The coming years will be a ‘Golden Age’

ELECTRONIC COMMERCE AND BANKING • ENTREPRENEURSHIP FOR THE NEW MILLENNIUM • THE ART OF LEADERSHIP

The coming years will be a

‘Golden Age’ for marketers.Simon M.B.A.’s will lead the way.

The coming years will be a

‘Golden Age’ for marketers.Simon M.B.A.’s will lead the way.

WILLIAM E. SIMON GRADUATE SCHOOL OF BUSINESS ADMINISTRATION / SUMMER 1999

The mission of the William E. Simon Graduate

School of Business Administration is to be a

recognized leader in the creation and dissemi-

nation of an integrated body of knowledge that

has significant impact on managerial education

and practice. The School’s educational programs

focus on graduating outstanding individuals who

are prepared to excel in a dynamic and interna-

tionally competitive marketplace.

contentssimonbusinessW i l l i a m E . S i m o n G r a d u a t e S c h o o l o f B u s i n e s s A d m i n i s t r a t i o n

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2 message from the dean

3 upfrontCooley Named Econometric Society Fellow • Simon’s M.B.A.Program Ranks Around the World • First Conference on Electronic Banking Commerce • Research for the Real World•And More

8 featuresSailing Into Uncharted WatersAccording to Eastman Kodak COO Carl Kohrt, emerging markets

may not always deliver expected profits for eager entrepreneurs.

10 Entrepreneurship for the New MillenniumSimon M.B.A. Students “Learn the Ropes” Through Internships

With Start-Up High-Tech Firms.—by Vicki Brown

14 The Art of LeadershipCarl Sassano ’75, Bausch & Lomb’s COO, provides insight

into management’s truest “art form.”

16 cover storyBRAND MANAGEMENT 2000Simon Links Academia and Business World in Innovative

Brand Management Track.—by Vicki Brown

22 featuresSimon School Announces Named Professorships

25 special reportSimon School to Walk “The Path to Excellence”A special report by Dean Charles I. Plosser outlines new initiatives

to propel the Simon School further into the ranks of the best

business schools in the world.

32 endpieceSimon’s Class of 2000

Summer 1999

14

actions

wordslouder

than

speak

2 SIMONBUSINESS / Summer 1999

DEAN:Charles I. Plosser

SENIOR ASSOCIATE DEAN FOR CORPORATE RELATIONS AND INSTITUTIONAL ADVANCEMENT:Charles W. Miersch

SENIOR ASSOCIATE DEAN FOR FACULTY AND RESEARCH:Ronald W. Hansen

ASSOCIATE DEAN FOR EXECUTIVE PROGRAMS:Richard M. Popovic

ASSOCIATE DEAN FOR M.B.A. PROGRAMS:Stacey R. Kole

CHAIRMAN, PH.D. PROGRAM:Ross L. Watts

ASSISTANT DEAN FOR CAREER SERVICES:Lisa M. McGurn

ASSISTANT DEAN FOR INFORMATION TECHNOLOGIES:Kevin Brennan

ASSISTANT DEAN FOR M.B.A.ADMISSIONS AND ADMINISTRATION:Pamela A. Black-Colton

DIRECTOR OF OPERATIONS AND FINANCE:Martha Every

DIRECTOR OF PUBLIC AFFAIRS:George M. Tomczyk

DIRECTOR OF STUDENT AFFAIRS:Donna Lampen Smith

EXECUTIVE EDITOR:George M. Tomczyk

EDITOR:Nadia Bolalek

CONTRIBUTING WRITER:Vicki Brown

ART DIRECTOR/DESIGNER:Michael T. Johnson

PRODUCTION MANAGER:Dawn S. McWilliams

CONTRIBUTING PHOTOGRAPHY:Cheryl Amati Martin, John MyersPhotography, Jan Regan, David L. Sanford

SIMONBUSINESS, Vol. 15, Number 1 © 1999.Published semi-annually by the University ofRochester, William E. Simon Graduate School ofBusiness Administration, Carol G. Simon Hall,Box 270100, Rochester, New York 14627-0100.

Postmaster: Send address changes to theWilliam E. Simon Graduate School of BusinessAdministration, Carol G. Simon Hall, Box 270100, University of Rochester, Rochester,New York 14627-0100.

© 1999 William E. Simon Graduate School ofBusiness Administration, University of Rochester

A MESSAGE FROM THE DEAN

As we approach the end of the 20th century, few

topics command more corporate attention than

that of our cover story—brand management, or

the managing of an organization’s brands in

order to increase long-term brand equity.

It is therefore not surprising that the Simon

School’s new track in Brand Management is

proving to be of such great interest to students,

corporate recruiters and the business media.

Using Simon’s highly regarded marketing concen-

tration as a platform, the new track blends lead-

ing academic thought with input from marketing experts for some of the world’s

largest multinational brands. As a measure of its impact, the track was cited in the

March 29, 1999, issue of U.S. News & World Report, the same issue in which the

Simon School was ranked once again among the top 25 b-schools in the U.S.

In addition to the satisfaction such recognition brings, however, it also serves as a

very important reminder. If the Simon School is to remain a formidable leader in

M.B.A. education, we must continue to strive for even higher levels of excellence.

During the past academic year, I enlisted the help of our administrators, alumni,

faculty and students in exploring ways to propel the Simon School further into the

ranks of the best business schools in the world. This collaborative effort has resulted

in a set of sweeping initiatives which will enhance the quality of the Simon School and

the levels of customer satisfaction we deliver. I’ve outlined these initiatives in a special

report entitled “The Path to Excellence,” and I invite you to read the synopsis which is

featured in this issue of Simon Business. It will show you how we’re capitalizing on

our strengths—not only by doing more, but by doing better.

I hope you will support us on our journey. Please send me your comments. I look

forward to hearing from you.

Charles I. PlosserDean and John M. Olin Distinguished

Professor of Economics and Public Policy

Thomas F. Cooley, Fred H. Gowen Professorof Economics at the Simon School, has beennamed a Fellow of the Econometric Society, aninternational organization for the advancementof economic theory in its relation to statisticsand mathematics.

The Econometric Society is considered themost prestigious one in the field of economics,with a worldwide membership. Fellows rep-resent the society’s ultimate governing bodyand are consulted on any vital matters of policy.

Cooley, a well known economist with inter-ests in macroeconomics, econometrics and sta-tistics, is a pioneer of modern business-cycle

models, which serve as laboratories for the sci-entific study of the economy. He has usedcomplex models to study the effects of mone-tary policy. The author of Frontiers ofBusiness Cycle Research, he has co-authoredtwo other books and has published papers inmany scholarly journals, including the Journalof Monetary Economics, the AmericanEconomic Review and Econometrica.

Cooley serves as director of the SimonSchool’s Bradley Policy Research Center, whichfocuses on topics that have implications forcurrent public policy debates, and he alsoholds a professorship in the University ofRochester’s Department of Economics.

UPFRONT

Professor Cooley NamedEconometricSociety Fellow

Financial TimesIn January of this year, the Financial Times ofLondon ranked Simon among the top 50 grad-uate business schools in North America andEurope.

The rankings, based on a first-time surveydesigned by the Financial Times to “determinewhich business schools are equipped to preparethe international managers of the 21st centu-ry,” were compiled from information collectedfrom business schools and alumni of the Classof 1995.

The rankings, published in the January 25edition of the Financial Times, included 31 U.S.schools, 8 in the United Kingdom, 3 each inFrance and Canada, 2 Spanish schools, 2schools in the Netherlands, and 1 inSwitzerland. Of the 50 Schools, the SimonSchool placed 21st overall, and 13th in an“M.B.A. course” sub-ranking of criteria includ-ing salary level, percentage of increase in salary,value for money, career progress, job offers perstudent, placement success and employment atthree months after graduation.

U.S. News & World ReportFor the 10th consecutive year, the SimonSchool was ranked among the top25 U.S. business schools by

U.S. News & World Report. In its March 29issue, the magazine ranked Simon 23rd overall;reputation ranking by recruiters improved from27 to 26, and average GMAT score improvedfrom 631 to 639.

In a supporting article on niche programs,“Beyond the Plain Vanilla M.B.A.,” U.S. Newscited the Simon School’s new brand manage-ment track in marketing (see cover story, thisissue) and Class of 1998 graduate ShannonMasten. According to U.S. News, “classes innew-product development, finance and opera-tions, price theory, and leadership helpedMasten develop the requisite skills—and set herapart from the crowd of traditional M.B.A.s”applying for her job.

Business WeekIn the latest Business Week survey, published inOctober 1998, Simon Class of 1998 graduatesranked the Simon School 2nd in the nation incross-functional learning, integration of materi-als among courses and ethnic diversity; 3rd inleading-edge knowledge of faculty; 6th in useof current research/material in teaching andoverall teaching quality; 7th in elective teachingquality, and 10th in approaches to problemsolving and their M.B.A. experience beingworth their investment in time and money.

Simon SchoolRanks Around the World

During the past

months, the

Simon School’s

approach to

management

education has

been recog-

nized in three

major business

publications.

SB

SB

SIMONBUSINESS / Summer 1999 3

In keeping with its reputation for innovationand relevant research, the Simon School heldits first annual Conference on ElectronicBanking and Commerce in New York City onFebruary 11-12, 1999. Funded by an educa-tional grant from Citigroup, the conferenceprovided a unique opportunity for Internetbusiness leaders, academicians and seniorbankers to discuss the impact of high technolo-gy on the banking industry.

“Banks have always been leaders in the useof information technology; indeed, Citigrouphas always been ahead of the curve,” said con-ference co-chair Abraham Seidmann, XeroxProfessor of Computers and InformationSystems and Operations Management at theSimon School. “However, banks are now fac-ing the entrance of Internet-based competitorsto the financial services marketplace. Thesenew entrants focus only on technology deliverychannels—and not on ‘personal relationship’issues like community branching and teller ser-vices—to capture business currently conductedby banks, such as securities trading, investmentmanagement, mortgages, leasing and small-business loans.”

The challenge for money centers, accord-ing to Seidmann, is to reposition themselvesand develop new channels that leverage onelectronic commerce and the Internet, withoutcannibalizing their current sources of profitablebusiness service delivery.

“It became very clear at the conference,”said Seidmann, “that areas in banking such aslending, borrowing, bill-payment services andrisk management are going to go throughmajor changes in the next few years due to therapid deployment of electronic commerce.”

Conference participant Ed Horowitz, corpo-rate executive vice president of Citibank, com-mented: “The transformation of the worldeconomy through the introduction of globaldigital delivery channels requires new businessmodels, strategies, organizations andleaders.” With its planned series of annualconferences on electronic banking andcommerce, Citigroup and the Simon Schoolhope to lead the way in communicating theoutcome of cutting-edge academic research tothe banking community, thus enabling banks tofind sophisticated and applicable ways of lever-aging new technology to develop a sustainablecompetitive advantage.

“This is a pioneering conference model,where we listen as well as communicate,”explained co-chair Rajiv M. Dewan, assistantprofessor of computers and information sys-tems at the Simon School. “We have estab-lished an ongoing dialogue between academi-cians and the business community that willallow us to present our research and receivefeedback on what does and doesn’t work.”

In addition to Citibank’s Ed Horowitz,attendees at the first conference in Februaryincluded Wendy Brown, vice president/strategy,America Online; Nicole Vanderbilt, groupdirector/digital commerce, Jupiter Com-munications; Gregor S. Bailar, executive vicepresident and CIO, NASD Inc. TechnologyServices; Dean Charles I. Plosser, Simon School,University of Rochester; Professor AndrewWhinston, MSIS Department, University ofTexas, Austin; and Professor FlorianZettelmeyer, University of California at Berkeley.

The next Simon School Conference onElectronic Banking and Commerce will takeplace in New York City in February 2000.

Simon SchoolHolds FirstConference OnElectronicBanking andCommerce

UPFRONT


“We have estab-

lished an ongoing

dialogue between

academicians and

the business com-

munity that will

allow us to present

our research and

receive feedback

on what does and

doesn’t work.”

For information on the conference series,please contact:

Professor Abraham Seidmann Phone: (716) 275-5694 E-mail: [email protected]

Professor Rajiv M. DewanPhone: (716) 275-3827E-mail: [email protected].

SB

Professors Abraham Seidmann,left, and Rajiv M. Dewan


Julian Keilson, professor emeritus of businessadministration at the University of Rochester’sSimon School and of statistics at the Universi-ty’s College (arts and sciences), died onMonday, March 8, 1999, after an extended ill-ness. He was 74 years of age.

A graduate of Brooklyn College with a B.S.in physics, Keilson earned his M.A. and Ph.D.at Harvard University. He joined the businessschool at the University of Rochester in July1966 and for over 30 years taught courses inapplied probability. His research interestsincluded the areas of probability theory, queu-ing theory, stochastic processes, telecommuni-cations and performance analysis for computersystems. He is remembered for starting theUniversity’s statistics department.

“Julian Keilson was a highly-valued andrespected member of the Simon School commu-nity,” said Ronald W. Hansen, senior associatedean for faculty and research at the SimonSchool. “In addition to being one of the toppublishers in applied probability, he taught sev-eral generations of Ph.D. students, who arethemselves making a substantial impact on theprofession.”

Keilson’s for-mer studentsinclude the dean ofthe InternationalUniversity ofJapan and an asso-ciate dean at theMassachusettsInstitute of

Technology’s Sloan School of Management.Keilson’s sustained research productivity,

which earned him international recognition,gave rise to over 127 papers and two books,Green’s Function Methods in ProbabilityTheory and Markov Chain Models—Rarityand Exponentiality. In spring 1999, KluwerAcademic Publishers released Advances inApplied Probability and Stochastic Processes(edited by J.G. Shanthikumar and UshioSumita), which is dedicated to Keilson and hiswork in various areas, including applied proba-bility, stochastic processes and computationalprobability among others.

Prior to joining the University of Rochester,Keilson conducted research at HarvardUniversity, Lincoln Laboratories and G.T.E.Laboratories. He also served as a research fel-low at the University of Birmingham, and as asenior scientist at Sylvania Applied ResearchLaboratory. In recent years, he had spent timeat M.I.T. as an adjunct professor at the SloanSchool of Management, and at G.T.E.Laboratories as a senior scientist.

Keilson founded the journal StochasticProcesses andTheirApplications, andhad served asassociate editor ofAdvances inAppliedProbability andOperationsResearch. He wasa fellow of theInstitute ofMathematicalStatistics and wasactive inINFORMS.

He is survivedby his wife, Paula;a son, DavidKeilson of Cary,N.C.; a daughter,Julia Craig ofWebster, N.Y.; abrother, SidneyKeilson ofPotomac, Md.; a

sister, Marcia Harrington of Reno,Nev., and eight grandchildren.

A memorial service was held in Keilson’s honor on March 19, 1999.

Julian Keilson

IN MEMORIAM

SB

“Julian Keilson was

a highly-valued and

respected member

of the Simon

School community.

In addition to

being one of the

top publishers in

applied probability,

he taught several

generations of

Ph.D. students,

who are themselves

making a substan-

tial impact on the

profession.”


Just as the Wal-Marts and Kmarts of the retailworld have challenged the existence of “momand pop” storefronts on Main Street, U.S.A.,Internet portals—those mega-Web sites withhigh traffic and large advertising revenue—arequickly changing the electronic superhighwayas we know it.

In a new study entitled “Portal Kombat:The Battle Between Web Pages to Become thePoint of Entry to the World Wide Web,” SimonSchool faculty members Rajiv M. Dewan,assistant professor of computers and informa-tion systems, Marshall L. Freimer, professor of applied statistics, management science andcomputers and information systems, andAbraham Seidmann, Xerox Professor ofComputers and Information Systems andOperations Management, show that the emer-gence of portals is inevitable as technologycontinues to change and the Internet matures.Through their research, the authors also pre-dict portal growth, the differentiation betweenportals, and also offer an overview of the rela-tionship between “power-house” sites and theirsmaller counterparts.

With over 300 million Web sites now in

existence, finding specific pieces of informationon the Web is becoming more challenging.According to Seidmann, popular search engines(like AltaVista) are becoming tiresome—offer-ing users hundreds and even thousands of pos-sibilities, most of which are off-target or con-tain information of little use.

“As the Internet is becoming a seeminglybottomless pit of information,” Seidmann says,“users will rely more on specialized-portal sitesthat have already done the editorial legwork toimprove relevance and quality.”

According to the study, portals will soonserve as decision-making gatekeepers to theWeb—deciding everything from how userssearch for information to whom they chatwith. For example, users can simplify a searchfor information by using sites likeMedscape.com for medical information tech-nology developments. Yet as these large sitesgain more power and influence over “Web-surfers,” the stakes to be in these positions willrise, forcing cut-throat competition and theneed to differentiate to survive economically.

Differentiation is the key to survival for

Seidmann

Dew

an

Freimer

Wal-Marts of the Web Prepare forPortal Kombat

(Continued on page 31)

Researchfor the

Real World

The worldrenownedSimonSchool facul-ty continuesto provebusinessresearch isalive and wellbeyond theclassroom, asnoted in thefollowingresearchsummaries.


While gaining access to the Internetthese days is more affordable than ever,a new study by Simon School professorspredicts Web-surfers will soon pay foron-line content that once carried mini-mal charges or was available for free.“Internet Service Providers, ProprietaryContent and the Battle for Users’Dollars,” counteracts the illusion thatconsumers are saving money as compe-tition increases and prices decrease inthe heated Internet access wars. Thestudy predicts that fees for obtainingpopular on-line information—frommovie reviews to airline fares to stockmarket quotes—will rise proportionate-ly, counteracting a significant part ofthe bottom-line savings. Further, somecontent providers who had previouslyprovided content for free will begin tocharge a fee for at least some of this—often by classifying part of the contentas “premium.”

“The Internet is fast becoming anamusement park that charges for bothadmission and tickets for individualattractions,” says Professor Rajiv M.Dewan of the Simon School. “As thecost of admission drops, more Internetattractions will charge higher fees withthe consumer doing better, but not aswell as some might expect.”

Dewan conducted the study with fel-low Simon School professors MarshallL. Freimer and Abraham Seidmann. It

is the first to develop models that exam-ine the economic link between Internetservice providers (those providing accessto the Internet) and content providers(those offering information and serviceson the Internet).

According to Dewan, firms provid-ing valuable content on the Internet“rely on access providers to bring cus-tomers to their doorsteps. Conversely,the access providers serve customerswho are attracted to the Internetbecause of specific content offerings.”

“The relationship between accessproviders and those dealing in contentis very symbiotic,” says Dewan.“Factors affecting one will have dra-matic results on the other and in turn,every customer utilizing their services.Some of these factors include technolo-gy and the changing telecommunica-tions marketplace. Providing access isbecoming a commodity business inwhich prices are decreasing and onlyfirms utilizing large networks can sur-vive. In such an environment, cus-tomers arrive at the content providers’doorsteps with more money remainingin their pockets, and the contentproviders take advantage of this by rais-ing prices.”

Seidmann points out that “Someusers are likely to even be priced out ofthe market for content due to growingdemand by the global users’ communi-

ty.” In establishing these trends, thestudy cites the 1997 business deal inwhich American Online (AOL) sold itsaccess division to WorldCom whileabsorbing CompuServe’s content andcustomers. AOL’s shift in focus fromaccess to content sent up a red flagabout the future of the industry.

“This particular trend is taking theemphasis off access, which offers lessprofit opportunity, and increasing thebusiness focus on content where there ismore money to be made,” says Dewan.

The study also compares content tothe business of providing other informa-tion goods (i.e., software and movies)with higher development costs and lowvariable costs. In addition, very fewcontent providers compete in the samearea and many have near monopolies,such as DowJones for financial infor-mation and Lexis-Nexis for newsretrieval.

“Falling access costs paint a pictureof better Internet value, but in realityallow specialized content providers toincrease their fees,” adds Dewan.“Surfers will also find themselves pay-ing for information that they previouslyhad received free of charge.” The studyalso explores taxation as another issuethat could dramatically affect Internetconsumers. Ten states plus the Districtof Columbia currently levy taxes onInternet access.

Internet Taxation*

* Shaded areas indicate areas in which

Internet access (from America Online to indi-

vidual Internet service providers like

EarthLink) is taxable: Connecticut, District of

Columbia, Iowa, New Mexico, North Dakota,

Ohio, South Carolina, South Dakota,

Tennessee,Texas and Wisconsin.

Source: CyberTax channel at www.vertexinc.com

Surfers Beware:Costs for Web Info Expected to Climb!

NorthDakota

SouthDakota

NewMexico

D.C.

Iowa

Ohio

Tennessee

Texas

SouthCarolina

Wisconsin

Connecticut



Huge and largely untapped, today’s emergingmarkets might be seen by future historians asthe late-20th-century equivalent of the 1849California gold fields.

But like the many unsuccessful “49ers”who flocked to Sutter’s Mill on the hope ofpanning the nugget that would make their for-tune, some companies are rushing to the PacificRim, Latin America and other economicallyemerging areas without fully preparing for thehigh-risk/high-reward nature of such ventures.

So believes Carl Kohrt, Eastman KodakCompany’s chief operating officer.

As the person who led the team that closedKodak’s recent $1 billion investment in China,Kohrt bemoans the fact that firms—both large

and small—are sometimes too quick to try tocapitalize on emerging markets’ seemingly end-less potential.

Too many companies, particularly smallfirms, he says, see only the potential, thinking,“Look at all those people...if only we could getfive percent of that market.”

While Kohrt does not argue that such mathis tempting, he points out that lack of prepara-tion and research, bad timing and simple badluck can dash an emerging-market entrepre-neur’s hopes and severely tax the resources of amultinational.

Emerging economies, for one thing, do notpresent uniform opportunities, Kohrt says.There is a “portfolio” of varying possible

FEATURE

Sailing IntoUnchartedWatersEmerging markets may

not always deliver

expected profits for

eager entrepreneurs!

During each academic

year, the Simon School is

privileged to host

Frederick Kalmbach

Executive Seminar Series

lectures by senior corpo-

rate executives from

around the world. In fall

of 1998 an executive from

the Simon School’s “home-

town” of Rochester,

N.Y.—Eastman Kodak

Company—spoke about

emerging-market ventures.


rewards, so choices should be made carefully. Russia, whichhad little experience with private ownership and whose con-cepts of private enterprise can seem whimsical to outsiders, isquite different than India, which in Kohrt’s opinion has “toomany rules that slow market development and increase cost.”Kohrt believes China’s beyond-Byzantine system of interlock-ing ministries, state-owned enterprises and government agen-cies is another matter entirely.

With more than one billion potential consumers, China, intheory, is the El Dorado of capitalism. But among some of thequestions those who would venture into the country shouldask are: How ready is the market for their product, and howeasy will it be to get it to consumers?

Even if you know the answers to those questions, Kohrtsays, emerging-market success is far from guaranteed—a lessonrammed home last year during the fiscal meltdown of emerg-ing-market economies ranging from Thailand to Russia.

In emerging economies, the lure of mega-sales and limitedcompetition sits side-by-side with the risk of doing business inarenas far more volatile than in more developed regions.

Some companies try to play a waiting game, Kohrtobserves. They go into a region knowing they won’t makemoney but thinking that an eventual pay-off will make thewait worthwhile. In the meantime, they pour resources intothe venture with no hope of profit, a strategy that Kohrtbelieves is ill-advised.

“Many companies invest in emerging markets with no hope of profitable growth, but profit should be a businessobjective.”

Before venturing into an emerging-market country, Kohrtadds, companies should do spade work—weighing economicand demographic factors that will affect their chances of suc-cess in the market.

What is the country’s gross-domestic-product growth?How does that play against growth in personal income, andhow ready are consumers to spend?

Economic growth drives consumption, he says. But anincrease in the number of households with money to spenddoes not reveal whether a sufficient number of consumers willspend their new disposable income on your product to bringyou a profit. Photographic markets grow at about two timesGDP.

If the numbers indicate that a market could be right, thereare still obstacles to be surmounted beyond those posed by

mature markets. Entry to an emerging-market venture shouldbe planned in stages.

Kohrt counts lack of substantial distribution infrastructuresas a defining characteristic of emerging markets. On thatscore, he quibbles with those who would count Brazil amongthe world’s emerging economies. So, he considers the abilityto create such infrastructures as prerequisite for doing businessin any emerging market.

And once in such a market, Kohrt says, be prepared to dobusiness in ways in which you are probably not accustomed.

In negotiations, be aware of local political currents andhow they may play into your hopes of establishing a venture.In emerging markets, political and business agendas are gener-ally inextricably bound. Do not try to sort them out.

“You may think the person sitting across from you is abusinessman,” Kohrt says. “But he also has a political agenda.In large deals especially, you can’t separate the business andpolitical agendas.”

If legal stumbling blocks arise, it could take more patienceto get over them than they would at home. In emerging-mar-ket countries, Kohrt says “the rule of law is relative. It’s theirlaw. They can change it.”

To help avoid the pitfalls of running afoul of some ill-understood political undercurrent or unexpected legal barrier,he recommends having someone familiar with the local sceneat your side.

Often, emerging-market negotiators simply do not trustWesterners looking to do business in their regions, Kohrt says.And often for good reason. In many cases, they have been illdealt with in the past.

This lack of trust is frequently exacerbated by Westernnegotiators’ arrogance.

“So often Americans go into emerging market countriesand immediately offend by pointing out past mistakes,” Kohrtsays.

“Respect what they have already done,” he advises. “Focuson where they’re going, not on where they have been.”

On a personal level, Kohrt considers curiosity to be anessential trait for any who would hope to succeed in emergingmarket ventures.

“If you’re going to work in a different culture,” he says,“you’ve got to be curious. Curiosity allows you to be moreaccepting of difference. If you’re not curious, you become tooinsulated, too much in your own world.”

“If you’re going to work in a different culture,

you’ve got to be curious.”

SB

Ever since the Simon School announcedit was offering a new program to giveM.B.A. students the chance to “learn theropes” from business entrepreneurs, theprogram’s director has been “staggeredby the interest.” Adds James N. Doyle,“It’s like a piece of mercury that I can’tget to sit still.”

The catalyst was the announcementin June 1998 that Simon was launching,within a new course, internships for stu-dents with start-up, high-tech firms.The announcement noted the newKauffman Entrepreneurial InternshipProgram was established with a grantfrom the Kauffman Foundation, whichis associated with a Kansas City centerfounded by an entrepreneur who built asmall pharmaceutical firm into a billion-dollar health care company.

“Last year we received…a record 91proposals, and the proposal submittedby Simon was the top-rated proposal,”said Steven Rogers, national director ofthe Kauffman internship program and

professor in the Kellogg School ofManagement at NorthwesternUniversity, in a recent interview. “Theproposal from Simon was great. Ourquestion was, can you implement it?We’ve recently renewed for a secondyear because he (Doyle) has implement-ed what he said he would.”

Doyle, a Simon executive professorof business administration and a notedconsultant and lecturer on entrepreneur-ship, explained, “When the School wasgiven the $25,000 award it was basedon the premise that I would select 10qualified students to work with individ-ual start-up organizations. They wouldalso attend a weekly class, and meetwith me bi-weekly to discuss what theywere doing. In addition, I would meetthe first, fifth, and tenth weeks (of thequarter-long internship) with the stu-dents and the host companies.”

He added, “The main thrust of thisprogram, and one of the things that wasinteresting to the Kauffman Center, was

— by Vicki Brown

M.B.A. Students “Learn the Ropes”Through Internships With Start-Up,High-Tech Firms

Entrepreneurship for the New Millennium

FEATURE

Entrepreneurship for the New MillenniumM.B.A. Students “Learn the Ropes”Through Internships With Start-Up,High-Tech Firms


that the interns were not to function asconsultants. They were to be observers ofchallenges taking place in the company andhow they were being met. If, at the sametime, there was an opportunity for theintern to make a contribution because theintern had skills that could be utilized, thatwas fine, but it was not the main reasonwhy they were selected for a particularcompany.”

Doyle approached high-tech start-upshe knew through his business connections,including his former role heading a venturecapital group in Rochester, N.Y., andmatched top Simon applicants with com-panies. By the spring of this year, a lotwas happening because of the stepped-upfocus on entrepreneurship sparked by theKauffman award. Student interns werevery happy with their experiences; start-ups were pleased with their interns; a newnon-credit “short course” on entrepreneur-ship had been held by Simon for non-M.B.A. students; the Kauffman Foundationhad awarded a second-year grant to Simonfor the 1999-2000 school year; studentinquiries about Kauffman internships weretriple what they had been in the first year,and requests were arriving from start-upsinterested in serving as host companies.

‘Phenomenal Experience’ ForIntern Matched With Start-upBeing Courted by Microsoft

Mike Schober, 33, a member of the firstclass of Kauffman interns, said his experi-ence went way beyond his expectations.Schober was matched with OdysseySoftware, a three-year-old company that ismarketing a new family of Windows NTbased middleware connectivity tools usedfor building multi-tier applications onwireless mobile computing devices. WhatSchober couldn’t have known was thatOdyssey, a young firm with fewer than 10employees, had recently gotten the atten-tion of top Microsoft officials.

Mark Gentile, the 38-year-old entrepre-neur who started Odyssey, noted, “Wehave the premier tool for developingmobile applications for the Windows CEplatform (the stripped-down version ofWindows for hand-held products), whichis a very exciting and hot market, andthat’s why Microsoft is very interested inus.” Interest has mushroomed, Gentile

said, ever since he demonstrated his toolone booth at a time at a technical educa-tion show in New Orleans in May 1998.Gentile gathered a crowd of interestedMicrosoft personnel when they discoveredthat his software allowed him to accessand manipulate a database in a wirelessmode from across the showroom floor.They gave him names and numbers to callat Microsoft, Gentile followed up, interesttook off, and shortly thereafter Schoberwalked in the door.

Said Gentile, “As a small companyentering a fast-growth stage, we basicallywere looking for any amount of experiencethat could help us mold our businessprocesses, accounting practices and solidifyour marketing plans. Schober, a part-timeM.B.A. student who recently had signifi-cant input into a $126 million project forhis own employer, stepped in as an internand began observing and asking questionswhile utilizing his own skills. “It’s beenphenomenal,” said Schober.

Although he sees being an entrepreneuras a far-off possibility at this point in hisown life, he said the benefits of working asan intern are of immediate value. Hisemployer, a former major component divi-sion of General Motors, is undergoing dra-matic change and needs “intrapreneurial”skills. “My company, Delphi AutomotiveSystems, was spun off and we’re sendingpeople to start-up manufacturing sites inBrazil, Mexico, China, India, Singaporeand South Africa. Delphi needs peoplewith an entrepreneurial spirit.”

Learning to Market a Productor Service Is ‘Very Valuable’

Robert Holzhauer M.D., a specialist inallergy, asthma and immunology who haspracticed medicine for 23 years and is themanaging director for his medical group,was clearly pleased with his internshipmatch. Holzhauer is pursuing an M.B.A.with a Health Care Management concen-tration and was assigned to intern withLucid, Inc. The company has developed anew type of microscope that creates digitalimages of tissue specimens immediatelyafter they are removed in a biopsy proce-dure, which speeds up diagnosis, a factorthat can be critical for patients needing cer-tain types of surgeries, said Holzhauer.The company is also developing a second

(Continued on next page)


Simon TeachesStudents Howto Analyze,Measure andManage RiskLeonard Schutzman ‘69, a retiredsenior vice president and treasurerfor PepsiCo Inc., points out that

Simon doesnot have a“centerfocus” for itsentrepre-neurship pro-grams butstill has “aremarkablenumber ofgraduates”who’ve suc-cessfullylaunchednew busi-

nesses. A Simon School professorsince 1996 and an alumnus whoavidly pursues his own entrepre-neurial ventures, Schutzman isn’tsurprised the Simon School has avery successful track record despiteits low-key approach.

“The School’s curriculum dealsa lot with risk—how to understandrisk, analyze risk, measure it, andmanage it in terms of what theeconomic tradeoffs are.” In thatregard, he adds, “our curriculum isone of the best (graduate business)programs. Dealing with risk is criti-cal in entrepreneurial situations.”

Another factor in Simon’s suc-cess, he notes, is that nearly half ofthe M.B.A. candidates come fromother countries, giving studentstremendous insights into globalissues when lecture topics, presen-tations or readings are discussed.“Our international students are areal asset in the classroom. You canget a hell of a discussion going.”Schutzman’s classes in New VentureManagement and Entrepreneurship,he says, always include an entiresection on international entrepre-neurship. “What you do in the U.S.is not the same as in Latin America

Leonard Schutzman


instrument designed to create images fromintact skin.

In the course of his internship Holzhauerspent time with Lucid’s president, vice presidentfor technology, sales director, and director ofclinical affairs, not only learning about theirchallenges but also helping them as the result ofhis own experiences in the medical field.Interviewed during his internship, he said,“What I’m getting from them is an insideobservation about how a business is run—thekinds of issues that face business people outsidethe one business that I’m very familiarwith….not that long ago, the idea of marketinga medical practice was looked down upon, butthat is not so much the case now. Learningwhat it takes to market a product or even a ser-vice has been very valuable to me.”

He added, “What I’m doing with Lucid isprimarily helping them with marketing plansfor their Vivascope instruments, providing someinformation about how the medical care reim-bursement system works, and helping them finetune their marketing efforts to target those peo-ple making the decisions.” The value of theinternship, he noted, “is beyond what I hadexpected primarily because I expect to have acontinuing relationship with Lucid in terms ofparticipating in clinical investigations. That’sthe major surprise.”

By Sharing Experiences InternsLearned From Each OtherDavid Lagoner, 31, an M.B.A. student who saidhe has always been curious about the entrepre-neurial process, discovered through his intern-ship with a one-person start-up promoting anew approach to wastewater treatment, howdemanding it can be to launch a business. “It

is easy to say you want tostart your own business, butgetting financing, the prod-uct out the door, and mar-keting is an enormousundertaking, not to betaken lightly.” His experi-ence, he said, was veryrewarding on many levelsbut it underscored for himthat “things take three timesas long as you expect andare usually three times moreexpensive than you expect.”

Both Lagoner andHelen Shi, who internedwith a company developingsoftware designed to enablegroups of end-users to workmore effectively, found it

FEATUREextremely worthwhile to attend weekly meet-ings with Doyle and other interns. As Shipointed out, “As an intern you can only beinvolved with one company. Through sharingwe get to know the different stages of howcompanies are doing.”

Both interns also had high praise for Doyle.Commented Lagoner, “There is no questionthat Jim is very devoted to making entrepre-neurship at Simon work and more specificallythe Kauffman internships.” Neither internwould be surprised to learn that Doyle isalready looking ahead, because Kauffmangrants are only awarded for up to two years.The energetic director is making plans now toseek outside funding so Simon can offer theinternships beyond the 1999-2000 school year.

Simon Offers ‘Short Courses’ in EntrepreneurshipWith interest in entrepreneurship strong andgrowing stronger in the Simon community as aresult of the Kauffman grant, the Schooloffered a special non-credit “short course” inentrepreneurship in fall 1998. The non-creditcourse was open to University of Rochester per-sonnel not enrolled in the Simon School, andwas based on the successful format used inNew Venture Management and Entrepre-neurship, a core course in the entrepreneurshipconcentration. “We thought there might besome limited interest,” says Richard M.Popovic, associate dean for executive programs.“That’s where we were surprised.” The School,he said, filled the class quickly and had to turnaway 30 people who wanted to enroll.

“There’s been a real change in theUniversity’s view of entrepreneurship,” saidPopovic. There is no longer a concern, heexplained, that people want to acquire entre-preneurial skills only to launch their own busi-nesses. There are now many people in depart-ments in the University who have products, ser-vices, or offerings and want to know moreabout marketing them. “That’s an exciting sit-uation that is really innovative for the Univers-ity,” added Popovic.

As a result of the interest in the initial shortcourse and calls from people outside theUniversity who heard about the class, Simon isplanning to offer a similar non-credit shortcourse in fall 1999, open to anyone not cur-rently enrolled at the Simon School.

Vicki Brown is a Rochester, N.Y., freelance writer specializing in business, education, medicine and thenonprofit sector.

“What I’m get-

ting from them is

an inside obser-

vation about

how a business is

run—the kinds

of issues that

face business

people outside

the one business

that I’m very

familiar with….”

—Robert Holzhauer M.D.

(Continued from previous page)

SB

James N. Doyle, Simon executive professor of businessadministration congratulates Kaufmann intern HelenShi ’99, while Sara McLaughlin, assistant director ofalumni relations and development, looks on.McLaughlin coordinated the Kaufmann Grant thatfunded the internship program.


SB

There are a variety of opportunities outsideclass or internship settings for Simon studentsto become involved in projects related to newtechnology. “Students work directly with com-panies ranging from Eastman Kodak andXerox to start-ups with one person,” notesSimon School executive professor PeterWaasdorp ’69, who is responsible for oversee-ing student teams involved in outside projectsin the business community.

Waasdorp notes that a special partnershipbetween Simon and the Center for ElectronicImaging Systems is responsible for generatingsome significant opportunities students have toexplore new technology options. TheRochester, N.Y., center develops leading-edgetechnology in the capture and recording ofimages, and is also engaged in research involv-ing image compression, coding, manipulation,enhancement, storage, retrieval, printing andvisualization. The center, which seeks to movebasic research into commercial applications,has numerous corporate sponsors and is jointlyoperated by the University of Rochester and theRochester Institute of Technology.

Waasdorp, whose own background includes26 years in quality and marketing for Xerox,interfaces with the center and corporate clients,as well as with students working on their pro-jects. When requests are received, he creates aBusiness Innovation Team, consisting of one-to-five interested students with the appropriateskills. Students receive financial stipends to

investigate clearlydefined objectivesfor a given tech-nology. One thirdof the stipendcomes from a NewYork State Science and Technology Foundationgrant, and two-thirds from the client.

In February, Waasdorp notes, he waspleased to see articles in the news mediaannouncing a new alliance between Kodak andSANYO Electric to develop next-generationflat panel displays for use in portable electronicequipment. In 1996 a Simon BusinessInnovation Team did work for Kodak thatinvolved the technology. Jan Haase Ph.D., whowas then director of business development forthe project for Kodak, says the Simon team“gave me some useful insights.” ExplainsHaase, who is now an independent consultant,“We gave them some provocative things tothink about….we didn’t use them as a substi-tute for a professional consulting organization,but as a way of providing newinputs. Our expectation wasnot to use them in place ofpeople who know theindustry but as an exten-sion of our own eyesand ears. It was inter-esting to get their takeon the competitiveenvironment.”

There Are Many Opportunities to ExploreOptions for New Technology

The Center for

Electronic Imaging

Systems is responsible

for generating some

significant opportunities

for students to explore

new technology

options.

or Mexico. Israel is a hotbed of entrepreneurs…and the opportunities in China are very exciting.”

He also incorporates special activities in hisclasses that are designed to give students real-worldexperience with a range of venture capital andentrepreneurial issues. One recent project calledfor students to develop a sales and marketing planfor a high-tech software company looking to reachout to the New York City financial community.Another project was built around research andanalysis for a company exploring marketing oppor-tunities in Asia for hydroponics, which involvesgrowing plants in water or materials other than soil.

The entrepreneurship class, Schutzman adds, alsoincludes a venture capital game. In fall 1998, forexample, students evaluated “five real deals” thathad recently been assessed for funding by a privateequity firm. Students were told they had $50 mil-lion to invest and to decide which companies wouldgive them the highest return in their portfolio.“They had to interview the entrepreneurs, do theresearch and due diligence, and simulate the invest-ment process that venture capital firms go through.”

His goal, Schutzman notes, “is to bring real lifechallenges and issues to campus.”

Simon Teaches Students...(Continued from page 11)

SB

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Photo by Eugene Kowaluk

Leadership ultimately means taking credit forbad as well as good outcomes, says CarlSassano ’75, president and chief operating offi-cer of Bausch & Lomb, Inc.

If you take kudos for successes withoutaccepting responsibility for failures, subordi-nates will quickly tag you as a boss not to betrusted.

The trick, he adds, is to have your successesoutnumber your failures—a feat only thosewho truly understand what a manager’s job is,can accomplish.

Spanning almost a three-decade career atB&L—rising from an assistant product manag-er to president—Sassano has distilled a manag-er’s credo that he believes applies to all leader-ship positions.

What separates a manager from a subordi-nate?

In part, says Sassano, it’s a question ofscope. A vice president of marketing shouldnot be mired in the details of developing andcarrying out a marketing plan, but must stillfirmly direct and inform the efforts of thosewho collect and analyze the data, form a strate-gy and bring it to fruition. In any organiza-tion, the manager should be the prime mover,but not the main character in all the details.

As a top officer at B&L, he says, “I don’twrite the marketing plan, and I don’t execute

it. Everything I do gets done by somebodyelse.”

Still, Sassano says, his job boils down to aspecific set of duties that are essentially thesame for a director of any enterprise.

The first requirement, he says, is to articu-late the organization’s guiding values. Fromvalues flow a vision, and from vision flows therest.

For a CEO, values and vision mean havinga clear picture of what the company is orshould be, and where it is going. A group vicepresident needs to have an image of his divi-sion’s role. A plant manager’s job starts withher notion of how the facility fits in the compa-ny’s overall mission. If it does not conform tothe organization’s basic values, it will not oper-ate at peak.

The foundation from which these valuesshould be distilled is the real world. “Listen tocustomers,” Sassano says. “If you don’t, youwon’t ever understand the business.”

Also listen to those who know and under-stand the business, which is not the same as lis-tening to customers. People who think they donot need such input are either arrogant or sosmart that they need no help from others, andaccording to Sassano, “nobody is that smart.”

From vision, Sassano says, flow an enter-prise’s operating objectives. A good manager’s

FEATURE

“You’d be amazed

by what you can

learn just by talking

to folks about the

problems they

encounter on a daily

basis. People who

deal with problems

every day funda-

mentally know the

solutions.”

The Art of Leadership

Everything you do sends a

and actions spea

During each academic year, the Simon School is privileged to host Frederick Kalmbach Executive

Seminar Series lectures by senior corporate executives from around the world. In fall of 1998 an execu-

tive from the Simon School’s “hometown” of Rochester, N.Y.—Bausch & Lomb—spoke about the “art”

of management.


Before any plans are implemented, Sassano says, a managerhas to make sure that they fit with the values and vision devel-oped at the start of the process, and that they will lead to theaccomplishment of company goals.

A manager’s next order of business must be to see thatemployees have the resources to execute the established objec-tives. Once initiatives are in motion, the manager then needsto set up a system to monitor employee progress.

Resources do not always mean money and staff, Sassanosays. Sometimes it is a question of removing stumbling blocks.In some cases, he says, “I’ve spent more time meeting with dif-ferent groups in an organization to find out whether therewere decisions I could make or people I could nudge thatwould move things along than saying ‘yes you can have morepeople,’ or ‘you can have another $50,000.’ ”

A wise manager, he adds, will make monitoring systemsboth formal and informal. Keep an eye on the numbers, coun-sels Sassano, but do not entirely rely on charts, graphs and for-mulas. “Yes, track sales, but also do what used to be calledmanagement by walking around.”

“You’d be amazed by what you can learn just by talking tofolks about the problems they encounter on a daily basis.People who deal with problems every day fundamentally knowthe solutions.” he adds.

Sassano says that a manager’s role “is to move the processalong. Analysis is wonderful, but only as precursor to action.”

Keeping things moving at the same time is to some extentan art, he adds. You have to know when to exhort, when topraise, when to step in and when to sit back.

“The trick is not just knowing when to intervene but in

role is to see that such goals are established and met or exceed-ed. Simply having a picture of where the company ought to godoes not insure that it will happen. The specifics need to becommunicated, he says.

“You have to lay the vision out. Then it’s everybody’s taskto develop specific plans.”

Communicating the vision should be an ongoing process,Sassano says. A manager needs to tell employees what isexpected of them, keep them apprised of how well they aremeeting those expectations and coach them on how to improve.

knowing how you can fundamentally change how people aredealing with problems.”

Reward those who perform well appropriately, and like-wise deal appropriately with those who do not.

If an employee has, say, delivered outstanding results butruns past a deadline, Sassano advises that the manager focuson the positive outcome rather than the failure. If theemployee needs to be reminded of the importance of meetingdeadlines, do it as much as possible without anger andhumiliation.

Though he concedes that some who have worked underhim can attest to having felt his wrath, Sassano says: “I pridemyself on not being a yeller and a screamer.”

Being unduly harsh will ultimately diminish a manager’seffectiveness, he says. Employees who see their boss as anogre will also see him as someone to be avoided. And whensubordinates stop talking to him, the manager is left in thedark.

While rewards are usually defined as incentives such asbonuses and perks, Sassano sees the elimination of a poorlyperforming team member as a reward of sorts for the rest ofthe group.

Finally, says Sassano, a manager has to remember that allcommunication is not verbal or written and that consistencycounts. Whether you are dealing with subordinates or com-pany directors, others will evaluate you by how well yourbehavior fits with what you say.

“Demeanor counts,” he says. “How you act in meetings,your style, everything you do sends a message—and actionsspeak louder than words.”

Action in fact could be called the essence of what Sassanosees as a manager’s job. Faced with a problem, a CEO mightsee any number of courses he can take, he says.

“The only thing you can’t do is nothing.” SB

message —

ak louder than words


Their destination is Cincinnati and a day-longmeeting with key sales, finance, informationtechnology, market research, and advertisingpersonnel responsible for managing a $180 mil-lion pharmaceutical product for Procter &Gamble (P&G).

By the time the Simon students retrace thesame 500 miles that evening, they are thor-oughly briefed on how a brand managementteam works together at P&G, a company wide-ly regarded as the worldwide leader in brandmanagement theory and execution. They also

come home with a challenging assignment, acritical deadline and true competitive spirit.Working together, Simon and P&G have madeit possible for the students to access a huge newdatabase, including over 23,000 records forAsacol®, a drug used to treat ulcerative colitisand a strong profit contributor to P&G’s bot-tom line. Four different Simon teams will tack-le the database—referred to by one student as“the 800-pound gorilla.” They must alsolocate additional quantitative and qualitativeinformation, determine the marketing implica-

—by Vicki Brown

COVER story

At dawn on a cold January day, 25 students

enrolled in the new Brand Management Workshop

course at the Simon School find themselves on an

airplane, traveling nearly 500 miles to get to class.

Asacol®: Simon studentsbecame members of theAsacol® brand manage-ment group for Procter& Gamble


tions of the data when combined with their own research,and prepare suggested recommendations in time for areturn visit by key members of the Asacol® brand manage-ment group. The P&G team is studying the database con-currently and the brand manager, assistant brand manager,and information technology manager traveled to Rochesterin mid-March to receive the students’ oral and writtenreports and give feedback on the student presentations. Ina first for Simon, the business professionals will also play arole in determining the students’ marks on their projects.Students already know their team’s project—worth 75 per-cent of their own workshop course grade—will be scoredon a curve.

Paul Nelson, the associate professor of marketing whocoordinated this innovative class project, calls the Brand

Management Workshop coursethe capstone of the new brandmanagement program at Simon.The overall program, which mar-ries academic work and real-world experience, is a sub-special-ty of marketing at the SimonSchool. The new track was offi-cially launched in September1998, and is believed to be thefirst of its kind at the leadinggraduate business schools in the

U.S. It is being offered at Simon for several compellingreasons.

Student interest in brand management careers has beenrising in recent years and is now very strong. There is also

growing employer demand fortalented, cross-functionallytrained M.B.A. graduates whocan step into challenging entry-level brand management positionsand ultimately move up the man-agement ranks. Finally, brandmanagement is a natural fit forSimon as a result of the School’seconomics-based approach tomanagement, recognized reputa-tion in finance and accounting,

and strong emphasis on technology and team building.Simon’s student population also reflects the diversity oftoday’s global marketplace, with over 40 percent of stu-dents coming from countries outside the U.S. Inaddition, 25 percent of the student body eithermajors or double-majors in marketing.

Ronald W. Hansen, senior associate deanfor faculty and research at Simon, points outthat brand managers need a broad backgroundand a range of skills. “Our M.B.A. stu-dents must develop strong technology skillsand learn key aspects of finance, account-ing, operations and marketing, in additionto concentrating in a specialty area. Thatmeans they are exposed to product plan-

ning, distribution, cost accounting, advertising, and numer-ous other areas associated with brand management.”Hansen emphasizes, “Simon is known for training peoplein cross-functional skills. Our faculty members work aseasily with students in marketing as they do with studentsin finance.”

Brand Management Is a Huge ChallengeAs more companies recognize their brands are among theirmost valuable corporate assets, talented brand managersare becoming extremely important in a wide range of busi-nesses. Increasingly, companies are also using their brandsas a foundation for their business strategies. (See sidebar,“What’s a Brand Worth?,” page 21.)

In our complex communications environment, con-sumers are bombarded with marketing messages at everyturn. Brand managers must focus like a laser and targetresources effectively in order to get consumers to rememberand recall specific products when they are ready to make apurchase. Launching a new brand, maintaining an olderor aging brand, or extending a brand in today’s crowdedmarketplace is a huge challenge that involves major finan-cial implications for a company. In a digital age character-ized by globalization, it is also becoming almost imperativefor international corporations to follow a successful prod-uct launch in one part of the world with other successfullaunches. They must move quickly and effectively in other

parts of the world—with an eye to localcultures and customs—in order to prevent

competitors from capitalizing on theopportunity.

The concept of branding, howev-er, is not limited to products.Hansen points out that it can apply

Paul Nelson

Tide is one of Procter &Gamble’s most successfulbrand management successes.

Ronald W. Hansen


“The concept of branding, however,

is not limited to products...it can

apply to the service sector as well.

Chase is a brand, Schwab is a

brand, and so is Dean Witter.” —Ronald W. Hansen


to the service sector as well. “Chase is a brand, Schwab isa brand, and so is Dean Witter.” Published experts in thebrand management field have also noted that branding isnot exclusively used by the for-profit sector. For example,National Geographic is a nonprofit scientific and educa-tional membership organization but it conducts surveysand examines perceptions of its image in regard to itsmagazines, books, television shows, and gifts. In addi-tion, experts often note the power of popular movies toserve as catalysts for new brands, as evidenced by the phe-nomenal success of the “Star Wars” series.

The notion of having a brand actually dates back tothe era of craftsmen, when individuals marked their hand-crafted goods so customers would be able to identify theirwork. However, the term brand management wasn’twidely used until the early 1970’s, says Cindy Reid, aRochester business executive with 20 years experience inthe brand management field and a lecturer in marketing atthe Simon School. Reid, who helped advise the School asit put together its new program, points out that when shewas hired in 1976 by Kimberly Clark for a brand manage-ment trainee position, most of the people in brand man-agement were sales people. “Marketing was really thoughtof functionally—as advertising, promotion and sales.Marketing was very tactical and strategic planning wasmore of a ‘wish’ than a reality.”

At that time, she notes, “the majority of the big-pack-aged goods companies had brand management trainees,but they all did brand management differently.” By themid-1980’s, brand management had evolved into brandadvocacy within large organizations. “If I was a SwissMiss Pudding product manager, my job for the organiza-tion was to grow Swiss Miss Pudding past our goals.”Today, she adds, the organizational structure in manypackaged goods companies “looks like a hierarchy ofbrand managers.” Individual brand managers oftenreport to directors of marketing, and many directors, in

turn, report to top-level marketing executives, with eachlevel up the organization having more significant brandmanagement experience than the level below.

Reid notes, “Brand managers are not as well knownoutside the packaged goods environment, but productmanagers are usually in every company I can think of.Although they overlap significantly, they are not the same.A product manager is much more involved in the designof a product, less involved in the advertising and promo-tional aspects, and is really more of a liaison between thecustomer and the company.”

“Today a brand manager is a brand advocate who hasresponsibility for understanding and recommending pro-grams for his or her brand, and for gaining the support ofthe organization. These are individuals who must createfunctional synergy.” Reid stresses, “To be successful youneed to be able to read financial statements and balancesheets and understand how they impact your ability to getfunding for your brand. You also need to know the mar-keting side, not so you can do the market research andadvertising, but so you can direct it. You have to be ableto review the output of creative departments. You alsohave to interact with sales because it has the responsibilityto sell the product you need to hit your P&L (profit andloss) plan. In addition, you have to understand researchand development. The brand manager is responsible forall the details for coordinating what can be a chaotic job.”

People skills, she adds with emphasis, are also impor-tant to companies searching for brand management talent.“Companies look for people who have leadership posi-tions in school—individuals who have taken on theresponsibility of being a leader and have persuaded peopleto do something.”

The New Program Is theResult of a “MarketingPhenomenon”The decision to launch a new Brand Management track atthe Simon School really was due to a “marketing phenom-enon,” says Dan Horsky,Benjamin L. FormanProfessor of Marketing andMarketing area coordinatorfor the School. “Last year 11percent of our graduates tookmarketing jobs. Looking atthose students one thingbecame evident. Most ofthose students wanted to bebrand managers.” At thesame time, Horsky adds, theSchool was aware that Simon graduates were making astrong impression as brand managers in the marketplace.

Todd A. Garrett, P&G senior vice president and CIO,underscored that point when he spoke at a special Simonbrand management conference, which was held in

COVER story


Dan Horsky

“Today a brand manager is a brand

advocate who has responsibility for

understanding and recommending

programs for his or her brand, and

for gaining the support of the organi-

zation. These are individuals who

must create functional synergy.”

—Cindy Reid


October 1998 as part of alumni weekend. (See conferencestory, “The Coming Years…” page 21.) “We’ve had a verysuccessful track record of recruiting and retaining out-standing people in brand management, as well as financialmanagement, from the Simon School….the statistic thatinterested me was three-quarters of the people we hiredinto brand management are still with the company and

going up. That is at least 25percent higher than average.Brand management is the feederfor general management.”

Horsky says that a year agothe School organized a smallpilot workshop course and gavestudents, as part of the course,the opportunity to develop acomprehensive brand manage-ment strategy for a potentialSimon program. In other

words, the School asked marketing students how theywould market the Simon “brand.”

As a result of input, research, and advice from faculty,employers, advisors and students, Simon launched the cur-rent program, which draws heavily on the School’s exist-ing strengths. Students interested in brand management,like all students at the School, take specified courseworkin many different disciplines. In addition, if they are mar-keting majors interested in brand management, they takemarketing research and three electives in the four P’s—price, promotion, place (or distribution) and product.The special workshop course is taken by students in theirsecond year, and is designed to meld what students havelearned in academic classes in a real-world experience.

This past winter Paul Nelson, who teaches the work-shop course, arranged a second customized seminar forstudents at a corporation that has an exceptionally strongbrand history, but one far different from that of P&G,which is essentially a company of brands that are nowmore than 300 strong (e.g., Pringles, Pampers,Tide). Eastman Kodak Company, in contrast, isknown for one brand. The second seminar, atKodak headquarters in Rochester, N.Y., wasarranged with the assistance of Sarah Kutulakos’96, who is product manager for 35 mm camerasin Kodak’s Consumer Imaging division.

One key seminar speaker was Betty Noonan,who directs worldwide branding in the chief mar-keting office for Kodak ConsumerImaging. Among other areas,she addressed how overall-brand equity influences Kodakproducts and activities andhow it intertwines with thecompany’s sub-brands. Shealso talked about what thecompany does to keep itsbrand strong and its messageconsistent throughout all of itsproducts.

Kutulakos says Kodak was aware students had trav-eled to P&G and would be looking to compare practicesbetween the two corporations. She turned to DanPalumbo, chief marketing officer in Consumer Imaging,who came to Kodak in 1997 from P&G, to explain “whywe look very different from P&G…what areas we want toimprove, and in what other areas we will always be differ-ent and why.”

Overall, Kutulakos says, “the thing we were trying tofocus on is that first and foremost the company name isour brand. We are all stewards of something much bigger.In my case I focus on cameras—Kodak cameras. I don’t

control the Kodak part. That is controlled ata higher level because it is so valuable.”

In addition to the seminars in the work-shop course, there were other guest speak-ers, lectures and selected readings. Nextyear, Simon is adding yet another newdimension to its Brand Manage-ment track.

Every student in theprogram will bepaired with a men-tor. The mentorswill be Simon alum-ni who are workingas brand managers,and the program is

anticipated to beanother first amongtop M.B.A. programs.

Todd A. Garrett


“We’ve had a very successful

track record of recruiting and

retaining outstanding people in

brand management, as well as

financial management, from the

Simon School….the statistic that

interested me was three-quarters

of the people we hired into brand

management are still with the

company and going up.”

—Todd A. Garrett


COVER story

‘The Project Was a SolidLearning Experience….You Didn’t Know WhereYou Would End Up’(Continued from previous page)

Read what Ralph Marburger, a June graduate who hasaccepted a position as an assistant brand manager atClairol, says about the pharmaceutical drug project withP&G and how well it reflected real-world experience. “Itwas by far the most competitive class I’ve ever taken atSimon. Everyone protected their own research and theirown data. We put in hundreds of hours and did a lot ofsecondary research. We talked to numerous gastroenterol-ogists and other physicians, including the president of theCrohn’s and Colitis Foundation, the patient advocacygroup in the area.”

Adds Marburger, “The day in Cincinnati was reallyawesome. The whole (Asacol®) team was there. Theywere very open, except for the most sensitive data. Weasked two hours worth of questions, but we saved ourbest questions to ask later (using E-mail) because we knew other (Simon) teams were in the same room.”

He describes the experience as a “solid learning experi-ence with hands-on actual data. It was not a Harvardbusiness case. You didn’t know where you would end upwith your recommendations. You had to figure out theproblem for yourself. You just had data. You had to determine your objective and a marketing plan to meet it.”

Louis Applebaum ’95, a brand manager for Canan-daigua Brands, a nationally known wine and spirits com-pany, came back to Simon to enroll in the workshopbecause he was interested in “sharpening his skills” with-out leaving his company. As a brand manager, he says, hegot the most from the company presentations. “Learningabout how P&G, a benchmark company, approaches aproject and executes against it was a key learning experi-ence for me. The Kodak presentation was also very help-ful.” The value, he adds, was in learning how leadingcompanies manage their brands, whether they are “awhole trademarked corporation or have a trademarked setof brands.”

For Dan Hecht ’92, who is both a Simon alumnus andthe Asacol® brand manager for P&G, the experience was“a win-win” for both the School and his company. “Ourprimary role was to have them (students) understandbrand management—what the job and the role look like.”From P&G’s perspective, he adds, “we’re helping thembuild students that we’d like to hire.”

At the end of student presentations on March 10,Hecht’s team told the students they “had set them up for achallenge.” In return, the students had given them usefulanalyses, ideas and insights to take back to Cincinnati todigest. Hecht also told the Simon group, “It is reallyrefreshing to have 25 experts in our category. It’s notoften you hear so much analysis. That’s fantastic.”

Added Hecht as he packed to leave, “and both sideshad a lot of fun doing this.” SB

“The experience was a solid

learning experience with hands-

on actual data. It was not a

Harvard business case. You

didn’t know where you would

end up with your recommenda-

tions. You had to figure out the

problem for yourself. You just

had data. You had to determine

your objective and a marketing

plan to meet it.”—Ralph Marburger ’99

From left, David Blum ’99, Dan Hecht ’92and part-time student Wanda Trevino


Pantene is the No. 1 shampoo in the world, and isnow a $1.5 billion franchise. When Procter &Gamble acquired it in a 1985 acquisition it wasworth only $70 million. At the time it was a smallspecialty brand that had been around for 40years. It stood for hair health, as a result of its“pro-vitamin” ingredient, and had a small userbase in several parts of the world. The issuewas—why wasn’t it a bigger brand?

The company launched a global study todetermine what healthy hair meant to con-sumers. The response from consumersaround the world was healthy hair isimportant and healthy hair is shiny hair.P&G turned that response into anadvertising slogan—“Hair So HealthyIt Shines”—and visualized the healthyhair benefit in its ads. In fact, the com-

pany searched the world for shiny hair andlocated the ideal person in Taiwan. With

new advertising, the company entered 30countries in 10 months. In one market after

another Pantene shot to leadership position.How valuable was Pantene’s success to

P&G? Todd A.Garrett answers the question thisway. “Pantene’s success drove a complete turn-

around of our entire hair care business, which afew years ago was barely profitable and was far

away from any kind of leadership.” He added, “Wetook a tiny brand in the hair care category and turned

it into a key driver of total sales and profit growth forthe corporation.”

Editor’s note: The above information is based on a presentation atSimon’s fall Alumni Weekend Branding and Brand Management

Conference by Todd A. Garrett, a top Procter & Gamble executiveand a leading player in the success of the brand described.

What’s a Brand Worth?

“The coming years are the golden age for marketers,” pre-dicted a Procter & Gamble top executive at a specialBranding and Brand Management Conference sponsored bythe Simon School during its fall alumni weekend.

Todd A. Garrett, a 1963 University of Rochester graduateand a key player in the success of three top P&G products—Pringles, NyQuil and Pantene—said marketers should anticipate“globalization the likes of whichthe world has never seen before.”Garrett, P&G senior vice presi-dent and CIO, spoke about glob-al branding as one of four keyconference speakers. DanHorsky, Benjamin L. FormanProfessor of Marketing at Simon,kicked off the event with anaddress on branding and brandmanagement and also outlinedwhy the Simon School has initiat-ed its own brand managementtrack.

Other presenters includedWilliam J. McEwen, vice presi-dent and managing director forthe Gallup Organization’s BrandResearch Group, on measuringbrand equity and brand loyalty,and John M. Keil, a 1944 University of Rochester graduate,author of The Creative Mystique and former executive vicepresident of Dancer-Fitzgerald-Sample. Keil is best known asthe voice of television’s McGruff, the Crime Dog (“TAKE ABITE OUT OF CRIME”), and his entertaining luncheon pre-sentation highlighted well-known advertising campaigns.

McEwen said Gallup measures five components relating

to the “health” of any brand. These components includebrand presence (consumers know it exists and know what itoffers); brand position (perceptual attributes, images and per-sonality); brand experience (product and service satisfaction);brand value (consumer would pay more, work harder or waitlonger), and brand loyalty (attitudinal and behavioral com-

mitment to using the brand). Thekey to increasing brand loyalty lies inbuilding brand differentiation.McEwen pointed out that unlessthere is relevant brand differentiationthe brand isn’t worth more. Henoted, “Toothpaste had largelybecome a commodity until Crest gotADA (American Dental Association)endorsement.”

Global branding, Garrett said, “isa tough nut to crack,” but also excit-ing work. “It is intellectually chal-lenging, very competitive, but veryrewarding when you figure it out.”P&G, known worldwide as a cham-pion of branding, has been focusedon globalization as a key growthstrategy for only the past decade, hesaid. “We have entered 30 new mar-kets in the last 10 years and nowhave on-ground operations in more

than 70 countries.” However, he added, “of the 16 largestbrands in the company only three are global franchises—Pantene, Always and Pringles.” He said his company believesit is developing a successful model for global branding. Thatmodel includes four key principles: Understand the con-sumer, clearly define the brand’s equity, test and expand suc-cess models, and continue experimenting.

The Coming Years Are the ‘Golden Age’ for Marketers

SB

SB

“ Global branding...is intellectuallychallenging, verycompetitive, butvery rewarding whenyou figure it out.”



Simon School AnnouncesNamed Professorships

Michael J. Barclay, Alumni Distinguished Professor ofBusiness Administration, professor of finance and Financearea coordinator, joined the Simon School faculty in 1985.

In October 1994, Barclay was ranked by Business Weekmagazine as one of the top 12 business professors in theU.S. He was honored with Simon School M.B.A. SuperiorTeaching Awards each year from 1991 through 1995, andagain in 1997, 1998 and 1999.

Barclay has research interests in corporate finance, thestructure of corporate liabilities, the role of large-blockshareholders and active investors in public corporations,and the tax management strategies of mutual funds. Hisresearch has been published in many scholarly journalsincluding the Journal of Financial Economics, The Journalof Finance, the Review of Financial Studies, the Journal ofLaw and Economics, and the Journal of Applied CorporateFinance; he is also an associate editor of the Journal ofFinancial Economics, the Journal of Financial andQuantitative Analysis, and the Journal of Accounting andEconomics.

Barclay has been engaged in a variety of managementconsulting activities and has served as an expert witness incases involving securities litigation, financial market opera-tions and antitrust economics. He has also taught at theUniversity of Pennsylvania’s Wharton School, where hewas honored as a finalist for the Helen Kardon Mars AnvilAward for outstanding teaching.

Before joining the faculty of the Simon School, Barclayserved as a research assistant at the Institute for the Future,where he developed models for corporate strategic plan-ning and econometric forecasting. He won the ShortliffePrize as the outstanding graduate of the Department ofEconomics, Colgate University.

Barclay holds a B.A. degree (summa cum laude) inmathematics and economics from Colgate University, and aPh.D. degree in economics and business from StanfordUniversity.

James A. Brickley, Gleason Professor of BusinessAdministration and professor of economics and managementand of finance, taught at the Simon School from 1986 to1989, and rejoined the faculty in 1991.

Brickley is a nationally recognized expert on corporategovernance and franchising. A former chairman of the SimonSchool’s Committee on M.B.A. Programs, he also has researchand teaching interests in the economics of organizations, cor-porate finance and banking.

From 1989 to 1991, Brickley was chairman of the FinanceDepartment and research director at the University of Utah’sGarn Institute of Finance. Prior to his position at theUniversity of Utah, Brickley was an associate professor of eco-nomics at the Simon School. In 1987 he was presented theSuperior Teaching Award by the Simon School M.B.A. Classof 1988.

Brickley’s papers have been published in the Journal ofBusiness, the Journal of Law and Economics, The Journal ofFinance, the Journal of Accounting and Economics, theJournal of Financial Economics, the Journal of EconomicPerspectives, the Journal of Risk and Insurance, the Journal ofFinancial and Quantitative Analysis, Financial Managementand the Journal of Corporate Finance.

Brickley, with Simon School professors Clifford W. SmithJr., and Jerold L. Zimmerman, co-authored ManagerialEconomics and Organizational Architecture, published byIrwin/McGraw Hill.

In addition to his academic achievements, Brickley hasbeen a consultant to major corporations and law firms onorganizational issues and franchising. He has also held vari-ous positions in government in the state of Oregon, includingexecutive director of the Jackson-Josephine County C.E.T.A.Program, public transportation planner for the Rogue ValleyCouncil of Governments and economic analyst for an eco-nomic-development district.

Brickley earned his B.S., M.S. and Ph.D. degrees, all ineconomics, at the University of Oregon.

The Gleason

Professorship in

Business Administration

was established in

1986 through a grant

from the Gleason

Memorial Fund.

The Alumni Distinguished Professorship in

Business Administration was established in

1986 through contributions from 800 Simon

alumni. Faculty, staff and a number of private

benefactors also contributed. A gift from the

1985 Class of the School’s Executive

Development Program provided the final gift

which allowed the establishment of the Chair.

FEATURE


G. William Schwert, Distinguished University Professor andprofessor of finance and statistics, joined the Simon Schoolfaculty in 1976.

Schwert has research and teaching interests in portfolioand capital-market theory, corporate finance and control,econometrics and time-series analysis, and in the effects ofpublic regulation on business. From 1978 until 1982, hisresearch was sponsored by the National Science Foundation.During 1982, he was the first CRSP Distinguished ResearchScholar at the University of Chicago. He received aBatterymarch Research Fellowship for the 1982-83 academicyear. In 1990, Schwert won the Graham and Dodd Plaquefor the best paper (“Stock-Market Volatility”) published inthe Financial Analysts Journal, and he won a Smith-BreedenDistinguished Paper Award for one of the best papers (“WhyDoes Stock Market Volatility Change Over Time?”) publishedin The Journal of Finance.

An editor of the Journal of Financial Economics since1979 and the managing editor since 1995, Schwert is an asso-ciate editor of The Journal of Finance and an advisory editorof the Journal of Monetary Economics. His current researchdeals with the effects of anti-takeover devices on takeoveractivity, hostile takeovers, initial public offerings and withstock market volatility.

In 1986, he was named Gleason Professor of BusinessAdministration.

Schwert holds an A.B. degree in economics from TrinityCollege, and an M.B.A. degree in finance from the Universityof Chicago, where he was also awarded the Ph.D. in financeand econometrics.

The Distinguished University

Professorship is awarded by the

University of Rochester to those indi-

viduals who have distinguished them-

selves through outstanding service to

the institution and significant accom-

plishment in their field of expertise.

Ongoing support and continuing renewal of the Simon faculty is essential for maintaining the School’s international reputa-

tion as a leading educator of future managers. Named professorships are one important tool used to accomplish this. They

earn recognition within the scholarly community and confer the independence to pursue innovative educational and research

ideas. Today, over 25 percent of the Simon faculty hold named professorships.

Jay A. Shanken, Frontier Corporation Professor ofBusiness Administration and professor of finance, hastaught at the Simon School since 1985.

Shanken has research interests in the theory and testingof asset-pricing models, empirical work in finance andaccounting, and applied and theoretical econometrics.

He is an associate editor of The Journal of Finance andthe Review of Quantitative Finance and Accounting, anadvisory editor of the Journal of Financial Economics, anda research associate at the National Bureau of EconomicResearch. A Schwabacher Fellow, he was awarded theBerkeley Doctoral Prize in Finance and an EarhartFoundation Fellowship. He was a Batterymarch Fellowfor 1986-87, and received the Rose Murry Prize of theInstitute for Quantitative Research in Finance in 1997.

Shanken’s papers include “The Arbitrage PricingTheory: Is It Testable?” (The Journal of Finance, 1982);“Multivariate Proxies and Asset Pricing Relations: LivingWith the Roll Critique” (Journal of Financial Economics,1987); “A Test of the Efficiency of a Given Portfolio”(Econometrics, 1989); and “On the Estimation of Beta-Pricing Models,” which was selected as the best paper inthe Review of Financial Studies for 1992.

Shanken has consulted for Morgan Stanley, TreynorArbit Associates, Acadian Asset Management andBARRA.

The recipient of a B.S. degree in mathematics from theState University of New York at Stony Brook, Shankenearned his M.A. degree in mathematics at CornellUniversity, and M.S. and Ph.D. degrees in economics atCarnegie Mellon University.

The Frontier Corporation Professorship

in Business Administration was established

in 1986 as the Rochester Telephone

Corporation Professorship through a gift

from the Rochester Telephone

Corporation.



Ross L. Watts, William H. Meckling Professor of BusinessAdministration, professor of accounting and finance, andPh.D. Program chairman, has been a member of the SimonSchool faculty since 1971.

Watts has research interests in accounting and finance.His recent research includes papers on corporate financial andcompensation policy, top management turnover, lawsuitsagainst audit firms, the internal organization of firms and theaccounting accrual process.

His book, Positive Accounting Theory, co-authored withSimon School Professor Jerold L. Zimmerman, received theAlpha Kappa Psi Foundation Award for Distinguished Serviceand Achievement in Accounting in 1985. In 1979 and 1980,papers by Watts and Zimmerman on that subject received theAmerican Institute of Certified Public Accountants Award forNotable Contribution to the Accounting Literature.

Watts is founding editor with Zimmerman of the Journalof Accounting and Economics, and founding director of theAccounting Research Network which publishes a number ofelectronic journals. He is also a member of the advisoryboard of the Journal of Applied Corporate Finance.

Watts has been a distinguished visiting faculty member atnumerous American Accounting Association and other doc-toral consortia. In 1996, he received the University Award forExcellence in Graduate Teaching for his contribution to theSimon School Ph.D. Program.

A chartered accountant in Australia with six years of expe-rience in public accounting, he frequently presents seminarsoverseas, and he is an honorary professor at the CityUniversity of Hong Kong and at Xiamen University in China.

Watts has been Rochester Telephone CorporationProfessor since 1986.

He holds a B. Com. degree in accounting from theUniversity of Newcastle in Australia and an M.B.A. degreeand a Ph.D. in economics, finance and accounting from theUniversity of Chicago.

The William H. Meckling Professorship is

endowed by contributions from Simon School

faculty, alumni and friends in memory of the late

William H. Meckling, dean emeritus of the Simon

School. Meckling served as dean from 1964 to

1983, and is credited with leading the School

from a small undergraduate institution to a grad-

uate institution of national stature.

The Louise and Henry Epstein Professorship

is endowed by a major contribution from

Henry and Louise Epstein of Rochester, N.Y.

Mr. Epstein, who recently retired as senior

vice president of Staples, a leading national

office products supplier, is a 1980 graduate of

the Simon School Executive Development

Program.

Clifford W. Smith Jr., Louise and Henry Epstein Professorof Business Administration and professor of finance andeconomics, has been a member of the Simon School facul-ty since 1974.

An internationally respected scholar in the fields ofoption pricing, corporate financial policy and financialintermediation, Smith is the author of over 80 articles, 14books and numerous prize-winning papers in his areas ofresearch interest.

Smith is a vice-president of the Financial ManagementAssociation, has served as president of the FinancialManagement Association National Honor Society, theRisk Theory Society and vice president of theInternational Economics and Finance Society. He hasbeen a member of the board of advisors of theInternational Association of Financial Engineers and theboard of directors of the Southern Finance Association.He currently serves in an editorial or advisory capacity fora number of leading journals, including the Journal ofFinancial Economics, Journal of Risk and Insurance,Journal of Derivitives and Journal of Applied CorporateFinance.

Smith has received 26 Superior Teaching Awards fromstudents in the School’s M.B.A. and Executive M.B.A. pro-grams. Frequently cited for his “energetic teaching style,unique ability to communicate the results of scientificresearch into laymen’s terms and application of textbooktheory to real-world management,” Smith was given thefirst Special Award for a Perfect Teaching Rating in 1986.In addition, he was selected from among the University ofRochester faculty as one of 10 University Mentors inrecognition of his scholarship and teaching.

He is a graduate of Emory University with a B.A.degree in economics and the University of North Carolinaat Chapel Hill with a Ph.D. in economics. SB

The faculty of the Simon School is internationally recognized for its pioneering research and effective teaching

methods. Our 53-member, full-time faculty consistently ranks among the country's top 20 as selected by academic

peer review, and among the top 25 by popular surveys, such as those conducted by the Financial Times and U.S.

News & World Report. Faculty members, while still teaching a selection of classes each year, manage a balanced

workload in order to conduct pivotal research projects. It is this harmonious blend of research and teaching that

makes our M.B.A. program one of the most valuable in the country.



For nearly four decades the SimonSchool has provided a superior edu-cation to thousands of students,enabling them to move the frontiersof corporate business practice. Askey players in the global market-place, Simon graduates have beeninstrumental in the evolution of abusiness environment shaped by thecovergence of management andtechnology.

When the results of the 1998Business Week rankings were pub-lished last October, the omission ofthe Simon School from the list oftop-25 business schools led to a rig-orous period of introspection by allmembers of the Simon community. Dean Charles Plosserimmediately began to work with faculty, staff, students andalumni to identify the strategic and operational changes nec-essary to propel the Simon School further into the ranks oftop business schools.

With the help of the student Graduate Business Counciland Simon staff members, last fall Dean Plosser formed six“fast-track”teams which focused on the processes by whichthe School delivers quality service in the areas of admissions,career services, computing, curriculum/teaching, publicaffairs/public relations, and student affairs. The mission ofthese Fast-Track Teams was to “assess the outputs, and theprocesses responsible for delivering the outputs, of a specified

area and bring forward concrete methods for improvingrecruiter and student satisfaction with the specified area.”

Based on the recommendations of the Simon Fast-TrackTeams, the School has implemented a set of broad initiativeswhich are intended to advance its recognition and reputation.These initiatives are described in a special report by DeanPlosser entitled “The Path to Excellence,” which represents areaffirmation of the Simon School’s mission and excellence,strengthened by a significant commitment to enhance thequality of programs and levels of customer satisfaction.

The following section contains a synopsis of “The Path toExcellence.” The full text is available online atwww.simon.rochester.edu.

Simon School to Walk “The Path to Excellence”

Sweeping changes will

enhance the quality of

programs and levels of

customer satisfaction

SPECIAL report


In order to propel the Simon School further into the ranks of the best business schools in the world,the dean created a set of Fast-Track Teams to make recommendations aimed at enhancing customersatisfaction. The teams were comprised of student, faculty and staff representatives, and organizedaround the following areas: Admissions, Career Services, Computing, Curriculum/Teaching, PublicRelations/Public Affairs and Student Affairs.

Based on a broad acceptance of the Teams’ recommendations, the School has implemented a seriesof initiatives intended to enhance the quality of all its programs, outputs and recognition whileremaining committed to the underlying mission, culture and philosophy that distinguish the Schoolfrom its competitors. These initiatives include:

! M.B.A. Program Initiatives ! Faculty Development

! Improvements in Student Services ! Administrative Reorganization

! Strategic Marketing ! New Facilities

M.B.A. Program Initiatives

C U R R I C U L U M R E V I E W

Goal: To enhance the value of the first-year curriculum.

The School has established a faculty committee to continue the discussion of the Fast-Track Team onCurriculum/Teaching and, building on its analysis and recommendations, propose curricularimprovements. Already at work, the committee has broad latitude, but has been asked to considerseveral key areas:

! Enhanced flexibility in the core curriculum.

! Incorporating more hands-on experiences such as projects and opportunities to work directly with business in the curriculum.

! Developing a more systematic means of obtaining feedback about coursework from employers.

! Improving management and performance of teaching assistants.

Implementation Schedule: Initial recommendations implemented in fall 1999; additional recommendations by fall 2000.

The Simon School strives to be one of the very best business

schools in the world and to be recognized as such by our stu-

dents, our corporate customers, and our peer academic institu-

tions and colleagues. As one measure of our success in achiev-

ing these goals, the School expects to be among the top 25

graduate business schools in any broad-based ranking of merit

and seeks to further that standing at every opportunity.

The Path to ExcellenceSPECIAL report


ADMISSIONS AND MARKETING TO PROSPECTIVE STUDENTS

Goal: To strengthen the depth and quality of the applicant pool with particular focus on increasingthe size of the domestic pool by 25 percent over the next three years. In addition, the School seeksto enhance its ability to attract the most talented individuals with high prospects for success.

If the School and its students are to be among the best, then attracting the highest quality studentbody possible to Simon is critical. The following initiatives will be undertaken to improve market-ing to prospective students:

! The creation and advertisement of 10 merit-based Dean’s Scholarship Awards that will provide 100 percent of tuition and will be used to expand the applicant pool and to help attract the very best from that pool.

! The addition of a new associate director for admissions to enhance the recruiting and marketing efforts in admissions.

! The School will also strengthen its efforts to assess the qualifications of its applicants. In particular, the quality of their work experience, English language skills, professional maturity and prospects for success will be carefully evaluated.

! The School will engage the expertise of an enrollment consultant to review its admission strategies as they pertain to domestic applicants.

Implementation Schedule: All initiatives will be implemented in time for next year’s recruiting cycle.

Improvements in Student Services

A number of administrative and process changes are occurring in specific areas and more generallythat are intended to improve the delivery of services to students and recruiters:

C A R E E R S E R V I C E S

Goal: To create a dynamic and customer-oriented Career Services Office with an increased focus onbuilding long-term relationships with students, alumni and corporations. Customer satisfaction lev-els are expected to exceed the 80th percentile in both internal and external surveys.

! National search for new assistant dean for career services, with desirable strengths defined by the Career Services Fast-Track Team.

! Commitment by the School to provide resources (including additional personnel) to make office competitive with those of other top business schools.

Implementation Schedule: A new assistant dean joins the Simon School in September 1999. Budget allocations are in place to support new initiatives and personnel for the next academic year.

C O M P U T I N G S E R V I C E S

Goal: To enhance the service and usability of the Computing Center by improving access, reducingbottlenecks and enhancing the quality and responsiveness of the consulting desk. Customer satisfac-tion levels are expected to exceed the 80th percentile in both internal and external surveys.

! Acting on input from the Computing Fast-Track Team, the Computing Center is implementing new procedures (including training and a greater degree of accountability) for managing the student consultant desk.

! The Student Computer Advisory Committee will be revitalized as a channel of communications between students and the Computing Center.

! A printer will be installed outside the Computer Lab for off-hours access.



! Alternatives to improve remote access will be investigated.

! The number of network connections available in Schlegel Hall will be increased by wiring the Student Commons and basement study rooms.

! Two E-mail-only terminals will be added in the Student Commons.

! Two additional printers and 3-4 PC’s will be added in the Computer Lab.

! The Computing Center will improve network connectivity in the School with more network ports and increased support for students to configure their personal equipment.

! Additional support features should benefit both day and evening students.

Implementation Schedule: Advisory committee meetings are underway; meeting summaries will beposted on the Intranet. New network connections have already been installed. New lab printersalready installed. Consulting Desk software and procedures to be implemented by September 1.Printer outside the Computing Center, new lab computers and E-mail kiosks have been installed.

S T U D E N T A F F A I R S

Goal: To improve the flow of information to students and provide a focal point for channeling stu-dent-related questions to the appropriate party and ensuring that responses are communicated backto students. Customer satisfaction levels are expected to exceed the 80th percentile in both internaland external surveys.

Will clarify and improve communications with students through:

! a new mission statement for the office that accurately reflects its role and responsibilities;

! an Intranet site to convey information about services available through the office, answer frequently-asked questions and facilitate communications with students;

! a regular newsletter relaying useful information about the School, schedules and policies, and cre-ation of feedback measures that assess student satisfaction with office.

Implementation Schedule: All initiatives will be in place by September 1999.


Simon Fast Track Teams

Seated, l to r: Nick Monogenis ’00, ProfessorMichael J. Barclay, MelanieCaoile ’99, John Heckman ’99,Professor Jerold B. Warner,Associate Dean Stacey R. Kole,Assistant Dean Kevin Brennan,Professor Clifford W. Smith Jr.,Kim Hall ’00

Standing, l to r:Professor Shailendra P. Jain,Timothy Attwood ’00, KarenBaker ’99, Ian Horowitz ’00,Professor Phillip J. Lederer(foreground), Andy McClure’99, Daniel Forrester ’99, MarkDanchak ’99, Doug Reid ’99,Ralph Marburger ’99, Director ofStudent Affairs Donna LampenSmith, Professor Thomas F.Cooley, Senior Associate DeanCharles W. Miersch, AssistantDean Pamela A. Black-Colton,Larry Brennan ’99, ChrisPlaczek ’00, Dean Charles I.Plosser, Andrew Lakind ’00

Not pictured:Senior Associate Dean RonaldW. Hansen, Associate DeanRichard M. Popovic, formerAssistant Dean Lee A. Junkans,Professor James A. Brickley,Professor Ludger Hentschel,Professor S. P. Kothari, ProfessorLawrence J. Matteson, PublicAffairs Director George M.Tomczyk, Andrew Belton ’99,Vinay Sharma ’99, RossWaetzman ’99

SPECIAL report


Strategic Marketing

Goal: To review all marketing initiatives and materials used by the Simon School and with the helpof outside consultants recommend an improved strategic marketing plan for the School.

! A Strategic Marketing Task Force, chaired by the dean, will be established. Membership will include key staff involved in marketing all of the School’s programs, as well as selected faculty.

! Task Force will build on the report of the Public Relations/Public Affairs Fast-Track Team.

! Purpose is to develop a more effective and coordinated approach to marketing the Simon School, with primary emphasis on prospective students and corporations

! Task Force will engage an outside integrated marketing firm to review School’s overall marketing effort and recommend improvements.

Implementation Schedule: The Task Force will make its final recommendations by January 2000.

Faculty Development

Goal: To increase the size, breadth and depth of the tenure-track faculty to 48-50 within five years.

! In order to continue to deliver the quality instruction and the innovative research that is part of the Simon School’s mission and its tradition, the School must expand its tenure-track faculty.

! A long-term compensation plan for junior faculty was implemented in 1998-99 to increase the attractiveness of the Simon School as an employer, and to enhance the School’s ability to recruit and retain the most talented young faculty.

Implementation Schedule: This initiative is ongoing. Successful recruiting this year will result in anet addition of five new tenure-track faculty members in 1999-2000.

Administrative Reorganization

Goal: To align, focus and strengthen the administrative structure of the School in a manner that willimprove its ability to deliver the levels of satisfaction and support to students, faculty, alumni andcorporations that are commensurate with a world-class business school.

! The senior managerial structure of the Simon School will be reorganized to align its operations with, and bring more resources to bear on enhancing corporate relationships, program management and faculty development.

! Charles W. Miersch will serve as senior associate dean for corporate relations and institutional advancement, and will have overall responsibility for coordinating and managing all aspects of the School’s interactions with its corporate and alumni constituents.

! Ronald W. Hansen will serve as senior associate dean for faculty and research, and will work to ensure the School’s success in hiring and retaining the strongest faculty possible.

! Stacey R. Kole will serve as associate dean for M.B.A. programs, with primary responsibility for managing the curricular and operational aspects of the full-time and part-time M.B.A. programs.

! Richard M. Popovic, associate dean for executive programs, has primary responsibility for all executive M.B.A. and non-degree programs. He will work closely with the respective senior associate deans and the associate dean for M.B.A. programs on scheduling and teaching assignments, and corporate relations and development.

! Kevin Brennan, assistant dean for information technologies is responsible for all computing support for students, faculty, administration and staff. He will also work closely with the director of public affairs to maximize utilization of the Internet.



S TA F F R E C O G N I T I O N A N D S T U D E N T S AT I S F A C T I O N

As part of the reorganization, it is important to establish a mechanism for rewarding those staffmembers who deliver high levels of student satisfaction. Almost everyone on staff interacts with stu-dents. The School would like to formally recognize those staff members who contribute the mosttoward making the students’ experiences worthwhile and productive.

! School will develop an appropriate method of measuring student appreciation for individual staff members.

! All staff through level of assistant dean will be eligible for cash awards.

! The incentives this new award system creates are important signals to staff of the importance of student satisfaction to their overall job performance, and should help foster an enhanced attitude among the staff toward achieving higher levels of satisfaction.

Implementation Schedule: The new organizational structure and incentive rewards were effective on July 1, 1999.

New Facilities

Goal: To increase the number of classrooms and faculty offices and the space available for studyrooms, career services, executive program management and M.B.A. admissions and administration.

! If the School is to meet the demands of the competitive marketplace in which it operates, it must expand its facilities. The projected cost of this initiative is $3-$5 million.

Implementation Schedule: An aggressive planning and construction schedule is anticipated to havenew facilities ready for fall 2001 classes.

M I S S I O N A N D P H I L O S O P H Y

As the School strives to achieve its goals, it is important to retain the focus that provides the Schoolwith its comparative advantage. The Mission and Philosophy of the School provide that focus andan important summary of the objectives and value-enhancing characteristics of the Simon education.

The mission of the Simon School is to be a recognized leader in the creation and dissemination of anintegrated body of knowledge that has significant impact on managerial education and practice.The School’s educational programs focus on graduating outstanding individuals who are prepared toexcel in a dynamic and internationally competitive marketplace.

C O N C L U S I O N

The initiatives described in this report are a direct result of the hard work and dedication of allmembers of the Fast-Track Teams and they deserve the School’s appreciation and thanks. Theadministration, faculty and staff of the Simon School are deeply committed to an ongoing partner-ship with students and alumni to ensure successful implementation of these initiatives.

SPECIAL report

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“It’s important for government officials torealize that one state taxing the Internet accesshas a domino effect on the Internet economy asa whole,” says Dewan. Reduced revenue for thecontent provider will force it to sacrifice thequality of information they offer or be forced toclose shop. This will reduce the welfare of allcustomers whether they reside in states that taxInternet access or not.

“We have seen similar phenomena withchanges in business focus, increased competitionand taxation in the telecommunication industrywhere reduced tolls and calling charges havebeen accompanied by increased fees for directo-ry information and other information servicesthat were previously free,” says Dewan,“Internet users will see an explosion of contentavailable for a fee that parallels, if not exceeds,the 900 service on the telephone.”

these arising portals, says Dewan. As competi-tion for Web pages to attract advertising dollarsand users heats up, portals must survive by spe-cializing in content and scope. First, portalshead off direct competition by offering differentkinds of information—with content rangingfrom finance to sports. Secondly, portals differin the scope of services offered. Some offer asmorgasbord of services ranging from free E-mail accounts to free hosting of Web pages.These mega-portals have a lot of special andcostly content. In contrast, other small portalsbecome niche players.

“Many believe that the creation of these“Internet superstores” will discourage the cre-ation of new, specialized boutique sites,” Dewansays. “This is untrue because intense competi-tion to post the best information will cause theportals to rely on their smaller Internet neigh-bors for the niche information their users need.”

According to Dewan, portals endorse smallersites by deeming them worthy of a link on theirpage. This creates traffic for the smaller entitywhile helping the portal to position itself as agateway to valuable information. “It’s a two-way street,” says Dewan. “Portals controlwhere users go, but rely heavily on boutiquesites for the information that will keep themcompetitive.”

The rise in the number of portals will serveas a vital part of the Internet economy. “Forty-three percent of all Internet users visit AOL.com,one the most popular portal sites,” says Dewan.“The specialization and simplification of thesesites will be an integral factor in attracting moreconsumers to the Web and helping the Internetbusiness to prosper.”

Portal Kombat

Surfers Beware

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(continued from page 7)

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DSL

CLEC

CableMergers &Acquisitions

E-Commerce

BroadbandSatellite

FCC

W i r e l e s s

ANNUAL SIMON ALUMNI CONFERENCE ’99

TELECOMMUNICATIONS CONFERENCE

W W W . S I M O N . R O C H E S T E R . E D U

Friday, September 24, 1999

Check the Simon Web site at www.simon.rochester.edu for details as they develop or contact Jane Tibbitts at 716-275-9176 or E-mail: [email protected]

TELECOM

Underwritten by a grant from Soyata Computers.

Inherent within the Simon School M.B.A. program are countless opportunities and rewarding chal-

lenges. The full-time M.B.A. Class of 2000, the largest to date, has added to Simon’s vibrant learn-

ing environment through its mix of backgrounds, cultures, professional experiences, and personal

interests and goals. Class members include accomplished athletes, entrepreneurs, professional

dancers, lawyers and even an air traffic controller! Forty-two percent of the full-time M.B.A. Class

of 2000 hail from outside the U.S., representing over 27 different countries. Over 60 percent of stu-

dents are bilingual, with a large number fluent in three or four languages. They have earned under-

graduate degrees at institutions ranging from Colgate University to China’s Fudan University. Such

an enriched class coupled with Simon’s world-class faculty and academic excellence can only spell

success in the new millennium! See the charts below for more information.

Simon’s Class of 2000:

ENDPIECE

Class Characteristics

Enrolled 247

U.S. Minority Students 15%

•African-American 5%•Asian-American 8%•Hispanic-American 2%

International Students 42%

Average Age 28

Age Range 20-46

Countries Represented 27

Undergraduate Institutions 126

Male 78%

Female 22%

Work Experience

New Graduates 4%1 - 2 Years 18% 3 - 4 Years 29%5 - 6 Years 21%7+ Years 28%

Average Years Work Experience 5.0

Undergraduate Majors

Economics 19%Other Social Sciences 11%Humanities 10%Business and Commerce 28%Engineering 21%Math and Science 11%

SB

GMAT Distribution

16% 64% 17%

500-590

600-690

700+

GRE takers 3%

Average GMAT 639

Average TOEFL 625

Undergraduate G.P.A.

Average 3.20Middle 80% 2.9 - 3.6

A rich blend of

cultural diversity

paired with drive

and ambition pre-

pares this class for

the new millennium!


Harry Keefe

Henry A. Kissinger

William W. Lanigan, Esq.

Donald D. Lennox

Jane Maas

Paul W. MacAvoy

Louis L. Massaro

J. Richard Munro

James Piereson

Robert E. Rich Jr.

William D. Ryan

Leonard Schutzman

George J. Sella Jr.

Marilyn R. Seymann

J. Peter Simon

William E. Simon Jr., Esq.

Joel M. Stern

Sir John M. Templeton

Ralph R. Whitney Jr.

Joseph T. Willett

William E. Simon, Chairman

William Balderston III

Charles L. Bartlett

O. T. Berkman Jr.

J. P. Bolduc

Paul A. Brands

Andrew M. Carter

Richard G. Couch

Frank G. Creamer Jr.

Ronald H. Fielding

Barry W. Florescue

George J. Gillespie III, Esq.

James S. Gleason

Robert B. Goergen

Paul S. Goldner

Bruce M. Greenwald

Mark B. Grier

General Alexander M. Haig Jr.

Larry D. Horner

Michael S. Joyce

David T. Kearns

William M. Kearns Jr.

UNIVERSITY OF ROCHESTERR O C H E S T E R , N E W Y O R K 1 4 6 2 7

SW I L L I A M E .

IMONGRADUATE SCHOOLOF BUSINESS ADMINISTRATION

WILLIAM E. SIMON GRADUATE SCHOOL OF BUSINESS ADMINISTRATION

Change Service Requested

Doctoral Fellowshipsin Management

■ Application feewaived for 650GMAT/700 averageGRE (Quant./Verbal)

■ Generous financialsupport

■ Excellent placement atthe nation’s leadingbusiness schools

Deadline for applications

is January 31, 2000, for

Fall 2000 admission

The ProgramThe program is distinguished by its breadth of training and dynamicinterdisciplinary communication among faculty and students. Fields ofspecialization include accounting, applied statistics, computers andinformation systems, finance, information systems economics, macro-economics, marketing, operations management, operations research,and organizations and markets

The FacultyThe 53-member faculty, many of whom are internationally recognized,have a tradition of applying economic and quantitative methodology toa broad range of management issues and problems.

EligibilityCandidates must have a bachelor’s degree, take the GMAT or GRE examand be a U.S. citizen. For a current catalog or further information, call or write to:

Ms. Lynne M. MitchellPh.D. ProgramWilliam E. Simon Graduate School of Business AdministrationUniversity of RochesterRochester, New York 14627

(716) 275-2959

E X E C U T I V E A D V I S O R Y C O M M I T T E E

E-mail: [email protected]

Documents

The coming years will be a ‘Golden Age’