Every year the second years get one more taste of the realities of leading: not only do we nurture, create, and accomplish exciting things with our groups, but then we have to turn everything over to the next group of leaders.

It’s a bit of a catch-22 in some ways. As March and April go by, our focus as second years has shifted a bit away from Goizueta and into the next chapter of our lives – that of newly-minted MBAs. We’re looking for jobs, housing, scheduling moves around Atlanta and around the world, several our classmates are getting married, others are looking forward to being reunited full time with their families and children and loved ones, and there are celebrations upon celebrations around graduation and all these other life events. So it is a good time to turn over leadership to the first years (and one years who are about to arrive).

On the other side of things though, these groups that we have been leading (it’s the Honor Council for me and participation with this blog among other things) have taken on special importance and significance in our lives. They have been the groups through which we have been able to affect our community and our classmates, through which we have been able to achieve goals of ours, and from which we’ve gained incredible experience leading and learning from our peers.

Other positions (at other schools and organizations) I have held in the past never made quite a point regarding transition. I think there really are two strong forces at work at the end of a term – not wanting to give up something you have nurtured for so long, and the natural tendency to be excited and focus on the next thing and consequently lose touch with the daily impact of a group and position. Goizueta is set with a history that makes transition a necessary and somewhat formalized process: Leadership March.

We all know we’re going to be giving up these opportunities to serve our community so directly, but through the Leadership March process we’re also going to be handing over our accomplishments, goals, and learnings to a group of students who are just as passionate and who will benefit just as much from leading as we did. Spring semester in general tends to turn into a time of clarifying logistics, processes, and documenting the last year and our lessons so that the next round of leaders can spend time nurturing and creating rather than trying to figure out the last year and reinvent the wheel. Leading at Goizueta is an incredible experience, and because of traditions like Leadership March, we get a taste of the entire cycle of leadership from start to finish.

Have We Turned The Corner?

That was the topic of a Professor Tom Smith talk this past Monday at Goizueta.  From unemployment figures to pumpkin harvests, Professor Smith covered the spectrum of indicators that tell the stories you’re familiar with, such as “GDP is ticking up; good times are here again!” and “Oh my God, unemployment is 10%.  I should really put off buying that 3rd iPhone.”

Professor Smith began by citing pumpkins.  Turns out that canned pumpkin has been a bit hard-to-find on store shelves this season.  All I know is that my girlfriend loves to bake with pumpkin, so we never have less than a few cans on hand.  If you couldn’t find canned pumpkin in your local Publix this week, she’s to blame.  And honey, if you’re reading this, the pumpkin bread pudding was delicious and everyone loved it.

Apparently people like to point to pumpkin shortages as a sign of the economy.  Kind of like seeing the Virgin Mary in a potato chip, only with pumpkins and GDP growth.   As Professor Smith pointed out, this doesn’t make a whole lot of sense – the scarcity is just a result of the Illinois pumpkin crop getting wiped out by heavy rains – but you’re still welcome  to begin your WSJ editorials with, “As we see with the pumpkin shortages….”

Tom: 1; Pumpkins: 0.

Next we get to unemployment.  Tom Smith LOVES unemployment.  As an indicator.  (I’m sure he’s a very nice guy who doesn’t want to see other nice people lose their job.)  And since the unemployment rate has more than doubled in the past two years – levels we haven’t seen since 1983 – Professor Smith gave us his capital-T Theory.

The thing you have to know about b-school professors is that they all have big capital-T Theories that haven’t been published in more than their textbook yet, but perhaps one day.  Tom Smith’s Theory is that the time it takes to get back to pre-recession unemployment rates is the single greatest indicator of how bad a recession is.  Whether it’s true, it’s a Theory that *should* be true.  Would you rather see the S&P regain 35% of its lowest value or see the peak unemployment rate decline 35%?  I’m with the latter, and unless you’re an investment banker with no heart for the human toll taken by the worst recession this country has seen in 70 years, I bet you are too.

Tom: 2; Mean Investment Bankers: 0.

Tom Smith also has what he calls his rules of ten.  10% unemployment? Bad.  Ten states with unemployment way above the national norm?  Bad.  Not quite a capital-T Theory – not “publishable results,” as they say – but still a handy heuristic to pull out at the next kegger.

Tom: 12; Kegs: 12.

The other high point of the Tom Smith Experience was learning how Alan Greenspan likes to use men’s underwear.  As an indicator of growth.  The idea is that since men only buy underwear when they have to, it’s the ultimate non-luxury good that isn’t an essential like food.  Good news, then, that Hanes and Under Armor are both forecasting higher sales in 2010. But the effect of such underwear discussion is little more than a series of awful double entendres around words like performance, growth, and whether spending has “loosened up.”

Tom Smith: 13; Tom Jones: [censored].

Tom finished strong (sorry), (1) arguing against the likelihood of a quick return to 2006 unemployment levels (partly because the rate of mass layoffs is extremely high), (2) commenting that inflation is low and no one can decide where it’ll go next, and (3) lamenting the weak dollar, which is great if you’re a French Exchange Student at Goizueta (“Hi, Thibault!”) but stinks if you like buying cheap toys made in Korea for your nephews.  (“Sorry, Theo. Uncle Andrew is a business student and isn’t making any money right now.  Here, have this pointy stick.”)

Tom: 14; Theo: Sad.

So have we turned the corner?  Not really.  Stay tuned next time for more rhetorical questions, capital-T Theories, and double entendres about men’s underwear.  Stay classy, Internet.

–
Andrew K. Stein
Goizueta Business School
MBA Class of 2011

I have a rocking chair list. It’s like a bucket list, but essentially, it’s a list of things that I can say “I did this…” when I am old and grey and contemplating the world from my rocking chair. Skydiving is on that list. It has been for about five years now and I haven’t done anything about it. Why skydiving? I guess because I’m afraid of it. I am terrified of heights, and there truly doesn’t seem like much sanity in jumping out of a plane for fun, not from my terrified-of-heights perspective. There’s something about having skydived though that I thought would be a sort of feather in my cap. Or maybe I just imagined that once I had skydived, it would put other fears in perspective: “this deadline is really aggressive, but I’ve jumped out of a plane, how bad could it really be?” Or “I’ve never done anything like this before in my job, but I’ve jumped out of a plane, how bad could it really be?” Apparently the ability to qualify everything with “how bad could it really be?” is pretty significant to me.

One of the best pieces of advice I received when I came to Goizueta was from one of our orientation captains my first year. She encouraged every one of us to throw ourselves into our experiences and to not hold back because we have a short time here, we are ready for change if we came to business school, and Goizueta is rich with experiences, so if you hesitate you’ll miss them. Skydiving is also a kind of tradition at Goizueta. About once a semester a group of students go and temporarily put their sanity on hold or have one of the best adrenaline rides in their lives, or both (depending on your temperament of course.)

The community at Goizueta encourages this too. Courage is one of our Core Values. I doubt the Core Value of Courage was written with the idea of jumping out of planes, but intense physical challenges do tend to put other things, like standing up for what you believe in, in perspective (i.e. – the excuse to tag “how bad could it really be?” onto just about everything.)

Last year the chance came to skydive and I bailed. I had signed up and just chickened out. I wasn’t ready and I was too terrified. This year, after a year of intense growth at Goizueta I found myself no less terrified, but a lot more willing to just go for it. So I did. I jumped out of a plane last Saturday. The support and cheers from my classmates (both those who went and those who greeted me in class on Monday) made my courage that much sweeter. I understand why it’s a tradition at Goizueta now. Not just because I can tack on “how bad could it really be?” to nearly every challenge, but because throwing myself at every opportunity has yielded me some incredible results. Including crossing off an item on my rocking chair list that could have easily become dusty with age and opening the way to many more challenges I might have otherwise hesitated on too long.

Tune in to the activities as Goizueta Business Schools hosts the New York Stock Exchange on Wednesday, September 2, 2009!

Duncan Niederauer (GBS MBA Class of 1985) CEO of NYSE Euronext will co-host the event.  There will be live coverage all day long, including the ringing of the closing bell by the Goizueta Business School Community.

The event will be televised on the national media feeds including:

• CNBC
• Bloomberg
• www.cnn.com
• www.nyse.com
• www.goizueta.emory.edu

After the event, all the details, videos and news will be housed at:

http://www.goizueta.emory.edu/nyse/

We are all really excited about this momentous occasion, and would love your support!

Earlier this year, students from Goizueta Business School had the opportunity to travel to Omaha for a Q&A with The Oracle of Omaha, Mr. Warren Buffett. I had heard a lot about the last year’s trip, and I was very excited to be part of this year’s meeting with Mr. Buffett.

Following is an excerpt from the Q&A.

Warren Buffett Meeting 2/6/09

Kansas:
Berkshire has invested in several insurance companies, would you go into the health insurance business?

Mr. Buffett:

No.  Health insurance is so ingrained into national policy that it is a tough business.  It’s pretty adversarial.  I’m not really that excited about it from a business perspective.  I don’t want to write policies with high loan loss ratios.  That being said, I would buy the stock of an undervalued healthcare insurer.

Insurance is an interesting business.  You know, we underwrote a two year life insurance policy on Mike Tyson.  I wanted an exclusion against women shooting him, but they wouldn’t let me.

South Dakota:
You’ve recently invested in Goldman Sachs and GE.  Is the financial sector a good buy right now?

Mr. Buffett:

No sector is a good buy unless you understand the business.  However, I do believe that there is good value and great opportunity now in the financial sector because it is extremely unpopular.  Sector’s themselves don’t make good buys, companies that are undervalued make good buys.  You know how to value a business, you project the future cash flows discounted to present and buy with a margin of safety.  The earnings prospects need to be greater than the current value.  Anything that is unpopular is always great to look at.  If I was getting out of school right now, I would take a look.

Creighton:
How much and how does risk factor into your investment decisions?  Would you invest in emerging markets?

Mr. Buffett:

In general, emerging markets are not great for me because I need to put a lot of money to work.  Risk does not equal beta.  Risk comes around because you don’t understand things, not because of beta.  There are normally 10 filters or so that I go through when I hear an idea.  The first is can I understand the business and understand the downside not just today but five to ten years from now.  There have been very few times that I’ve lost 1% of my net worth.  I might be risk averse but I am not action adverse.  Mrs. B saved $500 over the course of 16 years to start and build Nebraska Furniture Mart.  Tom Watson Sr of IBM said, “I’m smart in spots and I stay in those spots.”  I just stay within my circle of confidence.  When I bought Nebraska Furniture Mart in 1983, Mrs. B took cash and not Berkshire stock.  Why?  She didn’t understand the value of stock.  She understood cash and that is what she took.  I need only need to be right a few times and can let thousands of ideas go by.

Ted Williams, who wrote the “Science of Hitting,”  broke the strike zone into 92 ball shaped sections.  He knew, if hit in his sweet spot, he’d hit 430, a little further out, and he’d hit 350.  You have to know your sweet spot.  The beautiful thing about investing is that it’s a “No called strike game” where unlike baseball the only strikes in investing are when you swing.  I don’t have to swing.

When I do invest, I don’t care if the stock price goes from $10 to $2 but I do care about if the value went from $10 to $2.  Avoid debt.  I decided early on that I never wanted to owe more than 25% of my net worth, and I haven’t… exept for in the very beginning.  I like to play from a position of strength.  I always try to have the odds in my favor.  When I go to Vegas, I don’t go around putting $5 dollars on the blackjack tables.  If someone wants to come to my room and put $5 on my bed, well that’s fine.  I like those odds better.

Emory:
How do you think about value?

Mr. Buffett:
The formula for value was handed down from 600 BC by a guy named Aesop.  A bird in the hand is worth two in the bush.  Investing is about laying out a bird now to get two or more out of the bush.  The keys are to only look at the bushes you like and identify how long it will take to get them out.  When interest rates are 20%, you need to get it out right now.  When rates are 1%, you have 10 years.  Think about what the asset will produce.  Look at the asset, not the beta.  I don’t really care about volatility.  Stock price is not that important to me, it just gives you the opportunity to buy at a great price.  I don’t care if they close the NYSE for 5 years.  I care more about the business than I do about events.  I care about if there’s price flexibility and whether the company can gain more market share.  I care about people drinking more Coke.

I bought a farm from the FDIC 20 years ago for $600 per acre.  Now I don’t know anything about farming but my son does.  I asked him, how much it cost to buy corn, plow the field, harvest, how much an acre will yield, what price to expect.  I haven’t gotten a quote on that farm in 20 years.

If I were running a business school I would only have 2 courses.  The first would obviously be an investing class about how to value a business.  The second would be how to think about the stock market and how to deal with the volatility.  The stock market is funny.  You have no compulsion to act and a bunch of silly people setting prices all the time, it is great odds.  I want the market to be like a manic depressive drunk.  Graham’s Ch. 8, in the book Intelligent Investor, on Mr. Market is the most important thing I have ever read.  Now think about the NYSE.  You have thousands of companies to choose from.  For me, that universe has shrunk because I need to put large dollar amounts to work.  Attitude is much more important than IQ.  You can really get into trouble with a high IQ, i.e. Long-Term Capital.  You need to have the right philosophical temperament.

Penn State:
Why did you invest in Harley-Davidson?

Mr. Buffett:
I like the 15%.  I measured that 15% against other credits and it looked attractive on both a relative basis and an absolute basis.  Also, we have to have a certain amount of the portfolio go to debt.  Lately, the government has become the guarantor for some companies but not for others and the “haves” and “have-nots” determined by certainty of government assistance rather than the credit quality.  These finance companies have a problem getting funded, not with their customers.  Any company where you can get your customers to tattoo your name on their body has quite a strong brand.  For this investment I had to think what is the probability that they will not pay me back and would I want to own the company if they did not, basically that the equity isn’t worth zero.  Risk premiums in the corporate bond market went from real low to real high.  Right now, they’re out of whack.  The flip side is that governments are overpriced.  We have a bubble in governments.  T-bills actually had a negative interest rate.  I never thought I’d see that.  A mattress is a better investment than the US 10 Year.  Buying corporates and shorting the 10-year is a great idea and smart guys went broke doing it because even if you’re right, you need to be able to play out your hand.  I always think about what I would do if a nuclear bomb went off or if Bernanke ran off with Paris Hilton to South America.

Texas:
Do you feel that the might of America has changed?

Mr. Buffett:
You can bet against the dollar, but I would never bet against America.  The system in the U.S. has allowed the country to unleash more for the world than any other country.  Since 1776, the U.S. had a different system than the rest of the world and that system unleashed the human potential.  We were not the smartest nor did we have the best resources.  This is the same system we have in place today with people of similar intelligence.  I have and would bet against the U.S. currency, stocks, etc. but the United States prevails over time.  There are all kinds of rocky roads but we have rule of law, equality of opportunity, and a meritocracy.  We have a market system and people apply energies and imagination to come up with things someone would want.  Everyone in this room is working far below his/her potential.

Kansas:
We know that you are a big bridge player.  Do you think that bridge correlates to investing?  Are there any traits or characteristics that might carry over from one to the other?

Mr. Buffett:
Bridge is the best game there is.  You’re drawing inferences from every bid and play of a card, and every card that is or isn’t played.  It teaches you about partnership and other human skills.  In bridge, you draw inferences from everything and that carries over well into investing.  In bridge, similar to in life, you’ll never get the same hand twice but the past does have a meaning.  The past does not make the future definitive but you can draw from those experiences.  I think the partnership aspect of bridge is a great lesson for life.  If I’m going into battle, I want to partner with the best.  I was playing with a world champion and we were playing against my sister and her husband.  We lost, so I took the scorepad and I ate it.

South Dakota:
What are your views on derivatives and how do you think they have affected the global market?

Mr. Buffett:
In my 2002 letter to shareholders I referred to them as “weapons of mass destruction.”  Derivatives are really just a way to create a product with a very long fuse, for example, 100 years, as opposed to stocks which settle in 3 days.  That kind of system allows claims to be built up.  AIG called me in September and told me they were about to get downgraded which would have required higher posting requirements.  Now this is an enterprise that has been built up over decades and was effectively destroyed in 48 hours by these products.  With derivatives, you’re exposed to counterparties and thus reliant on others.  These claims built up over time to the tune of billions of dollars and when one falls, the whole system falls.  Derivatives are not evil by themselves but rather everyone needs to be able to handle them.  System wide, they’re rat poison.  Berkshire holds many derivatives but we always hold the money at Berkshire.

Creighton:
What do you think about the stimulus package?  Would you rather see tax cuts or government spending?

Mr. Buffett:
We obviously have a problem, but we’ll come out of this just fine.  The idea of a stimulus is to do things that will have an impact quickly and the current proposal won’t do that.  When dealing with situations like this, you can’t do just one thing but always need to ask yourself what is the next question.  We have utilized monetary policy and guaranteed everything in sight.  It’s a standard Keynesian prescription.  Tax cuts benefit people differently in the short term.  We are basically saying, we’re not going to pay for what we’re doing in terms of government spending and that we’ll just mail you some money but it’s better than doing nothing.  In the end, you should buy stock in a business that any idiot could run because someday, one will.  You know, our country is similar.

Emory:
How do you think differently today than you did twenty years ago?  Where do you expect to see the greatest differences in 2030?

Mr. Buffett:
The fundamental things about investing that I learned when I was younger haven’t changed.  I am lucky to have picked up a book at 19, The Intelligent Investor, that gave structure to investing and investment decisions.  Over time, I learned different ways to apply it.  I have learned what it is outside my circle of confidence.  I bought See’s in 1972 and I think understanding the value of brand helped drive the decision to buy Coca-Cola in 1988.  Through experience, I have gotten smarter on predicting and evaluating human behavior.  My wife put me together in terms of human behavior.  I really enjoy doing what I do and I get to do what I want.  I enjoy talking to groups like these.  Irv and Ron Blumkin are some of my best friends and I continue to add friends by buying businesses.  I don’t want a boat or 12 houses.  I’m almost fully depreciated, down to my residual value.  Age doesn’t affect my ability to my job though, as opposed to Arnold Palmer, he can’t play his game.

Penn State:
What advice would you give the average person in the U.S.?

Mr. Buffett:
It’s hard to give advice to someone who might lose their job.  My Dad went to work on August 13, 1931 to find out the bank where he worked and held all our money had closed.  He had no job and no money and two kids.  You want to be as prepared as you can and you just don’t want to have debt.  Medical problems cause a lot of the grief and lots of credit card debt.  Credit cards are poison.  If you make a dollar, only spend 95 cents, not $1.05.  You should be ahead of the game all the time rather than behind as it is harder to work your way out of a hole.  You want to play the game from strength, and you have to think ahead.  People don’t always want to hear advice when things are going well.  People risked everything they had and needed for something they didn’t have or need.  Charlie once said, “The problem isn’t getting rich, it’s staying sane.

Texas:
What are the biggest challenges that this country faces?

Mr. Buffett:
The biggest problem is probably weapons of mass destruction.  We have always had people who were ill-fitted to society and wished harm on others.  In 1945 we unlocked the atom, and that changed everything.  The human animal hasn’t changed, you still have the same percentage that are maladjusted.  The problem is knowledge, materials, and deliverability.  What you could do with the wrong kind of infectious disease is incredible.  You can transmit things much faster today.  Governments, individuals and organizations can’t control security.  It’s what I would spend all of my money on if I could fix it.  Everyone here in this room won what I call the ovarian lottery.  You were born at the right time and we were all very, very lucky.  We are in the luckiest 1% of humanity.

Kansas:
What are some of the mistakes that Secretary Paulson made during the sub-prime crisis?

Mr. Buffett:
Hank is a great guy and great friend.  He’s extremely smart about markets but not so smart about politics.  I sympathize with Hank.  Hank Paulson was not the supreme commander.  He had to work through at least 535 people with different incentives.  The whole situation has developed faster and at an extreme pace, more than anyone thought.  The first TARP program got voted down, which changed the dynamic.  All variables affect other variables.  Congress did not appreciate how severe the problem was.  I call it an “Economic Pearl Harbor” in September.  FDR essentially had a blank check and that what people think is important and believing it makes it so.  He restored confidence in the banking system.  Paulson’s job may have been almost impossible given the circumstances.  He was used to operating in a sphere that did not require consensus (Goldman Sachs).  People that take that on [public service jobs] are laying themselves open to be unfairly attacked, criticized and scrutinized.  In hindsight, letting Lehman fail was probably not the right thing but it was difficult to tell at the time.  It created trust problems as money market funds fell apart soon thereafter.  When people start to worry about the money in money markets, it’s a problem.  People want to be led at this point, but fall back into old habits very easily.  When you think that Citi or Lehman is just a house of cards… I mean who would have even believed you.  It’s like Noah before the flood, building his ark.  Can you imagine the reaction he got?

South Dakota:
What do you think about the U.S. trade deficit?

Mr. Buffett:
I talked to Barack back in August, and said: “I have good news and bad news.  The good news is that the economy will be terrible, so you’ll definitely get elected.  The bad news is that the economy will be even worse at inauguration.” He asked, “Do you think it’s too late to throw the election?”  The trade situation is there and it causes problem and could exacerbate the situation.  However, all issues go on the back burner until we solve the big problem.
We create sovereign wealth funds, buying more goods and services than everyone else in the world.  The decline in the oil price has helped the trade deficit but nothing will get better until everyone feels better.  Every day, we buy $2 billion of goods and service more than we produce and export.  We give the exporting nations USD.  The trade deficit creates claims on the United States.  Sometimes we’re a little hypocritical.  For example, three years ago, the Chinese wanted to buy Unocal (a small oil company in California) and Congress wanted to condemn China for wanting to buy the oil company with the money we gave them (through U.S. imports).  That’s a little disingenuous.  The trade deficit creates a situation because we give people claim checks, then we get upset when they want to use them.  The Japanese bought Rockefeller Center in the 80’s.  Did we think they were going to move it?  It’s not useful to fan those flames in a nuclear world, and that’s what’s wrong with “Buy America.”  The trade deficit will come up big time when we get past the current problems.

Creighton:
Why do you live the way that you do?

Mr. Buffett:
Do you mean, why am I frugal?  You can’t buy health and you can’t buy love.  I’m a member of every golf club that I want to be a member of.  I’m the highest handicap member of Augusta National.  I’d rather play golf here with people I like than at the fanciest golf course in the world.  I can do anything that I want, and I do.  I buy everything I want to have.  I’m not interested in cars and my goal is not to make people envious.  Don’t confuse the cost of living with the standard of living.  Bella Eidenberg was a Polish Jew who was at Auschwitz and some of her family didn’t make it.  Twenty years ago she said she was slow to make friends, and that the real question in her mind was always, “Would they hide me?”  If you have a lot of people that would hide you, you’ve had a very successful life.  That can’t be bought.  I know people that have billions of dollars and their children would say, “he’s in the attic.”
I estimate that I live on $100,000 per year, except for my plane which costs me about $1 to $1.5 million.  I like the plane, it improves my life.  My computer and my airplane changed my life in a big way and I’m not sure, if I had to choose, which one I’d give up.  Anything beyond $50 Million doesn’t improve my life.  If I took out $3 billion of Berkshire stock, I could have paid 30,000 people $100,000 per year to paint my portrait every day.  I could have paid 50,000 people $60,000 per year to dress in loin cloths and haul rocks to create the Buffett tomb.  That’s not me.  I believe in giving my kids enough so they can do anything, but not so much that they can do nothing.

Penn State:
What do you think of the good bank, bad bank idea?

Mr. Buffett:
It is tough to do but if it were done well, it could do a lot.  Call the bad bank an “Aggregator Bank.”  There is a lot to be said in cleaning out past problems.  There are 7,000 banks in the U.S. with such varying degrees of conditions so it is tough to provide a sweeping overhaul.  The biggest thing they’re wrestling with is pricing what goes into the aggregator bank.  These are smart, well-intentioned people working enormously hard on this.

Emory:
You take great pride in keeping your schedule wide open.  Do you believe that corporate America is overscheduled and overstretched?

Mr. Buffett:
[Showed his blank schedule book].  Bill Gates is overscheduled.  I am extremely lucky and I can say no to anything because there isn’t an entity that can use economic pressure to make me do something.  A lot of CEOs get into a lot of the rituals that are part of the job.  I would rather deliver papers than be the CEO of GE.  They have too much stuff to do that is a big pain.  Don’t get me wrong, CEOs have it pretty good.  I’d imagine that every CEO in the Fortune 500 would be willing to take the job for half of the money.  The 76 or so CEOs that run companies at Berkshire don’t have to deal with bankers or lawyers.  At Berkshire, we’ve never had a meeting for all of them anywhere.  There are no presentations and no committees.  They can be more productive, and it makes it attractive when they can do what they like to do best.

Kansas:
What are three traits of successful managers?

Mr. Buffett:
Passion is the number one thing that I look for in a manager.  IQ is not really that important.  They need to be able to work well with others and the ability to get people to do what you want them to do.  I’d say intelligence, energy, integrity.  If you don’t have the last one, the first two will kill you.  All you have is a crook who works hard.  If a person doesn’t have integrity, you want them dumb and lazy.
If you could put 10% of your future earnings on one of your classmates, you would pick the one that’s most effective at working with people.  These are qualities that are elective.  If you could pick one to sell short, it would be the person that no one wants to work with.  You can elect to be the kind of person you want to be.      Look at those qualities of the two people you’ve selected (one long and one short).  They’re all qualities that you possess.  It’s like marriage.  If you want a marriage that’s going to last, look for someone with low expectations.  Don’t keep score.  Keeping score doesn’t build organizations, homes, etc.  I have never had one fight with Charlie.  When I took over Solomon I had to pick the best person to run it.  I interviewed 12 people for 15 minutes each and I asked myself, “Who would I go into a foxhole with?”  I never look at grades or where you went to school.  When I picked Deryck Maughan, he never asked me about pay or options or indemnity.  He went to work.

Chains of habit are too light to be felt until they’re too heavy to be broken.  In terms of picking people how do you lead your life in a way that I’d pick you…

It’s been over a week since Welcome Weekend, and Jean and I are still reeling from all of the adrenaline, hard work and excitement. Welcome Weekend is held annually for accepted students and is an awesome way for prospective students to get to know potential classmates, current students, faculty and staff. I can’t believe that after months of planning, it’s finally over! We had an incredible time getting to meet so many cool people. It was a pretty full weekend, with lots of eating, mingling and general fun. The theme of the weekend was “Kicking it New School.” Details of the weekend are below:

Ambassadors lining walls in auditorium

Friday:

· Optional Sessions: Optional information sessions kicked off the weekend and filled prospective students in on housing, health insurance and financial aid.

· Welcome: Julie Barefoot, Director of Admissions, and J.B. Kurish, Dean of the Full-Time MBA Program, welcomed everyone to Welcome Weekend 2009.

· Reception: Goizueta’s Cool Blue Nights, the evening reception, followed with delicious Southern fare like cheese grits and corn bread. YUM!

· Late Night: Prospective students and current students enjoyed Late Night at Front Page News, a great bar in Midtown.

Saturday:

• Welcome: Larry Benveniste, Dean of the Goizueta Business School, welcomed students to the second day of activities.
• Program Office Overview: Prospective students then received information from the Program Office about curriculum, important dates and scheduling during B-school.
• Round Robin Sessions: The Round Robin Sessions followed, where prospective students rotated through three sessions- Career Management Center (CMC), Student Life and a Ben & Jerry’s Case with Professor Peter Roberts.
• Lunch: Prospective students then broke into their assigned lunch groups with current students, where they could ask whatever questions they had about concentrations, school life, local hangouts, etc.
• Academic Concentrations: Following lunch, prospective students headed to sessions on Academic Concentrations. They choose two academic sessions to attend and interacted with lots of current students, professors, and great alums from across the country.
• Closing & Kegs: J.B. Kurish closed the day’s activities and dismissed students to a Goizueta tradition- Kegs! All prospective students received beer steins for use when Kegs kickoff in the Fall. Though the rain kept us out of Jenkins Courtyard, where Kegs is normally held, we had a great time drinking Blue Moon and Stella in the Coca-Cola Commons!
• Reception: The weekend officially closed with a fabulous evening reception at the Miller Ward Alumni House, where everyone was dressed to the nines!
• Late Night: And of course, what would Goizueta be without a Late Night? Prospective students and current students kept the party going at Hand in Hand, a staple Goizueta hangout in Virginia Highlands.

More happy full-time Ambassadors

I’d like to extend a very big THANK YOU to all of the prospective students who attended and to the over 120 volunteers from the Classes of 2009 and 2010. You all made this a weekend I will never forget! For those of us who couldn’t join us for the weekend, please feel free to contact Jean or me with questions regarding Goizueta or Atlanta.

-Ceili Cascarano & Jean Downing

Co-Chairs, Welcome Weekend 2009

Thanks to everyone who helped out with and attended Welcome Weekend 2009!  The weekend was extremely well organized, and a big success overall!

As part of our MBA program here at Goizueta, we have the opportunity of attending mid-semester international lead week module in spring. This year we had Dubai and Cairo, Brazil or China as options. And because my love for Asian food, Jackie Chan and long flights, I chose the latter. Around 30-ish of my classmates and I left Atlanta on the morning of 26th February to embark on this 16 day trip, and

landed at the Pudong Airport in Shanghai next day. The flight was long and boring; however, I carefully chose an exit row seat and hence was spared by any inconvenience generally caused by fitting a 6′3″ body into an airline coach class seat. We had a lot of fun on the flight, but after hours and hours of chatting, watching movies (btw, I happened to see two Hindi movies on a Delta flight from Atlanta to Shanghai. Is Bollywood so popular now days, or was it the Slumdog effect) and playing poker (my friends and I are prepping up from Macau), we were happy to finally get back on the ground.

From the first minute in Shanghai, we started to see why everyone was so excited about the country. Shaghai has become one of the most modern and advanced cities in the world, and one doesn’t need to go far to discover that. The airport is connected to the city by MagLev – the magnetically elevated train that reaches the top speed of 431 kmph, and covers a distance of about 30Km in 7 mins and 10 seconds. The ride was obviously short, but very exciting.

Maglev - goes upto 431 kmph

We finally managed to check in to our hotel at about 5PM local time i; the hotel was right in middle of the commercial district. The surrounding places were very bustling and there was a lot to see in and around that area. There were loads of departmental stores, and other interesting stuff, and a popular nightlife destination, The Bund, is a few minute’s walk away. We had our dinner in a local Chinese restaurant, and the food was, let’s see how I put it kindly…, Interesting.

The next day we started our tour with a visit to the Shanghai World Financial Center, the tallest building in the world open for business. The design of the building is unique and the visit to the top floor was very entertaining as well. As you wait for the elevator to go up, the height at which the elevator is currently, is shown on the ceiling. And the floor is lit up with dancing lights. It was really catchy, and there were short light n music effects while you spend about a minute to travel 470m up in the air. Unfortunately, the view from the top wasn’t that great because of the fog and clouds. But, one could still see the Oriental Pearl Tower and the Jin Mao building, and the skyline of Shanghai looked very impressive.

Our guide, Allan, told us that everything around the old town was built within the last 20 years or so, which makes this development even more impressive. The city also has an urban planning museum, where a 2000sqm futuristic model of the city which reflects the government’s vision for this port city.

Urban Planning Museum

In the afternoon we headed towards the Yuyuan Garden and the old city. The place is right in the middle of the city, and it’s hard to imagine how authorities have managed to save the ancient architecture and old look of the buildings with so much of modern development going on all around it. In fact the local authorities constructed some old fashioned buildings around the garden just to preserve the look of the place.

Old Town

See the above picture and guess which building was built earlier. you’d be surprised to know that the one in the background is an older one!

And then we went to a place called French Concessions, a nice little neighborhood with European architecture and pretty good bars. We bar hopped for some time, played roulette when it came to paying checks (and I learned that game the hard way, by winning it, and therefore ended up paying first one). I tell you, it was not a lot of fun winning the game.

For the night we had a very interesting pub in mind. Bar Rouge is an amalgam of European and Asian feel. Loud Euro music, expensive drinks and a lot of people dancing till wee-hours in the morning is exactly what we had hoped for, and we enjoyed every bit of our night there. I remember coming back to the hotel around 4am, but that is just a guess. The next morning we had Ted Hornbein from Richco speak to us about the way business is done is China and the challenges American firms face. One of the most exciting points he presented was about notion of China as a low cost manufacturing destination, and how that is no longer true. He also talked about some recent trends in China, and how the government now wants to move the country from an assembly model to a more high skilled design and production hub, and what are the challenges in achieving these long term goals.

Later we visited the Shanghai Port, located at about 2 hrs drive from our hotel. The port is built on a reclaimed island, connected to the city by a 31.5 KM long bridge, 3rd longest in the world. And it is HUGE. We spent some time understanding how the port works and how efficient it is. It is amazing how quickly the port was developed, the land was acquired about 5 years ago, and now it’s one of the world’s modern engineering marvels.

Shanghai Port

Then we flew to Hong Kong for our trip to the south end of the country, and I was expecting a lot of fun and excitement from our four day stop visiting HK & Macau. I felt HK was much more like Mumbai; on the water, crowded, always on the move, and “happening”. There are loads of people everywhere, and due to the colonial history of this city, the mix of people is more diverse as compared to any other Chinese city. The first night we tried some local food in a restaurant called Jade Garden, easily one of my best meals on this trip. And after the dinner and couple of stops at random bars, we finally stopped to my favorite place in town, a classic British bar “Bulldog’s” on the Kowloon Island. As a big fan of live music, I really enjoyed my time, often singing with the band, and most of the times requesting songs that the band didn’t knew (most of them were classic rock hits that I thought they should know). In fact I so wanted to listen to one of the songs, that I sang it on stage with the band. And somehow everyone seemed to like it. So Oasis’s Wonderwall became my karaoke song for the rest of the trip.

Bulldog's - Hong Kong

The next day, we visited the American Chamber of Commerce in the heart of business district in HK, and met representatives from AmCham and US Commercial Services. The speakers talked about how the two associations are helping US businesses get acquainted with the Chinese government, culture and markets. It was very interesting to know that any exporter from US could walk in to a USCS office in America, and make use of the services provided by the office and start doing business in China. Of course it sounds easier than it actually is, but it is good to know that even small and medium business can take help from these associations to grow globally.

One of the most exciting visits on our tour was the visit to The Venetian, in Macau. The presentation was hosted by the Strategic Marketing Department of the casino, and we were given some insights into how they manage their resources to become more cost effective without compromising on the customer experience. It was a very unique experience to understand the cultural differences when it comes to gambling, and how the casino has adapted to the market needs. The presentation ended with a tour of the casino, and later, some gambling enthusiasts tried their luck in the casino.

Our final destination on the trip was Beijing, the capital city of China. After a nervy take-off, and long and boring 4 hour flight, we finally reached the hotel, which had definitely the best rooms on the whole trip. The recommendations from the lonely planet guide, and Frommer’s proved to be really helpful, and hence we tried some more local hangouts mentioned in the tour guides, and they didn’t disappoint. “Serve the People” is one of the best restaurants in town serving Thai food, and was another “must-go-to” restaurant in our list.

Our sightseeing tour in Beijing started with the Forbidden City, the Olympic Sites and Hutong. Beijing was different from either Shanghai or Hong Kong in a sense that it was more spread out and definitely more diverse. The next day we visited the local Home Depot store in Beijing. The management team was very excited to have us at the premises, and after a brief tour of the store, we were given a presentation about the many differences in the business model for China as compared to US, and the market dynamics. The business model for Home Depot, Do It Yourself or DIY, is no more applicable in China. Instead, it is now “Do It For Me”, or DIFM. Since the labor costs are so low in China, it makes more sense for people to just hire laborers to get the work done. Hence, HD is adapting to the needs of the local markets to grow, and the going hasn’t been that easy. However, now the management is aware that the learning curve is steeper than they initially thought, and hence are studying the market in more detail before taking their next steps.

Our team at Home Depot, Beijing

In the tail end of our trip, we visited the Great Wall. For me, this was the most exciting day of the trip. We were amazed by the vast spread of the wall through the mainland, and spent most of the day walking on the wall. Equally exciting was the slide on the way down, which made our day even more fun.

Finally, we flew back to Atlanta via Shanghai on Friday, the 13^th (ominous no?). To make our return journey more interesting, the entertainment units in the flight chose not to work. Thankfully my exit row seats came in handy; I made the best use of it, and slept through the flight. All in all, I’m so glad I went on the trip, and I am certainly looking forward to another trip to China in the future!

Where is the biggest soccer stadium in South America? Which cosmetic company produces 2 million lip balms per hour? Which city is the third biggest city in the world? Have you heard of Google Mars?

Nearly 40 Goizueta Business School students found the answers to these questions during a trip to Brazil in March, 2009 for an international lead week. The lead week is supported by our dean, JB Kurish, who said, “Our students have been willing to spend money to go to places where they can have an enriching experience. It would be very disappointing if, because of economic forces, students felt they could not afford to go overseas.”  (http://www.businessweek.com/bschools/content/mar2009/bs2009035_357853.htm)

The biggest stadium in South America

We visited Petroleo Braileiro, an integrated oil and gas company, and learned about the company’s investing plans and the energy difficulties in Brazil. The presenter talked about the scarcity of the oil in Brazil in early 1990 and how much effort Prtroleo put into exploration and production to obtain the success they have today. However, they are also thinking about branching out internationally through a different distribution model. Even though they are observing the huge Brazilian market, Petroleo wants a bigger piece of the pie.

While in Brazil, we of course took the advantage of the most famous beach in Rio – Ipanema!!! The beautiful sunshine and the combination with the blue water amazed me. I know some people in our group basically spent one whole day on the beach and got sunburned and pealed, but still enjoyed it. Lying down and people watching around is huge fun as it is, not to mention drinking plenty of beer and coconut water, which refreshes you from the heat.

Ipanema Beach

If you go to library e-resource, you will find that Vale do Rio Doce is a metals and mining company, which may not sound terribly exciting. However, the moment you start talking to people in the company you feel their passion about transforming the world, instead of the cold metal materials, they talk about education, life and safety, and transforming mineral for everyday life!! The reality is that before every meeting in Vale, the speaker or presenter spent around 5 minutes explaining where the emergency exits are, isn’t that interesting?

Exploring restaurants was one of our missions as well. Brazilian people love meat and sometimes I wonder how many cows the whole group ate per night. My guess is that it was near 30. It was always all you can eat, and the Brazilian organizers always make sure that we were very hungry before going into the restaurant!

We also visited Natura, the leader of Brazilian cosmetics market, which has a fascinating factory. In 2007, they produced around 180 new products to fulfill their customers’ needs. With so many different products and customers, their picking system is complicated but at the same time efficient. I, however, was most impressed by the scenery around the factory – the grass field, the green hills and the sunset.

Factory

Sau Paolo, the city with afternoon shower, has around 15 million in population. The not stop night clubs and restaurants are generally the “tourist” places. Although we didn’t spend too much time on the city tour, it was all worth it when we found the most delicious tiramisu in an Italian restaurant (ya, the Brazilians and the Italians have to find a place to stay together peacefully).

Google Brazil, no need for me to explain what they do, has the most relaxing atmosphere you can possibly image. You can play pool, Guitar Hero, Rock Back, Wii, and even lay down somewhere while at work. One thing special about this Google office is that pets are NOT allowed here!! In every other Google office pets are allowed, but not this one because of the rules in the building. The funny thing is that Google Brazil even fought for that but they didn’t succeed.

Google

I considered this trip my graduation trip, maybe the international lead week sounds more official, but it was wonderful for me. Thanks to our classmates who organized the whole trip, the whole group could enjoy so much. This, again, shows the leadership spirit at Goizueta. If you want to organize a trip to your home country, home town, or somewhere else, just propose it to the program office, and you can do it, and at the same time, bring so much joy to the whole community!

Joe and I broke into a sprint as we left Georgia Tech’s architecture school and raced to my car. We were rushing to mail our submission for the Urban Land Institute’s Hines Urban Design Competition before the deadline that day. Some trivial last-minute revisions held us longer than desired, but for now I could only focus on salvaging our effort. In my head I traced a route to the UPS Store: Tenth Street would be faster. No, definitely Sixth then Peachtree. Whichever way, we were in a serious hurry; my heart pounded a steady staccato as I watched the time vanish.

This was the frenzied denouement of a fortnight spent working on the Hines competition, a real estate challenge endowed by renowned developer Gerald D. Hines. Last October, Joe, a friend of mine in the MBA program at Georgia State, alerted me of the contest and asked if I wanted to participate. Truthfully I didn’t really take a close look at the competition criteria before agreeing to do it, but two items did pique my curiosity: Teams are required to have five graduate students representing at least three different degrees, and the winners receive $50,000. We set off to recruit potential team members and ended up with two architecture students from Tech and Joe’s ex-classmate, an urban-planning student from Florida.
When the challenge arrived, it quickly became obvious that this competition would be nearly impossible without a multi-discipline squad. The ULI charged the participating teams with crafting a 10-year development plan for a 75-acre site south of downtown Denver and demonstrating how it will adapt to lifestyle preferences in the year 2050. We had 14 days to devise a strategy, illustrate the utility and aesthetic appeal of our concept and bring it to life with financial projections showing a healthy economic pulse. The complexity and breadth of this challenge dwarfed anything I had ever seen in traditional business case competitions, which now seemed rather two dimensional.

If it sounds like a lot of work, well, it was. Rumors circulated that some schools give their teams a two-week hall pass to focus exclusively on the Hines contest. Although we didn’t have that luxury, we did share a mutual commitment to producing a winning entry. When we met to brainstorm a strategy, a fervent discussion ensued on everything from the turn radius of our parking decks to the feasibility of dressing the entire district in vegetation. (That wasn’t exactly what I envisioned when we talked about green building, but I’m just the number cruncher, what do I know?) Perhaps our creative capacity was a bit excessive: We applauded every novel idea until our site bulged with the world’s next 27 architecture wonders. Passersby probably thought we were designing an amusement park.

Eventually we settled on a plan and set off to work independently. The designers, Ross, Paul and Marcio, drafted site diagrams and cross sections of buildings, while Joe and I pored over market data and heaped together a colossal pro forma for our 30-some proposed structures. Our concept gradually took shape as we stitched together each component; after an exhausting 24-hour layout session, we anxiously watched the printer deliver our masterpiece.

Yes, we did make it to UPS in time and bellowed cries of relief when our package disappeared into the shipment bin. This week, the ULI announces which four finalists will travel to Denver and pitch their proposals in April. Although the contest has been largely dominated by Ivy League teams in years past, we are optimistic about our motley collection of grad students and the extraordinary submission we produced. It added grandeur to fantasies about frolicking in $50,000 of cash before thousands of envious onlookers. Let’s hope it becomes a reality.