fall 2006 Get -powered

In today’s hotly competitive global business environment, high-quality management education can be a critical advantage on the successful executive’s career path.

At the Stephen M. Ross School of Business at the University of Michigan, we believe that business education is an ongoing, lifelong experience that not only gives executives a strong foundation to begin their careers, but also refreshes their business knowledge and re-energizes their performance at critical points in their business lives.

Executive MBA Executive Education

■ Results-oriented Curriculum ■ Real-world Approach Michigan EMBAs apply what is taught to solve real-life business problems. Michigan's Exec Ed solutions are comprehensive, innovative and mirror the multidisciplinary nature of today's business challenges. ■ Professional Development EMBAs gain the next-level skills required to advance careers. ■ Rich Portfolio of Services Includes open-enrollment and custom programs, consulting, Speakers ■ On-campus and Online Monthly Format Bureau, M-Coach and more. Michigan provides a world-class MBA with once-per-month Friday/Saturday residencies. ■ Global Commitment Michigan reaches across the globe with more venues, an extensive Info Sessions » Ann Arbor, Michigan catalog of management competencies and several Centers of Excellence i September 16, 2006 | October 21, 2006 | November 15, 2006 dedicated to global issues, Michigan is uniquely equipped to meet Classes begin January or August each year. organizational and executive development needs around the world.

www.emba.bus.umich.edu www.execed.bus.umich.edu CONTENTS FEATURES

26 What We Talk 36 From Spin Cycle About When to Baby Formula We Talk About International action-based projects are one way Ross Globalization School MBA students Free trade has created interlocking, sharpen their business skills. interdependent economies in which Learn what happens when countries increasingly specialize MAP teams go to Romania in what they do best. Learn more and Rwanda. about the risks and rewards of globalization for countries, fi rms and individuals. 41 Early Women MBA Students Ushered 18 Joel Tauber: in a New Era A Balanced Life Having just won the right to vote, the Ross School’s fi rst As a young man, Joel Tauber women students were eager developed a personal plan for to test the limits of women’s success. Discover how that strategy newfound freedoms in the still guides this Ross School alum. 1920s. Learn about the careers and lives of these pioneers. 21 TMI: Building Leaders in Global Operations INTELLECTUAL Established in 1993 to boost CAPITAL American manufacturing, Tauber Manufacturing Institute prepares business and engineering students 8 Achieving the to excel in all aspects of operations management and manufacturing Extraordinary: Cleaning strategy. Up a Nuclear Nightmare In his new book, Kim 32 Inside the Beltway: Cameron tells the story of Rocky Flats, Nevada, Carson Scholars a top-secret site that once housed more radioactive Explore Government, waste than any other Business Links nuclear weapons facility in the United States. Th e Washington Campus’ new BBA program fosters understanding of the federal government’s decision- making process and how those decisions infl uence business.

dividend 1 fall 2006 CONTENTS DEPARTMENTS

3 Across the Board 16 Alumni at Large Dean: Robert J. Dolan Director of Marketing Communications: Ross School students Managing HR in Paul Gediman fi re up for Mad Money … Accounting Club a Multicultural Executive Editor: Mary Jo Frank turns teens on to busi- World Class Notes and Copy Editor: Fred P. Wessells ness … National Geo- Cynthia Tragge- Designer: Michigan Marketing & Design graphic Society CEO Lakra, MBA ’93, John Fahey’s window Photographers: Mary Butkus, Eileen Colton, MA ’93, senior vice Philip Dattilo, Scott Galvin, Steve Kuzma, Andy on the world … busi- president of GE Consumer Finance, Sacks, Ashesh Shah, Heather Th orne, Martin Vloet ness leaders share insights at Dean’s leads the company’s strategy on Seminars … kudos to Professors Printer: University Lithoprinters labor and communication issues Alfred Edwards and Dave Brophy Vol. 37, No. 2: ©2006 and executive talent development. and 10 honored faculty members. Stephen M. Ross School of Business at the University of Michigan. Distilling Th is publication is produced twice a year by 7 Quote Unquote the Spirit of the Offi ce of Marketing Communications Sustainability and made possible through the generosity of Ross School of private donations. Business faculty Rob Frederick, For more information, contact Dividend, members talk on the MBA ’00, MS ’00, Stephen M. Ross School of Business record about assistant vice University of Michigan breaking news and president and 701 Tappan, Ann Arbor, MI 48109-1234. business trends. director of corporate responsibility at Brown-Forman Corp., develops Th e University of Michigan Regents: programs to address social David Brandon, Laurence B. Deitch, Olivia P. concerns and environmental issues. Maynard, Rebecca McGowan, Andrea Fischer 11 Faculty Research Newman, Andrew C. Richner, S. Martin Taylor, Katherine White; Ex-Offi cio Member, Mary Stakes High 45 Alumni Activities Sue Coleman, President, University of Michigan. When Emotions Club news from Th e University of Michigan, as an equal Undermine Sales Baltimore, Brussels, opportunity/affi rmative action employer, complies with all applicable federal and state Performance Chicago, Germany, New York and San laws regarding nondiscrimination and affi rm- ative action, including Title IX of the Edu ca- Richard Bagozzi Francisco. tion Amendments of 1972 and Section 504 of examines how the Rehabilitation Act of 1973. Th e University anxiety, shame, embarrassment, of Michigan is committed to a policy of non- pride, envy and other emotions discrimination and equal opportunity for all aff ect behavior across cultures. persons regardless of race, sex*, color, religion, 48 Class Notes creed, national origin or ancestry, age, mari- PLUS: Read the latest on the link Th e latest from friends, tal status, sexual orientation, disability, or between stock returns and tax rates classmates and colleagues. Vietnam-era veteran status in employment, and how a more progressive income educational programs and activities, and tax might curb workaholism. admissions. Inquiries or complaints may 54 Obituaries be addressed to the Senior Director for Insti- tutional Equity and Title IX/Section 504 14 Campaign 56 Alumni Network Update Coordinator, Offi ce for Institutional Equity, 2072 Administrative Services Building, Ann Arbor, Michigan 48109-1432, 734-763-0235, What It Takes: TTY 734-647-1388. For other University of The Michigan Michigan information call 734-764-1817. Difference *Includes discrimination based on gender identity and gender expression. Th e Ross School is one of the success Stephen M. Ross School of Business stories of the Univer- Web site: www.bus.umich.edu sity’s $2.5 billion Michigan Diff erence fundraising campaign, thanks to the support of alumni and friends.

dividend 2 fall 2006 Across the Board

BOO-YAH! Electronic Business and Finance Center. THORNE HEATHER “Swallow your ego. Be completely and Ross Students Fire utterly subservient. Be prepared to know everything about the market even when Up for Mad Money no one asks you so you can distinguish Left to right, Krystal Karam, BBA ’07, Dana ans of CNBC’s Mad Money with Jim yourself. Th e stock market is the fastest Simons, BBA ’06, MAcc ’07, and Jen Reed, Cramer were treated to more than the way to become rich. Th en you can go F BBA ’07, explain basic accounting principles usual stock tips when the program was fund what you really care about.” to high school students. broadcast from the University’s Michigan League on April 25. BEYOND WORD PROBLEMS Cheering fans created a sea of maize and instead,” she explained. blue and spontaneously burst into strains Introducing Teens Ross School Director of BBA Student of “Th e Victors” as they welcomed the Aff airs Rob Koonce organized the visit 51-year-old Cramer, a former hedge fund to Business with the cooperation of the Detroit Public School District’s Compact program, operator turned stock market rock star igh school students who excel in which works to prepare middle and high who inspired otherwise mild-mannered math and science oft en are encour- H school students for employment or col- business majors to paint their faces and aged to go into engineering or medicine. lege. His goal is to expand the program. scream “Boo-yah!” at the top of their lungs. Ross School lecturer Karen Bird would “We are planning to bring 450 ninth A technical crew numbering almost 50 like to see these top students exposed to grade students to participate this year,” he arrived April 23 to set up lights, audience another career option: business. added. seating, cameras and the director’s booth To that end, the Accounting Club, Th e outreach program was funded by at the League. Dozens of members of the which Bird sponsors, and the school’s Amex, Caterpillar Co. and Shell. A survey Ross School’s Accounting and Finance BBA Program this spring hosted 50 high given to students at the end of the pro- clubs joined Cramer’s extended crew. Th e school students at a half-day program gram confi rmed that they understood the students helped market the program and focusing on accounting. simulations and found them benefi cial. worked behind the scenes during the tap- Ninth graders from Wayne Memorial Th ey will be invited to participate in a ing. Th ey, along with audience members, High School in Wayne, Michigan, and program for 10th graders next year. met Cramer and received autographed Cass Technical High School in Detroit copies of Jim Cramer’s Real Money: Sane toured the U-M campus, watched a video Investing in an Insane World and back- and comedy skit and participated in COOL JOB packs fi lled with gift s from event sponsors. hands-on exercises teaching the basics Having already made his fortune, of fi nance, operations and strategy. John Fahey’s Cramer uses his television show, books Two student teams simulated real- and Web site to off er money management world accounting by creating a company Mission: Inspire advice and insight. He eschews orthodoxy name and purchasing and selling candy Others to Care and recommends that people devote 20 as stocks and cookies as their product. percent of their portfolios to pure specula- Accounting Club members also taught ational Geographic Society CEO tion because, in the long run, the “lottery a lesson in strategy using fi nancial state- NJohn M. Fahey, MBA ’75, admits he ticket” stock will greatly outweigh the losses. ments to compare the two companies. has a cool job. He travels to cool places “Accept sacrifi ce,” Cramer urged Ross Andrew Davignon, BBA ’06, the Ac- and has cool photographs hanging in his School students who attended a meet- counting Club’s former vice president offi ce. Drawing on his travels and experi- and-greet session the night before the of service, viewed the event as a way for ence, Fahey issued what he described as taping at the John R. and Georgene M. Tozzi the club to be more involved in the com- the ultimate challenge to 1,100 Ross School graduates in his April 28 com- Pom-poms, painted faces and Cramer’s munity. “Our hope was that they would mencement address at Crisler Arena. hypercharged personality create a pep rally become interested in business, learn what “How do we — and I really mean you — atmosphere for the Mad Money taping session classes to take in high school and apply manage this confl ict between the aspirations at the Michigan League Ballroom. to the Ross School.” Vanessa Staff ord, transition services shared by all humans and our planet’s coordinator at Wayne Memorial, said the ability to serve and sustain those dreams? program puts real-life jobs into perspec- It’s a complex question, the ultimate busi- tive and teaches students the importance ness quest,” stated Fahey, who combined

MARTIN VLOET MARTIN of investing. “A lot of these students humor and wisdom to encourage graduates spend money on gym shoes and clothing. to see the world from a larger view than Here they learn how they can own a piece their windows provide. of those companies by investing in them “You don’t always get a diploma. You

dividend 3 fall 2006 ACROSS THE BOARD ed to be an eff ective CEO. Arrow Electronics is a global provider $500,000 to the Ross School. of products, services and solutions to “Th is is a really exciting time to be part the electronic component and computer of the Ross School, with Th e Wall Street product industries. In addition to supply

STEVE KUZMA Journal No. 1 ranking in 2004, the very chain solutions, services and fi nancing generous donation from Stephen Ross capabilities, Arrow Electronics provides and the new building,” said Robins, as design and technical support to small and he presented a $264,111 check to Dean medium-sized businesses. Robert J. Dolan on behalf of BBA, MBA, Mitchell began the seminar by draw- Evening MBA and MAcc students at a ing a journey line refl ecting his personal dean’s reception on April 28. Ninety-fi ve life and professional experience. He percent of graduating MBA students do- plotted highlights and graphed the ups nated to the class gift program this year. and downs on the timeline. He encour- National Geographic Society CEO John Fahey Th anking the students, Dolan responded, aged students beginning their business says the most rewarding part of his job are the “It’s a fabulous monetary gift and gives us careers to do the same exercise. “You people who expand his horizons. great energy moving forward.” Th e BBA learn a lot more from failures than suc- and MBA class gift s will be used to equip cesses,” he noted. don’t always wear a robe. Th e degrees exercise rooms in the state-of-the-art Arrow’s strategy is based on four come from your life experiences. Since fi tness center planned for the new Ross pillars: growth, operational excellence, taking the job as head of the National School building. Th e MAcc class gift will fi nancial stability and shared leadership, Geographic, I’ve been fortunate enough go to MAcc Scholarship Assistance to help with shared leadership being the key to to be surrounded by many people with fund future MAcc students. Th e Evening success, Mitchell emphasized. “Alignment advanced degrees — degrees about the MBA class gift will be used to renovate is not agreement,” he said, but through world and all that’s in it,” he added. and beautify the Commerce Park lounge shared leadership, “people participate, are Th e CEO is fi rst and foremost a busi- with new carpet, lounge chairs, sofas, heard and make a diff erence.” nessperson. Armed with an MBA, he has appliances, tables and art. Executive MBA students pledged turned National Geographic into a mini- Arrow Electronics CEO Bill Mitchell media conglomerate that includes books, $303,916 to support the Endowed Speaker magazines, cable TV, a Web presence and Series, Endowed ExecMAP Fund and fi lmmaking. However, he said the people Alumni Fund. Th e Endowed Speaker who inspire him and expand his horizons Series brings business leaders and acade- are the most rewarding part of his job. micians to talk to Executive MBA students Fahey told the story of Mike Fay, an and alumni. Th e ExecMAP program sup- explorer and conservationist who trekked ports domestic and international Multi- 1,200 miles across equatorial Africa with a disciplinary Action Projects. Th e Alumni tribe of pygmies. Because of the attention Fund supports alumni activities and he brought to this part of the world, 11 enriches the overall Executive MBA percent of Gabon now has been preserved program. as national park land. He urged graduates not only to use SHARED LEADERSHIP their talents and “gift of an exquisite edu- cation,” but also hold on to their idealism, Arrow Electronics make responsible decisions and think beyond the short term. Above all, Fahey CEO Advocates stressed that “our mission is to inspire CORPORATE GOVERNANCE people to care about the planet. Our fu- Shared Leadership ture is not on an unalterable course.” hen Bill Mitchell became CEO at Engaged Boards WArrow Electronics in 2003, he was 2006 CLASS GIFTS the fi rm’s fourth CEO in eight months. Spur Growth Facing a daunting task, Mitchell built board of directors that is actively 95 Percent of MBA a strategic framework based on perfor- A involved in setting goals and shaping Grads Donate mance leadership and transformed the strategy can lead a company into success- company into an employee-focused ful growth opportunities, says Michael ed by a class gift core committee, business. “By and large people want to Ruettgers, special adviser and retired Lincluding Billy Robins and Kristine do a good job,” he said. “As CEO, your chairman of EMC Corp. Royer (MBA), Katherine Fedele (BBA), job is to unleash that.” Ruettgers, who served as CEO at EMC Todd Sarbaugh and Nancy Stano (Master At a Dean’s Seminar this spring, Mitchell from 1992 to 2001, talked about “Th e of Accounting) and David Mengebier, drew from his 30 years of experience, Role of the Board in Growth” at a Dean’s Terri Schultz and Linda Danek (Executive including three CEO positions, to counsel Seminar this spring. EMC is a world MBA), 2006 graduates pledged more than 20 Ross School students on qualities need- leader in products, services and solutions

dividend 4 fall 2006 ACROSS THE BOARD

for for information management world has changed, and the biggest and storage. challenge is communicating complex Th e information technol- development issues.” ogy industry is characterized NGOs benefi t from partnering with an by by constant disruptive tech- established fi rm through improved brand nologies, volatile product life awareness, acquiring more income and

cycles and a highly competi- becoming a vehicle for infl uencing policy, STEVE KUZMA tive marketplace. To survive Miller noted. “We all need to be pushed and prosper, he said, compa- sometimes, and corporations help keep DTE Energy Builds on Strengths nies must aggressively pur- us accountable.” As president and COO of DTE Energy, a utility Michael sue growth opportunities He also cited fi ve benefi ts for businesses with 2.1 million electrical customers and Ruettgers through innovative product that partner with NGOs: customer loyalty, 1.2 million natural gas customers, Gerard development. staff retention, better environmental Anderson, MBA ’88, MPP ’88, works on Growth opportunities should be the performance, enhanced brand profi le and some of the most serious public policy issues top priority for the board of directors, an improved bottom line. For CSR to be of the day, issues that affect the nation’s said Ruettgers. Members need to under- eff ective, Miller commented, fi rms and economy and the environment. Here, at a stand the industry life cycle, oversee long- NGOs must fi nd the right match and de- Dean’s Seminar this spring, he discusses with term strategy, and set and communicate velop standards to measure performance. Ross School students the utility’s business aggressive growth targets. Th ey also Before retiring in 2004, Miller spent 29 model and promising ways to produce energy should review the organizational struc- years in the U.S. Foreign Service working and improve the environment. ture and infl uence the selection of top on policy issues in the Balkans, the Middle management. East and Southeast Asia. He served at the Prior to passage of the Sarbanes-Oxley U.S. Embassy in Athens, including as U.S. American and Native American manage- Act in 2002, being a board member was Ambassador to Greece in 2001–2004. Miller rial talent into MBA programs. considered a cushy job that involved short earned four degrees, including a PhD in Edwards, also known as “Dr. E,” said quarterly meetings, Ruettgers said. Today’s political science, all from the University that although he is credited with solving expectations and requirements for board of Michigan. students’ problems, “Th e truth is they members are higher so companies can solve their own problems by talking it through. I just listen.” meet new standards of corporate respon- A TRIBUTE sibility and greater fi nancial disclosure. Students would congregate in his offi ce to Traits that characterize a strong board Honoring “Dr. E” discuss family, work and school, he recalled. include the ability to shape strategy, a “It was a social place. One of my colleagues climate of trust and openness with room he Black Business Students Association asked to move because it was so noisy.” for constructive dissent, individual ac- T(BBSA) honored Alfred L. Edwards, David Wooten, MBA ’87, PhD ’92, countability and periodic performance professor emeritus of business adminis- assistant professor of marketing, evaluations. “Growth is everyone’s busi- tration, for 32 years of contributions to described Edwards’ offi ce as a “Black ness,” Ruettgers concluded. the Ross School at the BBSA’s 30th annual student lounge. Th ere was a lot of student Conference and Annual Scholarship Rec- traffi c between classes and at the end ognition Dinner in February. of the day. Dr. E knew more about the DEAN’S SEMINAR More than 200 students, alumni, faculty students’ social lives than did many of and staff members and friends attended their classmates.” Corporations, the conference’s closing banquet, which Frederick McDonald, MBA ’95, said NGOs Benefi t included a cinematic tribute and the re- the conference should have been re-brand- naming of the event to the Alfred L. Edwards ed a long time ago. “I would respond a lot from Partnerships Annual BBSA Conference. quicker to an e-mail invitation that has In the tribute, Gautam Kaul, the John C. Dr. Edwards’ name on it because I would usinesses, nongovernmental organi- and Sally S. Morley Professor of Finance, do anything for him,” he added. Bzations and the public all benefi t from asserted that Edwards is proof things can corporate social responsibility (CSR), says change in this world by setting an example Erica Roberson, MBA ’06, congratulates Tom Miller, CEO of Plan, an international and taking risks. “He’s a players’ coach, Professor Emeritus Al Edwards at the 30th organization that helps children in emerg- always making students feel important,” annual Black Business Students Association ing countries and promotes Kaul added. Conference, which now bears his name. Plan CEO their rights and interests. Edwards, who joined the faculty in 1974, Tom Miller Speaking at a Dean’s Sem- has been a driving force in recruiting top- inar in April, Miller described notch minority students. He was instru- CSR as a partnership between mental in leading the Ross School’s eff ort the nonprofi t and corporate to join the Consortium for Graduate Study STEVE KUZMA sectors, adding, “We as a in Management, a 13-school alliance that planet aren’t doing as much works to bring African American, Hispanic as we should. Th e whole

dividend 5 fall 2006 ACROSS THE BOARD ration Assistant Professor of Business Administration. Th e one-year appointment “Dr. Edwards has done a lot of good years of sweat are the tools for something recognizes promising non-tenured faculty things for a lot of people,” said Lucy Reuben, that is successful and long-lasting.” whose excellence in scholarly research prom- MBA ’74, PhD ’91, a member of the Ross Th e Center for Venture Capital and ises to make a signifi cant contribution to School Visiting Committee. She spoke of Private Equity Finance of the Samuel Zell the understanding of the fi eld of business. Edwards’ generosity in sending textbooks and Robert H. Lurie Institute for Entre- Hyun-Soo Ahn, PhD ’01, assistant pro- to the Morris College Library, South Car- preneurial Studies hosts the MGCS, fessor of operations and management sci- olina State University’s School of Business which will be held on May 15-16, 2007, at ence, was named the Sanford R. Robertson and Benedict College’s Department of the Marriott at Eagle Crest, Ypsilanti. For Assistant Professor of Business Administra- Business and Economics. more information, visit tion. Th e one-year professorship recognizes Dean Robert J. Dolan said of the annual www.michigangcs.com. early career development and excellence conference, “It’s a very special conference. It in scholarly research. Ahn also was selected brings together three generations — alumni FACULTY by students to receive the 2006 BBA and current and prospective students — Teaching Excellence Award. and captures the spirit of Dr. Edwards.” 10 Recognized for William S. Lovejoy, the Raymond T. Perring Family Professor of Business and SILVER ANNIVERSARY Research, Teaching chair and professor of operations and management science, received the Victor MGCS Honors and Service L. Bernard Teaching Leadership Award. “Th is award recognizes contributions he Ross School honored 10 faculty across the board,” explained Dolan, who Founder members this spring for research, T noted that Lovejoy’s Integrated Product service and teaching excellence at the Development class, where students take an David Brophy school’s annual Faculty Awards Dinner idea from drawing board to marketplace he Michigan Growth Capital Sympo- and other celebrations. in 12 weeks, is one of the Ross School’s sium (MGCS), the fi rst university- Kathleen M. Sutcliff e, professor of man- T most innovative and popular courses. based venture fair in the United States, agement and organizations, was named Four other faculty members were celebrated its 25th anniversary in May. Th e Researcher of the Year. Th e award recog- honored for teaching excellence: annual symposium is a forum for fi nanciers nizes the substantial research contribution Jane E. Dutton, the William Russell to meet up-and-coming Midwestern fi rms and scholarly signifi cance of related publi- Kelly Professor of Business Adminis- and learn about emerging technologies. cations during a three-year period. Sutcliff e tration, chair and professor of manage- Th is year’s symposium, held in Ypsilanti, became associate dean for faculty develop- ment and organizations and professor attracted more than 425 participants: ment and research on July 1. of psychology (PhD Teaching Excel- angel and institutional investors, venture Sutcliff e has published a number of lence Award). capitalists and entrepreneurs from across papers in academic journals and numer- Gautam Kaul, the John C. and Sally the nation, as well as Ross School students, ous chapters and monographs during S. Morley Professor of Finance (MBA faculty and staff members. Forty-fi ve the past three years, noted Dean Robert Teaching Excellence Award). companies specializing in information J. Dolan at the Faculty Awards Dinner. M. P. Narayanan, chair and professor technology, life sciences and alternative Cindy A. Schipani, professor of busi- of fi nance (Executive MBA Teaching energy were showcased. In all, the MGCS ness law and chair of Law, History and Excellence Award). has presented more than 700 companies Communication, received the Contribu- James M. DeSimpelare, lecturer to the investment community since 1979, tion to the Research Environment Award, of accounting (Master of Accounting including Esperion Th erapeutics and which Dolan described as “a classically Teaching Excellence Award). Blue Gill Technologies, both presented Michigan award for a person who has in 1998, Arbor Networks in 2001 and served as an incredible role model for Asterand in 2002. colleagues and students.” Dean Robert J. Dolan presents the Contribution David S. Evans, BGS ’85, chairman and Susan J. Ashford, the Michael and Susan to the Research Environment Award to Cindy A. managing director of Glencoe Capital, Jandernoa Professor of Business Admin- Schipani, professor of business law and chair of presented the symposium’s fi rst Lifetime istration and professor of management Law, History and Communication. Achievement Award to David J. Brophy, and organizations, received the Andy associate professor of fi nance and sympo- Andrews Distinguished Faculty Service sium creator. Award. Th e award was created in memory “For over 35 years at the University of of Richard W. (Andy) Andrews, associate Michigan, Dave Brophy has driven excel- professor of statistics, who died in 2002. lence in education, entrepreneurship and Ashford has served as associate dean and VLOET MARTIN the annual symposium,” Evans said. “He senior associate dean for academic aff airs. has played the paramount role in expos- She is academic director of the Executive ing emerging growth companies to pro- MBA Program and an Academy of Man- fessional institutional investors and agement fellow. taught us the singular most important David Hess, assistant professor of busi- thing about success: A good idea and ness law, was named the Bank One Corpo-

dividend 6 fall 2006 QUOTE UNQUOTE t’s almost like a perfect storm. We “Ihave bankruptcies, labor and strike I don’t think that tensions and frictions are inevitable. issues, increasing costs and fewer people to I think part of the reason you have them is because China is serve the passengers. It’s a very big problem. still a developing economy and a developing polity. It does Few people really enjoy the experience of not have the established domestic institutions or international sitting on an airplane for a long period of roles that the United States has. So, obviously there would be time. You can do things like provide better some diff erences. China is at a diff erent stage of development food and service, but what really makes than the United States. As China becomes more developed people irritated is the information fl ow in all of these respects, then clearly we would expect actually when something happens.” a decline of friction, at least on the Chinese side. On the perceptual side, however, I don’t know how Americans will Claes Fornell, the Donald C. Cook Professor of view an up-and-coming power that might still remain Business Administration, professor of marketing somewhat diff erent from themselves. and director of the National Quality Research Center, talking about the toll fl ight cancellations Linda Lim, professor of strategy, discussing the relationship between China and the United States. and delays are taking on overall customer satis- — NewsHour with Jim Lehrer, April 20, 2006 faction with the airline industry. —The Wall Street Journal, May 16, 2006

he economy has been fairly strong these costs can be reduced 20 to 30 percent ow could the Chinese cooperate over the last few years, and that through electronic HR or outsourcing. But “T with us in the oil and energy makes it harder to make the case that, in the real investor impact is on the intan- “H sector if they don’t trust us enough to be the short run, tax cuts inevitably lead to gible value where HR can help investors confi dent that our Navy will not cut off tax increases or spending cuts. But I don’t have confi dence in future earnings.” their oil supplies if tensions rise? If we think anybody disagrees there are very can trust each other to cooperate in the large fi scal imbalances in the government. Dave Ulrich, professor of business administra- energy sector, then this in turn can con- It’s very clear we’ve made no progress. In tion and co-director of the Human Resource tribute to broader strategic trust in the fact, we’ve made the problem worse.” Executive Program, discussing ways to measure the results of the human resources function. overall relationship.” Joel Slemrod, the Paul W. McCracken Collegiate —The Business Times Singapore, April 24, 2006 Kenneth Lieberthal, the William Davidson Pro- Professor of Business Economics and Public Policy, fessor of International Business and professor of commenting on legislative efforts to extend cuts political science, urging Beijing and Washington to to tax rates on dividends and capital gains for he impact could be huge. It could talk openly to boost confi dence and avoid confl ict. two years. “Tshut down the agricultural sector, — South China Morning Post, May 30, 2006 — Washington Post, May 12, 2006 the service sector, the fast food industries,

coff ee shops and restaurants.” Cs and private equity fi rms are hen people know they can bring Katherine Terrell, professor of business economics looking hard under rocks and their pain to the offi ce, they no and public policy, speculating on the impact of “V “W around corners to fi nd deals. Th is is a longer have to expend energy trying to work slowdowns, economic boycotts and dem- great time for entrepreneurs to come up ignore or suppress it, and they can more onstrations by immigrants and their supporters with the next big thing.” easily and eff ectively get back to work.” to protest immigration legislation passed by the U.S. House of Representatives. David Brophy, associate professor of fi nance Jane Dutton, the William Russell Kelly Professor —The Detroit News, May 1, 2006 and director of the Center for Venture Capital of Business Administration and chair of manage- and Private Equity Finance. ment and organizations, concludes that when — InformationWeek, March 20, 2006 tragedy happens, a quick and compassionate here a car is built is a very fuzzy response in the workplace can boost productivity “Wthing. At one point, Joe Sixpack and build staff loyalty. had to drive an American car. Th at’s sim- oving off shore involves a trade- — Anchorage Daily News, April 17, 2006 ply diminished today. People with a scin- off . Typically you save a lot on tilla of sophistication will just buy what “M labor and you incur additional costs related to fi ts their lifestyle.” administration and other issues. For big n valuing today’s companies, about corporations, the economics still work. But 50 percent of market value comes Gerald Meyers, adjunct professor of management “I for midsized ones, it’s easy to overestimate from earnings and the other 50 percent and organizations and former chairman of how much you’re going to save.” from intangibles, which gives investors American Motors Corp., talking about an adver- tising campaign to convince consumers to “buy more or less confi dence in the future. HR Robert Kennedy, executive director of the William American.” helps with earnings by being more effi cient Davidson Institute and professor of business —The Detroit News, May 12, 2006 in employee transactions. Estimates are administration, cautioning fi rms not to overestimate that fi rms spend (US) $1,500 per year per potential savings from moving work offshore. employee on administrative costs, and — Austin American-Statesman, June 22, 2006

dividend 7 fall 2006 INTELLECTUAL CAPITAL Achieving the Extraordinary: Cleaning Up a Nuclear Nightmare BY KIM CAMERON Kim Cameron is a professor of management and organizations and co-founder of the Center for Positive Organizational Scholarship at the Ross School of Business. He also is a professor of higher education at the University of Michigan School of Education and previously served on the faculties of Case Western Reserve University, Brigham Young University, the University of Wisconsin and Ricks College. In his research Cameron explores organizational effectiveness, the devel- opment of management skills and the effect of virtuousness on organizational success. He has published more than 80 articles and 10 books, including Coffi n Nails and Corporate Strategies, Diagnosing and Changing Organizational Culture and Leading with Values. In 2006, Berrett-Koehler published his latest book, Making the Impossible Possible: Leading Extraordinary Performance — the Rocky Flats Story. It was co-written with his former student Marc Lavine, MBA ’03, MA ’04, a doctoral student at the Carroll School of Management, Boston College.

he Rocky Flats nuclear weapons content plutonium residues, nearly 15,000 production facility — a heavily cubic meters of transuranic waste, more T guarded, top-secret site housed than a half-million cubic meters of low- in 800 buildings on 6,000 acres less than level radioactive waste, and 30,000 liters 20 miles from downtown Denver — was of plutonium and uranium solutions — shut down in 1989 due to the suspicion some stored in leaking tanks and unmarked of extensive radioactive contamination. locations. Two buildings at Rocky Flats Th e site had more radioactive waste than were deemed the most dangerous in themselves out of work by shutting down any other nuclear weapons facility in the America due to high levels of radioactive the facility that had provided their fami- country. It housed 21 tons of weapons- pollution. More than a dozen rooms at lies with a livelihood for generations. grade nuclear material, 100 tons of high- the facility registered “beyond infi nity” Th e U.S. Department of Energy (DOE) on radiation meters. Walls, fl oors, ceil- estimated that it would take at least 70 ings, duct work and soil were heavily years and $36 billion to complete the contaminated. project, but it was questionable whether In 1995, Kaiser-Hill, a joint venture the job could ever be accomplished. No ANDY SACKS ANDY between ICF Kaiser Engineers and the one in Washington, D.C., or the state of environmental engineering fi rm CH2M Colorado saw this as an opportunity for Hill, was awarded a contract to clean up success. and shut down Rocky Flats. It was a stag- Th e Rocky Flats cleanup, however, gering task. No one knew how to clean up was an astonishing success — completed and close a nuclear weapons production 60 years ahead of schedule and nearly facility because it had never been done $30 billion under budget. All 800 build- before. In addition, the workforce at Rocky ings were demolished, all surface level Flats had a history of antagonistic relation- waste was removed, the on-site safety ships with facility management, environ- record improved fi ve-fold and the reme- mentalists, community activists, state and diated pollution levels surpassed initial federal regulatory agencies, and Congress. federal standards by a multiple of 13. Workers felt under siege and demoralized. Today, the site is being transformed into Th eir public persona had been transformed a wildlife refuge. from heroes who helped win the Cold A new book — Making the Impossible War to criminals who poisoned the Earth. Possible—examines this spectacular per- Kim Cameron Suddenly they were being asked to put formance by analyzing data gathered

dividend 8 fall 2006 INTELLECTUAL CAPITAL fi nancial benefi ts large enough to signifi - cantly impact their lifestyle, that is, to during the cleanup as well as interviews pared to the pursuit of virtuousness and provide opportunities never before af- with the individuals involved, including positively deviant performance. forded them. personnel from the DOE and the Envi- Achieving extraordinary performance THE MISSION MUST SURPASS ronmental Protection Agency (EPA), never occurs by accident, and leadership SELF-INTEREST: Increasing share- Colorado state and local offi cials, mem- is always a critical factor in accomplishing holder value and expanding market share bers of Congress and their staff ers, repre- these kinds of results. Here are a few of the are common organizational objectives, but sentatives of community organizations and oft en counterintuitive leadership values extraordinary performance requires a more environmental watchdog groups, manag- that were critical in closing abundance fundamental, long-lasting and humane THE PIXEL KITCHEN

LEFT Rocky Flats site in 1995 gaps and achieving phenomenal results at purpose. At Rocky Flats, workers were RIGHT This visual image of what Rocky Flats Rocky Flats. driven to go the extra mile, learned new would look like after cleanup helped build THE LONE HEROIC LEADER IS A skills and invested more creative energy consensus and contributed to success. MYTH: Individual leaders with positive because they were pursuing the profound energy, vision and the ability to get things purpose of mitigating the nation’s most ers and supervisors working on-site at done are indisputably important, but mul- dangerous toxic site and creating a wild- Rocky Flats, labor union leaders and work- tiple sources of leadership are necessary life refuge for future generations. ers. for sustained organizational success. Th is SYMBOLIC MESSAGES MUST A key factor in the Rocky Flats success was the case at Rocky Flats, where numer- REFLECT THE ORGANIZATION’S was their focus on positive organizational ous leaders in a variety of roles — within ASPIRATIONS: Most companies create dynamics. More specifi cally, success de- the DOE, the EPA, the state of Colorado, symbols, messages and images — logos, pended on closing “abundance gaps”— activist organizations and Kaiser-Hill — corporate colors, branding, slogans, insignia the gulf between normal performance and collaborated, shared common values and and font styles — intended to convey what the highest levels of performance imagin- aligned around a common vision. the organization stands for, what it does able. Usually organizations focus on cor- SIGNIFICANT INCENTIVES ARE and what its attributes recting problems and closing “defi cit NEEDED TO CHANGE THINKING: are. More impor- gaps”— elevating sub-par performance Research has shown that modest pay tant, however, are and overcoming obstacles. Treating a sick increases do not increase on-the-job sat- symbols, stories patient so the person returns to average isfaction or performance — and yet fi nan- and activities that health closes a defi cit gap; transforming a cial incentives are the most common refl ect what the healthy person into Olympic fi tness levels motivational tool used by organizations. organization aspires closes an abundance gap. In business, these At Rocky Flats, this approach succeeded to become. At Rocky gaps are represented by the pursuit of in fundamentally transforming employ- Flats, project leaders competitiveness and profi tability com- ees’ perspectives and performance be- tore down guard cause they had the potential to receive towers to convey a

dividend 9 fall 2006 INTELLECTUAL CAPITAL unimaginable dividends. Reaching for the highest aspirations possible had a powerful new openness, demolished a headquarters abandoned a hostile attitude toward state impact, which enabled the team to achieve building to get managers on-site with and federal regulators in favor of a collab- an objective that at one time seemed im- workers and took steps to nurture “peace orative, collegial relationship. Manage- possible — and to do so 60 years early and gardens” planted by protesters to demon- ment shift ed its focus from profi ts to a $30 billion under budget. strate the importance placed on relation- generous, share-the-benefi ts approach. ships with the community. For the Rocky Flats culture to change, BUREAUCRACY IS NECESSARY: individuals had to alter their beliefs and Scenes from Rocky Flats Popular business management literature behaviors. 1. Uncovering radioactive waste routinely promotes the need to destroy LEARNING FROM MISTAKES 2. Stripping concrete fl oors bureaucracy, break the rules, shred red tape IS OKAY, BUT LEARNING FROM 3. Using a glove box to handle materials and obliterate organizational processes. SUCCESS IS BETTER: Nobel laureate 4. Removing a glove box from the site Th e Rocky Flats initiative succeeded, Th omas Watson’s formula for success was however, because of tight controls, clear to “double your rate of failure.” Th at may standards, performance accountability, be true, but at Rocky Flats mistakes could precise adherence to established processes be costly, destructive or even deadly. that resulted in profi ciency, a decline Errors also made it unlikely that Kaiser- in mistakes and safety violations, and Hill would fi nish the job in a fraction of virtually fl awless performance. Careful the projected time at a fraction of the assessment, metrics, milestones and projected cost. In this case, the organiza- standardized procedures enabled Kaiser- tion focused on spectacular successes and Hill to achieve dramatic success in a extraordinary performance, identifi ed the compressed time frame. factors that made them possible, and 1. TRUST REQUIRES COLLABORA- determined other “enablers” that could be TION AND MUTUAL SUPPORT: morphed into a strategy and replicated. Consistency, equity, honesty and discretion Th e Rocky Flats team produced more are key prerequisites to trustworthiness in than 200 technological innovations by organizations. If people are treated fairly, analyzing what worked and then improv- are not deceived and have freedom to act ing on it. Errors and problems cannot be and observe consistent behavior, then trust ignored, of course, but they oft en con- is likely to be high. Th ese behaviors are not sume an organization’s time and energy. enough, however, to produce the extraor- At Rocky Flats, building on success was a dinary level of performance seen at Rocky priority that produced faster progress than Flats. Such success requires fl awless follow- analyzing mistakes. through on promises and commitments. BUILD STRATEGY ON VISION: At Rocky Flats, a single instance of infi - Most models of corporate strategy are delity could have permanently under- based on the organization’s core compe- 2. mined the trust of external stakeholders. tencies, the dynamics of the competitive People are fallible, of course, so mistakes marketplace and diff erentiators that can occur. To prevent problems from escalat- produce a sustainable advantage. Spec- ing to the point where trust is breached tacular results, however, require a strategy requires collaborative relationships within that is built on a vision of what is possible the workplace. Strong support provides and on what never has been achieved advice, assistance and resources that before — closing the abundance gap. Th e ensure positive outcomes are reached vision at Rocky Flats was built on achiev- before external constituencies encounter ing unprecedented levels of performance. the results. Once aspirations were articulated, a strat- CULTURAL CHANGE BEGINS egy to achieve them was constructed. 3. WITH INDIVIDUALS: Th e spectacular VIRTUOUSNESS PAYS: Th ere is results at Rocky Flats required a change in inherent value in adopting an “abundance the organizational culture, and that required approach”— that is, enabling the best of a fundamental change in people’s behav- the human condition, exhibiting virtuous iors and beliefs. Workers abandoned the behavior, helping people thrive, being gen- vision of a weapons production facility erous with resources, displaying unfailing that would provide them with life-long integrity, demonstrating humility and exer- employment and embraced the idea of cising faith. Within companies, however, shutting down the facility and working this approach also must serve the bottom themselves out of a job as fast as possible. line or it will be dismissed as irrelevant. At Th ey abandoned secrecy and a closed Rocky Flats, virtuousness — pursuing the culture and adopted openness. Th ey best of the human condition — produced 4.

dividend 10 fall 2006 FACULTY RESEARCH A Downward Spiral From Bagozzi’s studies, conducted with Willem Verbeke of Erasmus University in the Netherlands, a picture emerges of Stakes High When salespeople who are, at certain times and under certain circumstances, vulnerable to self-conscious emotions such as fear, Emotions Undermine shame and embarrassment. Let’s say a salesman is calling on a pro - spect for the fi rst time. Meeting someone new, feeling pressure to make a good Sales Performance impression, and being wary of transgres- sions and fearful of rejection can all cause self-consciousness. The emotional undercurrent facing salespeople can be treacherous, according Th e salesperson and customer come from diff erent organizations and have to research by Richard P. Bagozzi, professor of marketing at the Stephen M. diff erent backgrounds, expectations and Ross School of Business. In a series of studies published since 2000, Bagozzi objectives. Th ere may be diff erences in explores how anxiety, shame, embarrassment, pride, envy and other emotions age, gender, race, religion, sexual orienta- affect salespeople’s behavior. tion, social class and standing in the corporate hierarchy — diff erences that he way salespeople cope with can be magnifi ed during a stressful sales emotions and their eff ects has a encounter. Th e salesman questions T direct relationship to job perfor- himself —Am I dressed appropriately? mance, says Richard P. Bagozzi. Self- Have I said the wrong thing? Have I been STEVE KUZMA conscious emotions generally are insensitive? Doubts emerge about dealing triggered automatically; and salespeople with the customer — How does she prefer who cannot control them may become to be addressed? Should I be deferential? aroused, angry, anxious or despondent What does she think of me? during a sales call, which may cause What if the salesman does say customers to question their credibility. something that might be perceived as Sales-call anxiety, for example, is com- inappropriate? He appraises the situation, monly accompanied by a protective urge consciously or unconsciously, and physi- to withdraw from the sales encounter — ological changes occur — he sweats, his to avoid contact with customers or, when heart races, his voice quivers, his stomach Bagozzi, who is also professor of social and contact is made, to be submissive and becomes queasy. His attention and judg- administrative services at the College of avoid taking steps to close the sale. ment are heightened and he focuses in- Pharmacy, taught at the University of Michigan Th e adverse eff ect this behavior can have tensely on communication signals and from 1986 to 2001 and then at Rice University on sales revenue growth is obvious — and social stimuli from the customer. His before returning to the U-M in 2005. He has signifi cant. Salespeople face the possibil- ability to interact eff ectively may be cur- published 206 journal articles and authored ity, even the likelihood, of experiencing tailed. Th is is followed by new emotions or edited 14 books. His research spans repeated rejection and failure day aft er triggered by the negative emotions — multiple areas, including structural equations day, a diffi cult psychological environment being angry about being ashamed, for modeling, attitudes and emotion, the behavior for sales personnel who are susceptible to example, and hard-to-control rumina- and performance of salespeople, and develop- self-conscious emotions. As a result, tions: Am I capable of doing this job? ment and refi nement of the Theory of Action, sales-call anxiety is quite prevalent, reach- In the future, the salesperson may which addresses why people do not carry out ing intense levels for up to 40 percent of adopt “protective strategies” that help health-related behaviors despite positive salespeople at some point in their careers. him avoid this type of anxiety. Th is may attitudes and strong intentions. translate into an inability to accomplish key tasks —reaching out to new custom- Bagozzi received the Paul D. Converse Award ers, posing pointed questions and for Outstanding Contribution to the Science of nur turing relationships, an inability Marketing from the American Marketing that eff ectively takes him out of the sales “Coping with emotions,” Bagozzi explains, Association in 2004 and an honorary game. Th e greater the shame and doctorate from the University of Lausanne, “differs fundamentally when you look at embarrassment the salespeople feel, Switzerland, in 2001. Bagozzi has found, the greater their it from one culture to another.” protective action and subsequent decline Dean Robert J. Dolan said, “Richard Bagozzi in performance. is arguably the most infl uential researcher in marketing and is recognized as one of the great scholars of his generation.”

dividend 11 fall 2006 FACULTY RESEARCH

Sales-call anxiety is quite prevalent, reaching intense levels for up to 40 percent of salespeople at some point in their careers.

Bagozzi and Verbeke wrote in Psychology & Marketing in 2002. Countermeasures include: Awareness: It’s necessary to under- stand destructive behavior in order to change it. Sales managers should be equipped to recognize the signs of self- conscious emotions. When they suspect that fear, shame or other emotions are adversely aff ecting performance, they should alert the salesperson and work together to address the problem. It’s im- portant to adopt a coaching style and help the salesperson understand that her or his responses and behaviors are not unusual and can be managed. Be aware of triggers: Self-conscious emotions oft en arise when salespeople are pushed out of their comfort zones — Th is strategy is likely to cause their per- Cultural Variations for example, when sales strategies or cus- formance to suff er. To Filipino salespeo- At least that’s the picture in Western tomer accounts change. ple, on the other hand, shame during a cultures. In a fascinating study published Face the fear: Anxious people con- sales encounter is a threat to their social in the Journal of Applied Psychology in tinuously perceive themselves as vulner- identity. For that reason, shamed Filipino 2003, Bagozzi, Verbeke and Jacinto C. able and subject to danger. When they salespeople don’t withdraw from the sales Gavino Jr. of the Asian Institute of Manage- avoid threatening situations, they never process. Instead, their protective instinct ment found very diff erent results in Asia. accurately gauge the threat or their ability is to take steps to repair the relationship Th e researchers compared the eff ects to overcome it, so their anxiety remains. with the customer, co-worker or supervi- of shame on salespeople from the Nether- A repertoire of responses: It is oft en sor at the center of the shameful experience. lands, who see themselves as autonomous customary not to acknowledge an event In this way, Filipino salespeople stay individuals focused on personal achieve- that triggered self-conscious emotions engaged in the sales process to address ment, and the Philippines, who see them- during an encounter. On the other hand, the issues that caused the shame, and selves as part of an interdependent social salespeople can develop emotional intelli- their job performance improves relative network focused on collective goals. gence that enables them to detect and to Dutch salespeople. “Coping with emo- Th ese groups experience the same eff ects respond appropriately to non-verbal sig- tions,” Bagozzi explains, “diff ers funda- from shame — heightened attention to nals that convey disapproval. Th ey also mentally when you look at it from one themselves, a sense of vulnerability, phys- can develop scripts and practice respons- culture to another.” iological symptoms and an urge to take es to potentially diffi cult exchanges in action to protect their core self-image. order to sidestep the urge to avoid the “Th is is part of our biology that we share Corrective Action interaction. with every body,” Bagozzi says. “It’s hu- How can a salesperson short-circuit Reduce approval seeking: Salespeople man nature.” the negative eff ects of self-conscious emo- with a high need for approval are less When shamed, Dutch and Filipino tions? Involuntary responses cannot be likely to ask for it and more likely to eval- salespeople both take steps to protect prevented, but Bagozzi’s research suggests uate themselves negatively. Sales manag- their core identity; but their core identi- eff ective countermeasures. “Th rough ers can help them understand what their ties diff er dramatically and so do the training, role-playing and practice, sales- self-worth is based on and teach them to protective steps they take. To Dutch sales- people can learn to respond in ways that focus on knowledge of the customer and people, shame signifi es personal failure bring the sales interaction back to a func- the product and not to overemphasize the and threatens their self-worth. To protect tional and objective exchange of informa- need for approval for its own sake. their individualistic self-image, they will tion and away from the disruption of avoid situations that can lead to shame. inappropriate and self-defeating behaviors,” Dave Wilkins

dividend 12 fall 2006 FACULTY RESEARCH smaller fraction of dividends. Dividend- paying stocks face, on average, an eff ective ing more hours per week throughout tax rate nearly three times higher than the Is Workaholism their careers and working beyond their eff ective tax rate of stocks that do not pay intended retirement date. Moreover, dividends. an Addiction? workaholics acquire their addiction early However, these highly taxed, dividend- or some people in their careers. paying securities tend to earn signifi cantly Fworkaholism may higher returns. Th e average return spread be an addiction, just between high-dividend and no-dividend like smoking and alco- Highly Taxed stocks is 4.55 percent, whereas the spread hol are for others, says is 3.63 percent between all stocks that pay Joel Slemrod, the Paul Stocks Yield Higher dividends and those that do not. W. McCracken Colle- Returns Sialm says that although dividends are giate Professor of Busi- highly correlated with the eff ective tax rate, ness Economics and Joel Slemrod nvestors who own it is the latter and not the former that is the Public Policy. Istocks that are more driving force behind the higher expected “High-income, highly educated people heavily taxed also returns. “Stocks paying high-dividend are particularly likely to suff er from work- receive higher returns. yields tend to have relatively high risk- aholism with regard to deciding when to Using new data cov- adjusted returns, particularly in periods retire — going cold turkey on their addic- ering tax burdens on a a when taxes are high,” Sialm says. “Th is tive behavior,” says Slemrod, who also cross-section of equity result indicates that the reported eff ects directs the Offi ce of Tax Policy Research securities between 1927 are likely due to taxes and not due to the at the Ross School of Business. and 2004, Clemens Clemens Sialm fact that dividend yields might proxy for Workaholism, he says, has been linked Sialm, assistant pro- additional risk or style eff ects.” to a variety of health problems, including fessor of fi nance, found a strong link be- exhaustion, stress and high blood pressure, tween risk-adjusted stock returns and and can take an emotional and mental toll eff ective personal tax rates (total tax paid Kresge Library on a worker’s family. divided by net taxable income before Recently, prominent economists have taxes). Provides Alumni supported very high taxes on cigarettes and Specifi cally, a one percentage point other addictive activities, arguing that these increase in the eff ective tax of an equity Access to News taxes may actually benefi t smokers who portfolio increases the average return of and Research suff er from self-control problems. Unlike the portfolio by 1.54 percentage points. cigarette excise taxes, which are highly “Consistent with tax capitalization, stocks oss alumni can fi nd links to data- regressive (those with lower incomes pay facing higher eff ective tax rates tend to Rbases that contain thousands of a greater proportion of income in taxes), compensate taxable investors by generat- articles and career resources online at the appropriate corrective policy for ing higher before-tax returns,” Sialm http://www.bus.umich.edu/KresgeLibrary/ workaholics — who tend to make more found. “Th e average returns of highly Services/AlumniServices. Kresge money — might involve levying a more taxed securities tend to be high because Library currently provides alumni free progressive income tax burden (those with their valuation levels are relatively low. access to 12 databases, including: higher incomes pay a higher proportion of Th us, taxes tend to depress asset valua- Business Source Premier — Contains income in taxes), Slemrod says, although tions, resulting in higher average before- 2,480 scholarly journals and business not necessarily higher taxes overall. tax returns.” periodicals. Using data from the University of Sialm’s study shows that eff ective tax CareerSearch — Provides recruiting Michigan’s Retirement History Survey and burdens have varied signifi cantly over contacts by industry, geography and Panel Study of Income Dynamics, Slemrod time. For example, the eff ective tax rates size for nearly one million potential and colleague Daniel Hamermesh of the on the market portfolio of common employers. University of Texas found that workers with stocks exceeded 25 percent in 1950, but Factiva — Off ers company and indus- more education are less likely to follow dropped to less than 5 percent in 2004. try fi nancial data and news stories through with their intended plans to retire. “Th e aggregate tax burden on equity from 6,000 publications, newspapers In fact, each additional year of schooling securities has declined over the last cou- and magazines. increases the expected age of full or par- ple of decades as tax reforms reduced WetFeet.com — Provides access to tial retirement by about four months. the statutory tax rates on dividends and WetFeet.com’s company and industry “Th e results suggest that certain more- capital gains,” Sialm says. “Furthermore, Insider Guides. educated and higher-income respondents corporations replaced a signifi cant fraction simply cannot help themselves,” Slemrod of relatively highly taxed dividends with Additionally, alumni can view Ross says. “Th ey express an expectation of share repurchases.” School faculty working papers at the Social retirement, but when the time comes, According to Sialm, stocks that distrib- Sciences Research Network. For more they are less likely to be retired.” ute a greater proportion of their total details, visit http://www.bus.umich.edu/ According to the study, workaholics returns as dividends tend to be taxed KresgeLibrary/Collections/Working misjudge the benefi ts and costs of work- more heavily than stocks that distribute a Papers.

dividend 13 fall 2006 CAMPAIGN The Michigan Difference WHAT IT TAKES

he Ross School is both proud of facilities. Th e Ross School has been one of when recruiters are placing new gradu- and grateful for the support it has the success stories of this campaign, raising ates around the world.” T received from friends and alumni over $300 million to date. With two years In addition to the unprecedented gift committed to making us, undeniably, the left in the campaign, we expect that the of $100 million from Stephen M. Ross, best at what we do. momentum created by the extraordinary BBA, ’62, other gift s from generous alumni In 2004 the University of Michigan support of our alumni and friends will have enabled the school to move forward announced the most ambitious fundraising enable Ross to meet its $350 million goal. with an extensive facilities project that campaign in its history. Th e Michigan “By developing innovative new pro- will transform the learning environment Diff erence is a $2.5 billion capital cam- grams and building a new physical plant for students and faculty. paign supporting scholarships, endowed to support these programs, we will be able Th e necessary funds have been raised professorships, academic programs and to off er the best business education in the to begin construction, but fundraising world,” says Dean Robert J. Dolan. “Our continues so that we can meet the balance talented students will gain the necessary that will be required by the end of con- business knowledge and analytical skills, struction. We also seek support for the and they will develop unique leadership programs and people that distinguish skills through our action-based learning Ross as a superior business school. programs. Th is combination of theory Ross alumni and friends are motivated and practice will prepare Ross students to by students and their stories about the compete with the brightest and the best rigor and utility of a Ross education. Support from people like Samuel Zell, BA ’63, JD ’66, and Tom Jones, BBA ’68, Stephen M. Ross

dividend 14 fall 2006 CAMPAIGN

MBA ’71, off ers students the opportu- nity to gain practical, real-world expe- A Blueprint for the Future rience while they still have the sup- port of Ross’ world-class faculty. Will Caldwell, AB ’48, MBA ’49, onstruction is underway for the new $250,000 AND ABOVE attributes his success at Ford Motor CRoss School of Business. Th anks to Michael J. (BBA ’80, JD ’83) and Co. to speech courses he took as an the $100 million gift from Stephen M. Dede (BGS ’80) Levitt of Alpine, N.J. undergraduate in LSA. He and his wife Ross and many other generous alumni, we John (MBA ’05) and Nancy Kennedy Jeanne have endowed a fund named are managing this project on a timeline of Grand Rapids, Mich.; gift will recog- the Richard Dennis Teall Hollister that minimizes disruption to our comm- nize the Executive MBA Class of 2005. Business Communication Fund in unity, allowing us to continue to operate honor of the professor whom he cred- on part of our original footprint while Michael (BBA ’66, MBA ’67) and its with giving him the skills to suc- construction takes place. Mary Kay Hallman of Redmond, Wash. ceed. Th e $1 million endowment will Th e goal for the 270,000-square-foot, enhance the BBA Communications $145 million facility is a complete transfor- Robert Tom Zankel (AB ’85, MBA ’91) program by off ering new classes that mation of the learning environment for of New York, N.Y. explore intercultural communications students and faculty, designed as a perfect with overseas partners, and programs fi t for the Ross School’s action-based $100,000 AND ABOVE curriculum. such as a speaker series that would David (BGS ’83) and Gayle Sidler invite experts in the fi elds of presenta- (AB ’83) Bernhaut of Watchung, N.J. tion, persuasion and communication Difference Makers strategies. Recently many alumni and friends have Lisa Black (MBA ’87) of Rye, N.Y. David Carson, BBA ’55, has donated made generous gift s to the campaign, a David S. (BBA ’62, MBA ’63) and funds to create the Carson Scholars portion of which will ensure the building Shelley Hickman of Tecumseh, Mich. program. Last spring, through Carson’s project’s success. While the school continues support, four dozen BBA students spent to raise funds, lead gift s have come from: Michael (BBA ’87) and Dana Hokin a week in Washington, D.C., exploring of Scarsdale, N.Y. the relationship between government Hal (MBA ’68) and Mary and business. To read more about $1 MILLION AND ABOVE (AB ’69, CERTT EDUC ’71) Kellman David Carson and the Carson Scholars Jeff Blau (BBA ’90) of New York, N.Y. of Fremont, Calif. program see the article on page 32. Jane Caplan (BBA ’86, MACC ’86) Stanley Frankel, AB ’63, MBA ’64, Clyde (BBA ’70, MBA ’74) and Harriet and Dan Och of Scarsdale, N.Y. and his wife Judy have made it possible (AB ’69, CERTT EDUC ’69) McKenzie to leverage the talent and resources of Campaign Co-Chair Michael of Empire, Mich. the Ross School to increase the num- (BBA ’75) and Susan Jandernoa Vincent McLean (BBA ’54, MBA ’55) ber of successful commercial ventures of Grand Rapids, Mich. of Westfi eld, N.J. that originate at the school. Th e Frankel

Commercialization Fund supports the Frederick (MBA ’67) and Darla Brodsky Ravi (MBA ’96) and Christine (MBA ’97) development of entrepreneurial skills of Dallas, Texas Mohan of San Francisco, Calif. by giving students the opportunity to Stephen (MBA ’70) and Karen Sanger Timothy W. (MBA ’80) and work with inventors and venture capi- of Minneapolis, Minn. Beth O’Day of Hinsdale, Ill. tal companies to accelerate the com- mercialization of products and pro- Judy and J. D. (BBA ’67, MBA ’68) Richard E. (MBA ’72) and Ann Caroline cesses. Williamson II of Salinas, Calif. Posey of Chagrin Falls, Ohio So please take a moment to cele- G. Leonard (BBA ’64, MBA ’65) and brate what the Ross community has $500,000 AND ABOVE Dorothy Teitelbaum of Holmdel, N.J. achieved to date in making the Michigan Andrew Barowsky (MBA ’74) Diff erence a reality. We hope you look of Auburn, Maine A. Kirk (MBA ’80) and Connie Twiss forward, as we do, to the Ross School’s of Chicago, Ill. continuing evolution into one of most Michael R. (MBA ’83) and Debra infl uential learning communities of Gelband of New York, N.Y. Gary T. Walther (BSME ’60, MBA ’63) the future. of Chicago, Ill. Th e Globe Foundation through the Wendy Palms auspices of Bert A. Getz (BBA ’59) of Scottsdale, Ariz., and Bert A. Getz Jr. (MBA ’95) of Northfi eld, Ill., and family Jeff rey (BBA ’82) and Jan Rich of Dallas, Texas

Will Caldwell

dividend 15 fall 2006 ALUMNI AT LARGE Electric. With an MBA in international business and an MA in Asian Studies, she easily could have resumed her career abroad. But she wanted to prove herself Managing HR in a in a large American corporation. “I had only worked for small businesses; my early experience was in managing call centers for my mother’s telephone Multicultural World answering service. So I was always in- trigued by large companies. Th ey seemed to off er a wealth of resources — much like CYNTHIA TRAGGE-LAKRA, MBA ’93, MA ’93 the University of Michigan. “GE views HR as pivotal to the com- pany’s future,” she adds. Working within fi ve diff erent GE businesses over the past “The way I interact with someone in 13 years, she is responsible for leading the company’s strategy on labor and commu- Brazil is quite distinct from how I interact nication issues and executive talent devel- with people in the U.S. or Canada. opment. Tragge-Lakra and her team support some 33,000 workers across 15 Understanding what motivates employees countries. in different cultures and environments is Her attraction to other cultures also is refl ected in her personal life. She is key to running a successful multinational married to Rajeev Lakra, MBA ’91, who company.” works at GE in risk management and has family ties to India, Th ailand and Singa- pore. Besides international travel, the couple’s spare time is focused on their Tragge-Lakra came to the University of three-year-old daughter Lauren. Th e Michigan to pursue an interest in French family lives in Weston, Connecticut. literature, but became captivated by Chi- Each day, Tragge-Lakra engages the na — its social movements, history and curiosity about people and cultures she culture. “Asia was the wave of the future, discovered in high school. She credits and I wanted to be on board.” She moved Michigan with deepening her under- to mainland China aft er graduation and standing of each business function in quickly found work in Beijing and later the global environment. “From an HR in Fukuoka, Japan. Th en, ready to expand perspective, it helps me assess individual her skills, she looked for a degree pro- capabilities and develop leaders and pro- s senior vice president of human gram that combined international busi- grams that will meet our future needs. resources for GE Consumer ness and Asian studies. Nothing topped “What’s exciting is that I’m really A Finance, Cynthia Tragge-Lakra the opportunities at Michigan. responsible for understanding the diff er- brings a lifelong appreciation for cultural “Because of the way the Michigan MBA ences among employees from country diff erences. is structured, I gained a much deeper to country,” she relates. “Th e way I interact with someone in understanding of how multinational “I also try to focus on what’s the same: Brazil is quite distinct from how I interact companies operate,” she relates. “Beyond a corporate culture that emphasizes integ- with people in the U.S. or Canada,” she general management, we were exposed rity, personal development and perfor- observes. “Understanding what motivates to aspects of accounting, statistics, opera- mance. Th ese are core values that we have employees in diff erent cultures and envi- tions, fi nance — the full range of expertise proven work throughout the world.” ronments is key to running a successful that is needed to move the whole enter- Pat Materka multinational company.” prise forward.” Her global awareness emerged early. She was in on the early stages of the For three years in high school, Tragge- school’s Center for International Business Lakra was part of a special program in Education and helped launch the William which students met and discussed world Davidson Institute. A Global Fellow, events from alternate viewpoints. “For Tragge-Lakra also made valuable contacts example, a textbook might teach about with participants in Executive Education, World War II from a U.S. perspective, but and gained insights on “how executives we would look at it from the vantage of think.” Professor Noel Tichy, director people living in Germany or Japan,” she of the Global Leadership Program, raised explains. “Th e point was to recognize her interest in human resource manage- there is no single right way of thinking.” ment and opportunities at General

dividend 16 fall 2006 ALUMNI AT LARGE uate course in business and environment. “I enjoy things that are new and entre- preneurial — diff erent interests coming together and fi nding a common ground,” Distilling the Spirit says Frederick, who sees internal educa- tion, along with advocacy, as a key part of his role at Brown-Forman. He is bolstered by a strong network of peers entering this of Sustainability growing fi eld of practice, bringing in brands like Nike, Starbucks and Timberland, and more recently GE and Wal-Mart. ROB FREDERICK, MBA ’00, MS ’00 Another plus: “My wife Amy, who is

rom SUVs to Kentucky bourbon, important across all our Rob Frederick’s career path made business activities, from F a jackknife turn. And it illustrates how the grains and a promising trend: More companies are grapes are grown, to addressing environmental and social how the product is made issues as part of their business plan. and transported, to what “Sustainability — a commitment to happens to the empty social responsibility and environmental bottles. How do we stewardship — is reaching beyond niche conserve our natural leaders like Ben & Jerry’s and Patagonia,” resources?” he contends. One mainstream example Brown-Forman is Ford Motor Co., where Frederick was points to a history of part of a small team of specialists focused citizenship; however, its on sustainable business practices. For fi ve newly created corporate years, he led Ford’s response to issues offi cer position raises that such as greenhouse gas emissions and commitment to a new climate change. He helped market the level. Frederick heads a fuel-effi cient Escape Hybrid and devel- small offi ce that reports oped a corporate citizenship report that directly to the COO. was ranked second best in the nation. And what is the source of his passion? “I wish I had an epiphany He sees two opportunities for students story,” he confesses. Maybe it was the family who share his interests: “One, become vacations in Maine and studies abroad in Australia that made him a specialist in corporate responsibility; a PhD candidate in art history, is from appreciate “the pristine outdoors.” He Louisville, so this is a rare chance to be or two, expose yourself to environmental found an instant match in Duke Universi- close to family while doing work I love.” ty’s new degree program that combined Th e Fredericks have two daughters, Lucy, and social issues and bring this aware- environmental science, public policy and 1, and Caroline, 4. He is active in several ness to whatever fi eld you choose.” economics. “As an undergraduate might, local and international organizations, I thought companies were at the root of serving on the boards of Bernheim Forest the problem,” he relates. Th ree years into and Global Reporting Initiative. He also In 2005, Frederick was named assistant working near D.C. as an environmental enjoys Kentucky horseracing, running vice president and director of corporate analyst, he decided that companies could and golf. responsibility at Brown-Forman Corp., be part of the solution. Frederick sees two opportunities for whose products include name-brand “And at Michigan’s business school, students who share his interests: “One, wines and spirits such as Fetzer and Jack I realized companies have considerable become a specialist in corporate responsi- Daniel’s. In his new position, he is devel- power and infl uence to bring about chang- bility; or two, expose yourself to environ- oping programs addressing social concerns. es.” Once again Frederick chose a new mental and social issues and bring this “Th e issue is how we encourage responsi- entrepreneurial program leading to an awareness to whatever fi eld you choose.” ble consumption of our product. We must MBA and an MS degree from the School Either path is positive. “Ultimately, tackle problems such as underage drink- of Natural Resources and Environment we need to be able to make the case that ing and drunk driving. Alcohol abuse is through the forerunner of what today is responsible business is better business,” bad for our communities, our consumers known as the Frederick A. and Barbara he concludes. “Th e Ross School’s MBA and our company. M. Erb Institute for Global Sustainable program gives you the skills and language “Th ere is also an environmental com- Enterprise. While at U-M, he helped to take action and make a diff erence.” ponent,” he continues. “Stewardship is create and teach the fi rst-ever undergrad- Pat Materka

dividend 17 fall 2006 JOEL TAUBER HOLDS FAST TO PRIORITIES A Balanced Life IDENTIFIED YEARS AGO PHILIP DATTILO

oel Tauber is on his feet fast with his ing empire, running the massive United simple plan, and it worked. hand extended and a quick grin Jewish Appeal and playing a central role “I said, okay fi rst I have to think of my J lighting his face. His words roll out in the historic emigration of hundreds of family, my kids. Second came making a fast too. You’ve barely entered the offi ces thousands of Jews from the Soviet Union living: I have to feed everybody. Th ird came of Tauber Enterprises, high over suburban and Ethiopia to Israel. physical fi tness. My dad died very young. Detroit, before he’s running you through Yet for all his sense of hurry, he leaves Heart — 52 years old. So that became a the framed family photos along the window the impression of a life in balance. He lacks matter of urgency.” sills —“…wonderful wife, wonderful kids…” the uneasy restlessness that one detects in He gestures to his fl at belly. “As you —then a quick autobiography—“I’ll just many highly successful people. At 71, he’s can see, 71 years old, not too bad. give you a brief summary…”—a round-up been working for nearly 50 years. But he “Fourth was philanthropy. Fift h was of his current projects —“Th ere’s a lot going looks and acts young. He may move fast, social. on…”— a list of changes he’s pushing for but you sense the serenity at his core. You “Every few years, I’d reevaluate where the Ross School’s Tauber Manufacturing think: “Th is is a happy man.” I was in my life. And I’ve kept those same Institute —“It’ll make a huge diff erence…” Tauber started fast. He graduated from priorities to this very day. Th e amount of — a glance at the auto-supply industry— Detroit’s Mumford High School, the same time I’ve put into each varied drastically. “I’m convinced now is the right time to buy…” alma mater as another business school But the priorities stayed the same. — a quick analysis of the Arab-Israeli benefactor, Stephen M. Ross. By age 24, “Where I had a confl ict, I always chose crisis —“…the U.S. must mediate, it can’t he had completed a BBA (1956) and a law things in that order. My son said to me may- happen without the United States.” degree (1959) at Michigan, married and be a year ago, ‘Dad, how did you always And before you know it an hour is gone started a family. A Michigan MBA (1963) go to all my events and manage my teams? and you’re out the door thinking that only came soon thereaft er. I’m going crazy here trying to do all these a guy who covers ground that fast could Caught up in the cross-pressures of things!’ I did it because that was what was do everything Tauber has done, which family and work, he sat down with pencil important to me.” includes raising a family, building a small and paper before he was 25 and wrote down scrap-metal business into a manufactur- a set of priorities. It was an astoundingly

dividend 18 fall 2006 aking a living — and it became a Mvery good one — occupied most of his time for the fi rst 30 years of his career. His fi rst wife’s father Barney Keywell — “a major, major part of my life”— hired Tauber to help run his newly acquired manufacturing operation, which had supplied the auto industry for many years. Despite a divorce, Tauber remained the head of the operation. He diversifi ed the fi rm into plastics, engineered a series of Joel Tauber helped relocate Jews of Ethiopia to Israel in 1991, when the African nation was leveraged buyouts and by the early 1990s embroiled in civil war. presided over close to a billion-dollar cluster of companies with some 30 facto- saying, ‘I’ll do this little piece and you ries. Married to his second wife Shelley, guys have to do the rest.’” he began to devote much more of his time Tauber immediately became engaged In his 45 years in American industry, and energy to philanthropic activities. in TMI, including spearheading the rest Tauber has seen hard evidence of the Among his interests was the University of its endowment fundraising. He saw of Michigan Ross School. His key contribu- that if manufacturers were consulted on proposition that success requires keen tion — the Tauber Manufacturing Institute what should be taught at TMI, they’d attention to constant improvement. (TMI) — began with the memory of his spend less on educating new graduates own transition from business school to the about real-world manufacturing, thus “The Japanese who came up with the job of running a factory that made those making those fi rms good prospects to Toyota method — I was thinking about most basic of industrial products — nuts become donors to the institute. Th at and bolts. approach has helped TMI establish an that the other day,” he says. “How did “I found out that even with all my degrees, endowment worth close to $20 million. we let them come up with that? We I was totally inadequately prepared for Now, a decade later, Tauber is watching what I faced,” he says. “My fi rst problem the globalization of manufacturing and dropped the ball there. The steel in- was just how to count the stuff . For a lot arguing for TMI to push its boundaries dustry in the ’60s, the auto industry in of reasons, people wouldn’t give me an outward. “Th e world’s changed,” he says. accurate count. You know, I was all set “Th e Dell model of doing no manufacturing, the ’80s, IBM in the ’90s — you think to use my accounting knowledge and it just managing the supply chain, has become totally distorted my books, because my the prevalent methodology. Cars today are you have the right formula, but you base numbers were wrong. I was getting made everywhere — Japan, America — and never do. ” bad production numbers. So I set up a the parts come from all over. So the whole training program for myself.” nature of manufacturing has changed.” Th e idea of a joint manufacturing pro- As a key adviser to TMI and a member gram in business and engineering to pro- of its industry advisory board, Tauber vide training in real-world manufacturing wants to see the institute set up close ties settings took shape at the U-M in the with business schools in the Far East, early 1990s. At the instigation of then- Middle East and Eastern Europe. In those Dean B. Joseph White, Ross School Pro- far-fl ung places, Michigan students would fessor Brian Talbot and a College of Engi- embark on the same sort of hands-on neering counterpart formed the Michigan learning that TMI students have under- Joint Manufacturing Initiative (MJMI), taken in the United States. which admitted its fi rst students in the “Students see the global change. fall of 1993. Tauber was so enthused Th ey’re plenty smart at Michigan; they’ve about the program that he committed fi gured that out. Th ey want an opportu- $5 million to support it — transforming nity to go work in China. A guy who MJMI into the Tauber Manufacturing speaks Chinese, has an MBA and an engi- Institute. neering degree — he’s going to be pretty “In a quiet, non-arrogant way, Joel had popular out there. an aspiration to greatness that he fol- lowed through on,” says Dean Robert J. Dolan. “He saw something that could TMI John Deere team members, left to right, happen that would be very special, and he Jens Nielsen, ME ’07, Karen Putterman, MBA/ didn’t cut any corners. He saw that TMI MS, ’07, and Caroline Conway, MBA/MS ’08, was going to have to include both the worked this summer on a supply chain initiative business school and engineering. It was to deliver seeding machinery components to going to need practitioners on advisory Russia. The team, shown here in front of St. Basil’s boards. And it was going to take a signifi - Cathedral in Moscow, presents its summer project cant amount of money. And he wasn’t at Spotlight! on September 15 in Ann Arbor.

dividend 19 fall 2006 “It’s a major change that will make a and done some dramatic things like we’re “Th e kid that runs my largest business, huge diff erence. It’ll change the whole doing in Darfur now, it could have been I hired him out of Michigan — captain of nature of the institute. We’re thinking of diff erent. Maybe nobody will listen. Maybe the basketball team, Mark Lozier. Very changing it to the Tauber Global Manu- they will. But myself and my generation strong personality. Great leader. Early on, facturing Institute.” — we’re always going to speak out as Jews we had some confl ict in our relationship. In his 45 years in American industry, to make sure it never happens again.” And it’s evolved over time. It’s been, like, Tauber has seen hard evidence of the He had always been active in the aff airs 25 years, and we have a very close rela- proposition that success requires keen of his temple and the local Jewish commu- tionship now. We had an annual meeting attention to constant improvement. “Th e nity. But in the 1980s and 1990s, Tauber the other day where I made that point. I Japanese who came up with the Toyota stepped into much larger roles. He became said one of the reasons I was staying in

method — I was thinking about that the one of the key Americans who raised the business was that I care about Mark. other day,” he says. “How did we let them $1 billion to move 1.3 million Soviet Jews Th at’s very satisfying. come up with that? We dropped the ball to Israel and the United States. When the “Th e selfi sh part of my still staying there. Th e steel industry in the ’60s, the Jews of Ethiopia were put at risk amid active is keeping my mind sharp. I’ve auto industry in the ’80s, IBM in the ’90s political violence in 1991, he played an found that the mind needs exercise the — you think you have the right formula, even more active part. same way the muscles do, and I was afraid but you never do. “I went there and met them. We brought that if I went into the golf/gin-rummy “You have to be on the cutting edge all out 14,000 in one weekend. Th e Israeli mode, it would atrophy. Other people, it’s the time. What’s new? What can I change? Air Force fl ew planes back and forth from great, that’s good for them. But not for my How can I make the future diff erent and Ethiopia in the middle of a civil war. Fab- makeup.” better? Living on the outer edge is not ulous story. And a very important part of Why does Tauber do so much to help comfortable because you make mistakes. my life.” others when he could kick back and pur- You have to be willing to accept that. But Back home, as president of the United sue personal pleasures? if you keep yourself on the cutting edge, Jewish Appeal, he worked to consolidate “I’ve asked that question of myself. then you’re always ahead of the game.” all the major Jewish organizations into It’s very hard to say. A lot of my friends a single organization, an eff ort he now spend a lot of time on the golf course. regards as “huge, unpleasant and, I must I think they’re missing something. Play “A lot of my friends spend a lot of say, basically never reached its potential.” golf? I love golf. I played it for years. I Yet he remained heavily committed to gave it up fi ve years ago because it was time on the golf course. I think they’re Jewish causes, consulting with U.S. and just taking too much time, and there wasn’t missing something. Play golf? I love Israeli leaders and raising more money enough gratifi cation. Does it matter if I to assist the Ethiopian Jews. shoot 82 or 86? I mean, yeah, okay, that’s golf. I played it for years. I gave it “Because I had such an investment in nice. But as compared to ...? Th ey’re giv- up fi ve years ago because it was the Ethiopians and I didn’t like the way ing up something, in my view. You get they were being integrated into the main- tremendous internal satisfaction out of just taking too much time, and there stream of Israeli society, I got involved. helping others.” wasn’t enough gratifi cation. Does it But the heart of the money I wanted to see Gratifi cation comes in small ways and spent was in Israel, upgrading the status in unexpected moments. Not long ago, matter if I shoot 82 or 86? I mean, yeah, of the Ethiopians, because it wasn’t done Tauber was at a football game at Michigan okay, that’s nice. But as compared right. We know now how to do it right.” Stadium when a man in his 50s approached him and said, “I want to thank you.” He to … ? They’re giving up something, in hrough all of this, Tauber remained told Tauber that a scholarship from a my view. You get tremendous internal Tan active businessman. But here too fund set up by Tauber’s father-in-law had his incentive had shift ed from profi ts to helped him through Michigan. satisfaction out of helping others.” people. “But that wasn’t why I stopped you,” “Eight or ten years ago,” he says, “I the man said. “My son just graduated

decided, ‘Ah, I’ve made enough money from TMI and he was president of the n his mid-30s, Tauber visited the site of to do the things important to me.’ But I student organization.” Ithe infamous Nazi concentration camp always maintained a fi nger in my busi- “Th at just made me feel very good,” at Mauthausen, Austria, the mountain nesses — buying and selling, as a non- Tauber says. “Th at’s gratifying — to make town where tens of thousands of Jews and executive chairman — and that put me a little, teeny-weeny diff erence. Not a big political prisoners were worked to death in a position where they would come to diff erence. I know that. But in one person’s in rock quarries and tunnels. me and we’d discuss strategies.” life, maybe. And that’s pretty good.” “I made up my mind then that I was He consults oft en with his son Brian, always going to speak out,” he says. “I MBA ’92, JD ’92, who runs two of the James Tobin remembered from my youth, it was always, Tauber Enterprises companies, and Joel ‘Shh! Don’t talk about it! Don’t let anyone remains an active adviser to executives know you’re Jewish!’ In my view, that’s throughout the concern. “It keeps me one of the causes of the Holocaust. If young,” he says. “I’m thinking about people had spoken out more, had taken issues where I can make a contribution. stronger positions and united and marched Th at’s extremely gratifying.

dividend 20 fall 2006 Left to right, TMI Co-directors Robert Culver, Roman Kapuscinski and Yavuz Bozer anticipate increased demand for leaders trained in business and engineering.

Th e institute has broadened its scope in recent years to include all aspects of operations management and manufactur- ing strategy. “We’re extending the bound- aries,” explains Robert Culver, MBA ’75, TMI’s industry co-director and adjunct professor of business and engineering. “Our mission remains the same: to develop a new breed of executives with advanced capabilities in engineering and business management. But our defi nition of manufacturing has grown beyond the four walls of the plant and includes every- thing from product design, logistics and supply chain to production and even fi nance. We’re looking at the whole enter- prise,” says Culver, who joined the U-M in 2004 aft er retiring as a senior manager at Ford Motor Co., where he had worked for more than 35 years.

“Our defi nition of manufacturing has grown beyond the four walls of the plant and includes everything from product design, logistics and supply chain to production and even fi nance. We’re looking at the whole enterprise.”

“Because of globalization and the need to coordinate manufacturing processes resulting from increased fragmentation of production, fi rms will place high value on supply chain managers for the next 10 PHILIP DATTILO to 15 years,” predicts Roman Kapuscinski, the Goff Smith Co-Director of TMI and associate professor of operations and lobalization has given rise to 80 new students per year. Nationally management science at Ross. many challenges, but reports of known for its action-based learning and Operations people, by necessity, are G the death of American manufac- leadership components, TMI also brings becoming supply chain experts, says turing are premature, according to the together business and engineering stu- Kapuscinski. He cites the example of a co-directors and members of the Industry dents and faculty to develop solutions to small fi rm that supplies Gap clothing Advisory Board of the Tauber Manufac- manufacturing challenges. TMI-affi liated stores. Th e garments are assembled in as turing Institute (TMI). faculty members share this new knowl- many as fi ve countries. Because shipping In fact, predict the industry representa- edge in the classroom and in the wider and lack of coordination add to costs, tives, though some manufacturing activities business community. Kapuscinski predicts cheap, small items inevitably will move to lower-cost off shore When TMI was established in 1993 like clothing and toys will continue to be regions, demand for manufacturing leaders as a partnership of the Ross School, produced far from where they are sold, trained in business and engineering will College of Engineering and private indus- while more complicated and bulky prod- increase as a result of such globalization. try with the support of advocates like Joel ucts such as automobiles are likely to TMI, which currently places 100 percent D. Tauber, BBA ’56, JD ’59, MBA ’63, its be produced closer to the consumer. of the 45 to 50 students it graduates each goal was to give American manufacturing “Few countries are providing the kind year, plans to expand enrollment to 70 to a boost. of training people need to become supply

dividend 21 fall 2006 Left to right, TMI team members Jeffrey Zens, MSE ’06, Shilpa Maniar, MSE ’07, and Aram Mazmanian, MBA/MSE ’06, worked at Lockheed Martin Space Systems Co. in 2005 on a project to optimize and relocate warehouse functions. chain experts. We want to be the best in this fast-growing area,” says Kapuscinski. TMI grew out of the Michigan Joint Manufacturing Initiative (MJMI), which accepted its fi rst students in 1993. Tauber, whose major gift was responsible for the transformation of MJMI into TMI, recalls, “When I was invited to take over a manu- facturing business more than 30 years ago, I had to develop my own training program because what I learned at busi- ness school didn’t prepare me to under- stand the whole organization. I worked with people on the business side and manufacturing side and came to realize that a comprehensive approach was a much more eff ective way to prepare for Co-Director and professor of industrial ing the summer and presents its analysis this kind of business.” and operations engineering. Contributing of the problem and specifi c recommenda- Since TMI’s founding, more than 500 to TMI’s distinctiveness are its unique tions to the sponsor. In many cases, the University of Michigan graduates’ tran- summer team project internships and its teams actually pilot the recommendations scripts note their fulfi llment of TMI’s formal leadership development program. or begin the implementation process. In extra requirements in addition to their mid-September back in Ann Arbor, the master’s degrees in business or engineer- Team Projects students present their project fi ndings ing. Some students have earned degrees TMI’s 14-week team projects are a at the Spotlight! competition to an audi- in both business and engineering. learning experience not just for the stu- ence of students, alumni, faculty and Only two universities off er similar dents, but also for the faculty advisers and recruiters. At Spotlight! industry judges programs of this caliber: Massachusetts industry sponsors. A team of at least one evaluate each project’s scope, implemen- Institute of Technology’s Leaders for MBA student and one engineering stu- tation and impact as well as the team’s Manufacturing and Northwestern Uni- dent work with a company on a specifi c presentation skills. Th e top three teams versity’s Master of Management and problem. “We call it operations-related earn scholarship prizes totaling more Manufacturing. However, TMI stands consulting,” explains TMI Managing than $30,000. out from the competition, notes Yavuz A. Director Diana Crossley. Each team “Companies expect more from TMI Bozer, the Ford Motor Company TMI works at the corporate sponsor’s site dur- interns and, in turn, the TMI teams get considerable exposure. It is common for teams to present their eff orts to a vice president or even to the CEO,” Culver says. “Also, because each project has a faculty adviser from both business and engineering, students have the advantage of looking at projects from two dimensions.” Students gravitate toward projects that deal with strategic issues and have high value to the sponsor, says Crossley. “Students like the teaming aspect, espe- cially the opportunity to work with class- mates from diff erent backgrounds. Team projects also are an opportunity to learn about a corporation’s culture and the sector in which it operates.

Left to right, TMI Boeing 777 team members Wilfredo Durand, MBA ’07, Taoufi k El Khazzani, MSE ’06, and Vince Giovannetti, MBA ’07, stand in front of an engine, with cowls extended for testing. “We see a huge change in students between the beginning and the end of the TMI Alumni summer. MBA students, who usually are fi ve years older than their undergraduate Advise Students: engineering teammates, realize how much engineers contribute. Engineering

students, most of whom are in the Engi- Think Globally SCOTT GALVIN neering Global Leadership Program and come in with extremely high grade-point hink globally,” was the overriding averages, also gain an appreciation for the “Tmessage for students attending MBAs,” Crossley adds. the Tauber Manufacturing Institute’s It is not unusual for a TMI team proj- (TMI) fi rst alumni panel discussion held ect to save the sponsor $5 million or this spring on North Campus. more, she reports. First-place award Robert Bruning, MBA ’97, set the winners in 2005 were Isaac Jacob, MBA tone by expanding the day’s theme, “Th e ’06, and Stephanie Fidler and Kristen Future of U.S. Manufacturing,” to address Neubauer, both MSE ’06. Th e team the broader issue of global supply chain recommended a facility consolidation trends. As principal with PTRM Manage- plan and product realignment strategy ment Consultants, Bruning has consulted for Boeing–Commercial Aviation Services with 15 companies to assess and improve designed to produce annual savings ex- supply chain performance. ceeding $24 million in addition to a cash- “In the 1970s and 1980s, manufactur- ABOVE Left to right, Dean Degazio, Katherine fl ow improvement of over $90 million ing was seen as an isolated function. Since Pearce and Robert Bruning discuss global from a one-time inventory reduction. the 1990s, companies have moved toward supply chain trends at a TMI Student Advisory Working with Pfi zer Inc., another TMI integrating the four elements of plan, Board-organized program attended by John team demonstrated how to incorporate source, make and deliver under a single Adams, MSE ’06, center, and classmates in traditional manufacturing disciplines in a umbrella,” he explained. the photograph below. nontraditional production environment, Global trends have forced companies increasing the eff ective capacity of the to change from a transactional focus — “As far as we know, Beaumont is the pharmaceutical giant’s so-called “kilo” lab effi ciency — to a strategic focus. Th ese fi rst hospital in southeast Michigan to facilities by more than 20 percent without trends include increasing supply chain hire industrial engineers in its informa- signifi cant capital expenditures. complexity, the need for collaboration tion technology department,” she said. Last summer two teams — one assigned with suppliers and customers, customer Th e IEs were brought in to review the to Intel and another to Dell — worked fragmentation, and pressure to manu- transition to new soft ware throughout together on a supply chain project for the facture and price things more cheaply, the hospital, with the goal of matching two fi rms. Another TMI team worked Bruning said. departmental processes to the soft ware, with fi rst-time sponsor John Deere on a “Increasingly, organizations view the rather than necessitating costly soft - supply chain initiative to deliver seeding supply chain strategy as an executive-level ware changes. machinery components to Russia, a issue,” he added. “Supply chain strategy “Our goal is zero customization,” daunting task because the assembled impacts many levels of performance, Pearce said, calling the engineers “a equipment is too large to ship. whether you are competing on innova- bridge between the technical resources Faculty members like Kapuscinski fi nd tion, cost, quality or speed-to-market.” and the end users.” that team projects provide eff ective illustra- Dean Degazio, MBA/MEM, ’99, lead All three speakers emphasized an tions to use in their own classes — real-life engineer with General Motors Corp., abundance of opportunity for TMI situations to which students can relate. also noted ways in which the manufac- graduates. “Many companies we work “TMI projects are sophisticated. Th e an- turing industry is changing and evolving. with are reactive. Th ey contact us swers are not always obvious, so they also “Wage gaps (between American and when they encounter problems, such as become a good source of research ques- overseas workers) persist, but skill gaps shrinking markets, loss of customers or tions,” adds Kapuscinski. A 1999 project in production labor are closing rapidly. huge warehouses of unsold inventory,” for Dell inspired a study that focused on Places like India are more than capable of Bruning said. “Or perhaps they have savings through online pricing. doing design work. Th e General Motors just merged with another company and Bozer says serving as TMI project ad- car being built in Canada has parts that need to integrate their operations. We visers helps faculty members build rela- are made all over the world. No matter are encouraging companies to become tionships with industry more quickly than where you work,” he told the approxi- more proactive as they look at supply they might on their own. Th ese contacts mately 60 students, “you will be dealing chain strategies. can lead to case studies and sometimes with global issues.” “Th e supply chain is the way you get consulting relationships. “Th e companies And Katherine Pearce, MSE ’03, a your products from your suppliers to want these projects to be successful. We business operations analyst with Beaumont your customers. It has a huge impact have deliverables and are able to apply Hospitals, illustrated that opportunities on how customers perceive the overall knowledge in creative ways,” says Bozer. for TMI graduates extend beyond tradi- performance of your company,” Bruning tional manufacturing companies. concluded. Pat Materka

dividend 23 fall 2006 Alcoa’s Allison Allgaier Pursues Passion: Operations and Strategy

ome mid-September, you’re likely to Bettendorf, Iowa, Allgaier does “lots of Cfi nd Allison Allgaier, MBA ’01, in number crunching.” In her third position Ann Arbor. Th e draw for Allgaier is the at Alcoa, she analyzes aerospace customer annual Spotlight! competition in which data to predict where the market is going teams of University of Michigan business and develops integrated supply chains. care Corp. in Dallas that Allgaier realized and engineering students present their Shortly aft er graduation, Allgaier joined “operations are my passion.” summer intern projects to panels of in- Alcoa as a manufacturing specialist, work- She recognized that she needed to build dustry experts who serve as judges. Top ing with departments to develop and her credibility to change careers success- teams win thousands of dollars in prizes. implement lean manufacturing initiatives. fully. “TMI was one of the reasons I chose “Spotlight! is my favorite excuse to In 2002, she was promoted to general Ross. I was looking for a school strong in come back. It is fascinating to see the supervisor. Her responsibilities included operations and international business,” high quality of the projects. I’m always overseeing daily operations and strategic recalls Allgaier, who speaks Cantonese impressed,” says Allgaier, whose team direction for fi ve production centers. In and Mandarin and served two years as a won fi rst place in 2000 for a project spon- addition to developing new safety programs, Church of Jesus Christ of Latter-day Saints sored by the Copeland Corp. She and her Allgaier led process-improvement eff orts missionary in Hong Kong. Tauber Manufacturing Institute (TMI) that resulted in a 25 percent productivity TMI and other action-based learning teammates developed and implemented a increase in two of the production centers. opportunities — including a Multidisci- leaner global supply chain for Copeland, “I really get satisfaction from making plinary Action Project in which her team which manufactures air-conditioner things and solving problems,” comments recommended what maintenance work compressors. Allgaier, who worked in healthcare before DTE Energy should outsource — equipped Today, as the services manager for enrolling at Ross. It was while negotiating Allgaier to be a leader in operations and aerospace marketing for Alcoa Inc. in managed-care contracts for Tenet Health- strategy at Alcoa.

LeadershipAdvantage individual leadership characteristics. who can contribute toward a successful TMI’s structured emphasis on leader- Many of the modules stress communica- summer project.” ship through its LeadershipAdvantage tion and teamwork. In one module, “Th e In another session titled “Leading Up, program is one of its strongest selling Pit Crew Challenge,” randomly assigned Down and Sideways,” students learn what points, according to students. Th e pro- teams learn to change tires on a NASCAR it takes to manage relationships with gram, a series of modules required of all race car. Teams practice once and then subordinates, peers and bosses. Other fi rst-year TMI students, consists of 16 compete with other teams in timed trials. sessions focus on a range of topics, in- workshops taught by faculty from both Students learn to understand the ele- cluding how to conduct business and dine schools and outside consultants. ments of eff ective teamwork: goals, roles, at the same time, value stream mapping During the fi rst semester, TMI students responsibilities, interpersonal relation- and Six Sigma. complete a personal assessment that ad- ships and team processes. dresses team leadership interaction and Vincent Giovannetti, MBA ’07, who Academics participated in the Pit Crew Challenge in All TMI students enroll in an inter- January, recalls, “Most teams saw marked disciplinary course called “Topics in improvement from each run to the next, Manufacturing.” Kapuscinski coordinates mostly as a result of improved techniques the survey course, which covers every- and strategies. Th e most poignant moment thing from general business strategy, came when the professional pit crewmen operations strategy and lean manufacturing reminded us that they could have served to issues related to product design, environ- as valuable resources for advice about the mental concerns and ethics. Th e three- optimal processes.” Jolted by the profes- hour sessions are taught by faculty and sional crew’s candor, Giovannetti noted, industry experts. For example, William “It is unlikely that TMI students will fail Lovejoy, the Raymond T. Perring Family to identify and network with anyone Professor of Business Administration and chair of operations and management Left to right, TMI students Ryan Rindler, MSE science, teaches “Integrated Operations.” ’07, and Karan Seth, MSE ’08, learn the fastest Students learn about environmental issues way to change race car tires from Track Time from Steven J. Skerlos, assistant professor of Driving Schools’ Garett Kern in preparation for mechanical engineering, who designed a the Pit Crew Challenge. cell phone that disintegrates a few years aft er

dividend 24 fall 2006 it is discarded, thus saving landfi ll space. Employers like the fact that TMI gradu- Intel Corp. and a member of the TMI TMI also has helped develop electives ates can hit the ground running and make Industry Advisory Board, attracting TMI that integrate engineering and business immediate contributions to the business,” grads to Intel is a strategic goal. He keeps concepts: “Integrated Product Develop- Crossley says. in touch with TMI students throughout ment,” which was featured in the spring Th omas Beddow, 3M’s staff vice presi- their time at Michigan — both those who Dividend, “Reconfi gurable Agile Manu- dent of public aff airs and government intern at Intel and others he meets at TMI facturing,” “Manufacturing and Supply markets and president of the TMI board, events. As a result, reports an exuberant Operations” and “Sustainable Manufac- says, “3M really values TMI graduates. Kellso, “We had a very good recruiting turing.” Making the TMI experience truly You can hire an engineer, but an engineer year — we hired fi ve TMI grads!” cross-disciplinary, all business students with business skills is even better.” To learn more about TMI, visit are required to take some courses through For recruiters like James R. Kellso, www.tmi.umich.edu. the College of Engineering and engineer- manager of supply network research for Mary Jo Frank ing students must take a certain number of business courses. Life after TMI TMI Alum Guides Life Fitness Many MBA students come to the Ross School interested in fi nance, marketing or consulting, notes Kapuscinski. Th ose Manufacturing Strategy who plan to go into consulting realize that in many cases consulting is opera- s senior manager of manufacturing tions, information technology and process Astrategy for the exercise equipment improvement. TMI provides the broad fi rm Life Fitness (a Brunswick company), experience they need, he says. Mario Noble, MBA ’04, strives for lean. It is natural, then, that TMI graduates “My role is to infuse best practices tend to gravitate toward larger fi rms from industry, such as lean manufactur- like Dell Inc., Alcoa Inc., Intel Corp., ing and regional manufacturing, to help Ford Motor Co. and the Boeing Co., transform Life Fitness into a world-class where they are tapped for “fast-track” manufacturing company,” says Noble, general-manager development programs, who lives and works in Chicago. “Most management positions in operations or of my projects focus on the future, whether manufacturing, and as strategy and plan- it is building a lean culture or using ning analysts. TMI graduates also are discounted cash fl ow to determine the highly sought aft er by leading consulting optimal manufacturing footprint for fi rms, including McKinsey & Co. and the company.” Mario Noble pumps iron on a Hammer A. T. Kearney. Of TMI’s spring 2006 It’s an ideal job for Noble, a fi tness buff Strength Iso-lateral bench press. graduates, almost 70 percent took jobs and fan of Life Fitness’ durable, ergonomi- with manufacturing fi rms, 23 percent cally friendly machines. As a student, joined consulting fi rms and the remain- he worked out regularly at the U-M’s change management project at General ing graduates opted for positions in the Central Campus Recreation Building. Cable in Marion, Indiana, and a seven- service industries. Life Fitness also owns Hammer Strength, week Multidisciplinary Action Project “Th ese fi rms highly value the multi- the maker of heavy-duty training equip- working on a market entry strategy for disciplinary education and team project ment used by Wolverine varsity athletes Ardesta LLC of Ann Arbor. experience obtained by TMI students. and pro teams. “Th e TMI intern experience, includ- Noble, who earned a bachelor’s degree ing faculty support from business and Left to right, TMI students Elizabeth Hold- in materials science and mechanical engineering , helped me leverage the sworth, MSE ’07, Rahul Deshmukh, MBA ’07, engineering from the University of experience of experts to learn and accom- and William Chen, MSE ’06, worked on a California-Berkeley, was attracted to plish a lot in a short amount of time.” materials management project at the Boeing the Ross School by the Tauber Manufac- TMI’s LeadershipAdvantage Program 737 manufacturing facility. turing Institute (TMI) and the school’s also gives students a leg up once on the team-oriented approach to learning. job, says Noble. For him, the most “Ross has a reputation of fostering an valuable session was a day-long class environment that encourages people to taught by Michael Rother, author of work together and learn from one another. Learning to See, about lean manufac- People who attend Michigan tend to be turing. “Rother taught me that imple- team oriented and willing to share in- menting lean manufacturing involves formation. A good team can accomplish a culture change as well as a process more in the long run than a high-pow- change. Th e lessons I learned about the ered individual can,” says Noble. His importance of culture made the diff er- Ross team experiences included a ence between success and failure in the 14-week TMI lean manufacturing and projects I have worked on since.”

dividend 25 fall 2006 What We Talk About When We Talk About

n 1972, President Richard Nixon billion people live in countries now open became the fi rst U.S. president to to American products and services. “ONCE A CONSUMER HAS visit the People’s Republic of China. “Th ere are a lot more consumers, whether When his historic visit had ended, you are Microsoft selling soft ware or the GOTTEN USED TO A Nixon had cracked the bamboo University of Michigan off ering MBA curtain, which had closed commu- degrees,” says Robert Kennedy, executive BREAKFAST OF MUESLI FROM Inist China to the West for decades. director of the William Davidson Insti- Th e immediate impact was an easing tute and professor of business administra- SWITZERLAND, APPLES FROM of U.S.-China tensions. Th e long-term tion at the Ross School. “Th ere are also a impacts are being felt now — an open lot more competitors.” NEW ZEALAND AND FRENCH door for American fi rms hoping to do If you roll back the clock to the 1960s, business in the world’s most populous globalization as we now know it did not CHEESE, IT WOULD BE VERY market, and a massive and growing U.S. exist. “Back then,” Kennedy explains, “what trade defi cit with China. Th ere is also con- we think of as the global economy was DIFFICULT TO GO BACK TO siderable political fallout for U.S. elected really the U.S., Western Europe, Japan offi cials who must contend with angry and a few tiny outposts such as Singapore. THE OLD DAYS. AND THAT workers who feel they can’t compete with Most other countries were engaging in cheap Chinese labor. minimal global commerce. Th ey were WAS JUST BREAKFAST.” Welcome to the era of globalization. trying to do it on their own. Th ey were Some people condemn globalization the equivalent of 19th-century America. factories. Th e reality, again, is more com- as one of the great evils of our age. Some Th ey grew their own food. Th ey made plex. “From the macroeconomic view, praise globalization as a ticket to economic their own candles. globalization is almost entirely positive,” prosperity. Who’s right? “Since then,” Kennedy relates, “the Kennedy says. “We get cheaper goods, we One reality is that American workers are percentage of people living in countries get goods faster and it keeps infl ation down. losing their jobs to China, Mexico and a open to the global economy has gone “Th e negative from globalization is that lot of other places. Another reality is that from around 22 percent in 1980 to more it imposes fairly high costs on some indi- U.S. unemployment is below 5 percent, than 75 percent today.” viduals, the people who are displaced. In more than two percentage points below To the critics, this has been a disaster. the aggregate, the gains are much better the average since 1960. Yet another reality Th ey point to the loss of millions of than the losses. In globalization everyone is that more and more of the world’s six American industrial jobs and shuttered gains a little bit, but a few people lose a lot.”

dividend 26 fall 2006 “INGLOBALIZATION EVERYONE GAINS A LITTLE BIT, BUT A FEW PEOPLE LOSE A LOT.”

Free Trade Fosters Trade Defi cits: of America’s global trade defi cit, the China Interdependence Behind the Numbers part has soared.” More to the point, globalization can’t Still, there are statistics that make many Critics also claim that America’s manu- be undone. Free trade has created inter- voters wonder if free trade is a good idea. facturing might is withering under Chinese locking, interdependent economies in One of them is the U.S. trade defi cit with competition. Th e reality is that America is which countries increasingly specialize China, which hit nearly $202 billion in losing jobs to China. But it’s also true that in what they do best, and leave the rest 2005 and is likely to grow. Once again, America’s manufacturing output has grown, to someone else. In this economic regime, the absolute numbers are misleading. not shrunk, and that the United States con- the U.S. produces some of the world’s best China, it turns out, serves as a center for tinues to far outpace airliners, but makes less and less of the fi nal assembly for products of component China in total output. clothes it wears. Were trade to end, the parts made elsewhere in Asia. “What you fi nd is U.S. would be ill-equipped to try to clothe “Th e reality is that China imports that the U.S. has in- its people. Developing countries would high-value-added parts and components creased its share of be unable to build their own aircraft . from Japan, South Korea, Taiwan, Hong total global manufac- Moreover, many products are multi- Kong and Singapore, then adds value in turing in the last 15 national composites, made up of compo- fi nal assembly and shipping,” says Kenneth years,” Lieberthal re- nents from two or more countries. Among G. Lieberthal, a specialist on China and lates. “China also has them is Boeing’s new 787 airliner. Its com- the William Davidson Professor of Inter- increased its share. ponents come from the U.S., the United national Business. Th ey’ve gone from Kingdom, Italy, Australia and Japan. Close So it’s more useful to look at all of Asia 2 to 6 percent of global down trade, and the 787 assembly line to see whether the U.S. trade shortfall manufacturing output. would grind to a halt. with the region is growing faster than the But we’ve gone from 22 Since nations are now dependent on overall trade defi cit. “Th e Asian portion to 24 percent. We pro- Kenneth G. Lieberthal one another, there are powerful incentives of America’s global defi cit is actually duce the high-technol- not to capsize the boat. “India cannot be smaller now than it was 20 years ago,” ogy, high-value-added products. Th ey a closed economy as it was for 45 years says Lieberthal. “But within Asia’s portion produce the low-technology products. And following its independence from the Brit- ish,” says Bharat Patel, MBA ’69, retired chairman and managing director of Procter & Gamble India, and currently its non-executive chairman and consultant. U.S.- China Trade at a Glance “Only aft er its slow but gradual move toward a market economy and globaliza- Chart shows the rapid growth of Chinese exports to the U.S. versus the slow growth tion has the Indian economy started of U.S. exports to China. growing at over 7 percent a year. Before 250 that, it had been growing at just 3 to 4 U.S. Imports from China percent a year.” . Th en there is the matter of consumer U.S. Exports to China preference. “Once a consumer has gotten 200 used to a breakfast of muesli from Swit- zerland, apples from New Zealand and French cheese, it would be very diffi cult 150 to go back to the old days,” says Krishna Ramanathan, MBA ’93, head and direc- tor of Sara Lee Apparel in India. “And Billions of dollars 100 that was just breakfast.”

Robert Kennedy 50

0 ’96 ’97 ’98 ’99 ’00 ’01 ’02 ’03 ’04 ’05 Source: U.S. Census

dividend 27 fall 2006 10TH CENTURY 1876 Alexander Graham Bell patents the Benchmarks Chinese develop gunpowder for use in telephone. fi reworks. 1891 Ellis Island opens to process immigrants in the 13TH CENTURY arriving in the U.S. Marco Polo travels to China. 1896 First modern Olympic games held in Athens. History of 15TH CENTURY 1901 Radio pioneer Guglielmo Marconi sends Johannes Gutenberg’s invention of movable fi rst trans-Atlantic wireless signal. Globalization type makes printing easier and cheaper, spurring an early information age. 1903 The Wright Brothers complete the fi rst powered fl ight. 1492 Christopher Columbus lands in the New World. 1913 Henry Ford introduces the moving assembly line for automobile production. 1775 The American Revolution begins. 1914 Panama Canal completed, greatly 1844 First intercity telegraph line opens. shortening east-west shipping routes.

our manufacturing output is four times schools such as the University of Michigan. cally collapsed. Th e problem: Globalization China’s manufacturing output. So has the Globalization also creates jobs for inevitably produces losers as well as win- U.S. lost its manufacturing competitive- Americans outside the U.S. as American ners, and the losers are beginning to exert ness? Absolutely not.” multinational corporations set up out- political muscle in their home countries. How has the U.S. become an even posts. Th is represents a quantum shift for Aside from trade friction, economies are bigger manufacturing dynamo while many companies, which had minimal, if at risk from any number of disruptions, shedding millions of jobs? “Our produc- any, foreign presence just a few decades including natural disasters and wars. A glob- tivity has gone up dramatically in the past ago. “When I joined Pricewaterhouse- al pandemic would devastate global trade 15 years,” Lieberthal says. “Generally, Coopers in the early 1980s, American because many nations would simply shut productivity improvements are good for companies that behaved as global compa- borders in an attempt to keep disease out. an economy. But productivity improve- nies were few and far between,” says Chris If globalization were to somehow shift ments also mean you need to pay atten- Cooper, BBA ’88, MAcc ’88, Beijing- into reverse, it could have stiff conse- tion to a reasonable exit for those who based partner in charge of mergers and quences, turning the earlier winners into lose their jobs because of it. So we need to acquisition for the company’s China desk. losers and possibly igniting infl ation. continue to focus on our manufacturing “Our fi rm started going more global in “Economists would tell you that prices excellence and at the same time take care the 1990s as our clients started to become would go up,” says Cooper. “Consumers of workers who lose their jobs.” more global.” would immediately feel the pinch if places For fi rms like PricewaterhouseCoopers, like Wal-Mart and Target were not able Creating New a global presence is not optional. “Th e to source products from foreign markets. Jobs and Wealth only way to enter new markets or to pro- Th is would create a negative wealth eff ect Th e hope, of course, is that globaliza- tect existing markets is to be present in immediately. It also would be a very inef- tion also will create jobs and wealth, and foreign locales. You have to be present fi cient use of American capital to divest lift the fortunes of nations rich and poor. to understand how business is done, how overseas and reinvest in the U.S.” In the U.S., one obvious place to look for investments are done, how marketing and job creation is the West Coast, where branding is done and how distribution Risks and Rewards for ports are handling the rising tide of im- to markets is done. Firms with a Global View ports from the East. Indeed, they have “As the U.S. becomes more of a service- As a practical matter, anything that been on a hiring binge, adding thousands based economy, globalization should be disrupts trade cuts both ways. U.S. ex- of dock workers to a good thing for our economy. And the ports exceeded $818 billion in 2004, and unload cargo. Th ere is fi nancial sector has a huge role to play the U.S. is in fact a larger exporter to the also a huge national in the globalization process. So these are world than China or Japan. Th e U.S. infrastructure of offi ce exciting times,” says Cooper. is second only to Germany, which had workers, warehouse exports of more than $912 billion in 2004. workers, truckers and Globalization Produces Huge numbers of American companies so on who owe their Winners, Losers would suff er if the trade spigot were to jobs to trade. And it’s Th e huge shift s that globalization has close. One of them is AFB International, oft en forgotten that wrought haven’t taken place without contro- which supplies pet food fl avorings made trade also consists of versy. Th ere have been anti-globalization from chicken livers to pet food and treat services as well as fac- protests in the U.S., South America and makers around the world. tory goods. Foreigners Europe. A skeptical Congress only nar- One market is China, says Jacquelyn buy Disney movies. Th ey rowly passed the latest U.S. free-trade Levin, MBA ’87, the company’s president come to America for legislation, the Central America Free and CEO. Chinese companies import AFB’s medical treatment. Th ey Trade Agreement. And the latest round American-made fl avorings to make its pet Chris Cooper send their children to of global trade talks in Doha, Qatar, basi- treats attractive to animals. Th ough the

dividend 28 fall 2006 1927 Aviator Charles Lindbergh lands in Paris to 1970s Personal computer sales, led by Apple 2000 The fi rst crew — one American, two complete fi rst non-stop trans-Atlantic fl ight. Computer’s innovative low-cost PCs, Russians — arrives on the International begin to take off. Space Station. 1939 Germany invades Poland to start World War II. 1972 President Nixon travels to China, 2001 Terrorists attack the World Trade Center and opening a crack in the bamboo curtain. the Pentagon, spurring the War on Terror. 1945 United Nations founded. 1973 Oil embargo and fast-rising petroleum 2006 Bird fl u spreads rapidly through Asia, 1950s Television becomes a fi xture in millions of prices trigger economic shockwaves and Africa, the Middle East and Europe. homes. Rock and roll music changes illustrate the world’s dependence on oil. American youth culture and begins to 2006 Immigrants stay off the job on May Day spread around the world. Also, cheap, 1989 Berlin Wall demolished as the Cold War to demonstrate their importance to the effi cient container shipping method comes to an end. U.S. economy. introduced, spurring trade. 1990s The Internet comes of age. 1958 The U.S. creates the Defense Advanced 1994 The North American Free Trade Agree- Research Projects Agency, or DARPA, ment between the U.S., Canada, and which paves the groundwork for the Mexico takes effect. Internet.

Chinese raise huge numbers of chickens, which gives us a competitive advantage.” Another diff erence — some markets they eat the chickens — lock, stock and Like many companies, AFB is at the are periodically wracked by violence. liver. And so they generally don’t make mercy of an import no one wants, the “Bombings happen in Israel,” says Saul. the fl avorings themselves. Th at leaves the bird fl u. “We only get chicken livers if “Th at’s a market I go to. Domino’s has door open to AFB. poultry is slaughtered,” says Levin. “If more than 20 outlets there.” At the moment, China is a small mar- people get nervous about getting avian Religion is sometimes a factor in the ket for AFB because it makes very little infl uenza and won’t eat chickens, then workplace. “We just opened a store in the pet food for domestic use. Many Chinese there won’t be enough livers for us. If that Republic of Ireland and had don’t have pets. Th ose who do tend to feed were to happen, we would have to use a party to mark the opening,” them table scraps. But China is changing. other proteins for fl avoring, such as fi sh. Saul relates. “Th e Catholics “Over the long haul, it will be a very large Th e problem is that dogs and cats like sat at one table, the Protes- market for us,” says Levin. “Th e real ben- chicken, and other protein sources oft en tants at another, and the man- efi t will be when China views animals as aren’t as cheap.” ager, a native of India, sat in To operate in this world the middle between them.” requires fi ne-tuned busi- Th is is the stuff of every- ness skills. It also requires day life, along with a lot of the ability to get along in jet travel and a haphazard other cultures and, some- sleep schedule. “When you’re Laurence Saul

MARY BUTKUS MARY BUTKUS times, the ability to nego- on a plane for 22 hours, it’s tiate in environments hard to perform,” says Saul, who is based that may be hostile, if not in Amsterdam. “And my day does not end outright hazardous. at six o’clock. My day ends when America “It takes a certain per- turns off the lights. I’m still getting calls sonality to do this job,” into the middle of the night. Th at’s okay. says Laurence Saul, MBA Th at’s my job.” ’03, vice president of Such is life for the foreign executive; and Domino’s Pizza Interna- as time passes, more and more Americans tional with a territory can expect to fi nd themselves in this role. that includes Europe, the Th at’s where their companies’ futures lie. Middle East and Africa. “Around the world, Domino’s has 8,000 “Th ere have been guys stores,” Saul notes. “About 3,500 of them Jacquelyn Levin from the U.S. who can’t are in international markets. It’s where function abroad where it’s most of the growth is coming from. members of the home. Th en they’ll go to more fl uid, faster and more fl exible. Th e “Th e world is global now. It’s just that low-end pet food and eventually to high- business model overseas won’t be 100 some organizations don’t know that yet. end pet foods. Th at’s 15 to 20 years down percent diff erent from the U.S.; it will be Th ere are still some trade barriers. But the road.” 15 percent diff erent. But the diff erences those are going to be pulled down. Every- And China is just one piece of AFB’s will be dramatic.” thing has changed. It’s really changed.” profi table foreign market. “Our company One immediate diff erence is the multi- Doug Mcinnis likes global business because it tends to tude of cultures, sometimes within the same be more profi table,” Levin says. A second country. “Switzerland is still both French advantage: “As we’re exposed to other and German,” he notes. “You’re in the economies, we learn about new ingredi- same country, but you have two distinctly ents that might go into our fl avorings, diff erent consumers with two languages.”

dividend 29 fall 2006 ASHESH SHAH

Bharat Patel, left, and The View from Mumbai Krishna Ramanathan

hen we read about globalization, the U.S. dollar is supported by funds from “India is at a juxtaposition where it is it’s usually presented from an Japan, China, Russia, India and others, hauling itself up by the bootstraps into W American perspective. which are invested in U.S. Treasury Bonds. the 21st century. As a result, it’s possible But there are many others, depending “Globalization has to continue and move to see fascinating contrasts. For example, on where you live. Here are two views of faster because it is the only way economic India has one of the best cell phone net- globalization from Ross School alumni and social progress will happen in the works in the world, and it is not uncommon Bharat Patel and Krishna Ramanathan, world. But there must be much more give to see a farmer riding a bullock-cart while both of whom have worked for large from the ‘have’ nations so that the ‘have- using the latest cell phone. American multinational corporations. not’ nations benefi t quickly. For example, “Mumbai, where we live, appears to Th ey are based in Mumbai, India’s fi nancial protection of the agriculture sector by the have become one big construction site and fi lm-making center and home to developed world is hurting farmers of the with numerous high-rises coming up and 14 million people. developing world. In India, nearly two- most roads being dug up for re-laying. Bharat Patel, MBA ’69, retired chair- thirds of the population depends on agri- Th is of course results in terrible traffi c man and managing director of Procter culture, and the worst off among them are jams. One of the truisms about Mumbai & Gamble India, now its non-executive non-land-owning agricultural laborers is that you measure distance not in kilo- chairman and consultant, talks of the need whose daily income is less than $2.” meters or miles but in the time it takes to for globalization and the consequences of Krishna Ramanathan, MBA ’93, head get from point A to point B. reversing course. and director of Sara Lee Apparel in India, “Malls, restaurants and multiplexes are “If you were to slow down globalization, describes India’s phenomenal growth. mushrooming all over the country. In my it would slow economic development, “Many developing countries are growing opinion, this is one of the most exciting particularly in emerging economies like rapidly and present attractive markets. and dynamic places to live at this time. India. India’s most profi table growth sec- For example, India currently has a GDP Aft er all, how oft en does one get to see an tors include IT services, pharmaceuticals growth rate of 8 percent and China has entire nation wake up and try to make and engineering goods. Most of the growth been growing at 9 percent a year for the itself over almost overnight?” markets in those sectors are outside India. past 15 years. Th is translates into increas- “I believe that U.S. consumers are de- ingly affl uent consumers who are also Doug Mcinnis pendent on low-cost goods from China and brand-aware and brand-friendly thanks low-cost technical services from India. And to global media.

dividend 30 fall 2006 A Tale of A Truly International Two Economies Student Body A STATISTICAL SNAPSHOT Th is chart profi les the Ross School student body by country of origin he United States has the world’s India is fast becoming a technology in Fall 2005. Tbiggest economy and is a technologi- power and has an economic growth rate cal powerhouse. India is still heavily more than twice that of the United States. Argentina 4 grounded in agriculture, which employs Below are a few points of comparison. Australia 1 roughly 60 of every 100 workers. But Bangladesh 3 Belgium 1 Bosnia and Herzegovina 3 Brazil 21 Bulgaria 3 Canada 47 Chile 1 China, People’s Republic of 183 Colombia 1 Denmark 2 Egypt 1 England 4 France 9 Germany 4 Greece 2 Hong Kong 21 India The U.S. Hungary 1 India 319 Area: 3,287,590 square kilometers Area: 9,631,420 square kilometers Indonesia 7 (slightly more than one-third the Israel 6 size of the U.S.) Population: 298 million Italy 7 Jamaica 3 Population: nearly 1.1 billion Economic growth rate: Japan 47 (more than three times the population 3.5 percent (2005) Jordan 1 Korea (South), Republic of 87 of the U.S.) Lebanon 1 Industrial production growth rate: Malaysia 4 Economic growth rate: 3.2 percent Mexico 10 7.7 percent (2005) Mongolia 1 Labor force: 149 million (less than Netherlands 1 Industrial production growth rate: 1 percent are employed in agriculture, Nigeria 2 8.2 percent 23 percent are employed in manufac- Pakistan 9 turing, extraction industries, transpor- Peru 15 Labor force: 496 million (60 percent tation and craft s) Philippines 1 are employed in agriculture) Poland 5 Republic of Armenia 1 Population below poverty line: Republic of Belarus 1 Population below poverty line: 12 percent (2004) Republic of Croatia 2 25 percent (2002) Republic of Georgia 1 Imports: U.S. imports include agri- Republic of Latvia 1 Imports: India’s imports include crude cultural products, crude oil, industrial Romania 4 oil, machinery, gems, fertilizer and supplies, computers, telecommunica- Russian Federation 13 chemicals. tions equipment, automobiles, clothing, Singapore 26 medicine, furniture and toys. South Africa 1 Exports: India’s exports include Spain 4 textiles, gems and jewelry, engineering Exports: U.S. exports include soybeans, Sudan 1 Switzerland 3 goods and chemicals. fruit, corn, chemicals, transistors, Taiwan, Republic of China 21 aircraft , computers, telecommunica- Thailand 7 tions equipment, automobiles and Turkey 13 medicines. Ukraine 2 United Kingdom 8 SOURCE: CENTRAL INTELLIGENCE AGENCY WORLD FACT BOOK United States 1841 Yugoslavia 1 (blank) 1 Grand Total 2790 dividend 31 fall 2006 C LEE/PHOTOLINK

hen Adam Percy, BBA ’07, incredible would be a complete under- 16 schools had sent a large group of heard about an opportunity to statement,” he said. “We all came away undergraduates to complete the course. W spend a week in Washington with a much better understanding of Professor George J. Siedel, who serves exploring the relationship between govern- Washington as a whole, but with a thou- on Th e Washington Campus board of ment and business, he knew he had to sand new questions we never would have directors and teaches the class there on jump. Aft er all, it’s not oft en that under- thought of if we hadn’t taken the course.” federal courts, felt that the course could graduates get to see how abstract concepts Operated by a consortium of 16 busi- benefi t undergraduates as much as MBA they’ve studied in class — fi scal policy, ness schools, including the Ross School students. “It’s just as important for under- regulation, banking — play out in the daily of Business, Th e Washington Campus runs grads to understand the public policy pro- life of the nation’s capital. And for Percy, intensive courses that feature speaker whose interest in public policy almost lineups of past and present government edged out business as a major, the subject offi cials and other professionals who have LEFT Jodie Fennelly, left, and Angela Bell take a matter was compelling. So in May, fresh spent their careers in D.C. Th e goal is to break on the steps of the Supreme Court Building. from fi nals, Percy joined four dozen other foster understanding of the federal gov- MIDDLE Professor George Siedel introduces David BBA students who boarded a bus early ernment’s decision-making process and Carson at The Washington Campus’ opening one Saturday morning for the nine-hour its impact on business, and to encourage session. drive from Ann Arbor to Th e Washington business leaders to participate in that RIGHT Ross School BBA students sing “Happy Campus in D.C. process. Th e courses have been off ered Birthday” to L. William Seidman, MBA ’49, Aft er a jam-packed week of classes, to MBA students, with whom they’ve founder of The Washington Campus. Washing- lectures and meetings, Percy returned with proven hugely popular, since 1978. But ton Campus staff member Courtney Madden his head bursting. “To say it was absolutely this spring was the fi rst time any of the joins in the celebration. EILEEN COLTON

dividend 32 fall 2006 EILEEN COLTON

cess, especially undergrads of the caliber we In Carson’s view, the earlier business ABOVE Tim Hodes thanks David Carson for his have at the University of Michigan, who students are exposed to the workings of support of the Carson Scholars program. Carson are very bright and sophisticated,” said Washington, the better. “Th e ability to be talked with students about the public policy Siedel, the Williamson Family Professor involved in public policy defi nes our demo- process. of Business Administration and professor cratic society,” said Carson, former president of business law. “We expect these students and CEO of People’s Bank in Bridgeport, diverse as automobile insurance rates and to assume leadership roles in business.” Connecticut. “Businesspeople should be violence in cities. Because of his practical Th e idea caught the interest of alumnus aware that they ought to take a leadership experience, his opinions carry weight. David Carson, BBA ’55, who created the role in shaping the country’s policies.” “As opposed to being the lawyer hired Carson Scholars program, guaranteeing From his long career in fi nancial ser- to talk about it, I actually was doing it,” fi ve years of funding for undergraduates vices, insurance, banking and mutual funds, Carson said. “You don’t have to be a paid to attend Th e Washington Campus. Carson knows fi rsthand how important it government person. As a matter of fact, is for business leaders to participate in you’re more eff ective if you’re not!” In LEFT Jeff Roth and Brandis Johnson applaud public decision making — not only on recent years his main civic cause has James A. Thurber, director of the Center for laws and regulations that aff ect their busi- been funding preschool education in Congressional and Presidential Studies at The ness interests, but also on issues such as Connecticut. He’s also chair of the Hart- American University, following his lecture about education and the environment. ford Parking Authority, and his wife Sara decision making in Washington. Every decade since the sixties, Carson is a justice of the peace. RIGHT Krister Holladay, chief of staff for Senator has testifi ed in Washington, speaking to Carson Scholars are selected through Saxby Chambliss of Georgia, talks to Ross congressional committees, regulatory an application process. To receive the students about the role of congressional staff. agencies and elected offi cials on topics as three credits granted for the course, in EILEEN COLTON EILEEN COLTON

dividend 33 fall 2006 EILEEN COLTON addition to the course exam they must changing nature of Washington, he said, desire to better understand the legislative write a 25-page paper during the summer every class of Carson Scholars is sure to process and not just the end products that following their week in Washington. Th e have a diff erent experience. show up in the news. He was particularly paper, Siedel said, allows more in-depth However, that experience will certainly interested in trade between the United States study of one of the topics covered during involve assumptions being challenged. and China, his native country. A class on the week, and there’s no shortage of those. Discussions on lobbying reform naturally that topic was taught by Pat Mulloy, a mem- Each day students are in class from 8 a.m. touched on the Jack Abramoff scandal, ber of the U.S.-China Economic and Security to 6 p.m., with lectures every hour on but they also presented a nuanced view of Review Commission and former assistant such expansive subjects as the economic lobbying, Percy said. “I never would have secretary for market access and compli- impact of the war on terrorism, the future thought of lobbying being a good thing,” ance with the Department of Commerce. of the U.S. economy, Social Security and he said. But he thought again when one Wang appreciated the wide-ranging dis- the Federal Reserve System. speaker dropped a registry of lobbyists cussion, where opinions ranged from calls Th e speakers represented all political bigger than a phone book in front of the for protectionist policies, to worries about and professional stripes. For example, students and said that everyone is repre- China’s increasing power in its trade rela- a class on presidential decision making sented by a lobbyist, whether they know tionship with the U.S., to shrugging accep- was taught by Jack Howard, former depu- it or not. Some speakers endorsed lobby- tance of globalization as a fact of life. “It’s ty assistant for legislative aff airs in the ing reform while others expressed doubt George W. Bush White House, while later that it would work: If a law passed that LEFT Michigan Senator Carl Levin talks with that day Marc C. Ginsberg, former am- put a $20 limit on meals lobbyists buy for students about the economy, automobile bassador to Morocco and senior foreign members of Congress, savvy restaurant industry and alternative fuels. policy coordinator for Al Gore’s 2000 owners around Capitol Hill would just fi ll MIDDLE Connecticut Congressman Christopher presidential campaign, traced the history their menus with $19.99 entrees. Shays discusses the environment, Iraq, the of radical Islamic thought and weighed “Th e profession of lobbying is stereo- federal budget defi cit, stem cell research and the diplomatic and trade policy impact typed by people who don’t understand it, separation of church and state. of the war on terrorism. and I was defi nitely one of those people,” RIGHT Students, left to right, Aerial Olaiz, Brian Percy was impressed with the extent Percy said. Chrzanowski, Kyle Zink, Dan Brachfeld and to which speakers drew on current events Percy’s classmate Zack Wang, BBA ’07, Joanna Shelden attended sessions 8 a.m. to 6 to illustrate their topics. Given the ever- arrived at Th e Washington Campus with a p.m. each day. EILEEN COLTON EILEEN COLTON

dividend 34 fall 2006 Jones Center Enhances BBA Core Experience

hen Th omas C. Jones, BBA ’68, WMBA ’71, gave $10 million in 2005 to the Ross School — the largest donation ever to an undergraduate business program — his goal was to transform undergraduate business education. LEFT Adam Percy, Grace Pan, Christina non-biased way. Th e whole week in general Th e Ross School used the gift to Ratusznik and Jeff Roth on the front steps of was unbelievable.” A major lesson she took establish the Th omas C. Jones Center for the Supreme Court. away, she said, is that there is a lot of ineffi - BBA Education “to enhance the core MIDDLE George Siedel briefs students before ciency in government — for example, com- experience via a set of activities that a presentation on the Hill. mittees are formed to investigate certain allow for the development of students RIGHT Grace Pan, left, and Christina Ratusznik topics but then never meet. “Information in extraordinary ways”— activities above relax at a restaurant near the House side of the like that has made me more critical and Hill during a break between sessions. aware of things the public needs to know.” She also gained insight on what a career very important to let people understand in public service might entail, and although the whole story, to present all the facts,” that hasn’t changed her plans to pursue said Wang. Th e week in Washington also legal work in the private sector, she said a left him with a new perspective on lobby- friend who attended the course is now more ing and introduced him to redistricting, interested in public policy as a career path. which he’d never learned about before but “Th e course allows each student to realize immediately understood as fundamen- what in fact they really are interested in,” tally important to the legislative process. Hilboldt said. Halley Hilboldt, BBA ’07, applied for With a new session coming at them every Th e Washington Campus course believing hour, as well as visits to diff erent federal that a stint in the nation’s capital would government buildings and the chance to line up well with her interests in interna- ask questions of people who know Washing- STEVE KUZMA tional business and ethics, as well as her ton from the inside, the students realized Tom Jones served as the Ross School’s fi rst career plans to go to law school and work as they were getting an education no class- BBA Program director and fi rst executive-in- an attorney in the entertainment business. room could ever off er. “You just knew,” residence in 2003–2004. “It was amazing,” Hilboldt said of the Percy concluded, “that these are the kinds course. “Th e amount I learned there was of experiences that will stick with you and unmatchable. I feel so much more informed shape you.” and beyond the school’s existing respon- about our government, and informed in a Mary Jean Babic sibility to deliver to BBA students a quality core educational experience. Scott A. Moore, director of the BBA Program, Arthur F. Th urnau Professor and associate professor of business information technology, says, “Tom certainly believes in the importance of an education that pre- pares students for their work life. Th e focus on student interaction with leaders in the nation’s capital and its topical emphasis on how government aff ects the business world make the Carson Scholars program a great match for the kind of initiative the Jones Center supports.” Th e Jones Center covered the transportation and housing costs for the Carson Scholars program.

dividend 35 fall 2006 From Spin Cycle ROMANIA: Making Whirlpool #1 to Baby Formula hirlpool, already the top-selling Wbrand among washing machines in MAP TAKES ROSS MBA STUDENTS Romania, has a bigger goal: Double its TO ROMANIA AND RWANDA sales volume in household appliances and move the manufacturer to the top spot in market share in Romania by 2008. “Basically we asked the students for recommendations for our growth strat- egy,” explains Mioara Bolozan, Whirlpool marketing manager for household appli- ances in Romania. “Our fi rst demand was hirlpool, the largest appliance dents from outside the United States, eager that the students fully understand our manufacturer in the world, to learn fi rsthand about corporate America, market. It was important for us and for W holds a special place in Ross choose U.S.-based MAP projects. them to see with fresh eyes. We know the School history. In 1995, Whirlpool spon- “Other schools off er internships and work market but sometimes you need a change sored the school’s fi rst international Multi- experiences,” notes Andrew Garland, MBA of perspective on consumers’ reasons for disciplinary Action Project (MAP) team. ’07, who, along with teammates, researched buying and on the competition.” Eleven years and 18 projects later, the Romanian appliance market and de- Whirlpool also is strong in built-ins Whirlpool remains a stalwart supporter veloped a growth strategy for Whirlpool and dishwashers, two growing categories of MAP, a required seven-week course in Romania. “But to be integrated into a in a market where consumers care more and cornerstone of the school’s action- company like Whirlpool for seven weeks about value and product features than based curriculum. Drawing on their is a great concept. Unlike a consulting brand. To learn about brand images, sales business and leadership skills, teams of assignment, it is a learning process with a incentives and perceptions of aft er-sale fi rst-year MBA students work full time true deliverable,” Garland adds. service for Whirlpool and its major com- with a corporate or nonprofi t sponsor on A MAP project sponsored by the Clin- petitors, team members Andrew Gar- complex business problems. Th e assign- ton Foundation’s HIV/AIDS Initiative land, Todd LeBlanc, Siddarth Mehta ment culminates in recommendations provided valuable international and non- and Rodd Santo, all MBA ’07, talked to presented in written and oral reports to profi t experience for Leena Ray, BBA ’02, 132 consumers, 60 sales personnel, six the team’s sponsor. MBA ’07, who worked at American Ex- repair service providers and fi ve manag- International MAP has grown steadily press prior to returning to Michigan to ers of national retail chains. Th eir goal since Whirlpool sponsored its fi rst over- earn a dual degree in business and educa- was to determine which product segment seas MAP team. Of the 87 MAP teams tion. Ray is interested in public education could yield the most in sales growth and the Ross School fi elded this spring, 44 reform and plans to work in a larger ur- add value across the Whirlpool brand. worked on international projects. Th irty- ban school district aft er graduation. She “In all, we conducted more than 4,100 eight percent of those projects were spon- and her MAP teammates traveled to minutes of interviews in nine cities across sored by U.S.-based fi rms, including Rwanda to assess that country’s capabili- Romania, surviving mainly thanks to a American Express, Borders Group, Cem- ties to produce infant formula for chil- great team of translators,” explains Santo. tura Corp., Intel, SC Johnson, Wal-Mart dren whose mothers are HIV-positive. Th e team also analyzed Romania’s business and Whirlpool. Other MAP teams worked on business environment. With per capita GDP ex- “Our students want to gain interna- solutions for nonprofi ts such as Make-A- tional experience, and recruiters increas- Wish Foundation, Habitat for Humanity, The Gorenje brand, featured here in Galati, ingly seek graduates comfortable working Rainforest Expeditions and Women for competes with Whirlpool in Romania. in the global market,” says Dean Robert J. Women International. Dolan. “International MAP is a great way Among MAP’s collateral benefi ts are for our students to apply what they learn the stories students bring back and share at the Ross School to actual business prob- with prospective employers at interviews. lems. Plus, they benefi t from living and Read on to learn about recent MAP team working in a diff erent culture.” Almost 60 work in Romania and Rwanda. percent of students from the United States opt for international MAP assignments. Not surprisingly, many Ross School stu-

dividend 36 fall 2006 is not asking for resources and who is not emotionally involved.” Th e team brought varied viewpoints to the marketing assignment: Garland had managed an emergency food relief pro- gram in Africa and taught in a charter school, Mehta had led business develop- ment for a publishing services fi rm for 29 states, Santo had worked as an architect and LeBlanc had served as a project man- ager at the HR consulting fi rm Towers Perrin. Faculty advisers Andrew Lawlor and Paula Caproni also were available by e-mail all hours of the day, LeBlanc adds. For Santo, Garland and LeBlanc, who came to the Ross School largely because Left to right, Siddarth Mehta, Andrew Garland, translator Doris Marin, Todd LeBlanc and Rodd Santo of MAP, the Whirlpool experience pro- are in front of a mural in the front lobby of Whirlpool’s Bucharest offi ce. The mural depicts the vided an unusual opportunity to structure Whirlpool Goddess, a central marketing theme aimed at the target market: Strong women in charge a complex project from the beginning, of their environment. defi ne it along the way and carry it to completion. “I had never done anything pected to grow from 3,200 Euros in 2005 machines, microwaves and built-ins. like this before,” says Santo. to 6,000 Euros by 2010, unemployment and To double Whirlpool sales volume in Living and working in Romania also infl ation in decline and consumers ex- appliances and move them to the top spot clarifi ed any misconceptions the students pected to increase their household expen- in market share in Romania by 2008, the may have had about the country. “Th e tour ditures, the appliance market in Romania students recommended that Whirlpool: books underestimate Romania as a tourist is poised for growth, the students soon destination,” says Garland. “It really is discovered. Invest more in advertising. Th e stu- beautiful, with cobblestone streets and an “Th ey did a very good job on the dents found that Whirlpool’s share of Old World feel.” macroeconomic analysis,” says Bolozan. voice in total advertising has been Mehta looks forward to returning to “We have to be honest. Macroeconomics declining in Romania as competitors Romania in fi ve to 10 years. “I want to see is not something a lot of people love. Th ey have begun to promote their products how things have changed.” brought skills in terms of consumer re- more aggressively. search and building the questions. Th ey Add ranges — also called freestanding also had to use all their skills in fi nancial cookers — to its product line. Free- management.” standing cookers represent 20 percent In 1995, Whirlpool’s fi rst MAP team of Romania’s appliance market. Whirl- compared and contrasted the household pool already is strong in cooker hoods appliance markets in Poland, Czech and built-ins. Adding ranges to their Republic, Slovakia and Hungary and product line would give loyal custom- recommended growth strategies. As part ers an opportunity to buy another of that project, the team created a research Whirlpool appliance, notes LeBlanc. tool — a stages-of-development frame- Introduce a value brand in Romania work used to analyze the politics, eco- that could compete at the low end nomics, infrastructure, trade channels, of the market without diluting competitors and consumers in the four Whirlpool’s high-quality reputation. countries — that has been used by subse- quent MAP teams, including this year’s Bolozan was impressed with the students’ effi ciency and thoroughness. team in Romania. Todd LeBlanc withdraws cash from a “I enjoyed their pragmatic approach “We took an in-depth look at the Bucharest bank. international competition and did a com- to their work,” says the marketing man- petitive analysis to see how each brand ager. “Th ey brought a holistic view and had positioned itself,” explains Garland. helped us focus. As a marketing manager, Th eir fi ndings: Whirlpool is an ideal I have raised some of the issues before. brand for many customers in the area It is probably better if some of these of refrigerators and freezers, washing ideas come from someone outside who

dividend 37 fall 2006 RWANDA: Can Infant Formula Be Produced Closer to Home?

wanda, home to the mountain Rgorillas that roam the misty bamboo forests of the Virguna Mountains, is a land of contrast — breathtaking beauty and humanitarian struggles. Th is spring a team of fi rst-year Ross School MBA students saw the endangered gorillas known for their massive size and gentle dispositions in the apes’ natural habitat. At the same time, the students were learning fi rsthand about Rwanda’s culture, history and economy; the devas- Cow’s milk is an ingredient in infant formula, so the Clinton Foundation MAP team researched how tating impact of the human immuno- much was available in Rwanda. In this photograph, a young man shows how milk is delivered from defi ciency virus (HIV), with which farms to dairy collection centers. approximately 3 percent of Rwanda’s 8.6 million people are infected; and the inter- national infant formula business. London is a senior research fellow and cial feasibility of producing infant formula Th e Ross students worked as business director of WDI’s Base of the Pyramid in Rwanda. Th e students found that the consultants to Rwandan government and Initiative. production of infant formula for the health healthcare organizations on a project that MAP team members Mark Bailey, market in Rwanda would be feasible if aimed to reduce mother-to-child HIV Amisha Parekh, Leena Ray and Mathieu certain business conditions were met. transmission and stimulate entrepreneur- Van Assche, all MBA ’07, worked closely Th e MAP students concluded that ship and manufacturing in Rwanda. Th e with Rwandan government offi cials; inter- building a formula plant would improve assignment: Assess the country’s capabili- national nongovernmental organizations Rwanda’s infant mortality rate and could ties to produce infant formula, which for (NGOs), including Partners in Health, the boost the country’s campaign to secure children whose mothers are HIV-positive Food and Technical Assistance Project foreign investment and promote new is safer than breast milk. Th e project was and UNICEF; and local healthcare pro- business development. sponsored by the Clinton Foundation’s viders. Th e students also met with business “Our partners in Rwanda were extremely HIV/AIDS Initiative. Robert Kennedy executives, including representatives from generous with their time and expertise,” and Ted London served as faculty advis- Sorwatom, Inyange and Sulfo Rwanda notes MAP team member Bailey, who has ers. Kennedy is executive director of the Industries. worked with nonprofi ts before and plans William Davidson Institute (WDI) and For a variety of health-related reasons, to go into foundation work. “We met with doctors generally recommend that mothers high-ranking people in the Department of in the developing world breast-feed their Agriculture and the National Aids Com- children. Th e primary exception to this mission, as well as NGO and business rule occurs with mothers who are HIV- executives. Part of the value of our project positive because HIV can be transmitted was bringing all these parties together so from mother to child through breast- they could gain a fuller understanding of feeding. Some NGOs provide HIV-positive mothers with infant formula as a substi- Left to right, Amisha Parekh, Mark Bailey, tute for breast milk to feed their children. Leena Ray and Mathieu Van Assche fl ew into “Rwanda has no domestic producers of Kigali International Airport. Their MAP infant formula, so the NGOs must import assignment: Assess Rwanda’s capabilities to the formula from multinational corpora- produce infant formula. tions like Nestlé,” explains Ray. Working with a team of teaching assis- tants from Rwanda’s Kigali Institute of Left to right, Leena Ray and Amisha Parekh Science and Technology, the Ross team speak with Corrie White of the Clinton Founda- researched consumer needs, including tion and Sara Stulac of Partners in Health (PIH) interviewing 30 mothers; assessed local at Rwinkwavu Hospital. PIH distributes infant sourcing, production, packaging and distri- formula and trains mothers how to use it properly. bution capabilities; and analyzed the fi nan-

dividend 38 fall 2006 Ross School Accepting MAP Proposals for 2007 orporate and nonprofi t organiza- Ctions benefi t in at least two ways when they sponsor Multidisciplinary Action Projects, says MAP Managing Director Gale L. Amyx. Sponsors receive actionable recommendations on current business issues they are facing and experience fi rsthand what Ross School MBA students can accomplish in a short period of time, and all at minimal cost to the organization. Sponsorship costs vary, depending on team size, location of the project, amount of travel required for gather- ing data and time spent on-site. Teams The trip to Rwanda provided Leena Ray and other members of the Clinton Foundation MAP team the are comprised of four to six students. opportunity to hobnob with mountain gorillas. Because MAP is an academic program, students do not receive monetary compensation. Sponsors cover expenses challenges and opportunities. Th ey dis- Resources and Environment. such as housing, meals and transpor- covered they could learn from each other.” In addition to their project-related work, tation when teams are on-site. Sponsor Because Rwanda’s resources are limited students explored their host country. costs average $12,000 for domestic pro- and it must import a fair amount of raw Weekend trips to several national parks jects and $20,000 for international ones. materials, technology and talent, “we had allowed the students to take in Rwanda’s About half the domestic MAP to think creatively and not get too dis- natural beauty. On a more somber note, projects are proposed by Ross School couraged,” explains Parekh, who also they also learned about Rwanda’s recent alumni, many of whom serve as the is earning a master of science degree history through visits to several sites com- sponsor’s liaison, working directly with through the Frederick A. and Barbara memorating the 1994 genocide in which an the MAP team to support its needs M. Erb Institute for Global Sustainable estimated one million people were killed. for a successful project outcome. Enterprise, a joint program of the Ross Th e Rwanda MAP project was pro- Th e competitive process of select- School and the U-M School of Natural posed by Polly Ruettgers, MBA ’06, who ing MAP team assignments for 2007 as a former staff member for the Clinton begins this fall. Prospective sponsors Foundation negotiated with pharmaceutical propose projects, which are evaluated companies for lower-priced drugs in Africa. by the MAP Advisory Team for rigor “When Polly arrived at the Ross School and fi t. Although the application as an MBA student, she had so many deadline is November 30, preference ideas I couldn’t keep up with them all,” is given to applications received ear- recalls Andrew Lawlor, a faculty member lier, Amyx explains. long involved with international action- Students bid on projects in early based learning programs. “One of them January and receive their MAP as- was for an infant formula plant in Rwanda. signments later in the month. To ‘Could such plants operate successfully learn more about sponsoring a MAP near customers and could they be scalable team, visit www.bus.umich.edu/MAP in other African countries, Brazil, India or call Amyx at 734.763.2463. and Romania?’” he recalls. Ruettgers’ contributions were recognized in April when she received the Ross School’s En- First-year MBA students learn about trepreneurial Leadership Award. projects at MAP kick-off. “Th e fact that Polly proposed our project and worked with us takes action-based Clinton Foundation Manager Beth Collins, learning to another level,” says Ray. Robert Kennedy and Polly Ruettgers, MBA ’06, “Our project was really entrepreneurial a former Clinton Foundation staff member, met in scope. I’ll never forget the experience. to discuss the infant formula MAP assignment It was so motivating.” Mary Jo Frank before the students arrived in Rwanda.

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" $ 5 * 0 / Early Women MBA Students Ushered in a New Era here were 19 of them. Rich and over 16 were in the labor force compared Administration Club. Th ey lived where poor, most came from Michigan to 60 percent in 2000. Th e diff erence lies they could, in a dorm, a sorority, with the T and most were in sororities. Many in the virtual absence of married women family of a professor or in one of many loved math. A high comfort level with workers in the early years of the last cen- private residences called League houses, numbers might be the most telling trait tury. In 1900, 44 percent of single women where women lived under University shared by the women who defi ed the worked, but only 6 percent of married supervision. Th e men, on the other hand, prejudices of their time to graduate with women did. formed two business fraternities, and the MBA degrees in the 10 years following But change was in the air. In 1920, dean dreamed of a dorm “to cultivate the creation of what is now the Stephen women won the right to vote and a social [men’s] esprit de corps by living together.” M. Ross School of Business. revolution in women’s dress and manners Segregation between the sexes extended Th ey lived in a world where most had taken hold. Many sheared their long to alumni clubs, smokers and other social women didn’t work outside the home. In hair, cropped their long skirts, dispensed events — even the want ads. the 1920s, only 21.5 percent of women with whalebone, smoked in public and Responding to a survey about women’s began breaking the law — specifi cally the careers published by Dividend in 1970, TOP Dorothy Hagen Simpson, center, a prohibition against liquor, which was Helen Cornelia Sandford, MBA ’28, wrote, member of the Business Administration Club. enacted in 1919. “Discrimination in my case began with BELOW Tappan Hall became the home of the All 19 students began college when the the University of Michigan itself. When I new Business School in 1924 (photo 1930). economy was booming. A fascination with was about to graduate with the MBA degree, business, the stock market and innovative I was advised to return to teaching, even new industries like automobile manufac- though my adviser said that as far as IQ turing swept through the country’s Main was concerned, I was second in the class.” Streets and caused Babbitts everywhere to Sandford, the daughter of Benjamin and dream of fantastic wealth. But by the time Sarah of Northville, New York, went on they graduated or began seeking jobs, the to become an investment accountant at world had become bleak. Th e 1929 crash Stanford University and and ensuing Great Depression closed then secretary-treasurer plants and drove men from the workplace of an investment bond to the breadlines. company. She died in Th e obstacles that confronted women San Mateo in 1995. workers were mirrored in the business Ailene Mae Yeo school. Women made up only 5.6 percent Bardsley, MBA ’33, of those earning MBAs between 1926 and however, remem- 1935: 19 women, in contrast to 317 men. bered that women In 1930-31, in the middle of that decade, were “very welcome.

PHOTO COURTESY OF BENTLEY HISTORICAL LIBRARY PHOTO COURTESY only 28 percent of all U-M students were Everyone was scared of women. [William] Paton,” who Two women business students held class taught accounting, she Ailene Mae offi ces; none was an offi cer in the Business said, “but he was a won- Yeo Bardsley

dividend 41 fall 2006 derful professor and very tolerant of us her grandfather were mining engineers in September 1924. Th e quarters were gals, there were so few of us.” in Michigan’s Houghton County. Samuel, “admittedly makeshift ,” old and inconve- Bardsley, who at 98 still lives in Ander- along with his wife Lauriette and their nient, according to acting dean C. E. Griffi n. son, Indiana, her home since the early four children, moved West, living at vari- Bardsley remembers walking up the stairs 1940s, doesn’t remember Margaret Elliott ous times in Colorado, California and the of “that old red building” and turning left Tracy, the one woman faculty member at Arizona Territory, where Parnall was born. into a classroom. A reading room and li- the school from its founding. Tracy re- Parnall came from California to Mich- brary took up a large part of the second fl oor. searched why women were clustered in igan for her BA, perhaps because of the Here, Dividend looks at the lives of social service and education jobs rather presence of family. Her uncle, Christopher other early women business graduates. than higher-paying business professions. Parnall, had been medical superintendent Students dressed up for class and, like and director of the University Hospital The Ross School’s many, Bardsley wore a fur coat but resisted and his sons attended the U-M. She was First Woman the lure of bobbed hair. She instead spent active in the Michigan League. Bardsley Th e freedoms women had won in the “hours” under the dryer at the hairdressers. remembers Parnall as “a super gal, with United States appealed to Sih Eu-yang Prohibition didn’t touch her life since she a brilliant mind.” Parnall graduated with Chen, MBA ’26, when she came from didn’t drink or socialize with those who high distinction. Soon aft er Parnall joined China. She, in turn, expanded those free- bootlegged liquor. Few students had cars. the Sanders company, Bardsley recalls, she doms as Michigan’s fi rst woman MBA. She, like the others, walked or rode the “practically ran it, moving up very fast to Chen kept a scrapbook of her time in the streetcars. Th e one exception was traveling become general manager.” state of Michigan and wrote of a month to the formal dances at the Michigan Union Aft er their trip abroad, Parnall resumed spent at a camp in Port Huron: “Th is is the because fl oor-length gowns required taxis. her job at Sanders, but Himmelhoch’s had life I can never get in China.” Her father Every such formal event began with hired a replacement for Bardsley. Unfazed, had been open-minded and encouraged a procession led by the man who had she moved to New York, where she became her education, according to her daughter chaired the event and his date. Bardsley a buyer for Lord & Taylor. Th ere, a friend- Lillian Yeu. At age 25, aft er teaching alge- twice led such processions. Women re- ship with a man who had lived in the same bra and English in girls’ middle schools, ceived special dispensations from rules apartment building in Detroit blossomed Chen graduated from the Commercial for big events like the J-Hop. Otherwise, into a romance, and in 1940 she married College of Southeastern University in they had to be in their rooms by 11 p.m. P. Edward Bardsley. Th e war took them Shanghai in 1924. during the week and 1 a.m. on the week- to Anderson, Indiana, where the General Chen came to Ann Arbor as the 52nd end. “Our housemother would sit up until Motors Delco-Remy plant produced recipient of a Barbour scholarship for everyone was in,” Bardsley recalls. war materiel. She didn’t work outside Asian women, one of 10 that year. She Th e only child of Alice and William, the home —“I didn’t have to,” she recalls. received a stipend of $800. It was not easy a Canadian who practiced law, Bardsley Bardsley was active in the community for Asians on campus at that grew up in West Branch, while raising her two children. When they time. Sixteen of the 24 Michigan. She earned a BA were grown, she traveled for her sorority, League houses in a 1925 degree and teaching cer- helping establish new chapters. Every survey refused to accept tifi cate in 1930 and summer Parnall spent a week with Bardsley Asian residents. Th e taught a year in Royal and her family in Northern Michigan. University oft en sought Oak before deciding, Parnall died in Whittier, California, in 1995. American women who partly because she loved Th e program that Sandford, Bardsley, were members of inter- math, to return for an Parnall and the 16 other women em- national clubs such as the MBA, majoring in bank- barked on consisted of three years of Cosmopolitan or World ing and merchandising. work in the liberal arts and two years in Fellowship/YWCA to share Her fi rst job was with the business school. A BA degree was houses with Asian students. Himmelhoch’s in Detroit awarded aft er the fi rst three years, and Chen lived in Helen New- Mary Parnall as a buyer in the better an MBA aft er the last two years. In the Sih Eu-yang Chen berry residence hall, joined dress department —“any fi rst year they could study production, the Chinese Students’ Club and was the dress over $29,” she explains. She orga- personnel, marketing, business statistics, sole woman in the Business Administra- nized a fashion show fundraiser for the accounting and fi nance. In the second, tion Club. She received a “favorable” aca- Michigan League using professional they studied accounting, marketing, in- demic evaluation from Dean Day and, models and U-M students. vestments, banking, sales administration, when she graduated on June 14, 1926, she Aft er working for the retailer for fi ve advertising and real estate management. wrote: “I consider it a very important day, years, she and her friend Mary Parnall, Courses in business policy and a thesis for I am the only girl getting [an] MBA MBA ’31, who worked for Sanders ice were required. In 1929, the number of from the Business School of the Univer- cream company in Detroit, obtained leaves years in liberal arts was reduced to two sity of Michigan.” of absence to travel around the world. and the years in the business school in- Chen explored the country and returned Sailing from Oregon, they spent six months creased to three. to Ann Arbor for a semester’s study, sail- visiting Hawaii, China, Australia, India With a curriculum in place, a faculty ing home in February 1927. Th ere she and Europe. drawn mostly from Harvard and Michigan, met Chungshen S. Chen, who had earned Parnall was born into a family of ad- and Edmund E. Day as dean, the fi rst a PhD from Columbia and worked at a venturers. Both her father, Samuel, and students were welcomed to Tappan Hall bank. Th ey married in 1928. She worked

dividend 42 fall 2006 before and aft er marriage, as an accoun- attend the University and worked as a Michigan, in 1937, and unlike many of her tant and eventually, aft er four babies housemother, bookkeeper and dispensing women classmates, she continued to work. came, as a professor in the Commercial assistant in the chemistry store while her She stayed at Edwards Brothers until Department at Shanghai College. daughter attended school. 1940, when she moved to University Litho- Th e family fl ed Shanghai aft er Japan Ann Edwards, the wife of Joseph, the printing Co. in Ypsilanti. On a Saturday invaded, and her fi ft h daughter was born former president of Edwards Brothers, night in January 1946, at age 38, she fell in Chunking. By 1946, they had returned said that Burke gave the credit to the down the basement stairs at home and to Shanghai and she became chief accoun- school for her training and to J. William died the next day of a brain hemorrhage. tant at the New Asia Development Corp. Edwards, Joe’s father, for hiring her. Burke Johanna Wiese didn’t stop with an MBA, In 1949, the family made its way to Hong also had a role model in her mother who but became a certifi ed librarian in 1935 Kong, where Chen taught English and her worked aft er marriage and motherhood. at age 24. Th e sixth of seven husband worked as a fi nancial adviser. “May was outgoing and sharp, very social,” children born to Mathilda Th ey sought scholarships for their daugh- said Ann Edwards, “and Evelyn was chatty and Charles, a machine ters in American schools, and all of them and personable, but circumspect — she operator from West became professionals in public health, math never gossiped or criticized.” Th e two Prussia, Wiese was a or education. In 1959, the Chens were women opened their Olivia Street house at woman of wide-ranging sponsored by a church in San Francisco. U-M reunion time, and in 1948 a fellow interests at Ann Arbor Arriving as refugees, they settled in business graduate reported that alumni High School. She partici- Berkeley, where Chen attended adult gathered and “sang at the Burke residence.” pated in student govern- education classes. Both her daughter and Elizabeth Ross also had a working mother ment and literary, athletic son-in-law Joseph Pummill describe as a role model. Ross’ father, and dramatic clubs, and was Chen as curious, outgoing and creative, Maurice, settled in De- elected class tomboy. with many friends — traits that helped her troit and established the Wiese worked at the Wil- Johanna adapt in her tumultuous life. She died in L. Black Co., a jewelry low Run bomber plant during Mathilda Wiese 1981; her husband died a year later. business. He died in World War II, as director of 1921, when Ross, the school libraries in Chelsea, Michigan, Pursuing Careers oldest of three, was assistant to the U-M Dean of Nursing and in Business and Education 14. His widow, also at Social Security. Her leisure activities named Elizabeth, included church, women’s clubs, and his- Professional degrees opened doors to managed the company, torical and philanthropic groups. A loyal careers in business and education for expanding it to include alumnus and lifelong Ann Arbor resident, Evelyn Kingsbury Burke, MBA ’28, Eliz- optical goods. she attended many business school re- abeth Charlotte Black Ross, MBA ’29, Elizabeth Ross was a horse- unions. She died in 1996 at age 84. Alice M. Plough Lemen, MBA ’30, Jo- Charlotte woman and joined Dorothy Simpson taught in Detroit hanna Mathilda Wiese, MBA ’33, Doro- Black Ross Pegasus, a riding club. during the school year, but thy Margaret Hagen Simpson, MBA ’28, As an undergraduate, she she spent her summers F. (Freida) Elizabeth Forman Lauren- was elected a lower-class offi cer. Aft er traveling the world. In son, MBA ’34, and Eleanor Louise Delo earning her MBA at the age of 22, she the summer of 1929, Paddock, MBA ’31. returned to Detroit, married John Ross she lived at the Today, the name of Evelyn Kingsbury and had two daughters. When she died northern tip of the Burke lives on in a Ross School scholar- in Grosse Pointe in 1992, she still owned Labrador Peninsula, ship that bears her name. When she died the business her parents had left her. only a few hundred in 1992, Burke bequeathed $158,000 to Another businesswoman, Alice M. miles below the Arc- the business school. But her situation was Plough Lemen, daughter of Washington tic Circle, working grim in 1937, when she returned to Ann State fruit growers Walter and Bessie Plough, with the International Arbor from Chicago aft er a brief marriage came to Michigan in the late 1920s aft er Grenfell Association to to A. G. Rueckert and took a job as a graduating Phi Beta Kappa Dorothy Margaret complete aerial map- factory worker. In 1941, at age from Washington State Hagen Simpson ping of the coast. Th e 36, she began working at College. Th e business previous summer, the Edwards Brothers printing school hired her as fi rst aft er obtaining her MBA in 1928 at company and rose from an associate in the 21, she had toured Europe, and she spent offi ce work to become Bureau of Business the following summer seeing South the elected secretary- Research at a half- America. Simpson’s father, Marcus, born treasurer of the fi rm in time salary of $500. in Norway, was a physician in Detroit. 1949, a post she held Only two years Her mother, Th iel, moved to Ann Arbor until her 1970 retirement. aft er graduating with with her two children while they were in Her parents, Orrin and distinction, Lemen school. Simpson married George Lester May, worked as bookkeep- became secretary- Simpson, and died in Oceanside, California, ers in a bank in Sparta, treasurer at Edwards in 1986. Evelyn Michigan. Aft er her hus- Alice M. Brothers. She married Teacher Eleanor Louise Delo Paddock Kingsbury band’s death, May brought Plough Lemen Alfred Lemen of Dexter, described directing 350 volunteers work- Burke Burke to Ann Arbor to

dividend 43 fall 2006 ing with underachieving Building Families pleased when Reddick became a nurse. elementary school chil- and Communities Johnson was very shy, her daughter said, dren “as the most inter- Some of the early women graduates seldom traveled and didn’t entertain a lot, but esting and rewarding she was a formidable Scrabble player — work since I left the worked outside the home until they mar- ried and had families. Among them were in Latin. She died in 1979. University of Michigan” Val Emde shared all of her sister Bessie’s when she responded to sisters Bessie Valborg Egeland Johnson, MBA ’31, and Edith Valborg (Val) Egeland honors, was elected to Phi Beta Kappa a 1969 Dividend alumni and graduated at the head of her business questionnaire. Emde, MBA ’32, who grew up in Bisbee, Eleanor Louise school class. She was the fi rst Like several of the North Dakota. Delo Paddock woman at U-M to be in- early women graduates, Th e girls’ father, Axel, came from Norway, and settled in Bisbee, where he estab- ducted into Beta Gamma Paddock was an only child and grew Sigma, the national hon- up in comfort with her parents Roy, a lished himself as a banker and met his future wife, Ida, when she was visiting orary business society. banker in Elmira, New York, and Lily, Emde joined the who was born in England. Immediately from Chatham, Ontario. He died when Johnson was 15 and her sister was 14. Ida, Cosmopolitan Club, aft er earning her degree, she taught com- made up of American mercial subjects at Dickinson Seminary a teacher, moved them back to Chatham. In September 1926, she rented a house for and foreign students, in Williamsport, Pennsylvania. She then and the World Fellowship taught in her native Elmira, New York, until the three of them for her daughters’ fresh- man year at U-M. Committee of the YWCA, she married Byron Paddock and had a which she chaired as a son in 1945. Paddock died in Horseheads, Johnson served on the board of the Michigan League in 1929, the year it was senior. Her work on the Edith Valborg (Val) near Elmira, in 1996. Daily earned her a publi- Egeland Emde Elizabeth Laurenson taught math to completed aft er a sustained, impassioned fundraising eff ort by Michigan women. cations scholarship for inner-city children almost poetry in 1930. Th e busi- all of her adult life and Th e sisters lived in a League house aft er their mother returned to Chatham. ness school hired her for $1,600 to work wasn’t about to let in the Bureau of Research for a year be- mandatory retire- Johnson spent the summer of 1928 as the Michigan Daily’s circulation manager; tween earning her BA at 20 and her MBA. ment at age 65 stop She stayed on at the Bureau of Research her. “She was spir- Emde also joined the Daily staff , but on the editorial side. aft er receiving her MBA, living with her ited and ran for sister. Th e two had little money. Reddick school board in As juniors, the sisters moved into Martha Cook residence hall. It was such tells of a time the sisters dined on a single Oakland, Califor- egg. She married Ludwig Emde, who nia,” according to a happy time, recalls Johnson’s daughter Deborah Reddick, that when her mother graduated from U-M in 1930 with an daughter Betsy White. engineering degree and became president She served two terms, spoke of being at the U-M, she would talk of “when we lived in Martha Cook.” of a company that made water coolers one as president, before Elizabeth Forman As an upperclassman, Johnson was and refrigerator parts. Th e couple stayed being felled by a stroke. Laurenson in Ann Arbor, where she continued to “She worked tirelessly to inducted into Wyvern (a junior honor society), a national honorary journalism work until 1937. Her son, Robert C. improve education,” White recalls. Emde, BBA ’60, MBA ’61, was born in 1938, When she was growing up, Laurenson’s sorority and the Senior Society for inde- pendent (non-sorority) women. Class- and the family moved to Birmingham, family didn’t have much money; her son Michigan. She died there Mark says, “Th ey didn’t starve, but she mates elected her vice president of her LSA class. in 1987. had to work for everything she had.” Her Th roughout the 1990s, Robert Emde was parents Robert Clyde and Myra owned an Th roughout her years in Ann Arbor, Johnson was in love with Godfred Johnson, lead accountant for Ernst & Young on the eatery in Newaygo, Michigan. Laurenson U-M account, reporting annually to the was the oldest of the fi ve children and whom she had known in Bisbee. In 1933, at 25, two years aft er earning her MBA, Regents. When Christopher R. Emde, worked her way through Western Michigan now vice president of sales with Enter- University at her boarding house and as a they married at the Michigan League. Johnson worked briefl y tainment Sports Partners in Bloomfi eld Western Union operator. Hills, earned an MBA in 1997, he became She earned her MBA at age 25 and at Hudson’s depart- ment store in Detroit the family’s third-generation Ross MBA. married William Laurenson, who gradu- To read about more early women grad- ated with a BS degree in naval architec- before she and Godfred, a banker, uates, visit www.bus.umich.edu/NewsRoom/ ture and marine engineering. His work WomenPioneers. took them to Virginia and California, settled in Petoskey, where he worked on Liberty ships, and Michigan. Th e Linda Robinson Walker she briefl y taught. Aft er William died in mother of three 1950, Laurenson moved with her four was active in her Editor’s Note: We thank the Ross alum- children to California and resumed church and commu- ni, relatives of alumni, staff of the Bentley teaching. She died in 1991. nity. Johnson told her Historical Library and the Michiganensian daughter that she felt Yearb o ok who contributed to this article her own degree was Bessie Valborg and provided photographs. useless and was Egeland Johnson

dividend 44 fall 2006 ALUMNI ACTIVITIES

BRUSSELS —When Bobby Wehmeyer, left, and Amish Thakker, right, both MBA ’07, were work- ing in Belgium this spring on their Multidisciplinary Action Project sponsored by OrthoMediTec, they BALTIMORE — Among those who attended used the opportunity to touch base with Ross Baltimore the annual holiday party were, left to right, alumni there, including Christophe Soulier, MBA Th e Ross School Alumni Clubs of front row: Susan Benkowski, MBA ’01, ’02, fi nance director at Johnson & Johnson, Baltimore and D.C. hosted their annual Linda Murphy, BS ’81, MBA ’85, Julie Granof, who took the MAP team members to lunch. holiday party at the home of Adam Bor- MBA ’05, MPP ’05, Diviya Sharma, MBA ’05, den, MBA ’05, and his wife Meredith in and Rachel Zimmerman, MBA ’00; back row, Baltimore on December 11. Approxi- Noah Cowan, MSE ’97, PhD (Engineering) ’01, Germany mately 25 alumni and their families, in- Ed Watts, MBA ’03, Adam Borden, MBA ’05, cluding four members of the Class of Steve Silberg, MBA ’72, and Jonathan Nellis, Th e Ross School Alumni Club of Ger- 2005, attended the festivities. Contact MBA ’05. many met on May 21 in Frankfurt. Andreas Borden at [email protected] for more Kirschkamp, EX ’00, welcomed the group. information about the Baltimore club. Th e program included discussions about the importance of TV soccer rights in a converging media world and the distressed debt market as a driver of economic Chicago growth in Germany. Professor Emeritus Th e theme of the Chicago Alumni Gunter Dufey also shared news about the Club’s Annual Spring Business Confer- Ross School. Th e day concluded with a ence on April 6 was “Private Equity Per- visit to the exhibition Max Beckmann, spectives — Michigan Alumni in Private Th e Watercolors and the Pastels. For more Equity and Entrepreneurship.” David information on club activities, contact Brophy, associate professor of fi nance and Kirschkamp at [email protected]. conference keynote speaker, talked about emerging trends in private equity. A pan- el of Ross alumni also provided their perspectives on trends and how private equity fi rms work and interact with en- CHICAGO — Among those who attended trepreneurs. Panelists included William Chicago’s Annual Spring Business Conference Hall, MBA ’67 and PhD ’69, chairman were, left to right, Evan Gallinson, BBA ’97, and CEO of Procyon Technologies Inc. Yehuda Cohen, MBA ’83, Harriett Robinson, and adjunct professor of strategy; Dan MBA ’80, and Jeffrey Spahn, BBA ’75. Hennessy, MBA ’81, founder and partner of Code Hennessy & Simmons LLC; Keith Yamada, BBA ’90, partner of CIVC Partners; and Jon Leiman, BBA ’94, an associate at American Capital. Contact Yehuda Cohen, MBA ’83, at yccohen@ umich.edu for more information about GERMANY— Professor Emeritus Gunter Dufey, the Chicago club. left, front row, met with Ross Club of Germany members and friends Michael Wolff, MBA ’92; CHICAGO — David Brophy, associate professor back row, Tabi Bude, EX ’00, Martin Arnold, of fi nance, center, talks with Ross School Frederic Fayolle, MBA ’98, Alexander alumni at the Chicago club’s Annual Spring Winkelmann, EX ’00, Florian Muller, EX ’00, Business Conference held at the Sears Tower Radboud Vaessen, MBA ’01, Andreas Kirsch- Conference Center. kamp, EX ’00, and Roman Martens.

dividend 45 fall 2006

ALUMNI ACTIVITIES

New York Dean Robert J. Dolan and Stephen M. Ross, BBA ’62, met with more than 350 Ross School alumni who gathered at the Waldorf Astoria Hotel in New York City on October 25 to socialize and view plans for the new building. In April, members of the New York Alumni Club attended an evening program with Iraqi Ambassador to the United Nations Feisal Amin al-Istrabadi, who talked about the role of the U.S. business community in recon- structing Iraq. Contact Cecil Shepherd, MBA ’00, at [email protected] for more information about the New York club.

NEW YORK —The Ross School of Business Alumni Club of New York board meets quarterly to plan club activities. The board includes, left to right, front row, Bob Crespi, MBA ’99, and Emily Kramer, BBA ’04; back row, Winston Ma, MBA ’03, Cecil Shepherd, MBA ’00, David O’Dell, MBA ’04, Candace TenBrink, MBA ’97, and Timothy Garrabrant, MBA ’85. NEW YORK — Left to right, Stephen M. Ross, BBA ’62, Dean Robert J. Dolan and Cecil Shepherd, MBA ’00, at the Waldorf Astoria Hotel.

NEW YORK — Members of the New York Alumni Club hosted a BBA happy hour on January 12. Among those who attended were left to right, front row, Cecil Shepherd, MBA ’00, and Emily Kramer, BBA ’04; middle row, Scott Buchbinder, Pamela Baskies, Leaat Dulberg, Grace Song SAN FRANCISCO — The Ross School is well represented on the University of Michigan’s Bay and Allison Stebbbins, all BBA ’04; back row, Area Softball Team. Team members include, left to right, front row, Scott Sappenfi eld, MBA ’03, Justin Surma, BBA ’04, and Vincenzo Villamena, and Kevin Hamilton; middle row, Jon Munzel, MBA ’00, Katie Martin, Cara Schwartz, MBA ’02, BBA ’04 and MAcc ’05. Jamie Harding, Jeremy Cotton and Jennifer Lazar, BBA ’05; back row, Mike Wolfe, MBA ’05, and Juan Pablo Bedoya, MBA ’05. Contact Adam Carson, MBA ’03, at [email protected] for more information about the Ross School of Business Alumni Club of San Francisco.

dividend 46 fall 2006 ATLANTA AUSTIN AUSTRIA BEIJING BOSTON BUENOS AIRES CENTRAL AMERICA CHICAGO CINCINNATI CLEVELAND COSTA RICA

DALLAS DENVER DETROIT DUBAI EASTERN EUROPE FORT WAYNE FRANKFURT GRAND RAPIDS GREECE HARTFORD HONG KONG

HOUSTON INDIANAPOLIS IOWA ISRAEL IVORY COAST JAPAN KANSAS CITY LONDON LOS ANGELES LOUISVILLE MADRID MEXICO CITY

MIAMI / FORT LAUDERDALE MILWAUKEE MINNESOTA MUMBAI NEW DELHI NEW YORK NORFOLK NORTH CAROLINA NORWAY OREGON

~ PARIS PERU PHILADELPHIA PUERTO RICO ROME SAN DIEGO SAN FRANCISCO SANTIAGO SAO PAULO SEATTLE SHANGHAI SINGAPORE

SOUTH KOREA ST. LOUIS SYDNEY TAIWAN TAMPA THAILAND TOLEDO VENEZUELA VIETNAM TORONTO WASHINGTON, DC ZURICH

CREATING A LIFETIME COMMUNITY FOR ROSS ALUMNI AROUND THE WORLD

www.bus.umich.edu/alumnicommunity/alumniclubs

734.763.5775 izing Doctoral Education in Business.

Jack Rounick, BBA ’56 recently joined the law fi rm of Flamm, Class Notes Boroff & Bacine PC in Blue Bell, Pennsyl- vania. He recently was named one of the Mary Davidson, BBA ’50 home and relax with a good book or top 100 attorneys in the U.S. by Worth joined Himmelhoch Department Store in crossword puzzle. You can reach Mary at magazine and one of the top 100 Super Detroit aft er graduation, and during her [email protected]. Lawyers in Pennsylvania by a vote of 25 years there she became a buyer and some 36,000 Pennsylvania attorneys. Jack merchandise manager. When it shut Vern Terpstra, BBA ’50, MBA ’51, PhD ’65 also serves as a director of Deb Shops down, she joined Th e Vogue in nearby received a certifi cate of appreciation from Inc., a NASDAQ-listed company. You can Flint for 12 years until it closed. She then Wichita State University for his workshop reach Jack at jrounick@fl ammlaw.com. worked for Hadley Arden and retired on Internationalizing the Curriculum, aft er it shut down in 1993. “For a busi- held in mid-May. Th e conference included Bruce D. Evans, MBA ’58 nesswoman in those days, retailing was about 20 members of CIBER (Center for is a professor of management at the your primary area,” says Mary. Aft er re- International Business Education and University of Dallas. Since creating the tirement she did some traveling until her Research) and some 90 professors from fi nal required MBA course there in 1993, sister was diagnosed with cancer. Mary around the country. Vern also attended a Bruce has guided 133 strategy-based team took care of her until her sister passed CIBER conference at the University of projects in which his students develop away in March. Now she is content to stay Connecticut in late July on International- solutions for actual business problems

Now an independent consultant, she Mom, Daughter provides clients with project management and IT services. “Although it may not bring the title, salary and prestige of a Balance Family, Careers large corporate or consulting setting, I am able to balance client and family needs,” Cullom explains. “I advise new mothers hen Rose Potcova Szoke, BBA provider and became director of Physician to fi nd a way to stay connected to their ’50, graduated, she started out Systems and then director of IT Consul- profession, even if it is a step back, be- W in retailing in Grand Rapids, tancy. “In 1997 we had our fi rst child, cause coming back is much more diffi cult. Michigan, and ended up at J. L. Hudson Rosemary, and I worked part-time,” she I returned to work for several reasons: I in Detroit. “I worked in retailing for eight explains. “Th is put me on a diff erent missed the challenge, I wanted to help years and then stayed home for 20 years,” track when it came to advancement.” In provide for my family and I wanted to set she says. 1999 she left the paid workforce. “My an example for my children that you can Szoke resumed her career in 1978, fi rst husband was doing well with his consult- be anything you put your mind to, and teaching in Buff alo and then helping ing practice, Evergreen Management that it takes work to build and support a women reenter the workforce. She retired Advisors. I poured myself into full-time family.” Contact Cullom at tcullom@ in 1992 and moved to New Mexico in motherhood. We had our second child, emadvisors.com. 1996. “When you are getting out of busi- John, in 2000.” Fred Wessells ness school, you think as an individual. But later the degree helps shape your values and commitments to your family, com- munity and place of worship,” says Szoke. Women today tend to do more career goal setting and planning than a generation ago, she notes, “and their timetables do not include 20 years out of the workforce.” For example, her own daughter, Tina Szoke Cullom, MBA ’85, started in con- sulting with Touche Ross (later Deloitte and Touche, then Deloitte Consulting) in Chicago from 1985 to 1990, left consulting in 1991 to join a client’s IT department, and in 1994 returned to Deloitte. Tina married Mike Cullom in 1994 and a year later moved to the Denver area, where she joined a local healthcare CLASS NOTES book, White the forefront lays out his of helping submitted by CEOs. “Our typical class is philosophy Michigan 14 students, and they decide how to orga- about leader- policymak- nize their group into workable teams that ship gained ers, commu- jointly develop and deliver meaningful over 30 years nities and solutions to real problems. It has been a as a leader, residents very rewarding experience over the past both in aca- better under- 34 years.” To contact Bruce, e-mail demia and stand and [email protected]. industry. harness the What do reptiles and mammals have power of information and communica- Lynn R. Evans, BBA ’59, MBA ’59 to do with leadership? White uses the tion technology to improve the lives of all has been appointed alumni representative dichotomy of reptile and mammal to Michigan residents. You can learn more to the U-M Committee on the Economic illustrate the dual nature of leadership, with at www.cybermichigan.org. Status of the Faculty. Th is committee, reptiles representing the detached, ana- formed in 1944, monitors faculty salaries, lytic and sometimes adversarial side of Howard Prager, MBA ’80 fringe benefi ts and other aspects of fac- leadership and mammals representing the As director of Lake Forest Corporate ulty employment competitiveness at other nurturing, engaged and cooperative side. Education, www.lfce.org, Howard works universities. Lynn continues to serve on In Th e Nature of Leadership, White goes frequently with corporations to create the board of directors for McLaren Hos- beyond this dichotomy to outline a broader business and leadership certifi cate pro- pital in Flint, Brighton Hospital (Michi- framework. Th e reptilian and mammalian grams. Th e fi rm recently won three awards gan’s largest substance-abuse facility), nature of leadership form the sides of for its work with Simonton Windows of “M” Club (University letter winners White’s leadership pyramid. Other quali- West Virginia. Last year it was recognized group) and the U-M Alumni Association. ties he calls foundation requirements — as one of the top fi ve leadership develop- He resides in Bloomfi eld Hills but spends including ability, strength, character and the ment programs in North America (along as much time as possible in Charlevoix, desire to be in charge — form the pyramid with Caterpillar, GE, 3M and Procter & Michigan. base. At the top of the pyramid are the Gamble). You can learn more about How- leadership requirements to make change ard and LFCE by contacting him at Roger Frock, successfully, including innovative thinking, [email protected]. MBA ’59 risk-taking and recruiting great people. a member of the White, dean emeritus and professor Ted Haddad, ’BBA 82, founding group of emeritus of business administration at the and Dan McEnroe, BBA ’85 FedEx, has written Ross School, served as interim president co-founded Azimuth Capital Management Changing the Way of the University of Michigan in 2002. He LLC in September 2004. Th eir independent the World Does Busi- also served in two vice presidential posts investment management and fi nancial ness, the inside story at Cummins Engine advisory fi rm is in Bloomfi eld Hills, Michi- of FedEx’s incredible Co. from 1981 to gan. It draws on the diverse expertise of journey to success. It 1987. In January its principals to manage customized in- will be published by 2005, he took offi ce vestment portfolios and deliver excep- Berrett-Koehler in October. “Th e book as the 16th presi- tional client service. Th e fi rm’s primary recounts the potential roadblocks we dent of the Univer- focus is serv- faced, the diffi culties sity of Illinois, with ing high- of getting through the start-up, and the responsibility for its net-worth programs we instituted for our employees Urbana-Champaign, families, and customers,” says Roger. He adds, Chicago and Spring- endowments “Customer satisfaction was always a key fi eld campuses. A and institu- element in our plans for the company and native of Detroit and tions. Ted has certainly one of the major reasons for its raised in Kalamazoo, White earned an more than success.” You can contact Roger at MBA at Harvard Business School and a 20 years’ [email protected]. BS degree in international economics at experience Georgetown University School of Foreign Ted Haddad in the invest- B. Joseph White, PhD ’75 Service. ment man- shares the secret of becoming a great agement fi eld, leader in his new book, Th e Nature of Janice M. Whitehouse, MBA ’79 previously as Leadership: Reptiles, Mammals and the has been named president of CyberMich- managing Challenge of Becoming A Great Leader, igan, an institute within the nonprofi t director at R. being released by AMACOM Books in Altarum. “With support from Cyber- H. Bluestein October. Th e book includes a foreword Michigan, the state of Michigan has made & Co. and by C. K. Prahalad, the Paul and Ruth tremendous progress in providing resi- then as vice McCracken Distinguished University dents access to information technology,” president of Professor of Corporate Strategy. In this says Janice. CyberMichigan has been at Goldman, Dan McEnroe

dividend 49 fall 2006 ACROSS THE BOARD Quenching Thirst in the Hot Hispanic Market

he best part of life is recogniz- business was conducted in the former ing an opportunity and capital- Soviet Union, which culminated in a two- ‘‘T izing on it,” says Richard Ross, week class trip to Russia. MBA ’91, vice president of marketing at Tampico Beverages was among the fi rst Tampico Beverages. Tampico is the top- businesses to capitalize on the growing selling refrigerated juice drink in the U.S. Hispanic market. Instead of promo- United States (ACNielsen 2005) and the tions in large retail chains, Tampico chose top nonalcoholic, noncarbonated beverage to leverage the power of smaller, indepen- in the Hispanic marketplace (Spectra 2005). dent retailers and market at cultural festi- Ross’ path to becoming an expert in vals, where Tampico was oft en the only Hispanic marketing began in childhood. beverage present. Due to his father’s job in the industrial Ross cites the 2000 census as a turning diamond business, his family traveled point in multicultural marketing in the frequently. Th is inspired a passion for United States. Th e census showed that the travel and learning about other cultures. Latino population is the fastest-growing He was especially drawn to Latin culture, segment of the U.S. population. Th e cen- with its emphasis on family and food, sus results confi rmed what Tampico knew which mirrored his own values. all along — that the Hispanic marketplace Today, Ross’ expertise in niche market- aff ords a huge opportunity. Tampico now consumers from a large number of ing is recognized throughout the fi eld. faces more competition from large com- countries and with various degrees of He contributed to the book Hispanic panies with big budgets. acculturation. Marketing —A Cultural Perspective and is However, Tampico will continue “to Th e demand for Hispanic marketing an affi liate faculty member at the Center concentrate on what we do best,” says specialists continues to outweigh the for the Study of Hispanic Marketing Ross. Th e fi rm has worked hard to build supply. Th e “future is bright for all,” says Communication at Florida State Univer- customer loyalty and remains focused on Ross. For students and alumni interested sity, the fi rst program of its kind in the its core business. Initiatives include re- in multicultural or niche marketing, Ross United States. packaging key products, expanding to off ers this advice: Focus on building soft Ross chose the Ross School because of new channels and adding new product skills such as communication and team- its team-based approach to learning and lines such as a vitamin-fortifi ed Tampico work, get out from behind the computer the real-world exposure provided by Plus drink and a line of zero-calorie fl a- and learn from others in the fi eld. alumni visits. One of his most memorable vored water. Tampico also is refi ning its experiences was a course analyzing how marketing strategy to target Hispanic Adrienne Losh

Sachs & Co. He also has served as a mem- Mark Bodnar, MBA ’83 Alumni Club, Financial Planning Asso- ber of the Alumni Board of Governors and a fi nancial professional with AXA Advi- ciation and the National Association of the Corporate Advisory Board of the Ross sors LLC in Cincinnati, has earned a cer- Insurance and Finance Advisors. He re- School and is a member of the CFA tifi cate in retirement planning from the sides in Cincinnati with his family and (Chartered Financial Analysts) Institute. Wharton School. Mark was one of only has been with AXA Advisors since 1987. Dan’s experience includes executive posi- 50 AXA Advisors fi nancial professionals You can reach Mark at Mark.Bodnar@ tions at Penske Corp., including treasurer selected from more than 3,000 nation- AXA-Advisors.com. of Detroit Diesel Corp. and portfolio man- wide. He also holds the Certifi ed Finan- ager at JMB Institutional Realty Corp. He cial Planner, Chartered Financial Consul- Andrew Dietz, BBA ’84 previously served as a member of the tant and Certifi ed Life Underwriter has just written Th e Last Folk Hero: A board of directors of Noble International professional designations. He is active in True Story of Race and Art, Power and Ltd. and is also a CFA. Ted and Dan can community and professional organiza- Profi t (Ellis Lane Press, 2006). Th e book be reached by phone at 248.433.4000 or tions, including Summit Country Day discusses the ugliness behind the high- by e-mail: [email protected] and School, Cincinnati Association of Life stakes, big-egos world of folk and modern [email protected]. Underwriters, University of Michigan art collecting. Andy reveals the power

dividend 50 fall 2006 CLASS NOTES Lesa Chittenden Lim, MBA ’86 and institutions. Catherine serves on the has been named president of Lenox board of directors of the Ross School of plays, subtle Brands (Lenox, Dansk and Gorham). Business Alumni Club of Southeastern racism and Lenox Group Inc., established in 2005, is Michigan. You can reach her at cfarley0524@ ferocious a U.S. market leader in quality tabletop yahoo.com. agenda set- items, gift ware and collectibles. Lesa for- ting revolv- merly was president and general manager Lee Meddin, MBA ’93 ing around of Honeywell’s special chemicals business. was included in a feature in the June issue noted artists. Aft er Honeywell, Lesa established her of Treasury and Risk Management maga- Currently own consulting business focused on post- zine titled “100 Most Infl uential People in Andy is merger integration while continuing to Finance.” Lee was listed with fi ve others founder and pursue her fi ne arts degree. Preceding her in “Artists of the Deal,” including the president of Creative Growth Group, a experience at Honeywell, she was with CEOs of Merrill Lynch and Goldman marketing consultancy. He has worked McKinsey and Co., DuPont and Ford Sachs, as well as the founding partner for Ziff Davis Publishing, BellSouth and Motor Co. At Lenox, Lesa is responsible of KKR. A text version of the article can Egon Zehnder Global Executive Search for the wholesale channel, product devel- be found at www.treasuryandrisk.com/ Firm. Andy has been married for 18 years opment, marketing and supply chain issues/2006_06/careers/536-1.html. You and has two daughters, ages 11 and management. can fi nd some other recent articles featur- 4. He serves on the ing work Lee has been involved with at board of direc- Timothy A. Wild, MBA ’89 www.ifc.org/structuredfi nance. Lee lives tors of the Anti- has been selected by Gordon Page & Asso- in Potomac, Maryland, with his wife Eri- Defamation ciates, America’s premier automobile ka and 18-month-old son Samuel. You League, Atlanta dealership business brokerage and con- can contact him at [email protected]. College of Art and sulting team, Museum of Con- to establish a Joseph Medlin, MBA ’93 temporary Art of new Ohio is VP, Finance, IT & Administration for Georgia. You can offi ce for the Altea Th erapeutics in Tucker, Georgia. reach Andy at fi rm. Tim Joe reports that Altea Th erapeutics has [email protected]. has worked been named a winner of a Georgia Bio- with auto medical Partnership Deal of the Year Vincent L. Barker, BBA ’85 dealers across award for a venture-capital fi nancing has received a Center for Teaching Excel- the U.S. for that raised almost $33 million, the largest lence Award at the University of Kansas. nearly two VC deal in Georgia in 2005. In addition, He was one of 20 faculty members campus- decades as a commercial banker, fi nancial ground was broken early this year for wide to receive the honor in 2006 based on consultant and intermediary. He has ac- Technology Enterprise Park, a new a poll of KU students about faculty mem- complished numerous dealership acquisi- 11-acre bioscience R&D park affi liated bers’ positive infl uence as teachers. He is tions and divestitures during his tenure with Georgia Tech University. Altea an associate professor of strategic man- with Chrysler Financial, Comerica, Th erapeutics has signed on as the anchor agement and Scupin Research Fellow at AmSouth, Bank One/Chase and Battelle tenant. You can reach Joe at jmedlin@ the University of Kansas School of Busi- Financial Advisors. You can reach Tim alteatherapeutics.com. ness. He lives in Lawrence, Kansas, with at [email protected]. his wife Kathy and sons Vinnie and Jake. Ben Zainea, You can reach him at [email protected]. Catherine Piner Farley, BBA ’92 BBA ’96 joined Telemus Capital Partners LLC as was voted David Han, MBA ’85 controller in April, where she is respon- into mem- is president and COO of Pangborn sible for fi nancial operations and report- bership Technovations of Ann Arbor, which has ing. Catherine previously was the CFO/ in the law developed a processing device that the VP of Finance at H&R Block Financial fi rm Mika, company claims is four times faster than Advisors/OLDE. She is a CPA and resides Meyers, the fastest personal computer chip on the in Canton, Michigan. Telemus Capital Beckett & market today. “Potentially, this could turn Partners is a private investment manage- Jones PLC a PC into a supercomputer at a low cost,” ment fi rm, based in Southfi eld, off ering in Grand Rapids, Michigan, where he says David. John Won Park, a professor independent specializes in mergers and acquisitions, and scientist at Chungnam National Uni- fi nancial general business, franchise, banking and versity in South Korea, invented the chip. advisory real estate law. Ben, who received his David explains that the innovation in- services law degree from the University in 1999, volves the way in which the company uses for high- serves as president of the U-M Club parallel processing. net-worth of Grand Rapids. You can reach Ben at individuals, [email protected]. families, businesses

dividend 51 fall 2006 CLASS NOTES Craig S. Gilden, MBA ’00 Derek Flowers, MBA ’01 has been promoted to senior vice presi- Amin Khakiani, MBA ’97 recently fi nished co-authoring a book dent and managing director of Wells successfully launched his own indepen- on working in large organizations. “Our Fargo’s proprietary investment group. dent portfolio management fi rm in 2004. book, Create SPACE, helps people see organizations in a new way. Using terms He serves as manager of the 20-member Using a pension fund/university endow- such as ‘friction,’ ‘heat’ and ‘useful work,’ research team generating investments ment approach to investing, his portfolios we use physics to explain organizational involving high-yield and high-grade have broad diversifi cation and risk man- behavior,” says Craig. “Th en we off er con- corporate bonds and bank debt, credit agement, and have returned in excess of crete methods and approaches for success derivatives and equities. He and his wife 30 percent over the past two years. You within organizations.” You can reach Katrina live in the San Francisco Bay can reach him at [email protected]. Craig at [email protected]. area with their two children, Kaitlyn and Austin. You can reach Derek at fl owersd@ sbcglobal.net.

the plane, in the airport, wherever.” She attributes a lot of her success — Playing to Win in Kosanke’s on the fast track to becoming a director — to the business school. “Th e collaborative environment and focus on communication skills helped prepare me the Boardroom for where I am today,” she says. Kosanke tries to make it back to Mich- igan for reunions and soft ball games as and on the Field much as possible and says her athletic experience here was the single most infl u- ential and challenging time of her life. igorous, fast-paced and cut- “You can’t escape the soft ball tradition throat — a typical game for rugby at Michigan. It’s a family and you never R player Pam Kosanke, BBA ’00, forget,” she says. whose time off the fi eld bares a striking Although her schedule can be gruel- resemblance to her time on it. ing, Kosanke has enjoyed the benefi ts of Kosanke, a former captain and Aca- competing internationally. “I have friends demic All-American soft ball player for all over the world, and anywhere I play, I the University of Michigan, is an account always have someone to stay with or come supervisor for Leo Burnett Advertising watch my game.” in Chicago and is in her fi ft h year playing Despite her passion for rugby, Kosanke in the backline for two U.S.A. women’s has her sights set on other ventures. “Aft er rugby teams. the World Cup this fall, it may be the cul- Balancing two full-time jobs comes mination of my rugby career and I’ll have easily for Kosanke, who also found time to ask myself, ‘Is it time to move on?’” to coach rugby at a charter high school Pursuing a master’s degree, starting her for three years, teach spinning and play own business and coaching have all crossed for four other local and regional club her mind. “I’d love to fi gure out a way to rugby teams. feasibly mass produce healthful food as “I’m in such an incredible situation,” says an alternative to the 99-cent cheeseburger. Kosanke, who never thought she’d end I’ve also thought about a nonprofi t career up in advertising, let alone playing rugby like fundraising for women’s athletics,” aft er a long and rewarding soft ball career she adds. (friends introduced her to the sport.) Th e future holds many possibilities for “My laptop is with me all the time. Kosanke. For someone who can be seen It’s not a nine-to-fi ve job — I’m never tackling an opponent in Hong Kong on really ‘off ,’” says Kosanke, who adds that a Monday and presenting a competitive it’s a lifestyle she has accepted. analysis to a high-profi le client in Chicago Th e key to her juggling act was to on Tuesday, it’s fair to say this Ross establish good relationships with her School grad is ready to take on — and colleagues and clients. “Th ey’ve been very conquer — whatever comes next. understanding,” she says. “Teammates have caught me working and checking e-mail Heather Thorne at 3 a.m. when I’m on the road. I work on

dividend 52 fall 2006 Consulting for the Greater Good

hen Samantha Lasky, MBA search in public-private partnerships and ’03, left Rochester, New York, working with nonprofi ts. Th is was not W aft er high school, she landed a good time for those endeavors, but I in the Steel City at the University of Pitts- decided to move back to D.C. Rick (now burgh and has been a Steelers fan ever my husband) and Tara Smith, MBA ’03, since. Between her junior and senior who also moved to D.C., encouraged years, Lasky interned for Congressman me to make consulting my business. So John LaFalce and fell in love with politics I named myself, started telling people I and the “rush.” She joined a campaign was a consultant and have been busy ever Samantha Lasky, right, with former fi rst lady training program chaired by Senator Bill since,” laughs Lasky, whose company can Rosalynn Carter. Bradley, Governor Ann Richards and be found at www.sjlgroup.com. Governor Richard Celeste. Lasky says the MBA program’s credo to Says Lasky, “My candidate didn’t win, develop leaders with a global conscience ask tough questions and fi nd innovative but I moved to D.C. anyway and found extends far beyond the walls of the school solutions. a temporary contractual job working for and corporations. “With the economy “As an alum, I help with recruiting and a trade association. When that ended, I continuing to change, providing more admissions work in D.C. I also recently was went to work for Baxter Healthcare and nonprofi t opportunities to students is invited to join the Ross Women’s Council ran its political action committee and another way the Ross School can adapt Networking Committee. When I chose grassroots programs for two years. Th en to changing times and be a leader,” asserts Michigan for grad school, I liked the stu- Bill Bradley decided to run for president.” Lasky, who has worked with large and dents I met at recruiting events. Th ey When the Bradley campaign ended, Lasky small nonprofi ts and foundations on is- made it clear that people with all types of joined Ketchum Public Relations. But she sues such as mental health, education, work experience would be welcome and soon decided she needed more training caregiving and the environment. Her that diff erent backgrounds are valued. I and applied for the MBA program. work with such organizations as College found this respect for diversity and the She spent her MBA summer internship Summit, the Ewing Marion Kauff man astounding camaraderie to hold true at Medtronic doing marketing. “It was a Foundation, FamiliesUSA, the Rosalynn throughout my entire stay at Michigan.” great job and great company, but it wasn’t Carter Institute for Caregiving and the Fred Wessells for me,” says Lasky, “So I started my job World Resources Institute has led her to

Matthew Danielle E. originally from St. Clair Shores, Michi- V. Horning, Shainbrown, gan, in November 2005. Sima is a Man- MBA ’01 BBA ’01 hattan-based strategy consultant with was appoint- has been Booz Allen Hamilton, working primarily ed treasurer hired as an with the Department of Intelligence. of the city of associate with Timothy is a principal with the commer- Ann Arbor Rupp Baase cial real estate fi nance group of Banc of on February Pfalzgraf America Securities LLC in Manhattan. 1. Prior to Cunningham Th ey reside in Darien, Connecticut. You that, he & Coppola. can reach them at [email protected]. served as fi nancial manager for the city’s She is a litigation attorney who focuses community services area. He has been a on commercial litigation and insurance Renata Kosova, PhD ’04 city employee since his undergraduate defense. During law school at SUNY at was awarded the Gunnar Hedlund Award days in 1989, when he started as a cashier Buff alo, Danielle was a student law clerk for the best PhD thesis in the fi eld of at the municipal golf courses. As trea- for the Hon. William M. Kretny in the international business: Do Foreign Firms surer, Matthew is responsible for collect- U.S. District Court for the Western Dis- Crowd Out Domestic Firms? Evidence ing and disbursing tax and other revenue, trict of New York and business editor for from the Czech Republic. Stockholm managing the city’s investment portfolio, the Buff alo Law Review. School of Economics Professor Orjan banking and risk management activities. Solvell, chairman of the jury, stated, “Re- He lives in the Ann Arbor area with his Sima Patel, MBA ’03 nata Kosova has written a novel piece in daughters Katherine and Anna. originally from Scarsdale, New York, was the heart of the fi eld of international busi- married to Timothy Mackey, BBA ’93, ness. Th e issues of competitive dynamics,

dividend 53 fall 2006 CLASS NOTES meeting in Oslo, Norway. You can reach (see www. Renata at [email protected]. tebeau.com). fi rm survival and foreign entry into a Colleen is domestic market are central to interna- John O. Renken, MBA ’04 enjoying tional business research, particularly the is a partner with Hawkins Delafi eld & getting in-

fi eld of host country impact. Renata’s Hood LLP in Washington, D.C. You can PRESS ASSOCIATED volved in the work sheds new light onto these issues.” reach John at [email protected]. University A major strength of her dissertation is the of Michigan originality of the topic and the extensive Colleen Newvine Tebeau, MBA ’05 Entertain- empirical work involving more than 6,000 relocated to New York to become deputy ment Coali- domestic fi rms over an eight-year period. director of U.S. newspaper markets tion’s New York chapter and in the Ross Th e award was presented at the European for the Associated Press. Her husband Alumni Club of New York. You can reach International Business Academy annual John, who graduated from LSA in Colleen at [email protected]. 1986, is an artist and graphic designer

OBITUARIES which he continued to attend well into his his daughter Laura Marr Baur, and sons late eighties. Both he and his wife loved Louis, John and Joseph, as well as a large staying in contact with people and fi lled extended family throughout several states. Hugh Mallick their lives with family and friends of many generations. Hugh was a founding MBA ’38 member of his parish church in Silver Gary Lichtenstein died in Silver Spring, Maryland, on March Spring in 1961 and maintained his mem- BBA ’00 27, 2005, at age 92. He was born to a railroad bership in the Knights of Columbus. He died in October 2003, at age 24, aft er family in Jamestown, North Dakota, and and Lucille were sponsors of several courageously fi ghting glioblastoma, the graduated from Jamestown College in 1934. priests and Catholic educational pro- most common and aggressive type of His fi nal MBA project was “A Method of grams. He was predeceased by Lucille in brain tumor. His family waited to make Isolating Sinusoidal Components in Eco- 1994 and his son Gerald in 1995. the announcement until they created a nomic Time Series,” which he translated foundation for glioblastoma research in to “Margin of Error” using his wry sense Gary’s memory called Voices Against of humor. Hugh worked for several com- Louis Marr Brain Cancer (www.voicesagainstbrain- panies in accounting and auditing positions MBA ’49 cancer.org). Gary, an entrepreneur and prior to World War II, including General leader, was a well-respected, dedicated Mills and Montgomery Ward in Minnesota. died of natural causes on March 6 in Ann and skilled trader at Wolverine Trading He worked during the war with the Army Arbor. Lou attended Milwaukee public in Chicago. “Gary redefi ned the words Air Corps in its fi nance department, and schools and graduated from the Milwau- ‘courage’ and ‘faith’ for all of us,” said his then attended the Armed Forces Indus- kee State Teacher’s College in 1938. He brother Adam. “He embraced life with a trial College before being stationed in Salt became an elementary school teacher in vigor that made all who knew him look Lake City, where he married Lucille Juckem, Grosse Pointe, Michigan, where he met at their own lives from a diff erent vantage whom he had met in Minnesota. fellow teacher Harriett Beyer in 1939. point. Instead of succumbing to hopeless- Aft er the war, Hugh was employed with Th ey were married in 1942 while he was ness, he made each day feel like a gift .” the Federal Housing Administration (later stationed in Blythe, California, for train- Glioblastoma attacks approximately the Department of Housing and Urban ing in the U.S. Army Air Corps prior to 40,000 people each year. “Because of the Development). He spent most of his ca- his deployment to England and France as urgent need for a cure,” explained Adam, reer traveling the country reviewing HUD a communications offi cer in the 409th “my family has created this foundation to projects, and he was extremely proud that Bomber Group. When he returned from advance the progress toward a cure and he spent time in every U.S. city with a popu- the war in 1946, Lou and Harriet settled support the medical research and clinical lation of more than 50,000. He retired in in Ann Arbor, where he completed his trials critical to the eradication of this 1973. Aft er retirement, Hugh and Lucille MBA and they raised fi ve children. disease. Th e foundation also will help were active gardeners and antique lovers, Lou’s career took him daily by train to fund the various wellness programs that and traveled extensively to visit family Detroit, where he served on the staff of assist patients struggling with brain tu- and friends and see national historic and the Detroit Board of Commerce, then as mors and their families. It is our hope that geographic sites. He started doing exten- editor of the Detroiter magazine and as a the work of this foundation can continue sive genealogical research in 1975 aft er senior legislative analyst until his retire- the legacy of courage, persistence and the death of his daughter in a parachuting ment in 1978. He also continued a career determination that Gary showed.” accident, and continued that for most of in the armed services by serving in the U. the rest of his life. S. Air Force National Guard, retiring as a Hugh had a lifelong fascination with Lt. Colonel. He spent the rest of his life trains and traveled by rail whenever pos- devoutly involved with his family, golfi ng, sible. One of his favorite trips was to the reading and Michigan football and basket- periodic reunions of his Army group, ball. He is survived by his wife of 63 years,

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 Alumni Network Update Keep your contact information up-to-date with the business school alumni community. Fill out the form below and mail it in the attached envelope or update your information online at www.bus.umich.edu/Profile.

NAME & DEGREE(S) BUSINESS INFORMATION

Name Title

Name while at School Company

Degree 1 & Year(s) Address Line 1

Degree 2 & Year(s) Address Line 2

City, State, Zip HOME INFORMATION LEADING Phone

Address Line 1 Fax

IN Address Line 2 I consent to posting the information I have provided above in the Alumni Directory, on my password-protected class City, State, Zip Web site (if one exists) and in Dividend alumni magazine. E-mail contact information Phone Business contact information Preferred E-mail Home contact information

GET CONNECTED Whether you’re interested in I am willing to advise the following groups Prospective Students seeking a leadership position regarding the business school experience Current Students (All Degrees) with the Ross School of and/or career opportunities. Check all that Alumni Business or available for just apply. Please note your e-mail, home and a few hours a month, we business contact information may be have an opportunity for you released for this purpose. Please note your industry/function to get connected!

DIVIDEND CLASS NOTES Send us your class notes, personal updates, promotions and photographs to [email protected], or include below and fax to 734.647.2401. We look forward to hearing from you!

THOUGHT

AND

ACTION Hey! You don’t have to yell.

To stay in touch with your Ross School classmates, just respond in one of the fast and easy ways listed below.

1. Mail 2. Fax 3. E-mail Complete the form on You can also fax the Our address is the previous page and form to 734.647.2401. [email protected]. mail in the envelope included in this magazine. NONPROFIT ORGANIZATION U.S. POSTAGE PAID ANN ARBOR, MI PERMIT NO. 144 701 Tappan Street Ann Arbor, Michigan 48109-1234

Join us Wednesday, September 27, as we unite alumni across the globe in celebrating Widen Your World the fi rst annual Worldwide Club Day. Th e event, designed to welcome new alumni to their communities, will include networking, September 27 student recruiting, community service projects, career development workshops, alumni seminars and faculty lectures. Find out more about activities in your area by visiting www.bus.umich.edu/ClubDay.