2015

Stories related to "Editor Pick."

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Meet the Dean

Incoming dean Madhav V. Rajan shares his personal story and lays out his vision for Chicago Booth’s future—including the critical role that Booth’s global alumni network plays in building on the school’s successes. Chicago Booth Magazine: You’ve called yourself a “lifelong learner.” Can you take us back and share an anecdote about a moment in your childhood or school years that sparked your interest in business and/or academia? How can Booth instill a similar love for learning in future generations? Dean Rajan: Steve Jobs famously noted that you can only connect the dots looking backward, and that is certainly true in my case. I did not think through or plan out my career. My decision to study business for my undergraduate degree was based purely on the fact that my older brothers were engineers and I wanted to learn something different. I then moved to pursue a master’s degree at Carnegie Mellon University, for the simple reason that my father worked in Pittsburgh. I did well in my first-year courses and was approached by a faculty member, who asked whether I had considered doing a PhD. I had not, but he persuaded me by noting that I would get paid to study, which seemed an amazing concept! This particular professor was in accounting, and that’s how I ended up in that field. However, Carnegie was unique in not having an economics department separate from the business school. Every student in accounting, economics, and finance did virtually the same coursework. Looking back, I have benefited immensely from the breadth of study and interdisciplinary training I received at Carnegie. Even then I wasn’t sure I would become an academic. Many of my PhD friends ended up in consulting, and I always thought the same would happen to me. But I liked academic research and teaching and was successful at it, so when I got a job offer from Wharton, it was an opportunity to keep going. Coming to Booth, I am firmly of the view that the school should support lifelong learning for its alumni. Two years ago, the school launched Back to Booth, which are short, nondegree classes for alumni. These courses provide opportunities to relive the Booth classroom experience with fellow alumni, and to learn about the latest ideas from faculty across the school. I cannot imagine a better way for alumni to keep connected with the school and to continue to learn from our great instructors and the latest ideas they are working on.

perspectives

The Book of Booth: Sinuhe Arroyo, ’11 (EXP-16)

Armed with a PhD in artificial intelligence from the University of Innsbruck, Taiger founder and CEO Sinuhe Arroyo, ’11 (EXP-16), came to Booth to hone his vision of building a global AI business. The result: a company that has offices in five countries and is becoming a global leader in cognitive automation for the financial sector. CBM: What was the genesis of your idea for Taiger? Arroyo: After completing my PhD and my first acquisition, I realized that I wanted to build my own business and play to my strengths. I took some of the research that I had been doing during my PhD and started building a product. In that sense, we are a textbook case of technology transfer from academia to business. Because I had a strong academic background, the transition to run a business was not necessarily easy. However, the Executive MBA Program helped me put the pieces of the puzzle together. You start realizing how you can assemble the business, and everything starts to make sense. You think, “Why is this not working? Why is this like that? Boom, that’s why it’s not working.” And then it just flows. That’s a beautiful feeling. CBM: How did the Executive MBA Program help you acquire new customers? Arroyo: It boils down to building trust and negotiating. I am constantly negotiating with customers, providers, employees, partners, and investors. Professor Lars Stole set the foundations for me to understand and think in pure economic terms with his Microeconomics class. Also, I really enjoyed my Negotiations class with professor Ayelet Fishbach, where all those concepts from Micro come to life. It was very beneficial to understand the different approaches and mechanisms you can use to negotiate. <br/>

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At Home, Abroad

Kendra Mirasol, ’93, had one major goal while growing up in Janesville, Wisconsin. “I remember always wanting to get out,” she said. She studied German in high school and moved across country for college at the University of California, Irvine. During college, Mirasol worked in a hotel in Lindenberg, a small Bavarian mountain town. “They spoke zero English,” she says. “It was so fantastic for exposure learning. You had to sink or swim.” After graduation, in 1989, just before the Berlin Wall fell, Mirasol lived in Kranichfeld, East Germany. She stayed with a pen pal whose family struggled to get by under Communist rule. “They were basket weavers—they got paid $1 per basket.” While attempting to leave the country, she was interrogated at the border for three hours because she forgot to file the correct paperwork at the police station. <br/>“Those are exciting experiences,” said Mirasol, now president of IOR Global Services, a global mobility and talent development solutions company. Without work- and study-abroad programs, she said, “My life would be so boring.” Mirasol came to Chicago Booth to supplement her German literature and language background with business acumen. She was able to maintain a global perspective during her interactions with international students. Mirasol could tell that a good friend of hers from Japan struggled to adapt to the direct, unfiltered mode of classroom discussion favored by some American classmates. “It was so difficult for him to even contribute one idea,” she recalled. “He was probably the smartest man in the school, and when I saw that happening, I felt I had a responsibility to facilitate.” These types of cross-cultural support are needed every day, around the world, on a personal level, and in boardrooms. In April 2016, Mirasol’s passion for international exchange—and for the broader benefits of a global economy—motivated her to accept a volunteer role on the board of directors at the nonprofit Cultural Vistas. <br/>

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How Do You Manage Millennials?

For the rising ranks of millennials in business, 2015 was a watershed year: they surpassed Gen Xers to become the largest generation present in the US labor force. Yet another milestone is on the horizon—Pew Research predicts the 73 million–strong cohort, born between 1981 and 1996, will overtake baby boomers as the country’s largest living adult generation sometime next year. Though millennials are no more or less a monolith than the generations that came before them, many managers have observed that members of this generation are bringing a markedly different set of values to the office than their predecessors. Millennials may be derided as tech-obsessed, approval-seeking job-hoppers, or praised as creative, adaptable idealists, hungry for personal growth. But one thing’s clear: they’re prompting executives across industries to reevaluate the traditional approach to management. We asked three Booth experts what the future holds. William Osborne, ’01 (XP-70), is senior vice president for global manufacturing and quality at Navistar Inc., a Fortune 500 company based in the Chicago area: Millennial employees take a fundamentally different approach to their professional lives, but they’re not the caricatures people make them out to be. They have a different value system regarding the role of work in their lives—work is one component, and not the centerpiece. They value experiences more than what I would call traditional rewards. For example, I just had an employee, an engineer, recently quit the company and move into a completely different position, in purchasing, with another company. It was a fundamental change, and the main reason he gave was that he lived downtown and the new company was downtown. For him, work was a means to support his lifestyle. <br/>This is not necessarily a bad thing. They’re more creative and more innovative—they look at things differently, and that’s what’s driving change. But they’re less willing to compromise personal growth and development for the sake of the corporation. <br/>

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This is Working for Me: Sandra Stark, ’95

Fifteen years ago, Sandra Stark, ’95, went west to Seattle to Starbucks Coffee Company, where she worked with three others in new ventures, a group that behaved like a VC firm: buying Tazo Tea, introducing the Starbucks Card, and looking for other growth opportunities. She wasn’t managing a huge slice of the company’s total $22.4 billion business, as she does these days as a senior vice president managing the global product organization, but it gave her a first glimpse of the fast-growing company’s equitable culture. It’s this culture, she says, that informs “what we do and how we treat people—farmers, suppliers, partners in stores, customers—along the way. It permeates everything we do, it sets the tone, and it helps answer many, many questions. It’s our true north and it’s why I’ve been here 15 years.” A native of Waukesha, Wisconsin, and mother of three tweens, Stark recharges with her kids: skiing and playing tennis and basketball. “I have everything I could wish for in my life. Every single day I think, ‘I am so lucky to have this job.’” Coffee is the heart and soul of our business. Product is my responsibility: beverages, food, merchandise. It starts with coffee and expands from there. What’s the strategy? What’s the right portfolio? What’s the innovation? How are we staying ahead? Currently new to the mix are our Blonde Espresso, made with lightly roasted beans; nitrogen-infused cold brew, which is less acidic and richer tasting; and Teavana Tea Infusions. With merchandise, we’re thinking, what do our customers need to create the right coffee experience at home?

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How Can Humans Work With Artificial Intelligence?

Humans’ fear of robots taking over jobs (or, perhaps, the world) dates back many decades. But there are lots of ways in which AI is already being integrated into the workplace, and the trend will only continue. Yes, AI may take the place of some jobs, but it will also create new jobs—and free up humans to engage in more creative and, well, human tasks. Justin Adams, ’10, is CEO of Digitize.AI in Charlotte, North Carolina: "Most people are familiar with the fact that AI is being used in manufacturing—think robots on an assembly line. But much of AI’s role is service based these days—in health care, for example, which is what my company does. Right now, AI is being used for more of the rote functions, the repeatable and predictable. Humans don’t innately want to do repetitive, rote work, and I think AI will help free people up to do more creative work. My view of AI in the workplace is very positive: I wouldn’t have started an AI company if I didn’t believe that! For instance, my company developed an AI system that can do 50–70 percent of the work hospitals have to do to get preapproval from insurance companies for medical procedures. Currently people are still sending faxes, if you can believe that, or manually entering data online. Because humans are prone to error, and treatment can be delayed because of lack of prior approval, there’s a real patient impact here. Our software can handle approval in the majority of cases, leaving only the more complicated cases that require creativity or negotiations with the insurance company. Humans still have to handle these.

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On a Mission to Send 'Citizen Astronauts' to the Stars

Special people go into space. In 58 years, fewer than 570 astronauts from 37 countries, most of them highly trained scientists and aerospace professionals, have traveled to space, almost entirely through government-backed programs. Soon, probably this year, the Federal Aviation Administration will certify for-profit space travel companies and, according to industry members, special people of a different sort will be able to travel into space at $250,000 each. However, as futurist Buckminster Fuller said, “The Earth is a spaceship,” which means that we are astronauts—all of us, not just the special people. “If we don’t democratize space, it will be the province of the ultrawealthy,” said Ulisses Meneses Ortiz, ’16, director of international affairs at Space for Humanity, a company that intends to be that force for democratization. Space for Humanity will give 10,000 private citizens from around the world all-expenses-paid trips to space so that they can be ambassadors for space exploration and help solve some of Earth’s most intractable problems. Space for Humanity sees itself as an education provider rather than a space travel transportation provider. The company will place passengers on spacecraft manufactured and launched by others, partnering with all available providers to allow for the greatest diversity in spaceflights. Its travelers will receive leadership training before they blast off and mentoring after they return. Would-be passengers must have a reason beyond the “way cool” motivation for wanting to go. Of the 100 or so applicants to date, almost all have terrestrial projects they want to tackle when they come back.

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To Your Health

The Challenge: In the early 2000s, a 50 percent failure rate for mental-health-drug trials meant the Food and Drug Administration approved few new treatments for psychiatric diseases, says Amy Fershko Ellis, ’80, who cofounded MedAvante in 2002 to analyze how the pharmaceutical industry tested psychiatric drugs. Her team found the root cause of trial failure was measurement variability and investigator bias in subjective assessments of trial participants. MedAvante created a holistic methodology to improve testing, but the company encountered industry resistance as outsiders looking to change the way clinical trials had long been conducted. The Strategy: Ellis applied universal principles to product development. Because drug trials are conducted in various parts of the country and around the world, companies pay investigators to find, evaluate, and enroll patients. But differences between investigators result in unreliable outcomes. MedAvante, however, proposed a way to control and centralize the evaluation process, using the internet to connect remote clinicians to patients to ask the same questions in the same way and characterize patient responses identically. MedAvante also digitized the process and made it cloud based, so researchers would have instant results. To build credibility, MedAvante enlisted key medical and scientific leaders who believed in their strategy and concept—mostly academics who didn’t have an economic bias. In 2005, MedAvante’s first two trials involved drugs that had previously failed. The new methodology showed significant results demonstrating the drugs worked, and the treatments were approved. Even with those results, industry skepticism of MedAvante’s nontraditional approach meant slow methodology adoption. But by 2009 the psychiatry industry embraced the system, and MedAvante dropped the 50 percent trial failure rate to the low teens. In 2014, MedAvante expanded the platform for use in all medical drug trials, using new technology to enhance data quality for drug developers. New services were quickly adopted beyond psychiatry, especially in studies of Alzheimer’s disease, where the company now holds a leadership position. “We benefited from the halo we had from our success,” Ellis said. The Takeaway: A great strategy can work in all sectors, even if implemented by industry outsiders. If the strategy and results are sound, don’t be discouraged by naysayers.

perspectives

The Book of Booth: Roxanne Martino, ’88

Roxanne Martino, ’88, landed her first job in finance after just a quarter and a half in the Evening MBA Program and hasn’t looked back since. The retired president and CEO of Aurora Investment Management and current managing partner of OceanM19 is an inaugural inductee in the InvestHedge Hall of Fame, and the first woman to co-chair the Council on Chicago Booth. You joined Aurora in 1990, just before the hedge fund industry took off globally alongside the rise of the internet. What was it like to be an entrepreneur at that time? It was thrilling. In the early years, we had a “creeping vine” approach to expanding our investor base—one happy investor telling another. That changed once people could search performance metrics online, and could then find us from all over the world. One of our first international clients was from Saudi Arabia. They contacted us after screening on performance data in an online database and requested firm information. We managed their capital for over 15 years. At the same time, hedge fund managers were becoming more global in their approaches. It truly became a global business on both the trading and investment sides, as well as among our clients and investors. How have career prospects changed for women in finance since then? When I went to my first hedge fund investment conference there were only about five women there—we kept in touch and, happily, most of them stayed in the business. While there are more women in finance today than there were then, there still aren’t enough women in leadership positions and on investment committees. To enable more women to attain leadership positions, they must first be hired into investment firms to get the required experience. We must all be vigilant because discrimination is often subtle. When interviewing candidates, make sure that the ratio of women is appropriate and you’re inviting women candidates to the second and third level of interviews. There are very few women CEOs period and even fewer in finance, so I try to make myself available to speak at conferences and women’s groups to assist women in finance in whatever way that I am able to help them.<br/>