to be a good manager you need soft skills. go to school so they can have a life. If you ask a 14-year-old As a result of being here I’ve had a lot of insights into who here (in Europe) what their objective is, they will probably

58 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE Places of origin: PROFILE MBA Europe: 51% Average age: 27 Asia: 22% Prior professional Latin America: 11% experience: 4 years North America: 10% Nationalities: 54 Rest of the world: 6%

tell you something very different, that their objective is to “I have to admit at the beginning I was not convinced, enjoy their life.” but by the end of the module I think we were all convinced, Grasping cultural differences is central to understand- which was amazing,” he said. “I think the program has im- ing how global business works since these drive different pacted me in ways I’m not even aware of yet.” kinds of behavior, said Cosqueric, who has lived in France, Argentina and Spain and will soon head to Amsterdam in Olga Fuertes (EMBA ’12) his newly-assumed position. His decision to pursue the “I work for Montana Colors which is a medium-sized Global Executive MBA was a “family investment,” which lCatalan company. I’m in charge of national sales and he believes will have a direct impact on the performance I’ve realized that in the past three or four months I’ve be- of his job, he said. Cosqueric chose the IESE program over come more involved in management issues such as projects others because of the general management focus, which is in other areas, in planning and strategy and inter-depart- designed to catapult professionals to high-level roles, and mental decisions. This is largely because the masters helps the small class size, among others. you have a global perspective, to look beyond your depart- “It depends on what you want to do in life, but for me it ment and take a more horizontal view of the company,” says was clear this program was the one most adapted for my Olga Fuertes. needs,” he said. Standard MBA programs did not offer the She did the course to extend her education but she knew breadth of expertise among participants nor the opportu- she wanted to remain in Barcelona and with her current em- nity for such intensive interaction. “The whole learning ex- ployer, which is why she sought a part-time executive MBA perience is through the experiences of others, so you need program. Encouragement from her father who did a PDD to be able to interact,” he said. at IESE and an interest in the case study method clinched The program’s content was extremely balanced and the decision. “I was really keen to study using the case study touched on essential topics, while maintaining a focus on method. I studied administration and business manage- people-centered issues, he said. In every business case the ment so I had a grasp of the basics but I thought this style of class tackled, faculty members conveyed how executives teaching would be much more enriching.” can make a positive impact on society through excellent She was not disappointed. “It’s amazing how dynamic it leadership. is. What makes the method successful is the emphasis on Particularly memorable was the Leadership, Talent and the practical rather than the theoretical. It’s really valuable Character class led by IESE Prof. Santiago Alvarez de Mon, to be in a group of people from a range of sectors, each try- he said. At the start of the course, the professor challenged ing to give their best,” she says. “IESE also has the faculty the class to think about how many people in the room prob- required for this sort of approach and they know how to do ably had the ability to become leaders. Most participants it and do it well. On the other hand, I felt very comfortable concurred that only a few people in the world have what it with the values the school embodies and, although the pro- takes to be great leaders. The professor argued that anyone gram is very demanding, they understand that you have a can develop the capacity to lead effectively. life and a family outside the school.”She says the program

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 59 P E O P L E

Places of origin: PROFILE G-EMBA Western Europe: 40% Average age: 37 Latin America: 24% Prior professional Eastern Europe: 18% experience: 13 years North America: 6% Nationalities: 17 Africa: 6% Asia: 6%

requires a lot of effort and sacrifice and it’s not easy to bal- my boss told me and a personal interview that I had with ance it with work and family. “It involves a lot of time dur- Juan I. Cantarero, I decided to opt for IESE.” ing the week and at weekends but the person closest to me, Carmelo smiles almost nostalgically thinking about the my husband, was very understanding. We approached it first days of the EMBA. “To begin with you feel a bit over- as a joint project.” She spoke to the magazine only a week whelmed and you have a sense of fear and insecurity. When after completing the program and she says that “at an or- you compare yourself with your colleagues you feel you fall ganizational level everything is easier, smoother. “What short. This is perfectly normal, given the high level prevail- I understand is you have to slow down. You have to stop ing in the EMBA.” But these feelings disappeared once he and think, slow down a bit, because you can’t live your life started working in the team. “That’s when you realize how like you have these past two years.” Fuertes has no plans to much working shoulder to shoulder brings you together, leave her company but rather to use what she has learned the solidarity within the team gets you through the tough- to improve it. Her dream is to become a managing direc- est moments, especially in the first trimester.” tor. “Right now I’m very happy at Montana Colors, I know it “One time, I took all the team, including partners, to Val- well and I feel like it’s mine. Later in their career, an execu- ladolid and we had a great time. On another occasion we all tive makes intuitive decisions, because they’ve made a lot offered to help a colleague, practically day and night, to pre- of them, but when you’re young and inexperienced, you’re pare for an oral exam that she alone had to do.” Carmelo not so sure of yourself. Before I did the masters I knew in- emphasizes the solidarity between colleagues which he tuitively if we were following the right course but now I can hopes will last forever. At IESE they put a lot of emphasis on draw up a plan and not simply say that something’s wrong, the continuing relationship. That’s why they say that EM- which is easy to do. If the time comes when I’m not needed, BAs often employ EMBAs because they know what they’ve well, I’ll find something else. If I have a brilliant idea for set- been through.” ting up a business, then I’ll do it. ” “In my case, I’ve benefited almost from the beginning, in management committees, in the meetings with my own Carmelo Asegurado (EMBA ’12) team, in my way of dealing with problems and the way of As he has a degree in engineering from the University of prioritizing and taking better decisions with the informa- lValladolid, Carmelo Asegurado has always worked in tion I have acquired. I would recommend it both for the logistics. “I’ve already worked for five and a half years at El way it opens your mind and because we engineers lack a Corte Inglés where I was working on the internal logistics global vision of the company, such as aspects related to of the online supermarket and everything relating to phone marketing, human resources, accounting and so on. You calls and Internet requests made at elcorteingles.es.”After may have some knowledge of these areas but not how they two years running the supply chain for Opencor and Super- fit into everything from a general management perspec- cor Express, Carmelo’s boss, who is an IESE alumnus, sug- tive, which is exactly what you get at IESE. Furthermore, gested that he do an EMBA. “To begin with I was looking at the more you learn, the more you seek challenges and pro- alternatives but after taking part in the open days, plus what fessional growth.”

60 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE

P E O P L E going out of print William F. Baker believes that the printed newspaper is doomed but what matters for democracy is that we find a new way to pay for quality journalism.

STEPHEN BURGEN

illiam F. Baker began his career neur set up a common pay wall and it seems to be work - in television and was involved ing. He’s now trying to take the model to other coun- in the launch of the Discovery tries. The question is whether countries such as Spain Channel and the Disney Chan- or the U.S. are already too far gone with free, aggregated nel, as well as launching Oprah materials. I think there’s hope that a national pay wall, Winfrey’s career. He is now a or in big countries like the United States, a regional one mediaW academic and is executive in residence at Co- that combines access to local newspapers and local tele- lumbia University Business School, as well as being in- vision might work. volved in the Media and Entertainment AMP at IESE’s New York center. He was in Barcelona for the meeting It’s emerged from the Slovakian model that readers of IESE’s U.S. Advisory Council and took time out to don’t want to be offered segments, they want the speak to the Alumni Magazine about the future of print whole newspaper package. Is this counter-intuitive, media in the digital age. We began by talking about a given that the Internet is all about cherry picking? successful project in Slovakia in which readers pay a I don’t think it’s counter-intuitive. Even though people single subscription fee that gives them access to all of may only use 10 percent of what’s on offer, they don’t the Slovakian press. know which 10 percent they want. They want to cherry pick but they want to make the decisions about what they The Slovakian model seems an obvious solution. read, they don’t want it pre-packaged. The problem is we Could it be applied anywhere? end up only looking at what we care about and this po- Slovakia was below the radar. The major aggregators larizes our societies even more. So a liberal only looks at like Google hadn’t bothered with it because it’s small liberal media and a conservative only looks at conserva- and has a language no one else speaks. So this entrepre- tive media. On the positive side, the Internet has such

62 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE flow, that if someone finds something they’ll email it to tence is critical for global society. Even if they put up a pay me from some source I’d never heard of. wall it would be too small to be economically meaningful.

People identify with great papers such as The New The newspaper business model hasn’t changed in 300 York Times or Le Monde. Do you think people subscribe years. Is the industry a victim of its own complacency to these papers because they see themselves as invest- or did it just not see it coming? ing in something they believe in? We have all been victims of our own complacency. News- I think that’s absolutely true. The things that we read papers have mostly been in monopolies or duopolies, it become an expression of our identity. That’s why these was an easy life and they weren’t focused on the business publications have to be more than a raw source of infor- model. Most publishers in the U.S. were shocked when mation and that’s why aggregators like Yahoo and Google they discovered their newsrooms were being supported are trying to develop their own identity. by classified advertising. And then classifieds went away almost overnight and then they didn’t know how they So far the pay wall has been the only idea for monetiz- were going to pay for the journalists. The people who led ing digital newspapers. Do you think an iTunes sort of those organizations are paying the price because they epiphany might be at hand? haven’t led them properly. But none of us saw this tsunami Firstly, everyone is pretty much agreed that print versions coming. It will all work out, but the real worry is not that of newspapers are going to die. Personally I find that sad, but journalism is going to go away, but how can we make this the goal now is not to save the printing press but to save the transition and still have serious journalism with paid-for newsroom. The real worry isn’t going to be for The New York professionals. And that’s not just a worry for the business, Times, the Washington Post, The Guardian or the Frankfurter it’s a worry for society, because without serious journal- Allgemeine, it will be for smaller papers, papers whose exis- ism we’re not going to have much of a democracy.

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 63 P E O P L E

“I was the least likely person to become an Olympic Champion” Sporting hero Edwin Moses shares

insights with IESE alumni in London. Prof. Antonio Dávila, Edwin Moses and Chris Daniels

here are many ways of look- story of discipline and passion serves as inspiration ing at legends” said Edwin to anyone – either in sport or in business – hoping to Moses, Olympic gold med- achieve greatness. The key, he said, is passion. “There alist and world record break- was nothing on my track and field résumé that said I had ing athlete. “But although a chance. The one thing I had was the passion.” my mother said I was born The similarities between sports and business are ready“ to run,T between being born and later having the striking: both are highly competitive, both are tests street I was born on named after me, I had to do a lot of of endurance, discipline, attitude, performance and hard work”. goals. IESE has its own Center for Sport Business Man- The story of the hard work that made Edwin Moses agement, with various professors dedicated to study- an unparalleled sporting hero is what he shared with ing this phenomenon. If business can learn from sport, IESE alumni in London on March 22. As London is buzz- then there is no career more remarkable than that of the ing with the countdown to the 2012 Olympics, Moses’ track star Edwin Moses.

64 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE “I was born to run but, between being born and having the street i was born on named after me, i had to do a lot of hard work”

to achieve, he said, you have to struggle: “Every day, you have to push yourself against the wall. Every single day.” He reflected on how he would have tears in his eyes as he turned up to the track for practice, knowing what he would have to go through each time. He talked of the protective instinct that the body has, to give up and not go through such tough training. But Moses would push through those barriers each time, to reach what he calls the “twilight zone.” What is the key to overcoming those barriers? Keeping the goals in sight. Moses says his advantage over other athletes was that he was not afraid to feel the pain on a day-to-day basis. To him, it was reasonable, as he knew what the outcome would be: “During my whole career I felt like a gladiator. You don’t have a sword, but you go out with the same mentality.” Having retired from the track, Moses continues to in- Prof. Antonio Dávila, Edwin Moses and Chris Daniels spire with his work for the Laureus Sport for Good Foun- dation. This organization uses sport as a tool for social change, and tackles problems such as HIV/AIDS, child- hood obesity and youth violence across six continents. Before his sporting success, Moses earned a schol- At the event, Chris Daniels (MBA ‘00), President arship to Morehouse College in Atlanta, a university of the U.K. chapter of the IESE Alumni Association, ex- that did not have its own track. Moses, who did not plained what it means to be an Olympic sponsor. Dan- even have decent training shoes, used to train on pub- iels is also in charge of Lloyds Bank’s sponsorship of the lic facilities around town. In 1976, he qualified for three Games - one of the main sponsors of London 2012. Olympic events and went on to win the gold medal in Both Daniels and Moses agreed that London is gear- the 400m hurdles, and set a new world record with his ing up to host a fantastic Olympics in June 2012. time. By 1987, Moses had won 122 consecutive races, set This IESE Alumni Association event took place at Black- the world record three times over and won his second Rock, London, on March 22. IESE Prof.Antonio Dávila gave Olympic gold medal. In 1994, he earned an MBA from the introduction, followed by presentations from Daniels Pepperdine University. and Moses. IESE would like to thank BlackRock and in During an era when many businesses are facing tough particular IESE alumnus Teri Tsuji (MBA ‘02) for their hurdles to overcome, Moses’ message was timely. In order collaboration in this special event.

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 65 P E O P L E China and the EU: Benefits of Bilateral Cooperation Yu Yuantang, division director for European Affairs in the Chinese Ministry of Commerce

n March 9, Yu Yuantang, division China-EU bilateral investment treaty, with agreements director for European Affairs in the to incorporate investment protection, investment pro- Chinese Ministry of Commerce ad- motion and investment liberalization. And of course it dressed an audience of IESE alumni includes some ambiguity, “the best form of protection at the Madrid campus. you can ask for,” he said. Following an introduction from It is important for Europe and China to cooperate ac- DeanO Jordi Canals, Pedro Nueno, Professor of En- cording to Yu Yuantang: “We need to thrash out with trepreneurship at IESE Business School, Executive Europe what we can agree … We need to stay open to President of CEIBS and moderator, announced that Yu each other, stay away from protectionism.” Yuantang had been named an honorary IESE alumnus The EU is China’s largest trading partner and export after his fantastic presentation in Barcelona. market, but only its fourth largest source of foreign In Madrid, the expert in European-Chinese business direct investment, he noted. China represents only 7 and European companies in China focused on enabling percent of the EU’s FDI and the EU only 4 percent of trade and investment cooperation between China and China’s. Compared with EU investments in other ma- the EU, discussing a new bilateral investment treaty and jor economies, this is very low, he pointed out. He also highlighting the progress made at recent political and noted that growth rates in bilateral trade have declined business summits. since last September (bilateral trade grew by only 18.3 Yu Yuantang quipped that, although the Chinese percent last year compared with 31.8 percent in 2010). always say their summits are successful, the political A decline in Chinese exports to Europe is a danger for summit in Beijing in February was particularly fruitful China, he said, stressing that China’s rapid export-led in terms of form and substance. It saw the launch of a growth rate is unsustainable and that it needs to expand

66 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE its services sector looking ahead. But the economic climate in Europe currently is causing a large number of Chinese export companies to suffer heavily. China represents With the bilateral investment treaty, China aims to un- derscore the importance of EU investments in China, he only 7 percent of the said, and its intention is to help address the crisis. “We are also encouraging Chinese companies to invest in Europe.” EU’s FDI and the EU only He stressed that “Chinese companies are not in Europe to loot or deprive you of precious opportunities” but to help 4 percent of China’s. create jobs and drive growth, without subsidizing the investments. Compared with EU Yu Yuantang would like to see increased interaction between Europe and China. He said he welcomes Europe- investments in other an businesspeople to China, highlighting the bureaucratic ease with which they may work and operate there, and major economies, pointed to the need for the Chinese to embrace an inter- this is very low” national outlook. He concluded with his wish that world class business schools might one day set up campuses in China to further interaction between China and the EU, Yu Yuantang to better prepare the Chinese to expand trade in services and better prepare them for a career in Europe.

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 67 P E O P L E what is europe and where is it going? Report on “3-Speed Community”

ince 2008-2009 world trade and indus- john s. reed, trial production has recovered rapidly but chairman of the Europe’s contribution to the recovery has been paltry compared to that of U.S., Asia mit corporation and Latin America, Prof. Xavier Vives told a Continuous Education session titled “Quo Continuous education session VadisS Europa?” on IESE’s Barcelona campus in April. discusses problem of lack The meeting, organized by IESE’s Public-Private Sector Research Center, was also addressed by John S. Reed, of central authority and the chairman of the MIT Corporation, former CEO of Citi- difficulties created by the inability group and former chairman of New York Stock Exchange. to devalue within the Eurozone. Vives discussed the content of the report of the same name published by CESIFO. He noted that, regarding the growth in EU member states, those with flexible exchange rates such as Sweden and Poland are doing much better than the countries in the Eurozone. “How many Europes are there?” he asked, and concluded that there are three. The first includes Germany, Netherlands and Finland; the second Greece and Portugal and, some- where between the two, Spain, France, Italy and Belgium. The origin of Europe’s problems lies in the difference in competitiveness within the euro which the financial crisis threw into relief. Sovereign bonds were all worth much the same a few years ago but the crisis revealed the underlying reality of the various Eurozone economies. The result is that sovereign risk is now linked to bank risks. “The problem is a lack of political credibility and the conflict between the center and the periphery,” Vives said. He pointed to Sweden as a country that has successfully achieved fiscal consolidation and economic growth. As for Spain, he said it needs credible policies and a vision that goes beyond austerity.

68 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE AMERICAN PERSPECTIVE ON THE EUROPEAN SITUATION John S. Reed then went on to offer an American per- lspective on the European situation. “We Americans Americans don’t don’t know what Europe is,” he said. “Who is in charge of the economic situation? Europe appears to be a work know what Europe is. in progress. In the U.S. we have our disagreements but we have one central government and the Federal Re- Who is in charge serve and we know who is in charge.” He said that private finance is wary of Europe and of the economic because the only funds it can count on are from governments and bodies such as the IMF. “Europe needs situation?” time to solve its problems,” he said. “There’s a lot of movement of capital within Europe from weak areas to John S. Reed stronger ones.” Furthermore, elections in different member states don’t necessarily reflect the overall European interest, Reed added, as politicians in each country have to campaign on a national agenda. “We see that Europe says that what happened in Greece can’t happen but it did happen. The values we see are artificial and are based on the flows of capital. In the United States we have an immense deficit but everyone knows who is the govern- Moving on to a discussion of banking regulation, Reed ment. If we need to devalue the dollar we can. We have said the “too big to fail syndrome” is a big problem for all more flexibility.” countries. “There are so few banks now that the discus- He said there are not many examples of making the sion about regulation only takes place among them.” sort of fiscal adjustments that are needed in Europe The crash in the financial sector has led to the de- without being able to adjust the value of the currency. mand that big financial institutions commit themselves “We see the economic problem but the problem of Eu- to being able to sustain bankruptcy without affecting rope’s heritage is even greater. The need for finance is the rest of society. However, he said, it is not clear how greater than that which Europe is capable of producing. this will be applied, adding that the markets now much We don’t see where the money will come from.” more impatient than they used to be.

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 69 P E O P L E sergi quinto (MBA ‘98) the bargain machine Give Customers the Opportunity to Choose Their Own Special Offers

Until Sergi Quinto (MBA ‘98) de- lcided to revolutionize the special deals that brands offer their regular clients, customers were forever asking why there were discounts on products that they never bought nor planned to buy. This system, which was only partially personalized, had come to be seen as a waste of money and opportunities for most advertis- ers. Quinto, who has worked for over 15 years in the mass marketing sector, was concerned about consumers’ negative attitude towards special offer coupons. “Coupons don’t meet consumers’ needs and furthermore they’re inconvenient because they are given at the exit of the store, you can’t use them until the next time you shop and in the meantime many of them are lost or expire.” Quinto had an idea for completely effective mar- Sergi Quinto keting. “Offer the discounts before people shop and give the customer the chance to choose which products they’d like to be on offer that day.” chain in Barcelona. Since then a total FINAVES has played a key role in And so Good Deal was conceived, a ki- of 55 have been installed in branches developing Good Deal. “I presented osk that many customers have come of three supermarket chains – Cap- the project two years ago and they to call the Coupon machine. rabo, Consum and Mas – which have loved it. The support of FINAVES has “There’s no big secret. There’s a received a million visits over the past been fundamental throughout the touch-sensitive screen and a comput- year. The brands pay to be on offer process,” Quinto says, emphasizing er connected to the store’s database in the kiosks. Good Deal’s clients in- the part played by Adelaide Cracco, and which prints out the offers that clude Danone, Unilever, Campofrío, the manager of FINAVES, in design- interest the customer,” Quinto says. Central Lechera Asturiana, Panrico, ing the business plan. “Thanks to FI- The machine is installed at the en- Coca-Cola and Pescanova, among NAVES I reached good agreements trance to the store and the customer others. The Special Offer Machine with investors,” Quinto says. With simply has to insert their card to find only operates in Spain at present but an investment of €830,000 from FI- out what discounts are available. Ac- Quinto says that the plan this year is NAVES, IESE business angels and cording to Quinto, one of the main “to expand in Spain and then look at Caixa Capital Risc was able to go into advantages is “precisely the fact that going international, as well as adding the customer loyalty market offering the offers the client receives are com- some changes to the kiosks’ technol- advantages to distributors, manufac- pletely personalized.” The first kiosk ogy,” including a mobile and web ver- turers and consumers. “I’ve had com- was set up in the summer of 2010 in a sion and adding offers of the stores of plete confidence in them,” Quinto branch of the Caprabo supermarket the neighborhood. says with satisfaction.

70 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE continuous education The Time for Change and Innovation is Now

Nikesh Arora, Google’s Senior Vice President and Chief Business Officer Speaks at IESE.

“When I ask my friends what era lthey would most like to be trans- ported to they tend to say there is no time like now,” Nikesh Arora, senior vice president and chief business officer of Google told his audience at a Continuous Education session at Prof. Philip G. Moscoso and Nikesh Arora IESE’s Madrid campus in April. The session was moderated by IESE’s Philip G. Moscoso, Associate Pro- fessor of Production, Technology the future. But change is unrelenting. of focus that Google has, they would and Operations Management. “The only industry I believe will not do twice as well. Arora described the present as be affected is the mining industry.” In specific regard to Spain, its level of a kind of contemporary industrial He declined to predict his own internet development and the impact revolution. “Surprises have taken company’s revenue sources in five it could have on the current situation, place that we couldn’t have imagined years time. “As long as it’s a lot I don’t Arora perceives that across both large 10 years ago” such as mobile phones, really care where it comes from,” he and small companies Spain is a more digital cameras, the vanishing of video quipped. “I think 95 percent of adver- insular market than many others in Eu- cassettes and much more. Five years tising is still spent elsewhere. I only rope. He believes that the Internet can ago, theIinternet was a strange phe- have 38 of 800 billion of it.” play a significant role because among nomenon, but now it is mainstream Responding to the question of its benefits are that it explicitly leads and a crucial tool for business. If whether Google to expansion beyond someone likes a company and visits will be able to be- local markets. its website but is dissatisfied with the come the new es- “Ten years “Any country where interaction, they won’t go back. “In- tablishment and from now we won’t we have gone in and ternet savvy companies interact bet- at the same time be buying books. worked with small ter with their clients,” he said. remain innova- It’s economics, companies to drive the Revolutionary change is already ap- tive, he said, “We books will go, just adoption of technology parent. “Before we went to HMV to all get risk averse we have seen a percep- buy music or DVDs; we don’t have to and stop learning like DVDs” tible change, whether do that anymore. This has removed as we get older. in reducing costs or $9 between the start of production Companies run the same risk.” reaching more customers.” to delivery.” The same thing is hap- Google’s strategy is to take in in- While understanding the reluc- pening with books. “Ten years from novation, as it did with YouTube tance to invest during periods of low now, we won’t be buying books. It’s and Android, and scale it. The way growth, he pointed out that this is economics, books will go,” he said. to avoid this risk is not to focus on often precisely what successful busi- A nostalgic reluctance to accept this the competition but focus on creat- nesses have done. It is at such times is a real danger for managers because ing a phenomenal product. “Then that “you get the best people at a low having “an emotional condition can everything else falls into place.” He price” and it is talented risk -takers hold you back from being able to an- said this is where Google excels, and who make successful investments ticipate rationally what will happen in if other companies had half the level during periods of slow growth.

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 71 l i f e graduaTION

the class of 2012 united by diversity Dean Jordi Canals believes the MBA and Global Executive classes of 2012, who represent more than 50 countries, present a good picture of the 21st century dwhere people from different cultures and backgrounds are working together to make a positive impact on the world.

72 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE ot so much an end as a new beginning. Yes, it’s graduation time again and students from all over the world completed their studies in the MBA, and Global EMBA programs ready for a new start in their careers. While graduates thanked their families and friends for their forbearance, keynote speakers and faculty members re- Nminded graduates, who hailed from more than 50 countries, that they were among the privileged few and that the time had come to go back into society and put what they had learned to positive effect.

MBA ‘12 After covering more than 800 business cases and 500 ltechnical notes since enrolling in IESE’s MBA program, the class of 2012 finally received their diplomas on May 11, in Barcelona. This year’s graduating MBA class included 270 students from 50 different countries who decided to invest in an MBA during uncertain times and are now heading out into a challenging landscape. Commencement speakers addressed today’s challenges and encouraged graduates to rise above them. Keynote speaker Bruno di Leo, senior vice president of sales and distribution at IBM and proud father of one of this year’s graduates, praised the class of 2012 for their commitment to the program. He encouraged the students, noting that they have proven they are more than ready to embark on “this journey that has only just started.” To be a good leader, he said, you must have three traits: know what you want, how to get there and be committed to your goal, he said. You might have worthy goals and a great action plan, he emphasized, but if you aren’t committed, nothing will be achieved in the end. Most people, according to Di Leo, have the first two traits, but to excel you need all three. “Computers are binary,” he said, “but life always comes in threes: yes, no, and maybe.” So the more you cultivate worthy goals, learn how to achieve them, and commit to them, the better suited you will be to meet the standards of leadership and accountability required in today’s tough times, he said. “The same principle goes for companies: management can define good strategies that suit an organization, but commitment is a matter of leadership, and it’s a big question, because it’s personal. How do you drive commit - ment so an organization will succeed? Setting an example comes first, because people will follow good leaders. Nobody in the organization believe in a strategy if you don’t believe it.” Nobody will follow a model if they don’t see that you can execute it, he said. “It’s not that leaders know a lot,” he said, “it’s that they’re constantly learning. They’re usually humble, and believe others are smarter than they are. If you’re

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There are more good people doing good things than bad people doing bad, but he bad makes more noise”

josé maría garcía-soto

humble, you’ll always see a good opportunity to stay quiet, keeps our ego under control, and makes a persuasive case because that way you learn more.” for the values we stand for.” He said the graduating class Professor Ángel J. Gómez Montoro, rector of the Uni- offered a good picture of the 21st-century business world: versity of Navarra, also appealed to IESE’s 47th MBA class people from different cultures and countries working to- to rise above current macroeconomic figures and headlines, gether and thinking about how to have a positive impact on stressing the importance of not merely trying to be “good,” others. “In today’s global economy, talent is scarce and the but to exercise wisdom. This means being aware of how your role of leaders is key in developing people. We need to cre- decisions affect others, he said. ate professional contexts that respect each person,” he said. Dean Jordi Canals encouraged graduates to focus on And those values will condition your level of happiness respecting others and humility. Only respect, he said, “re- in life, said MBA program director Prof. Pedro Videla, who jects the notion that the business world is a zero-sum game, cited writer David Foster Wallace in order to emphasize

74 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE IF YOU have worthy goals and aN action plan but you’re not committed nothing will come of it”

Bruni Di Leo Senior vice president of sales, IBM that true happiness is a by-product of service to others and involves the often “unsexy” disciplines of attention, awareness, effort and sacrifice. Finally, class representative José María García-Soto urged his fellow graduates to make the world a better place. “My grandfather, the kindest man I ever met, despite the fact that he lived as an orphan the horrors of the Spanish Civil War, used to say, ‘There are far more good people doing good things than bad people doing bad things. The bad just happens to make a lot of noise, while the good usually remains silent’.”

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We have all become a small family, a family that will stand together and support each other when needed

Fernando Garro

GLOBAL EMBA ‘12 active role to push the world forward.” She also asked The 12th Global Executive MBA Class celebrated its them to nurture the global friendship they’ve developed lgraduation ceremony on April 24 after 18 months of with their classmates, a special feature of the Global Ex- coursework at IESE’s global campus in locations ranging ecutive MBA. The 21 students represent a total of 16 dif - from Barcelona to Bangalore. Families and friends from ferent nationalities. all over the world attended the event, as Prof. Sandra The president of the 2012 class, Fernando Garro, Sieber acknowledged in her opening speech, thanking praised the respect for others’ ideas he and his classmates them for the support, patience and care they’ve given the have learned, while quoting a Chinese proverb to describe graduating students throughout the program. the best approach to what lies ahead: “If you want to go Sieber, academic director of the program, reminded fast, go alone. If you want to go far, go together.” He added: the class that the current difficult times call for good, “We have to stay together and not forget that the time we sensitive leaders, and that it’s their turn to “take an have been together has been for a reason, an important rea-

76 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE you should strive to serve your team well”

Julio Rodríguez Executive vice president of world operations, Schneider Electric son. We have all become a small family, a family that will need to develop their talents, and places where they can stand together and support each other when needed.” overcome obstacles, grow and become what they never In his keynote address, Julio Rodríguez (PDG ‘97), ex- dreamed they could be. At the end of the day, leadership ecutive vice president of world operations at the multina- is helping others achieve success, and it doesn’t matter tional Schneider Electric, reminded the graduating class whether they are customers, suppliers or team members.” of qualities that are essential for leaders like them today. Finally, Dean Jordi Canals closed the ceremony, em- “In this global world of ours, any manager who wishes to phasizing the importance of respect as the gateway to “a be successful, regardless of the industry and company size, renewed sense of optimism in the human spirit” that is needs increasingly high doses of leadership or, in other much needed in the business world today. He called for an words, needs to be a leader who makes a daily effort to ongoing contribution and friendship from the graduating better serve his or her team,” he said. “You should strive class, reminding them that “IESE is, and always will be, to serve your teams well. Create the environments they your home.”

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europe’s New Leaders Barcelona hosts AMP Munich graduation ceremony

he graduation ceremo- support. Peter Summo (AMP-Mu- ny for the latest cohort nich ’12), the cohort’s representa- of students from the tive and also vice president of Wack- Advanced Manage- er Chieme, highlighted the tools ment Program (AMP) acquired during the course and also Munich was held on the ethical perspective the students IESE’sT Barcelona campus on March had acquired. Peter Sive (AMP-Mu- 9. Some 20 executives from eight nich ’12), the second representative countries completed the program and managing director of Catalysis, that was initiated by IESE in 2005. thanked his fellow students for their The academic director is Prof. Marc efforts and praised the professors. Sachon. The countries represented The ceremony was wound up by were Germany, Slovenia, Hungary, Dean Jordi Canals who gave a talk Austria, Turkey, the U.K. and Spain. on the “Culture of learning and the Rudolf Repgen, the program role of virtues.” director, said the students had suc- The students’ commitment to IESE cessfully completed their studies was reflected in the fact that 80 percent and thanked their families for their of them joined the Alumni Association.

78 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE putting on the polish executives from wide range of backgrounds graduate from sixth amp warsaw

articipants in the 2012 at a time of rapid change. It begins class of the AMP War- with a one-week residential module saw received their in Barcelona while the main sessions diplomas on April 27 are held in Warsaw, followed by a final on IESE’s Barcelona module and graduation in Barcelona. campus. The class was The AMP Warsaw covers essential Pmade up of a wide range of profession- topics of general management and als from sectors as varied as finance, helps executives to reach a better insurance, information technology, understanding of economic trends sales and public administration. while honing their leadership skills. The program, which is led by Rado- Participants are senior executives slaw Koszewski and academic direc- with at least seven years experience tors, Lluís G. Renart and Javier San- in positions such as chief executive, toma, is in its sixth year. It is designed managing director or vice president to meet the needs of Polish companies and have an average age of 44.

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 79 l i f e the eastern horizon dean visits japan one year on from tsunami

ean Jordi The current financial crisis has tions that have been pursued. He Canals macroeconomic roots, Canals said, talked about the changing concept began his but it also reflects a deep leadership of leadership and the need to be tour of Asia, and governance crisis in some large courageous and develop credibility. where there companies. Macro policies and are now 240 corporate governance reforms are german leadership of IESE alumni, needed but they will not stimulate europe’s difficulties in Tokyo entrepreneurship, innovation or During a question and answer where he arrived on March 11, one year corporate growth. Leaders need to lsession in Hong Kong, Ca- Don from the devastating earthquake build the reputation of their firms, nals was asked how he felt about and tsunami which left thousands dead create a sense of purpose among Germany taking on the role of Eu- and triggered the worst nuclear crisis employees, engage allies in order rope’s savior. He said that Gerhard since the Chernobyl meltdown in 1986. to create solidarity, lead by ex- Schröder’s reforms had helped to Canals expressed his condolences as ample and base their decisions on make Germany strong but that An- well as his admiration for the fortitude ethical values. gela Merkel, the German chancel- of the Japanese people in dealing with lor, needed to be more decisive and the disaster. next stop china to work more closely with her Euro- The next stop on the tour was pean allies, but she also had an elec- macro roots of crisis lShanghai, where some 50 alum- tion to win. “Europe needs to lead The following day he gave a ni and friends met for a Continuous by example,” he said. “The outlook ltalk at the offices of JX Hold- Education session held at the Lujia- is still gloomy but the foundations ings Inc. titled “Some leadership zui International Finance Research are being laid for a brighter future.” lessons from the U.S. and Europe’s Center at the China Europe Interna- The last stop on the tour was at the financial crisis.” The session was tional Business School (CEIBS). The NUS Business School in Singapore hosted by the Japan Chapter, whose session was chaired by Prof. Rama where, together with Dean Ber- president is Kenji Tomino (MBA Velamuri, who teaches entrepre- nard Yeung, Canals addressed an ‘08). It was attended by some 30 neurship and negotiation at CEIBS. audience of some 60 alumni and alumni and around 40 guests from Canals emphasized the need to find other invited guests. Both deans leading companies and organiza- solutions to the crisis and went on shared their views on leadership, tions based in Japan. There are cur- to compare the different impact while Yeung gave a talk titled rently 41 Japanese students study- of the crisis on the United States “The Asian growth model and ing on IESE’s Barcelona campus. and Europe, and the different solu- Asia’s challenges.”

80 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE HONG KONG TOKYO

SINGAPORE SHANGHAI

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 81 l i f e steadfast supporters 25th annual meeting of sponsoring companies, chairs and research centers

Despite the straitened economic times Group Chair and then briefly reviewed the current eco- we live in, many companies continue nomic situation and outlook and called for “hope.” He was followed by IESE Prof. Juan J. Toribio who to give IESE their support while others led the conference titled “Necessary Reforms” in which are backing the school for the first he said that economic recovery depends on increasing both productivity and competitiveness. time. During the annual meeting, Dean Jordi Canals thanked them all for their keys to being competitive invaluable contribution. He cited a series of factors, policies and institutions l that are crucial for creating competitiveness, according to the World Economic Forum’s Global Competitive- ness Index: the quality of institutions, the quality of in- ean Jordi Canals opened the 25th An- frastructures, a healthy macroeconomic climate, primary nual Meeting of IESE Sponsoring Com- education and public health. He also listed the efficiency panies, Chairs and Research Centers of stock markets, the labor market, the development of on May 24 in Barcelona. He told the the financial market, a readiness to accept new technolo- meeting that “we learn a lot from your gies, the size of the market and the quality of companies. comments and suggestions.” He also The meeting ended with a talk by Prof. Josep Valor thankedD the sponsoring companies for “continuing to on “Social Networks and Business” in which he ana- support IESE in spite of the difficulties of the Spanish lyzed the role of social networks, and Facebook in par - economy and the companies that work in it.” ticular, and their implications for business. “Techno- He then went on to present new sponsors whom he logical change brings social change,” he said. “Society described as “friends and the inspiration behind many is adopting technology and business trails behind.” He of IESE’s projects:” Altair Management Consultants, also warned of the danger of not knowing how to man- Coaliment Granollers, the Wine Division of Moët & age technology overload. “It would be a grave error not Hennessy Estates and Wines, GFT Group, Grupo Lo- to carry out in-house studies on technology use to en- gista, Kellogg’s Spain, Mango, Mutua Madrileña and sure greater efficiency and avoid a collapse of the infor - Swarovski. He also presented the new Eurest, Compass mation systems.”

82 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE 1 2

3 4 5

1. Tomás Pascual and Javier Colomina, CEO and CFO of Grupo Leche Pascual, respectively and Carlos Molina, president and CEO of Arteoliva. 2. Domingo Arochena, head of Promotora Imperial and Enrique Sendagorta, founder and honorary president of Sener. 3. José Felipe Bertrán de Caralt, managing director of the Fundación Bertrán. 4. Juan-Miguel Villar,managing director of Grupo Villar-Mir, with Prof. Jordi Canals. 5. Juan Gervás, managing director of Mahou-San Miguel and Ramón Agenjo, executive of Damm.

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6 7

8 9

10 11

12 13

6. Mauricio García de Quevedo, CEO of Kellogg’s Spain. 7. Juan Ramón Lozano,managing director of Bodegas Lozano, with his daughter Ágata and Natalia Centenera (IESE). 8. Emilio Cuatrecasas, partner and managing director Cuatrecasas Abogados, with Jaime Alonso (IESE). 9. Enrique Valer, country president of Schneider Electric in Spain, Portugal and South America with Marcos de Pedro, managing director Europe, Middle East and Africa for Neoris. 10. Mar Raventós, president of Grupo Codorniu. 11. Prof. Francisco Iniesta (IESE) and Enric Casi, managing director of Mango. 12. Tomás Tomeo (IESE) and Alfredo Ruiz-Plaza, managing director of Compass Group Spain. 13. Antonio Garrigues, managing director of Garrigues Abogados, and Jaime Alonso (IESE).

84 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE BP GAS NATURAL FENOSA JOHN DEERE RICOH IESE’s CAIXABANK GENERAL CABLE JOHNSON CONTROLS ROCA sponsoring CAMBRA DE BARCELONA GENERAL ÓPTICA KELLOGG ESPAÑA ROCHE companies CAPIO SANIDAD GFT IBERIA SOLUTIONS KONSAC ROLAND BERGER CAPRABO GINMOVIAN KPMG SABA CATALUNYACAIXA GRUP CATALANA OCCIDENT LABORATORIOS LETI SAGARDOY ABOGADOS ABERTIS CEMENTOS MOLINS GRUPO ARICAM LEAR CORPORATION SANITAS ACCENTURE CITI GRUPO BANCO POPULAR LENER SANOFI AVENTIS ACCESO GROUP COALIMENT GRANOLLERS GRUPO BARCELÓ LOGISTA SCHNEIDER ELECTRIC ADECCO TT COMSA EMTE GRUPO CELSA MANGO SDL-TRIDION ADP CORPORACIÓN ASESORA GRUPO CODORNÍU MARTINSA-FADESA SEAT AENA COVAP GRUPO DAMM MECALUX SENER INGENIERÍA Y AF STEELCASE CRÈDIT ANDORRA GRUPO ELOSA MERCAPITAL SISTEMAS AGBAR CUATRECASAS GRUPO ESTEVE MERQUINSA SEUR AGROLIMEN DANONE GRUPO GESTESA MICRO-BLANC SIEMENS AIRBUS MILITARY DELOITTE GRUPO LECHE PASCUAL MIQUEL Y COSTAS & SIKA AIR LIQUIDE MEDICINAL DEUTSCHE BANK GRUPO MAHOU-SAN MIQUEL SOCIAL TRENDS INSTITUTE ALCATEL DIAGEO MIGUEL MULTIASISTENCIA SOLVAY ALHAMBRA-EIDOS DKV GRUPO NOVARTIS MUTUA MADRILEÑA SONY ALLIANZ ENAGÁS GRUPO PARERA NEGOCENTER STAIG GRUPO ALPHABET ESPAÑA ENDESA GRUPO PUIG NEORIS INMOBILIARIO ALTAIR MANAGEMENT EPSON GRUPO SANTANDER NESTLÉ SWAROVSKI CONSULTANTS ERES RELOCATION GRUPO TELEFÓNICA NEXTRET SYNTHESIA ESPAÑOLA ARBORA & AUSONIA ERICSSON GRUPO VILLAR MIR NISSAN TALDE VENTURE ARDANUY INGENIERIA ERMENEGILDO ZEGNA GUINEU PALEX MEDICAL CAPITAL ÁREAS ERNST & YOUNG HENKEL PANRICO TANDBERG ARTEOLIVA ESPÍRITO SANTO HEWLETT PACKARD PENTEO ICT ANALYST TECHNO TRENDS ASCENSORES ERSCE INVESTMENT HUERTA DEL CARMEN PEOPLEMATTERS TETRA PAK ASEPEYO ESTATES & WINES IBERDROLA PHILIP MORRIS TEXSA A.T. KEARNEY EUREST IBM PLÁSTICOS TA-TAY THE ROYAL BANK OF ATRIAN EVERIS ICL PORTAVENTURA SCOTLAND AYESA ENGINEERING EXPERIAN IDOM PORT DE BARCELONA TOUS BACARDÍ FICOSA INTERNATIONAL IMS HEALTH PPG TOWERS WATSON BALAGUER-MORERA & FMC FORET INDRA PROSEGUR URALITA ASOCIADOS FOSTER WHEELER INFORPRESS PWC VALINSA BANC SABADELL FUNDACIÓN BERTRÁN IN2 RANDSTAD VESTAS BANKINTER FUNDACIÓN HORIZONTE XXII INLANDGEO RAY HUMAN CAPITAL VOCENTO BARCLAYS FUNDACION Mª. FRANCISCA INTERMAS NETS RED ELÉCTRICA DE ESPAÑA WILLIS BASF DE ROVIRALTA INVERSIONES SINFIN REDUR WÜRTH BBDO FUNDACIÓN RAMÓN HOLDING REPSOL YPF ZANINI AUTO GRUP BBK ARECES ISS FACILITY SERVICES REUTERS ZARDOYA OTIS BBVA GARRIGUES IZASA REYAL URBIS ZURICH

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 85 l i f e Bloomberg, Bowles and Simpson Breaking the U.S. Budget Stalemate

The Wall Street Journal Viewpoints Executive Breakfast Series Co-sponsored by IESE and BCG.

ver the last de- Erskine Bowles, former chief of The main value ofSimpson-Bowles cade, the U.S. staff under the Clinton administra- is that it is “thoughtful” and sets priori- federal gov- tion, and Alan Simpson, former ties for the entire country, rather than ernment’s state senator of Wyoming. Bowles seeking to protect special interests, revenue has and Simpson are the authors of a key Bloomberg said. increased by framework for cutting spending and Bloomberg also said the plan marks 15 percent, raising taxes. a “unique” moment when the presi- while ex- Simpson, a Republican, and dent has the power to make key, yet penses have risen by 80 percent. Bowles, a Democrat, discussed rea- gradual, changes in unfunded man- O“You just can’t keep doing this,” sons why the plan has failed to draw dates such as Social Security, Medicare said New York City Mayor Michael support from the President and legis- and Medicaid. “The president should Bloomberg, who discussed his sup- lators. In March, the proposal was de- stand up and say we’re all in this to- port for letting the Bush-era tax cuts feated in the House 382-38, with just 16 gether,” he said. expire during a Wall Street Journal Ex- Republicans and 22 Democrats voting The Bush-era tax cuts, which are set ecutive Viewpoints panel discussion, in favor of it. to expire in December 2012, should be co-sponsored by IESE Business School President Obama did not support ended for all income groups, he said. and BCG on March 29. the plan in order to avoid becoming Raising taxes only for the rich will not The discussion, led by the WSJ embroiled in controversy during an be enough to solve the revenue prob- Editor Alan Murray, also featured election year, Simpson said. lems the country currently faces. In-

86 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE Michael Bloomberg

Alan Simpson

Erskine Bowles stead the cuts should be allowed to Bowles, who helped negotiate the what it takes to balance the budget if expire and any tax hikes should be ap- balancing of the U.S. budget in 1996 re-elected. plied to everyone. This would resolve under President Clinton, said that The U.S. faces a predictable but the problem of revenue, so expenses levels of trust and confidence must avoidable crisis, he said, and the pros- could then be gradually reduced. rise among U.S. politicians before an pect of chaos will eventually precipi- “The president has the power to agreement on how to balance the bud- tate action among U.S. legislators. really run roughshod, if you will, get can be reached. He also said that he Although Simpson-Bowles has over Congress. Normally, he does believes that President Obama will do been criticized for not providing suf- not,” he said. ficiently in areas such as education, Murray noted that there are a num- infrastructure and meeting the needs ber of aspects of Simpson-Bowles of an aging population, Bowles said, “I that would have a significant impact The President has think we can prove beyond a shadow of on New York City because it is a high- the power to really a doubt that it is enough.” income state. For example, he said, the run roughshod, For Bowles-Simpson to be effec- plan could limit mortgage interest if you will, over tive, however, lawmakers will have to on large homes worth more than Congress. Normally make tough decisions regarding cuts, $500,000 and capital gains could dis- he does not” he said. “The problems are real and appear entirely, adding that “New York the solutions are all painful. There is City is the capital of capital gains.” no easy way out and everything has to be on the table.”

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Amsterdam FRANKFURT BRUSSELS mUnich TORONTO LEUVEN OLPE nEW york londON COLOGNE

parIs WARSAW TOKyO SAN FRANCISCO miami ZURICH SHANGHAI LISBON DUBAI MEXICO CITY HONG KONG

LIMA

SÃO PAULO

SANTIAGO DE CHILE

The Latest on IESE’s Alumni Chapters chapter news

ña titled “Why the economic crisis is dividual roles during the production Cologne different in Europe.” The meeting was can affect the team’s performance. March 1 held in the BCI auditorium in Santiago. April 12 Prof. Adrian Done led a session lon “Global Trends” in Cologne Warsaw The Poland Chapter held a based on his book Global Trends: March 1 lsession presented by Dariusz Facing Up to a Changing World. He Stolarczyk (AMP-Warsaw ‘10) on discussed some of the trends and The Polish capital hosted a “Empik Digital – Development strat- challenges we are likely to face in the lContinuous Education session on egy overview.” Stolarczyk is COO coming decades. The Chapter thanks “Fostering Creativity – Lessons from and board member of NFI Empik Oliver Schoen (MBA ‘05) and Cap- Motion Pictures” given by Kandarp Media & Fashion and managing direc- gemini & Consulting for their help in Mehta, a member of IESE’s scientific tor of Empik Digital. organizing the event. staff. The discussion centered on creativity in teams. Two trends that have Zurich Santiago de Chile emerged in the current economic context are the need for new ideas and March 2 May 3 the growing importance of the team. Mehta talked about what The Switzerland Chapter held Chile alumni met in the capital for he had learnt from working in teams ltheir traditional working break- la talk by Prof. Antonio Argando- on film shoots and how changes in in- fast in the capital.

88 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE www.facebook.com/alumni.iese www.twitter.com/iesealumni

March 22

Zurich hosted a talk given by lProf. Javier Estrada titled “Blinded by Growth” in which he discussed growth from the perspective of economics and profitability and how these relate to investors’ returns. Evidence 1 shows that it is perfectly possible to get low returns in a high growth environment and vice-versa. Mexico City March 8

Prof. Javier Estrada joined lmembers of the Mexico Chap- ter for a breakfast talk in which the professor addressed the topic “Investing in emerging markets: 2 the current situation and outlook for the future.” He was 1. Amsterdam 2. Paris accompanied by Begoña de Ros, director of the SEP New York- Miami program. Miami May 8 March 27 Members of the United States Monterrey lChapter met in New York for the March 9 Difficult as it is, failure is part session “Dangerous Connections: lof life and executives have to Hedge Funds, Brokers and the Emer- After visitng the capital, learn to live with it. This was the gence of a Consensus Trade” given by lProf. Javier Estrada went gist of the talk “Learning to face Prof. Jan Simon who talked about the on to Monterrey to take part in a failure” given by Santiago Álvarez structures and social practices of hedge breakfast discussion on “Investing de Mon to alumni in Miami. funds and how they make decisions. in emerging markets: the current situation and outlook” which was held at the headquaerters New York Amsterdam of Heineken in the city. The March 27 March 29 professor was accompanied by Begoña de Ros. Prof. José L. Nueno gave a talk Amsterdam hosted the Con- l“The Consumer of the Future” ltinuous Education session at IESE’s center in Manhattan. “World 3.0: Global prosperity and Leuven He discussed the emergence of a how to achieve it,” based on Prof. March 16 global middle class made up of a Pankaj Ghemawat’s celebrated declining industrial middle class book World 3.0. The session “Innovation on the one hand and on the other land Entrepreneurship in a billion consumers in emerging Flanders” brought together a economies. Lisbon panel of Flemish entrepreneurs March 29 led by Eric Van Zele, CEO of May 3 Barco, who discussed entrepre- Portuguese alumni held their tra- neurial initiatives in the Flanders Prof Marta Elvira gave a lditional dinner discussion under area. The meeting ended with the lsession titled “Flexibility & the heading “Como surgiu e opera a presentation of a case study by Sustainable Workplaces” at IESE’s Estrutura de Seguimento do Memo- Prof. Bruno Cassiman. New York center. rando de Entendimento (ESAME)”.

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 89 l i f e

The dinner was attended by Carlos organized jointly for the first time with decisions and ignores the organiza- Moedas, the deputy prime minister, the London Business School and was tional and social aspects of decision who is responsible for ESAME which attended by Prof. Rob Johnson. The making. Focusing on hedge funds, the was established by the government Chapter is organizing a series of quar- professor talked about their struc- to oversee the adjustment of the terly breakfasts with entrepreneurs. tures and social practices and how Portuguese economy demanded they make decisions. by the European Commission, the Paris European Central Bank and the Olpe International Monetary Fund. April 18 April 25 Tokyo Prof. Yih-teen Lee presented the lconference “Cross-cultural con- Prof. Christoph Zott addressed April 4 nection in a virtual world” in which he lGerman alumni on “How to Build used the case of “Greg James” to dis- a Billion-Dollar Company.” Using The conference “Trends, cuss the challenges virtual teams face concrete cases, the professor tried lchallenges and opportunities” and the skills needed to overcome the to explain the secret of the success presented by Prof. Jan Oosterveld cultural and geographical obstacles to of start-ups that managed to grow to was held at the Spanish embassy in international virtual collaboration. become global companies. Tokyo. The professor discussed current trends and their implication for management, innovation, education Toronto Brussels and public and personal policy. April 19 May 7 London Toronto was the venue for a The session “Platform Competi- lContinuous Education session ltion” was led by Prof. Govert April 18 “Dangerous Connections: Hedge Vroom who discussed strategic and Funds, Brokers and the Emergence brand concepts relevant to network London alumni held an Entrepre- of a Consensus Trade” given by Prof. markets such as doing business lneurs Breakfast Meeting “Started Jan Simon. Economic theory centers online, as well as phenomena such Up: Works in Progress” which was on the potential results of investment as winner-takes-all markets, critical mass and the competence of plat- forms. As markets become increasingly inter-connected, success depends on complementing established approaches with new strategies. Munich May 7

The German Chapter met in Mu- lnich where Prof. Franz Heukamp April 18 was accompanied by Siegfried Russ- SÃO PAULO wurm, board member and CEO of Sie- ISE Business School in Brazil we want to build.” This phrase mens Industrial Sector, who recounted lwas the venue for celebrations was the basis of a discussion of his experiences as an innovative leader marking 10 years of the AMP Brazil. the values and attitudes that in uncertain economic times. The keynote speaker was Fábio must inform business decisions Barbosa, president of Abril, who tain order to create a fairer and lked about how the companies and more just society. “Brazil will be San Francisco society we create are an expression what we make of it… each one of our personal attitudes. Barbosa of us, through our actions and May 8 has headed major banks (Real/ABN omissions.” The event was also y Santander de Brasil) from 1996 attended by the director general United States alumni met in to 2011 and also presided over the of IESE, Paulo Roberto Ferrei- lSan Francisco for the session “A Federación Brasileña de Bancos ra, and César Beltrán, director (FEBRABAN) from 2007 to 2011. of ISE in Brazil and director of new Challenge for Leadership. A He talked about the Brazil “that executive education. Changing Skillset” given by Prof. Paddy Miller.

90 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE www.facebook.com/alumni.iese www.twitter.com/iesealumni

______PDD-I-74 YOU’RE IN Salvador Alemany, CEO of Abertis is the new president THE NEWS of the social council of the Universitat de Barcelona (UB). ARE YOU IN THE NEWS? ______We are interested in all your latest news. PDD-1-09 Send your comments to [email protected] Enric Parera is the new managing director of ______ToolsGroup. EMBA ‘06 ______Gerhard Sturm PDD-A-10 is the new president Carlos Sáez has been appointed of central Europe head of business development 2012 Spring for Sony Mobile. at Georgeson. ______PDD-E-05 Games: ______Leroy Merlin has appointed MBA ‘81 Rafael Burgos as head of The Business logistics. José Antonio Garvía has been ______appointed sales director for Kia Motors Iberia. PDD-D-06 of Fun ______Sabrina Tahiri has been named MBA ‘84 as marketing director of Prisa l For some they are simply a matter Dirk Kremer, director and partner Noticias which publishes of fun and games, for others more like at Q Management of Transition, has newspapers such as El País, As and Cinco Días. managing a small company. IESE’s MBA been named as The Netherlands ______honorary consul in Barcelona. Spring Games have grown in scope and ______PDD-D-07 participation this year. MBA ‘86 Joaquín Olivares is the new Some 850 students from eight business Ángel Herrero has been marketing director for western schools (LBS, Bocconi, INSEAD, HEC, Europe for the Latin Rums appointed as director of ESADE, EADE, IEE, and IESE) enjoyed Canal IT at Samsung. division of Diageo. ______a weekend of tournaments in sports, MBA ‘88 PDG-I-00 ranging from traditional football or María Río has joined Gilead Bluemap Consulting volleyball to unconventional ones like as managing director of Gilead Group has named dodgeball or petanque. The event was Sciences in Spain. Josep Mensa as a ______partner and director. held April 20-22 in Barcelona. MBA ‘91 This year’s games boasted more of an international flavor than past years, Iñaki Basterreche has been ______promoted to managing director with students flying in from business for southern Europe at the Royal PDG-B-07 schools in London, Milan, Fontaine- David Martínez is the new head Bank of Scotland, which he joined bleu and Paris, as well as a new in 2004. of marketing at Metro Cash & ______Carry Germany. location: the beach. Thus, beach vol- MBA ‘09 leyball, football and ultimate frisbee Pau Sansa has were added to the potpourri of games been named as ENTREPRENEUR for the first time, as well as the 2012 managing director of regatta, which ended up taking center Hidroglobal, a company that EMBA ‘09 stage on the first day, according to is part of the Beatriz Cardona is developing student organizer Marcelo Montilla. MAT Holding group. Tripku, a social application for Montilla summed up his experience as ______adventure holidaymakers who organizer in terms of practical training want to make up groups with PADE-II-00 ground for concepts learned in class. Rafael Fernández has been other travellers, design their appointed managing director of holidays jointly and receive “Organizing the Spring Games is like Zardoya Otis. special offers from tour running a small company,” he said. ______operators. Tripku was chosen “Our team of 30 people, divided into PADE-A-06 as part of the third Startup seven different departments, spent Chile program, an international Bernardo Fernández has been months coordinating the event. It’s named as CEO of Zardoya Otis. entrepreneur program. provided great practice for the real business world.”

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the return of the mbas More than 430 alumni from all over the world converged on barcelona to meet up with former classmates and professors

istance is no ob- Jordi Canals, the dean of IESE, Alumni Association, who thanked sacle when it welcomed the members of the all of the alumni who had come comes to taking seven cohorts and thanked them from far away to attend the reunion. part in an IESE for returning to IESE. He was fol- school reunion. lowed by Prof. Pedro Videla, and back to class This was clear Mireia Rius, the director of the Finally, professors Antonio Ar- whenD alumni representing almost lgandoña, Carlos Cavallé, Brian 25 nationalities met on the Bar - Leggett, José Antonio Segarra, celona campus on May 26 as part MBA cohorts Jorge Soley, Julián Villanueva and of a series of five-yearly meetings. spanning 30 Pedro Videla led a series of academic More than 430 alumni from years and sessions that took the visitors back to the classes of MBA ’77, MBA ’82, representing the days spent in the classroom. The MBA ’87, MBA ’92, MBA ’97, MBA 25 nationalities sessions coverd topics such as the cur- ’02 and MBA ’07 took part in the rent economic situation, the relative event along with friends and fam- reunited security of savings in Spanish banks, ily and their former professors. new media and the future of the euro.

92 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 93 l i f e

bracing for uncertainty siemens industry ceo offers some sound advice on the challenges of being an effective leader in uncertain times

n May IESE Business should CEOs delegate this job to company, you should make sure School hosted an event their HR departments: ”As a lea- that it is attractive for them.” in Munich with Prof. der, you should ask yourself if you Prof. Heukamp, who is IESE’s Siegfried Russwurm, have someone on your team that secretary general, pointed out the Siemens’ CEO of the In- you would be willing to work for.” necessity of an ethically-oriented dustry Sector, who is also True leaders require little hierar- management culture, which is an a member of IESE’s International chy, if any, he said. Above all, they important focus of IESE’s executi- AdvisoryI Board. In the session, led create a corporate culture that re- ve education programs worldwide. by IESE Prof. Franz Heukamp, lies on values rather than rules to Studies have shown that people he discussed the topic of effective motivate employees. “If you want have lost confidence in authority. “We leadership in times of uncertainty. to attract the best talent to your have to make sure that they regain their In a crisis, Russwurm said, it is trust in business leaders,” he said. important to act decisively and not When asked about the economic just react to events. This, however, challenges faced by central Europe, is an ability that should be fostered “To attract the Russwurm said the region’s unpar- and nurtured over long periods best talent to your alleled ability to deal with complex of time. company you have problems so far made him quite op- The paramount job of a CEO to make sure timistic about its future. In order to should therefore be to ensure that it’s attractive prepare for uncertain times ahead, there is a steady stream of young for them.” he advised leaders in the audience leaders entering the company over to “imagine the craziest scenario time. Under no circumstances and prepare for it.”

94 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE The Netherlands in World 3.0 alumni gather in amsterdam for a talk on globalization by pankaj ghemawat

ore than 120 tijn Eikelenboom (MBA ‘88), Bouke IESE alumni and Marsman (MBA ‘04), Barbara Rud- guests from the ing (MBA ‘04), Felix van der Sommen business commu- (MBA ‘10), Astrid Odile de Visser nity attended the (MBA ‘90), and Alexander Wouterse special Alumni & (MBA ‘89). FriendsM event held in Amsterdam with The Netherlands Chapter Board Prof. Pankaj Ghemawat on March 29. team was instrumental in making this The event was held at the prestigious event a success. They provided support Amstel Hotel where Jan Oosterveld, in the planning phase, as well as in pro- senior lecturer in entrepreneurship at moting the event to VIP guests from IESE, as well as founder of the Nether- the Dutch business community from lands Alumni Chapter, welcomed the their own professional networks, thus select group of attendants and intro- leveraging this great opportunity to duced Ghemawat, who then shared his create visibility in one of the key mar- views on Globalization, as presented in kets for IESE. his new book, World 3.0. Het Financieele Dagblad, one of the The Netherlands Alumni Chapter main financial publications, published was established in May 1990, the first an interview with Ghemawat. The in- Alumni Chapter to be created in Eu- terview, as well as more photographs, rope outside Spain. With close to 200 can be found in the Netherlands Chap- alumni in the Chapter, current presi- ter website on the Alumni site. dent Philip Alberdingk Thijm (MBA Sincere congratulations and thanks ‘89) heads the Chapter Board team to the Netherlands Alumni Chapter on which includes: Benito Diego, Mar- behalf of the IESE community.

IESE Alumni Magazine JULY-SEPTEMBER 2012 / no. 126 95 l a s t o wr oi r d “To do”

Josep Tàpies Professor of General Management and Chair of Family Business at IESE

he verb “to do” is one of the most It is important to do things professionally, versatile and nuanced in our to the best of one’s abilities, always trying to language. It is an active verb that improve and, of course, to get results. transforms ideas into concrete Teaching to do means helping people realities, an entrepreneurial verb realize their potential. A good executive helps that we associate with creating new things. his or her team members to develop, explains And it is an especially important verb for the rationale behind decisions and listens to businessT people whose job it is to imagine and and helps them. This is the only way to create the future. conquer the fear that stops people from At a recent conference on the Barcelona learning and improving. campus a well-known business person and Getting on with doing is the essence of the IESE alumnus, reminded me of the richness executive’s job. It’s not a matter of giving orders of this verb when he said, “There are five but of getting people to do what is required important stages in life: learning, doing, of their own free will. Communication and teaching how to do, getting on with doing and, persuasion are essential in order to achieve this. finally, stopping doing.” Experience teaches us that the hardest thing Learning to do involves the responsibility of is stopping doing. It’s not easy to retire. It’s everyone to study before taking up a position a tough decision to let others get on with the in a company. This is especially true in a family job and, although it’s clear that the verb cycle business in which each member of the family must begin anew, it’s exactly at this stage that must be free to learn according to their vocation, we encounter the first obstacle. This is when their abilities and their personal convictions. the business person’s real intentions are Family businesses also offer another form of revealed: do they really see the company as more apprenticeship, as the next generation grows up important than themselves or do they think, within the company. “après moi le deluge?”

96 JULY-SEPTEMBER 2012 / no. 126 Alumni Magazine IESE Proyecto3 15/4/09 16:29 Página 2

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