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A McCombs Education PLUS
Worldwide Tour Exposes MBA Students to Global
Business
This spring, to explore opportunities in global markets, nearly 300 MBA students from McCombs took part in a series of two-week study tours to China, India, Eastern Europe and other locations around the world.
An increasing number of MBA programs offer study tours, which feature intensive meetings with executives, strategists and government leaders. The McCombs trips are distinctive for their hands-on approach. In addition to learning about foreign practices, McCombs students complete and deliver consulting projects for companies doing business in their host countries.
While the trips are short, they can leave lasting impressions. Below are excerpts from journals kept by students during their trips this spring, offering snapshots of business conditions from India’s bustling outsourcing sector to Moscow’s credit-starved consumer economy.
Hungary
In the afternoon, we visited Ikarus Holding Co. Ltd, a company
started in the 19th century with core operations in component
manufacturing for autos and trucks. (Audi is their largest customer.)
Perhaps most striking about this visit was the facility’s lack of
safety measures. Neither the employees nor the visitors were required
to wear protective attire such as eyewear or gloves. In fact, one
employee operating heavy machinery was puffing on a cigarette as he
controlled a machine covered with grease and oil. It is my guess that
this lack of precaution is common to Hungarian manufacturing
facilities; moreover, it will be interesting to see how companies
adapt as accession to the EU requires more stringent compliance with
industrial regulation.
—Brad Johnson
China
Today we spent the first part of the morning learning from the
China Securities Regulatory Commission—the Chinese equivalent to the
SEC. While some of the discussion was out of my area of academic
expertise, I thoroughly enjoyed the session and gained additional
insights into the Chinese government’s financial system. In addition,
this provided my project group (commercial banking opportunities for
foreign banks entering China) with the opportunity to ask questions
directly pertaining to our Plus project.
—Holly Lanham
South Africa
Today provided a snapshot of South Africa for me –
politically, socially, and economically. We started the day at 3M
South Africa. The campus was breathtaking, set in a “safari
landscape.” 3M began with a brief overview of the business, and then
four McCombs MBAs took the stage and presented their ideas for
segmentation of the visual projector market. Afterwards, a Q&A with 3M
and our group was followed by a lunch.
Then we loaded the buses and
departed for Soweto, a Johannesburg, South Africa, township. Until
this afternoon, South Africa has felt just like home to me–familiar
restaurants, hotel chains, developed roads, the latest fashions. But
in Soweto, the standard of living was vastly different. Literally,
aluminum and paper products made shelter for these families. There was
no plumbing or electricity. Life here looked impossible. However, I
couldn’t help but notice the smiles on the faces as we drove by.
Children were skipping home from school and playing games in the
street. Unaware of their surroundings, which are less than ideal, they
are happy children. In my eyes, it is these happy children, the next
generation of South Africans, who will continue the progress in the
country.
—Caren Williams
India
Any misconceptions we had about the level of sophistication of
Indian business were erased by our visit to Infosys in Bangalore. The
company’s campus included its own replica of the Sydney Opera house
and the most popular Domino’s Pizza in India – both testaments to
world-class operations. After the tour we listened to Nandan M.
Nilekani, CEO, president and managing director of Infosys, speak about
the future of the company and the awareness of business process
outsourcing.
Our final visit of the day was with Professor Chandrashekar, the state of Karnataka’s minister of IT and education.
The discussion was covered by the local press, prompting a newspaper
article and television spot the next day. Our group gained valuable
insights from this meeting on the state of the education system within
Karnataka and India.
—Adam Courneya
Brazil
Today we visited a school in one of the largest favelas in Sao
Paulo. The poorest of the poor in Brazil call these shanty towns home,
many surviving on less than U.S. $50 a month. Coming from a large
city, I had seen what I thought was poverty, but this was on a
different scale than anything I had seen in the U.S.
I felt very awkward as the bus rumbled down the dirt road toward the school. Here was a group of 31 graduate students from the U.S., spending thousands of dollars to better their education and extend their career opportunities: what right did we have to come and gawk at these people whose lives were so much more difficult? At times I felt like I was looking into a fishbowl – and it was very uncomfortable.
But when we
got off the bus and entered the school I felt immediately at ease.
There were children running around laughing and yelling. They smiled
and waved at us as our tour began. The school was a
government-sanctioned project to promote literacy and learning within
the favela. A group of us entered a first grade classroom and
introduced ourselves to the class in the best Portuguese we could
muster. With their teacher translating, we asked what some of the kids
wanted to be when they grew up. The responses varied from going into
the army to being famous to learning to speak English. But the one
that stuck out in my mind was the little girl that said she wanted to
have enough money to buy her mother a house.
—Ned Duggan
China
The trip to the Commercial Services division of the U.S. Embassy
was incredibly enlightening. We were fortunate to have the opportunity
to learn from one of the members of the team that consults with U.S.
firms looking to enter the Chinese marketplace. Our discussion
included the many risks involved in conducting business in China – in
particular, the lack of legal infrastructure and the high prevalence
of product counterfeiting. One key advantage of this session was that
we were able to candidly visit with someone about our age who had
recently decided to move to China to continue her career. While we
asked many questions pertaining to the planned subject matter, we also
gained additional perspective on what it’s like to be a U.S citizen
working and living in China. Her knowledge and insights into this more
personal topic made this session especially beneficial.
—Holly Lanham
China
This morning we had our first team meeting with our Jiao Tong
MBA team, and it was…interesting. It gave me an entirely new and
firsthand perspective on what it’s like to work in international
business. Our team is working on a complex supply chain and logistics
problem for an American technology company whose manufacturer is
relocating from Taiwan to China, and we are trying to do this while
managing communication between two ambitious MBA teams with a language
barrier and cultural unfamiliarity.
—Claudia Castillo
Russia
On the evening of the Russian presidential elections, our group
went to the Bolshoi Theater: sitting inside there were few indications
of the new Russia. The curtain was a blood red and covered in golden
hammer and sickle logos, along with “CCCP,” the letters that stood for
the Soviet Era government. When we left the theater, we smelled smoke
and saw a massive fireball down the street that formerly was the huge
Manege Exhibition Center that was built in 1817. Firefighters were
aggressively trying to put out the flames, but they were much too
late. The Russian papers initially reported that the fire was an
accident, but many of us suspected that it was intentional and meant
to protest the overwhelming reelection of President Vladimir Putin.
—Mike Duncan
India
After a day full of company visits, we relaxed at Professor Konana’s family residence, complete with Indian food and live
traditional Indian music. The contrast to the serious business trips
allowed us to kick back and reflect on the program to that point.
Additionally, we were able to meet the family and friends of Professor
Konana, opening a more personal side of the country.
—Adam Courneya
Hungary
We visited Hewlett Packard in the morning and heard lectures
by three speakers regarding Central and Eastern European business and
how the “HP way” operates within this realm. It was interesting to
hear from Karel Vavruska, an enthusiastic speaker, who detailed
numerous opportunities he had to turn down because bribery, a common
practice in this area of the world, would not be accepted in explicit
or implicit form by HP. The offices, like the giant Hungarian telecom
Matav, were wellkept and modernized.
—Brad Johnson
China
Our visit to Intel was made possible by recent McCombs alumnus
Bobby Gujavarty. He took part in the Plus China trip last year and
apparently enjoyed his experience so much that he decided to restart
his career after graduation in Shanghai with Intel. We were able to
take a short tour of the Shanghai Intel facility and then had a
discussion with one of the finance managers regarding Intel’s business
in China. Notably, Intel mentioned they were hiring and encouraged
anyone in the group interested in a job with Intel China to apply.
—Holly Lanham
Russia
Today we took a tour of Citibank, and then Allan Hirst (BBA 79,
MBA 81), president of Citigroup Russia, invited our group over for
dinner. He lives in a large apartment not far from Red Square that at
one time belonged to Vyacheslav Molotov, of ‘Molotov Cocktail’ fame.
He took the name Molotov, which means ‘hammer’ in Russian, as he rose
up the ranks of Stalin’s Russian Social Democratic Labour Party. Allan
got great pleasure out of knowing that an American capitalist and
banker now inhabited a space that was once occupied by a hardline
communist. I’m not sure what Molotov would have thought about a couple
dozen American MBAs inhabiting his former home, but my guess is that
he wouldn’t have enjoyed the irony. Allan – having lived his entire
life (after bschool) outside the U.S., had some interesting views on
the progress Russia has made to date. My assessment: he exhibited much
more patience and optimism than most other expats I heard.
—Mike Duncan and Will Withers
India
Today we made one of the best visits of the trip to the Reserve
Bank of India in Bombay to get an understanding of the economic
challenges that India faces as it emerges from over 40 years of a
state controlled economy. The principal advisor for economic analysis
and policy and his colleagues gave us new insight into India’s
liberalization efforts, foreign exchange controls and monetary policy.
—Trip Spencer
Czech Republic
Today we were given a fascinating lecture at
multinational PriceWaterhouseCoopers on a very specialized sector of
the business advisory industry: organizational fraud investigation.
This branch has thrived in the Czech Republic since the Velvet
Revolution (downfall of communism in Czechoslovakia in 1989), as
bribery and embezzlement still run rampant in business practice. I
think the representatives who spoke with us, Ian Glogski and Jan
Vylita, conceded that this is a big problem in the region and will
require extensive improvements as the Czech Republic, Poland, and
Hungary accede to the EU.
—Brad Johnson
China
In order to hear another perspective of the commercial banking
environment in China, one of my group members, Todd Haskins, arranged
for us to meet with Citibank China. One of the things that impressed
me most about this meeting was the number of women we met in senior
management positions. We talked briefly about the acceptance of women
in positions of power in China, but to see it in action was especially
encouraging. Two out of the three executives we met were women, and
the most senior person present was a woman.
—Holly Lanham
Russia
After our group’s presentation at the Higher School of
Economics, our project sponsor, David O’Hara, sat down with us and
very candidly described the Moscow/Russian business environment in
which he operates. O’Hara is a real estate broker with Stiles & Riabokobylko Ltd. in Moscow and is considering marketing land to be
developed for industrial use.
Mr. O’Hara shared with us was the fact that the Russian economy is essentially U.S. cash-based. Russia has more hard U.S. currency in circulation than does the United States itself, and the $100 bill is used in most sizable business transactions. People even pay for their personal apartments with stacks of U.S. currency. The motivation for this cash-based economy is to avoid records of transactions, which makes it easier to avoid paying taxes.
At the consumer level, the effects of the cash-based
economy are significant. Russians typically have no savings. Payroll
is distributed in cash, and Russian consumers spend an estimated 85%
of all income, while having virtually no debt. This is in stark
contrast to their American counterparts who use debt for the purchase
of homes, cars, education, and even groceries. This conversation
complemented what we learned at CitiBank a few days prior, but also
magnified the obstacles that CitiBank will face in its consumer
lending division with regard to the population's general perception of
the negative aspects of using debt.
—Will Withers
India
This evening at our final dinner together in India we met with
local McCombs alumni and got a better understanding of the supply
chain and infrastructure challenges that Indian businesses face. As
the leader of one of the premier logistics firms in India, Cyrus Guzder, chairman and managing director of AFL Private Ltd., has
intimate knowledge of the issues that affect Indian logistics today:
major infrastructure inadequacies, a fragmented trucking industry,
hidden transaction costs, and lack of an integrated delivery chain all
contribute to inefficiency and higher costs. It will be interesting to
follow the development of Indian logistics as infrastructure and
integration improve; hopefully, companies will see inventory levels
and distribution costs fall as a result.
—Trip Spencer
China
Tonight we had our closing ceremony and dinner, and our
McCombs-Jiao Tong project team tied for first place in our group
competition! After our first difficult meeting, our team really
rallied and learned how we could work together. Professors Doggett and
Sepulveda had asked our Chinese counterparts to present so that they
could work on their English presentation skills. We knew it would be
tough for them, but we went over our presentation many times and fired
questions at them that we thought the professors would ask.
Thankfully, many of the questions asked of them were ones we had
prepared for. These two weeks have been a great experience, both
personally and professionally. I know that I’ve made lifelong friends
in the Jiao Tong students on my team!
—Claudia Castillo
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.
