McCombs School of Business
     

Briefs

Students See Money in Manure

An MBA student plan for a business that converts organic material into natural gas used to power environmentally friendly energy systems was named the winner of the 2002 fall MOOT CORP® competition.

As the winners, Organic Energy Systems receives a year’s free occupancy in the Austin Technology Incubator and the $100,000 grand prize. At press time, Organic Energy Systems was polishing its business plan presentation for the International MOOT CORP Competition, held at the McCombs School in May. A win there would garner them another $100,000 in seed money.

“This competition is a launch pad for new ventures,” said Dr. Gary Cadenhead, the competition’s director. “The team will use the $100,000 grand prize as an early stage bridge loan, keeping the venture afloat until it can raise a more substantial investment via its first financing round.” 

Organic Energy System’s plan capitalizes on the growing global interest in clean energy by making and marketing economical and environmentally friendly distributed energy systems using next-generation biomass fuel technologies. Put in more Texas- friendly terms, they turn cow manure into electricity. The three McCombs MBA team members, Tamara Young, Andy 
Rose and Ted Calvin, said their plan uses a five-megawatt gas turbine system to convert organic materials into natural gas that could enter a $40 billion market. “We hope that it will also serve to make the world a better place,” said Young.

The competition is a real world simulation of how venture capital is raised. Judges, themselves prominent venture capitalists, act as an investment group seeking consensus on the business venture they would most likely fund. Teams are judged based on the quality of their idea, strength of the management team, and the persuasiveness of the written plan and oral presentation.

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Honda Teams with Students to Market SUV

For 11 undergraduate business students, this semester is a crash course in the real world as they create a working marketing agency to research, implement, and evaluate a promotional campaign for the new Honda Element.

Trying to reach “Generation Y” with its new gateway vehicle, American Honda Motor Co. instituted the Honda Element College Program, which challenges teams of BBA students at campuses across the country to create the best marketing campaign for the Element. 

With the Element’s target demographic of 18-24 year-old active males in mind, the marketing students scheduled a series of events in Austin including activities during South by Southwest, on Town Lake, and at the University of Texas campus. The contest will culminate with the students making a formal, agency-style presentation to representatives at Honda. The top two national teams will fly to Honda’s corporate offices in Torrance, CA to present their marketing programs to Honda executives and will also be eligible for a $5,000 scholarship.

“Students are in a catch-22 situation when entering the job market,” says Herbert Miller, senior marketing lecturer and faculty sponsor of the independent study group competing in the Honda Element program. “They have no experience, but they can’t find a job because of their inexperience. This program really bridges the gap between industry and education and provides students with the experiential learning that will make them stand out when looking for a job.”

The student members of Oasis Solutions (the name they gave their agency) are Kimberly Zaskoda, Alice Lou, Crystal Thompson, Brian Carter, Crystal Sandoval, Kristin Klenzendorf, Zachary Rippstein, Lisa Osterhout, Dominic Soria, Andrew Stevens, Kristiann Krieg, and Bryan Stone. 

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On Eve of Retirement, Culver Receives Eyes of Texas Award

Joe Culver, senior lecturer in management, has been awarded the Eyes of Texas Excellence Award for spring 2003. In a letter from the anonymous student organization that bestows the award, Culver is recognized as “a friend, mentor, counselor and father figure” to students. For Culver, who has dedicated his life to helping more than 6,500 students find their purpose, the award, given to only 10 members of the campus community each semester, is especially deserved.

“My favorite quote is ‘A classroom is four walls with a future inside,’” says Culver, who will retire on May 31, 2003 after 23 years of teaching and over 40 years of total service at the University. “I recognize the students I teach are the future, and I enjoy helping them as much as I can.” 

As supervisor of the internship program for the Department of Management, he recognizes how tough attending a university can be. “The curriculum is demanding and I like to give them help and advice on how they can create their own niche here and do well.”

For Culver, the most rewarding aspects of his job come when he sees his students get their first full-time job upon graduation and follows their success in the world. “I spend much of my time talking with students and keeping in contact with former students,” says Culver. “I just love seeing them succeed.”

And sometimes he is a big part of their initial success. An avid networker, Culver eagerly provides students with the names of people who can possibly provide valuable internships or their first jobs. Many times those contact names, kept in an overflowing rolodex on his desk, are former students. A poster in his office proclaims: “The Road to Success is always under construction.”

Preparing for his retirement and packing up his office seem to be taking a bit more time than anticipated as he sifts through years of material. “I’ve just been going down memory lane as I pack,” he says. “I have immense pride in these memories and in the past and future success of my students.”

Culver is past recipient of the Texas Excellence Teaching Award, Alpha Kappa Psi Best Professor Award and the Texas Educator of the Year Award presented by the Texas Society of Human Resource Management. He is a retired Colonel in the United States Army Reserves, and received both his bachelor’s and master’s degree in personnel management from the UT 
business school. He first worked for The University of Texas System, eventually becoming director of personnel for UT Austin and then assistant vice president for development. 

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Schkade Book Suggests Changes for Punitive Damages

Experts in law, economics and human decision-making have reached a troubling conclusion about how juries in civil lawsuits arrive at decisions on punitive damage awards: erratically, with vastly unpredictable monetary judgments, and often with no heed for a judge’s specific instructions.

In “Punitive Damages: How Juries Decide,” (University of Chicago Press, 2002) a nationally renowned group of scholars, including 2002 Nobel Prize-winner Daniel Kahneman and McCombs School Management Professor David Schkade, propose a radical alternative to the present U.S. system of punitive damages, which they describe as being inconsistent, unclear, and tending to produce disproportionately large damage awards.

Schkade’s work contributed to one of the book’s more surprising conclusions – that the deliberative process itself tends to produce a “severity shift” leading to higher damage awards. This shift results from the dynamics of deliberating juries, where individuals who advocate higher punitive damages often prevail over moderate fellow jurors.

“No matter how reasoned and well-intentioned the individual jurors might be, when they are deliberating as a group, they sometimes go a bit crazy in arriving at a dollar figure for punitive damages,” Schkade says. Ultimately, the authors of “Punitive Damages” suggest that shifting the determination of dollar amounts to judges makes more sense than letting individual jurors rely on their private belief systems. 

In a March 3, 2003, book review, the Legal Times says, “This is a ground-breaking book that will rank with The American Jury in its influence on American law.”

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MBAs Explore Mexican Business Landscape

With different motivations but a common destination, 16 McCombs MBAs boarded a bus in Austin last fall headed to Mexico. The first so-called “Study Trip to Monterrey” proved so successful that its organizers hope it will become an annual event. 

Conceived by second-year MBA student William Huang—who had taken a summer course in international operations and management with Dr. Jaime Alonso Gomez, visiting professor at McCombs and dean of EGADE, the business school at Monterrey Tech (ITESM)—the study trip had several components. The group visited Mexican businesses, networked with UT alumni, met with MBA students and business professors on the EGADE campus, and did some site-seeing in the city of Monterrey.

McCombs MBAs considering a semester abroad or dual degree in Mexico or South America were among those on the trip, as well as students who wanted to see global business in practice and those who just enjoy traveling. 

Visits to CEMEX, TYMSA and HEB-Mexico were highlights. “CEMEX really demonstrated how you can take what some would consider a tired, ‘unsexy’ commodity business, make it internationally competitive and take it global through top-notch management, investments in technology, and carefully planned strategic acquisitions,” said Dave Ross, a second-year student. “It was great to see many of the concepts and strategies discussed in class executed so well and with such great success in the real world.”

The students were also very impressed with the people they met. “There seemed to be UT alumni at every event,” recalled Patrick Herde, a first-year student who plans to pursue a double degree at FGV in Brazil. Isabel Aneyba, a recent UT MBA (graduating in 2002 with a double-degree from McCombs and EGADE), noted, “By being with my UT MBA classmates again, I appreciate that we not only share a common business perspective but developed a sense of adaptation that you only see when you meet global players.” Aneyba currently works for Johnson & Johnson in Monterrey as a sales and marketing specialist.

Regardless of their reasons for joining the expedition, the students all felt that the experience was invaluable, due in large part to the close connections between UT and EGADE that have been built through years of partnering and educational exchanges. 

Huang gives much credit to Diane Wilson in UT’s Center for International Business Education and Research (CIBER) and Paulina Aguirre in EGADE’s International Programs office for helping to organize a trip that was exciting, fun, and educational. 

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Texas MBA Hedge Fund Organization Hosts Symposium

The newly formed Texas MBA Hedge Fund Organization (MBAHFO) is rapidly establishing a strong presence and reputation industry-wide. Founded by first year MBA students Holly Goodrich and Courtney Powers, the MBAHFO began as a group of entering students with a common interest and commitment to the hedge fund industry. The organization has since grown to more than 75 members and has become an active part of the McCombs MBA community. 

In March the MBAHFO held the first annual MBA Hedge Fund Symposium. McCombs MBAs gathered at the Driskill Hotel with more than 50 industry professionals —including principals, portfolio managers, risk managers, prime brokers and MBA students from Carnegie Mellon, Chicago, Cornell, Duke, MIT, Rice, SMU, and Trinity Western University for the symposium. 

The keynote speaker was Dr. Richard Lindsey, President of Bear, Stearns Securities Corporation, and the three panels were made up predominately of UT alumni in the industry.

“Our organization thrives on the dynamic and undiscovered nature of the hedge fund industry, and our long-term success stems directly from a desire for expanded knowledge,” said Powers, VP of the group. 

McCombs is the first MBA program to host this type of event, and it has received some recent press as a result, including recognition from Fortune magazine and Hedgeworld.com. 

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Texas Grad Gets Top National CPA Score

John McInnis, a 2002 PPA program graduate of the McCombs School, earned the highest score in the nation on his Certified Public Accountants licensing examination. He will recieve the American Institute of Certified Public Accountants Gold Medal for his accomplishment.

McInnis, hired as an auditor at the Houston office of Ernst & Young in October, scored four grades of 99—the highest score possible—in the two-day, four-part CPA licensing examination, according to the Texas Board of Public Accountancy, the state agency that administers the test.

“About 60,000 people nationally take the exam, and the number of people who score 75 percent or greater (passing grade) is between 20 and 30 percent, so McInnis’ score was pretty brilliant,” McCombs accounting professor Ed Summers said. An applicant must pass every section of the exam before being eligible to receive a Certified Public Accountant’s license. 

Stephen Limberg, accounting department chair, noted that McCombs has produced six top-three national finishes since 1995. “But John’s perfect performance has now set a new standard of excellence. It is a terrific personal accomplishment.”

“I felt I had done well, but I was truly shocked when I found out what my scores were,” McInnis said. “I had no idea I would score this high.” McInnis, who does not believe in cramming, took a semester-long CPA prep course before graduating last May.

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The McCombs Degree Comes to Dallas

Residents of the Dallas-Ft. Worth Metroplex area now have the chance to earn the most highly ranked MBA in the Southwest right in their own neighborhood.

Based on the Option II Executive MBA Program (ranked 12th worldwide by Business Week), the Texas Executive MBA at DFW has the strength of a McCombs degree combined with a convenient location at the American Airlines Training and Conference Center (AAT&CC). Classes are taught every other Friday and Saturday from 8 a.m. to 5 p.m. for five semesters. 

“The professors I’ve had in the program are the best I’ve ever had, and the program is rigorous and challenging,” said John Hallam, VP and general manager of Ben. E. Keith Beers, and a current student in the program. “There are a lot of take-away skills.” Having earned his undergraduate degree from another university, Hallam wanted to take part in his family’s tradition of education at UT. “Everyone else in my family got degrees from UT Austin— my mother and father, three uncles, and an aunt!” he said. “Having the opportunity to earn my degree from UT Austin while living in Dallas was the perfect option for me.”

Applications are currently being accepted for fall 2003 admission to the program. Potential students should have five years work experience and a bachelor’s degree, and will need to submit a GMAT score, along with transcripts and letters of recommendation. 

Those interested in the program, should call 512-232-6243, or visit www.mccombs.utexas.edu/txemba.

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Conference Explores Auditor’s Changing Role

The McCombs School’s Center for Business Measurement and 
Assurance (BMAS) held a conference in February 2003 exploring recent changes in the auditing profession. Titled “From Expanded Vision to Sarbanes-Oxley in Five Short Years,” conference panelists included Joseph Berardino, former CEO, Andersen Worldwide; Charles Niemeier, acting chairman until May 2003 of the Public Company Accounting Oversight Board; and Zoe-Vonna Palmrose, a University of Southern California accounting professor.

The conference was a rare opportunity to hear insiders discuss the changing audit climate. “The technology-driven business environment of five years ago provided an expanded vision of CPAs as trusted business advisors on many issues,” explained William R. Kinney, director of BMAS. “But the Sarbanes-Oxley Act, signed into law by President Bush in July 2002, now restricts CPAs auditing a publicly traded company to the audit of its 
historical financial statements and internal controls.

“Through our conference series, the attendees—emerging scholars, PhD students, and their more senior counterparts—have explored the fundamental role that measurement and assurance services play in contemporary business,” Kinney continued. More than 350 professors and students from 64 colleges and universities have attended the series. 

In his closing remarks, Kinney stressed that the breadth of accounting education and research includes all aspects of high quality information for decision-making, not just accuracy of historical financial statements. He thanked sponsors Andersen, Enron, Deloitte & Touche, Entergy Services, KPMG, and PricewaterhouseCoopers for their support of the center.

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Executive Education's STAR Program

This past January, Texas Executive Education, in partnership with Sogang University in Seoul, South Korea, directed a marketing research project for LG Electronics (LGE), Korea’s premiere consumer electronics company.

Providing the intellectual expertise and practical applications for LGE’s STAR (Sogang-Texas Applied Research) Program, Executive Education offered an in-depth look into several pressing marketing themes. 

Eighteen LGE STAR executives spent four weeks in Austin researching how to develop a marketing plan to launch six new consumer products in the US market. 

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Women Business Leaders Convene at McCombs

Speaking to a packed conference of MBA students and businesswomen in February, C. Kim Goodwin, managing director of State Street Research and Management Company and a McCombs MBA 87, described the “invisible boundaries” that she and other professional women have had to cross while working in the male-dominated world of investment banking.

The celebrated financial manager and frequent guest on “Louis Rukeyser’s Wall Street” told the predominantly female audience, “The ‘Keep out’ signs are not posted, but they are still there.” Such obstacles, however, are often the best opportunities: “If the guys want to keep you out,” said Goodwin, “there’s probably something interesting going on.” 

Goodwin’s keynote speech kicked off the 2003 Women in Business Leadership Conference at the McCombs School. The day-long conference, organized by McCombs MBAs and the school’s Bureau of Business Research, featured one of the most impressive rosters of women business leaders ever gathered in Texas. Nine panels featured 38 executive officers, vice presidents, founders and senior managers representing such firms as Dell Computer, Goldman Sachs, Deloitte & Touche, Citigroup, Frito Lay, JP Morgan, Ford, and Public Strategies. 

Laura J. Kilcrease (UT MBA 92), founder and managing director of Triton Venture Partners, L.P., won the 2003 Trailblazer Award for outstanding achievement by a woman in business. In her acceptance speech, Kilcrease sang the praises of women helping each other through networking. “When you do something for others,” she said, “it often comes back to you in ways you don’t expect.” 

Crossing boundaries served as the theme for all nine panels at the conference, which covered a range of topics from managing diversity to improving business ethics, networking, and the convergence of for-profit and not-for-profit business practices. 

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For information on specific programs at the McCombs School, consult our contacts page. For media information, contact the Communications Director by phone at 512-471-3314 or by email at CommunicationsDirector@mccombs.utexas.edu.

 
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