American Dominance And Its Effect on Business Management

Looking through my traffic results, I see there is renewed interest in the school rankings for Online MBAs. That tells me it’s time to get back to work and prepare the 2012 list, but it also reminds me to discuss the importance of such schools. Obviously, people go to school to earn degrees that make them more desirable to employers, for better positions and higher pay, but the decision should also be made in recognition of becoming much more effective at our work.

I’ve been reading George Friedman’s work, “The Next 100 Years”, which includes his opinion that the United States will dominate the century, not only because of our military and geopolitical standing, but also because of our business. That’s important for us, because it means that even if you want to become effective in international business, you have to first master the fundamentals of American business. The Master of Business Administration (MBA) degree, therefore, is not just a key to senior management posts, but is also a critical tool in helping your business gain long-term competitive advantage.

So, how does American dominance translate to your own career? First off, consider that (using Friedman’s data) the U.S. has about 4 percent of the world’s population, but creates 26 percent of all good and services, and 26 percent of the world’s GDP. The U.S. is far and away the world’s largest country for industrial production, is still one of the world’s largest energy producers, and is under-populated by global standards. Friedman says that an economy consists of land, labor, and capital, and on all three counts the U.S. is in very strong condition.

Now, it is true that the credit rating of the United States took a hit last year; as I work with credit analysis in my job, this is a point which must be counted with a lot of weight. But in context, always in context. The credit rating downgrade came from the behavior of the federal government, not the nation as a whole. When President Obama said the U.S. was and would always be a “triple-A” nation, he was correct – but he was also ducking the abysmal lack of responsibility by the federal government. The impact of the credit downgrade, then, comes in two parts. First, no matter how well an individual business is run, that business will be subject to penalties and disadvantages according to how it’s home country runs its policies and pays its own debts. That is tied to the second part; whenever a government messes up, the people will have to pay for the repairs and clean-up, and usually governments do this by punishing corporations, on the lie that penalizing large businesses which employ many people will somehow spare people the cost. History proves rather the opposite, but few politicians will ever admit this, especially since so few politicians have actually worked in or run a private-sector business. In short, success will always be desirable but great success will certainly make you a target for government powers seeking to get someone else to pay for their own blunders. As a result, major corporations will of necessity have to staff their teams with tax professionals able to address the sometimes ridiculous demands from government. This in no means that a company should evade taxes or seek to avoid paying an appropriate amount. In addition to the fact that government tax authorities have vast resources to pursue and punish cheats, the history of business also shows that paying too little also brings a cost in brand recognition and loss of goodwill. The point, though, is that paying too much in taxes does not improve the brand or make customers like you better; quite the opposite. Paying too much in taxes invariably forces a company to raise its prices, harming competitive advantage, and paying too much in taxes just makes your executives look stupid. Also, I should not need to mention that the government is far from eager to refund overpaid taxes, especially when a company does not realize its error.

Coming back to our own focus of interest, managers exist to get things done. Knowing that many companies are multi-national now, the globalization question is pertinent, but also must be folded into the acknowledgement of American dominance. By that I mean the understanding that American business practices are generally accepted worldwide as a standard, to the point that many elite businessmen come to U.S. universities and send their children here to learn business management. It means that Codes of Conduct and Mission Statements will generally have an American flavor to them, even in China and Russia, Brazil and India. It means that the exemplars of business excellence will continue to have names like Exxon Mobil, Kraft, and AT&T. Part of it comes from the long history of American business success, part from the dominance of U.S. business school doctrine, and part from the sheer optimism and energy of American strategy. For the foreseeable future, if you want to succeed globally, think American.

So how to do so as a manager? There are a lot of companies with poor management, for simple but foolish reasons. One example is the practice dubbed the Peter Principle, which promotes people who do a given job to a level above it, until they reach a level they cannot handle. The obvious correction for that is to peer-review managers and include regular training and refreshers for each tier of authority. Another common problem is allowing managers to build silos, preventing cooperation and also denying employees advancement opportunities through other departments and shutting down critical feedback for fear of losing image to executives. The correction there is a more active HR presence, especially by creating career paths for employees to encourage development and moral investment in the company future. Also, managers can help themselves by making sure their staff have access to opportunities. Rather than hurting the manager’s position, acting as mentor and providing support for promotion helps the manager nurture relationships outside his own group and department, not only be helping employees advance in the company, but also providing a talent resource for other managers. In this way the company thrives, inter-department cooperation is excellent, employees see proof of career opportunity and the manager who makes it happen gains trust and support from his team. A manager exists to make things work, and to do so more effectively. Sometimes that means seeking efficiency, but more often it means you need a leader with practical experience who knows from his own work what will and will not produce the desired results. Therefore, the goal should be to seek finding such people as managers, and to be such people ourselves.

Rating The Distance MBA

It’s been a couple years since I posted my ranking of the Top 25 Online MBA Schools, so I am having another look at business schools which offer the Online MBA, where most or all of the coursework necessary to earn a Masters degree in Business Administration. That is, now that I have completed my MBA from the University of Houston at Victoria, I am looking at the degree from the other side of the road and considering what it means to earn an MBA, to earn an online MBA, what sort of path should be chosen for different career conditions, and if you do decide to go after an online MBA, which schools are the best choice.

Not everyone should pursue an MBA, and not everyone who should earn an MBA will find the online course the best path to success. There are basically three ways to earn an MBA; full-time, part-time, or online. If your goal in life is to become the CEO or COO or a Fortune 500 corporation, a lot of people will tell you that you need to graduate from a top school, which in the case of the MBA means attending a prestigious and expensive school with a huge reputation, and you have to do it as a full-time student. Of course, doing so is no guarantee that you will win that much-desired CEO spot; work out the statistics and you will find that well over 90 percent of graduates of even the most prestigious business schools never end up as CEOs of major corporations. Have a look at the people in those roles and you will not only find people who did not go to the “top” schools, but some who never earned an MBA and a few who never even earned a college degree at all (you can do that if you found and build your own successful company). On the other hand, most top executives do earn MBAs, and most of them go to well-known universities as full-time students. So if you put in the time and expense to get accepted to a prestigious school as a full-time student, work yourself silly getting top grades, you should expect to have the best prospects in general of all the MBA graduates. That is, if you have the means to get into a top school, if you can afford to go to school full-time and not have to raise a family or work full-time, if you’re still in your early twenties, and if the economy doesn’t make that student loan a killer six months after you graduate. For a lot of working people, one or more of those conditions is not feasible. And for those people, other options need to be considered. If you’re not going to Harvard or the Wharton School or something along those lines, all you really need from your school is a name that will be recognizable, an education worth the time and money you put into it, and a whole lot of work on your part. In my case, I decided to go after the MBA when I was 45, with a family and a full-time job in management. The only possible way I could do it would be to get an online degree. That’s how I chose the University of Houston at Victoria.

UHV is part of the University of Houston system (duh), but not all UH campuses are created equal. Short version, the main campus and Downtown campus have all the students they want, so there is no pressure for those schools to offer online classes. The Victoria campus is another story; it’s far enough out there that the online students make a significant difference in the enrollment size and the school wanted the best faculty they could get, which could only be justified by having a decent number of students. Two things besides the convenience of UHV’s classes I liked were the low tuition and the AACSB accreditation of UHV. The school name is no embarrassment, and I earned my MBA without going into debt.

Now, I have to mention something very important about an online MBA. If the school is any good, the MBA will be just as hard to earn online as it would be any other way. While you can turn in assignments and go to the online library whenever you want, you still have deadlines, the standards and grade requirements are the same as face-to-face classes, and the participation is much stricter than face-to-face. After all, in a face-to-face class you can sometimes hide out in the back and avoid discussions when you are not prepared, but in an online class every comment you make (or the lack of meaningful discussion) is on the record, and a professor can easily tally up just how much you really did to advance the discussion. Also, professors talk with each other, and online students who are exceptionally good or bad will be known to the faculty just as well as those who attend class in person.

The online MBA, then, is for the most part the same as any other MBA, except that you will have to be organized and self-motivated to get the work done, the school will in most cases be a more common public school (most accredited private schools do not offer online degrees) which means your results will depend more on your resume and personal work history than how glamorous your school name is, and if you have planned it right you can get your MBA without a nervous breakdown or a second mortgage. In my opinion, the online MBA will become more popular and common as it works out well for students, universities, and businesses.

The next article on this topic will examine the AACSB-accredited business schools which offer online MBAs, and the 2009 ranking of the Top 25 schools for an Online MBA.

Designing the Case Competition

There is a risk in being trendy, to do something simply because others are doing it. In the matter of business schools, case competitions have become trendy, which means that in some cases the school does it without fully understanding the purpose or how to get the best results. The first order of business for any school whether they are considering creating a case competition or already run a competition, is to decide why you are doing it and what goals you want to achieve. The majority of schools performing case competitions seem to be doing a sloppy job of it.

After looking through the available information on case competitions, there appear to be three main types of competitions – intramural competitions between teams finishing their MBA studies, league competitions between schools, and open tournaments with sponsors and press events. The goals for each type of tournament are different, although it should be noted that there is no rule that a school cannot work to have all three types of competition.

The intramural competition is generally done as a capstone course for the BBA or MBA candidates, and as such focuses on grading their accumulated knowledge, skills and work on a project level. The key stakeholders for this level of tournament are the students, the faculty, judges, and the school’s dean and trustees. The optimal organization structure would plan for participant and judge orientation, along with modest logistical requirements. Goals and objectives for each group would be planned and published in advance, as well as the method for publishing results and feedback. In the ideal situation, the following sample schedule might be used:

December: Guidelines for the competition are published on the school website, focusing on real-world conditions and objectives rather than superficial. Judges are invited and given orientation reports, students sign up for the classes, the focus company is advised of the competition and invited to participate with observers.

January: Capstone classes begin, requirements and rubrics for the competition are included in the syllabus.

March: Individual work completes in each class, teams form up and begin

late April: non-tournament grading is completed, teams submit final documents for project

May, week of competition: Judges meet and are refreshed about company orientation and tournament objectives, and are presented with the project documents for the teams they will be judging. Company is forwarded recommended project papers through its observers or by mail if no observers.

Competition day: Teams present their cases as scheduled, to teams of judges familiar with both the focus company’s objectives and requirements, and the specific analysis and recommendations from the teams’ reports. Judging can take place, therefore, on the basis of how well the team has done its analysis, made effective recommendations, and sells the recommendations to the judges. Scoring on the basis of the rubrics published in December.

May, post-competition: Class grades, written evaluations and feedback from judges and awards, including individual honors, are formally presented. Participants are also asked for feedback about their experience and suggestions for improving the process. This feedback is reviewed twice, at the time of submission and again in planning for the next competition.

I leave it to the reader to decide how well this format would serve, and how well present competitions are planned and managed.

The interschool and sponsored competitions would be similar in form to the intramural event, except that the focus is on school competition as well as the teams. Also, given the higher profile a press element is to be expected, and this should be encouraged so as to produce goodwill and prestige for the schools involved. This is the academic equivalent of varsity sports, with direct and significant effect on the businesses which will hire these BBA and MBA candidates when they graduate. Again, I leave it to the reader to consider the potential for case competitions between schools and tournaments with corporate sponsors, and to consider the success of present efforts. I merely submit here that the process is new and undeveloped enough, that those schools which best plan and promote such competitions will make a name for themselves as stand-out schools with commensurate gains in reputation and enrollment. Despite calling this part 4 of 4, I will have more to say on case competitions.

What A Case Competition Should Be – Part 3 of 4

The case competition is the flagship of a business school’s curriculum, where if the candidates live up to their promise and ability, and if the program is properly administered, the school, students, and the business world in general all gain from the experience. Unfortunately, there is a real risk that the competition will fail in at least one major respect, and miss the accomplishment of its potential. Strategic and tactical planning and execution are paramount, not only for the competing teams but also for the school and even the judges.

Let’s stop here and consider what the case competition means to each stakeholder. For the students competing, at one level it represents a grade in a capstone course, a chance at some personal glory and just maybe the right kind of attention from a potential employer. It certainly never hurts to be able to boast on your resume that you beat out other teams for a tournament win. But the tournament is also important for the school, and properly done for business as well. While some business schools make their name on the strength of their alumni and the renown of the overall school, case competitions have allowed some schools to demonstrate excellence in comparison with other schools in head-to-head academic tournaments. Developing a top-notch case competition format, therefore, is a way for even a small school of modest resources to set itself apart and above its rivals. As for business, consider if you were a CEO of one of the companies chosen for a competition focus. You might very well take interest in the recommendations of several teams of MBA candidates, especially given that the advice is free and thorough. One obvious step I would recommend for any school sponsoring a case competition, is to submit the winning cases to the focus company. There would be no obligation, and the potential for goodwill and a future sponsorship is well worth the effort.

All of these results presuppose, however, that the final product of the teams, especially the winners, will be something the school and the MBA candidates are proud to stand behind. To that end, style must be reduced significantly in importance, and the actual substance of the analysis and recommendations must be much more strongly emphasized, taught, and rewarded. The teams, faculty, and sponsors must be clear about what is desired, how it will be judged, and feedback during case preparation and after the presentations must be clear, ongoing, and complete.

Problems in Case Competition – Part 2 of 4

In my first post, I noted that the case competition was developed as a practical test of the skills expected from MBA candidates, which is why the competition is so often used in capstone courses at the end of a course regimen for the Bachelor’s and Master’s degree in Business Administration. I also noted, however, that the common practice in such competitions is to give too much weight to style and far too little attention to the actual research, analysis, and recommendations.

To show what I mean, below is a sample of the presentation rubric used this Spring in the UHV MBA Case Competition:

Presentation Rubric

Organization:
1. Audience cannot understand presentation because there is no logical sequence of information.
2. Audience has difficulty following presentation because some of the information is not in logical sequence.
3. Team presents information in logical sequence which audience can follow.
4. Material is presented in logical interesting sequence the audience can easily follow.

Subject Knowledge
1. Team does not have grasp of case and cannot answer questions.
2. Team is uncomfortable with case and can only answer simple questions.
3. Team is at ease with case and can answer all questions, but fails to provide elaboration.
4. Team demonstrates knowledge of an array of business models, answering all questions completely.

Issue(s) Clearly Defined
1. No issues are clearly defined or do not fit the analysis.
2. The issue(s) discussed are poorly defined and insignificant.
3. The issue(s) discussed are either poorly defined or not clearly significant.
4. Team has identified strategically significant and well defined issue(s).

Recommendation Quality
1. Recommendations are weak or vague and do not address the issue defined.
2. Recommendations are fair or not clearly explained or do not thoroughly address the issue defined.
3. Recommendations are good but may not be clearly explained or may not thoroughly address the issue defined.
4. The recommendations presented are logical well presented, thoroughly explained and fit the strategic issue(s) well.

Business Analysis
1. The quality of analysis is poor, incomplete and may apply the wrong models.
2. The quality of analysis is fair, may be incomplete or may misapply the models.
3. The quality of analysis is good, the models applied well, but one or more unit of analysis may detract.
4. The quality of the analysis is excellent. The industry, firm and its issues are well articulated

Audience Interaction
1. Team members just stand in one spot and read presentation with no eye contact or use of appropriate gestures.
2. Team members primarily read presentation and occasionally move around, use eye contact, and use appropriate gestures.
3. Team members maintain eye contact, move around, and use appropriate gestures while often referring to notes.
4. Team members maintain eye contact and seldom refer to notes.


At first glance, this rubric appears to be a solid way to evaluate a case performance. It’s divided into Organization, Subject Knowledge, Issues Definition, Quality of Recommendation, Business Analysis, and Audience Interaction in equal measures. When examined more closely, however, flaws become evident.

Let’s start with the biggest problem; judges’ familiarity with the material. The Case Competition at UHV used a panel of six judges for each room, three faculty members and three panelists from prior winning teams. It quickly became apparent as the presentation went along, that the judges were not given any special orientation about the target company, PetSmart Inc. This is critical to the judges’ participation in the competition, as our team prepared for questions relevant to to the specific company’s situation. The pet supply and services industry is far different from the nominal retail environment, and PetSmart was genuinely unique in its business strategy, particularly CEO Philip Francis’ repeated insistence that the company sharply reduce capital expenditures. From discussions with other teams after the event, I discovered that the winning teams all proposed actions which involved significant risk and capital commitment, in direct contradiction to PetSmart’s known focus and corporate vision. That is, if any of these teams had tried their recommendations on the real board of directors at PetSmart, they would have been shot down in short order. I don’t mind losing to a better team, but I do have to say it’s annoying to see recommendations win that my team rejected because we knew they were unrealistic, but the judges did not recognize the context of the target company. It also demonstrates a weakness in the competition, if teams are encouraged to produce a flashy but unrealistic presentation. There is no way to effectively judge substance, if the judges are not made aware of what is on or off the mark. If the actual company’s strategy and vision are not incorporated into the competition, the whole thing devolves to no more than a drama contest, the business version of ‘American Idol’. This is supposed to be business school, not show business.

Let’s also look more closely at those scoring categories. The case competition was meant to be loosely connected to the course grading itself, from the description on the school website. Consequently, organization, the issue definition and the business analysis would already have been developed over the course of the semester; it would be a strange team indeed that did not earn most of the possible points in those areas. The only real distinction would come from how well the judges believed your team delivered its message in those areas – on style. The two most important areas of substance, Subject Knowledge and Recommendation Quality, as we have seen, were diluted to purely subjective impact because the judges were unaware of the target company’s actual strategy and parameters.

That’s not to begrudge the winners their prizes, nor dwell too much on the errors in UHV’s competition. The case competition at UH-Victoria is a great way to finish the course to the Strategic MBA, and the winning teams worked hard and deserve their glory. But it illustrates how even a great idea can fail in execution, and the best correction begins with recognizing those errors and discussing alternatives and opportunities. Also, from looking around at the various competitions out there, it occurs to me that a really well-done competition could set a school above the rest for quality.

The most prominent competitions are those which involve multiple schools, have at least one corporate sponsor, and not only recognize teams for excellence but also outstanding individual performance. My next post will present an outline for such a competition, a new addition that will raise the profile of the school which organizes it.

The Evolution of the Case Competition, Part One

Business Schools do not always get much respect from other schools in a university. Partly because of the relatively short history of business schools (just a few decades, where many classic schools can boast 150 years or more), but also because the worth of a business degree remains in some debate. Of course, a reasonable person could challenge the real value of certain liberal arts degrees, but I shall leave that be for here. The problem really gets going at the graduate level, and of course I mean the Masters degree in Business Administration, the infamous MBA. For many people, the MBA is a pretentious degree acquired by people who can’t do real work. In reality, the MBA is a necessary credential for many business professionals, especially those who want to work in the C-suite someday. But like all degrees, not all MBAs are equal or indicative of a competent professional. Most of the value of any degree depends on the individual, of course, but the school plays an integral role in helping the student reach their full potential and prepare for the real world of business.

The MBA therefore was always meant to be a practical degree, designed to produce a professional able to gather data, analyze it critically, and produce a cogent set of recommendations to improve effectiveness and profitability. Law schools also produce graduates who are expected to put their degree to practical use, and for that reason law school present various trial exercises called moot court. Some of them are quite entertaining and there are various competitions between law schools. The business schools decided to follow suit, and created case competitions.

There are a variety of case competitions available. The most common by far are intramural events held at graduate and undergraduate schools of business as part of the capstone course, meant to test and exhibit the whole spectrum of abilities and skills by BBA and MBA candidates. But there are also inter-school, national, and international competitions, as well as competitions sponsored by corporations or organized by special-interest groups. Some schools have had case competitions for more than a decade, while others are just getting started.

The case competition, generally, takes either a situation or a company, and directs the teams to provide answers, either in the form of a business plan, operational strategy, or a specific recommendation for one aspect of the company (such as a human resource, finance, accounting, or logistics challenge). Teams are judged by a panel which considers their prepared documents, the flow of their presentation and the quality of the team’s analysis, supporting evidence and recommendations, and how well the team answers questions and challenges to their recommendations. Done properly, a case competition gives graduates a good sense of their acumen and presentation ability, qualities they will need in the real world.

That said, I have been looking into the grade weights of a number of competitions, and the manner in which judges are recruited/selected for the competitions, and I have found some weak areas. For instance, in case competitions the overwhelming weight of points come from the way the case is presented, rather than the strength of analysis and recommendations. This becomes significant when one considers the effect of sending competition winners out into the work world convinced that style is more important than substance, something we have seen all too often in failed leadership at more than a few companies. The second problem is that judges, all too often, treat the competition as a minor event requiring little preparation on their part, so that they miss errors in analysis and recommendation that would be disastrous in a real-world situation. Again, what is needed is a way to not only reward one aspect of the presentation, but also critically challenge the teams so they have a good idea what they need to do to be ready for real-world situations.

In my next post, I will examine ways that the case competition device may evolve into a more effective teaching tool for creating effective business solutions.

When the “B” in MBA Does Not Stand for ‘Business’

I have just completed my course of study in earning my Master of Business Administration degree. While the official grades will not be released until May 22 and the actual degree will not be mailed until the end of June, I have finished all the coursework and will finish at UHV with a GPA of 3.94. More to the point, I have had the pleasure of working with a broad range of faculty and students. And while I am generally proud of my fellow graduates and respect the talents and hard work of our faculty, I also understand why Scott Adams has been making fun of MBA holders this week.

Sadly, there are quite a few MBA candidates and graduates who really do not understand what the degree is for, and who are frankly going to cause harm to the company they join and damage the school’s reputation by association, because their focus is on their own advantage, rather than in seeking to improve their company through hard work . I am appalled to see that so many people think that the MBA is a lever for their own advancement, rather than a tool to be used to find solutions and improve performance. That is, the MBA holder does not solve problems and find solutions simply by being on the scene, he or she should understand that the courses and resources provided in the MBA curriculum are meant to provide tools that the individual may use to find the answers and solutions needed in their work, and that while they may hope for personal reward and advancement, the proper focus is on service, not ego.

Another problem is the unprepared MBA holder, someone who has the degree but does not know how to properly use it. I discovered a sad example of this at the MBA Case Competition, where the majority of teams proposed recommendations which were actually in conflict with PetSmart’s clearly stated goals and objectives. In a real-world situation, a consulting group which is unaware of the corporate strategy of its client is going to go out of business very soon. In this case the individuals may have the best intentions, but failing to base recommendations on the company’s actual condition and needs is well below a professional standard.

My father warned me many years ago against being impressed by lofty degrees, While he himself held a Masters degree in Mathematics, as well as Bachelors degrees in Chemical, Electrical, and Mechanical Engineering, he made it a point never to boast about it or give the impression that he was smarter than other people. At the same time, he was never impressed by people in high office or who attached proud initials after their name, be it ‘PhD’, ‘MD’, ‘JD’, what have you. He always seemed to me to take after John Adams in that respect, a man who truly understood the character of republican democracy in practice. That may seem a non-seqitur in this discussion, except that many people fall into the habit of assuming that a grand title or high-sounding designation makes a person more capable than ordinary folks. That’s not to disparage the value of an MBA, I agree it implies a degree of work and ability, but at the same time no MBA makes a person immune to mistakes, and foolishness from a self-important person can be much worse than the same nonsense from someone more willing to admit he could be wrong.

Preparing Business Professionals

My team did not win the Spring 2009 MBA Conference at UHV. I am not writing this out of bitterness, I think, but clarity and full disclosure before the rest of this article. That is, the reader should know about any reason I have for bias. This article examines the practice and assumptions of the Case Competition at UHV, and suggests improvements.

The Master of Business Administration degree (MBA) is a unique academic credential. Academic degrees verify that the student has demonstrated knowledge and comprehension of a subject material to the degree required by his college, but the MBA also certifies practical ability; the MBA holder has been authenticated as a problem-solver and business leader, a person capable of making his employer stronger and more successful. The degree was designed for the real world, not merely the one in theory. Consequently, the MBA course of study ought to include a capstone course which tests the candidates’ ability to address real-world strategic decisions.

The University of Houston system has fortunately grown up with an ingrained need to prove itself. The Houston metropolitan area offers many opportunities for college and university experience; institutions in the area include Rice University, Houston Baptist University, St. Thomas University, the University of Texas Medical Branch (UTMB), the Baylor College of Medicine, Houston Community College, Prairie View A&M, Texas Southern University, Texas Woman’s University, Tomball College, Lady of the Lake University, Sam Houston State University, a number of for-profit schools like the University of Phoenix or DeVry, and of course the University of Houston. But that’s not all. UH also has had to compete with major players at the state and regional level for attracting top students, like the University of Texas and Texas A&M. The University of Houston has done well for itself over the last few decades, especially the Bauer School of Business. UH has established itself as a solid business school, recognized for excellence in its MBA programs.

Of course, UH-Victoria cannot claim quite the same prestige as UH’s main business school, although its faculty is shared to some degree. However, UHV’s growth strategy over the past half-decade reflects an ambitious set of goals, including the school’s accreditation as a member of the AACSB, its expansion from a two-year school focusing largely on graduate students to a four-year university with dormitory space and a full-scale staff for a complete range of academic studies, and the development of three major MBA programs in six fields of concentration. UHV is well on its way to becoming a force to reckoned with among business schools in Texas. The key focus for UHV, however, is to be aware of its relative newness, which can work to its advantage or represent a threat to the school’s success. And that is where the Case Competition comes into the story.

The Strategic MBA is UH-Victoria’s mainstream MBA plan (the other programs are the Global MBA for international business, and the ‘bridge’ MBA for BBA students who want to fast-track to their MBA as well). The Strategic MBA requires a capstone course called Strategic Management. That course is designed to test the MBA candidates’ knowledge from the courses they have taken in their time at UHV, combining the knowledge and experience from class and work to research, analyze, and make strategic recommendations for a real-world company. This project is done in stages, both individually and in teams, and culminates in a formal presentation to a panel of judges at a case competition held at the end of the semester. The top three teams as voted by the judges are recognized with certificates and permanent citation on a school plaque. Since the MBA program does not recognize cum laude, magna cum laude, or summa cum laude accolades, nor is there an official class ranking for graduate students, winning the case competition is one of few ways for a student at this level to stand out. The other notable honor is selection to Gamma Beta Sigma, the business school honor society.

Having said so much to get to this point, I will try to focus on the key points from here on in to the matter. Our target company this semester was PetSmart, the leader in the Pet Supplies and Services industry. Our team did well in all aspects of our research and analysis, and our recommendations not only were effective and practical, but were also well in alignment with the strategic vision of the CEO and leadership team. Once we completed our research and analysis of the industry and company, its focus and issues were easy to determine. For example, the following points became obvious:

[] The pet supply and services industry has been growing at a faster pace each year than PetSmart
[] With the exception of long-term store leases, PetSmart has effectively no long-term debt
[] CEO Philip Francis has emphasized the reduction of capital expenditures each year, and has announced his intent that no more than 4 percent of gross revenue should be spent on any capital project, including new store openings, the reformatting of stores to emphasize services, and any additional promotions or projects
[] PetSmart maintains relatively large liquidity for its industry (33.6% of assets are current)

The combined effect of these observations means that PetSmart is very risk-averse, and the leadership team has repeatedly emphasized their intention to avoid expensive capital projects. Accordingly, any realistic recommendation to the PetSmart board would have to be paid from current expenses, and be incremental in nature to avoid significant risk. Keep that in mind, it becomes important in a little while.

My team also focused on PetSmart’s “worry list”, a 32-item list in the Annual Report which identified, in order, the top concerns for the company. Without going into too much detail here, those worries focused on the revenue from new stores, on growth for services offered at PetSmart stores, on retention and effective training of key employees, and on better control of the supply chain. This directly led to our team’s four recommendations:

1. Perform site surveys and use specific demographic data to determine specific sites for new store locations;
2. Promote services using a national campaign and the Petperks card;
3. Create the role of ‘PetStar’, for experienced and motivated employees with growth potential;
4. Expand supply lines to include local brands recommended by managers and requested by customers

What made us confident that we had a winning position, was that the recommendations neatly dove-tailed with the company’s stated goals and priorities, and were in perfect alignment with the issues identified through the analysis. We saw tremendously profitable projects, low-cost and low-risk, which could be incrementally put into practice, all of which addressed the key areas of PetSmart’s directors’ focus and aligned with the company’s vision.

The exposition of our recommendations went well, though it had a few hitches. First off, some of our team were uncomfortable with public speaking, and this diminished our presentation a bit, and also in the Q&A session. While our data was perfect and our recommendations better than anyone else’s (wait for it), this imbalance of presentation certainly cost us points. We also had a problem with one of the six panelists, a judge who all but demanded we pay for our projects with capital expenditures, even though we had determined early on that such an action was not only unnecessary for our projects, but in opposition to the clear intent of PetSmart’s directors. At the time we thought that judge’s resistance to current expense was strange, but it later revealed a more serious problem with the process.

We had to wait a week to find out the results, and even then the announcement was oddly subdued. It showed up on a school blog Friday evening, and eventually found its way to the SOBA website by Monday. As of yet, none of the teams have been told their scores, provided any detailed feedback from judges, or learned – officially anyway – what won the competition for the three recognized teams. Despite hard work which received a 99% grade from the professor for the overall project, my team did not place. There has been no announcement of how the eleven teams which did not win scored, so there is no official word on where anyone placed who was not one of the winners. All in all, a strange way to conclude the business, although both the class professor and the school’s dean had promised useful feedback from the judges. It remains to be seen what actual details will be made available to the contestants.

I have to be honest and admit that I believed my team should have taken one of the top slots, especially after we discussed the competition with members from other teams. While a comprehensive review is not possible unless the school decides to release the details from the judges’ notes and the competing teams’ presentations, informal chats with other students revealed that the chief basis for points in the competition was style far more than substance. The reason lies in two factors; the rubric used for scoring the presentation and the judges’ preparation for the competition. The rubric had six sections, with scores from 1 to 4 in each section, so each judge assigned a score ranging from 6 to 24 for each team, and with six judges that creates a range of 36-144 points total possible for a team. So far, easy to follow. A copy of the rubric can be found here.

Looking more closely at the rubric, certain additional information comes to light. For example, given the fact that the teams would have worked all semester on the project, it is unreasonable to me to imagine that any of the teams would fall into the ‘1’ grade for any of the sections except ‘audience response’, nor do I believe that even there would all of the judges be so harsh on the teams. With regard to the “Issues Definition” and “Business Analysis”, I do not even believe that any of the teams would fail to score anything but 3’s and 4’s in those areas from the judges. What this does is place heavy emphasis on the recommendations, organization, and audience response, with the strongest factor in play being style rather than function. That is, people who could speak well would have the advantage over those who were less relaxed and smooth, even if the smooth talkers presented impractical recommendations and the less relaxed team were perfect in their analysis and recommendations. The first mistake made was in constructing a rubric which counted the practicality of the recommendations to a lesser degree than the style of presentation. I certainly recognize the value of presenting your case well, but a solid recommendation presented with some rough spots should definitely be scored more highly than an unrealistic recommendation presented with flair. Otherwise, the results would be as absurd as scoring a math test on the basis of flourishes and calligraphy, discounting whether the answer is even correct. I will come back to this crucial point.

Second, the judges had not been fully briefed on PetSmart’s corporate strategy or vision. They were unaware that the company is very risk-averse, and so their board of directors would be resistant to any proposal involving increased capital expense, long-term commitment (such as buying out a rival or supplier) or significant deviation from the vision laid out by Philip Francis in 2003. The emphasis of the project was that teams would make proposals as if to the board at PetSmart, so the character and tenor of the actual board is integral to the validity of recommendations made, and the judges’ response to them. In the case competition, all of the winners made recommendations which – speaking bluntly – the real PetSmart board would have rejected because of their risk, heavy financial commitment and capital expense, that is, the need to take on debt in order to finance the projects anathema to PetSmart’s stated objectives and goals. That the judges did not challenge these recommendations for their variance from PetSmart’s position is bad enough; that these recommendations were rewarded as the best demonstrates a far more troubling consequence of the competition’s structure.

I said the need to make valid recommendations was crucial, and it is very much so. The MBA is certification that the individual, whether an employee or a consultant, is qualified to perform effective research and analysis and make recommendations which will improve a company’s strategic position and performance. This can only happen when the individual properly understands the company’s range of options, its corporate strategy and primary goals. The case competition is the final episode in the capstone course of the program of MBA certification; beyond that point the student receives their diploma and moves on to the real world, where reality is far less forgiving of an invalid recommendation, no matter how well it is delivered. The glib, the trendy, these things must have no place in the mind or focus of the true professional, and so it is the worst sort of consequence to penalize valid recommendations and reward invalid projects, no matter how polished. It may seem inconsequential, that a competition was decided more by judges’ moods and their subjective reaction to style than by the actual corporate strategy of the target company and the functional relevance of the specific recommendations, but this is an area where there is much work to be done. In future years, it would be very much to UHV’s advantage to make sure the judges were properly briefed on the nature of the target company, that actual business executives were included in the panels rather than just faculty and prior case winners, and that feedback both to and from the participating teams in the weeks following the competition should be much broader and detailed than the present practice. At the very least, the school could rest assured that their case winners would be properly equipped for the real world challenges they face so soon after graduation, and that their competition was as realistic as humanly possible to create.

Case Competition Lessons

UHV finally released their winners of the Case Competition last night, and my team failed to place. Bit disappointing, that. That led me to some thought and analysis of our performance, and today’s post examines what I considered.

First off, congratulations to the winners. While Dr. Salazar told me that he thought our team had a “very good chance of winning”, that does not mean that we were the only team that worked hard and produced a strong result. Since the case competition counts as the final exam in the capstone course of the Strategic MBA program, it should be obvious that all of the competing teams will do their very best to produce a quality presentation. Those teams which won did do through a lot of work and some solid execution, which is the essence of the course.

Second, I admit to some doubts when I found out my team did not win. Did we make some major blunder that we never caught? Were we blind to some critical flaw? The answer to that comes not only from Dr. Salazar’s pre-conference praise that we were in a good position to win, but also from the 99% grade we received for the project. 99 percent is nearly perfect, and an A in the course (which I received and assumed everyone in my team received) is not handed out to someone who makes big mistakes. We simply were beaten out by better performance, but our own work was very good. I use that phrase, because several of the judges said that, precisely, after we finished our presentation last Saturday. I have to believe the judges meant what they said, so while we did not win I also believe we did well.

So how did we not win? At this point I have to admit I am competitive, and I wanted to believe we would win, as my team needed that confidence in itself. Looking back, that was probably our biggest problem area. We started as a four person team and added a fifth member whose own team fell apart close to the end of the semester. This meant coordinating five people to give the presentation, and trying to get everyone comfortable with speaking before the judges, which was a big issue. Three members of our team were not at all comfortable in public speaking, and that hurt us two ways. The rubric used for grading the presentation had six areas, for which teams could be issued a grade of 1 through 4 from the judges, for a range of 6 to 24 total, and with six panelists that meant a total score ranging from 36 to 144. I hope we will get back the detailed notes from the judges, so I can confirm what I am guessing now, but one of those six sections addressed the comfort level of the presenters, and looking back we certainly lost points there. Another section of the grading addressed the way questions from the judges were answered, and the way that three of our members hung back also had to have cost us.

I also think the room assignment hurt us. Four rooms were used for the competition, with different judges in each room. Two of the three winning teams presented in the same room, and our room produced none of the winning teams. This is important because two of the judges appeared to be far more critical of us than the others were. I could not sit in the room while other teams gave their presentation, but I could look in from the back window and those judges remained stern and hard-nosed for those other groups. At the time I believed this would not hurt us, since the judges were showing the same attitude towards each team, but I did not consider that judges in other rooms might have a different overall tone, and I suspect that was part of the situation. The life lesson there is that you do not always get a level playing field.

Beyond that, I’d have to see the judges’ notes to know what they might have thought beyond their comments, which were positive and complimentary. While the Q&A lasted the full 25 minutes, judges were generally pleased with our responses, nodding their heads and in most cases smiling when we provided answers. We had no ‘deer in the headlights’ moments where we could not answer a question, and I believe we defended our recommendations well. The only certain problem area was that almost all the talking in the Q&A was done by two members from our team, and that surely cost us.

On the whole, the competition was fun and a great experience, although UHV still has a lot of work to do to get it where it needs to be. We were originally told that the results would be announced Wednesday, then Friday, then I only found out through doing an Internet search on the key words; the school gave the winners less press than they did to the Swine Flu update, and that’s wrong. Also, it remains to be seen how the teams will receive feedback; since the course comes right before the graduation of many students, I suspect that many will never read the judges’ notes, and that is a failure of the school in my opinion – this is a tremendous opportunity missed. Also, the school is still a bit disorganized in the competition format. If asked, I could make a number of suggestions on how they could make this a much more successful enterprise, though I would surely have more clout if my team had won the thing.

Oh well.

Post-Conference Thoughts

It’s been six days since the UHV Spring 2009 MBA Conference in Cinco Ranch, and we still are waiting for the winner announcements. I have been promised we will know today. The delay comes from the fact that grades have to be released prior to the announcement of winners, which makes sense on one level but is nonetheless a bit disappointing on another level. The case competition counts as the final exam for the capstone course, so it makes sense that the grade matters. On the other hand, the competition is separate from the course itself (per the Dean of the Business School), and the effect of the competition is a bit diluted to delay the results, especially since in past years the winners were announced the same day as the competition. I’m afraid that the delay will encourage participants to leave once they have given their presentation, rather than meet with other teams at the event and experience the competition for all its potential. We were given feedback forms the day of the competition, but I think it would be smart for the university to follow-up about two weeks following the case competition for the perspective from that distance.

My team got 99% for its project grade, which means we missed a perfect job but so far we have not seen the detailed feedback from the panel judges, nor in fact do I know for sure where we lost our point (though I have a guess or two). Hard to say if that point cost us the win.

The format for the competition itself was interesting. Over the course of the semester, we each produced three individual versions of a paper analyzing the pet supply and services industry and a company analysis of PetSmart, Inc. (the focus company assigned for the project). We then put our individual reports together to create a team report, which was eventually refined into the final report for the project. Our paper was 122 pages of text and charts, with another 9 pages of sources listed.

This paper was then distilled into a PowerPoint presentation, which in our case took 39 slides, and this in turn caused a problem for us. The heart of the presentation was the team’s set of recommendations, which is usually two or three but in our case four strategic actions. The reason the length was a problem, was because we would have 25 minutes to present our case, giving us less than 39 seconds per slide to make our case, and some of those slides would require a bit of talk to make them clear. So we faced the problem of speaking clearly and in detail, covering more than one slide a minute but without rushing. So we spent some time rehearsing and working out the tricky timing.

The other half of the presentation was the question and answer session. At the start of the semester, we expected to present our case to a panel of three judges. At the end of the semester, we saw that panel count climb to four. Accordingly, we printed and bound four copies of our presentation for the judges. When we walked into the room for the presentation, however, we found six judges waiting for us. Fortunately, they were willing to share with each other. The other big thing about having six judges, was that the question-and-answer session following our presentation was detailed and deep. We spent the full twenty-five minutes allotted for that session answering questions from the judges, everything from our reasoning behind our recommendations, to their cost, scope, payback, and so on.

It’s a little difficult to explain how hard the question-and-answer session is. On the one hand, a team should be able to anticipate most of the questions by examining their case critically, with team members role-playing skeptical judges to find places where questions would rise, but on the other almost half an hour or straight verbal questions from six different people, and meant to be answered by different team members, creates a bit of uncertainty on its own. Add to that the fact that no team can really practice for the spontaneity of panel questioning, and you have a situation that can be tense and throw you off your rhythm. Of course, it makes you feel better to consider that every team faces the same obstacles.

More to come.

Case Competition 2 – Business Intel

This Saturday, my team will be competing in the UH-Victoria MBA Case Competition. It’s the culmination of the Strategic Management course, which is itself the capstone course of the program. Fourteen teams will be competing, presenting the results of fifteen weeks of research, analysis, and developed recommendations for company strategy. Along the way, our team has learned and reinforced some interesting lessons about the business world and people in general.

This semester’s target company is PetSmart, Inc., the leader for the pet product and services industry in the United States. I will be posting the results of the competition, and details of our analysis and recommendations on Stolen Thunder after the competition is over, but for now I want to note that the company was remarkable for its combination of smart moves and missed opportunities, of keen insights and odd missteps. This is generally because like all companies, PetSmart is made up of its people and is the combination of their talents, efforts, and inspiration. In their specific case, most of PetSmart’s strategic decisions reflect the fact that all of the senior management were hand-picked by CEO Philip Francis. When you do that, you get a group which is loyal, almost always in agreement, and committed to the CEO’s strategy, but you also lose the perspective of differing opinions and the chance to test assumptions, or in PetSmart’s case especially, the follow-through to make sure your strategy is fully effective. PetSmart is generally in good shape and is being run pretty well, but even so my team found several areas where the company could maximize its advantage or avoid potentially critical problems – and in most cases these opportunities seemed obvious to us from the company and industry environment and resources available.

Sometimes it comes from a proprietary way of thinking, a desire to make sure that a company keeps control of its plans and operations, so that open discussion is lost in the interest of protecting company strategy. Other times, though, it’s an unfortunate exercise of human pique, of refusing to consider alternatives or suggestions in the misguided belief that no additional perspective is needed or useful. And that attitude is mighty common. What amazes me after studying business at the macro level for a couple years, is not that some businesses get into trouble, but that every business will sooner or later face a crisis that was largely avoidable, or miss an opportunity that could have significantly improved its financial health. This does not happen through lack of ability, but is the result of strategic choices made but not revisited.

People outside business often imagine that they understand the theory and practice of high-level corporate strategy, or at least they believe the talking heads in government and the media who tell them that they understand business better than people with decades of industry experience and top-level education in the field. This is just one reason why Op-Eds and government plans are generally not able to effectively resolve business strategy problems; they are making assumptions and jumping to conclusions. This of course would give the reader pause when considering my own column, as this would reasonably challenge my own statements and judgments, which brings me to my general recommendation for businessmen and anyone interested in financial health, whether for an individual, a company, or for the nation. Use your own mind and experience in making decisions, but it’s generally important to consider as many relevant contributions as you can find. The common factor in the situations at GM, Chrysler, AIG, Merrill Lynch, and so many other companies which have run into serious trouble of late, is an insular culture that self-promotes, increasing confidence in its own strategies but ignoring potentially vital warning signs and alternatives that a simple Deming loop process could have provided. Come to that, such behavior is all too common, and the results from such assumptions all but unavoidable.

Case Competition

If you read my blog regularly, you know that lately I have been posting IR-regularly. That’s largely due to a few things at work, and the case competition at UHV. That competition concludes this Saturday, just three days from today. I will be writing about that competition and its results, so I may be even less relevant than usual for some people. If you are interested in the MBA process, however, or have an interest in the case competition process, this might be worth a read.

The Masters of Business Administration (MBA) is different from most Masters degree programs, in that the MBA is intended to be a functional, real-world degree. So, rather than write up and defend a treatise in front of an academic panel, many business schools demand that MBA candidates demonstrate their knowledge and accumulated resources in a practical application of their combined skills. The case competition is an ideal way for this exhibition to be performed. At UHV, the capstone course for the “Strategic MBA” is called “Strategic Management”, and that course culminates in the case competition. The competition is open only to MBA students who have completed all or almost all of the other courses necessary for graduation, and is judged by a panel of professors from the business school, and senior officers from businesses interested in participating. The specific business officers who take part as judges is a carefully guarded secret, but it offers an additional appeal to the competing teams – performing well in the competition could not only produce a good grade in the final course, but also possibly lead to interest from a major company. Hey, the plaque is nice but who doesn’t like to improve their career profile?

The course itself is a bit sneaky, if you are not careful to pay attention. For instance, the capstone course eats up a lot of time and resources, so it’s not advisable to take the course at the same time as more than one other course. I noticed that about 15 students have dropped the course this semester, from the original group of 70. Also, the course at UHV is offered in three sections, and you choose your team from students in your own section, forming a team during the first days of the class. Careless or slow selection can be a critical mistake!

The course this semester covered 104 days, or just short of 15 weeks. Of that time, the first individual report was not due until February 21, almost a month into the semester. The second individual report was not due until March 14, and the third individual report was due March 24, representing a gradual increase in pace. The group’s first report was due April 4, the second April 18, the group’s final presentation was due May 2 and the group final paper was due May 3. The competition itself, of course, is May 9. So, the first paper was due on day 27, the second on day 48, the third on day 58, the fourth on day 69, the fifth on day 83, the sixth on day 97, the seventh on day 98, and the case competition takes place on day 105. When added to the regular course requirements of assignments and quizzes, this means that the pace increases as you approach the deadline, which is similar to real-world conditions for many companies.

There are four formal phases to the competition – first each student prepares individual analyses of the target company’s industry and the company itself. This semester the target company is PetSmart, Inc. the industry leader based in Phoenix, Arizona. The first paper examines the industry, the second refines that analysis and adds the company analysis, and the third refines the industry and company analysis and produces and issue statement – that is, a point or points on which the company needs to address a critical problem or can take advantage of a unique opportunity. The second phase comes up at that point, where the teams each meet and discuss their individual results, and reach consensus on a group opinion of these analyses and issues. The team’s first paper then presents analysis of the industry and company, in much greater depth than the individual reports, and also includes the first exhibition of the group’s recommendations. For comparison, my third individual paper was 67 pages while my group’s first paper was over a hundred pages, with ten pages of single-spaced source citations. The group’s second and third paper refine and defend the paper and recommendations; our final work was 131 pages long. We worked hard not only to cover all the bases, but also to cut out extraneous material, which is to say 131 pages was the lean version of our work. The third phase is development of the PowerPoint presentation. Since we would be presenting that work in the span of 25 minutes allotted to us, it became important to have enough slides to present the full picture of the industry, company, and recommendations, but also avoid to many words and clutter, and to be sure we finished on time but without rushing. The key there is to present relevant charts and figures, but stay away from text except where absolutely necessary. It also means a lot of discussion and rehearsal.

The fourth phase is the question and answer session, which immediately follows the presentation. This is what trips up a lot of teams, who work hard on their paper and delivery, but who do not prepare for likely questions. These questions cannot all be predicted ahead of time, but generally they are based on justifying the recommendations, explaining their selection and implementation and defending their cost and payoff.

There is, I think, a fifth and sixth phase that most students do not notice. The fifth phase is that you should communicate with your team early on – the professor mentioned from the start that you could work cooperatively with your team while producing your individual analyses, as long as your work was your own. That is, it’s OK to discuss your opinions from your analysis with your team, and develop an early consensus on some points (although with my team, it led us to examine assumptions and reconsider initial analyses), but you have to do your work and defend your conclusions with hard numbers and support. My group had several phone conferences and meetings, and well over five hundred postings on a private discussion board set up by the professor for the teams. And of course there is also the sixth phase, where you find a thread running through the industry, company, issues, and your recommendations tying everything together. Your recommendations will be strong if they make sense on every level, including alignment with the company’s leadership and direction. If you find yourself selling recommendations which are in conflict with industry conditions or the company’s present business strategy, you will have to explain to the judges why it is necessary for the company to abandon its present course.

At this time, all of the participating groups have submitted their final presentations and papers, and so all that is left is the actual competition, which means giving our presentations before the judges and answering questions. Of the initial 18 teams, 4 dropped out from students quitting the class, and it looks like three teams took in an additional member from one of the teams which dissolved, which is what our team did, so that we now have five members rather than the standard four. This has problems and advantages. Problems, because a late addition to your team can be disruptive and make roles unclear, but also advantages, because if you add a strong individual you can end up with a stronger team. We were fortunate in that respect, because the student who joined our team has strong marketing skills and is better than the rest of us at graphics. So, we are breaking up our presentation five ways rather than four, and we have all been working on our parts to be clear and confident.

More after the competition.

The Distance MBA – Revisiting the Decision

Spring is the season of new beginnings and renewal, and that includes consideration of continuing education. High school juniors begin to plan for college, high school seniors eagerly (or anxiously) wait for word from the school of their choice, and many adults examine the merits of going after a degree or an advanced degree. I noticed that a fair number of my readers here when I post articles on the MBA degree get here by way of a search engine that hit on the letters ‘MBA’, and no wonder – there is basically an urban myth that earning yourself an MBA is the ticket to a solid job with good money. So I have to start by shooting that meme down.

An MBA, no matter where you receive yours, does not guarantee you anything. You might be able to parley the degree and school name into an interview for a position, but if the company is even half what it should be, you will still have to prove your credentials to win the job, let alone keep it and succeed in the company. Getting your MBA is not the focus you should have, nor should you get too proud or worried about your school – you should focus on earning your MBA, as in learning, claiming, and installing the tools that a good program offers for the students willing to do the work and grow in skills and maturity. Consequently, anyone earning an MBA should, when considering the school, focus on what tools and opportunity for development that school offers. Take a look at the backgrounds of the biggest crooks and failures in business, and you will see that some of them went to top-reputation schools, while some of the sharpest and most savvy businessmen do not always come from Stanford, Wharton, or Kellogg.

Full disclosure here; I am finishing up my degree at the University of Houston – Victoria, and I chose that school for reasons that suited my case better than they might suit someone else. I like the school and would certainly recommend the prospective student give UHV a look, but even so my first recommendation is to know what it is that you need. It would be impossible to list everything, but as an example students just finishing their bachelor’s have little real-world business experience, and so need a program which offers interneship opportunities and brings in lecturers who run their own business, while students pursuing their MBA after working in management will want to find programs which offer tools they do not already have; in my case I wanted more work in marketing strategy, as that is an area where my resume was relatively weak. I needed a school that was not excessive in cost or difficulty; raising a family and working a full-time management job meant that a distance degree might be the most suitable vector for my studies. That said, I did some research and found that for business schools, the AACSB accreditation is critically important. The AACSB is the Association to Advance Collegiate Schools of Business, an international accrediting body that focuses on management and accounting schools. Founded in 1916, the AACSB is the most recognized body which distinguishes first-rate business and accounting schools; schools like theHarvard Business School and Rice and the University of Texas (and UHV) are accredited by the AACSB; schools like the University of Phoenix and Kaplan are not. This does not mean that every AACSB school is the same in stature, but I would recommend against earning an MBA at a school which is not an AACSB member.

There are three chief differences between the traditional on-campus schools and distance curriculums. First, let’s be clear that there is a lot of prejudice out there – there are companies which judge education by whether the school is prominent, especially for higher-level positions. There is a kind of cowardice in such thinking, the notion that simply going to a certain school produces a more qualified candidate, and such thinking – like all prejudice – demonstrates a weakness in the target company’s organizational mindset, but you’d better understand that such thinking does exist, and many students go to obscenely expensive schools in the hope that they can mke that factor work for them. While choosing your school on the basis of what it can actually teach you, and performing your own cost-benefit analysis in that decision, means that you will miss the chance to join some of these companies, it should be recognized that you probably would be miserable working at a company where thinking was so hide-bound that where you went to school somehow limited your abilities as a manager or accountant; I speak with some experience here, and such companies do odd things like imagine that working inflexible M-F 8-5 hours and requiring a full suit at all times were necessary ingredients for success in business. Claiming the tools and honing the skills that make you as effective as possible in your work will not only make you more marketable in the long term, they also lead to a great deal more satisfaction in your career.

The second difference of note between the on-campus and distance schools, is the way you take your classes. In an on-campus class, you show up for the class when scheduled, take notes and participate in live discussion, complete and turn in your assignments when due and take tests in person. For the online class, you take tests and complete assignments, but your attendance is virtual, which some people take to mean something easier than attending a physical class. First off, just like an on-campus class, you will sometimes need to log in at a certain time for a lecture or seminar. But what’s more, you can’t just hide in the back of the room when you’re unprepared for an online class, the way you can in a campus classroom; the system notes not only how many times you answer questions or comment in a discussion, it also records the actual answer or comment, so its quality and context are there for everyone, including the professor, to see. Online class discussions therefore tend to be more substantive and relevant to the subject matter and instructional themes than the more traditional classes. Similarly, an online exam may require security measures to prevent cheating or misuse of resources, but physical separation of students from each other and the presence of a proctor work to create better security than some campus examinations can boast. And just in case someone has it in mind to try to get around the security in an online class, don’t forget that in the end the class is designed to teach tools and develop critical thinking skills that you will want to call upon when you are a working professional years later. Think long-term, and apply every opportunity to developing ways to be your best in every respect. In the online class, that means a lot of reading, a need to be very self-disciplined, especially in time management, and to thoroughly follow-up on every chance to answer questions or dig a little deeper than you have to to set yourself apart from the ordinary student.

The third way in which distance learning is different, is the cost in money and time. Now again, I have to be blunt – there are various levels of schools you can go to, and the value of your degree will depend on how well that school suits your abilities and goals. If you have it in mind to become a Fortune 500 CEO within ten years of getting your MBA, the only schools worth considering that can help you in any real sense will be those mentioned in publications like BusinessWeek, Forbes, or the Princeton Review. You will spend upwards of a quarter-million dollars, and even then you get no guarantee that the degree will be worth what it costs you. Before anyone dives into such a program, however, I would recommend they consider their personal profile. In my own case, for example, UHV was a much more appropriate choice because of my work history and my bachelor’s degree from Baylor. That is, my profile is solid but not a top-tier CEO, while on the other hand my previous degree gave me some school recognotion, so that my first need in an MBA program was one which was AACSB-accredited, offered real-world applicability, and was cost-effective. I would frankly recommend students take courses at schools which have physical campuses; this allows you a way to take face-to-face courses when that is more appropriate to the subject matter, it avoids the apparent stigma of the online-only schools, and it raises the profile of the school in the nominal opinion.

The MBA in Modern Business

As I near the completion of my MBA studies, I am naturally interested in my prospects to make something of my accomplishment, besides the opportunity to cover my wall with some tasteful calligraphy. The news of late – say for the last year or so – has been increasingly dismal, especially for those about to graduate from school. I’ve been fortunate in that regard, since I have a job right now, but I do admit that it bothers me to think that all my work to earn an MBA might not result in any substantive improvement in my career profile. Then again, a few initials on a resume do not change the person carrying them. At best, they open the door to discussions with people who might be interested in the person who accomplished the degree. I have to say that some of the people in my class who are about to graduate with me, are not worth an interview in my opinion for any important position. This is because while they have collected the degree, they have neglected to incorporate the tools that make the salient difference in their qualifications to lead employees. This is sadly too common; far too many managers seem to think that management is about giving orders to someone else, who then is expected to do the real work. Such people are corporate vampires and they kill businesses. Obviously, a good interviewer should be able to screen them out and keep them far away from any position involving decision-making or course-setting. I have not only applied for many positions in my life, I have also done a lot of the hiring and interviewing, and I would say that overall, the ratio of qualified applicants to unqualified contenders is about 1 in 4. With higher-profile positions, that ratio becomes more acute, so that executive positions are likely to attract a candidate pool that is at least 95% unsuitable.
A lot of my classmates are, to be blunt, coasting as they see graduation approaching, and they do not understand that they need to make themselves valuable to the companies they wish to impress. The suit and the crisp paper for the resume are details, not the substance. The first mission of the MBA graduate is to make himself valuable for a company that agrees to take him aboard, then to work constantly to improve that value for the company. In short, be worth more than you cost, and exceed expectations as you progress in the company. This not only is what the company expects when they hire someone with an MBA, it’s also the best way to improve your profile for promotion. This should be obvious to everyone, yet sadly I see over and over again that many would-be executives place their personal responsibility and commitment to go beyond expectations as low priorities.
I made one ‘B’ my first semester at UHV, the same semester when I had emergency surgery and was diagnosed with cancer. Even so, I was disappointed in that ‘B’, and I worked hard to make sure everything since then was an ‘A’. My initial 3.66 GPA for the first semester has steadily climbed to 3.93 as I earned nothing but A’s. This was not because it would matter to anyone but me; so far as I know there are no rewards for a high GPA beyond knowing you met the grade. But I have made sure to learn every concept and acquire every tool that was possible, so that when I leave with my MBA I will be much more capable as a manager. That, when everything is said and done, is the value of a Masters in Business Administration, no matter the time or place.

The Case Competition

This post may not interest that many people, but I am enjoying this final stretch of my MBA pursuit. The Strategic MBA at the University of Houston – Victoria culminates in a capstone course which includes a case competition. As you might expect, I mean for my team to win that competition.

There are basically three reasons why I want to win the MBA Case Competition. First, the practical point – there is no ‘Dean’s List’ for MBA candidates, we do not graduate cum laude, magna cum laude, or summa cum laude, and while a strong GPA is nice, no employer really cares about it; since the necessary GPA to graduate is 3.0 or better, everyone should have a nice result for their efforts (mine so far is 3.933, if I get A’s in both classes this spring I can finish with a GPA of 3.9412). The only way to stand out in the graduating class of MBAs, is to place in the competition.

The second reason is personal motivation. I think I am one of the smartest and hardest-working students at UHV, so I’d better do my best to show that in my results. Besides, who doesn’t want to finish strong? And third, you never know when you need to look for work, and adding honors to your resume is always a good idea.

The competition, for good and bad, is relatively simple. Each 4-person team will prepare a paper for the target company, in our case PetSmart. We started working last month on the project, so everyone will have three full months to get their project show-ready. Of course, that lets the slackers catch up so our team will just have to be better in depth and in quality of analysis. That’s the second major part; the presentation. A lot of folks won’t rehearse enough, or will assume that their paper is enough to work on. Fact is, however, a good presentation may use the same data, but selling it to judges (or in real life, clients and superiors) means preparing the information to be easy to understand and compellingly persuasive. And of course, we can’t forget the Question and Answer session after the presentation, which can make all the difference between a good team and a winner.

Since it’s such a big deal for me, I will be writing more about the case competition this Spring. Hope it’s worth the read!

Value of an MBA Part 3 – Business Needs MBA People

The recession and various related crises have scared a lot of businesses into kneejerk reactions, including production slowdowns and layoffs. That’s not to say these actions may not be necessary in some places, but in too many places these actions are not considered in the context of their need and effect, but as automatic measures. As a result, many companies are allowing themselves to be tossed about by events, out of control with relation to their environment. In far too many situations, companies allow themselves to lose revenue and miss opportunities for sales and growth, which could have been gained through effective management. Those management skills can best be found through acquisition of experienced managers with MBAs.

Frankly, if you earn an MBA you need to be picky about where you work. From my experience, at least half of those businesses which have 1,000 employees or more do not know how to make the best use of their MBA-caliber people. Instead, they rely on policy and formula, which has the advantages of clarity and consistency, but which discourages innovation and recognition of ability. While many of these companies will be glad to hire people who have earned MBAs, it is a bad career choice to take such as post, since you will be locked into a set routine that would not allow you to use all of your tools and ability. The person who earns an MBA should seek a company which not only offers a good salary and position, but which will make use of the full skill set of its MBA class.

How do you find such companies? A good MBA student can actually do this without too much trouble. One of the requirements of any decent MBA curriculum is regular production of research and analysis for all the different classes. Find the industry you want, narrow it down to the region and other particulars which suit your desired work conditions, then that should work it down to sets of private and public companies you would consider. For the public companies, look at the last three annual reports, especially the Management Analysis and Discussion, and see how they make use of their people. Look at trade journals and see who gets mentioned – if you only hear about the chief officers at a public company, that is a sign they are not paying attention or giving credit to their working talent, the phrase I use to describe the people who have experience and ability, but who are all too often neglected by the executives. What you want to see, is buzz about the performers who are making things happen, and you want to see evidence of innovation and development of their opportunities.

In considering private companies, information is harder to find but if you look at the local level, you will still find indicators. Media will discuss companies which are leaders in their industry, which is an indication that they are making good use of their management, and even though they do not release audited financials, there will also be financial data available through trade journals and you can pick up buzz through anecdotal discussions with people in the area.

The point for here, though, is that earning an MBA produces a specific skill set, one which only some companies will make effective use of, and so the candidate seeking a career position must do the same dedicated research in choosing a target company as he or she does in his classwork.

Value of an MBA, or Continuing Education as a Career Boost pt 2

Yesterday, I noted that earning an advanced degree may or may not be worth the time, cost, and effort. Sadly, I believe that some of my fellow students will soon be disappointed when they discover the limits of their new degrees. That said, those who have planned ahead may find the degree will be well worth the investment.

It’s a fact too often missed, that to bring in the big money you have to give the company good reason to believe that you will produce commensurately higher revenue for the company, thus justifying your high price tag. Therefore, you do not just need to be good enough to do the job, you need to be so good that the people considering you feel that they must have you. An MBA can play an important role in that campaign, provided you learn the things you need to be able to reflect in your resume and interviews, and provided you learn from your studies where you are weakest and strongest.

When I first began my MBA efforts, I mentioned that there are basically two roads you can travel; getting into the best school to which you are accepted, or the best school you can afford, in terms of time as well as money. This decision is critical. In my case, I chose the second course because of my experience and prior education. My Bachelor’s degree is from Baylor University, well known for academic excellence. If not a top-tier school, Baylor is certainly known internationally as a school with solid credentials. Further, I decided to go after an MBA to complement 23 years of work experience, which both limits my ceiling and establishes a floor of positional ability. A top-tier school, say the Chicago School of Business or Stanford, would not be a good fit for me because my resume will not make a top CEO position possible for me. That’s not defeatism; almost no one is truly qualified to be a Fortune 500 CEO, including about one-third of those people who actually became such executives. What I mean, is that an effective job search starts with understanding what you can and should target. A lot of frustration people get in hunting, is that they chase some jobs that they either could not get, or for which they are not a good fit. In my case, my experience is sufficient to apply for a mid-level management position, and the MBA improves the profile both for the management position and in promising executive potential for anyone bringing me on board. That is, multiple talents and a proven track record. The kid with no experience, for him a solid internship would be critical. The MBA buys you a ticket to a lower floor in that case, but if it’s a solid school and you do a job that gets you noticed for the right reasons, it can lead to a fast track that the more experienced managers do not get to experience. On the other hand, a more experienced manager gets work contact sooner with upper management, and if that is done well it can lead to opportunities that the kids won’t see for years.

Worth of an MBA

With the recession likely to be aggravated by the policies of the Obama administration, many people are naturally concerned about not only their jobs, but their long-term prospects as well. Some have asked me, since I am finishing up my work to earn my MBA, what the reason was for earning that degree, and whether I would recommend it for someone trying to move up in a company or improve their income and job security. The answer, like so many times, is ‘that depends …’

MBA, of course, stands for Master of Business Administration, a title which may seem vague to some but which can represent a great deal. The reason that the degree may or may not worth what it takes to earn it, is that you have to do more to use it properly than just have it on your resume. The MBA is an advanced degree, and in most conditions it is expected to be an indicator of advanced position and a complement to advanced experience. If you are just starting out in the world of employment, or if your resume does not already reflect management experience, then the degree will be less valuable as a lever to gain a desirable position. That’s not to say that an MBA does not help you in finding a management position, but in general it is most appreciated when accompanied by evidence that you have done this before.

Inexperienced candidates compensate for that problem in two ways; acceptance to a premier school, or internship at a prominent firm. The problem there, however, is that you are still starting at a relatively low level in the company. Of course, the flip side is also true, that if you go to a less-prominent school but have experience you will be considered for a higher position, but with weaker long-term prospects initially. Or not, depending on the company and how well you do your job. The MBA, then, is a tool, but like all tools you must choose according to what you need to get done what you want.

to be continued