Prospectus - Spring 2009 by ISU College of Business

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ON THE COVER IOWA’S SMALL BUSINESS DEVELOPMENT CENTERS ARE HELPING IOWANS GET BACK ON THEIR FEET AFTER ONE OF

THE WORST DISASTERS IN THE 2 Dean Labh Hira 26 Faculty Perspective �� STATE’S HISTORY. PHOTO BY 21 Briefs 28 Development LIZ MARTIN, THE GAZETTE. 25 Alumni News 32 Dr. Charles Handy

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M ESSA GE FR O M THE DEA N

Managing Uncertainty The news about the financial crisis facing our country feels like it gets worse almost every hour.

I am confident we will emerge from these changing times a better, smarter college.

Nobody seems to know where the bottom is, when it will come, or if we’ll even recognize it when we get there. Indeed, about the only thing we can be certain of right now is more uncertainty. In times like these, communication is important. So I want to share with you how the College of Business is managing its uncertainty. We are fortunate to be in Iowa, a state that, to date, has not been affected nearly as badly as most. Similarly, our college is relatively well-positioned to deal with downturns; we are good stewards of our state appropriations and the funds of our donors, and we have a very lean body of faculty and staff compared to many of our peers. As of this writing, we have been able to withstand our budget cutbacks with minimal disruption to our operations, mostly through reducing supplies and travel expenses, and not immediately filling vacant positions. And despite the economy, there are positives to report. Applications at both the undergraduate and graduate levels are up. We expect a strong inaugural class for our PhD program this fall.

We are optimistic that we will meet this year’s goal for Campaign Iowa State, which has continued to thrive. And while campus recruiting has understandably declined, employment rates among our new graduates have remained remarkably strong. But as we know, there are no guarantees in this environment, and those situations can change quickly. We know that the 2009-2010 fiscal year will almost certainly bring deeper budget cuts; indeed, by the time you read this, we will know just how deep. In the short term, revenue from differential tuition, described in detail on page 21, will help soften the blow. Differential tuition is when a college charges a rate of tuition above that of the university. It is becoming more common among business schools, and it will be implemented for College of Business juniors and seniors beginning this summer. Revenue from differential tuition is slated for use in hiring more faculty to reduce 300-level core class sizes, which is supported by our students and is crucial to improving their learning environment. The worsening budget situation, however, may prevent us from making as many hires as we otherwise would, until the economy improves. I am extremely grateful for our dedicated faculty and staff, who continue to deliver an outstanding product to our students in a difficult environment. I am equally thankful for our alumni and friends who continue to support us. Our students impress me every day, and we must continue to put them first. The days and months ahead will be challenging, but they will also force us to innovate and explore new ways to do business more efficiently—while remaining committed to improving our programs and opportunities for students. I am confident we will emerge from these changing times a better, smarter college. ■

Labh S. Hira, Dean 2

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After flood the

Iowa’s Small Business Development Centers respond to the storms of 2008—and prepare for those to come

Maybe the date should have told him something. But when Jim Heckmann took the reins of Iowa’s small business development centers on September 11, 2007, he had no idea his job would be much different from his previous career.

Flood waters that topped 20 feet above flood stage inundated downtown Cedar Rapids with water in June 2008. This shot captures May’s Island and the Federal court House. Photo by Steve Gravelle, The Gazette.

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or more than 20 years after law school at the University of Iowa, Heckmann practiced in Dubuque. He didn’t do divorces; he didn’t do criminal work or real estate. Instead, Jim Heckmann was a business attorney, specializing in acquisitions, mergers, divestitures, and such for firms large and small, both locally in Iowa and in the power centers of the east and west coasts. Ask Heckmann and he’ll tell you that it wasn’t the litigation that got his juices flowing, but instead what he calls “preventative law”—in short, counseling business clients and helping them to arrange their affairs in a way to minimize the possibility that they might find themselves in court, dealing with what should have been a foreseeable disaster. And so, in 2005, Jim Heckmann left his legal practice to hang his shingle as a business consultant. “The idea,” Heckmann says, “was to get rid of that part of the law I didn’t really like—litigation mostly— and keep the part I really enjoyed.” So when Heckmann 83 of 99 arrived in Ames that Iowa counties September 11, he had no were declared reason to assume anything disaster areas other than a smooth transition into directing the SBDC’s fifteen satellite offices statewide, dedicated to helping both new and existing small businesses learn the ropes and avoid the predictable pitfalls

Jim Heckmann

that swamp—and eventually finish—most small startups. And for his first eight months on the job, that’s precisely what he did, until May 25, 2008.

‘I could see daylight ...’

Virgil Goodrich

A retired school superintendent, Virgil Goodrich serves as the part-time economic development director for Parkersburg, Iowa, a bedroom community of about 2,000 people 30 miles northwest of Cedar Falls/Waterloo. The day before Memorial Day had been a fairly typical Sunday for Goodrich and his wife—church in the morning, nine holes of golf in the afternoon. The storm watches coming over the television that afternoon were typical as well for late spring in Iowa. But May 25 would be anything but typical for Goodrich and the people of Parkersburg. “At ten to five the lights went out and electricity went off,” Goodrich recalls. “It was getting worse and worse, so we moved from our family room to the other side of the basement, where there were fewer windows. Then, about 7 or 8 minutes before the tornado hit, a young woman and her two small children came pounding on our back door, looking for shelter.” Goodrich didn’t hesitate and, along with his wife, shepherded the woman and her children into their basement to brace for the storm.

SBDC: An Economic Driver for Iowa Since its inception in 1981, the Iowa Small Business Development Center (SBDC) has spent 363,000 hours counseling over 62,000 clients. In 2008 alone, the Iowa SBDC spent 13,217 hours counseling 2,238 clients. These clients added or retained 1,037 jobs and raised over $76 million in capital for their businesses. They also contributed $5.41 in new federal and state taxes for every tax dollar invested in the Iowa SBDC program. • Contributed $15.5 million in new state taxes through increased sales and employment. • Increased firm gross revenues by $206 million. • Added and retained 4,403 jobs. • Raised $130 million in new capital. • Grown 4.4 times faster than the average Iowa business.

When Goodrich finally emerged from the basement he could see that his house, his neighbor’s, and virtually every other structure in his neighborhood was gone.

“As it was blowing over,” Goodrich says, “I knew we were in trouble—I could see daylight from the basement.” When Goodrich finally emerged from the basement he could see that his house, his neighbor’s, and virtually every other structure in his neighborhood was gone. They couldn’t find the young woman’s car, so just walked for an hour, surveying the wrecked town. But as devastating as the wrecked homes and businesses were, there would be worse news: six Parkersburg residents perished in the tornado, along with two others just down the road in New Hartford. “Ever since,” Goodrich reflects, “we’ve been picking up the pieces. We started to rebuild and clean up and move on.” Tornadoes claimed 13 lives in Iowa in 2008, including nine in the ParkersburgNew Hartford EF5; five confirmed flood-related deaths were reported

Record rainfalls, record floods However, Parkersburg was not the end but only the beginning for Iowa—and for the SBDC and its new director. The storm that brought an EF5 tornado to Parkersburg and other Butler County residents was just one part of a vast system, the starting shot in a race to respond to a rolling tide of natural disasters unprecedented in Iowa history. The Parkersburg tornado was accompanied by 4 to 6 inches of rain, causing flash flooding across a large swath of northeast Iowa. Continuing heavy rains would lash the state over the next month, sending the Iowa and Cedar Rivers and their smaller tributaries over their banks, breaching levees and inundating cities and small towns.

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‘IT WAS OUR LIFE ...’ Nancy Barta: The Saddle and Leather Shop, Cedar Rapids

The May 2008 EF5 tornado that struck Parkersburg, Iowa, damaged or destroyed hundreds of homes and businesses. © James M. Heckmann, 2008. Used with permission.

On June 8, the Iowa River passed flood stage at 22 feet (it would crest one week later at a record 31.5 feet), flooding Mason City in the north central part of the state—a portent of what was to come for communities downstream. By Wednesday, June 11, water began rising from the storm sewers in Cedar Rapids: by Friday morning, the Cedar River would also crest at 31.5 feet—20 feet above flood stage. It wasn’t supposed to happen. Much of Iowa had already experienced what was then called a “100-year flood” in 1993; now, only 15 years later, some meteorologists were calling 2008 a “500-year flood.” And, in the face of increasingly unstable weather patterns attributed to global climate change, others were saying that such designations were increasingly meaningless. Nancy Barta certainly wasn’t expecting it. The co-owner of the Saddle and Leather Shop in the Czech Village neighborhood of Cedar Rapids had done everything she was supposed to do. On Tuesday, June 10, she and her friends and family had sandbagged around the store. By Wednesday all of the stock—about $750,000 worth—had been removed from the basement and raised at least two feet off the main level. “Wednesday night at 9:30, I pulled up in front of the building with my brother-in-law,” Barta recalls. “We went down into the basement to see if water was backing up the floor drain—and it was. “At 1:30 Thursday mornNine Iowa ing,” she continues, “the rivers crested burglar alarm went off and at record levels water was waist-deep on the main floor, and I couldn’t get any closer than a block away. The current was so incredibly strong.” Barta sighs, and adds, “We weren’t supposed to have any water.”

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THE IRONY isn’t lost on Nancy Barta: 2008 was the 100th anniversary of her store, located in the Czech Village neighborhood of Cedar Rapids. So naturally it took nothing less than a 500-year flood to sink the business. Barta’s father bought the place in 1946, then turned it over to Barta and her sister in 1985, he continued to work until retiring in 2003—at age 90. “Our relationship to horses was genetic,” Barta says. “My dad knew he wanted to ride from the time he was 13, and my sister and I inherited that. He didn’t quit riding until 85. “The three of us rode together every week,” she continues. “We ate together, we rode together, we played together, we worked together. It wasn’t just a business or even a livelihood: it was our life.” Even if her business is sunk—and that is not settled— Barta’s fierce commitment to her way of life is enough to convince you that she is far from finished. She fought to save her shop from the rising waters, and she fought just as fiercely to salvage what stock she could—clothing, saddles, harnesses, bridles and boots—and clean it up for resale at discount. Still, at 54, with hundreds of thousands in losses, no flood insurance and no heir to run the business, Barta has been forced to take stock of herself, with the assistance of SBDC disaster recovery counselor Steve Sprague. “The longer I went in this process, the more help I needed to come up with options,” Barta relates. “I could call the SBDC. I could say, ‘where do I go from here?’ They would meet me; they would help me with all kinds of research.” Barta and Sprague developed an outline of the challenges she faced. Sprague also helped her compile information about the riding industry, which helped Barta to better understand the her larger market. But most of all, Barta says, Sprague and the SBDC helped her to look beyond her losses and focus on the assets she had to rebuild her life, the strength and knowledge that no flood could take from her. “I had never given myself that kind of credit,” Barta reflects. “Steve was invaluable in pointing out the assets a person brings from really doing only one thing in their whole life.”

The director gets his feet wet, hands dirty Heckmann, meanwhile, was dealing not only with Barta’s issues but his own. He made inspection tours to Cedar Rapids and Oakville, Wapello and hard-hit areas near his former home in Cedar Rapids Dubuque. He consulted recorded 24.09 colleagues who had inches of rain earlier helped clients for 2008, more after Hurricane Katrina than 10 inches and the EF5 tornado above normal that had demolished

Greenburg, Kansas, in 2007. He was on the phone constantly to his regional directors, getting reports from the front lines and asking them what they needed to service their clients. “We talked about it at length,” Heckmann says, “and began to realize that we were not going to be able to handle the needs of small businesses for the kinds of work that we do with the current resources we have.” The SBDC, after all, was in the “business counseling” business, not disaster recovery. Heckmann was in the business counseling business. His and

‘WE GOT OUT WITHIN JUST HOURS ...’ Nancy Lekin: Alter Commercial Caseworks, Burlington ALONG WITH her brothers Mark Alter and Bill Alter Jr., Nancy Lekin started Alter Commercial Caseworks in Burlington just three years ago. The brothers were the “talent”— both had been skilled union carpenters and supervisors—and Lekin the business brains, having worked in management with several different firms. Business was good. In fact, only the limited floor space of their shop two blocks from the Mississippi River kept them from hiring more than four employees beside themselves for their work doing custom cabinets and architectural millwork. But then came June, and the waters inexorably made their way toward Burlington. “I’m from Cedar Rapids,” Lekin says, “so I was aware of what was happening. Also, we were doing a job in Iowa City and running into water wherever we went. Our landlord didn’t think it would come as far

as us, but we could tell when we moved in that there were water lines on the wall from ’93.” The siblings also had a guardian angel: the man whose business occupied their space during the floods of 1993 contacted them, and informed them exactly at what flood stage the water would start coming in. He also told them not to bother with sandbagging: the water would rise from beneath the building, and sandbags wouldn’t make a difference. “That saved us,” Lekin says. “If we had wasted time sandbagging, we would not have gotten out in time. As it was, we got out within just hours from when the water came in.” They managed to save about $100,000 in equipment, but the building—along with the thousands they’d invested to convert the space to their needs—was lost. Still, with the help of the SBDC, they are quickly getting back on their feet.

“The SBDC has been helpful to us even before we opened,” Lekin says. “[Burlington director] Janine Clover helped with our business plan, she helped get our financials ready— she‘s helped us throughout the three years we’ve been in business.” And, Lekin adds, Clover was there when it counted. “I didn’t have to worry about anything but how to get us up and running again, because she was there looking for ways to help.”

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“We began to realize that we were not going to be able to handle the needs of small businesses with the current resources we have.” — Jim Heckmann

SBDC counselor Kelly McCarty works with a victim of the Parkersburg, Iowa tornado. Courtesy of the UNI Regional Business Center/SBDC

the centers’ job was to help small businessmen and women with business plans, marketing, financing, and other routine startup and operational issues, not with shops reduced to piles of debris or inventory swimming in five feet of water. Still, Heckmann says, being only a fair-weather friend to small businesses was never an option: for many of their clients, the SBDC was the only ally they would have over the long haul. And it wasn’t exactly as if Heckmann or his area directors were themselves immune from disaster. “I was on the phone that Friday with my directors and the SBA district director, Joe Folsom, whose office is in the federal building in Des Moines, two blocks from where I live,” Heckmann recalls. “In the middle of the call, Joe says, ‘Jim, I don’t mean to interrupt, but they just issued a voluntary evacuation order for our neighborhood down here.’”

Heckmann raced Other parts of home from Ames to Eastern Iowa within spend the rest of the the Cedar River day sandbagging watershed recorded downtown Des Moines from 15 to 20 inches with hundreds of other of rain between volunteers. Yet while May 10 and June 10 the waters circling his home reached street level, they didn’t top the levee at the Grand Ave. bridge for the simple reason that, early the next morning, the levee protecting the Birdland neighborhood two miles upstream broke, flooding the area’s modest homes and small businesses, thus sparing downtown Des Moines. “We were lucky because somebody else was unlucky,” Heckmann acknowledges. If he didn’t know it before, he surely did then: the times required him be more than just a “business counselor,” and the SBDC to be more than just a fair-weather friend.

When demand exceeds resources

It was not simply a question of empathy but resources: how, in the face of disaster, could the SBDC fulfill a mandate to serve beyond its core mission?

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Even if Heckmann hadn’t yet fully empathized with the plight of the SBDC’s clients in eastern Iowa, the rising floodwaters in Des Moines drove the urgency of the moment home to him—literally. Yet it was not simply a question of empathy but resources: how, in the face of disaster, could the SBDC fulfill a mandate to serve beyond its core mission? A mandate that increased daily with

“I had a little inkling of what we were going to be looking at. It was just the scope of it that was—and still is—overwhelming.” — Steve Sprague

Steve Sprague

the spread of the floodwaters, but Iowa’s agricultural would only remain— economic losses and even grow—long were estimated to after those waters exceed $2 billion had receded? “It became clear we were going to have a demand on SBDC services that exceeded what we could handle with the resources we had,” Heckmann remarks. As a relative newcomer, Heckmann wasn’t even aware at the time of the disaster assistance programs of the Small Business Administration, SBDC’s parent organization. So regional SBA director Folsom took it upon himself to educate Heckmann, who in turn would bring his regional directors up to speed. It was obvious they would need additional counselors: Dubuque, Waverly, Iowa City-Coralville, Burlington, and especially Cedar Rapids were all in need of emergency assistance. But that meant money. Heckmann told his directors to put together a month-by-month budget for the next three years. After the numbers were crunched, he determined that the Iowa SBDC would need a minimum of $1.8 million to support small businesses stricken by the floods and tornados, so got on the phone to SBA in Washington. “They told me that they had only $200,000 in unobligated funds,” Heckmann says. “And the hurricane season hadn’t even hit yet.” Undeterred, Heckmann and Folsom lobbied Iowa’s Congressional delegation for support through federal emergency relief funds, and by August Congress had committed no less than $10 million nationwide for small business disaster recovery. With a $458,000 allocation of emergency funds from the SBA until the federal monies were actually appropriated, Heckmann and the SBDC went to work.

Off the scaffold and into the flood Steve Sprague, who had served as director of the Kirkwood SBDC office in Cedar Rapids for twelve years, had barely been retired half a year when he got the call in July. “I had a lot of connections in the community and had worked with a great number of businesses over those twelve years,” Sprague observes. “And I was familiar with the paperwork for people receiving commercial loans and aware of the SBA loan programs. So it was a matter of coming down off the scaffold on the side of my house and learning the requirements for the disaster loan programs.” Through a happy coincidence, Sprague was able to hit the ground running when he came off his scaffold: in 2007, just before he retired, he and his fellow SBDC directors had gone through disaster recovery training with the Department of Homeland Security, as had all Iowa SBDC directors in 2007. “So I had a little inkling of what we were going to be looking at,” he says. “It was just the scope of it that was—and still is—overwhelming.” Sprague would dive headfirst into a service model radically different from any he had worked in previously, one designed to meet the urgent and particular needs of clients under tremendous stress. Adopting a model not used since Hurricane Katrina, he and the SBDC regional directors from Iowa City and Cedar Rapids established a joint

A city building in Oakville, Iowa, after record flooding devastated the small community. © James M. Heckmann, 2008. Used with permission.

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Business Recovery Center, with offices in both of the stricken cities. There, small business owners impacted by the floods found, under one roof, representatives not only of the SBDC, but also the SBA, IRS, FEMA, and SCORE (formerly Service Corps of Retired Executives), as well as city, county, and state disaster recovery officials. The object of the clustered offices, says Heckmann, was simply to deliver the level of service the circumstances demanded: instead of sending stressed-out people across town with a referral, officials with any one of the organizations could walk them over and introduce them to counterparts from other agencies to ensure they got the help they needed immediately, whether with loan applications, counseling, cutting red tape, follow-up appointments, or anything else they needed to speed recovery. “We got comments from Washington,” Heckmann notes, “that the SBA and SBDC working together in this disaster was the best example of resource partners they had ever seen.”

‘We held their hands’ The Cedar Rapids BRC was in Westdale Mall on the city’s northwest side, where Sprague and his counterparts worked six days a week providing whatever services they could in navigating flood victims through the various disaster recovery programs. “We reconstructed financial statements for some people,” Sprague notes. “And we held their hands. Some who had their businesses affected were relatively young and The Cedar Rapids robust, but others were city hall, Linn County in their eighties.” jail, fire department, In focusing on police communicathe relatively “dry” tions equipment, business of damaged most of the public inventory, capital equiplibrary’s collection, ment, balance sheets, and 3,900 homes and loan applications were all under water after a natural disaster, Sprague stresses, it’s easy to lose sight of the gut-wrenchingly human aspects of loss as experienced by small business people, most of whom run family-based enterprises.

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A U.S. Small Business Administration worker surveys the damage in Parkersburg. Courtesy of the UNI Regional Business Center/SBDC.

While conceding the 22 levees were need for risk managebreeched as of ment as part of any good June 20, 2008 business plan, in this regard Jim Heckmann offers an important distinction. “The effort you spend on risk management depends on your exposure and your potential loss,” Heckmann points out. “A Rockwell Collins spends a lot more time, money, and energy on disaster planning than a popcorn shop on Main Street. That’s because they have more resources to throw at something like that—and the risks are bigger. “Personally, though,” he continues, “it can be a much more serious loss for a small Main Street business than a big corporation that has better access to capital and insurance products and so forth. So disaster planning should be a part of what every business does.”

Falling between the cracks The particularly cruel nature of the disaster’s effects on small business owners—as well as the

“Disaster planning should be a part of what every business does.” — Jim Heckmann

A fire truck tries to navigate through downtown Cedar Rapids amidst the worst floods in the city’s history. Photo used with permission of the Cedar Rapids Chamber of Commerce.

Mike Hahn

shortcomings of government’s capacity to respond—is no better illustrated than in the market for residential rental property. As with many urban flood plains, directly impacted areas in Cedar Rapids were made up largely of small businesses and a disproportionate stock of residential rental units—4,000 in Cedar Rapids alone, according to Sprague. Yet despite providing housing for thousands of renters hit by the flood, Sprague says, the Federal Emergency Management Agency offered landlords no assistance because it considered them to be “businesses” rather than homeowners. Conversely, the State of Iowa considered them landlords who provided housing rather than “business owners” who might otherwise be eligible for direct state aid in the form of grants under the Jumpstart Iowa Recovery Initiative, which supports only singlefamily, owner-occupied dwellings. “Those were, in many respects, the people who were damaged the worst, and in the worst position to recover,” Sprague says of the owners, who typically held no more than four or five rental units. “The older ones depended on this for retirement income, and many of the younger ones were highly leveraged—any funds they had were tied up in this property that now has no value.” Whether landlords, retailers such as Nancy Barta, or service providers such as Nancy Lekin and her brothers (see page 6), the intense personal identification between owner and business is only further complicated by age and family issues. All three of the business owners profiled in this article are approaching traditional retirement age, and the businesses they run are all significantly impacted by family considerations.

Mike Hahn, director Significant areas of of the Cedar FallsCedar Rapids were Waterloo SBDC office flooded beyond the at the University of so-called “500-year Northern Iowa, notes flood level” of that a recovery process 26.5 feet that is already timeconsuming due to the inevitable bureaucratic red tape is only further extended when family is factored into the equation. And this, Hahn says, is only after the business owner first deals with the most immediate concerns—food, shelter, health, even survival— of his or her family members in the immediate aftermath of the storm. “That took some time,” Hahn recalls, reflecting upon his experience with survivors of the Parkersburg tornado. “And once those essentials were taken care of, there were decisions that slowed the process down: needing to talk with family members, father-son relationships, husband-wife relationships, which direction they were going to go as far as rebuilding the business—or if they were even going to rebuild the business.” After all, Hahn observes, while most of his tornado victims were covered by insurance, few of the businesses devastated by floods had policies to cover their losses. In those cases, he says, the assumption of considerable new debt that would be difficult for any small business owner becomes even more burdensome for those approaching retirement and without a family member willing to take over the business.

No easy answers Neither Jim Heckmann nor his regional directors or emergency counselors have any easy answers for people facing hard choices. Some businesses will

A recovery process that is already time-consuming due to bureaucratic red tape is only further extended when family is factored into the equation.

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‘HANG ON, WE’RE GOING FOR A RIDE ...’ Larry Luhring: Luhring Monuments, Parkersburg IF DIVERSIFICATION is a bulwark against disaster for a small businessperson, then Larry Luhring of Parkersburg is your man. Together with wife Martha, Luhring has been in the monument business for 25 years. In addition to a part-time flower shop they operate in the spring, they’re also franchisees of Dish Network and Iowa Wireless. So between monuments and flowers, Memorial Day 2008 should have been a banner opportunity for the Luhrings. And it was, until the sirens chased the Luhrings to the basement. “We had one of those windspeed weather vanes sitting outside our basement window,” Luhring recalls, “and it just started twisting. Marty said, ‘my ears are starting to pop’. I said mine were, too—and that I thought we were in trouble. I told Marty to hang on, we’re going for a ride.”

The Luhrings hung on as their home and businesses disappeared into the sky. Bruised and battered, they emerged to discover the body of a neighbor; they later learned that Larry’s brother, Herman, was severely injured, and that his wife, Shirley, had perished in the storm. Months later, Parkersburg has buried its dead. Area officials such as economic development director Virgil Goodrich and SBDC director Mike Hahn continue working to restore the town’s devastated businesses. Yet Parkersburg’s greatest asset is not that most of the businesses were insured or the government

recover pretty much as they were. Some businesses will not survive. Still others will be forced to adapt and change their basic business models. But that can be a good thing, says Sprague. Many small family-based businesses get stuck in a rut, he notes, and don’t keep up with the markets and the competition. Many never adapted to the rise of the Internet, and have watched their customer base steadily erode as consumers sought discounts online. And, whether flooded or not, all are menaced by the storm clouds of a deepening worldwide recession. “In some respects, the businesses that survive are going to be better because they’ve been through this Official damage estimates for Iowa’s 2008 floods and tornados, including agricultural losses, range from $8 to $10 billion

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agencies, but the sheer resilience of its people: within weeks, the Luhrings had reopened their business in a location that had escaped the storm’s fury. And, with the help of the SBDC, they’ve obtained an SBA loan to help rebuild. “We were very happy with that,” Luhring says. “And we were happy with the dollar amount. We never thought we’d have to use the full amount, but we did.” Like others dealing with government agencies after a disaster, Luhring has strong opinions about the limited scope of relief programs and the inevitable red tape involved with taking advantage of them. Still, he’s grateful to have an ally on the ground locally. “One reason I’m sticking with SBDC is the low interest rate on a 30-year loan, yes,” he remarks, “but also the economy, which scares the heck out of me just now.”

crucible of having to make very difficult choices,” Sprague says, and points to Barta as exhibit A. “It’s the frustration of people trying to select an avenue for recovery,” he continues. ‘What’s my new business going to look like?’ And, of course, that’s been Nancy’s focus. She was confronted with, ‘Do I go back and do things the way they always were done? Or do I sharpen myself and my skills and go after what’s going to be most successful and produce the greatest revenue?’” Through the counseling process, Sprague has helped Barta to focus not simply on what she has lost, but more importantly upon her remaining resources— especially those that transcend the burden of an SBA loan that might not make sense for a woman little more than ten years from traditional retirement age, and without a child or other family member willing to assume responsibility for the business.

Heckmann and his staff continue an aggressive program of outreach and follow-up to the immediate victims of the storms.

“The Internet experience is a huge void in her consulting portfolio, but there’s a lot Nancy does know,” Sprague stresses. “Often, when faced with a disaster in terms of what they traditionally do, business owners forget that not only is it customers and techniques, but knowledge they’ve acquired that they think is common but isn’t. That, in fact, may be one of their greatest skill sets. “I said, ‘Nancy, you have as much expertise in your field as practically anyone around.’ So we considered if she should take her knowledge, and then take some of the modern capabilities of distribution in the United States, to become the artisan of choice in the Midwest for the repair of expensive horse tack. “That’s the definition of expertise,” Sprague concludes. “That’s why all the professors who retire become consultants.” The Cedar River crested at over 32 feet on Friday, June 13, exceeding the record from the historic flood of 1929

Anticipating the storms to come Months out from the storms of 2008, Jim Heckmann reflects upon the past year. He knows that Nancy Barta and other small business owners in eastern Iowa are not the only ones impacted by the floods, nor are they the only ones who must adapt and change in order to survive—let alone thrive—in a radically transforming economy. The snowfall over northeastern Iowa was, once again, well above average this winter. The ground is saturated, and heavy spring rains could once again send Iowa’s rivers over their banks into the cities and towns. Even if this doesn’t happen, the rising global tide of bad economic news threatens

to inundate those small businesses that managed to stagger to their feet after the floods of ’08, as well as their previously unaffected counterparts. Flexibility is paramount in such times. Diversification is needed as well, and the vision to see what’s coming—and to prepare for it. “Every disaster has its own unique chronology of need,” Heckmann says, “and we had to figure out what our chronology of need would be. In that sense, we were lucky this was a moving disaster. We watched very closely what was going on in Mason City, so by the time it got down to Burlington, we could tell people ‘at two weeks this is what’s going to happen, at three weeks this is what’s going to happen.’” That same capacity for foresight—of knowing where the waters were and where they were headed— enabled Heckmann and his staff to anticipate the needs of clients months in advance, both those impacted immediately by the storms and those to follow, including those businesses that depended economically on their less fortunate colleagues, but who wouldn’t feel the pain until months later. “And that’s exactly what happened.” Heckmann reminds. “We knew these third-tier businesses would start coming in to see us the last quarter of 2008, and will probably continue through the first half of this year.” Whether that foresight will serve the SBDC as well in the future only time—and events—will tell. But just as with his In Cedar Rapids, own professional life, water covered Heckmann knows that 1,300 city blocks, the SBDC must or 9.2 square miles embrace a service model that demands it change as surely as emerging crises change the lives and businesses of their core clientele. In the meantime, he and his staff continue an aggressive program of outreach and follow-up to the immediate victims of the storms and to their counterparts “downstream” of the flood, now in time if not in geography. And, in an age of economic uncertainty for all, they continue to look to the horizon for the gathering clouds. ■

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‘WHEN IT FEELS RIGHT,

I GIVE’ An Interview with Russ Gerdin

Russ Gerdin trusts his instincts. If you had Russ Gerdin’s instincts, you’d trust them too. After all, they helped him build his company from a tiny operation into an industry leader. And they have guided him and his wife Ann as they have sought out philanthropic opportunities in recent years.

The Gerdins are best known to those at Iowa State for their $10 million gift which made possible the construction of the magnificent, five-year-old Gerdin Business Building. It would not be hyperbole to suggest that their gift changed the course of history for business education at Iowa State. In business, Gerdin will tell you, his instincts have led him into the occasional mistake. But in philanthropy, he’s proud to say his instincts have been spot-on every time. When Gerdin was visiting the College of Business in April 2008 for a meeting of the Dean’s Advisory Council, his instincts kicked in again. The council heard presentations that day about the college’s new PhD program, which launches this fall, and the Gerdin Citizenship Program, now in its second year of engaging freshmen and sophomore business students in activities that build key professional skills. When the presentations concluded, Gerdin made an announcement that caught everyone— himself included—by surprise: he and Ann would contribute $1 million to the PhD program and $100,000 to the Gerdin Citizenship Program. They would also give $100,000 to Cyclone athletics.

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While the decision may have been spur of the moment, Gerdin says the foundation for that decision comes from a belief in the mission of the College of Business and an underlying trust in the leadership at Iowa State. It is an investment, he says, in educational opportunities for Iowans.

Today, Russ Gerdin continues to serve as chairman and CEO of Heartland Express, the trucking firm he built from the ground up into one of the nation’s largest. He turned over some of the day-to-day operations to his son Michael after he was diagnosed with liver cancer in 2006. His experience in treatment led the Gerdins to pledge $4 million to create the Russell and Ann Gerdin American Cancer Society Hope Lodge in Iowa City, where families can stay without cost while loved ones receive cancer treatments. The Gerdins have also been generous supporters of the University of Iowa and Hurricane Katrina relief, among other causes. Prospectus sat down with Russ Gerdin at Heartland Express’ corporate headquarters in North Liberty, Iowa, for a candid conversation about his business, his thoughts on Iowa State University, and his perspective on philanthropy. Ten years ago, you announced the largest gift in the history of the College of Business. How did you arrive at that decision? Ben Allen [former College of Business dean, Iowa State provost, and now pres-

Russ Gerdin built Heartland Express from a small operation with a handful of trucks to a $600 million per year industry leader.

We feel that what we’ve been able to accumulate has been because of all the efforts of the good people of Iowa. This was the best place to give back what we had gained.

ident at the University of Northern Iowa] and I are friends. He is on our board, and was at that time too. Maybe three years prior to that, I went to one of his presentations to the Cedar Rapids shipping public. I didn’t even know him at the time, but when the meeting got over I went up to him and introduced myself—here is the off the cuff thing again—and said, “I would like you to consider joining our board.” He said he would be honored. And that is how we started our relationship. And from there on, I noticed what he was doing at the college, and it turned out he was everything I thought he was and plus some. Ann and I had said way back that if we accumulate money, Ann is a teacher so we want to give 50 percent to education, and I want to give 50 percent to wildlife causes. Then this opportunity at Iowa State came up, so our giving has now moved toward education and health instead of wildlife. And Ben Allen is a big reason why. We started in Shenandoah and lived there for almost 10 years, and now here in Iowa City for over 30 years. We feel that what we’ve been able to accumulate has been because of all the efforts of the good people of Iowa. And Iowa State is such an Iowa university, with so many small town Iowa kids. The idea of education, and the kids from Iowa, made us feel that this was the best place to give back what we had gained. Is it a little bit surreal to see your name on a building like that? Or to drive down University Boulevard in Ames and see your and Ann’s faces up on a banner?

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No one has ever asked me that, and I don’t think about it. I very often ask, “How did I get in this position?” because the word surreal really is true in that case. But as far as seeing our names on the building, I don’t even think about that. You and Ann were initially reluctant to put your names on the building. This plaque, which is displayed in the Gerdin Businesss Building, also hangs in Russ Gerdin’s office.

Yes. Why was that? Ann and I are the shepherds of this money. But we didn’t make this money – all these people did [gestures toward other employees]. So why do Russ and Ann get all the credit? Because your name is on something, it looks like that means you did all the work, and that is the furthest thing from the truth. So we struggled with that. That was also your first major gift. Yes. How has that shaped your and Ann’s thinking on philanthropy? Did it serve as a platform for you to get into some of your other philanthropic gifts? Yes, absolutely. That was the stepping stone and learning experience. I think that because of the students and how grateful they are, we got a real good feeling because we had not done it before. And it wasn’t just the students—we have had numerous parents call and say thank you for

We have had numerous parents call and say thank you for the facility. And the staff has been out of this world. We got in a real good comfort zone.

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the facility. And the staff has been out of this world. We got in a real good comfort zone. We did it for the Iowa people, and the Iowa people responded. And the big thing is knowing that long after we are gone, the building will still be serving a purpose for many, many years. That’s very pleasing to know that they appreciate it. It really is. I was at a philanthropy luncheon recently. I got up to speak, and said, “You don’t have any money, and I don’t have any money.” I got some really blank stares. I said, “When it comes down to money, no one really has any. All we are doing is using it. We come in here with nothing and leave with nothing. The money that I’m given is not mine. If we have been fortunate, it’s because someone bigger than me has made that decision. I’m just the caretaker.” They asked us how we decided where we are going to give, and I said, “I don’t know. When it feels right, I give.” At the Dean’s Advisory Council meeting last spring, you decided on the spot to give another $1.1 million to the College of Business—$1 million for the PhD program and $100,000 for the Gerdin Citizenship Program. What sparked you to make that decision? I don’t know ... and I do that in all phases, not just in that meeting. Sometimes I just make a decision right there, spur of the moment. I’m not sure what that is, and I can’t explain it. I don’t know what happens to me, I just get the

done such a good job to follow him up. As I sat in that meeting, I thought about the building and how Labh and his staff have done such a great job, and the students have been so appreciative, that why shouldn’t I back this PhD program that the college needs? It was just kind of a common sense thing. Certainly, your instinct has served you well up to this point. So far we have been right and it has worked in the things we have given to. I haven’t got an investment someplace that I haven’t been proud of.

Russ and Ann Gerdin at the 2004 dedication of the Gerdin Business Building.

feeling, “Yep, right now is the time to do it.” If I think about it for a long time, it probably won’t happen. I have to really feel it, and then I do it. I don’t have an answer to it. But it has to come from an underlying trust in the cause or person you put your money into. It’s like buying the trucks. We may buy a thousand, two thousand, or three thousand of them at a time. The dealer is sitting here, and I know what I think is a good deal. And if they can meet that, we do it! But every once in awhile, the people at Heartland Express will say, “You didn’t say anything or tell us you were going to do that.” And I say, “Well I didn’t know I was going to do it until five minutes ago!” I didn’t go into that meeting thinking about making that donation. It wasn’t on my mind. But when it feels right, I’m pretty impulsive. When I was driving home that day I asked myself, “What the hell did you just do [laughs]?” Probably the biggest thing is that I trusted Ben Allen and my instincts about him were right. And now we are lucky because Labh [Hira, current College of Business dean] has

What is your perspective on the growth and progress you have seen in the College of Business? I think that the thing that impresses me the most is the students and how much they really care. The whole culture has always been very good and that just impresses me. Then I look at the differences between [former university president] Martin Jischke and President Geoffroy, and it seems like they are two totally different people, but they are both getting great results in different ways. And the College of Business is no doubt stronger than it was when I met both of them. So that tells me that the core of Iowa State has to be real solid. It impresses me how strong each of the colleges are. They are separate but in total they add up to a very solid institution. It is guided in a very solid fashion and the consistency and strength is what impresses me. Talk about some of your other philanthropic causes. Well, we built this new cancer Hope Lodge this year and they just opened it. We gave $4 million to that and we are giving $2 million to Minnesota State University Moorhead for their new wellness center. We gave $1 million to Katrina and lots of other smaller donations to different organi-

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zations. You can’t support everyone and everything; my philosophy is you have to do enough to make a difference rather than just being part of a donation. When you have a big one, you know you had a meaningful place in that whole project. I feel this Hope Lodge gift is a very important one because I have cancer and I know what those people are going through. I know all the operations I have had. And so when I go to the hospital now I can’t get in that cancer unit without the nurses coming and sayings thanks for those people who are coming and living at the Hope Lodge. It is really a satisfaction realizing those people who drive here from Fort Dodge and live in a hotel. You know you are helping a lot of people. You founded Heartland Express and built it from the ground up. It has been nearly three years now since you relinquished your duties as president, correct? Yes, that is correct. In part because of your cancer? One hundred percent because of my cancer. What has it been like in your role to see your son Michael take over as president? Mike was 38 and my plan was to make him president when he was 40. So it probably worked out well this way, since we have a great fatherson relationship and I have been around as he

I think that the thing that impresses me the most is the students and how much they really care. The whole culture has always been very good and that just impresses me.

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has taken over the reins. It is just really special. I think mainly because it is your son, you have so much pride and you really enjoy it. We are moving forward just like we always were so I get a lot of great feelings. He has been here since he was five years old. He has been through the big decisions and has the knowledge. Obviously, you are still very heavily involved in the company, but how would you describe your role now? I am exactly what they don’t teach in college. I believe I am way too involved compared to what they say a CEO is supposed to be. I get right in the middle of lots of things. Have your health issues changed your perspective on your personal time? Ann asked me once what I would do if they told me I only had 60 days left. I said, “I hope I’m at the office those last 59 days and that last day I’m gone.” I get more out of being here and the challenge of the job than I would ever get from playing golf or hunting, as much as I love to do that. If you had the chance, what would the Russ Gerdin of 2008, go back and tell the Russ Gerdin of 40 years ago? This sounds awful, and it’s not bragging, but I don’t think that there has been a day where I could believe we are where we are. I’m always amazed at where we are compared to where we started and my original goal. When I started, I said, “If I can get 50 trucks, that would really be something.” And now it is over 3,000. It is just doing the right thing as often as you can each day, and it keeps building. It proves in our world that if you service your customer, you will grow. And that’s what happened here. ■

Growing Diversity COLLEGE HOSTS UNIQUE BUSINESS PLAN COMPETITION

Successful organizations have long understood that fostering diversity within their ranks is a critical component to their success. It is a matter not only of recruiting minority employees—as important as that is—but also learning to recognize individual differences and leverage the strengths of each distinct person.

Diversity is especially important in today’s ever-shrinking world, where your subordinates may span multiple countries, or your best customer might be ten time zones away. As a major university in a largely white state, diversity takes on even more importance for Iowa State. And the College of Business has been active in seeking new ways to raise awareness of the importance of diversity. The college has an active Diversity Advisory Committee among its faculty and staff and the Multicultural Business Network offers networking and resources for minority business students. In fall 2008, the College of Business presented its students with an innovative educational opportunity, called ichooseDiversity. The premise was simple: form teams of three students apiece, and submit a proposal for an initiative that will foster diversity in the College of Business, at Iowa State University, or in the Ames community. Each team was asked to consider its overall goal, the budget to fund its proposal, marketing tactics, time and resources required for implementation, sustainability, and how to assess the outcome.

Sharon Slaikeu, Curtis Nielsen, and Olivia Lattin make their winning presentation at the ichooseDiversity competition in November 2008.

The competition was the brainchild of College of Business alumnus Ha-Keem Abdel-Khaliq (’96 Management, ’98 MBA), who works as a sourcing specialist in Cargill’s recruiting department. The idea, he says, was borne out of Cargill’s own diversity initiatives but is directed specifically toward college students. “My hope with this idea was that it would not just generate ideas among college students on how

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to improve diversity in their communities,” Abdel-Khaliq said, “but also that it would give Cargill a chance to connect with campuses.” Abdel-Khaliq brought Cargill on as a sponsor, and Cargill funded $1,000 stipends for all three members of the winning team. The College of Business Diversity Advisory Committee coordinated the competition. But the competition didn’t end there: Cargill also agreed to fund up to $2,500 for the winning team to implement its proposal in the community. So in addition to the satisfaction of knowing they wrote a winning business plan, students on the winning team would also gain the valuable experience of executing it. In all, ten student teams submitted written proposals, which were evaluated by a team of judges from Cargill, Iowa State, and the City of Ames. Four finalists were selected from all entrants and asked to prepare 30-minute oral presentations outlining their proposals and taking questions

from the panel of judges at the final competition on November 10, 2008. The proposals ranged from the focused and very tactical to large, inclusive events. One finalist group wanted to create a council that sponsors initiatives to increase, retain, and promote minority student In addition to the satisfaction populations. Another wanted of knowing they wrote to create an education program a winning business plan, for students to teach them students on the winning how to handle diversity in team would also execute it. different settings. Perhaps the most distinct proposal came from a group that wanted to target Iowa high schools with high minority concentrations, then reaching out to those prospective students using Iowa State students of similar backgrounds. The winning proposal came from Olivia Lattin, (graduated December 2008, management), Curtis Nielsen (senior, management and marketing), and Sharon Slaikeu (graduated December 2008,

ichooseDiversity Finalists The four finalist groups and their proposals. Winner Olivia Lattin graduated December 2008, management Curtis Nielsen senior, management and marketing Sharon Slaikeu graduated December 2008, management

D’Juan Cobbs senior, accounting Thomas Harmsen junior, marketing Zhiyi “Jack” Xu senior, management

Hold a festival in Ames showcasing the unique cultural backgrounds of those in the community. The festival would include representatives from all Ames organizations, including Ames High, ISU and local vendors.

Develop a Multicultural Business Advisory Council for Young Business Professionals to plan and fund events, projects, and organizations that will increase the retention and advancement of multicultural students.

Peter Arentson senior, marketing Jessica Huckstadt senior, marketing Stephanie Wawers senior, management

Fabrice Ouedraogo sophomore, finance Timothy Miew Shen Su junior, finance Ismael Kouotou NJoya senior, finance and economics

Create a Diversity Connection Program to improve diversity education among students and teach them how to manage diversity in social and business settings.

Create a relationship between Iowa State diversity associations and the most diverse counties in Iowa. The program could be used for local diversity recruiting and improve community involvement between Iowa State and those areas.

Award for Best Presenter: Timothy Miew Shen Su

Award for Best in Question and Answer: D’Juan Cobbs

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management). They proposed the Cyclone Cultural Festival, a daylong event which would showcase the unique cultural backgrounds of those in the — Ha-Keem Abdel-Khaliq community. The festival would feature ethnic restaurants and vendors, diversity-related clubs and organizations, and speakers about numerous cultural topics. The group targeted September 2009 as the date for the festival. They modeled their proposal after the U.S. Cellular World Food Festival, an annual event in the East Village area of Des Moines in conjunction with the World Food Prize awards. That event features local vendors who serve international cuisine. The event was free and also featured entertainment. To pull off a large festival on a $2,500 budget would require meticulous planning, and plan they did. Every last detail—up to and including equipment rentals, security, and cleanup costs—was covered. The group even contacted the Iowa State police and risk management departments for their assessments and prepared a formal event notification form. They also planned to supplement their $2,500 budget by pursuing sponsorships and hosting raffles and other fundraisers. Lattin said that early community interest in participating in their winning event has been encouraging. “We have several community interest and diversity groups coming forward and showing enthusiasm for the festival,” she said. “Which we really appreciate in light of the scale the whole event is taking on.” Mark Peterson, the college’s director of graduate career services and a member of its Diversity Advisory Committee, was enthusiastic about the outcome of this first-of-its-kind competition. “It was really interesting to see such widely diverse interpretations of the theme and ideas generated, and that is just what we wanted,” he said. “The judges had a very interesting and challenging task to decide which proposal would have the most impact on the ISU and Ames communities and be most realistic to implement.”

“All of the ideas were top-notch. The results were so positive and in many ways exceeded original expectations.”

Ha-Keem Adbel-Khaliq of Cargill presents Timothy Miew Shen Su with the best presenter award following the ichooseDiversity competition.

Abdel-Khaliq agreed. “All of the ideas were top-notch. The results were so positive and in many ways exceeded original expectations.” Peterson says he is excited about what the future might hold for this competition. “There is solid potential for this competition to continue and to grow “I think the competition is a remarkably,” great way for students to he said. “As a show that they are willing first-time event, to go above and beyond.” we were pleas— Olivia Lattin antly surprised with the total number of student proposal submissions, as well as with how much effort the finalists clearly put into their presentations. The caliber of work done for this was superb. “And as a result, there has been strong interest from across the university, both on the part of students and departments, about the future of this event.” This year’s student participants felt that ichooseDiversity provided a valuable experience. “I think the competition is a great way for students to show that they are willing to go above and beyond for something they believe in,” said Lattin. Nielsen agreed, and pointed to another, unexpected benefit of the competition. “It is even helping me in my job search,” he said. “I feel it would greatly benefit everyone who is involved.” ■

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B R I EFS

Board of Regents Approves Tuition Plan In December 2008, the Board of Regents, State of Iowa, approved a proposal for the College of Business to implement differential tuition for junior and senior business majors. Differential tuition means that a college charges a rate of tuition above that which the university charges. It is also sometimes referred to as ‘supplemental’ tuition. This additional tuition will be phased in beginning in summer 2009. When differential tuition is fully implemented in the 2011-2012 academic year, junior and senior business majors will pay an additional $750 per semester, a rate that will increase each year at the same percentage amount as the base university tuition. As it is phased in, those students will pay $250 per semester in 2009-2010, and $500 per semester in 2010-2011. Those rates will be prorated for part-time students. Differential tuition is fairly common among business programs. Many business schools in the Big 12 already have it in place, as does the Tippie College of Business at the University of Iowa. The University of Northern Iowa College of Business Administration is implementing a proposal identical to that of the Iowa State College of Business. Differential tuition is necessary because the College of Business has the largest average class size of any college at Iowa State and teaches the most student credit hours per full-time equivalent faculty; both measures are nearly double the university average. Additionally, the college’s student-faculty ratio is higher than any undergraduate business schools in Iowa State’s Peer 11 universities, which is made up of Iowa State and other similar universities nationwide, such as Illinois, Minnesota, and Wisconsin. These factors have combined to hurt the college’s student satisfaction rating, as reported

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by Business Week magazine. Key factors in student satisfaction ratings are class sizes and access to faculty. Differential tuition will give the College of Business additional revenue to hire more faculty and reduce class sizes, which will improve students’ ability to master their course subject matter and develop the necessary communication and analytical skills to maximize their professional abilities. Based on 2007-2008 enrollment, differential tuition would generate an additional $2.5 million in revenue per year when fully implemented in 2011-2012. Of that revenue, $1.8 million would fund 11 new faculty positions. The college intends to reduce class sizes in 300-level core courses from their current average size of 200 to 300 students down to 60 to 70 students. Additionally, the college would be able to offer more course sections and new courses, meaning fewer students would be turned away from 300- and 400-level courses. Funding from differential tuition would also go toward the college’s Communication Center and Gerdin Citizenship Program, both of which were profiled in the fall 2008 Prospectus. Both programs are relatively new but have been highly popular with students and prospective employers. Finally, 15 percent of differential tuition revenues will go directly toward College of Business student scholarships. The college actively sought student input on its differential tuition proposal. Although students are always sensitive to tuition or fee increases, they were receptive to the uses of the additional funds. Business Council, the college’s lead student organization, voted 33-2 in support of the proposal. For more details on differential tuition, visit www.business.iastate.edu/undergraduate/tuition. ■

Differential tuition will give the College of Business additional revenue to hire more faculty and reduce class sizes.

B R I EFS

Entrepreneurship Program Earns Two Major Awards Iowa State University was honored with the Top Model Undergraduate Entrepreneurship Program “This award affirms that the approach we’ve taken to entrepreneurship education works.” — KAY PALAN

Award at the United States Association for Small Business and Entrepreneurship (USASBE) Annual Conference in Anaheim, California, in January. Howard Van Auken, the Bob and Kay Smith Fellow in Entrepreneurship and professor of management, was also named a Justin G. Longenecker Fellow at the conference. The award is the highest recognition that the organization gives to individuals who have made an outstanding contribution to the development, furtherance and benefit of small and medium businesses. Only 50 other individuals, including the late Max S. Wortman, distinguished professor of management in the College of Business, share this honor. Iowa State, Wichita State University and the University of Houston were chosen from among 37 entries for the award to make final presentations at the conference. Judi Eyles, associate director of the ISU Pappajohn Center for Entrepreneurship, and Kay Palan, associate dean for undergraduate programs in the College of Business, delivered Iowa State’s winning presentation. “Very few entrepreneurship programs have been recognized as a ‘national model’ program. So, we’re in an elite group,” Palan said. “It also affirms that the approach we’ve taken to entrepreneurship education works—it has significant impact on students and the university, it’s sustainable, and it’s a program that can be duplicated by other universities. We have very purposely set up an interdisciplinary program with strong academic and non-academic components that allows

KAY PALAN AND JUDI EYLES MADE THE WINNING PRESENTATION.

us to reach a large number of students—we think of it as a program with multiple gateways through which students can gain awareness about entrepreneurship. The key to our program is that we have administrators and faculty working together across campus with the Pappajohn staff to keep making our program better.” Eyles says the winning presentation focused on how Iowa State offers comprehensive entrepreneurship opportunities for its undergraduate students through its academic offerings—including a campuswide entrepreneurship initiative— experiential learning opportunities and mentoring for those who wish to start an entrepreneurial venture. “We have worked very hard for a very long time to establish a true interdisciplinary entrepreneurship program at Iowa State,” Eyles said. “It’s a great feeling to be recognized by our peers as having developed a model entrepreneurship program that others can learn from and hopefully replicate on their own campuses.”

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Van Auken’s USASBE honor recognizes his achievements in small business and entrepreneurship through his teaching, writing, research, training and public service. Since 1986, 51 distinguished educators, researchers, government officials, small business advocates and trade association leaders have been selected as USASBE Fellows. “We’re also proud of Howard’s induction into the USASBE Fellows group,” Eyles said. “Howard has been extremely active in USASBE for a long time, most recently serving as the organization’s president.” In addition to the two Iowa State awards, successful Des Moines entrepreneur John Pappajohn—the founder of the network of Pappajohn entrepreneurial centers at Iowa State, the University of Iowa, the University of Northern Iowa, Drake University and North Iowa Area Community College respectively—was the recipient of USASBE’s John E. Hughes Award for Entrepreneurial Advocacy. The award is presented

to an individual or organization that has consistently contributed encouragement, support, time, talent, development, and/or financial contribution to further the cause of entrepreneurship. “It was awesome to be able to introduce so many other schools to John and Mary Pappajohn at this event and to have the opportunity to recognize the Pappajohns for their wonderful gifts and support for entrepreneurship in Iowa in front of a national audience,” Eyles said. The ISU Pappajohn Center for Entrepreneurship—which provides academic support for the university’s interdisciplinary entrepreneurship minor—connects faculty, researchers, and students to the entrepreneurial world, while also providing Iowa’s business and entrepreneurial community access to resources and information within the university. It provides assistance to entrepreneurs—both students and those from off-campus—in their efforts to launch new ventures. Visit www.isupjcenter.org to learn more. ■

G E T I N V O LV E D I N B U S I N E S S W E E K 2 0 0 9 The 2009 edition of Business Week 2009

and companies to get involved in the

interact with students; a pizza lunch;

is slated for September 16 through 22,

event. Co-chair Ciara Hand anticipates

a golf tournament; and other activities

and College of Business alumni and

the balance of this year’s Business

such as ice skating, Frisbee golf, and

friends are invited to take part.

Week leaning toward business activities

softball. The week is also packed with

over fun, citing concern about the

career and professional development

Business students with an opportunity

economy and job market. Hand says

speakers and opportunities for students.

to network with business professionals,

that of particular interest to organizers

encourages learning beyond the class-

this year are speakers who can provide

undergraduate/businessweek for the

room and textbooks, and provides a

perspective on the changing business

full schedule of events and sponsorship

chance for faculty and students to get to

world and address economic concerns.

information, or contact Ann Coppernoll,

know each other on an informal basis.

Events slated for Business Week

director of undergraduate programs, at

Organizers aim for a balance of profes-

include: an all-college barbeque lunch;

sional development and fun activities.

an etiquette dinner where students

Business Week provides College of

The Business Week planning

can learn the finer points of dining; a

committee seeks speakers, sponsors,

networking dinner for companies to

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Visit www.business.iastate.edu/

ajcopper@iastate.edu.

B R I EFS

Business Seniors Make Semifinals of Ethics Competition Nathan Zahrt and Pete Arentson, seniors in the College of Business, qualified for the semifinals of the 2008 Eller

University, the University of Minnesota, and Georgetown University to make the semifinals. Zahrt graduated from the College of Business in December 2008 with degrees in finance and marketing. He is currently pursuing his MBA/JD in sports business at Marquette University in Milwaukee, Wisconsin. Arentson is a senior in marketing. Marjory Christensen, a senior in marketing, provided research assistance and preparation for Zahrt and Arentson’s presentation. The College of Business sent a team to the competition for the second time in 2008, and for the second time the team qualified for the semifinals. A team from Concordia University in Quebec was the competition winner. ■

Ethics Case Competition, a prestigious national contest held October 23-25 at the University of Arizona. The competition fielded 22 teams from many of the top-ranked undergraduate business schools in North America. It is designed to “expose students to a thought-provoking business ethics case that they could face in their professional careers.” Participating teams are asked to analyze an ethics case, present their recommendations, and respond to questions from a panel of judges. The 2008 case asked teams to advise the governor of Arizona whether she should support re-opening a dormant copper mine, taking into consideration the impact on the environment and community. Zahrt and Arentson bested teams from Penn State

M O S M A N E A R N S P R E S T I G I O U S WA L L A C E E . B A R O N AWA R D Shellie Mosman, a senior accounting

State University Ring courtesy of the

sively in nursing homes and elementary

selected as a recipient of the ISU

Alumni Association.

schools in Iowa, and is the volunteer

Alumni Association’s Wallace E. Baron All-University Senior Award. The award recognizes outstanding seniors who display high character, out-

Mosman has also volunteered exten-

major from Carroll, Iowa, has been

Mosman has a

director of VERB for kids, a program to

perfect 4.0 grade-

encourage youth to stay active. She has

point average and

also personally raised more than $5,000

plays on the Iowa

for the Multiple Sclerosis Walk, and she

standing achievement in academics and

State women’s basketball team. She is

raises funds each year and volunteers

university or community activities, and

a recipient of the Cyclone High Scholar

her time to create Thanksgiving baskets

promise for continuing these exemplary

Athlete Award. She is currently the co-

for the needy.

qualities as alumni. Only five seniors were

vice president of the Student Athlete

selected to receive the award in 2009.

Advisory Council, a member of the

named to the Big 12 Good Works Team,

For her dedication, Mosman was

Awardees receive recognition at

Athletics Advisory Council, and is a

a group of the Big 12 Conference’s most

two ceremonies on campus and also

volunteer for alumni activities in the

service-oriented student-athletes, in

receive a complimentary Official Iowa

athletics department.

winter 2008.

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summer of 2008, Arora was a summer associate at McDermott Will & Emery LLP, one of the top 50 most prestigious firms in the nation. Arora worked in the Chicago office, and after graduating this May will return as a first-year

1970s

1990s

Al Brown (‘73 Industrial Administration)

Eric Bartel (‘93 Transportation and

retired in October 2007, after 35 years

Logistics) married Lisa Niedermann

with the United States Postal Service.

January 2, 2009, in Owatonna,

Jess Bucklin Bormann (‘05 Marketing)

His final position was in the executive

Minnesota. They reside in Toledo, Iowa.

has been working with JT Mega in

position of Manager, Distribution

A LUM NI NEWS

CLASS NOTES

Iowa Student Bar Association. The

associate in the firm’s commercial litigation practice group.

Minneapolis since 2006. She is an

Networks for the Greats Lakes Area,

Susan Sand Brown (‘97 Transportation

assistant account executive and works

headquartered in Chicago. After retir-

and Logistics) and husband Ryan

on marketing and advertising for

ing, he and his wife Cyndee moved to

moved to Gastonia, North Carolina,

Hormel Deli, Di Lusso Deli Company,

Seminole, Florida where they have a

in 2004. They have three daughters,

Hormel Party Trays, Fresh Pantry and

home on the intercoastal waterway

Katie, six; Abbi, three; and Sara, one.

various Hormel brands. She has been

where they enjoy sailing, biking and

married to Keith Bormann (’05

traveling. They have two adult children

2000s

who reside in the Chicago-land area

Materials Engineering) since 2005 and they have identical twin boys, Dylan

with their families. They also have two

Clinton Ackerberg (‘04 Finance) sat for

Tyler and Carter Benjamin, that were

grandchildren, Payton and Emma.

the Series 7, Series 66, and life/acci-

born on October 22, 2008.

dent and health exams. He started his career with American Express, for-

Matthew Bradner (‘08 Finance &

merly IDS and currently Ameriprise

Management), Founder and Manager

Betsy Draper (‘82 Management)

Financial. After a few years of learning

of Iowa Home Consulting, is a lifelong

joined the Cooperative State Research,

about the industry he left and started

member of the Ames community. Iowa

Education, and Extension Service with

his own business as an independent

Home Consulting works with real

the U.S. Department of Agriculture as

wealth manager. He now has clients

estate agents and homeowners to

its enterprise architecture program

all over the country and sends out a

make homes more attractive for sale

and capital planning specialist in its

weekly wealth report to clients, poten-

to prospective buyers. ■

Information Systems and Technology

tial clients, friends and family.

1980s

Management (ISTM) Unit. She also holds an MBA from North Dakota

Kristin Cummings Russell

State University and an Ed.D. from the

(‘04 Accounting) is currently employed

University of South Dakota. She has

with Farmers Cooperative Company in

more than 25 years of information and

Ames as a Financial Analyst. She was

instructional technology, planning,

married in April 2007 and is expecting

and institutional research leadership

her first baby (boy) on June 30.

experience in higher education.

ATTEND ALUMNI DAYS 2009 May 14-16, 2009

This annual event honors individuals who graduated from Iowa State 50 or

Zoya Arora (‘05 Finance) traveled

more years ago.

John O’Donnell (‘88 Finance) joined

Spain the summer before starting law

Alumni Days includes the opportu-

Marquette Financial Companies, a

school at the University of Iowa in fall

nity to reconnect with old classmates,

privately held financial service company

2006. In her third and final year of law

take tours, and attend special events.

based in Minneapolis, Minnesota, as its

school, she has served as a research

Don’t miss the Alumni Days Gold

chief credit officer. O’Donnell will over-

assistant, vice president of the Asian

Medal Banquet, in celebration of

see the credit management team, and

American Law Students Association,

the special anniversary.

his duties will include credit approvals

student writer for the Iowa Law

across all of Marquette’s business lines.

Review, and chair of diversity for the

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Visit www.isualum.org for more information and registration.

FA C ULTY PER SPEC TI VE

Are Layoffs the Answer? Economic downturns, like the one we are experiencing now, are part of the normal economic cycle—although certainly it The rare manager would suggest that people are assets to be nurtured and developed.

could be argued that this downturn has been (and may continue to be) unusually harsh. But regardless of the severity of the downturn, the sad truth is that many hardworking and competent employees, regardless of their work performance, typically face the brunt of firms’ downsizing efforts. Although no one likes layoffs—not employers, not employees, not employees’ families, and not communities—layoffs have indeed become one of the answers, if not the primary answer, to the problems that beset us. But is it the best answer? The most visible aspect of the current period is the high unemployment situation. A recent Merrill Lynch analysis suggested that the actual unemployment rate was closer to 14 percent, a number which included those people who have given up looking for jobs as well as those forced to work part-time when they would rather work full-time. This statistic is significantly higher than the 7.6 percent reported by the U.S. Department of Labor and is the result of management actions to stem financial losses through massive reduction of employment in their organizations. Long-term data, however, suggest that these efforts are usually counterproductive. Like any management decision, layoff efforts have to be approached thoughtfully and strategically, an approach which is usually lacking in most workforce reductions. First of all, most firms seem to be caught unaware of impending slow-down in their markets. Secondly, when they do finally begin to pay attention to a declining economy, the focus

turns to reducing costs, especially labor costs. After all, one could argue, isn’t “good management” profitfocused, specifically by paying attention to the profit and loss statements? If so, it stands to reason that good management should automatically TOM CHACKO strive to cut costs. On the other hand, the rare manager would suggest that people are not mere cost numbers to be slashed. Rather, they are assets to be nurtured and developed. An asset-focused management is likely to think long and hard on protecting, preserving and even growing valued assets— especially human assets. In this instance, good management should approach economic downturns strategically in the use and need for human talent. This asset perspective always trumps the cost/profit perspective over the long-term. Unfortunately, very few firms emphasize the asset focus in their downsizing efforts, hence their efforts generate few long-term benefits. Protecting the bottom line through cutting employee costs is not a sustainable strategy and is no substitute for profits from growth. It makes the firm unprepared for recovery phase in the normal economic cycle. How then do we approach a reduction in our workforce? Before I give two cases, let me start with a few presumptions. • People are not merely head counts to be added and deleted, numbers on a ledger to be adjusted to meet bottom-line expectations. Rather, people reflect talents and knowledge and skills and abilities that allow an organization to grow and expand, even in difficult times.

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• People provide the creativity and the initiative and the commitment to move forward. In turbulent times, these become even more critical. • People bring the wherewithal to capitalize on opportunities when the inevitable recovery occurs. If you desire to gain competitive advantage when things get better, you need to be prepared now for the speed, flexibility, and effectiveness you will need later. As we all know, laying employees off is a routine practice for auto manufacturers—with a few exceptions. Toyota stands out in this regard. And it too is considering laying off its employees, a practice that it has yet to use in its long and proud history. Last fall, when the Big Three were reducing their workforce, Toyota quietly shut down manufacturing in their Princeton, Indiana, and San Antonio, Texas, plants. But unlike the Big Three, Toyota laid off none of its 4,500 workers in these factories. While Toyota was losing revenues because of the production cuts of the big-ticket

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pickups and SUVs, it was also willing to take further financial losses by keeping its workers on the payroll. Toyota’s workers spent their time taking classes on safety, workplace diversity and ethics, and training exercises to improve their assembly skill levels. Latondra Newton, a general manager with Toyota, was quoted in Workforce Management as saying, “This was the first chance we’ve really had to live our values ... we’re not just keeping people on the payroll because we’re nice. At the end of all this, our hope is that we’ll end up with a more skilled North American workforce.” This is the asset management model in action. Six months after this no-layoff decision, economic conditions have worsened and Toyota, facing huge losses, has yet to initiate the massive layoffs we’ve seen at Chrysler, Ford, GM, and Nissan. Instead, Toyota is eliminating bonuses for it executive and salaried employees, cutting executive pay, reducing the work week, reducing and eliminating bonuses and scheduled wage increase to hourly employees. Even with these reductions in payroll costs, Toyota is now offering for the first time buyouts to its workers. All of the 25,000 or so of its workers in North America are offered 10 weeks of pay, two weeks of additional pay for every year of service, plus $20,000 in cash. Also, the buyout program remains voluntary and Toyota has currently no target numbers in mind. In contrast, GM is giving its workers $20,000 in cash plus a $25,000 voucher toward the purchase of a car—a GM, of course, reported the Wall Street Journal in February. When the economy revives, and demand for cars increases, my bet is with Toyota to drive away with better revenues and profits than GM. Tom Chacko is the chair of the Departments of Management and Marketing. ■

DEVELO PM ENT

Charitable Annuities Provide Gifts with Peace of Mind Personal philanthropy is such a rewarding experience once you find the causes that are dear to your heart. Numerous gifting Charitable gift annuities are an increasingly popular way donors are supporting their favorite charities while receiving personal income.

vehicles exist which make it easy for you to provide financial support to your favorite charity, organization or institution. In the last Prospectus, I provided information about ways that you can organize your estate plans, which may include leaving a charitable bequest in support of Iowa State University and the College of Business. In the second of this four-part series, I am going to share an increasingly popular way donors are supporting their favorite charities while receiving personal income supporting their own or a loved one’s living expenses. The charitable gift annuity is an easy way to support a charity. The donor transfers cash or securities to the charity in exchange for the charity’s written promise to pay a specified dollar amount for life to the donor and another beneficiary if desired. This income amount varies based on the donor’s age or the age of the income beneficiary, if different from the donor. The donor also has the option to defer the annuity payments for a period of years. For example, a 50-year-old donor may wish to defer annuity payments until she is 60 years of age. A deferred start date increases the income amount paid to the donor and can be used as a source of income during retirement years. The minimum amount needed to establish a charitable gift annuity with the Iowa State University Foundation is $10,000. In addition to the income that one receives through a charitable gift annuity, the donor also receives charitable

income tax deductions, as well. Some of our donors find the charitable gift annuity to be useful in augmenting income for the care of an aging parent, particularly if the annuity is established on the parent’s life. Other donors utilize the income payments to support a grandchild’s college education, or to enhance their retirement savings. For information on charitable gift annuities or other life income arrangements, I recommend a brochure titled, “Making a Difference, Creative Ways to Leave Your Own Legacy.” This is available through the Iowa State University Foundation at no charge by calling 800 621-8515 or by returning the reply card on the inside back cover of this magazine. In 1998, Robert Stafford, longtime Ames native and successful businessman, established a charitable gift annuity for the College of Business funded through appreciated stock. Stafford supports the college because of his involvement and interest in the college from when he was chairman of Ames National Corporation. “We have been very pleased with the performance of this charitable gift annuity,” Stafford said. “The payout that it provides allows us to enjoy many things in retirement. And we know that one day this will make a lasting impression on the College of Business.” I hope that you will take advantage of this opportunity through the Iowa State University Foundation. It would be a wonderful way for you to support the college during Campaign Iowa State: With Pride and Purpose. ■ Jeremy Galvin is the senior director of development for the College of Business. He can be reached toll free at 866 419-6768 or by e-mail at jdgalvin@iastate.edu.

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DEVELO PM ENT

A Vital Link in the Chain Supply chain logistics is all about planning and executing against a plan. Mark Walker (’79 Industrial Administration) knows how difficult that process can be in the current market. “With today’s global supply chains, dozens of people touch your product. Someone needs to keep track of each one to make sure it gets to its destination on time,” he says. “It’s about effectively routing freight to optimize cost, inventory control and security around the product itself.” Mark’s entire career has revolved around supply chain management and movement of freight within the transportation industry. To make sure these concepts are carried on at Iowa State, he and his wife Terri recently committed $500,000 to establish the Walker Professorship in Logistics Operations and Supply Chain Management within the College of Business. “Mark and Terri have made a substantial investment in the College of Business,” says Raisbeck Endowed Dean Labh Hira. “As a graduate of our program, we are very proud of all that Mark has achieved in such a short period of time. Both Mark and Terri are excellent role models for our younger generation of donors to the college.” “For both Terri and me, it came down to giving back to the college,” Mark says, “and to the profession that gave us all the opportunities that we have today.” Mark graduated from Ames High School in 1975. After his Iowa State degree, he also received his MBA in finance from Minnesota’s University of St. Thomas. Today, he is senior vice president of transportation for C.H. Robinson Worldwide, Inc., based

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in Minneapolis. He attributes his years at Iowa State with providing the basis for his success. “It was the foundation for my career,” he says. “When I entered college, I knew I wanted to join a business, but not what field it would be in. I did complete the CPA exam and used my accounting background. Your early success is about what you’ve gained overall in college—your ability to learn and problem-solve.” At the time he graduated, the job market was tough. “I got lucky when Robinson afforded me the opportunity to move into the transportation field,” he says. “We had 250 employees when I started in 1980. Today we have 7,500.” Occasionally, Mark returns to Iowa State to participate in business seminars and as a speaker. One of Mark and Terri’s daughters, Cary, is a 2006 marketing graduate from the ISU College of Business. Daughter Sarah attends college in Minneapolis. “I’ve noticed that Iowa graduates tend to leave the state for other opportunities,” he says. “I was one of those people who didn’t have career choices there.” Although Mark does not have all the answers to this exodus, he believes contributing to education is critical. “We need to help bring solutions to the table and create new business opportunities. “Iowa State’s supply chain program is by far one of the best in the country and probably the world,” he says, “but the world doesn’t know it. We’d like to help give it a boost. We’d like to try to attract more faculty members who will help continue to make it grow,” Mark says. “Terri and I would like to create an example that others could follow.” ■ Reprinted from the ISU Foundation.

“Iowa State’s supply chain program is by far one of the best in the country and probably the world.” — MARK WALKER

DEVELO PM ENT

MBA Grad Makes Giving a Priority Steve SchraderBachar (’02 MBA) was one of the first students in Iowa State’s part-time MBA program in Des Moines. “Being able to financially support the university is a great way of saying thanks.” — STEVE SCHRADERBACHAR

“I was one of the guinea pigs,” he joked. But he is serious when he credits the experience for helping him approach his business differently in a tough economic environment. Ron Ackerman, director of graduate admissions, and Mark Peterson, director of graduate career services, convinced him that the Iowa State parttime MBA, with all of his classes in Des Moines, would be a manageable task, given that he was already building a successful career. They were right, said SchraderBachar, now a mortgage consultant with Wells Fargo Home Mortgage in Ankeny, Iowa. And it has beneﬁted his career since. With that in mind, SchraderBachar recently made a $5,000 unrestricted gift to the College of Business, making an initial $5,000 gift to Cyclone athletics and using Wells Fargo’s corporate matching gift to fund his gift to the college. “It was a challenging program,” he said of his MBA experience. “It allowed me to think about opportunities outside the box, and new ideas. It made me realize how marketing can be effective for a business owner.”

SchraderBachar has been in the mortgage industry for years, an industry particularly affected by today’s tough economic climate, and he moved to Wells Fargo within the past year. “It’s challenging, but we’re still getting things done,” he says. “Marketing allows me to try to be different than some of my competitors.” SchraderBachar, who earned his bachelor’s degree from Illinois State University in Normal, Illinois, feels strongly about giving back to the institutions that impacted his career. “Think about the experiences that you had at Iowa State and the professors that were in your program,” he said. “I felt like I had a wonderful experience at Iowa State, and this is a way to repay people for helping me in my business. “It’s also about trying to help future generations have the same opportunities,” he said. For SchraderBachar, giving is not just an act, but a way of thinking. “If an alum had a great experience at the university,” he said, “being able to ﬁnancially support the university is a great way of saying thanks.” “I just look at it and say, ‘If something happened to you, how would you want someone to remember what you’ve done? What kind of life would you have lived?’” ■

CAMPAIGN IOWA STATE UPDATE Campaign Iowa State Goal Raised to date

$800 million $665 million

College of Business Campaign Goal Raised to date

$42 million $38 million

College of Business Production Goal for 2008-2009

$7 million

College of Business Fundraising Production for 2008-2009

$5.6 million

Campaign End Date: December 31, 2010 For more information, contact Jeremy Galvin, Senior Director of Development at (866) 419-6768 or jdgalvin@iastate.edu

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COLLEGE OF BUSINESS

Administration Labh S. Hira

Richard F. Poist

Soma Mitra

Dean

Chair, Department of Logistics, Operations, and Management Information Systems

Academic Fiscal Officer

Ronald J. Ackerman

Director, Small Business Development Centers

Michael R. Crum Associate Dean, Graduate Programs

Director, Graduate Admissions

Kay M. Palan

Steven T. Carter

Associate Dean, Undergraduate Programs

Director, Pappajohn Center for Entrepreneurship

Marvin L. Bouillon Chair, Department of Accounting Chair, Department of Finance

Ann J. Coppernoll

Thomas I. Chacko

Mary F. Evanson

Chair, Department of Management Chair, Department of Marketing

Director of Development

Director, Undergraduate Programs

Jeremy D. Galvin

James M. Heckmann Mark S. Peterson Director, Graduate Career Services

Jennifer D. Reitano Director, MBA Recruitment and Marketing

Daniel J. Ryan Director, Marketing and Alumni Relations

Kathryn K. Wieland Director, Business Career Services

Director of Development

Dean’s Advisory Council Craig A. Petermeier ’78, Chair

Beth E. Ford ‘86

Timothy J. O’Donovan ‘68

President, CEO Jacobson Companies

Executive Vice President, Head of Supply Chain International Flavors and Fragrances, Inc.

Chairman of the Board Wolverine World Wide Inc.

Ronald D. Banse ‘75

James F. Frein ‘67

David W. Raisbeck ‘71

Assistant General Auditor Union Pacific Corporation

President, Retired Hutchinson, Shockey, Erley & Co

Vice Chairman, Retired Cargill, Inc.

Kelley A. Bergstrom ‘65

Russell Gerdin

Ann Madden Rice

President Bergstrom Investment Management, LLC

Chairman and CEO Heartland Express, Inc.

Chief Executive Officer University of California, Davis Medical Center

Steve W. Bergstrom ‘79

Peter Gilman ‘86

Frank Ross ‘84

Chairman Arclight Energy Marketing

President and Chief Executive Officer AEGON Extraordinary Markets

Vice President—North America Operations Pioneer Hi-Bred International, Inc.

G. Steven Dapper ‘69

Isaiah Harris, Jr. ‘74

Steven T. Schuler ‘73

Founder and Chairman hawkeye | GROUP

Consultant Palm Coast, FL

Executive Vice President and Chief Financial Officer Federal Home Loan Bank of Des Moines

John D. DeVries ‘59

Cara K. Heiden ‘78

Walter W. Smith ‘69

CEO, Retired Colorfx

Division President, National Consumer and Institutional Lending Wells Fargo Home Mortgage

CEO ITWC Polyurethane

Daniel J. Houston ‘84

Vice President, Financial Shared Services General Mills, Inc.

Jerald K. Dittmer ‘80 President and Executive Vice President The HON Company and HNI Corporation

President, Retirement & Investor Services Principal Financial Group

David J. Drury ‘66

Richard N. Jurgens ‘71

Chairman and CEO, Retired The Principal Financial Group

Chairman, Chief Executive Officer, President Hy-Vee, Inc.

David K. Ecklund ‘72 Director, Global Supply Chain Management Executive MBA Program University of Tennessee, Knoxville

Daniel L. Krieger ‘59

Denise I. Essman ‘73

Cheryl G. Krongard ‘77

President and CEO Essman/Associates and Essman/Research

Partner, Retired Apollo Management LP

Mark Fisher ‘76

Robert E. McLaughlin ‘60

President and CEO United Community Bank

Senior Partner Steptoe and Johnson LLP

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Chairman Ames National Corporation

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John H. Stafford ‘76

Jane Sturgeon ‘85 Chief Executive Officer Barr-Nunn Transportation, Inc.

Jill A. Wagner ‘76 Regional Vice President Frontier Communications Solutions

DR . C HA R LES HA NDY

�� From the Desk of Founding Dean Charles Handy � � � � � � � � � � � � � � � � � � � ��

��

My story begins in 1940, at the start of my senior year in high school. My family had just completed its third move in

Coach Cael Sanderson took his wrestling squad to Cedar Rapids for a full day helping clean up debris left by the 2008 flood.

four years—moves necessitated by my father’s work. The situation was somewhat traumatic for a small town boy from Missouri. However, by move number three, to Independence, Iowa, I was beginning to adjust. Leo “Dewey” Donnelly was a new friend at Independence High School. It is a friendship that continues to this day. Through the years Dewey and his wife Therese have parented nine children. All have completed undergraduate work and some have earned master’s degrees. Their grandchildren have continued the family tradition. In the fall of 2003, Dewey told me that his granddaughter Molly, valedictorian of her high school class, was entering the College of Business. In addition, she would be interviewing for a position in the Union Pacific Undergraduate Programs Office. At the time I was not well acquainted with Molly, but knew the family was solid. I volunteered to call Dr. Ann Coppernoll, director of undergraduate programs, and put in a good word. A few days later, Leo called with the following statement: “Handy, you’ve got more pull than

IOWA STATE WRESTLING TEAM

Bush.” Yes, Ann hired Molly. �� (Dewey’s statement takes on

�� more significance when one �� realizes that ex-President W’s ��

approval ratings were much

�� higher in those days.) �� Molly justified my recom-

mendation and Ann’s hiring; she proved to be a very busy �� and successful undergraduate. While majoring �� in marketing, she also took on these student �� activities: three years of employment in the CB �� Undergraduate Office, one year of employment �� in the Frederiksen Court Office, participated in a �� Business Learning Community where she became �� a mentor, served on the Business Week Steering Committee the VEISHEA Central Committee, ��and �� worked as a student assistant for the wrestling �� team, and was selected to give the address at her �� college graduation in December 2007. �� Following graduation, Molly stayed on at Iowa �� State. She now serves as the first director of opera�� tions for Cyclone wrestling. This relationship led �� to �� an interesting set of events last fall. While lowkeying the activity, Coach Cael Sanderson took �� his�� wrestling squad on an unusual team retreat— �� a full day in Cedar Rapids helping clean up �� debris left by the 2008 flood. To get an early start, the�� team camped overnight on an acreage near �� Independence. As you might suspect, the acreage is �� owned by Molly’s parents, Tim and Cathy Donnelly. �� I will close with two sentences from Molly’s �� speech: “For me, Iowa State is the place where I became something of my own creation and something I am proud of. It is the place where I met some of the best people in the world and some of the people with whom I know I’ll be friends for the rest of my life.” �� My thoughts�� exactly. ■ � �� MOLLY DONNELLY ��

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��