CEO Magazine - Volume 22 by CEO Magazine

C E O M AG. C O. U K

SPRING 2016

TECHED

KENT STATE GOES BIG ON BIG DATA ceomag.co.uk / Spring 2016

FROM SILICON VALLEY TO BIG BUSINESS

THE CYBER SECURITY MBA

FOUR KEYS TO MARKETING IN THE DIGITAL ERA 1

ACHIEVE YOUR MASTER’S IN BUSINESS ADMINISTRATION AT CALIFORNIA STATE UNIVERSITY, SAN BERNARDINO

DID YOU KNOW...  Less than 5 percent of the world's business schools have accreditation from the Association to Advance Collegiate Schools of Business (AACSB) - CSUSB’s College of Business and Public Administration is proud to be one of them!  Our MBA professors are EXPERTS in their fields, bringing high quality professional experience to the classroom.  Thanks to the MBA program’s innovative BOOTCAMP curriculum, all majors are welcome. These free online boot camp modules are designed to enhance the student’s academic career throughout his/her MBA program.  CSUSB's MBA is more affordable and provides a greater return on INVESTMENT when compared to other MBA programs. The College of Business and Public Administration at CSUSB transforms today’s business talents into tomorrow’s global LEADERS!

ceomag.co.uk / Spring 2016

Contents

FOUR KEYS TO MARKETING IN THE DIGITAL ERA Dominique Turpin

10 12

DISRUPTING EDUCATION: ÉCOLE DES PONTS’ NEW PROJECT-BASED MBA Alon Rozen

MBA RANKINGS CEO Magazine

16 ceo-mag.com / Spring 2016

INTEGRATING DIGITAL INTELLIGENCE INTO BRAND STRATEGY David Dubois

Contents

THE CYBER SECURITY MBA BRINGING NEW TOOLS TO THE BOARDROOM Craig Seal and Tony Coulson

TEN COMMANDMENTS’ OF CYBER SECURITY CAN ENHANCE SAFETY Knowledge@Wharton

WHAT HAVE DIGITAL AND SOCIAL MEDIA DONE TO YOUR STRATEGY? Misiek Piskorski and Carlos Cordon

KENT STATE GOES BIG ON BIG DATA O. Felix Oﬀodile

30 ceo-mag.com / Spring 2016

WHY CHOOSE OLD SCHOOL, WHEN THERE’S NEW SCHOOL?

Join Australia’s largest MBA provider* Study via distance learning and complete the top ranked AIB MBA in as little as 12 months or up to 3 years – the choice is yours.

www.aib.edu.au ceo-mag.com / Spring 2016 * According to Australian Department of Education and Training data and student enrolment numbers published in an article in the Australian Financial Review (September 2015).

Contents

THE ROAD TO THE EMBA Francis Petit

THE COLLABORATIVE WAY TO MASTER YOUR MBA Australian Institute of Business

42 4

DIGITAL HAS KILLED THE STRATEGIC PLAN Chris Outram

FROM SILICON VALLEY TO BIG BUSINESS ISEG Lisbon - School of Economics and Management

ceo-mag.com / Spring 2016

Contents

MANY ENTREPRENEURS DON’T NEED SUBSIDIES Alina Dizik

48 6

EVOLVING LEADERSHIP IN THE DIGITAL AGE Manfred Kets de Vries

LIST OF CONTRIBUTORS

ceo-mag.com / Spring 2016

CEO Victor J. Callender Group Editor-in-Chief Alexandra Skinner Design & Illustration pentacreate.com Financial Controller Anthony Gordon

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Head of Production Steven Whitaker Features Writer Amber Callender

@ceo_mag

/CEOMagazineGlobal

Published by CEO Magazine. All rights reserved. No part of this publication may be reproduced without the expressed approval of the copyright owner. Whilst every eďŹ&#x20AC;ort has been made to ensure the accuracy of the information in this publication, the Publisher accepts no responsibility for errors or omissions. The Publisher disclaims responsibility for the views and opinions expressed herein by the contributors. Furthermore, the Publisher does not give any warranty regarding the accuracy thereof. For further information on annual subscription rates visit: www.ceo-mag.com

THE FORDHAM EXECUTIVE MBA Earn a gold-standard credential in just 22 months. Classes meet 1 weekend per month. Study with a close-knit cohort of experienced professionals who will build your network. LEARN MORE: FORDHAM.EDU/EMBA

ceo-mag.com / Spring 2016

Digital Marketing

“More than ever, to become an effective marketer in the digital era, you need to think like your customers, go where they go, let them do the talking and improve their experience.” “While the average purchase value on Pinterest is $USD 175, it drops to $80 on Twitter. Is that worth the extra effort for your business? It’s up to you to decide.” “To invent their wildly successful products, Apple didn’t ask what their customers wanted, it focused on what their problems were.”

FOUR KEYS TO MARKETING IN THE DIGITAL ERA In today’s digital era, consumers have a completely diﬀerent journey than they used to. DOMINIQUE TURPIN, PRESIDENT OF IMD

hat we marketers call the ‘marketing funnel’, where at the top consumers become aware of the product through marketing, then express interest in the middle before purchasing at the bottom, is obsolete. The new model is called the customer decision journey, a term coined by McKinsey & Co. Now a customer can spot a friend with a new product on Facebook or come across it on Pinterest, then decide to buy it based on hundreds of customer reviews on Yelp, Amazon, or TripAdvisor. Some people might even watch a video blogger testing a product on YouTube. Once a potential buyer has sifted through the reviews, they can buy the product on WeChat or even Twitter now. Then they review the product online, tweet pictures of themselves with it, tell their friends about it on Facebook and on and on. So if customers are finding out about their products from each other, and perpetuating this decision loop, what can we marketers do?

1 Privatise customer-centricity! This was number one in traditional marketing and it’s still number one in the digital era. Focus on your customer’s major “headaches” rather than their needs. Spend a day in the lives of your customers to find out how to make their lives easier, better, cheaper. To invent their wildly successful products, Apple didn’t ask what their customers wanted, it focused on what their problems were. Give your customers more instead of cheapening the offer. And don’t just focus on customer satisfaction—build retention and loyalty.

2 Meet customers wherever they go Let’s look at how much time consumers spend online and where, based on research by IMD Professor Misiek Piskorski, author of the book “A Social Strategy”, a study of how companies profit from social media. According to Misiek, Pinterest users are 70 per cent female and nearly a third of them have a household income over $USD 100,000 per year. Almost half are over 35 years old, and on average they spend 16 minutes on Pinterest per day versus 12 minutes daily on Facebook. This is important, because nowadays five per cent of referral traffic to apparel websites comes from Pinterest. Therefore, if you are an apparel company, you have to be on Pinterest! Digital marketers need to know where their customers are spending time online and meet them there. However, being on the most popular social media site in your sector is not enough; companies need to be on as many of the sites, apps and channels as they can where their customers are spending the most time. They also still need to be number one on search engines, regularly e-mail customers and potential buyers, and provide them with high quality content. Moreover, companies can’t be everywhere and they have to focus their attention where it is the most valuable. While the average purchase value on Pinterest is $USD 175, it drops to $80 on Twitter. Is that worth the extra effort for your business? It’s up to you to decide. ceo-mag.com / Spring 2016

3 Let somebody else do the talking When you can’t be everywhere, let your customers be your ambassadors. In some sectors, like mobile phone service for example, word of mouth still reigns supreme. In a survey cited by Misiek, 40 per cent of the people polled said that they chose their service provider based on recommendations by family and friends. Only per cent chose their provider based on a recommendation from social media. This means that if your customers are satisfied or delighted, they are likely to recommend your product to those around them. But how to delight your customers or clients? 4 Master the experience stage The best way to turn happy customers into ambassadors online is to make them feel great and special about using your products. Companies like Nike have used digital technology to really enhance the post purchase experience for their customers, increasing their loyalty and making them more likely to be brand advocates. Nike is a great example of how to holistically harness digital transformation. For a while now, the company has been putting fitness tracking chips in its shoes which allows their wearers to monitor their progress and share it with friends on popular social sites like Facebook, but also Nike’s anuncio CEO Magzine meia pagina ao baixo.pdf

22/02/16

own social network. Not only can people analyse their progress and show off , they can also fi nd running routes and interact with others. For Nike, the massive amount of data collected thanks to these tracking chips allows them to monitor how long customers wear their products and let them know when they need new ones. They also can use the information to improve their shoes to stay ahead of the competition. The new digital era is transforming marketing as we know it. But it doesn’t mean just setting up a Facebook page a nd hopi ng for li kes. Digital transformation affects every part of an organisation and its marketing. Is your company on the right path, or do you need digital transformation? More tha n ever, to become a n effective marketer in the digital era, you need to think like your customers, go where they go, let them do the talking and improve their experience.

BIOGRAPHY Dominique Turpin is the Nestlé Professor and President of IMD. He co-directs IMD’s Orchestrating Winning Performance program, the next edition of which takes place in Lausanne on June 27th to July 1st. ACKNOWLEDGEMENT Courtesy of IMD.

12:03

ISEG MBA

PROGRAMME

ceo-mag.com / Spring 2016 marketing@iseg.ulisboa.pt

MBAs

“Actually, the accreditation agencies are becoming increasingly open to innovation in format, pedagogy and delivery, so I am sure that they will be very enthusiastic about our approach.” “Instead of spending a week in class with a given professor, we are asking each professor to ‘design’ a week in which no more than three days are actually held in the classroom.”

DISRUPTING EDUCATION: ÉCOLE DES PONTS’ NEW PROJECT -BASED MBA

Alexandra Skinner speaks to Alon Rozen, Dean of École des Ponts Business School

lexandra: Well Dean Rozen, let’s get right to the point, what innovations are you planning for 2016-2017? Alon: Well, in a nutshell, we plan to revolutionise the full-time MBA programme in order to move away from the standard approach to an exciting new approach we are calling the “project-based MBA”! Alexandra: That does sound exciting, but what does that mean in practical terms? Alon: As you know, MBA programmes are typically built on a sequential stream of classes that go from the basics to more advanced courses in business and management, with one or two integrative projects thrown in for good measure to allow MBA students to apply what they learned in the classes in practice. We are turning the programme design on its head and creating an MBA that is based on projects that will act as the backbone to the entire programme with classes serving the projects. Five projects will run across the academic year with programme credits divided 50/50 between projects and courses. Alexandra: Can you be more speciﬁc as to what kind of projects you are referring to? Alon: Next year the MBA will include five projects. The fi rst is a social impact project, where participants will be working either on social entrepreneurship initiatives or working to solve real-world

social challenges. The second is a consulting project where participants will have to audit a company, identify the key strategic challenges facing the company, and make strategic recommendations to the top management or board of the company. The third is a product-tomarket challenge where the MBA participants will have to design an innovative product and then launch a crowdfunding project to fi nance the production and commercialisation of the product. The fourth is a ‘hack an app’ challenge where participants will create and market a smartphone application. The fi fth project is a start-up challenge where participants will pitch their start-up ideas in front of potential investors during a ‘demo day’. Alexandra: This sounds very modern. Are you worried that it might be too modern for the accreditation agencies who are used to accrediting a more standardised approach to the MBA? Alon: Actually, the accreditation agencies are becoming increasingly open to innovation in format, pedagogy and delivery, so I am sure that they will be very enthusiastic about our approach. All major international accreditation agencies, including AMBA, which accredits our MBAs, have moved to programme mapping grids that favour integrative courses and there is nothing more integrative than these type of field-based learning experiences. Alexandra: Okay, so maybe you can explain how one of these projects will actually work. Alon: First of all, you should know that we already added ceo-mag.com / Spring 2016

an integrative field-based learning project to our full-time MBA this year in order to test the concept. At the end of March our MBAs spent a week in Bordeaux for the kick-off of our first ever product-to-market challenge. The MBAs were given the challenge of creating a class wine and launching their own Kickstarter project to get the funding to blend, bottle and sell their wine. It was amazing! They learned all about the wine business, met winegrowers, winemakers, wine distributors, visited a winery and a vineyard, and met with several wine startup founders to see how other Bordeaux-based innovators were trying to disrupt the wine industry. They then worked in groups to design four different innovative wine projects, learned how to blend, and then blended their own wines to go with each project. This was followed by a blind tasting competition to see which of the four blends they’d created was the most popular. They also negotiated with the wine suppliers, designed their own wine labels, and then decided on which project to pursue as a class. Alexandra: That sounds incredibly fun and a great excuse to drink lots of wine, but is it a great learning experience beyond wine? Alon: More than you can imagine. At the beginning of the week we asked them to think about what makes wine so special as a product, a beverage, a market and a business and why wine marketing is so difficult. In addition to learning the answers to these questions, they gained insights on new approaches to segmenting markets, the pros and cons of different pricing strategies, how global markets work, the importance of intermediaries and distributors in retail channels, insights into B2B and B2C segments, they learned about structured approaches to innovation and, also, how difficult it is to truly create a disruptive innovation in any industry. In terms of learning, it is a total immersion in the wine sector, but it is especially poignant as a learning experience applicable to many global or globalising markets. Alexandra: So, what did the participants think about this experience? Alon: It was actually kind of a strange feeling for me, as I have never been thanked so enthusiastically by such a large number of participants for including a course in the curriculum. In a word, the feedback from the participants has been incredible – “an amazing learning experience”, “such a refreshing change of pace”, “ an eye-opening experience”, “this is how all classes should be held” are just some of the spontaneous testimonials we heard at the end of the week. That said, a few of our participants did admit that they preferred beer over wine, so maybe we’ll look into craft beer for a future challenge. Alexandra: So is that how all classes should be held? Alon: Well, I’m not sure that all classes can be held ceo-mag.com / Spring 2016

like this, but the idea is to get our students outside of the classroom as often as possible – for projects, for study trips, and even during regular classes. Alexandra: Even for regular classes? Alon: Yes indeed! We are trying a new approach with our classes next year too. Instead of spending a week in class with a given professor, we are asking each professor to ‘design’ a week in which no more than three days are actually held in the classroom. Professors are encouraged to integrate field work, corporate visits, inverted classroom approaches, blended learning using MOOCs or online sources, and other innovative approaches so that the in-class experience is more oriented towards facilitation, projects, presentations, debriefing of case studies and the like. The heavy lifting of learning the theory should not be done in the classroom, while the class should be a forum for confronting experiences, debating ideas and exploring the depths and tangencies of a given subject matter. And, in regards to our new programme design, the class should be used to support the participants in achieving success in the ongoing project. For example, participants will be studying strategy and finance while they are working on their consulting project. Thus, the strategy professor will be asked to include strategic due diligence in the course, while the finance professor will focus specifically on financial statement performance analysis as related to the project(s) the participants are working on at the time. This is a very different approach to MBA design that we are particularly proud of.

“Another, potentially surprising, source of inspiration for us are start-up accelerators. If we consider a startup as a project, accelerators often offer the equivalent of classes in support of the start-up project.”

Alexandra: So what was the inspiration for this new approach? Alon: The overall approach seems to be quite unique on the MBA landscape as far as we can see, however, several sources of inspiration helped to shape the new approach. A first source of inspiration is the ongoing reform at our alma mater, the École des Ponts ParisTech, which is part of the French grande école system (similar to the Ivy League of elite schools). They are changing the curriculum to be more project-based and we felt it was important to maintain a coherent pedagogical ‘flavour’ between the business school and the engineering school. We also spent time studying different project-based models, like that offered by Olin College in the Boston area. Like us, they are a small, quality-oriented school, and they have implemented a very original project-based approach at the undergraduate level we felt could be an interesting model at the graduate level. Another, potentially surprising, source of inspiration for us are start-up accelerators. If we consider a start-up as a project, accelerators often offer the equivalent of classes in support of the start-up project. We felt that an MBA should feel more like an accelerator and less like a standard academic programme. 11

MBAs

2016 MBA RANKINGS

Regardless of whether you’re pursing an MBA to broaden your current skill set, climb the ladder or launch a start-up, it’s probably safe to say that you’ve done a lot of thinking, weighing and measuring: time, money, eﬀort, outcomes etc.

o, having decided to take the plunge, all you have to do now is choose the right school which, in theory, shouldn’t be that difficult. If you have an idea of the delivery you’re looking for (full-time, part-time etc.), the budget you have to work with, and the geography you’d consider (see our MBA search tool at www. ceo-mag.com) you’ve gone some way to narrowing the field, which is a great start. However, not all MBAs are created equal, which makes putting together a shortlist a lot more challenging, but this

is the point at which we can help. We look beyond the marketing brochures and ad campaigns and examine the nuts and bolts of an MBA: the learning environment, class sizes, tuition fees, faculty, delivery methods, international diversity, gender make-up and more. Our objective is simple: to identify schools which marry exceptional quality with great ROI. The results, or ‘rankings’ as we call them, can be viewed below, and should help to provide that quality benchmark.

NORTH AMERICA TIER ONE American University: Kogod Auburn University Boston University: Questrom Bryant University California State University-Chico California State University-Long Beach California State University-San Bernardino California State University-East Bay Case Western Reserve University: Weatherhead Chapman University: Argyros College of William and Mary: Mason** Colorado Technical University Drexel University: LeBow** Florida International University Fordham University Georgetown University: McDonough Georgia State University: Robinson 12

Gonzaga University HEC Montreal Hult International Business School Jacksonville University Kennesaw State University: Coles Kent State University Loyola Marymount University Loyola University Chicago: Quinlan Lynchburg College Marquette University Mercer University-Atlanta: Stetson Millsaps College: Else Niagara University Northern Illinois University Pepperdine University: Graziadio Purdue University-West Lafayette: Krannert* ** Queens University of Charlotte ceo-mag.com / Spring 2016

Rensselaer Polytechnic Institute: Lally Rochester Institute of Technology: Saunders Seattle University: Albers Saint Joseph’s University: Haub Saint Mary’s College: School of Economics & Business Administration Temple University: Fox Texas A&M University-College Station: Mays Texas Christian University: Neeley University of Alberta University of California at Berkeley: Haas University of California at Davis University of California-San Diego: Rady University of Cincinnati: Lindner University of Colorado-Colorado Springs University of Connecticut University of Delaware: Lerner** University of Hawaii-Manoa: Shidler University of Louisiana-Lafayette: Moody

University of Massachusetts-Boston University of Massachusetts-Lowell University of Michigan-Flint University of North Carolina-Charlotte: Belk** University of Notre Dame: Mendoza University of Oklahoma: Price University of Oregon: Lundquist University of Pittsburgh: Katz University of Richmond: Robins University of South Florida: Muma University of Tampa: Sykes* ** University of Texas-Dallas: Jindal University of Utah: Eccles University of Vermont: Grossman University of West Georgia University of Wisconsin-Milwaukee: Lubar Virginia Commonwealth University Virginia Tech: Pamplin Willamette University: Atkinson

TIER TWO Appalachian State University Boston College: Carroll* ** Bowling Green State University Cleveland State University: Monte Ahuja Fairfield University* Iowa State University Northwest Missouri State University Oakland University University of Akron University of Baltimore*

University of Florida: Hough University of Kentucky: Gatton University of Nebraska -Lincoln University of Nevada-Las Vegas: Lee University of North Carolina-Wilmington: Cameron University of Notre Dame: Mendoza* ** University of Washington: Foster Wake Forest University Washington State University: Carson

EUROPE TIER ONE Aston Business School Audencia Nantes Birmingham Business School Brunel Business School Business School Netherlands Carlos III University of Madrid Copenhagen Business School Durham University Business School École des Ponts Business School ESADE Business School EU Business School

AUSTRALIA

HHL Leipzig Graduate School of Management IE Business School IESE Business School ISEG Lisboa School of Economics & Management LISBON MBA MIP Politecnico di Milano Porto Business School SBS Swiss Business School Solvay Brussels School of Economics and Management

Toulouse Business School Trinity College Dublin School of Business UBIS University of Amsterdam University of Exeter University of Liverpool Management School University of Sheffield Management School

TIER ONE 1 Australian Institute of Business 2 Victoria Graduate School of Business 3 University of Wollongong ceo-mag.com / Spring 2016

Sydney Business School 4 University of Southern Queensland =5 Central Queensland University =5 Griffith University

6 RMIT University 7 Deakin University

MBAs

RANKINGS GLOBAL EMBA TIER ONE

AIX Marseille Graduate School of Management Europe Auburn University North America Audencia Nantes Europe Australian Catholic University Australia Boston University: Questrom North America California State University-Long Beach North America California State University-East Bay North America Case Western Reserve University: Weatherhead North America CENTRUM Católica Graduate Business School South America Chapman University: Argyros North America College of William and Mary: Mason** North America Copenhagen Business School Europe École des Ponts Business School Europe ESADE Business School Europe EU Business School Europe Florida International University North America Fordham University North America Georgetown University: McDonough North America Georgia State University: Robinson North America HEC Montreal North America HHL Leipzig Graduate School of Management Europe Hult International Business School North America IE Business School Europe IESE Business School Europe IfM Institut für Management Europe Jacksonville University North America Kedge Business School Europe Kennesaw State University: Coles North America Kent State University North America Lorange Institute of Management Europe Loyola Marymount University North America Maastricht University Europe Marquette University North America Mercer University-Atlanta: Stetson North America Millsaps College: Else North America MIP Politecnico di Milano Europe Northern Illinois University North America Pepperdine University: Graziadio North America Porto Business School Europe Queens University of Charlotte North America RMIT University Australia Rochester Institute of Technology: Saunders North America Rutgers Business School North America Saint Joseph’s University: Haub North America

Saint Mary’s College: School of Economics & Business Administration North America SBS Swiss Business School Europe Solvay Brussels School of Economics and Management Europe Stockholm School of Economics Europe Technische Universität München (TUM) Europe Temple University: Fox North America Texas A&M University-College Station: Mays North America Texas Christian University: Neeley North America Trinity College Dublin School of Business Europe UBIS Europe University of Alberta* North America University of California at Berkeley: Haas North America University of California-San Diego: Rady North America University of Exeter Europe University of Hawaii-Manoa: Shidler North America University of Kentucky: Gatton North America University of Nevada-Las Vegas: Lee North America University of Notre Dame: Mendoza North America University of Oklahoma: Price North America University of Oregon: Lundquist North America University of Ottawa: Telfer North America University of Pittsburgh: Katz North America University of South Florida: Muma North America University of Texas-Dallas: Jindal North America University of Utah: Eccles North America University of Washington North America University of Wisconsin-Milwaukee: Lubar North America University of Wollongong Sydney Business School Australia Virginia Commonwealth University North America Washington State University North America Bowling Green State University North America Cleveland State University: Monte Ahuja North America Drexel University: LeBow** North America Loyola University Chicago: Quinlan North America Oakland University North America Seattle University: Albers North America University of Connecticut North America University of Florida: Hough North America University of Louisiana-Lafayette: Moody North America University of Tampa: Sykes* ** North America Virginia Tech: Pamplin North America

ceo-mag.com / Spring 2016

GLOBAL ONLINE MBA Rank School 1 EU Business School 2 SBS Swiss Business School 3 UBIS 4 Durham University Business School =5 Queens University of Charlotte =5 EuroMBA =5 Australian Institute of Business =6 IE Business School =6 The Open University 7 University of Utah: Eccles 8 Temple University: Fox 9 CENTRUM Católica Graduate Business School 10 Aston Business School =11 Pepperdine University: Graziadio =12 Georgia WebMBA =12 Jack Welch Management Institute =12 Rochester Institute of Technology: Saunders =13 University of Massachusetts-Lowell =13 Griffith University 14 Colorado Technical University 15 California State University, San Bernardino

Region Europe Europe Europe Europe North America Europe Australia Europe Europe North America North America South America Europe North America North America North America North America North America Australia North America

Rank School Region =16 Mercer University-Atlanta: Stetson North America =16 Saint Mary’s College: School of Economics & Business Administration North America 17 Deakin University Australia 18 St. Joseph’s University: Haub North America 19 RMIT University Australia =20 University of Cincinnati: Lindner North America =20 MIP Politecnico di Milano Europe =20 Central Queensland University Australia =21 University of Colorado-Colorado Springs North America =21 Washington State University North America 22 University of Delaware: Lerner** North America 23 University of Texas-Dallas: Jindal North America 24 Florida International University North America 25 Drexel University: LeBow** North America 26 University of Baltimore* North America 27 University of Nebraska -Lincoln North America 28 Auburn University North America 29 University of Florida: Hough North America 30 Cleveland State University: Monte Ahuja North America 31 Northwest Missouri State University North America

North America

GLOBAL EMBA TIER ONE Stockholm School of Economics Europe Technische Universität München (TUM) Europe Temple University: Fox North America Texas A&M University-College Station: Mays North America Texas Christian University: Neeley North America Trinity College Dublin School of Business Europe UBIS Europe University of Alberta* North America University of California at Berkeley: Haas North America University of California-San Diego: Rady North America University of Exeter Europe University of Hawaii-Manoa: Shidler North America University of Kentucky: Gatton North America University of Louisville North America

University of Nevada-Las Vegas: Lee North America University of Notre Dame: Mendoza North America University of Oklahoma: Price North America University of Oregon: Lundquist North America University of Ottawa: Telfer North America University of Pittsburgh: Katz North America University of South Florida: Muma North America University of Texas-Dallas: Jindal North America University of Utah: Eccles North America University of Washington North America University of Wisconsin-Milwaukee: Lubar North America University of Wollongong Sydney Business School Australia Virginia Commonwealth University North America Washington State University North America

TIER TWO Bowling Green State University Cleveland State University: Monte Ahuja Drexel University: LeBow** Loyola University Chicago: Quinlan Oakland University Seattle University: Albers ceo-mag.com / Spring 2016

North America North America North America North America North America North America

University of Connecticut University of Florida: Hough University of Louisiana-Lafayette: Moody University of Tampa: Sykes* ** Virginia Tech: Pamplin

North America North America North America North America North America

Digital Data

INTEGRATING DIGITAL INTELLIGENCE INTO BRAND STRATEGY

As organisations seek to integrate the massive ﬂow of digital data into their brand strategy, they face a triple challenge to stay ahead. DAVID DUBOIS

W “Digital intelligence is more about smart data than big data.”

ith Google now processing over 40,000 search queries every second - a staggering 3.5 billion requests a day - data creation has exceeded imaginable levels. Managed well, this onslaught of information can be used to unlock fresh insights, build better policies and create new sources of economic value. These potential successes, however, depend on companies’ ability to respond to the new challenges associated with digital integration. To remain competitive, organisations – large companies, governments, political parties and associations – need to address the question of how they incorporate this digital tsunami into their value creation process. Who’s taking care of your digital data? T he c yber revolut ion requ i res d ig it a l integration, not digital acquisition. Yet, many companies still choose to outsource data listening and analytics capabilities and rely on external partners who specialise in gathering online data, to provide weekly or monthly updates about the changing digital landscape. At times, collaborators within the company may get access to dashboards that track online content, but usually they lack

the time, training and perspective that would allow them to successfully leverage digital data. Of even greater concern, companies don’t even ask themselves where or how they want to create novel value in the fi rst place. Understanding digital intelligence The gap between what digital intelligence involves and what brand leaders think it means stems from two major misunderstandings on the very nature of digital data. The first misunderstanding concerns the rhythm of digital information: this new data is continuous and real-time, from search to geolocalisation to social media and e-commerce data. If we look at companies as social bodies, then digital data represents the new lifeblood that flows outside of them from key stakeholders i nclud i ng con su mers, competitors a nd collaborators. Thus it is vital that companies become more agile in their response to the digital momentum. Corporations’ lack of integration, and their tendency to rely on infrequent updates from outside partners, is at odds with the fluid and ever-changing nature of digital data flow. This does not mean that outsourcing or thorough analyses of stocks of data is bad – in fact these are ceo-mag.com / Spring 2016

necessary to understand what’s happening in the long-term or have access to superior analytics capabilities; but the reality is, these companies often lack technical or strategic perspectives to put digital data into perspective. Smart data rather than big data The second misunderstanding is that digital intelligence is not so much about quantity but rather about the quality of information. Unfortunately the now popular buzzword “big data” emphasises and overvalues the magnitude of data. Successful digital listening relies less on how much information is heard and more on the quality of one’s listening approach and the extent to which this fits with what the brand aims to achieve. Brands need to think about the kind of value they aim to create before tuning their listening strategy appropriately. As an analogy, consider a cocktail party and how often it is more useful to direct your ears towards a particular conversation to get meaningful information, as opposed to trying to capture the overall sum of conversations around you. In short, digital intelligence is more about smart data than big data. This requires brands to be proactive, and not just reactive, regarding the kind of value they aim to create. 3 challenges to successful digital integration To successfully integrate digital intelligence into their processes, brands need to meet three key ceo-mag.com / Spring 2016

challenges: an operational challenge (how to know what to listen to); an organisational challenge (how to share in real time the digital information collected within the organisation); and a strategic challenge (how to systematically use digital insights in the process of creating value). n The first challenge - operational - seems easy to overcome. To work on it brands need to fi rst think

about how to link the desired outcomes (what are the objectives?) with relevant data sources (what type of media platforms or type of data are being accessed?). In some cases, geo-localised data will appear to be of primary importance. In other cases, when focusing on brand perceptions, social media mentions could outweigh other sources. Or, in cases where brands aim to predict whether a trend will garner more interest in the future, relying on search data may be the key. It is only after these objectives and sources have been identified that organisations should develop an external or internal system to synthesise the insights gathered. n The second challenge - organisational - involves

deciding which parties within the organisation will have access to this data; the terms of their access (such as frequency or training in digital listening); and how the data and insights will be shared within the relevant teams (such as the brand team). It is at this point that organisations often succumb to the temptation to rely solely on

“The ability to integrate digital intelligence gives companies a signiﬁcant edge in understanding and anticipating market movements.”

Digital Data

Acknowledgement David Dubois is Assistant Professor of Marketing at INSEAD. Republished with permission from INSEAD Knowledge, the expert opinion and management insights portal of INSEAD. Follow INSEAD Knowledge on Twitter and Facebook

an external provider. However it is now more than ever, that internal input is most vital. Only frequent discussions among company col laborators across d i f ferent ra n k s a nd functions coupled with external intelligence will fully reveal the potential of the data, and yield relevant analyses through the multiplicity of viewpoints and data interpretation. In service industries such as banking or tourism, giving access to monitoring tools to individual leaders running businesses (e.g. brand managers) is critical to help them track performance on a daily basis and address potential concerns. In fact, a few major brands in hoteling already track their hotels’ e-reputation, make their listening platform available to the hotel’s managers, and include each hotel’s online reputation scores as a part of the staff ’s remuneration. n The third challenge - strategic - involves recognising how each insight brings value to a specific domain of value creation (for instance, identifying whether an insight is particularly useful for the branding strategy or the development of a new product or a staff recruitment policy). Decision-makers in the C-suite must pay particular attention to how they integrate these insights into their decision-making process. A good example of this is L’Oréal Paris which, having

discovered momentum on the web indicating increasing interest for a particular hairstyle in 2011, decided to closely monitor the development of consumers’ interest for this hairstyle. This led to the development of a new hair dye solution targeting this need as well as the integration of their new insights at different points on their value chain, from branding to positioning and to product development. As one example of a more thorough process of bottom-up digital brand building, L’Oréal Paris decided to choose as the brand name for their new product the very term consumers used in their organic searches for the hairstyle (i.e., “ombre”). Leveraging digital data to create agile companies In a world where the digita l revolution transforms markets and rapidly changes the competitive landscape, the ability to integrate digital intelligence gives companies a significant edge in understanding and anticipating market movements. As the cyber world becomes ever more inundated with information, it is time for brands to integrate digital intelligence into their operational, organisational and strategic decisions, to foster the degree of agility that will give them a sustainable competitive advantage in the decades ahead.

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MBAs

THE CYBER SECURITY MBA - BRINGING NEW TOOLS TO THE BOARDROOM Craig Seal and Tony Coulson

ceo-mag.com / Spring 2016

Introduction and Overview ur MBA program at California State University, San Bernardino (CSUSB), fo c u s e s on t r a n s for m i n g to d ay ’s business talents into tomorrow’s leaders, through our world-class faculty and staff, global accreditation and recognition, student support services and high impact practices, and our cost and convenience. If you compare MBA offerings, there is no better value AACSB (The Association to Advance Collegiate Schools of Business) accredited program out there - particularly given our global recognition, convenient course offerings and affordable cost structure. Our classes strive to integrate theoretical expertise with real-world experience and practice. Our program culminates in a fi nal project, where teams of students work collaboratively on a real organizational issue. We also offer internship opportunities, study abroad experiences, and collaborative research with faculty. Preparing Students for Life After Graduation Businesses today are looking for exceptional com mu n ication , problem-solv i ng, a nd collaborative skills. To this end, our courses focus on oral and written communication, indepth problem-solving, and teamwork to develop student competencies. All of this is underpinned by exceptional faculty, the majority of which have terminal degrees (such as a PhD), are research active, and have extensive real-world professional experience. Our college also features a Business Alliance Board that provides input and connection to the business community. Technology and Innovation One of the learning goals of our program is information technology - specifically that “each student can use information technology to support the structure and processes of the organization, and use information technology in decisionmaking”. One of ou r essent ia l cou rses i s ca l led I n f o r m a t i o n S y s t e m s a n d Te c h n o l o g y Management, and we have three focus areas that deal with technology and innovation: n Business Intelligence and Information Technology n Cyber Security n Entrepreneurship For our students, the focus is less on the specific technology, and more on the underlying concepts of continuous improvement and innovation. It is imperative for today’s emerging leaders to not only be comfortable with change, but to know how to drive change in organizations. The CSUSB MBA Cyber Security Specialization The Cyber Security specialization has been ceo-mag.com / Spring 2016

extremely popular with both students and employers. It gives a perspective of risk and project management that most cyber programs don’t include. Combined with elements of law, fi nance, and management, the technology aspects offer the perfect package for the modern work environment. Although the offering is directed at managers, i.e. those who want to plan and implement the information strategy for an organization, it can also help programmers understand the business side, and administrators the technology side. Our philosophy is “where there is interest, there is learning”. We want students to do a lot of work outside of class, maybe 50 per cent, to get a real hands-on feel for the subject. As a professor, I don’t want to talk at my students, I want them to love the subject matter and be the best at it. One-Day Seminars Cyber Security, once the domain of scientists, is now a very broad field. Many people are scrambling to get an understanding, including the thousands of general information systems professionals out there. Our plan is to build a series of topic specific seminars for those who are time-poor. One area we’ve seen a lot of interest in is intelligence. Many organizations are looking at getting into the business of predicting cyber incidents rather than just reacting. Cyber Security Careers We have a lot of students getting picked up by government and private organizations, sometimes in a bidding war. Most of our students, once graduated, are the project managers, CIOs or senior managers within their company. I recently got a call from someone who had hired three of our students wanting to know our ‘secret’ to building a well-balanced workforce. Leaders who are seeking a career in Cyber risk and Cyber Security require a unique decisionmaking skill-set. They must be able to understand the highly technical connectedness of systems and the potential for snowball effects. On top of that, they must also be able to manage the balance of people, processes and technology to avoid being an impediment to the business. To be a great leader in this field requires the ability to balance the risks without being too lax or draconian. Program Recognition Our Cyber Security offering continues to receive international recognition. In 2009, the National Science Foundation (NSF) awarded CSUSB a four-year grant entitled Scholarship for Service: CyberCorps. As one of approximately 30 schools nationwide, the program provides ‘full-ride’ scholarships for CSUSB Cyber Security students. The grant was recently renewed through to 2017. In 2011, CSUSB became a founding member of Cyberwatch West, an NSF funded Advanced Technological Education center.

“As a professor, I don’t want to talk at my students, I want them to love the subject matter and be the best at it.” “We have a lot of students getting picked up by government and private organizations, sometimes in a bidding war.”

BIOGRAPHIES Craig R. Seal is Associate Professor for the Department of Management and Assistant Dean for the College of Business and Public Administration at California State University, San Bernardino. Tony Coulson is the Director of the Cyber Security Center at California State University, San Bernardino. 21

Cyber Security

‘TEN COMMANDMENTS’

OF CYBER SECURITY CAN ENHANCE SAFETY Hacker attacks such as the one on Hollywood Presbyterian Medical Center show how easily digital platforms can be turned against organizations, but taking 10 steps can augment security, write RANE founder David Lawrence and his co-authors in this opinion piece.

magine you are admitted to a hospital for treatment of a serious but treatable illness, and then your records are stolen. The medical staff is now at a complete loss about your care. While the doctors are scrambling to figure out what to do, they soon realize that all the hospital’s records are missing and that someone is demanding that the hospital pay a ransom in exchange for their release. Now imagine further that the hospital has no alternative but to pay the demand (in Bitcoins) in order to ensure the safety of its patients. One has to look no further than the recent attack on Hollywood Presbyterian Medical Center and other headlines to realize how quickly and easily our digital platforms can be used against us. While the Internet has delivered on its promise of global access and efficiency, it also accelerates and scales the darker forms of human activity — theft, fraud, extortion, blackmail, espionage

(state and corporate), terrorism, insider trading, property destruction and criminal mischief. Soon, the Internet of Things (IoT) will even more seamlessly connect our devices to everything we need — as well as everything we need to fear. As we continue to learn, the Internet was built for connectivity and speed — not security and protection. For criminals, rogue states and mischievous actors, the digital world has become the “promised land” — low risk and high reward — offering a borderless reach, assured anonymity and defenseless victims who are not allowed to fight back. Foreig n gover n ments , state -spon sored actors, criminals, terrorists and lone actors are increasingly targeting our data systems and information networks. The fi nances, trade secrets and operations of our enterprises, as well as the identities and privacy of our citizens, are ceo-mag.com / Spring 2016

at constant risk. President Obama addressed the urgency and ubiquity of this security crisis in his recent Wall Street Journal op-ed. Networks that control critical corporate and governmental infrastructure (power grids, manufacturing plants, communications, health and transportation systems) are being probed for vulnerabilities with an eye toward future infiltration and disruption. The federal government — as well as our leading military and law enforcement agencies — have been repeatedly targeted by cyber criminals, including the intrusion last year into the Office of Personnel Management when the personal information of millions of current and former federal employees was stolen. Hackers in China and Russia are targeting U.S. defense contractors. North Korea’s alleged cyberattack on Sony Pictures in 2014 destroyed data, disabled thousands of computers and disrupted the executive suite. Distributed denial of service attacks has been launched against governmental agencies, the media, utilities, banks, hospitals and manufacturing firms, just to name a few. ceo-mag.com / Spring 2016

With more than 100 million Americans’ personal data compromised in recent years — including credit-card information and medical records — it is no surprise that nine out of 10 Americans say they feel they have lost control of their personal information. These cyber-threats are among the most urgent risk to America’s economic and national security and the personal safety of its citizens. As America’s cyber adversaries have grown more sophisticated and active — emboldened by their successes and the absence of consequences — the need to be proactive, nimble and resilient has increased. In this environment, it is easy for even the most sophisticated enterprises to feel overwhelmed. The federal government, which is obligated to protect the information provided to it by the American people, has a unique responsibility to lead. The fact is, though, that even the U.S. government does not have in place all the tools it needs, and in many areas it lacks safeguards that many businesses require.

Cyber Security

“For criminals, rogue states and mischievous actors, the digital world has become the ‘promised land.’”

Sharing Knowledge Matters In cyber risk ma nagement, because information systems are, by design, interactive and interconnected, and threats come from a wide variety of sources, knowledge sharing is essential. Lessons can be learned from both our successes and failures, so it is essential to share our hardearned collective wisdom. When it comes to the risks of cyberattacks, we are all in this together. Recognizing the magnitude of shared cyber exposures, President Obama recently announced the formation of a bipartisan Commission on Enhancing National Cybersecurity to focus on long-term solutions. It will be composed of top business, strategic and technology experts from inside and outside the government, and provide specific recommendations for bolstering cybersecurity awareness and protections across the public and private sectors over the next decade. (In June 2015, we shared the idea for the formation of such a commission in Knowledge@Wharton in an opinion piece titled, “We Don’t Need a Crisis to Act Unitedly Against Cyber Threats.”) While this is a significant step towards recognizing and responding to our exposures, the Commission’s fi rst report is not expected until December 2016. Fortunately, in the interim, there are proven and common sense steps that can be taken immediately. These “commandments” are presented below. As a caveat to the ‘Ten Commandments’ of cybersecurity, we remind our readers of the Mel Brooks movie A History of the World, Part I, where Brooks plays Moses. He returns from Mount Sinai with three tablets and announces: “I give you the Fifteen Commandments,” but then accidentally drops and shatters one of the stones. He quickly recovers and re-announces “The Ten Commandments.” Already, we are aware of important and emerging “commandments” that will need to be shared in the future. In this vein — because no single sector, industry, enterprise or individual can have all the answers — we invite your continued thoughts and suggestions about a problem that must be addressed, collectively and collaboratively, before it grows to Biblical proportions.

DEVELOP AND PRACTICE STRONG CYBER HYGIENE

n Conduct full background checks of personnel to mitigate “insider” threats. n Implement robust passwords or other advanced means of multi-factor authentication. n Ensure security of computing and communication devices, especially when traveling abroad. n Train employees on email etiquette and “spearphishing” schemes. n Keep personnel up-to-date as to relevant incidents, causes and consequences. n Increase and demonstrate cybersecurity common sense as part of performance reviews. n Utilize surveillance and malware detection and “detonation” software.

n Assess the security needs for encrypted phones, laptops and smart devices.

KNOW AND SECURE VENDORS’ NETWORKS

n Limit access in accordance to need. n Conduct diligence on the backgrounds of vendors with access. Enterprise security is only as strong as its weakest link. n Review existing contract language. Understand vendors’ cybersecurity protocols. n Contractually bind vendors to security standards and protocols. n Identify, rank, engage and audit third-party vendors in accordance with geography and business importance. Vendors must be willing to partner in maintaining your security. n Require vendors that provide critical data to disclose cyber incidents within 72 hours of occurrence.

IDENTIFY AND PROTECT THE “CROWN JEWELS”

n Identify and separately protect critical data and systems (such as customer data, IP, business strategy, market sensitive information and internal communications). n Verify and update processes with business stakeholders, including the C-suite and board. n Implement and regularly update appropriate controls, systems and processes to protect systems. n Verify, validate and regularly test security systems to ensure the continued protection of critical data in the most effective manner.

PRACTICE YOUR INCIDENT-RESPONSE PLAN

n Engage the board of directors, as well as business, legal, marketing, insurance, human resources and technology departments to develop a crossfunctional incident response plan and team. n Retain outside technical, legal and public relations experts to be “on call” for the inevitable cyber incident. n Identify appropriate contacts within law enforcement and applicable regulators before a cyberattack. n Focus on range, motivations and objectives of potential attacks (i.e., theft, denial of service, ransom and publication). n Comply with privacy laws, and work with counsel to protect the confidentiality of the work.

ceo-mag.com / Spring 2016

ABOUT THE AUTHORS David N. Lawrence, founder of Risk Assistance Network and Exchange (RANE), is a former managing director at Goldman Sachs and has held various senior positions with the U.S. Attorney’s Office in New York. Daniel Garrie is the editor-in-chief of the Journal of Law and Cyber Warfare, and the managing partner of Law & Forensics. Jay Clayton is comanaging partner of Sullivan & Cromwell’s General Practice Group. He is also an adjunct professor at the University of Pennsylvania Law School. Frances Townsend is executive vice president of MacAndrews & Forbes and was Homeland Security advisor to President George W. Bush. Tim Murphy is the former deputy director of the FBI, and is the president of Thomson Reuters Special Services. John Squires is a senior partner at the law firm of Perkins Coie, specializing in intellectual property and technology law. Matthew Lawrence is a legal and IP researcher at Perkins Coie, and attends Fordham University Law School. Note: The views expressed by the authors are entirely personal and may not reflect the opinions of their current or former organizations. ceo-mag.com / Spring 2016

Cyber Security

“One has to look no further than the recent attack on Hollywood Presbyterian Medical Center and other headlines to realize how quickly and easily our digital platforms can be used against us.”

CREATE AND DEVELOP A GLOBAL COMMUNICATIONS AND MESSAGING FRAMEWORK

n Ensure that any communications plan covers all relevant constituencies — employees, consumers, customers, regulators and investors. n Identify all regulators (federal, state, foreign) that will expect disclosure. n Identify media, social media and source-channels for disseminating company information. n Retain messaging experts to ensure a coordinated response when it is needed.

TEST THE INCIDENT RESPONSE PLAN AND UPDATE REGULARLY

n Utilize a third-party firm to conduct annual penetration tests to identify weaknesses in IT networks, infrastructure and employee practices. n Report the results to the board and C-suite on a regular basis. n Modify the plan to reflect the results of testing.

ACKNOWLEDGEMENT Republished with permission from Knowledge@Wharton (http://knowledge. wharton.upenn. edu), the online research and business analysis journal of the Wharton School of the University of Pennsylvania. 26

DEVELOP A ROBUST CYBERTHREAT MONITORING AND SHARING TEAM

n Monitor cyber-threats both internally and externally, and regularly probe systems for weaknesses. n Monitor the Internet, social media and dark web for stolen data and information on key executives and business operations. n Test employee practices and compliance with security procedures. n Participate in industry cyber-threat sharing platforms, and ensure an organizational ability to act on the intelligence provided.

EVALUATE CYBER-SECURITY INSURANCE

n Assess the full range of risks and costs from disruption of services, data leaks, data ransoms and extortion schemes. n Ensure that coverages map to the cybersecurity controls, process, vendors, and protocols in any incident-response plan. n Stay abreast of the market. Cyber insurance is still in its infancy and continues to evolve; coverage and pricing remain works-in-progress. n Regularly review policies for gaps, newly available coverage and price-competitiveness. n Verify and validate that key partners have coverage: A vendor that is hacked can lead to your organization being compromised.

ENGAGE PRIVACY AND CYBER-SECURITY EXPERTISE FOR ALL PRIORITY JURISDICTIONS

n Maintain industry contacts for information and threat sharing, including best practices and solutions. n Use industry leverage to petition the government for needed information, assistance and liability safe harbors. n Maintain and update this information on a regular basis. n Consult privacy counsel to ensure that cybersecurity solutions do not violate local laws.

MAINTAIN GOVERNMENT RELATIONSHIPS

n Know the key agencies and personnel in the jurisdictions in which you do business: The government can be a critical partner in prevention as well as in response. Their expertise and intelligence can be invaluable. n The time to forge such relationships is before a crisis — not after a cyber-security breach.

ceo-mag.com / Spring 2016

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Digital Strategy

“A few companies are searching for competitive advantage by analysing the huge quantities of data created by people’s online voices and actions.”

BIOGRAPHIES Misiek Piskorski is Professor of Strategy and Innovation at IMD Business School. He is co-Director of IMD’s Leading Digital Business Transformation and teaches in Orchestrating Winning Performance.

WHAT HAVE DIGITAL AND SOCIAL MEDIA DONE TO YOUR STRATEGY?

Get ready for more digital transformation

Carlos Cordon is LEGO Professor of Strategy and Supply Chain Management at IMD. He teaches in IMD’s Leading the Global Supply Chain. ACKNOWLEDGEMENT Courtesy of IMD. 28

ceo-mag.com / Spring 2016

BY IMD PROFESSORS MISIEK PISKORSKI AND CARLOS CORDON

irms today are beginning to understand the importance of social and digital media to their corporate strategies. They have struggled to survive during a period that has greatly threatened their business and marketing models: 3.2 billion people are now online, and they are already spending more time there than watching TV. They are making and watching videos about products they like – and tweeting vigorously about customer service that they do not like. Taken together this means that traditional approaches to marketing are obsolete. Some companies have been at the forefront of developing new strategies as a result of what they have learned, but many have not, and there are a number of issues businesses need to consider before making their next moves. Focus on inﬂuencers Influencers are third parties who can raise awareness – and encourage the purchase – of a company’s products. Firms that place influencers at the heart of their social strategy do so to increase their presence at each stage of the customer journey. Companies are using online inf luencers in two ways. The fi rst is by having other people talk about their brands, for instance by sponsoring vlogs (video blogs) by popular online figures. The second is creating communities using platforms such as Pinterest, Facebook and Twitter; research suggests that a typical Pinterest user is very likely to buy something she has “pinned” (placed on a virtual noticeboard) or seen pinned by others. Such communities need not be consumer-focused: Cisco has made effective use of communities in the B2B space to build leads, collect ideas for product development and increase the barriers to entry for its competitors. Reckitt Benckiser’s Durex condom brand has enjoyed great success in China, usually a difficult market for Western consumer brands, with an allsocial approach that draws heavily on the power of influencers. For instance, it leveraged China’s version of Twitter, Weibo, for cheap advertising and to engage digital opinion leaders. As a result of its strategy, it has become the brand of choice for affluent Chinese consumers. Adding big data to the picture A few companies are searching for competitive advantage by analysing the huge quantities of data created by people’s online voices and actions. GE sees a future in the analysis itself; it recently divested most of its fi nancial services business to invest instead in big data and analytics. BBVA, the Spanish bank, is taking it so seriously that it promoted its head of digital banking to the role of president and chief operating officer, declaring its ambition to “become the best universal bank in the digital age”. ceo-mag.com / Spring 2016

Amazon is exploiting the advantages of big data by developing new services, including “anticipatory shipping”. The online retailer uses all its valuable data about its customers’ preferences and habits to predict what they are likely to buy, and ships those packages to nearby hubs or even trucks, where they wait until the order arrives. Big data is also creating huge opportunities for entrepreneurs who are willing to innovate. Strava, a California-based start-up, is a web and mobile app that allows users to track their athletic activity, such as running and cycling, and share their results and routes with other users. On Strava you can fi nd the best local circuit for your activity, track your run or bike ride, compete with friends and other users across the world, and see what your favourite athletes are doing. The company relies on a wide network of partners, including GPS and software providers, government authorities, local communities of athletes, and suppliers such as bike manufacturers. It has access to tons of big data, including GPS coordinates, users’ personal information (including health-related data), and information on activities such as where a runner made a stop or what drink she had. Having recently secured venture capital funding, it is planning to expand out of the US and develop new solutions for users. Large companies, such as Nike, have taken this same strategy and rolled it out across millions of their customers. Such a strategy allows Nike not only to provide improved customer value, but also to predict when the customer is likely to need a shoe, and what kinds of shoes the customer will like, and use this data to power its R&D efforts which results in more successful product launches.

“The winners will be those companies that can identify the disrupting technologies that matter and develop solutions that deliver value to customers.”

Digital strategies in the future By now many firms have understood the importance of incorporating social and big data strategies into their everyday operations, but we are nowhere close to being done with the digital revolution. Artificial intelligence, such as IBM’s Watson project, and the Internet of Things, whereby sensors connect and embed intelligence in billions of objects and devices all around the world, are going to affect the productivity, health and safety of billions of people. They are also going to result in countless new products and services that will transform the customer experience. The winners will be those companies that can identify the disrupting technologies that matter and develop solutions that deliver value to customers. In many of these cases, having a social strategy – using social platforms to deliver social benefits – will be a key element of securing competitive advantage and a profitable future. Many companies have successfully embarked on this journey. Is your company next? 29

MBAs

“Businesses that are slow to embrace analytics and the opportunities it presents run the risk of never catching up, and losing instead of growing their market share.”

KENT STATE GOES BIG ON BIG DATA

Alexandra Skinner speaks to O. Felix Oﬀodile

hat prompted you to oﬀer the Master of Science in Business Analytics (MSBA)? This grew out of the need and demand from businesses and alumni in the area. However, this is not just a local issue. Several research institutes, including McKinsey, have projected acute shortages, especially in the United States, in people with analytics expertise needed to turn big data into a business’ competitive advantage. The study further predicts that by 2018, the shortage could be as high as 190,000 in the US alone. I should also point out that Kent State will be the only public university in northeast Ohio offering a full master’s programme in analytics. When you consider the size of the local population, the programme really is a ‘must’ for the locale. Your MSBA has been given STEM designation. What does this mean to international students? The big advantage of the STEM designation for international students is that they may qualify for extended Optional Practical Training (OPT) of up to 29 months, compared to 12 months for non-STEM programs, to gain more practical experience in their field of study while in the United States. Although we often talk in terms of the benefits STEM programmes afford international students, these programmes benefit US citizens as well, especially in their potential for job creation and

employment. We know that many IT experts employed today don’t have the skill sets required to handle Big Data, but is this programme designed for them, or those that follow? Actually, the programme is designed for both. On the one hand you have IT professionals working in business today that already have business and leadership experience, but perhaps lack the technical expertise, and on the other, graduates that lack business experience but have the technical aspect of analytics. For the IT professional, the MSBA will equip them with the foundation and knowledge needed to delve into the technical realm, and for the entry-level manager or graduate it will provide an opportunity to work with those that have experience. All in all this makes for a great team dynamic, especially when working on ‘real-life’ industry problems. The Big Data skills shortage is already here, and will only get bigger. What can employers and universities, like Kent State, do to address this? I think it’s about universities providing opportunities for students to go back to school, be it through workshops, seminars or programmes like ours. Working professionals may not necessarily want to take a year or two out to complete a degree, ceo-mag.com / Spring 2016

“Businesses also have a part to play in encouraging employees to take advantage of such opportunities through flexible work schedules and incentives that defray the cost of education.”

but a workshop or seminar can be completed in a day and will allow them to brush up on their knowledge. This is something that we will be offering at Kent State in the near future. Busi nesses a lso h ave a pa r t to play i n encouraging employees to take advantage of such opportunities through flexible work schedules and incentives that defray the cost of education. You’ve touched upon corporate funding. When it comes to analytics, will we see businesses investing in their employees as, perhaps, they did some years ago? It’s possible – we are seeing corporations defraying the cost of education for certain students, but this is really borne out of the need they have in this area. As a University we’re actively looking at ways in which we can help exceptional students when ceo-mag.com / Spring 2016

BIOGRAPHY O. Felix Offodile is a professor of operations management and Chair of the Department of Management & Information Systems at Kent State University. His teaching and research interests are in Operations Management and Cognate Disciplines with a focus in Robotics and Technology Assessment, Cellular Manufacturing, Quality Assurance, Inventory Management and Supply Chain Management. 31

MBAs

it comes to defraying some of the cost attached to the programme. Given the opportunities that await those with Big Data skills, it would not be unrealistic to imagine demand for an MSBA, or equivalent oﬀering, surging over the coming years. With this in mind, what do potential students need, at the undergrad level, to be considered for such a programme? Our preference would be that students applying to the programme have a baccalaureate degree in the sciences, business, or engineering. This gives them the background knowledge they need in math, statistics and, to some extent, technology. That being said, these things can be easily taught, i.e. someone who doesn’t have this background can take prerequisite courses over a semester or two to gain this knowledge. This, however, is the easier of our two requirements. The other requirement is that applicants be curious, interested in problem solving, able to communicate, lead, manage projects, and more. T h i s i s re a l ly wh at d i st i ng u i shes ou r programme from a typical master of science in analytics. A Master of Science in Analytics (MSA) usually stresses the technical aspects: math, statistics and, to a degree, technology. Whilst we recognise that these skills are incredibly valuable, we try to consider what the student can do for a business once they have them. Can they speak the language of business?

“As a University we’re actively looking at ways in which we can help exceptional students when it comes to defraying some of the cost attached to the programme.”

Upon completion of the Kent State’s MSBA, where do you see your graduates slotting in, i.e., as analytics managers or project managers that are part of a company’s data science team? It really depends on where the student was prior to entering the programme. We expect those that already have business experience to be managers and team leaders. Although undergrads that enter the programme directly will not have business experience upon graduation, we expect them to be able to lead analytics teams - as well as management teams in analysing business analyticsand business problems, and communicate theresults to upper management. In addition to the quantitative skills students will derive from the MSBA, how much focus will be given to understanding the business value of analytics and where it ﬁts in the cycle of data through an organisation? This is really the crux of the programme. Again, I would point to the difference between the MSA and the MSBA. Our programme has a three-pronged focus in that we stress analytics, technical tools like math and statistics, and the business element that stresses leadership, communication, critical thinking, and decision making. We expect our graduates to speak to all components of analytics, not just the technical aspects.

When it comes to identifying analytical skills, those which top the bill tend to revolve around making decisions as opposed to making spreadsheets. With this in mind, how much emphasis do you place upon skills like critical thinking, communicating and presenting ﬁndings, problem solving, data analysis (drawing conclusions), and decision making? Our programme tends to look at analytics holistically by integrating decision-making, critical thinking, leadership, communication, problem-solving, data visualisation and analytical skills into the programme. This approach helps to take analytics out of the technical realm and into the boardroom and business management strategic discourse. Todays’ thinking suggests that companies are better positioned for overall market success when they use data, analytics, statistics, and probability to define and solve problems. Consequently, strong analytical acumen and the support for such endeavour needs to come from the top. For business leaders and executive teams playing catch-up, how do they bridge the gap? Let me borrow from Nike, I think the maxim is ‘Just Do It’ if memory serves. You have to start, because playing catch-up somewhere down the line is just not going to cut it. Yes, they may not have the resources and time to be able to send their employees to four-year institutions to get a degree, but I think as a minimum, conferences and seminars, as I mentioned earlier, are a good start. Some of the knowledge required is really gained through exposure. Once you get their feet wet and they begin to speak the language, their interest will grow. This in turn may allow the employer to see the advantage of the one-day seminar or workshop, which may then lead to them suggesting their employees escalate their knowledge by attending programmes such as Kent Sate’s, which takes just 12 months to complete. Returning employees can then help to train their peers. Alternatively, if greater flexibility is required, employees can attend parttime, taking one or two courses per semester. It is well known in the industry that some businesses, for reasons best known to them, tend to embrace ideas very late in the process. Businesses that are slow to embrace analytics and the opportunities it presents run the risk of never catching up, and losing instead of growing their market share. What does the future hold for the MSBA? If you look at the statistics across the globe, not just in the US, enrolment in traditional MBA programmes has been going down, whereas enrolment in specialty business MS programmes has been going up. In the past five years, analytics enrolment has skyrocketed. Consequently, I see this programme growing exponentially. We have yet to market the MSBA and have already received enquiries, which is obviously a very positive start. ceo-mag.com / Spring 2016

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MBAs

THE ROAD TO THE EMBA

SO, YOU’RE THINKING OF ENROLLING IN AN EXECUTIVE MBA PROGRAM... F R A N C I S P E T I T, E D . D .

Y “Prospective students, as the trends indicate, are now willing to pay more out of pocket for their EMBA programs.”

ou are a middle manager who realizes that you cannot transcend to that next level unless you have a graduate business credential in hand. Alternatively you are thinking about a career change and want to utilize the Executive MBA (EMBA) to catapult your professional life in a new direction. Either way you are excited about the opportunity as you witnessed how EMBA programs have positively impacted your colleagues and friends. You then attend a few information sessions at some local EMBA programs. One program, in particular, catches your attention. You like everything about it from the curriculum to the format to the culture even to the price. You are now very excited about the opportunity and want to move forward. You then approach your line manager who seems open to the idea but not overly enthusiastic. He or she then recommends, as a next step, that you speak to human resources to fi nd out the official corporate policy regarding EMBA programs. You then approach human resources only to

fi nd out that your organization either does not fi nancially reimburse tuition for EMBA programs or has a long arduous process to obtain fi nancial sponsorship. You are now frustrated, deflated and angry. For the past number of years you have poured your heart and soul into your work only to fi nd out that your organization may not want to invest in you. So, what do you do? Well, you are certainly not alone. Full corporate fi nancial sponsorship for EMBA programs has been steadily declining over time, yet the demand from prospective students to pursue the EMBA has remained strong. Prospective students, as the trends indicate, are now willing to pay more out of pocket for their EMBA programs even when their organizations are only sponsoring them with ‘time away from the office’. With this as a background, below please fi nd some advice for all prospective EMBA students who are exploring the options.

ceo-mag.com / Spring 2016

Step #1 - Searching For Programs It is important to explore all potential EMBA options that make logistical sense. While it may be difficult, please keep the tuition price out of the equation while initially searching for programs. The goal, in this step, is to fi nd two potential programs that are the right fit for you regardless of price. It is also very important to fully research programs. Be in constant communication with the program director. Request to sit in on a class to sample the product. Speak with current students and alumni. Become fully immersed in the product and its experience. Then and only then will you know which program is the right fit for you. Step # 2 - Financing Options Don’t let your organization’s limited fi nancial sponsorship stop you. Find out your organization’s exact corporate fi nancial policy for EMBA programs. Once you are familiar with this policy then you can go to your line manager to see if he or she is willing to go above and beyond the policy with additional financial sponsorship. If so, human resources will usually sign the sponsorship off , and now you know your total corporate support and the subsequent balance that will be incurred. There are options to fi nance the remaining balance. EMBA students can enroll, over the course of the program, in official payment plans within the university. There are also increased ceo-mag.com / Spring 2016

scholarship opportunities within business schools to assist students. In addition, there are federal and private loans that can assist students. Furthermore, a student should speak with their accountant to creatively (and legally) get some of the tuition money back through tax refunds. Lastly, speak with your financial planner to discover other creative ways of fi nancing the EMBA. To support you in fi nancing your studies, your business school can be proactive in providing customized documentation for you and your organization in order to be reimbursed. You can request your business school to specifically tailor letters that can hopefully assist with your reimbursement within your company. On the whole, organizations tend to be cautious and short-sighted when it comes to investing in their workforce. Don’t let this stop you in pursuing your scholastic goals. You can make it happen. Step #3 - Selecting a Program Once you thoroughly research programs that are the best fit for you and all the options for fi nancing, then and only then can you make an educated decision as a consumer. Please also get buy-in from your loved ones. You want their full support in your decision in order for you to be able to dive right in and get the most out of your EMBA EXPERIENCE. Lastly, please make sure your line manager is on-board. It is always better to work through your line manager (as opposed to HR) regarding EMBA matters.

CLOSING THOUGHTS

An Executive MBA program can be a transformative and life-changing experience. Regardless of the obstacles that may exist in achieving this goal, you can still make it happen - through research, strategic decision-making and persistence. You can do it!!!

BIOGRAPHY Francis Petit, Ed.D. is the Associate Dean for Global Initiatives and Partnerships within Fordham’s Gabelli School of Business. 35

MBAs

THE COLLABORATIVE WAY TO MASTER YOUR MBA “Tell me and I forget, teach me and I may remember, involve me and I learn.” – Benjamin Franklin

“Collaborative learning in companies is also becoming the way of the future, as the team – not the individual contributor – is seen as the secret for business success.”

f you’re thinking about undertaking a rigorous programme such as an MBA, completing the journey with a partner can not only make the experience more enjoyable, but improve your chances of success. Collaborative learning can actually improve your chances of out-performing your classmates, as not only do you have a partner to bounce ideas off of, but you’ll gain personal support and motivation from this learning method as well. Several experimental studies have shown that groups out-perform individuals on learning tasks, and that individuals who study in groups do better on later individual assessments (such as exams) (DarlingHammond et al. 2008). These results are almost unsurprising when you consider that some of the world’s largest and most successful companies - including Microsoft, Apple, eBay and Twitter - were founded by duos working together, many of them long-term friends, classmates, or relatives. Collaborative learning in companies is also becoming the way of the future, as the team – not

the individual contributor – is seen as the secret for business success. Studies reveal benefits of collaborative learning include a 20 per cent reduction in the time it takes to bring an idea to market; 15 per cent increased productivity; 50 per cent improved communication; and 35 per cent greater innovation and creativity (ThomasAguilar 2015). Studying with a partner also provides several benefits including the option to combine your experience and skills to quickly cover more ground, as well as the ability to test each other’s knowledge by quizzing your partner, checking their assignments, and asking them study questions that you might not have felt comfortable posing to a larger study group. Collaborative learning is also much more fun than tackling the work alone and at the end of your study journey, you’ll graduate alongside someone who shared the journey with you, just as many of the students and graduates at the Australian Institute of Business (AIB) have done. Read on to hear their stories and tips for success in studying with a partner. ceo-mag.com / Spring 2016

TOP 10 TIPS FOR STUDYING THE AIB 12 MONTH MBA IN A PAIR:* 1.Play oﬀ each other’s strengths and abilities: If you’re a planner who hates to leave assignments to the last minute, help your partner to get organised by drawing up a study schedule and setting aside blocks of time to study. 2. Remember there’s no one ‘right’ answer: At AIB, assignments and exams are work-applied, meaning that each answer will be as unique as your experience allows. 3. Build oﬀ each other’s experiences: Share how the theory applies to your work experiences, which will not only make the topic more meaningful to you both, but also help you to recall the information in the exam. 4. Keep up the friendly competition: See who can get the best grades, get their exams fi nished faster, the least spelling mistakes, or the highest GPA throughout their studies. 5. Focus on your goals: Motivate each other to stay committed to your timeframes and goals. If you need further motivation, try to keep your end goal in sight – remember, AIB’s MBA is just 12 subjects delivered over 12 months of study. ceo-mag.com / Spring 2016

6. Don’t neglect other members of your household: Remember your other family members and friends who are supporting you and want your attention as well. 7. Take advantage of student support: AIB offers student and academic support at every step of the way. 8. Hold each other accountable: Agree to the number of hours you’ll commit to your studies each week and set times aside to study together. 9. Remember your relationship: Honour your relationship and just enjoy being friends, or partners, outside of the time you’re spending studying. 10. Celebrate your success together: The success of your studies is founded on your relationship, so now is the time to celebrate together – before graduating together on stage.

*When preparing assessments for AIB, always be aware of the Academic Integrity policy – speak to an AIB Academic if you need any clarification. 37

MBAs

STUDENT STORY:

Mother and daughter make study a family aﬀair

S AUSTRALIAN INSTITUTE OF BUSINESS is a 30 year old business school based in Australia, offering degrees, undertaking research, and providing consultancy services globally. AIB was the first, and remains the only, private institution in Australia to be government approved to confer the full suite of business degrees, including the prestigious PhD. 38

hauna Paine and her daughter Briony were both at a crossroads in their careers when they decided to complete an MBA. While Briony had recently left work in the government sector as a result of extensive job cuts, her mother, Shauna, wanted to move out of the government system and start her own private business. It was Shauna who suggested, after extensive research, that the pair study their MBAs together, expecting that they would support each other to complete the degree together. “At fi rst, Briony wasn’t convinced that she could undertake a Master’s degree while working full-time, but AIB’s accelerated, ‘one subject a month for 12 months’ format made the choice easier for her to take the study on,” Shauna said. “Having my daughter living, working and studying in the same household could be quite testing at times, but it was brilliant how we supported each other, and kept each other accountable,” she said. “When things went wrong, like at 11pm when I had an assignment due at midnight and my computer has just crashed, Briony said, ‘Right, you’ve had your meltdown. It’s done. It’s not going to serve you well. Get on with it,’ so

that constant support from my daughter was amazing.” Unfortunately the journey wasn’t all smooth sailing, and there was a time when Briony became seriously ill mid-way through her MBA. Her mother, Shauna, called AIB for support, as she was concerned about an upcoming assignment deadline. “The response from AIB was, ‘You don’t need to worry – right now, her health is more important than the assignment.’ As a mum, it was like a weight was lifted off my shoulders because I could tell my daughter not to worry about her assignment – all AIB cared about was her getting well,” Shauna said. Now near the end of their MBA journeys, Shauna has completed her dream of setting up her own consultancy business and is fast gaining traction in the market, while her daughter Briony has taken up a new role in marketing and event management, and is following her passion for social business and social entrepreneurship. “As I reflect back on our journey, I’m so proud that we studied our MBAs together, as it’s shown me that education enables not just yourself, but everyone you interact with as well,” Shauna said. ceo-mag.com / Spring 2016

STUDENT STORY:

Husband and wife duo take on MBA career leap

aving both come from the education industry, Ann and Tom considered an MBA a way to gain career options beyond their formal experience and background. Ann, who had recently resigned from the Victorian Department of Education to take up her passion of starting up a consultancy, felt the lessons learnt in the MBA would give her the grounding to build her business. Her husband Tom, a former school principal, was looking to broaden his knowledge base and career options. “We had both been talking about doing an MBA for a while, and we decided to do it together so we could support each other with exam preparation and proof-reading,” Tom said. The pair were attracted to the 12 Month MBA with the Australian Institute of Business as it would allow them to study an accelerated degree that wouldn’t take three or four years or more of part-time study. “It’s certainly a practical degree,” Ann said. “Even though our background in education is quite removed as an industry from business, it was easy for us to use education-type examples in our assignments and exams.” ceo-mag.com / Spring 2016

Throughout the experience, the pair found the support they granted each other vital to their success. “I would’ve quit if it wasn’t for Tom – I found the first few subjects more difficult than I had at first expected, but Tom kept me going, saying it was just one more subject, and then suddenly there was only one more to go,” Ann said. “The advantage of us both doing it at the same time was that we had the same deadlines, the same amounts of pressure, and we kept one another on track,” Tom said. “It was good to have someone else in the household who needed to get assignments ready and study for exams, so we understood each other’s needs and supported each other along the way.” The result was a great success in that the pair successfully completed the programme and enjoyed the experience of graduating together, in front of their friends and family. “We have grown-up children, and the concept of continual lifelong learning is a great model to provide them, so we were both extremely pleased to be able to graduate together, in front of our children, in what is essentially middle-age.” 39

Digital Strategy

DIGITAL HAS KILLED THE STRATEGIC PLAN Four crucial steps to creating a business strategy fit for the digital age.

CHRIS OUTRAM, FOUNDER, O C & C S T R AT E G Y C O N S U LTA N T S

oday’s newspaper industry reflects the way online and digital strategies are undermining traditional business models. Many newspapers are now being undercut by entirely disintermediated online news channels ensuring world news is now readily available through any number of portals, including those created by traditional newspaper companies. The Daily Mail Online, for instance, is one of the biggest news websites in the world and read globally. Its newsgathering process is 24/7, undertaken in centres around the world. Its journalists appear never to sleep and its readers are constantly up to date. Mike Darcy, the CEO of The Times of London, characterised the Mail Online as an entirely new product. “The Daily Mail is a U.K. print product, while the Mail Online is a global celebrity news service targeted at a different audience” he notes in my latest book, Digital Stractics: How Strategy Met Tactics and Killed the Strategic Plan. The Daily Mail is a hybrid, a traditional company which increasingly operates in the digital space. As a digital player, it is influenced by its pure digital counterparts or “pure plays”, which are changing the game by shortening or throwing out their strategic plans and aiming for growth and market share at the expense of short-term profit. Think rapid Decisions have to be made faster, because strategy and tactics have increasingly become intertwined. This rapidity was recognised by

ceo-mag.com / Spring 2016

Sidar Sahin of Turkey’s Peak Games who said, “to succeed you have got to read the customer feedback in real time – looking at it monthly is far too slow – that is why small agile teams win.” Having said that, some traditional aspects of business strategy are as important now as they have ever been:

must continue – how have things worked out? What has not worked? How should the company’s strategy change to reflect the things we’ve learnt? And how will this affect our financial performance a nd f ina ncia l needs? T hese questions a re imperative in effectively planning the future with greater insight and understanding.

n Being bold and visionary n Focussing on customer differentiation and competitive advantage n Striving for high relative market shares n Translating this into profit to be invested back into the business In the light of these points, there are four factors that are crucial in creating a business strategy fit for the digital age for both hybrids and pure plays.

4: Install new measures of success The data rich nature of digital business has created myriad ways to measure and monitor success. For example, the “customer journey”, monitored correctly, gives businesses unique insight about customer behaviour. This, in turn, presents opportunities to redesign and optimise the customer experience based on its findings… and to measure it accordingly through services like on-time deliveries. I n add it ion , t he se met r ic s ne ed to be s oph i s t ic ate d enou g h to re co g n i s e t h at experimentation is pa r t a nd pa rcel of the digital world, and a degree of failure of such experiments is also a way of life. Only by trying different approaches, evaluating them rapidly and regrouping around the experiments which appear to be working and abandoning those which are not, can you refine and develop strategy in the New World. Business leaders, no matter the size of their organisation, need to worry about growth and market share rather than short term profitability a nd cash generation. T he investor ma rket understands the importance of being a market leader and that leadership positions give more opportunities for monetisation. CEOs and business leaders therefore need to focus on measures that allow them to understand whether their companies are outgrowing the market and taking share from competitors in both the online and offline spaces. If you are a fast-moving, fastgrowing, online-only business and your more conventional off line competitor is at a loss to understand what is happening, then you are in a winner-takes-all situation.

1: Start with a vision, and a bold one at that Having an ambitious vision around which the organisation can galvanise is vital in a rapidly, and unpredictably, evolving world. This vision should be a statement of intent that will inspire people and get them excited about being part of the journey. A ma zon a nd Google have bold visions. A ma zon’s “ea r t h’s most customer-centric business” and Google’s “organise the world’s information” achieve the delicate balance of being ambitious, motivational and uplifting while also communicating durability and attainability. Remember: If you’re changing your vision regularly, it is probably not a good vision or indeed a vision at all. 2: Establish 90-day strategic goals Define 90-day priorities for everyone in your organisation. Everything now moves so fast that 90 days is probably the right point at which to assess whether the strategic objectives and goals are appropriate and achievable. In setting these 90-day objectives, companies need to make sure that they are consistent and all functions in the business are aligned. This is best done by getting all the right people in a room and debating these objectives and whether they need to be adjusted to reflect organisational stress. Operating in a digital world requires a far greater degree of cross-functional working than in a traditional enterprise: all teams need to be pulling in the same direction. 3: Refresh and recalibrate your financial plans annually All digital businesses need a three-year financial plan to reassure banks and investors that there is a profitable future, and that their money is being put to good use. However, three year plans in the fast-paced digital business landscape are at best only a broad indication of what might be financially possible – and companies have to be brutally honest about what they plan to deliver together with the financial and operational consequences. After the first year, this honesty ceo-mag.com / Spring 2016

Strategy for the digital age Strategy in the digital age has become an increasingly interactive process. The fluidity of digital business models impacts upon the rapidity in which decisions are made and processed. If you have an offline business and are very quick to adopt and roll out the appropriate digital models to complement, protect and grow this business, then you are probably in the best of all worlds. Move slowly and you will probably lose out to more nimble digital competitors. In the longer term, the offline and online will converge in many businesses and “digital” as a word will cease to be a useful way of describing the old or the new world. Winning companies will be those able to integrate old and new world thinking to create sustainable competitive advantage and the value that goes with it.

“Winning companies will be those able to integrate old and new world thinking to create sustainable competitive advantage and the value that goes with it.”

“The fluidity of digital business models impacts upon the rapidity in which decisions are made and processed”

BIOGRAPHY Chris Outram is a founder of OC&C Strategy Consultants. He has an MBA with Distinction from INSEAD (’77) and is the author of Making Your Strategy Work: How to Go From Paper to People and Digital Stractics: How Strategy Met Tactics and Killed the Strategic Plan. ACKNOWLEDGEMENT Courtesy of INSEAD Knowledge 41

MBAs

“The company visits enabled us to feel ﬁrsthand the spirit of Silicon Valley and the diversity of activities over and above technology.”

SILICON VALLEY’S CALLING

he final stage of the ISEG MBA is reserved for what is known as the ‘cherry on top of the cake’ - up-close and personal contact with the unique ecosystem of Silicon Valley, home to the most active ‘cluster’ of companies in the world. João Pedro Vaqueiro, a student of the 29th Edition of the ISEG MBA, travelled to Silicon Valley to be amongst venture capitalists, business angels, entrepreneurs and start-ups. He also had the opportunity to meet some of the local academic community, to get to know different business approaches, and was even introduced to the founders of companies such as NorthFace. Discussing meeting these thought-leaders, João says, “They transmitted their innovative vision and I would especially like to highlight the visits to

companies such as IDEO, where I received training in design thinking - an innovative methodology for project development projects.” “This visit enabled me to realise very clearly that we can be much more entrepreneurial, not only by founding new companies, but also by innovating within the companies where we work”, he goes on to say. For João, the opportunity to travel to Silicon Valley played a large part in his decision to study at ISEG. “The main reasons I opted for the ISEG MBA were the fact that ISEG is renowned for its academic excellence and also the possibly to interact with the internationally-recognised and differentiated business ecosystem of Silicon Valley,” he explains. With a background in Marketing Management, ceo-mag.com / Spring 2016

João Pedro Vaqueiro João decided to reinforce his technical skills as a manager, however the ISEG MBA also constantly demonstrated a concern in “making me grow as a leader, by developing my leadership skills through well-structured programmes”, an example being the Leadership Programme at the Air Force Academy. For João Pedro Vaqueiro, the MBA strengthened his technical expertise, improved his ability to question himself, and resulted in him being more demanding, giving him the capacity to take a 360º view of companies – a skill which is so important for a modern-day manager. For Hugo Ribeiro, a project manager and graduate in electrical engineering, the Silicon Valley visit represented a constant challenge, where each participant aims to gain the maximum experience from the lessons learned, not only for their career, but also for their personal life. “The company visits enabled us to feel firsthand the spirit of Silicon Valley and the diversity of activities over and above technology. Based on the culture of Silicon Valley, this immersion gives us a new vision of success”, affirmed Hugo, a student of the 30th Edition of the ISEG MBA. Visits to companies allow students to get to know different examples of the business world,

Hugo Ribeiro ranging from venture capital to 100 per cent creative companies, and even investments in social entrepreneurship, all of which explain the true spirit of the ‘American Dream’, enabling each person to understand the potential for a company to be profitable, based on a social activity. “We had the opportunity to see the structure of a business operation focussed on social ‘welfare’ with great success”, explained Hugo. A further week’s training at the University of San Francisco allows participants to have contact with a teaching style that is entirely different. “Students finish this programme having gained a different view of the business world and they more confident having developed a know-how which was until this point undiscovered”, says Hugo. The Silicon Valley experience translates into an immersion in an unrivalled culture - from preparing for a real-life ‘elevator pitch’, where students are tested on their ability to put their business ideas to real investors, through to a lively workshop on the training and management of teams, as well as the development of innovative processes, which involves contact with the winning formula of some of the most successful companies in the world, such as IDEO and Keiretsu Capital (an affiliate of the World’s Leading Angel Network). https://pt.linkedin.com/in/hugobribeiro

BIOGRAPHY Based in Lisbon, the ISEG MBA is an AMBA accredited programme designed to empower students to not only develop leadership and analytical skills, but also a strong entrepreneurial spirit and the confidence to make ideas come to life. ceo-mag.com / Spring 2016

Entrepreneurs

“Many mistakenly believe that small businesses are the engines of economic growth—and they write policies that may not actually further economic growth.”

MANY ENTREPRENEURS DON’T NEED SUBSIDIES

ceomag.co.uk / Spring 2016

WHAT DRIVES ENTREPRENEURSHIP?

BY ALINA DIZIK

ong before Apple was a corporate behemoth, it was a small venture that had been started in a garage in Los Altos, California. The US government would like to see lots more similar success stories. It offers a variety of incentives to encourage small companies to launch, innovate, and grow. But research suggests that some of these incentives may be based on a misperception of what small-business owners value and want. Independent businesses with fewer than 500 employees are a huge part of the US economy. They create almost half of US private-sector jobs, and 64 percent of net new jobs. According to census data, the United States has 6.2 million small businesses with a single physical location, compared with 1.2 million companies with at least 500 employees. Some industries are run almost entirely by small-business owners—including florists, dentists, and plumbers. The US offers all sorts of incentives for these business owners. The 2010 Affordable Care Act, for example, exempts businesses with fewer than 50 employees from having to provide mandatory health insurance. But Chicago Booth’s Erik Hurst and Benjamin W. Pugsley at the Federal Reserve Bank of New York point out that, according to their past research, fi nancial success is only part of what motivates small-business owners, who generally earn less than they could in corporate jobs. As the researchers documented in 2011, almost 50 percent of business owners at the start were influenced by factors other than money, such as wanting to keep flexible hours, be one’s own boss, and pursue a passion. Moreover, many small businesses remained small, despite incentives that encouraged them to ramp up. “When asked about their ideal fi rm size, the median response of new business owners is that they desire their business to only have at most a few employees,” the researchers write. To assess the impact of these nonmonetary benefits, Hurst and Pugsley created a new model of the small-business sector, looking for what causes people to launch companies. Their model predicts that people who value nonmonetary benefits will concentrate in industries where companies don’t naturally scale up, and where being small could even be a competitive advantage. The model also predicts a correlation between small-business ownership and wealth, suggesting that “owning a business is a relative luxury good,” according to the researchers. Perhaps most controversially, the researchers fi nd that small-business subsidies are regressive. More small-business owners are wealthy than they are poor, they say, so “the subsidy on smallbusiness ownership just transfers resources to the wealthy from the poor.” Hurst and Pugsley also don’t agree with the widespread notion that small businesses would all ceomag.co.uk / Spring 2016

Small-business owners are motivated to start their businesses largely for nonﬁnancial reasons.

19.5% WANTED TO GENERATE INCOME

2.2% LACKED JOB OPTIONS

32.2%

10.8%

HAD A GOOD BUSINESS IDEA

OTHER

35.3% NONFINANCIAL and the top nonfinancial reasons are...

Enjoy the work; have passion for it

Be own boss

Have job security

Stay tome with children; work from home

generally grow faster if they weren’t cash strapped and burdened by government regulations. “This is likely true for some small businesses,” they write, but not for those whose owners are motivated by nonmonetary factors. Policy makers need to understand better what small-business owners value, the researchers conclude. Many mistakenly believe that small businesses are the engines of economic growth— and they write policies that may not actually further economic growth. Hurst and Pugsley suggest that subsidies may be less distortionary, and more effective, “if they were targeted at growth and innovation as opposed to being mostly linked to fi rm size.” The researchers say they don’t know of any empirical research that weighs the costs and benefits of small-business subsidies and concludes there’s a net benefit. “Addressing this question seems like a very important area for future research,” they suggest.

Set own hours

ACKNOWLEDGEMENT Republished courtesy of The University of Chicago, Booth School of Business. Article first appeared in Capital Ideas. Erik Hurst and Benjamin W. Pugsley, “Wealth, Tastes, and Entrepreneurial Choice,” Working paper, October 2015. ———, “What Do Small Businesses Do?” Brookings Papers on Economic Activity, August 2011. 45

Leadership

EVOLVING LEADERSHIP IN THE DIGITAL AGE Manfred Kets de Vries, INSEAD Distinguished Clinical Professor of Leadership Development & Organisational Change

“The enhanced capabilities and affordability of technology caused by digital innovation has led to fundamental changes in how business is conducted, organisations are managed, and consumers behave.”

o have executives change character will always be an uphill struggle but they can learn to improve their behavioural reactions to diff icult situations and develop greater emotional intelligence that will turn them into more effective leaders. Studies show that organisations which take leadership development seriously outperform their competition. This holds greater truth today when leaders in this cyber age fi nd themselves under greater (and increasing) pressures from globalisation. Twenty-five years ago, very little attention was being paid to the idiosyncrasies and irrational processes that make up individual behaviour. Corporations and business schools were preoccupied with models of the rational economic man, not realising that executives are everything but rational decision makers. The emotional aspects of leadership and the importance of corporate culture were all but ignored. Leaders at that time were expected to simply leverage their vision and skills to create sustainable, results-oriented organisations. Today they face added complications of rapidly changing technology, virtual working teams separated by cultural and geographical

boundaries, and the difficulties of making decisions when faced with an overload of information. Recently, a former participant from one of my Challenge of Leadership (COL) programmes approached me at a fundraising event in Holland and introduced himself. It had been 15 years since he took my class and I couldn’t place his face. But always being on the lookout for feedback, even many years on, I asked him whether the programme had had an impact and he told me that yes, in fact it had taught him three things. In the fi rst place, it helped him have the courage to quit his job and become an entrepreneur which had made him very wealthy. Secondly, it made him change his relationship with his son, which turned out to be a very good investment and, thirdly, he had learned how to be more effective in speaking up – to work out what it was he wanted to say, and to have the confidence to say it. In fact, what happened to him during the COL programme were three tipping points, the kind of “aha” moments that give people the insights they need to change or develop their behaviour in a way that better supports their personal and organisational goals. When I created the programme I had in the back of my mind the ceo-mag.com / Spring 2016

“fantasy” to make INSEAD the foremost business school in “soft skills,” which (when it comes down to it) are the “hardest skills.” Organisations have followed this fantasy over the last 25 years too, because they’ve realised that it’s critical to success. Modern organisations look more and more like a matrix star ship, where many ideas develop and the challenge in putting these ideas into action becomes a very different story. Vision without action is a hallucination, and execution is where many well intended decisions get bogged down. To make things happen - to arrive at seamless execution - requires a leadership model that is less autocratic and more of an authoritative and networking nature. We h ave moved f rom t he “Com m a nd , Control, Compartmentalisation” way of leading organisations to a more interactive, informative, and innovation-oriented model. To be truly effective, today’s organisations need to have leaders who have the emotional intelligence to create meaning, and have the capability to inspire and empower their people to get things done. This becomes especially difficult when the members of an organisation are spread across different continents. After all, you can’t email a smile or a handshake. You need to create places of work where people feel comfortable in a network structure; you need to create organisations where people can have courageous conversations organisations with people that are adaptable, selfaware, collaborative, resilient, and have a systemic orientation. To create these agile organisations we need people that practice true knowledge exchange and will go beyond silo thinking. Why are so many leaders self-destructive? As executives climb higher up the corporate ladder these soft skills become even more important. It is no longer enough to be a functional manager. Ultimately, leaders need to get out of their functional silo to be able to get the best out of people. Unfortunately, many executives fail to rise to the occasion - they simply don’t know how. The question I often asked myself 25 years ago, and continue to ask myself today is: Why are so many leaders self-destructive? Why are so many executives so poor in developing well-functioning teams? Why have so many organisations a gulag quality? The truth is, despite having a greater awareness of their role, many successful leaders still share a great sense of anxiety and insecurity, and many are very unaware of the effect their actions have on others. Basically, they have very little idea what they are all about. They are strangers to themselves. And due to their insecurities they may resort to highly dysfunctional behaviour. Also, many of these overachievers are continually asking themselves, am I good enough? Am I up to the job? When will people realise that I shouldn’t have this position in the first place? This is known as the imposter syndrome. Some compensate by becoming more narcissistic ceo-mag.com / Spring 2016

in their behaviour to convince themselves and everyone else that they are truly special. They may suffer from hubris, contributing to irresponsible actions. Some of them resort to an alpha male, silver backed gorilla style of leadership. While leaders have had to become more sophisticated over the past three decades to improve their horizontal communication to get things done, in times of stress they can regress very quickly and fall back into this kind of autocratic behaviour as a default pattern. At the COL programme (run over a four week period over a year) we bring very senior executives together to learn from each other, and to help each other become more reflective in action on a day-to-day basis by asking themselves what they are doing and how they are doing it before they act. Through the use of the “life case study” (meaning they are the cases), they become more self-aware in terms of why they are doing what they are doing. COL follows the old injunction: “Know Thyself.” By focusing on conscious and unconscious behaviour, as well as rational and irrational action, they learn to prevent irrational and dysfunctional processes in their companies. Eventually, the methodology learned from COL contributed to the creation of INSEAD’s Global Leadership Center (IGLC); it made INSEAD the leading business school in the world in group coaching; and it also created the foundation for the Executive Master’s in Coaching and Consulting for Change (EMCCC), a successful programme now given on two continents. People “transformation” turned into one of the five principal pillars of excellence that distinguishes INSEAD from other business schools. The changing role of leadership Today’s corporate world is going through a shift not seen since the second industrial revolution. The enhanced capabilities and affordability of technology caused by digital innovation has led to fundamental changes in how business is conducted, organisations are managed, and consumers behave. As the world is changing, leadership is no longer defi ned by what a single leader does (the “Great Man” theories) but by the ability to collaborate, motivate and to manage networks. Leadership has become a team sport; leadership behaviour needs to be distributed throughout an organisation. Leadership success today has to do with the way people think, the way they feel, and the way they behave in a responsible manner. This is more than charisma and it is not something that can be learned in three easy steps or over a single programme. Strong leadership requires continuous development. Clever people don’t necessarily become wise. But they can learn how to fi nd ways to cope with stressful experiences by getting to know themselves. It’s always good to keep in mind that leaders are like wine: Some turn out great; others may turn into vinegar!

“It’s always good to keep in mind that leaders are like wine: Some turn out great; others may turn into vinegar!”

BIOGRAPHY Manfred Kets de Vries is founder and programme director of The Challenge of Leadership Programme, one of INSEAD’s Top Executive Development Programmes. He founded INSEAD’s Global Leadership Center, and was one of the creators of the Executive Master’s in Coaching and Consulting for Change. ACKNOWLEDGEMENT Courtesy of INSEAD Knowledge. 47

MBAs

LIST OF CONTRIBUTORS A

Australian Institute Business

California State University, San Bernardino Jay Clayton Carlos Cordon Tony Coulson

Alina Dizik

Tim Murphy

Vincent Nestler

Felix Offodile Chris Outram

Francis Petit Misiek Piskorski

Alon Rozen

Ecole des Ponts Business

Fordham Graduate School of Business

Daniel Garrie

IMD Business School INSEAD ISEG â&#x20AC;&#x201C; Lisbon School of Management and Economics

Kent State University

R S

Craig Seal John Squires

The University of Chicago: Booth The University of Pennsylvania Wharton School Frances Townsend Dominique Turpin

Manfred Kets de Vries

David N. Lawrence 48

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Viktor Göhlin Founder, Nokadi Alumnus 2006

Emilija Petrova Managing Director, Trade Resource GmbH Alumna 2002

Bart van Straten General Manager, Van Straten Medical Alumnus 1996

YOU!

Roxana Flores Founder, BeCaridad Alumna 2011

Peter von Fortsner Managing Director, Häusler Automobiles Alumnus 2010

Supareak Charlie Chomchan

Managing Director, Pacific Rim Rich Group Co., Ltd. Alumnus 2003

At EU Business School, you don’t just learn from entrepreneurs, you become one! Business school is where you build good habits, learn the theory, pick up practical skills and obtain the knowledge necessary to put your ideas into action. You need a business school

that will help you develop both as a businessperson and as an entrepreneur. At EU Business School, we make a difference in students’ lives and propel them to success. PEOPLE HAVE IDEAS. ENTREPRENEURS MAKE THEM HAPPEN.

BARCELONA | GENEVA | MONTREUX | MUNICH | ONLINE 4

ceomag.co.uk / Spring 2016