MARRIOTT ALUMNI MAGAZINE
Entrepreneurs: Taking Healthy Risks Crisis of Confidence Managing Continuous Change
MARRIOTT SCHOOL OF MANAGEMENT | BRIGHAM YOUNG UNIVERSITY | WINTER 2003 2003 marks the 20th anniversary of the Tanner Building—the first academic struc- ture on the BYU campus funded completely by donors. The building is named for successful businessman, Apostle, and three-time counselor in the First Presidency of The Church of Jesus Christ of Latter-day Saints, Nathan Eldon Tanner. The 120,000-square-foot structure is home of the Marriott School and serves 3,000 graduate and undergraduate management students and about 200 faculty, staff, and administrators. The building has a seven-story atrium and is finished in Rockville White Granite from Cold Springs, Minnesota. CONTENTS
alumni exchange speeches at work special feature trends
what tactics do you recommend to manage excessive stress?
responses from building a family crisis of taking healthy risks— Managing 34alumni legacy: the 8 confidence 12 experiences of four 18 continuous marriott story An interview with fraud marriott school change By Richard E. Marriott expert W. Steve Albrecht entrepreneurs By Christopher By Grant R. Madsen B. Bingham
NEWS
2 dean’s message 28 alumni news Entrepreneurship: The Modern Pioneer Spirit Fraser Bullock is named the Marriott School’s 2002 By Ned C. Hill Honored Alum. Alumnus is featured in Worth maga- zine, accountancy graduate receives highest CPA score 23 school news in Oregon, and an alumna competes in the Miss The Marriott School earns high rankings from The Wall America Pageant. This section also includes Street Journal and Business Week. CIBER changes name to Management Society news and class notes. Global Management Center and offers certificates for undergraduates. Faculty receives awards and recognitions, and thirteen new faculty members are introduced. Cover and inside cover photos by Bradley H. Slade.
Visit Marriott Alumni Magazine online at marriottmag.byu.edu nder the inspired leadership of Our way of life today is a testament to ate, or even nonbusiness students—all U President Brigham Young, the the successes of yesterday’s entrepreneurs: BYU students can participate in entrepre- Mormon pioneers left the known and cell phones, personal computers, modern neurship programs. established world of the settled United agricultural products, CAT scans, cancer The center teaches the principles of States to venture into the largely treatments, etc. entrepreneurship through many different unknown frontiers of the West. They Entrepreneurship is the pioneering channels. Each semester the center spon- faced unimaginable challenges. Where spirit, and it’s a natural theme for the sors a lecture series featuring entrepre- would they find water? How would they Marriott School. Not only is the university neurs with fascinating stories. They share grow food in the harsh climate? Where itself named after the great entrepreneur with students both their successes and would they get the supplies they needed? Brigham Young, the school is named for failures. The center also offers courses in How would they take care of medical entrepreneurs J. Willard and Alice S. entrepreneurship. Each year the center problems? How would they protect them- Marriott. This illustrious couple started a sponsors a popular student competition selves against the elements? little venture in Washington, D.C., selling for new ventures. It offers cash prizes and critical reviews by entrepreneurs and sea- soned investors. One or two ideas regular- ly evolve into real ventures. Entrepreneurship: A few years ago, for example, an MBA student, Jonathan Coon, wrote a proposal The Modern to sell contact lenses over the phone and the Pioneer Spirit Internet. The proposal was well received and some angel investors determined that by dean ned c. hill the idea was worth an investment. Within a couple of years, 1-800-CONTACTS became a multi-million dollar company! Some entrepreneurs give students internship In spite of seemingly insurmountable ice cold A&W Root Beer. Later, they experience, while others serve as mentors challenges, they came forth by the thou- added hot chili and tamales to their for students, advising them on career paths sands having faith in themselves, in their menu, grew the business into a restaurant and critiquing resumes. leaders, and in God. And they succeeded chain, and then used the proceeds to The center is also a magnet for faculty marvelously. Thriving cities, communi- found the world-renowned Marriott providing material for writing business ties, and families all across the West are hotel companies. cases, funding research projects, and even living tributes to their achievements. In addition, the Marriott School is helping to launch successful start-ups. Today’s business entrepreneurs are in housed in the Tanner Building, named Faculty are also involved with students in many ways the modern equivalents of after President N. Eldon Tanner, a coun- field studies. These are consulting projects those hearty pioneers. Indeed, one would selor to four Church presidents. Before he completed by a team of students who be hard pressed to find a greater entrepre- became a General Authority, President work with a faculty expert to solve a well- neur than Brigham Young. He led the Tanner led the largest and most successful defined business problem. founding of hundreds of business, agri- entrepreneurial venture in Canada (to The school’s Entrepreneurship cultural, and educational ventures and that time at least)—the trans-Canadian Center has been so successful that it has established hundreds of settlements from pipeline project. There are few universi- generously helped establish similar pro- southern Canada to the Mexican border. ties in the country that can boast such grams at our two sister institutions, Like Brigham Young and the early outstanding entrepreneurial namesakes as BYU—Hawaii and BYU—Idaho. In addi- pioneers, modern entrepreneurs leave BYU’s Marriott School. tion to funding support to jump-start the comforts of established organiza- To convey this pioneering spirit to our entrepreneurship programs on both tions and known business practices and students, the Marriott School established campuses, a business plan competition venture into the unknown frontiers of the Entrepreneurship Center in 1989. The has been held at BYU—Hawaii for the new and untested ventures. They, too, are center has become one of our most past three years. Marriott School entre- faced with often unimaginable risks. Will vibrant programs. Under the energetic preneurs visited the Laie, Hawaii campus anyone buy this new product? Where will leadership of Donald H. Livingstone, for several days to judge the plans, I obtain the funding to grow and to meet assisted by able staff and volunteers from instruct students in entrepreneurship, payroll? What are the legal minefields the entrepreneurship community, the and award the plan winners. I’m venturing into? In spite of these center provides students with resources to Entrepreneurship is the pioneering sometimes daunting challenges, entre- help them understand the principles of spirit. It will always be an important part preneurs go forth risking all to bring new entrepreneurship. It doesn’t matter of the learning experience for Marriott ideas to fruition. whether they are graduate, undergradu- School students. m
2 MARRIOTT ALUMNI EXCHANGE
A forum for alumni to share ideas about challenges facing Marriott School graduates. what tactics do you recommend to manage excessive stress? industrious alaskans have developed 2) Have an eternal perspective. Think Marriott Alumni unique stress management techniques. about what life will be like in the hereafter. Many employers in the northern region No doubt you will see the stressors of life Magazine give employees “subsistence leave” as a in a new light. Focus on those things that negotiated benefit. How do the thrifty are most important and that you can con- winter 2003 natives use their subsistence leave? They trol. Reexamine your priorities and plan prepare for the cold months ahead by accordingly. Don’t take yourself too seri- drying and packaging hundreds of fish ously. It will all work out. Ned C. Hill, Publisher and enjoy family time together handpick- 3) Consider change. Sometimes you may Joseph D. Ogden, Managing Editor ing quarts of blueberries. need to change your environment perma- J. Melody Murdock, Editor This annual ritual gives us four useful nently by changing jobs, neighborhoods, Byron Bronk, Copy Editor insights to skillfully manage stress. or friends. You may also consider more Jeremiah Simpson, Art Director 1) Plan engaging ways to stockpile temporary changes like going on vacation Emily Smurthwaite, Assistant Editor necessities. You may initiate a small finan- to see things in a different way. Sometimes Jenny Stathis, Contributing Writer cial venture, plant a garden, learn new you may need to change you. Prayerfully Michael Johanson, Contributing Writer skills, or listen to and read uplifting and consider possible growth areas and Jessie Christensen, Contributing Writer motivating media. Target your plan to options. Sometimes you need to weather Nina Whitehead, Contributing Photographer relieve specific stresses in your life. the storm and exude the patience of Job 2) Invite family and friends to take before you will see the purpose and bless- Published by the Marriott School of part in this process. Loved ones give ings of the stresses in your life. Management at Brigham Young University, moral support. Your outward invitation Provo, Utah. Copyright 2003 by Brigham to them is therapeutic in practice. David Tietjen, MBA ’88 Young University. All rights reserved. 3) Craft the experience as essential Ogden, Utah with high anticipation. Nature has priori- All communication should be sent to tized food for the body. You can master as you watch people who thrive Marriott Alumni Magazine “time” to discipline man’s nature. Alaskans under horrendous pressure, you will 775 Tanner Building must canvass the tundra for berries and quickly discover their source of strength. Brigham Young University fish the streams for salmon in an exact sea- They don’t thrive because they experience Provo, Utah 84602-3187 son or the opportunities are lost. stress, squeeze a beanbag, and then fall Phone: (801) 422-5083 4) Gain the perspective that compara- back into control. Most don’t feel stress in Fax: (801) 422-0501 ble stress in others’ lives is manageable. the first place. Email: [email protected] This perspective makes hope an essential Why? They know how to handle cru- step in managing excessive stress. cial conversations. When facing an appar- ent debacle, they don’t whip themselves Frank L. Barrus BS, ’85 into a frenzy by assuming the worst of oth- participate in alumni Nome, Alaska ers. Instead, they assume the best and then exchange: seek data. When faced with people who are Next issue: What’s the best way 1) take care of yourself. make sure about to blow a gasket, they know how to to initiate and sustain a mentoring all important aspects of your life are bal- calm troubled waters. Doing so, they avoid relationship? anced. Physically, you need exercise and the viral qualities of strong emotions. adequate nutrition and sleep. Emotionally, Finally, they know how to express Due: 15 February 2003 you need supportive, close relationships their strong opinions in a way that’s per- Length: 100–150 words and things you are passionate about. suasive, not abrasive. By avoiding heated Each submission should include: Spiritually, you need to develop a closeness arguments, they keep emotions in check. · Name and contact information to God and nature and to enjoy the bene- In sum, learn how to master crucial con- · Graduation year and program fits of losing yourself in the service of oth- versations, and cut off stress at the source. ers. Take time to meditate, ponder, and Email responses to reflect. Intellectually, you need activities Kerry Patterson BS, ’70; MOB, ’76 [email protected] that excite and grow the mind. Orem, Utah or send to above address.
winter 2003 3 the marriott story by Richard E. Marriott
my family and i are very proud to have our name associated with this great school—not only because it’s a terrific educational institution, but because we espouse similar values. my purpose today is to give you an appreciation of what marriott values are and what they mean to me. the best way to do this is to share a little family and corporate history. they are both about the same. The Marriott companies most people know and rec- ognize today are: Marriott International, of which my brother, Bill, is the CEO and chairman; and Host Marriott, of which I am chairman. Both companies Tcame from the original Marriott Corporation, which began as Hot Shoppes, Inc. My father, J. Willard Marriott, was the founder After arriving in St. Louis, William used his last few dollars to of it all. He was frequently asked, “What is the secret to your suc- pay for his passage on a wagon train to Salt Lake City. Elizabeth cess?” He invariably responded that three elements were integral had nothing left, so she worked for two years as a housekeeper to to his success: (1) being born right; (2) developing good habits; earn enough money to join a wagon train. Of course, in those and (3) marrying right. days when you joined a wagon train, you didn’t actually ride in a wagon—you walked alongside it. Unfortunately, she had only being born right one pair of shoes. She wrote in her diary, “I would not want to My father had two things going for him at birth: he was born in walk down the streets of Salt Lake City in worn-out shoes,”so she the United States, and he had good genes. He was blessed to live took those shoes, put them in her bag and walked barefoot so she in one of the few countries where, if you work hard and make would have good shoes when she got to Salt Lake City. She was a reasonably intelligent decisions, you can become successful. I strong-willed woman! serve on the board of the National Restaurant Association with After her trek across the plains, Elizabeth lived with her brother about ninety-five people who are very successful and well known in Kaysville, Utah. Shortly after she arrived there, she was stand- in the business world. Almost every one of them started working ing in the doorway of his home, looking out across a field, and as a dishwasher, table busser, or server in a restaurant and then saw a giant of a man on horseback coming toward her. She said worked up to management and often ownership. This great he was not very handsome, but the Spirit whispered to her, “This country in which we live gives each of us this opportunity. is going to be your husband.” I don’t think she was especially Secondly, my father had good genes, and a lot of those genes happy to hear that. His name was John Marriott, and about three came from his grandmother, Elizabeth Stewart. Elizabeth was born days later he approached her and said, “I’ve got the feeling you in Liverpool, England. She and her brother, William, were con- and I are to be married,”and so they were wed shortly thereafter. verted to The Church of Jesus Christ of Latter-day Saints. Their One of the products of that marriage was Hyrum Willard family was very poor and gave little support to Elizabeth’s and Marriott, my grandfather. William’s decision to join the Church and make the long, arduous trip to Zion, which was a fairly heavy expense in 1850. Elizabeth developing good habits had one possession of value—a beautiful shawl she received from My father, J. Willard, grew up on his father’s farm, just west of her mother—which she sold for enough money to book passage Ogden, in the small town of Marriott, Utah, which was founded on a ship sailing from Liverpool to St. Louis, Missouri. by his grandfather, John Marriott. As a young boy, he quickly learned how to work hard and take responsibility. He and his seven brothers and sisters had to take care of the crops and the livestock. As the eldest son, my dad had primary responsibility for the sheep and cattle. He spent so much of his time during his teen years tending them on the farm and herding them on the
winter 2003 5 Washington, D.C., area. Dad chose this area because he’d been there on his mission and knew how hot and miserable it was in the summer. He proposed to Alice and told her he would be back to marry her when she graduated. He left for Washington to make all the root beer stand arrangements and returned to Utah in May 1927 for the wedding. On the day they were to be married in the Salt Lake Temple, my father didn’t show up when the ceremony was supposed to start. He was trying to get his commissions from the woolen mills. He arrived at the wedding two-and-a-half hours late, with no money. He asked my mother, “Do you still want to marry me?” She said, “yes,” of course. His mother-in-law had the pres- ence of mind to cancel the wedding reception and give Dad the $200 they were going to spend for the reception. With that money, mom and dad jumped into his Model T Ford and start- ed their two-week drive to Washington, D.C. ranges of Nevada and Utah that he never graduated from high My mother was a tremendous partner to my father. She kept the school. He was called on a mission at age nineteen, and that pro- books for their new nine-seat restaurant, which opened up the day vided him the welcome opportunity to leave the farm and spend Lindbergh flew across the Atlantic, 20 May 1927. Every night she two years on the East Coast, preaching the gospel from would take the nickels, which were covered in root beer syrup, and Washington, D.C., to Maine. wash them in the kitchen sink (the bank wouldn’t accept sticky When my dad returned to Utah, he was able to talk his way nickels). She’d then put the clean coins into a paper bag and walk into being accepted at Weber College without having a high down to the bank around midnight to make the deposit of the school diploma. His second year of college is exemplary of the day’s revenue. She understood what it took to run a restaurant, and kind of worker he was. He was the salesman and writer for the she supported my dad throughout his career because she loved newspaper, the manager and stock boy for the bookstore, an him and appreciated the work he was doing. English teacher, and senior class president. I learned a lot of important lessons from my parents, many of After graduating from Weber, my father transferred to the which are the same ones you’ll be learning not only in the busi- University of Utah and worked in a food-catering business with ness world, but also at the Marriott School. Franklin D. Richards, who was to be one of his lifelong friends. During summers at the University of Utah, he earned his living success is never final selling black wool long underwear produced by a Utah woolen Change is what puts life in your business and in your life. The mill. Dad would go to the Northwest logging camps and sell this customer needs change constantly, and your business and you underwear for $20 a pair. That was a lot of money back then, so have to change to meet those needs. When my folks opened their he developed a special selling strategy. He would find two mean- root beer stand, they had one product: ice-cold root beer. That looking lumberjacks and challenge them saying: “Each of you worked great from May through September. October rolled take a leg of this pair of underwear. If you can pull this under- around and it got cold and rainy in Washington, D.C. Nobody wear apart, I’ll give you a free pair. If you can’t, you’ve got to buy wanted ice-cold root beer. The customers my father still had said, it.” The loggers would then have a tug-of-war but could never “Hey, you better get something hot in here to eat or you’re going tear the underwear apart. Dad earned more than $2,000 in com- to be out of business.” missions during a single summer and was the most productive Fortunately, my folks lived next to the Mexican Embassy. My salesman in the company. mother spoke a little Spanish and befriended the chef at the embassy. He gave her his secret recipe for chili and hot tamales. marrying right My father put up a new sign over the A&W root beer stand that In addition to succeeding as a salesman, my father also succeed- read, “Hot Shoppe,” and mother prepared their new Mexican ed in finding the right woman to marry. At the University of recipes. They served root beer, hot tamales, and chili in what was Utah, he met a young lady named Alice Sheets. She was eighteen now a “real” restaurant. It was a very explosive menu, but it years old and in her junior year. On one of their first dates, he worked, and provided the foundation for one of the largest took her to a little restaurant in the center of Salt Lake City. It was restaurant chains in the eastern United States a small orange and black box building selling one item—A&W root beer. My father was extremely impressed—not because he liked root beer, but because they had a line of people a block long waiting to buy this product. He was so excited that he jumped on a train for Sacramento, California to talk to Roy Allen, the “A” in A&W. Roy sold him a license to sell A&W root beer in the
6 MARRIOTT watch the details My parents taught me, my brother, and their employees to watch we must accept in order to live our lives successfully and be faith- the details of the business. I have vivid memories of visiting the ful to God’s teaching. Address issues, injustices, and inequalities Hot Shoppes as a small boy. In their book, In Search of that are present in our communities and society. Help improve Excellence, Thomas Peters and Robert Waterman were right on the present, and create a better tomorrow. target when they wrote about management by walking around. Your personal and business life should be spiritually strengthen- You cannot run a service business without walking around and ing, intellectually enlarging, character building, and service orient- seeing what’s going on in the operation. You can’t be in the office ed. Plan your career so you will do what you love and love what you looking at the books all day and know what’s really happening do. Do it in a way that will be pleasing not only to your earthly boss with your customers. and to your family, but to our Lord and Master as well. We must all My father would go out and talk to the customers, talk to the report to our Heavenly Father when our work is done upon the employees, and inspect the units. He believed that you can’t earth. That’s when we’ll find out the true measure of our success. expect what you don’t inspect. If you ask somebody to do some- Brothers, sisters, and friends, I wish you success at this fabu- thing and never go back to check and see if it’s done, it might get lous school. I’m honored to speak with you. There is no greater done the first time but it probably won’t get done thereafter. school and no greater group of young people on this continent You’ve got to get out there, check and make sure your associates than assembled right here in Provo. follow through on their commitments, and let them know you May the Lord bless you with the kind of success that will lead will be checking. Then you must show appreciation to people for to happiness during your stay upon the earth and eternal life in doing a good job. If they’re not doing a good job, explain how to the presence of our Lord and Savior, Jesus Christ. m do the job properly and give them encouragement. This article includes excerpts from a speech given by Richard Marriott at expect perfection the school’s graduate student orientation 29 August 2002. Expect perfection, and don’t cut corners. If you cut corners somebody will find out, and it’s usually one of your best cus- about the speaker tomers. My father’s inspections included tasting all the food, Richard E. Marriott is chairman of the board of directors for Host Marriott checking the temperatures of both the food and the equipment, Corporation. Richard joined Marriott Corporation full-time in 1965 as looking for dirt under and behind every piece of equipment, and manager of Hot Shoppes restaurants, having held part-time positions in the talking to the customers. He always said that you can’t be happy company since age fourteen. with an 80 percent positive customer response—it’s not good Richard is chairman of the board of trustees for the J. Willard and Alice enough. He said you can’t spill coffee on 10 percent of your cus- S. Marriott Foundation and the Marriott Foundation for People with tomers and expect to be successful in the restaurant business. Disabilities. He also serves on many boards, including the executive com- You must expect 100 percent satisfaction. You may not achieve mittee of the Marriott School’s National Advisory Council and the board of it the first time or the second time, but it should always be the directors of the Polynesian Cultural Center. goal you are striving for and the expectation you convey to your He is a graduate of the University of Utah and holds an MBA degree employees and your customers. from Harvard Business School. He is married to Nancy Peery. They have four daughters and thirteen grandchildren. lead a balanced life Don’t let your work hurt your family relations. Success is a lot more assured if your mind is free from family problems. If you’re happy at home, there’s a much greater chance of being happy at work.Be active in your church. Spiritual strength can be a great help. Don’t underestimate the value of being moved by the Spirit. When difficult decisions come, we need help, and it’s not always in the textbook, and it’s not always with your associates. Oftentimes we have to ask our Heavenly Father for help, and He’s willing to give it to us if we are living the commandments and are in tune with the Spirit. be active in the community Give back to the community. It makes you feel good. It makes your associates and employees feel good and have respect for you. It builds loyalty and morale. The customers love it. It’s a win-win situation. One of the basic tenets of the gospel is to serve the Lord and your fellow beings. Public service is an essential ele- ment of the society in which we live. It is a moral responsibility A1 Crisis of Confidence An interview with fraud expert W. Steve Albrecht Illustration by Steven Noble
Another change that has taken place is Assistant Dean Joseph D. Ogden discusses the growing the increase in the size of frauds. The impact of fraud with international fraud expert and Associate largest bankruptcy in history, up until the last couple of years, was around $25 bil- Dean W. Steve Albrecht. Albrecht has published more than lion. Now, Enron is at $63 billion and eighty articles in professional journals and numerous books WorldCom $102 billion. Four of the on fraud, personal finance, and accounting. Throughout his largest bankruptcies in history have involved financial statement or manage- career he has consulted for more than sixty-five organizations ment fraud. including British Petroleum, Bank of America, General Motors, IBM, the United Nations, and the FBI. In addition, he To what do you attribute has served as an expert witness in twenty-six major fraud the dramatic increase in cases, the largest of which was $2.8 billion. Finally, Albrecht fraud, particularly over the has been recognized by Accounting Today as one of the top past decade? one hundred most influential people in accounting. As I mentioned, a lot of these frauds have been going on before but weren’t detected until the economic slowdown. Beyond that, Several reports indicate that fraud—particularly corporate it’s corporate greed. Look at WorldCom’s fraud—has increased dramatically over the past decade. and Enron’s executives. They were making Reports not only show an increase in the number but also millions a year in salary but stood to make hundreds of millions in stock options. The in the size of corporate frauds. Has fraud really increased, stock price doesn’t go up unless earnings or are we just better at detecting it than we used to be? are consistently increasing. Wall Street and investment bankers project what a compa- Fraud is increasing. There have been two fact that frauds are easier to conceal in a ny’s earnings should be, and if companies monumental studies of financial state- strong economy. Many of the recently don’t meet those projections, they’re heavi- ment frauds. One was done in the early detected frauds were going on in the 1990s ly punished. 1990s on frauds detected between 1977 but were masked by the healthy economy. For example, Enron reported twenty and 1987. There were about 300. The straight quarters of increasing earnings
other study looked at the next ten years LARGEST BANKRUPTCY FILINGS when, in fact, their real earnings were sig-
and found about 325 frauds. Since 1997, COMPANY ASSETS (billions) WHEN FILED nificantly less than that and in many already more than 300 frauds have been WorldCom* $101.9 July 2002 cases losses. Because Wall Street penalizes detected. So, in the last five years there Enron* $63.4 Dec. 2001 firms that don’t meet earnings expecta- have been as many financial statement Texaco $35.9 April 1987 tions, there is enormous pressure to Financial Corp. of America $33.9 Sept. 1988 frauds as in the previous ten years. increase earnings, which often leads to Global Crossing* $25.5 Jan. 2002 Whether we are better at detecting it Adelphia* $24.4 June 2002 manipulating or “cooking” the books to than we used to be has a lot to do with the *Fraud related Source: USA Todayy 2002 meet forecasts.
8 MARRIOTT A2
Is fraud more prevalent in the United States than in Some in the United States believe the American system of accounting—most notably other developed countries? the rules-based system administered by the Financial Accounting Standards Board—is to blame for the discrepancies and deceit perpetrated on investors. Critics of the American system believe that moving to a principle-based system like that Compared to other developed countries, used in Europe would reduce the penchant many have for regulatory loopholes. fraud is more prevalent in the United States. There’s a German organization, Transparency International, that rates How seriously is the U.S. accounting profession corporate corruption in various coun- looking at moving to more principles-based tries. The corruption index is based on about thirty different surveys. The United International Accounting Standards (IAS)? States for the last few years has been ranked sixteen or seventeen out of about The United States has not been heavily stand up to their clients, I think princi- one hundred in the world. Canada ranks influenced by the IAS. International stan- ples-based standards would be better. It around seven or eight. The most honest dards are different and more principles- would be harder to rationalize if you had countries tend to be in Scandinavia— based. I doubt we’ll be adopting them in principles-based standards that every- Denmark, Sweden, and Norway. Less- the foreseeable future because most peo- body understood and complied with. developed countries tend to be closer to ple believe U.S. standards are higher. the bottom. This principles/rules-based contro- What would it take to move in that versy doesn’t have an easy solution. direction? Do you believe the United Some people argue that if we have more It would take a lot of people changing their principles-based standards it’s just easier belief structure. We’ve gone down this States is experiencing a to manipulate because there are no hard rule-based road a long time. Many people crisis of conscience? rules. The problem with rule-based stan- who’ve invested a lot would have to dards is you can’t have a rule for every- change. It’s not in the FASB’s best interest There’s a crisis of confidence for sure. thing. In a rule-based system, the audi- to have general principles-based standards. Whether there’s a crisis of conscience, I’m tor can’t say to the client, “You shouldn’t However, I think it’s in the best interest of not sure. I can tell you that a lot of action do it because there’s a rule against it.” financial reports and the country as a has been taken recently. We have the new But if it’s principles-based, the auditor whole. A lot of people don’t agree with me Sarbanes-Oxley Act, also called the can say, “You shouldn’t do it because it’s on this point. They believe principles- Corporate Responsibility Act, that has not in the spirit of the rule.” based standards would give people a many elements such as creating a new Overall, if auditors are willing to license to cheat more. I don’t believe that. oversight board for the accounting pro- fession and making executives sign off on the accuracy of their financial statements. There are many steps being put in sudden it seems like it’s everywhere. But The fraud triangle can explain any fraud place to minimize future fraud activities. it’s not. What we don’t think about is how there is. If it’s fraud against an organiza- Having said that, we will always see cor- many companies are out there. It’s like tion, the pressure might be,“I’ve got debts ruption, because there are a million dif- flying. People hear about a deadly air- I can’t pay.” The rationalization is, “There ferent ways to commit fraud and a lot of plane crash and are afraid to fly. They are poor controls in the organization, and greedy people willing to do it. may not think about the fact that there I’m going to pay it back.” are thousands of flights a day, and it’s still If it’s financial statement fraud for Is the crisis of confidence justified? the safest way to travel. example, the pressure might be, “We’ve Unfortunately, bad news gets all the got to meet Wall Street’s earnings fore- press. Bad press is dominating the news You’ve written about the cast.” The opportunity would be the and shadowing everything we do. By and plan, “We’ll bury these fictitious transac- large, we’re still a great system with fraud triangle—the role of tions in subsidiaries that the auditors mostly honest companies. Sure we’re in a perceived pressure, per- might not get to.” The rationalization is, bit of a recession right now, but most ceived opportunity, and “As soon as the economy improves, we’ll companies are going to survive and rationalization in commit- merge with somebody and create a become stronger. merger reserve where we can wipe this I think a lot of people have overre- ting fraud. How do these out.” People rationalize that as soon as acted. We hear about WorldCom, Enron, factors play out when fraud the economy improves they’ll stop com- Tyco,or Homestore frauds, and all of a is actually committed? mitting fraud.
winter 2003 9 A3
Do you feel government as well. For example, there’s a lot of For starters, we have excellent professors regulations, particularly the online auction, credit card, and identity who are marvelous examples. They’re new Sarbanes-Oxley Act, fraud that was never possible before. bringing the gospel and good values into the classroom. They are staying up-to- do much to reduce per- What is the Marriott School date and using corporate examples to ceived pressures, opportuni- teach lessons of integrity and to teach doing to prepare students to ties, and rationalization? students how frauds happen. We also deal with fraud issues? bring in business executives as lecturers The Sarbanes-Oxley Act is an effort to put some infrastructure in place to make companies act responsibly. The act creat- ed an oversight board, requires auditor Aside from the Sarbanes-Oxley Act, what do you rotations, and requires work papers to be think needs to be done to restore confidence? retained longer. It places more burdens on corporate executives. For example, you Unfortunately, the solutions are difficult. garten child today is about 1,000 words. can no longer leave a CPA firm and Some people are dishonest. Researchers When the baby-boomers started kinder- become a company executive right away. who have studied honesty, integrity, and garten the average was about 4,000 Certain executives in corporations have to moral development say there are two words. Children have decreasing vocab- sign off on financial statements. And, things to do if you want somebody to be ularies because they’re not being talked companies must have outside directors honest. Number one, you’ve got to model to.The average family spends ten hours with financial experience on their boards the behavior you want. In the corporate less time together per week today than in of directors and audit committees. world we call that “tone of the top.” In a 1980. Homes are no longer places where I don’t think we’ve done anything to family, we call it setting a good example. parents teach and train children, they’ve reduce pressures. We still have Wall Number two, you’ve got to label behav- become places where you pass each Street making earnings predictions and iors as acceptable or unacceptable. In the other in the hallway and say hi. companies giving tremendous amounts corporate world we call that a code of With little or no positive modeling, of stock options. In terms of opportunity, conduct. In a family, we call it teaching teaching, or training, children are grow- hopefully by having more diligent audi- and training. ing up and entering the corporate world tors, opportunities won’t be as great. As It’s very clear from research that when without a well-defined code of conduct. for rationalization, if top management the model and label or the example and They don’t know what’s right and wrong. has to sign off on the financial state- teaching are not consistent, you get a When the company CEO tells them to do ments and take responsibility for their behavior you don’t want. It’s like me say- this, or the chief financial officer tells accuracy, they can’t rationalize fraud as ing to my children,“Don’t break the speed them to do that, they rationalize and go easily as before. limit.” Then they get in the car with me, along. They say, “I’ve got this good job. and I drive eighty miles an hour with a I’ve got to keep it.” Have advances in techn- radar detector. My model and my label or The problem is there are a lot of peo- ology helped eliminate or my teaching and my example are not con- ple to blame. There have been honesty encourage fraud? sistent. The Savior was a great example, a studies in the United States for many perfect example. His labeling was para- years. We know that the percentage of Yes and yes. Advances in technology have bles, and His model was His example. dishonest Americans is increasing. It’s a made fraud easier to commit and easier to In today’s society productive model- very difficult trend to reverse. detect. We can now use deductive logic ing and labeling is diminishing. With and technology together to detect fraud. information so accessible, people are Is it possible to reverse that trend? I’ve done it with my son, Professor Conan exposed to a great deal of poor behavior If we’re going to reverse it, we have to Albrecht, as the programmer. that is modeled very vividly. Young peo- start at home. Then, educational institu- First, we identify the kinds of frauds ple are seeing more bad models, and tions have to pay attention. Business that could occur. Then, we identify the some of these models are our leaders: schools aren’t teaching ethics as much as symptoms those frauds would generate and executives, athletes, senators, and judges. they could or should. Few are teaching catalog them. Next, we use the company’s Not only are the youth being anything about fraud. Most of the people accounting systems and technology to exposed to poor examples, but they who participate in frauds and most of the search for these symptoms. When we find aren’t receiving the teaching to help auditors wouldn’t know fraud if it hit things that look like fraud, we build models. them determine what behaviors are them right between the eyes because they On the other hand, advances in tech- acceptable and unacceptable. I’ve heard haven’t been taught. I believe teaching nology have made fraud easier to commit that the average vocabulary of a kinder- about fraud will help reverse the trend.
10 MARRIOTT A4 and role models. being honest, so why should be. I’ve been engaged as an expert In addition, we have a fraud class at should I?” witness in cases to defend CPA firms and BYU. Now, a number of other schools started preparing only to realize the auditors are adding fraud classes. We also have This happens a lot. When top executives didn’t do a good job. When that happens, I several other classes that present stu- are dishonest other people in the organiza- resign from the engagement. dents with ethical dilemmas to help tion see it and justify their own dishonesty. them define who they are. An insurance fraud a number of years ago involved employees FRAUD INSIDE Where is the accounting Looking at situations like ORAGANIZATIONS creating fictitious people and ficti- profession headed? WorldCom and Enron, do tious policies and 25% you think it was really then selling those The accounting profession has been hit 10% their intent to manipulate 9% policies to reinsur- pretty hard and gotten a lot of bad press their earnings all along? 56% ance companies. lately. We’re down now to the final four One of the employ- firms, if you will. You may have recently
The common element of fraud is intent. Employees Owners ees in the company read that one of the big four has a $2 bil- Without intent, it’s an error. Sometimes Managers Others saw what was going lion lawsuit against it by the government. the intent starts fairly innocently and on and said, “We’re For many years, CPAs were at the top in grows gradually. That first amount of creating all these fictitious employees, I terms of integrity, objectivity, and respect. fraud committed usually offsets the sec- might as well get in on it.” It didn’t make Now, many people argue that we’re down ond period. The next period’s fraud sense to have them all live forever, so he there with used-car salespeople, lawyers, always has to be bigger. People who com- had a few of them die and collected the and members of congress. We lost a lot in mit fraud usually don’t realize that unless death proceeds. I’m an expert witness in a a short time in terms of our reputation as they can reverse it very quickly it’s going fraud case right now where there are more accountants. It’s going to take a long time to get really big. than twenty individuals involved in per- to get that back. The irony is, however, that GEOMETRIC GROWTH OF FRAUD* For example, one petrating the fraud. CPAs should now matter more than ever to of the easiest corporate executives. They place great con- 3.0 ways to commit fidence in their auditors before signing off 2.5 fraud is to over- on financial statements.
S Not only have CEOs been
N 2.0 O state inventory. If taken to task for duping 1.5 you overstate N BILLI I investors, but their 1.0 inventory, then How long do you think it 0.5 your gross mar- accountants and auditors gin and net will be before the markets 0 have also come under income are high- regain consumer confidence? YEAR 1 3 5 7 9 er. Inventory at intense fire. Should * Example from an actual case shows how early fraud detection can prevent the end of one corporate accountants and The problem with the markets right now huge losses. period becomes independent auditors be and consumer confidence is it’s not just the beginning inventory of the next peri- held to the same level of the frauds that are holding the market od, which has the opposite effect. So now down. In fact, they might be a fairly to commit a fraud you’ve got to compen- accountability as CEOs? small part of it. It’s a combination of the sate for that as well as double it the next unemployment rate, economic down- period. In most cases, frauds start small Despite what many people think, turn, and the indices we monitor all the and then grow geometrically. In accountants and auditors are rarely time. When people lose money, they tend WorldCom’s and Enron’s cases, they first involved in fraud. There are a number of to have less confidence in the system. used aggressive accounting methods lawsuits against auditors that I consider One of these days the economy is then managed earnings and finally com- frivolous. An auditor will never be able going to turn around, and as a result mitted fraud. to detect every fraud. They’d have to consumer confidence will rise. If you audit 100 percent of all transactions, be look at the market historically, we have Do you believe that fraud an interview expert, and be able to tell never had a period longer than twenty- when somebody is lying. Just because two months when the market’s been at this magnitude also somebody doesn’t catch a fraud doesn’t down. When it has recovered, it’s exceed- begets other fraud? People mean it is a failed audit. ed its previous high. We’ll still have think, “Well, nobody’s Having said that, I believe there are cases frauds, and the strong market will hide when auditors aren’t as diligent as they many of them. It’s cyclical. m
winter 2003 11
ntrepreneurship is, in many ways, E the lifeblood of our economy. Each year, more than half a million busi- nesses are started, and millions of jobs are created in the United States alone. Additionally, the entrepreneurial itch employed workers has actually fallen success. Common among them is a helps advance technology and diversifies since March 20012. desire to help others succeed, reliance on the economy. Experts attribute this recent trend to the gospel of Jesus Christ, and applica- The innate drive to create new ven- rising health insurance premiums, lack of tion of skills acquired at the Marriott tures and build new enterprises has led the readily available financing, and a decrease School. United States out of many recessions. in investor confidence. Despite such Discover Nathan Gwilliam’s path to According to a recent USA Today1 article, obstacles, many are still counting on start Adoption.com, one of the world’s in the previous nine recessions since 1948, entrepreneurs to nurse the economy back largest adoption media web sites; how self-employment rose as laid-off workers to health. Chris Lansing converted a local building started their own companies. This increase With a strong tradition of entrepre- supply company into the national Ted in businesses produced jobs and innova- neurship, Marriott School graduates are Lansing Corporation; what prompted tion, providing a vital shot in the arm to a reinventing traditional businesses and Marva Sadler to restart Baron Woolen floundering economy. creating innovative ventures—nourish- Mills and join new venture eLeaderTech; However, during the past two years, ing a hungry economy. and why Stephen Jenkins believes his new business startups have been slow to These are four stories of Marriott newest startup, CheatCodes.com, is hon- aid in the recovery. The share of all self- School alumni garnering entrepreneurial est work and a lot of fun.
winter 2003 13 “There’s a standard rule they tell you A HELPING BUSINESS in business school—the rule of threes,” Under Gwilliam’s leadership, Gwilliam says. “It will take three times as Adoption.com is now a profitable net- long, cost you three times as much, and work of more than two-hundred web sites generate a third of the money you think it related to adoption, foster care, infertility, will. That was pretty true.” and crisis pregnancy. Aside from catering Earlier that evening, he had decided to to people hoping to adopt, the grab something to eat before returning to Adoption.com network also serves the office to finish the business plan entry, women facing crisis pregnancies, adoptive which had to be postmarked that night families, adoptees, and birthparents. for competition eligibility. Popular sites include “Looking back, we were at a pivotal AdoptionWeek.com, an online magazine moment of the company,” Gwilliam says. sent via email weekly to 220,000 readers; > Nathan Gwilliam “We could very easily have folded. All the AdoptableKids.com, a photo listing with Adoption.com credit cards were maxed, and there wasn’t nearly 2,000 children in foster homes and enough revenue to meet our needs.” orphanages; ParentProfiles.com, a service PIVOTAL MOMENT On the way to dinner, his automobile allowing hopeful adoptive parents to build Banging on the doors of the post office at was rear ended—the first accident of his online profiles and pregnant mothers to 12:45 a.m., former BYU business student life. By the time he returned to work, got access those profiles; and Nathan Gwilliam couldn’t believe his the business plan in a workable state for AdoptionRegistry.com, the largest mutual- luck. Tired and overworked, he had post- submission, and drove to the post office, consent reunion registry that helps adult poned finishing a business plan entry he had missed the postmark. adoptees and birthparents find each other. until earlier that evening. Procrastination Standing in front of the post office’s Privately owned by Gwilliam and his had caught up with him. locked doors, Gwilliam noticed several father, the world’s biggest adoption After hearing about a U.S. West-spon- postal workers exiting the side door. media company employs twenty people sored competition with a $10,000 prize, Hoping for a miracle, he nearly pounced on and creates revenues from advertising, he resolved to give it a shot. His new com- them, passionately explaining his situation. directory listings of adoption attorneys pany, Adoption.com, had experienced “I told them it had to be postmarked and agencies, listings of parent profiles, minor success generating revenue before midnight. They told me, ‘It can’t,’” and from sales of adoption books, music, through advertising, adoption attorney he says.“I explained to them that this was to videos, and other products.“A lot of peo- listings, and parent profiles, but was still help kids get adopted, and it was for a real- ple said you couldn’t make money in the unable to meet its expenses. ly good cause.” His sincerity swayed them. adoption world,” he says. “But I knew it The company had just downsized “When they came back out—minus could be done.” and moved from Provo (where it started the package—they said, ‘You are so lucky. in 1995 in a BYU computer lab and won The lady in charge of turning over the GUIDING PRINCIPLES the BYU ACE Business Plan date stamp is having a baby shower, so she Important to his accomplishments has Competition) to Arizona, where hasn’t done it yet.’” been the foundation he gained in Gwilliam could save rent money living His entry properly postmarked, Marriott School classes. with his parents. The warm glow of CNN Gwilliam went on to win the competi- “Rick Farr’s marketing class was won- and MSNBC cameras that followed the tion. The prize money arrived in time derful,” he says. “It was so practical. I’ve young entrepreneur at the site’s launch for Adoption.com to pay critical obliga- used almost everything I learned there.” had faded, and the cold realities of run- tions and garner more media coverage. Key to his success is three principles ning a business remained. More importantly, it attracted the atten- upon which Gwilliam bases business tion of financiers. decisions: (1) Do the right things for the right reasons, and worry about revenue “It will take three times as long, cost you second. (2) Pay outright for everything needed to run your business, but make all three times as much, and generate a third of your revenue streams recurring. (3) of the money you think it will.” Give credit where it’s due. “We are very open in our business cul- ture that we could not do this without the Lord,” Gwilliam says. “He gets the credit, not us. We need to make all of our deci- sions in ways we can be worthy of that assistance.”
14 MARRIOTT > Marva Sadler creative problem-solving skills, which Sadler is mother to five children, ages Baron Woolen Mills and eLeaderTech involved finding simple, low-cost solutions. twenty-one to seven. And though she says “As an entrepreneur, in the middle of grow- it hasn’t always been easy, she follows a EYE FOR OPPORTUNITY ing a business, ‘I can’t’ is not an acceptable strict policy to make the two parts of her Struggling with humidity-related health answer,” she says. “There is a constructive life work the way she wants them to. concerns, strategy consultant Marva Sadler solution to almost every challenge.” “I tell my employer, ‘I work really left her job with consulting firm Marakon One creative solution involved scrap hard when I’m at work. And when I go Associates and moved her family from the yarn.Instead of figuring out how to just home, I’m home,’” Sadler says. “When East Coast to the drier climate of Utah. minimize the problem by reducing or recy- I’m home: I’m a Mom; I coach soccer; I Upon returning to the state of her child- cling, Sadler’s company reversed the situa- make Halloween costumes; I do the hood, she enrolled in a doctorate program tion and turned the scrap into a profitable things that Moms do—but when I’m at at the University of Utah in the fall of 1991. opportunity. The mill invented a blanket work, I’m at work.” She takes the gospel very seriously in “In the middle of a growing business, relation to her business and home life. ‘I can’t’ is not an acceptable answer.” The values and principles she holds clos- est—a deep sense of integrity and hon- “I quickly realized I was too entrepre- called the “Joseph” as in the “coat of many esty—have served as guideposts through- neurial to get my PhD,” Sadler says. “I last- colors.” According to Sadler, the blanket out her career. ed one semester.” Shortly thereafter, she was tremendously popular with its unique “I’ve walked away from jobs where I heard about the bankruptcy and closing of color weaves and also very profitable thought people were a bad influence or Brigham City’s Baron Woolen Mills— because it used all of the leftover yarn. “We where there were things that I didn’t want founded in 1870 by Church President never had to discount a ‘Joseph’ blanket to participate in. I can’t do one thing Lorenzo Snow. Marva saw an opportunity. because of a weaving flaw,” she says. eight hours a day and live the gospel the “I thought it would be exciting to take other sixteen.” all the principles I had taught other peo- ATTITUDES AND BEHAVIORS ple as a strategy consultant and see if I When she became pregnant with her fifth could make them work,” says Sadler, who child, Sadler developed an allergic reaction earned an MBA from the Marriott School to the wool and turned the company over in 1981 and went to work for Bain & to her husband in 1996. She moved on to Company after graduation. work for business training companies Sadler took the reigns as CEO and her AchieveGlobal and later FranklinCovey. husband, Bob, took responsibility for Sadler explains that even when she’s sales and marketing. Together, they devel- worked for larger businesses, she’s tended oped and executed a business plan to to behave in an entrepreneurial fashion. return the company to full operation in “Entrepreneurship is not just about run- eighteen months and profitability in ning or owning a small business,”she says. twenty-four. But the turnaround wasn’t “It also has to do with attitudes and always smooth. In a small-company set- behaviors. There’s a difference between ting, Sadler had to adjust her approach to the constant sense of urgency and creativ- doing business. ity that entrepreneurs have versus the “My consulting firm clients were bureaucracy and process that managers of Fortune 500 organizations with big prob- large businesses tend to fall into.” lems involving huge amounts of money. I She credits part of her success in the was accustomed to doing financial projec- business world to her time at BYU. “The tions and spreadsheets where $10 million Marriott School provided as good a clas- was a rounding error,” she says. “When I sical MBA education as anybody,” Sadler began running my own business, there was says. “In the business world I was able to no such thing as a rounding error—I start- put my strategy sense and certainly my ed struggling over things like, ‘Am I paying finance and operations understanding, seven cents or can I find five cents a minute against anybody else’s.” for long distance?’” During four years at the mill, she SENSE OF PRIORITY quadrupled production, improved the Today, when she’s not using her entrepre- quality of blankets, and reintroduced past neurial skills as chief operating officer of products. She says she learned to focus on Salt Lake City-based start-up eLeaderTech,
winter 2003 15 was in a tight spot. Plagued by high interest them with respect. Customers are our part- rates, the economy had ground to a halt. ners. Their success is our success.” Shortly after assuming his father’s role as president, Lansing, then thirty-years IMPORTANCE OF EXAMPLE old, got word that several of the compa- A former stake president, Lansing is also ny’s key leaders were defecting to go into active in the community, where he tries to business for themselves. be a good example. “It made for a very challenging time,” “Being a Mormon in the communi- Lansing says. “I didn’t feel like I was par- ty—a Baptist Bible-belt area—you “When you’re green you grow, and when you’re ripe you rot.”
ticularly ready for it. But it forced us to become very visible because of your reli- work hard, and I think it brought out the gion. The same holds true in the busi- best in us.” ness world,”Lansing says. “It’s an oppor- Bringing in other young guns to fill tunity to put the Church forward in a vacancies, Lansing earnestly began build- positive light.” ing the business. Under his leadership the Lansing says many great missionary company has prospered, with warehouses opportunities have resulted from the from Washington, D.C., and Atlanta to attention his company garners. He attrib- Salt Lake City and Seattle. utes the corporation’s continual expan- Marriott School Dean Ned Hill has sion and success to the Lord, saying it is a worked closely with Lansing, who serves tool to further missionary work. on the school’s National Advisory “Our family believes that where much Council, its Entrepreneur Founders Board is given, much is required. We’ve been the and on BYU President Merrill J. Bateman’s beneficiaries of so many blessings that we Leadership Council. feel we must give back.” “Chris is a wonderful entrepreneur. > Chris Lansing He’s very kind and personable to his peo- Ted Lansing Corporation ple but very demanding of quality as he expands his business,”Hill says.“An entre- Attributes of a VISION OF GROWTH preneur is someone who takes risks and “When we first started, we had six ware- develops new ideas, and Chris certainly Successful Entrepreneur: houses and $10 million worth of busi- does that.” ness,” says Chris Lansing, president of the Virgina-based Ted Lansing A PEOPLE BUSINESS • Willing to take risks Corporation. “Today, we’re at fifty ware- Lansing credits his company’s expansion to • Desires to compete houses and more than $200 million dol- the focus he places on personal relation- lars worth of business.” ships—those fostered with employees and • Handles stress well The 1974 BYU accounting graduate, customers alike. Additionally, the support CEO of the nation’s foremost indepen- he gets from his spouse in his business ven- • Makes work fun dent building products wholesaler, has no tures is something he believes is vital to any • Creatively solves problems plans to slow down. entrepreneur’s success. “To me, when you’re green you grow, “I like the opportunity of watching • Recognizes opportunities and when you’re ripe you rot,” Lansing people grow,” Lansing says. “We’re not a • Committed to the business says. “As we attract and hire new people high-tech business, we don’t have a secret we have to sell them on our vision that recipe, and we don’t make anything. We’re • Goal oriented the company can grow and that they will wholesalers. Ours is a service business, be able to grow along with it. If we don’t which means it’s a people business.” • Sense of realistic optimism give them those opportunities, someone Lansing considers himself lucky to be Dyer, W. Gibb. (1992). The Entrepreneurial else will.” the leader of so many dedicated and special Experience. San Francisco, CA: Jossey-Bass When Lansing took over the company people. “We hire friendly and train techni- Publishers. in 1980 upon the death of its founder and cal,” he says. “We expect our employees to namesake, the Ted Lansing Corporation know their customers’ names and treat
16 MARRIOTT > Stephen Jenkins WinFiles.com, a site that let people test WinFiles.com, VServers.com, and drive software via downloads and provid- CheatCodes.com ed informational articles about the Windows operating system. FUN ON THE JOB The articles became extremely popu- Thirty-one-year-old Stephen Jenkins is a lar—many web sites linked to them, and confident fellow—he has an engaging ver- most of the high-tech print magazines bal swagger that perhaps stems from the recommended them. Jenkins became an sale of two of his companies— unintentional expert on Windows 95 WinFiles.com and VServers.com—for a Internetworking almost overnight. combined $60 million in cash. And In the process of creating and main- though money doesn’t necessarily make taining WinFiles.com, Jenkins hired people the man, it certainly didn’t hurt the assur- to develop programs that dealt with adver- ance of a person who had the chutzpah to tising and marketing, content manage- ENTREPRENEURIAL ZEAL run for Provo mayor at age twenty-one. ment, and databases. Realizing the soft- With the financial independence the sales After taking a year off in 2000 to ware’s marketability, he and a fellow BYU of his two companies gave him, Jenkins recharge following the sale of his busi- student co-founded VServers.com, a Web started CheatCodes.com in 2001. The nesses, Jenkins became the “cheat” execu- hosting and e-commerce tools provider. Seattle-based company serves up more tive officer of CheatCodes.com, a compa- While Jenkins was running the two than 300,000 web pages daily, attracting ny he envisioned in 1996 that provides companies, Microsoft launched Windows about 200,000 visitors a week during slow video game enthusiasts with the secret 95 in August 1995. WinFiles.com was periods and almost double that during codes, hints, and tips to imbue game char- caught up in the media hype, and members the summer and on holidays. acters with even more super powers and of the Windows marketing team offered Currently, the site is free and makes a unlock hidden levels. Jenkins a job. He worked for them as an profit on advertising, but will eventually Jenkins’ company name sometimes online marketer following graduation. charge a minimal fee for some of its ser- raises eyebrows. But a quick explanation “I was working with people from vices, Jenkins says. In his free time, Jenkins enjoys lectur- “I love helping others catch the excitement ing about entrepreneurship to BYU stu- of what it’s like to own a business.” dents in Rexburg, Laie, and Provo, and makes an annual visit to the Philippines to that video game programmers purpose- Princeton, Stanford, Harvard, and teach microenterprise to budding capital- fully include such codes to add variety to Wharton, and I was just as competent and ists at a school founded by one of his for- games usually resolves concerns. well equipped to deal with business prob- mer Marriott School professors. “I love “There’s nothing dishonest about it; lems as they were,” Jenkins says. “That’s a helping others catch the excitement of it’s not really cheating,” he says. Raised credit to the curriculum, methods, and fac- what it’s like to own a business,” he says. eyebrows aside, Jenkins loves his job. ulty of the Marriott School. I was sent into Like other Marriott School graduates, “I’m sure every kid has thought at one a gunfight with plenty of ammunition.” Jenkins credits his family and the strength time or another, ‘If I could just figure out a He loved working for Microsoft, but he derives from the gospel to helping him way to make money playing video games,’” found it impossible to balance a family, maintain perspective. Jenkins says. “I haven’t figured out how to job, and two businesses. After four “It’s helpful knowing and having make money playing video games, but I’ve months at the company, Jenkins left to some exterior direction in my life— figured out how to make money and it’s focus on his own enterprises. understanding that I’m not just trying to related to video games. I think that’s about Juggling the management of two prof- make money for the sake of making as close as I’m going to get.” itable businesses was still no small feat, so money,” Jenkins says. “I’m very grateful when the opportunity arose to sell for the influence the gospel has to help me DOT-COM SUCCESS WinFiles.com to competitor CNET for and my family stay on the right path.” m In 1996, while still in graduate school, $11.5 million in cash, Jenkins took it. A year Jenkins “accidentally” founded Jenesys, a later, he also sold VServers.com to Micron Endnotes web media company that created Electronics for nearly $50 million in cash. 1. Jim Hopkins. (2002). “Entrepreneurial spirit suffering; Start-ups fail to help U.S. shed reces- “We were competing with other dot- sion.” USA Today, 18 September, A1. 2. Ibid. coms that didn’t have real customers or rev- enues. Our companies were privately held, About the Author growing, and viable,”Jenkins says.“We were Grant Madsen is a freelance author and media conservative, not like other dot-coms that relations manager for BYU’s University Communications. He earned a BA in communica- were throwing caution to the wind.” tions from BYU in 1998.
winter 2003 17 By Christopher B. Bingham | Artwork by M.C. Escher
“The only constant in our business is ome of the most successful com- panies at managing change may that everything is changing. We have S be a part of your daily life. Chances are, if you own a cell phone, it’s a Nokia. Did you know that the Finnish to take advantage of change and not high-tech giant was once a paper manu- facturer, rubber producer, and cable com- let it take advantage of us.” pany, before becoming a wireless power- house? Likewise, if you rely on Post-It® —Michael Dell, Chairman notes, you are supporting another organi- Dell Computer Corporation zation famous for ongoing change. Known as 3M, this company has managed to reinvent itself using a parade of tech- nologies to create products ranging from sandpaper and reflective guardrails to Thinsulate™. Finally, when using the Internet, do you Yahoo!? This organiza- tion too has morphed through the years from what began as a content aggregator to what is now a broad network of media, also improves ongoing change. Managers bined with another division’s networking communication, and commerce services. can draw from a larger selection base to technology, a new business opportunity While the evolution of companies create the right resource hybrid for the could emerge. Because the first division like Nokia, 3M, and Yahoo! may be dra- right opportunity. possessed the competencies effective in matic, their firm-wide pressures for con- Hewlett-Packard (HP), for example, capturing this emergent opportunity, tinuous change are far from unique. Why? has used modularity to continuously management gave it the new charter to Because many businesses today operate in change and remain competitive through patch together the two technologies. high-velocity environments characterized several decades. In the past, the company Other global organizations are find- by blurred industry boundaries, rapid transferred an ink-jet business from one ing that it makes sense to view geographic shifts in technology, and fast-moving division to another to exploit the second regions with a modular perspective. competition. division’s innovation skills. It has tem- Instead of having an “Asian” strategy or The future is uncertain, making porarily linked its established scanner “European” strategy, many globalizing strategies for change based on the past business with new businesses in Internet firms are breaking down product and ser- largely ineffective. So what is effective strat- applications and wireless appliances. The vice strategies to the country level to meet egy in these dynamic settings? The secret company’s wired and wireless appliances, the specific needs of local people. A part- lies in taking advantage of market confu- infrastructure, and e-services can be con- ner of a leading venture capital firm sion and capturing fleeting market oppor- nected to perform a task and then discon- insightfully noted: “Europe is not a tunities. Modular structures, simple rules, nected when the task is complete and they homogenous market. Companies need to and strategic probes are three tactics man- no longer need each other. Because of its break it down into its forty-two individ- agers can use to make this strategy happen. modular system, HP is able to have its ual markets with individual complexities,
MODULAR STRUCTURES computing architectures configure with Modularity is the degree to which everything from technology resources, resources can be separated and recom- like processor cycles, storage, memory, bined to allow greater flexibility and per- and devices, to application-level business formance levels in end configurations. and consumer services, like messaging, Managers create modularity in their orga- travel, and financial services. nizations by breaking down businesses Besides product offerings, managers into smaller segments. Dell Computer is can also use modularity to successfully one organization that has moved in this reconfigure intangible resources, such as direction. Its commercial relationships are charters. Defined as areas of corporate split into corporate and small business. responsibility, charters can be used in Government agencies chop their accounts modular forms to allow top management into federal, state, and local units. team members to “patch” elements from Nonprofits are segmented into categories one division into others. The patching such as education and medical. process among charters stimulates con- When organizations become more tinuous change by opening new market modular, the process of change speeds up opportunities. For example, in one global as resources become easier to realign, high-tech firm, managers recognized that move, and shift. Increased modularity if one division’s imaging technology com-
winter 2003 19 tax rules, and regulations. European com- larger number of options available for local behavior can generate larger, more panies see the United States in the same implementing strategies. Finally, although complex patterns on the global level. way—one large market—and fail when tightly integrated structures may be more Although it may seem counterintuitive, trying to enter.”In general, breaking down efficient, modular structures become simple rules drive complicated behavior customer segments for globalizing firms more effective in changing conditions. in high-velocity environments. helps rivet managers’ attention on specif- Modularity provides managers working For example, consider the patterns ic market opportunities that the company in high-velocity environments the that emerge from the interactions of can exploit in meaningful ways. increased flexibility needed to successfully computer-generated birds called “boids.” Overall, deconstructing business into adapt to rapidly evolving customer needs As boids fly together in a simulated air smaller modular units conveys several and industry demands. space with frequently approaching obsta- benefits for organizations driven to con- cles, individual behavior is guided by tinuously change. First, when resources SIMPLE RULES three simple rules: (1) maintain a mini- within businesses are modular, any one Applying simple rules is a second tactic mum distance from other boids; (2) element can be removed without affecting used by managers to facilitate continuous match the speed of nearby boids; and (3) the rest of the configuration. This allows change. Many organizational leaders con- move into the center of the mass of boids. managers to isolate and attend to acute tinue to rely on complicated rules to guide Interestingly, no matter where or areas of organizational pain without dis- change efforts. Generally, these rules when an individual boid begins flying, it rupting an entire value chain. Second, evolve from deeply embedded tacit ends up in a flock whose actions are just when resources are broken down into knowledge into elaborate steps for com- like that of a real flock—flying easily smaller, modular units, managers have a pleting specific activities. While these around moving objects. When boids
detailed rules may help managers prepare encounter an obstacle, the flock breaks Simple rules for and adapt to the linear change occur- up and rejoins after passing it. If a boid ring in more stable environments, they hits an obstacle, it recovers and works to provide boundary are ineffective in the unpredictable and quickly catch up to the rest of the flock. nonlinear world of change found in high- The ongoing adaptive behavior of the conditions as to velocity environments. Effective rules in flock of boids results from the simple high-velocity environments are simple. rules governing the individual behavior when, where, and Simple rules keep managers focused of each boid. Interestingly, this behavior on critical issues without over generaliz- happens without any formal flock leader ing from prior knowledge that may prove or even any directive to form a flock. how to change. ineffective for novel changes. Simple rules Beyond use in simulations, simple provide boundary conditions as to when, rules have also found powerful applica- where, and how to change. They also pro- tion in several corporations engaged in vide enough room for creative interpreta- continuous change. Consider Yahoo!’s use tion so that managers can continue to of simple, priority-setting rules to provide innovate and adapt over time. direction to its rapid growth. Yahoo! has With simple rules employees can act three rules governing the formation of locally and autonomously, without cen- partnerships: (1) put the product first; (2) tral coordination. Yet, by following simple do a deal only if it enhances the customer rules, the interaction of each person’s experience; and (3) make no deal that
20 MARRIOTT limits the company’s ability to evolve. By knowledge needed for successful decision providing direction to its employees making in the here and now. Third, sim- regarding partnerships while at the same ple rules create casual ambiguity in the time not prescribing which strategic minds of would-be competitors. alliances should be formed, the compa- Although simple rules appear as ny’s partnering rules have allowed it to transparent, easy-to-imitate action steps, quickly adapt to the Internet industry’s copycats overlook the extensive underly- varied and frequent changes. ing organizational culture, resources, and Intel also uses a number of simple activities that make the use of simple rules rules to guide change. From its inception, possible and profitable. the company has relied on a “maximize- margin-per-wafer-start” rule to help pri- STRATEGIC PROBES oritize the allocation of corporate Finally, the use of strategic probes is a third resources. When the competitive intensi- tactic managers use to effectively change ty in the microchip industry drove mar- over time. Probes help managers prepare gins down, Intel began producing more for the future instead of simply reacting to microprocessors where margins were it. Probes have two key features: (1) Probes higher. While Intel’s priority rule resulted are low-cost options that can be beneficial in foreseen increases in short-term prof- in new markets. (2) Probes can be quickly itability, it also resulted in unforeseen converted and incorporated into an orga-
systemic changes. By shifting production nization’s portfolio of offerings. Examples before the law had even passed. Our reac- slowly away from microchips and into of different probes include technological tion time was very short.” microprocessors, Intel was able to stay or scientific visionaries, product line In a leading wireless chip company, a ahead of its competition and capture an experimentations, geographic markets, similar use of probes emerged. To take emergent market opportunity. and strategic alliances. advantage of emergent wireless opportu- As a whole, the use of simple rules At one technology-based organiza- nities in Japan, the organization hired a conveys several performance advantages tion, managers created a partnership with leading Japanese technologist who was for managers who are continually adjust- a leading accounting firm that helped pre- familiar with Japanese regulations and ing to changing markets. First, simple dict changes to European tax laws. The had his finger on the pulse of changes rules allow room for adaptation. In other laws affected the way the technology com- within his country. When the technologist words, simple rules are designed to pro- pany sold its software in various European heard through his connections that vide just enough coherence and boundary nations, and the ability to properly forecast Japanese radio authorities were thinking conditions that employees can focus amid changes gave the company a competitive about opening a new radio band he began the confusion and disorder that comes advantage in its industry. One manager forcefully lobbying with local regulators, from a constant stream of new informa- involved in the process stated, “The telling them why they should proceed. tion1.Second, simple rules focus on real- European taxes were changed at the begin- More importantly, he relayed the key time information. Rather than rely on ning of last year, and there was a different information about the new Japanese past knowledge that may be outdated and approach in all sixteen European coun- radio band back to the chip designers in obsolete for current situations, managers tries that we had to handle. So we asked the United States before the new band use simple rules to quickly create the new our partner what the changes would mean even opened. Consequently, when the
winter 2003 21 band did open, the company had a chip and explore new areas without the fear of ENDNOTE ready. Effective use of probes—here in the crippling mistakes or financial overcom- 1 Brown, S. L., and K. M. Eisenhardt (1997). form of a leading technologist—helped mitment. “The Art of Continuous Change: Linking Complexity Theory and Time-Paced Evolution the company quickly capture the domi- In short, probes improve organiza- in Relentlessly Shifting Organizations.” nant share of the Japanese wireless chip tional learning about potential futures. Administrative Science Quarterly, 42: 1-34. market, while the other thirty U.S. star- While the future will remain inherently tups working in its space had no idea the unpredictable, probes make it easier for ABOUT THE AUTHOR new band was even opening, let alone had managers to prepare for and adapt to the Christopher B. Bingham is a PhD candidate in a chip ready. changes that will assuredly arrive in high- strategy and organization at Stanford University. Bingham completed a BS in accountancy in Other organizations use geographic velocity environments. 1995, an MBA in 2000, and a master’s in inter- regions themselves as probes. For exam- national studies in 2000, all from BYU. He has ple, one top provider of security products CONCLUSION worked for several small entrepreneurial compa- and software for Internet communications Many organizations engaged in continu- nies as well as for large, established organizations and commerce used Australia as a probe ous change see sustainable competitive including Price Waterhouse, McKinsey & into the Asian market. As one member of advantage as a relic of the past. Rather Company, and Deloitte Consulting. He can be contacted at [email protected]. the senior management team explained, than sustainability, the key term for “Australia isn’t a very large market, but it competitive advantage in high-velocity The author would like to thank Kathy was so easy to do since it is so much like environments is unpredictability. For Eisenhardt for her creative thinking on many of the United States. Australia is a good test companies like Nokia and 3M struggling the topics expressed in this article.
bed because it is near Asia—you can do to constantly remain innovative, advan- more things in Asia from Australia. It’s low tages may last a decade, a month, or only The key term for risk and easy to drive profitability.” a day. So, while many leaders continue to In high-velocity environments, seek sustained advantage, the reality is competitive probes are important because change they are forced to do business as if such occurs rapidly and unpredictably, and the advantage don’t exist. advantage in high- future arrives quickly. This makes it hard Change will always be used to help for managers to accurately predict what firms be different, but in today’s market, velocity environments the new competitive landscape will be and change itself has become different. While when it will arrive. Probes give managers the types and scale of change have in these dynamic settings more options become more uncertain, the speed of is unpredictability. and the advantage of being prepared for change has dramatically increased. As a the future with effective solutions. result, successful corporate strategy in Probes also provide an escape route. high velocity-environments relies on If a prepared solution does not work, modular structures, simple rules, and managers have a repertoire of other possi- strategic probes to create a constantly ble responses at their disposal to quickly changing series of small, temporary, adjust and stay competitive. In addition, competitive advantages. In other words, because probes are low cost, management successful strategy is about managing can use a variety of them to experiment continuous change. m
22 MARRIOTT s chool news
BYU MBA Remains Best Buy says he’ll be loan-free after a year or two. ness, and understanding of international in Business Week That’s a huge relief for Hunter, whose wife, business practices. In spite of a tough Kate, is expecting their first child in just a “Earning the certificate will give students placement environ- few weeks.” a tremendous marketing tool,” says Tad ment and dipping Aside from retaining the best buy title, Brinkerhoff, managing director of the salaries for new gradu- BYU’s MBA program advanced in the publi- school’s Global Management Center. ates, BYU’s MBA pro- cation’s overall rankings from the third to “Although the certificate doesn’t appear on gram held on to the the second tier, edging back into the top an official transcript, it can be used as a best buy title in fifty. Business Week’s 2002 Best B-Schools major selling point with employers for stu- Business Week’s 2002 report is found in the 21 October 2002 issue dents launching international careers.” ranking of top business programs. The of the magazine. “Many students come to the Marriott school had the best return on investment School with a grassroots-level understanding with only 4.1 years to payback, including Marriott School Offers Global of international business,” says Kristie the two years at school. Pennsylvania State Management Certificate Seawright, associate professor of business University came in second at 4.4 years and Marriott School management. “Earning the Global Purdue was third at 4.5 years. administrators Management Certificate allows students to The school’s fast payback is primarily have approved leverage their existing language skills and the result of low tuition and strong salary requirements for experience to bring them to a higher, more gains. BYU graduates on average increased new undergraduate operational plane.” their pre-MBA salaries by nearly 98 percent and graduate cer- Credits for earning the certificate may in 2002—down from the 120 percent tificates in global management. The certifi- also be used toward graduation. More infor- increase graduates posted in 2000 but still cate certifies a student’s business language mation on the certificate can be found at: the highest in the country. The overall aver- capability, experience in international busi- marriottschool.byu.edu/gmc. age starting salary for MBA graduates across the nation dropped this year for the first time since Business Week began tracking CENTER FOR INTERNATIONAL BUSINESS EDUCATION AND RESEARCH data in 1988. BECOMES GLOBAL MANAGEMENT CENTER “Our students graduate with the knowl- edge, skills, and abilities to make a signifi- Brigham Young University’s President’s Council approved cant difference in their professions, commu- renaming the Marriott School’s Center for International nities, and churches,” says James Stice,MBA Business Education and Research (CIBER) as the Global program director. “And, they don’t have to Management Center. The center’s name was changed to repre- pay a lot of money to acquire or enhance sent its expanded role beyond the U.S. Department of those skills. We’re fortunate to attract very Education’s CIBER program and to elevate international business within the school. bright students, which makes giving them a In addition to the name change, new administration and a wider scope of global manage- competitive edge that much easier.” ment offerings were included in the recent center reorganization. C. Brooklyn Derr was Such was the case with recent BYU appointed director of the Global Management Center. Derr previously served as director of the MBA graduate, David Hunter, who was University of Utah’s CIBER. Kristie Seawright was named academic director and Tad featured in the magazine. “Two years ago, Brinkerhoff managing director. The expanded leadership will continue to emphasize CIBER’s David Hunter, a former Towers Perrin Co. mission to internationalize faculty, students, and curriculum at BYU as well as facilitate global health-care consultant, checked out MBA outreach with other universities, colleges, and businesses in the region. programs, looking to make a move to the “The purpose of the new Global Management Center is to expand and further develop the banking business. He considered applying to traditional CIBER model, motivating exceptional growth in international business programs pricier schools like Wharton or Columbia, and opportunities,” Brinkerhoff says. but Brigham Young’s combination of a great From 1990–2002, BYU and the University of Utah have received funding from the U.S. finance faculty and enticingly low tuition Department of Education supporting the development of international curriculum. In October led him to apply only there,” wrote Brian 2002, BYU began receiving funding as an independent CIBER school. Global Management Hindo in a recent issue of Business Week. Center leaders hope to raise additional funds to support the center’s efforts to expand interna- “Smart move: Now Hunter has his dream tional business education. job working with Bear, Stearns & Co.’s pri- “The DOE grant is very significant,” says Brinkerhoff. “It puts us in a good position to vate client services in San Francisco and become a full-fledged global management school.”
winter 2003 23 school news
MARRIOTT SCHOOL GRAD STUDENT Undergraduate Business Career Center spoke candidly about PICKS HIS WAY TO WORLD CUP Among Top Three interview skills and the The Association to Advance Collegiate importance of making a For one Marriott School student, playing Schools of Business (AACSB) has recognized good first impression; the banjo and a passion for soccer seemed the Business Career Center at the Marriott Walker also took ques- worlds apart—until he was invited to play School as one of the most effective under- tions from students and with his bluegrass band at the World Cup graduate placement centers in the United offered advice. this summer in Seoul, Korea. States. The AACSB produced the report as Walker received her bachelor’s degree Jared Peterson,a graduate student in part of its International Effective Practices from BYU and earned her master’s and doc- information systems management, traveled Series that studies student satisfaction at toral degrees from Stanford University and to the World Cup with his four-man band, high-performing schools. the University of Utah respectively. She Long Gone. The band played tunes for a BYU, University of Wisconsin–Madison, spent eight years in Utah’s House of Georgia-based clogging group, the Southern and Indiana University were the three top- Representatives, and during her service as Belles, at pre-match stadium celebrations. performing undergraduate schools. AACSB lieutenant governor she has focused on Hundreds of thousands of exuberant rated 184 campuses on three criteria: student health care and literacy. She has served as spectators took in pre-match entertain- satisfaction, resources and services, and place- chair of both the National Conference of ment provided by performers from the ment statistics. The report found that high Lieutenant Governors and the National countries matched up on the field. Long admission standards and student satisfaction Association of Secretaries of State. Gone and the Southern Belles represented with the business program were the most sig- the United States as part of the 2002 nificant factors in determining career center Rollins Discusses the State of CIOFF International Folklore Festival in success. At the Marriott School, entering E-Business Korea. The groups performed outside the undergraduate management majors scored Kevin Rollins,president and chief operating stadium before the U.S.–Korea and an average of twenty-eight on the ACT and officer of Dell Computer Corporation, U.S.–Portugal games. had an average GPA of nearly 3.7. addressed Marriott School students at “I’ve always been an avid soccer fan, The report emphasized BYU’s “unity of E-Business Day in September. so this opportunity was something I really effort” and strong alumni relationships as wanted,” Peterson said. “The experience characteristics contributing to the Business 2003 school conferences was indescribable.” Career Center’s success. Long Gone band members are Joseph Andersen, an international studies major, Organizational Behavior Degree MOB Annual Conference 27–28 March, $225 who plays bass; Jonathan Gray, a microbiol- Integrates Into MBA Program Open to students and professionals ogy major, who plays guitar; and Andrew The Master of Organizational Behavior involved with organizational change Williams, a technology education major, degree has been integrated into an OBHR and human resources. who plays the fiddle and mandolin. Jared track of the MBA degree. The change was Rowe,who earned a BS in information sys- effective Fall Semester 2002. 6th Annual Microenterprise tems from the Marriott School in 2001, Chaliese Wouden,a student in the Conference traveled with the group to Korea and filled MBA/OBHR track, said she believes the 13–15 March, no cost in on guitar for Gray, who was unable to biggest advantage the integration provides is Open to anyone interested in make the trip. that it grounds organizational behavior microenterprise or economic “We’ve played at the Olympics, within the context of business and large development. fundraisers, private parties, and BYU events,” organizations. 8th Annual Management Conference says Peterson. “But one of the most reward- “When I was looking at programs, I 26–28 June, $300 ing opportunities to-date was playing The wanted to understand the business side of Open to alumni, Management Star-Spangled Banner—bluegrass style— things, as well as the organizational. I wanted Society members, and the public. before U.S. matches at the World Cup.” to be able to speak both languages,” she said.
From left to right: Jared Rowe, Jared Peterson, “I chose BYU because of this combination.” Volunteer Leadership Conference Andrew Williams, Joseph Anderson Students should declare their interest in Late September (tentative), no cost the MOB/OBHR track when applying for Open to Management Society chapter the MBA program. More information can be leaders and Steering Committee found at marriottschool.byu.edu/mob. members.
Lieutenant Governor Speaks to Students For more information on conferences, please visit: Olene Walker, the first female lieutenant gov- marriottschool.byu.edu/conferences.cfm ernor of Utah, addressed MPA students on 12 September 2002 as a guest lecturer. She Conference fees subject to change.
24 MARRIOTT school news
Rollins admitted Students Get Real World Experience ment and the opportunity to put the experi- growth in fundamental Through Investment Class ence on their resume. Everybody benefits.” economies is down and Bryan Sudweeks,an Craig Bench,a former student, said the affecting the technology associate professor of class was extremely applicable to real-world industry. “As far as busi- business management, situations and is grateful for the time and ness goes, we are definite- doesn’t want to simply effort Sudweeks put into the course. “The ly in a recession.” He lecture his students about coursework enables all students to think crit- added, “We seem to have already seen the how to prepare for their ically about investing, something each of us worst of it.” future careers, he wants has to do at one point or another,” he said. Rollins compared the myths and realities them to roll up their sleeves and dive into Sudweeks says he would like to expand of e-business. He explained how the Internet the work. “I’ve always been drawn to pro- the project, but he needs more asset manage- helps transform physical inventory into use- jects with application,” he said. “If you lis- ment companies or small investment bou- ful information, physical assets into intellec- ten, you learn. If you do, you understand.” tiques willing to participate. For information tual assets, the closed model theory into a Sudweeks takes that attitude and applies it on working with the investments 410 class, wide collaborative effort, and vertical inte- to his investments 410 class. For the last three email [email protected]. gration into virtual integration. semesters, the class has been introduced to a portfolio management company in need of faculty news research. The class meets with the company’s awards and recognitions CEO, chief financial officer, and chief technol- Professor Counsels on Criticism ogy officer, and the students spend the rest of BYU Professors Win Top Strategy Giving and accepting the semester analyzing and researching. At the Paper Honors criticism was the topic end of the course, company leaders return to The Strategic Management Michael P.Thompson, hear the students’ reports. Society awarded four BYU chair of the Department “It’s a win-win situation,” Sudweeks says. professors the best paper of Organizational “The company gets free research—all the prize in September at the Leadership and Strategy spreadsheets, documents, and efforts. The organization’s 22nd annual in the Marriott School, students get a real-life project that they have conference in Paris, France. addressed at a BYU devotional assembly 9 to present and defend to company manage- The prize was awarded July 2002. Thompson said correction should be given with love and charity. He warned that MARRIOTT SCHOOL RISES IN WALL STREET JOURNAL RANKINGS a corrupt person will not take chastisement well; pride can insulate people from what The Marriott School moved from 41st to 38th in The they most need to learn. Wall Street Journal’s 2002 ranking of top business schools “I feel a need to say that this theme of worldwide. The school also rose from fifth to third place giving and bearing reproof has been at the in the newspaper’s “hidden gems” category, a listing of very heart of my own labors to become a “schools that produce excellent graduates but aren’t typi- disciple of the master lover and reprover of cally considered top-tier business schools.” the human family,” he said. In addition to the overall rankings, Marriott Thompson said reproof should be given School graduates were ranked ninth for communication and interpersonal skills, the out of inspiration, not ego or impatience, attribute most often mentioned by recruiters as very important. and is received in meekness and submissive- “We are doing some things here that other schools aren’t,” says Curtis LeBaron, assistant ness; he also mentioned that corrections professor of organizational leadership and strategy.“In addition to writing and presentation should be given less often than praise. skills, we emphasize training in interpersonal communication and interpersonal influence.” Thompson emphasized the importance Michael Thompson,chair of organizational leadership and strategy, agrees. “Our stu- of paying attention to all communication. dents arrive with high-level communication skills, particularly in relating to people interper- “Conversations, even casual ones, are not to sonally. Our communication training builds on these strengths. It’s building on an advan- be taken too casually,” he said. tage that the students already have,” he said. Thompson earned his bachelor’s degree The Wall Street Journal worked with market research firm Harris Interactive to survey 2,221 in classical Greek from BYU and his master’s MBA recruiters. Recruiters were asked to rate schools on twelve student, twelve school, and two and doctoral degrees from Rensselaer overall attributes. Recruiters evaluated attributes such as ability to work well within a team; ana- Polytechnic Institute in technical communi- lytical and problem solving skills; leadership potential; and strategic thinking. cation and communication and rhetoric, Although more than 430 accredited business schools were considered, the final sample respectively. Full text of Thompson’s devo- of business schools eligible and available for rating included only 187 U.S. schools and 73 tional is available online at speeches.byu.edu. non-U.S. schools.
winter 2003 25 school news
to Marriott School strategy professors Mark an organization’s decisions on its financial computer industry and has been involved in H. Hansen and Lee T. Perry and BYU statis- performance. For example, the model allows startup efforts of a number of economically tics professors C. Shane Reese and Gilbert W. strategists to predict the financial impact of focused development organizations. Fellingham for their paper, “A Bayesian such decisions as organizational restructur- Michael Swenson has accepted an Application of the Resource-Based View: ing, layoffs, hiring, and acquisitions. appointment as Business Management Narrowing the Gap Between Theory and “The revolutionary part of the research Department chair. Swenson replaced Mike Practice.” is that our method allows us to do analysis at Pinegar, who had been the department chair “We had a lot of confidence that the theory the firm level rather than aggregating data for the past six years. Pinegar will be return- and methods we developed were revolutionary,” across many companies,” says Perry. ing to full-time teaching. says Perry. “But, we were surprised to win.” Swenson received his BS from BYU and Other finalists for best paper came from Rank Advancements, Awards, and his MBA from the University of Utah. He top strategy schools. SMS narrowed best Appointments earned his PhD in marketing from the paper selection from more than six hundred Professor status was given to Steven University of Oregon in 1989. abstracts to ten papers presented at the con- Thorley, in business management. Associate Kate Kirkham has replaced David ference. professor status was granted to Andrew L. Cherrington as OBHR Group Leader. She “One of our early challenges was to identi- Holmes, in business management, and will serve as group leader while also serving fy a statistical model consistent with our theo- William Gerard Sanders, in organizational as both OBHR track leader in the MBA pro- ry,” Hansen says. “That’s where the statisticians leadership and strategy. gram and as MOB program director—ser- became invaluable. We also received tremen- Bill Swinyard,a professor of business vicing the second year MOB students. dous technical support from the Marriott management, received the Karl G. Maeser Kirkham received her BA from the School staff.” Excellence in Teaching Award from BYU University of Utah and her MA from The BYU researchers developed an last August. George Washington University. She earned advanced statistical model—which strengthens Todd M. Manwaring has been named her PhD in organizational behavior from the popular resource-based view of the firm— director of the new program for economic the Union Institute. that can be used to predict the consequences of self-reliance. He previously worked in the Rollins Center Gains New International Committee Faculty Lead BYU PROFESSOR ADDRESSES INTERNET TAXATION The Rollins Center for ISSUES AS STATE BUDGETS DROP eBusiness has a new As the subject of taxation on Internet commerce becomes increas- international committee ingly controversial, one BYU tax expert is being called on to search faculty lead. Kaye for solutions to the issue cited as one of the major causes for state Hansen, an assistant budget losses across the United States. professor of organiza- “The result of lower sales tax collection is up to 15 percent losses tional leadership and in tax revenues in some states,” says Gary C. Cornia, a professor of strategy, brings her extensive international public management and former commissioner of the Utah State Tax expertise to students and the center. Commission. “It is a matter of great concern.” Hansen served a mission in Germany, According to a recent study commissioned by the Institute for State Studies, a traveled internationally with her consulting, nonprofit group based in Salt Lake City, state revenues faced a loss of over $10 billion and has served as associate director of the in uncollected sales taxes on online transactions in 2001. The study indicated that num- BYU Jerusalem Center. She has also served ber could balloon to more than $45 billion by 2006. as associate director of the Marriott School The Reilly Center for Media and Public Affairs at Louisiana State University MBA program. Hansen received her bache- recently invited experts from around the nation to address a number of public policy lor’s, master’s, and doctoral degrees from issues facing Louisiana and other states. Cornia, current president of the National Tax BYU in theatre and German. Association, received a fellowship from the Reilly Center to discuss state and local tax Monte Swain, associate professor of policy in the national electronic commerce environment. management accounting, was the former Cornia presented lectures dealing with taxation issues to Louisiana state legisla- international committee faculty lead. Under tors and to LSU students and faculty. Jim Richardson, director of the Public Swain’s leadership, the international com- Administration Institute at LSU, said Cornia made them “more aware of the prob- mittee worked closely with MSTAR.net and lems and options with respect to resolving the ability of state and local governments the e-business grams project. Swain is asso- to tax electronic commerce.” ciate department chair for the School of “All 45 states with sales tax have ‘use tax’ laws in place, which allow for the collec- Accountancy and Information Systems. tion of tax on purchases where sales tax is not collected, such as with Internet purchas- The international committee will con- es,” says Cornia. “The problem is with the enforcement of these laws. I believe states will tinue to help faculty members publish arti- continue to experience increasingly large revenue losses until this issue is resolved.” cles in international magazines.
26 MARRIOTT school news
new faculty bios
BUSINESS MANAGEMENT Corporation consulting in all from BYU. He was one of the sectors of the health care first instructors certified by Chad Allred—Allred earned industry. His research Microsoft to teach Windows his PhD from Purdue interests include corporate NT 3.1 in 1993. Lindstrom’s University after earning an strategy, diversification, and areas of expertise include sys- MBA and a BS in electrical the scope of the enterprise; tems design, database man- engineering from BYU. strategic management/busi- agement, networking, and Allred’s research interests ness policy; and corporate entrepreneurship. software development. He is an assistant pro- fessor of information systems. include high-tech business-to-business He is an assistant professor of strategy. alliances and high-tech manufacturer/channel Timothy M. Gardner— John E. Richards—Richards relationships. He is an assistant professor of Gardner earned his PhD earned his BA at BYU in business management. from Cornell University, his chemistry and has had a long master’s degree in labor and career as an entrepreneur Glenn L. Christensen— human resources from Ohio that includes founding more Christensen earned his PhD State University, and his BS than five companies. He has in business administration from Bowling Green State experience in investing and from Pennsylvania State University. His research interests include consulting, and he is a frequent speaker at University and his MBA with interfirm competitive dynamics in the conferences and conventions. Richards is a emphasis in marketing management and BA recruiting and retention of human resources professional track faculty and will also serve in public relations from BYU. Christensen’s and interfirm cooperation strategies for the as associate director of the Center for teaching interests include marketing strategy, management of human resources. He is an Entrepreneurship. consumer behavior, marketing management, assistant professor of organizational leader- promotion management, services marketing, ship and strategy. MILITARY SCIENCE and e-commerce. He is an assistant professor Master Sergeant Daniel B. of business management. ACCOUNTING Bullock—Bullock’s training Peter M. Johnson—Johnson, includes courses in primary Eric DeRosia—DeRosia is a CPA, is completing his PhD leadership development, completing his PhD in mar- in accounting from Arizona basic noncommissioned offi- keting from the University of State University after earning cer and advanced noncom- Michigan after earning his BS his MAcc and BA from missioned officer, and first from BYU. His research Southern Utah University. sergeant. He has also completed ranger, air- interests include the relation- His teaching experience borne, air assault, pathfinder, jumpmaster, ship of brand personality includes four years at BYU—Hawaii, where he and drill sergeant schools. He is an assistant beliefs to product categories, contextual influ- was awarded both School of Business professor of military science. ences on consumers’ formation of beliefs and Professor of the Year and BYU—Hawaii attitudes, and methodological issues relating Teacher of the Year. Johnson is a member of Sergeant First Class Sean M. to Internet-based experimentation. He is an the American Accounting Association, the Polwort—Polwort’s training assistant professor of business management. American Institute of Certified Public includes primary leadership, Accountants, and the Hawaii Society of basic noncommissioned Olivier Maisondieu- Certified Public Accountants. He is an assis- officer, and advanced non- LaForge—Maisondieu- tant professor of accounting. commissioned officer cours- LaForge is completing his es, as well as ranger, jump- PhD in finance from the INFORMATION SYSTEMS master, pathfinder, drill sergeant, and air- University of Cincinnati after Paul B. Lowry—Lowry borne schools. He is an assistant professor of earning his MBA from BYU earned his PhD from the military science. and his BS from the University of Nevada at University of Arizona and his Las Vegas. His teaching interests include corpo- MBA and BS in information Captain Richard Warr— rate finance, international finance, and invest- systems from BYU. His areas Captain Warr earned his BS ments. He is a visiting professor of business of expertise include systems in mathematics from management. analysis and design; virtual Southern Utah University teams; conceptual modeling and software engi- and his commission through ORGANIZATIONAL LEADERSHIP neering; and behavioral issues in decision sup- Officer Training School. AND STRATEGY port systems. He is an assistant professor of After earning his commis- David J. Bryce—Bryce earned his PhD in information systems. sion, he served as a database team leader at strategic management from the University of Offutt Air Force Base, Nebraska and as a Pennsylvania and his MBA, MAcc, and BS in Craig Lindstrom—Lindstrom earned his MS deputy commander and executive officer at information systems from BYU. Bryce has in information systems from Utah State Holloman Air Force Base, New Mexico. He is worked with APM Management Consultants, University and his BS in business management an assistant professor of aerospace studies. Ernst & Young, and Computer Sciences
winter 2003 27 alumni news
SLOC Chief Named Honored Alum Homecoming Week. Amid growing concerns about your own individual strategic plan.” On 17 October 2002, about corporate corruption, Bullock spoke Bullock earned his BS in 1978 and MBA Fraser Bullock was about having a good reputation. “When you in 1980 from BYU. He and his wife, Jennifer, named the Marriott think of your legacy, it’s not about the reside in Alpine, Utah, and are the parents of School’s Honored Alum. money. It’s about how you treat people; it’s five children. Bullock worked as chief about your integrity shining above every- operating officer and thing else,” he said. Alumni Unite in Forming Unitus chief financial officer of He suggested seven principles that were What began as a group the Olympic and Paralympic Winter Games key to the success of the Olympics that are of philanthropists desir- in Salt Lake City. He assumed the role of also applicable to anyone in a business envi- ing to make a difference SLOC CEO following Mitt Romney’s resig- ronment: demonstrate high ethical stan- has grown into a leading nation last spring. He also is managing direc- dards, be fiscally responsible, build a great microenterprise lender, tor and founder of Alpine Consolidated, a team, be loyal to the organization and other Unitus. This high-impact company specializing in business consolida- team members, have fun and a good sense of microenterprise accelera- tion transactions. He led the formation of humor, focus on excellence, and deliver on tor dramatically expands the lending capaci- ResortQuest International and Travel what is promised. ty of carefully selected microfinance institu- Services International, and he has worked for Bullock advised, “You need to think tions (MFIs) in developing countries. Bain and Company, Bain Capital, U.S. Order, about what it is that you bring to an organi- Unitus’ mission is to catalyze the growth World Airways, and Visa International. zation; you need to think about your of small and midsized MFIs, allowing mil- Featured honored alumni spoke to stu- breadth of experience; you need to think lions of poor people to improve their stan- dents of their respective colleges during about your education; you need to think dard of living by gaining access to microfi- nance products and services. Marriott School graduates Tim Stay and GRADUATE HONORED BY WORTH MAGAZINE Louis Pope are two of the founders who are Handling clients whose net worth averages $50 million each day is part successfully helping the poor start businesses. of Robert Haynie’s job as a principal and Pacific Northwest area leader Unitus selects and partners with MFIs that of Ernst & Young’s advisory practice. Excelling at his job earned him a have demonstrated a clear capacity to spot as one of Worth’s 250 top financial advisors in the magazine’s design, implement, and grow a successful July/August 2002 issue. microfinance program. Unitus provides Haynie not only made the top 250 list, but was also one of six advisors funding and consulting services to these ranked among the “brightest and most trustworthy financial advisers,” MFIs, with the aim of dramatically accelerat- according to Worth’s editor-in-chief Randy Jones. Haynie is also an advisory board member of ing the number of microcredit loans that Ernst & Young Investment Advisers. He is a certified financial planner, certified investment can be made to the entrepreneurial poor in management analyst, CPA, and personal financial specialist. “I owe this honor to my great developing countries. clients and to being part of the Ernst & Young team,” Haynie said. “We know microcredit works; it’s just Competition for recognition among the nation’s top financial advisors can be fierce. not reaching its potential,” said Geoff Davis, Background checks, letters of recommendation, sample financial plans, professional designa- president of Unitus. Marriott School profes- tions, client-retention rates, and average portfolio returns are some of the criteria the magazine sor of organizational behavior Warner staff uses to generate the list. Woodworth is a consultant to NGOs such as Worth’s senior writer Melissa Phipps said the list contains the “people you can count on Unitus. “In the future I see Unitus as moving during good times and bad.” She continued, “What distinguishes the winners is their broad from small-scale experiments in a few coun- range of knowledge—from investment advice to tax and estate planning—that allows them to tries to a successful long-term, large-scale be financial quarterbacks for their clients.” methodology for addressing poverty, espe- Haynie is president of the Puget Sound (Seattle) chapter of the BYU Management Society, cially in the Third World,” he says. board member of the University of Washington Gift and Estate Planning Council, member of Interest in microenterprise firms like Unitus the Investment Management Consultants Association, and a member of the American Institute continues to grow at BYU. The Marriott of Certified Public Accountants and its Personal Financial Planning Division. School and Romney Institute of Public For the last six years, Haynie has lectured at BYU Education Week, addressing mass- Management will cosponsor the Sixth market issues. He earned his MAcc from BYU in 1978. He and his wife, Ruth, have four Annual Conference on Microenterprise daughters, and they reside in Shoreline, Washington. Development 13–15 March 2003. More con-
28 MARRIOTT alumni news
ference information can be found at ALUMNUS RECEIVES HIGHEST MARKS ON OREGON CPA EXAM microenterprise.byu.edu or by emailing [email protected]. Sometimes serious cramming sessions do pay off. Upon graduating with his MAcc, R. Marcus Young took a consulting job in Portland, Alumni Board Reorganized Oregon. When CPA exam season came, he wasn’t even sure he was At its semiannual meetings on 8-9 October, going to take it until his brother-in-law convinced him to. the Marriott School Alumni Board was Young took some time off from work and began a rigorous study ses- restructured. Board resources were realigned sion three weeks before the test. His wife, Stephanie, and daughter, to better serve the school and its volunteers Victoria, went to Utah to stay with family so he could study from dawn by tying alumni support more closely to the until dusk without interruption. “The weird thing is that you never really know how well work being done by faculty and students. you’ve done. When I finished I had no idea if I had passed all the sections or not,” he said. Restructuring dissolved the current “I was just putting down material to fill up the page and hoping for the best.” alumni board, created three new program- His wishful thinking became a reality three months later when he received his specific boards, and added members to three score—ninety and above on all three sections. Among all the jumping and celebrating, a existing advisory boards. Each Alumni Board thought crossed his mind: “I wonder if I was in the top ten or anything.” member joined an advisory group based on A couple of weeks later he received a simple letter telling him he got the top score in his or her personal area of expertise. Oregon; he also received a minor case of laryngitis. “I was alone when I read it,” he The advisory groups include: the recalled. “I actually yelled so loud that I lost my voice for a couple of days.” Undergraduate Business Management Young credits his BYU experience as practical preparation for the exam. “The profes- Program Advisory Board, Marketing sors in the accountancy program didn’t just stick to math or technical problems; they Program Advisory Board, Corporate taught us how to approach a problem by using logic and common sense,” he said. Finance Program Advisory Board, Global Young graduated in 2001 and works as a consultant at Experio, which is the consult- Management Center Advisory Board, and ing services unit of Hitachi. “I am happy with my choice to go into business consulting, the Institute of Financial Service Advisory even though none of my friends in school chose this route,” he says. “I understand more Board. and more what makes an enterprise tick.” Robert Gardner,alumni relations man- ager, said, “This organizational change has been in the works for more than a year now. 1970 the Boys and Girls Club as well as Give Every Child a Chance and Doctors Hospital of It has been wonderful to see alumni board Karl Tueller has served as Manteca. Adams was a key part in establishing leaders and Marriott School deans continu- deputy director to the Idaho the Manteca Lathrop Community Council, a ally improve the quality and effectiveness of Department of Commerce local board that assists with United Way Funds. the school’s alumni involvement.” since 1985. He is responsible He is also a member of the Manteca Rotary Club. for coordinating the depart- Adams earned his BA in criminology from ment’s five divisions: adminis- Berkeley in 1972 and his MPA from BYU in class notes tration, economic development, international 1975. He resides in Manteca with his wife, Trixie. business development, rural and community They have three sons. development, and tourism development. 1969 Tueller serves on the board of directors for 1976 the Idaho Council of State Community The San Fernando Valley Development Agencies and served as president Larry C. Worrell,a CPA, has been named senior Business Journal recently from 1998 to 1999. He also serves on the board vice president and chief financial officer of Big-D named Gary E. Condie of of directors for the Idaho Rural Partnership, Construction, one of the largest design/build Condie & Wood, CPA’s, P.C., as which he chaired in 1999. He represented Idaho contractors in the Intermountain West. Worrell one of the top twenty-five on the U.S. Science and Technology Council of was most recently a partner in the Salt Lake City CPAs in the greater San the States from 1993 to 1997. office of Grant Thornton Accountants & Fernando Valley region. Tueller earned his BS in business administra- Management Consultants. Worrell earned his BS Condie is a former president of the Los tion from BYU in 1968 and his MPA in 1970. He in accountancy from BYU in 1976 and an MBA Angeles Chapter of the California Society of CPAs and his wife, Mary Ann, have four children and from Golden Gate University in San Francisco in and is a past member of the organization’s state reside in Boise, Idaho. 1985. He and his wife, Kathy, reside in board of directors. He serves as vice president of Centerville, Utah. the Santa Clarita Valley Boys and Girls Club, chair 1975 of the Henry Mayo Newhall Memorial Hospital 1981 Foundation board, member of the William S. As Manteca, California, city manager, Bob Adams Hart School District advisory board, and as vice acts as liaison between the city council and city Duane Francis was selected as president of the Santa Clarita Valley Facilities employees. Adams started his career as an admin- president of Mid-Columbia Foundation. He is former executive vice president istrative assistant in the city of Visalia, California, Medical Center in The Dalles, of Aquafine Corporation as well as president and where he worked for two and a half years. He Oregon, last August. Mid- CEO of A.M.E. Label Corporation. He earned his later became manager of Dinuba, California. Columbia Medical Center BS in accounting from BYU in 1969. Adams serves on the board of directors for offers a continuum of services,
winter 2003 29 alumni news
ENTREPRENEURS TACKLE ONLINE TRADING companies, Ballard Communications. In 1999, Ballard was honored as Las Vegas Principal of the For Jeremy Hanks,being an entrepreneur comes natu- Year by the largest communications organization rally. Even though he’s the founder of a successful dot- in the state. In 1995 and 2001, Ballard was com company, that doesn’t keep him from thinking named one of the “Top 40 Under 40” business about other possible business ventures. “Right now I and community leaders by the Las Vegas Business have ten different ideas of companies I’d like to start Press and In Business Las Vegas. Ballard serves as a strategic advisor to that I think would do well,” he says. North American Deed Company, a national real Nate Jensen and Jeremy Hanks Hanks, who earned his BS in business management estate technology company. He is a former in December 2002, started Geartrade, an online swap for outdoor gear, in 2000. As the web site president of the BYU Management Society was growing, he realized his company’s strength was the online trading technology, so the chapter in Las Vegas and serves on the Marriott company’s focus shifted and eventually merged with another company, creating e3vertical. School Alumni Board, the Utah Shakespearean “I grew up on a farm, and I was always trying to find an easier, more innovative, and Festival Board, and the Literacy and Education Awareness Project. He earned his BS in busi- better way. That encouraged me to want to work for myself,” Hanks says. “I would get frus- ness marketing in 1985 from BYU. Ballard and trated with people who didn’t do things the way I thought was better; I always thought there his wife, Robin, have four children; they reside was a more efficient way.” in Henderson, Nevada. Though Hanks learned about work ethic on a farm, it was his time at the Marriott School that led him to the resources he needed to start the company. “For people in business A Lindon-based company, it’s important to network. Using school resources—peers, faculty, centers, and institutions— Altiris, was named the “fastest growing and most promising students can learn how to do some great things,” Hanks says. new company in Utah” by the Hanks’ time at BYU led him to people who are now his business partners: Ryan Nichols Utah Valley Entrepreneurial and Dave Gray. Nate Jensen, e3vertical’s vice president of development, was a hometown Forum last summer. It has friend from Burley, Idaho. Jensen, a business management graduate,says he enjoys being in become a leader with the help of its president control of a company. “Instead of working for another company that other people were caus- and CEO, Greg Butterfield. ing to fail, I wanted to be in a position where if it failed it was my fault.” Butterfield graduated from BYU in 1985 with a BS in finance and has experience in sales Jensen sees e3vertical’s survival among the dot-com bust as a testament of what the and marketing, especially in the computer soft- company is doing. “We weathered that storm and we’re continuing to make progress,” he ware industry. says. “We’re not dot-com millionaires, but we’re surviving. Many people can’t say that.” 1986
Bruce A. Brown joined Wasatch Environmental, Inc., as senior project manager. He works in the including education and prevention programs, markets. He and his wife, Ella, have six children. environmental sciences and engineering group outpatient and in-home services, and state-of- performing underground storage tank removals the-art inpatient programs. 1983 and installations. Since earning his accountancy degree in Brown earned his BS in chemistry from the 1981, Francis has worked exclusively in health- Markell Fluckiger was recently appointed trea- University of Nebraska in 1971 and his MBA care, serving in a variety of financial and leader- surer and tax counsel of Timex Corporation, from BYU in 1986. He and his wife, Laura, reside ship roles. He has worked at the Utah Valley headquartered in Middlebury, Connecticut, in Salt Lake City. Regional Medical Center in Provo and for the where he has been working as head of the tax department since 1994. Previous to joining Mercy Medical Center in Roseburg, Oregon. 1993 Francis and his wife, Tami, have three children Timex, Fluckiger worked as tax counsel for General Electric in Albany, New York, and as an and reside in The Dalles, Oregon. U.S. Air Force Captain Michael B. Howard associate at the law firm of Gibson, Dunn & earned a master’s degree in regional security 1982 Crutcher in Newport Beach, California. studies from the Naval Postgraduate School in Fluckiger earned a BS in accountancy and a Monterey, California. His course of study covered Brent Wayne Romney may live MAcc from BYU in 1983, and a JD from the the history, politics, economics, and military in Dallas, Texas, but he has kept University of California, Berkeley in 1987. He strategy of the Middle East, Europe, contempo- himself connected to BYU in and his wife, Ellen, have six children; they reside rary Russia, and Central Asia. multiple ways. He was recently in Southbury, Connecticut. The degree required Howard to demonstrate named president of the fluent Turkish language proficiency. His studies National BYU Alumni Board. 1985 are in preparation for his next assignment at He also has served as president of the Dallas/Ft. Izmir, Turkey, where he will command Worth chapter of the BYU Management Society D. Michael Ballard,chiefmar- Detachment 523 of the Air Force Office of and as chair of the Dallas/Ft. Worth chapter of keting officer of Systems Special Investigations. The AFOSI’s primary the BYU Alumni Association. Research & Development in responsibilities are to conduct criminal investiga- Romney earned his BS and MAcc in accoun- Las Vegas, has been named to tions and counterintelligence activities. Howard tancy from BYU in 1982, with an emphasis in the board of directors for Black earned his BS degree in international finance audit. He is corporate director of internal audit Mountain Community Bank. from the Marriott School in 1993. at UICI, a company that offers insurance through Before joining SRD, Ballard was the founder its subsidiaries and provides selected financial and CEO of one of Nevada’s fastest growing services to niche consumer and institutional
30 MARRIOTT alumni news
1994 2002 management society news Abraham David Benavides accepted a position At the end of last summer, Lisa as an assistant professor at the University of Boland moved to Fresno, North Texas. Benavides earned his BA from California, to start work as a Elder Robbins Addresses Alumni George Washington University in 1987, his MPA marketing research coordinator On 20 September 2002, from the Marriott School in 1994, and his PhD at MBIA Muniservices Elder Lynn G. Robbins from Cleveland State University in 2002. He and Company (MMC). MMC is a addressed members of the his wife, Sandra, reside in Denton, Texas, with subsidiary of MBIA that consults exclusively with Orange County their four daughters. local governments on identifying and extracting missing revenue from the jurisdiction’s existing Management Society and 1995 tax structures. Boland is responsible for market- the J. Reuben Clark Law Society. Elder ing research relating to new products, services, Robbins is a member of the First Quorum of Jay Anthony Riggs founded and markets. the Seventy, is the Church’s North America Riggs Capital Management, Boland earned her BS degree in human West Area President, and chair of the LLC (RCM) in Salt Lake City, development from BYU in 2000 and received her Newport Beach Temple Committee. Elder a registered investment advi- MPA in 2002. sory firm. Before opening Robbins is former senior vice president and RCM, Riggs served as chief After graduating with her MPA cofounder of Franklin Quest. information officer and chair of the investment in 2002, Christie Elder Robbins spoke about service. Bill committee at CLS Investments, Inc. in Omaha, Hollingshead spent the sum- Chapman,president of the Orange County Nebraska. Before that he worked for Fidelity mer as a computer software Management Society chapter, said Elder Investments as a brokerages securities trader. trainer at health care company Robbins advised alumni to “view problems Riggs graduated from the Marriott School in Regence BlueCross BlueShield 1995 with a BS in business management and an of Utah. Subsequently, she switched jobs within as opportunities to strengthen relationships emphasis in finance. He earned an MBA with an the organization and now works as a professional- by helping people overcome their problems.” emphasis in finance in 1998 from the University and provider-relations consultant. The Orange County Management of Utah. He and his wife, Marlene, have four “Ultimately, I chose this position because I Society and Law Society alternate sponsoring children, and they reside in Sandy, Utah. liked the company and the opportunity to work luncheons and events. Chapman said their with professionals in a challenging industry,” 2000 goal for next year is to have monthly meet- she said. Hollingshead, who earned her BA from BYU ings with the two societies. Stephanie Smart works for in humanities, said she was drawn to the MPA Won-Door Corp., a manufac- program because she wanted to strengthen her turer of folding fire doors and Leadership Conference management skills and knowledge. “The pro- folding partitions in Salt Lake On 5-7 September 2002, Management gram provided those practical skills while City. She produces computer- Society leaders participated in a conference preparing me for opportunities in both the pub- generated instructions used to for training volunteer leaders of BYU alumni lic and the private sectors,” she said. fabricate custom doors and maintains the com- pany’s web site. Smart used her skills to maintain the Oregon Professor and Alumni Collaborate on Book Eugene Mission web site while her parents presided there. She also volunteers at the Hale Centre Theatre in West Valley City, Utah. Smart Juggling should be left to professional jugglers, who can sustain earned her BS in business management with an objects in air for periods of time. Those who aren’t professional jug- emphasis in information systems in 2000. glers should work on balancing their lives, instead of juggling them. 2001 That’s the philosophy behind Beyond Juggling: Rebalancing Your Busy Life,written by Kurt Sandholtz, Brooklyn Derr, Kathy Buckner, and Recent MBA graduates Scott Higbee and Dawn Carlson. Brandon Nielson served on a private equity “When we started out we had a goal: to make a difference and do conference panel at the United Nations in New some good,” said Derr, Marriott School professor of organizational behavior. York City.The conference was part of a private equity series hosted by IIR Conference. The Through 150 interviews with professionals, theories began evolving from their obser- panel presentation was titled “Private Equity vations. Buckner says the juggling metaphor came up frequently during the interviews. Fund Raising 2002: Find Capital, Implement an “People juggle when they have more things in the air than they have hands; they just Effective Marketing Strategy, and Profit From ignore one for awhile, catch it before it hits the ground, and throw it back up in the air. Strategic Fund Raising Techniques.” It’s very difficult to keep it up for long,” she says. Higbee and Nielson are both associates at Sandholtz said juggling didn’t work well for the people they interviewed. “There was Partners Group, located in midtown Manhattan. Higbee lives in Manhattan with his wife and two no joy in work or in personal lives because so much was going on,” he said. sons, and Nielson lives in Westfield, New Jersey, Instead of juggling, the authors suggest people try different strategies to balance their with his wife and two sons. lives: alternating, outsourcing, bundling, techflexing, and simplifying. The book offers assessments and explanations of these different balancing strategies. “Almost anybody can have more balance,” Buckner said. “It will take discipline, but the payoff is worthwhile.”
winter 2003 31 alumni news
groups at BYU’s Aspen Grove. In addition to the Marriott School’s ALUMNI’S BOOK LANDS ON BEST-SELLER LIST Management Society, representatives from the Clark Law Society, Cougar Club, and the Typically, a publisher screaming at an author over the BYU Alumni Association attended. phone would be considered an unpleasant experience, Participants listened to an address from but in Kerry Patterson’s case, it was just the opposite. President Merrill J. Bateman,received lead- The publisher was excited because Patterson’s ership training, worked on chapter develop- book, Crucial Conversations,coauthored with Joseph ment, and coordinated activities with other Grenny, Ron McMillan, and Al Switzler, had made its alumni groups. debut on the New York Times’ best-seller list. The “There’s a tremendous synergy when book, whose authors are all alumni of BYU, came out in June. Within weeks, it was the leaders get together, because they share suc- fifth best-selling business paperback book, according to the New York Times. cess stories and give each other advice,” says Patterson says the book is a result of consulting with organizations for twenty years. Rixa Oman,Management Society executive “We stumbled upon it—the idea of crucial conversations—accidentally,” he says. “We director. “They get a sense of being part of a were teaching dialogue skills before we came up with the language of crucial conversa- worldwide organization. We all come away tions. It became important because we realized it was probably the single most important excited to be part of it.” predictor of success in organizations.” Knowing how to tactfully say something is a talent, Patterson says, a skill that could Dean Perry Visits France Chapter resolve a great deal of conflicts. “Every time we bomb somebody it is because we can’t fig- The Paris chapter was fortunate to receive a ure out how to work it through. We spend money developing people who can design visit from Marriott School Associate Dean bombs, but we should be spending money developing people who can talk,” Patterson says. Lee Perry,who traveled to France in September to attend the 22nd annual Strategic Management Society Conference. Chapter members, headed by President Gerald Causse,were excited to hear from ALUMNA COMPETES FOR MISS AMERICA TITLE Dean Perry and to receive the latest Marriott School updates. Take one accounting alumna, add about fifty more women, one trip Dean Perry taught members about right- to Atlantic City, New Jersey, and what do you get? The Miss America eous leadership; he recommended that peo- Pageant. ple lead with humility and purity to over- This year’s Utah representative was Natalie Camille Johnson, come their struggles with pride. “It’s pretty who earned her BS in accountancy in 2002. She has the numbers clear that the powers of heaven and the to prove it too. Johnson has competed in seventeen pageants, rights of the priesthood are integrally con- earned more than $20,000 in pageant scholarships, spent thirteen nected,” he said. “They’re very tightly con- years in formal piano education, and in the last three years devoted more than six nected, but they’re both based upon the thousand hours to volunteering. principles of righteousness.” Johnson, who is from Bountiful, Utah, was Miss Northern Utah until last summer when she was crowned Miss Utah, one week after she graduated from the Marriott Members Kick Off Boston Chapter School. “Being crowned Miss Utah 2002 was the culmination of years of hard work, On 15 November, The New England practice, dedication, and a little bit of luck,” she says. Professional Society, an affiliate of the Johnson, who competed in her first pageant when she was seventeen, has competed Management Society, hosted a dinner to in the Miss Utah pageant for the last three years. At first she was competing to overcome celebrate the new beginning of the Boston shyness and to earn money for college, but a few years ago it became more personal for Management Society chapter. Clayton M. her. “After my older brother Eric died in May 1999, my reason for competing became Christensen,professor at the Harvard service. Eric died of a cancerous germ-cell tumor and malignant melanoma—the dead- Business School, and Joseph Ogden, assis- liest form of skin cancer,” she said. “Pageants gave me a forum where I could teach peo- tant dean of the Marriott School, spoke to ple about skin cancer prevention, detection, and treatment.” attendees. Johnson competed in the Miss America Pageant on 21 September 2002; her talent Ron Mika, president of the chapter, said, was playing the piano, and her platform was skin cancer prevention education. Now her “A great deal of effort has been expended by days are filled with speaking engagements and appearances. With the money she earned numerous individuals to restart the Boston from pageant scholarships, Johnson plans on getting a master’s degree in health adminis- chapter. We are excited about following in tration. “Since losing my brother, I have been interested in being in the medical field as a the proud tradition of nearby chapters and hospital administrator to use my accounting skills in a medical environment,” she says. will focus our programs to serve fellow LDS professionals in the Boston area.”
32 MARRIOTT m anagement society
MANAGEMENT SOCIETY MICHIGAN, DETROIT TEXAS, HOUSTON national CHAPTER PRESIDENTS Rob Schoenhals Paul L. Comstock steering committee (248) 576-8047 (713) 977-2694 [email protected] [email protected] EXECUTIVE DIRECTOR ARIZONA, MESA/PHOENIX Rixa Oman Mike Holt MINNESOTA, MINNEAPOLIS UTAH, CAMPUS CHAPTER (801) 422-6824 (602) 250-8121 Jere Clune (801) 422-5791 [email protected] [email protected] (763) 391-0417 (W) BYU Graduate Chapter [email protected] Steve Arner ASSISTANT DEAN, EXTERNAL CALIFORNIA, EAST BAY BYU Undergraduate Chapter Dennis Dalling RELATIONS MISSOURI, SPRINGFIELD Marc Uda Joseph Ogden (925) 487-0563 David Warren [email protected] (801) 422-7696 (417) 831-4100 (W) UTAH, SALT LAKE CITY [email protected] [email protected] Chris Feinauer CALIFORNIA, LOS ANGELES (801) 534-6003 (W) Dennis Fors GREAT LAKES REGION NEVADA, LAS VEGAS [email protected] Sharon Worlton, National Chair (231) 345-8059 (W) Larry Moulton [email protected] (630) 369-0785 (702) 222-9800 UTAH, ST. GEORGE [email protected] lmoulton@bankofcommerce- Kim D. Anderson CALIFORNIA, ORANGE COUNTY nevada.com (435) 674-1600 UTAH/IDAHO REGION William Chapman [email protected] (714) 550-7720 (W) NEVADA, RENO John Toronto, National Chair-Elect [email protected] R. Craig Eyre UTAH, UTAH VALLEY (801) 246-1466 (W) (775) 829-1999 (W) Boyd Hales [email protected] CALIFORNIA, SACRAMENTO [email protected] (801) 489-8184 Whitney F. Washburn [email protected] ATLANTIC REGION (916) 638-8800 (W) NEW HAMPSHIRE, NEW ENGLAND Robert E. Parsons, Jr. [email protected] Denny Treu VIRGINIA, BLUE RIDGE (240) 744-5400 (W) (978) 687-4701 Bradley Turnmire [email protected] CALIFORNIA, SAN DIEGO [email protected] (540) 989-0920 Mike Hood [email protected] NORTHEAST REGION (760) 752-7848 (W) NEW MEXICO, ALBUQUERQUE Lance Spencer [email protected] Keith Mortensen WASHINGTON, D.C. (603) 791-5286 (505) 896-8996 ext. 4 (W) Mark A. Dickson [email protected] CALIFORNIA, SAN FRANCISCO [email protected] (202) 223-1685 (W) Richard Hutchins [email protected] NORTHERN CALIFORNIA/NEVADA (415) 356-8008 (W) NEW YORK, NEW YORK REGION [email protected] Kimberly Stewart WASHINGTON, PUGET SOUND Rich Barney (917) 493-9482 Robert Haynie (925) 943-6005 CALIFORNIA, SOUTH BAY [email protected] (206) 654-7590 [email protected] Jack Little [email protected] (408) 351-4231 (W) N. CAROLINA, RALEIGH [email protected] NORTHWEST REGION Mark Bethens WASHINGTON, SPOKANE Ken Roberts (919) 522-0441 Larry Longhurst COLORADO, DENVER (253) 851-0481 [email protected] (509) 893-1415 (W) [email protected] Ron Pierce [email protected] (303) 299-8198 N. CAROLINA, PIEDMONT [email protected] international chapters SOUTH CENTRAL REGION Jeff Kulesus Brian C. Dixon (336) 882-2424 FLORIDA, ORLANDO (225) 296-8384 (W) [email protected] ARGENTINA, BUENOS AIRES [email protected] David R. Portlock Claudio Salerno (407) 352-7006 (W) OHIO, COLUMBUS 54-3327-458-343 (W) SOUTHEAST REGION [email protected] Larry Thomas [email protected] John Sabin (614) 781-0472 GEORGIA, ATLANTA [email protected] BRAZIL, SAO PAULO (410) 712-4411 Greg Bluth Peter Furukawa [email protected] (678) 523-3232 OREGON, PORTLAND 11-3046-2529 [email protected] Rick Garlock [email protected] SOUTHERN CALIFORNIA/HAWAII (503) 296-5232 REGION HAWAII, HONOLULU [email protected] CANADA, CALGARY Wayne Sant John P. Monahan Robert E. Price (909) 549-8650 (808) 395-4079 (H) PENNSYLVANIA, PHILADELPHIA (403) 213-5407 (W) [email protected] [email protected] Joe Kerry [email protected] (610) 361-0355 (H) SOUTHWEST REGION IDAHO, BOISE [email protected] CHILE, SANTIAGO Rick N. Bryson Roger Wright Jose R. Riveros (602) 532-5710 (208) 322-6340 (W) TEXAS, AUSTIN 56-2-735-1423 (W/Fax) [email protected] [email protected] David Calabuig [email protected] (512) 225-1370 INTERNATIONAL ILLINOIS, CHICAGO [email protected] HONG KONG Tad Brinkerhoff, Global Paul S. Haglund Bill Shum Management Center (312) 558-9000 (W) TEXAS, DALLAS/FT. WORTH 852-2756-2286 (801) 422-6252 [email protected] Curtis Harshaw [email protected] [email protected] (972) 602-8500 (W) KENTUCKY, LOUISVILLE [email protected] SINGAPORE Eric Hicks AT LARGE AC Ho Brent Bishop (502) 241-8676 TEXAS, EL PASO 656-838-9201 (W) [email protected] (801) 977-7777 (W) Alan D. Gluth [email protected] [email protected] (915) 351-1100 ext. 108 (W) MASSACHUSETTS, BOSTON [email protected] UNITED KINGDOM Ron Mika Rowland Elvidge [email protected] 01727-863995 (H) [email protected]
winter 2003 33 The Marriott School’s Center for International Business Education and Research (CIBER) was renamed the Global Management Center in August 2002. The center’s name was changed to represent its expanded role beyond the Department of Education’s CIBER program and to elevate international business within the school.
One of the center’s initiatives is a new Global Management Certificate. Available to undergrad- uate and graduate students, the certificate certi- fies a student’s business language capability, experience in international business, and under- standing of international business practices. (See news articles p.23.)
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