Business Ethics Speaker Series – Roger Barnes

If you had to risk your career, your safety, and your reputation to do the right thing, would you? What if you would be giving up a significant amount of money in the process? Then would you?

These questions were the core of Roger Barnes’ speech, on Thursday, February 17, 2005. Barnes, a 'whistleblower' for Fannie Mae, was the second in a speaker series on Business Ethics, sponsored by the Smith School of Business. After a career spanning prominent firms such as Deloitte & Touche, Freddie Mac, and most recently, Fannie Mae, Barnes found himself in a moral and ethical predicament, which would forever alter the course of his life and career. While working with Fannie Mae, Barnes began noticing questionable accounting practices that drastically misstated the corporate finances. Of course, the practices were subtle and explainable by management at the beginning. Yet, over time, Barnes felt a sense of unease with the answers he received and the practices he observed repeatedly. Raised with small town values, and instinctively knowing right from wrong, Barnes gathered information over time to confirm his instincts beyond a shadow of a doubt, took care to ensure his competence could not be questioned, and ultimately took on one of the largest corporations in the United States. Since Barnes’ testimony before Congress, Fannie Mae has been investigated by the SEC, the FBI and the Department of Justice for misconduct resulting in a shareholder loss of over $20B, restatement of financial statements since 2001, increased capital requirements, and resignations of the CEO, CFO, Controller, and multiple Senior Vice Presidents.

Barnes’ key message to the audience was simple to understand, though sometimes difficult to execute: You must start by asking yourself what you will and will not do for money. He explored the ethical and moral questions behind this statement, by stating there is no one definition of ethics and that it is the choice of each individual to act in an ethical manner. Self assessment and integrity, he stated, were the cornerstones of knowing right from wrong. Barnes also mentioned that standing up for what one believes is right can often be a lonely responsibility. One needs courage to be the lone voice saying something differently in an organization used to working a certain way, and one must be willing to bear the consequences of that voice being heard. The impact of Sarbanes-Oxley, he stated, could not be underestimated in changing the American corporate landscape. If a person is aware of wrongdoing and does nothing to stop it, that person can be held liable for criminal and civil misconduct. Openness to investors was more than just a code of conduct, and students should be proactive in understanding the code of conduct at different companies prior to joining an organization.

Barnes had the following takeaways for his audience of faculty and students:

• Establish your own personal values early on in your life
• Be knowledgeable about business culture and technology
• Exercise personal “due diligence” – make sure the job you do is so top notch that no one can accuse you of incompetence or being disgruntled
• Remember the integrity of the first person you see every day (YOU)

When asked about ways in which a company can recover from such a setback as Fannie Mae, Barnes offered the following:

• New senior management for a clean slate start
• New external auditors (Fannie Mae fired KPMG, its external auditors through this process
• Development and rigorous execution of ethics programs and training throughout the company (not just posters on the wall)
• Changes to the Board of Directors

Barnes made a lasting impression on his audience with his message. He took a preacher with him to Congress, offering the audience that without hope there is only despair. His parting comments on what to if faced with such a dilemma was to be safe, keep one’s family safe, do your homework, but know that you have to do the right thing. One has to get through self doubt and recognize that individual integrity truly does make a difference.

Dr. Russell Ackoff Challenges The Conventional Business Education

On Wednesday, February 16, Smith welcomed Dr. Russell Ackoff, professor emeritus at the Wharton School of Business and an executive fellow at the Smith School.

In his discussion, Ackoff encouraged business schools to change their system of thinking. Ackoff believes that a transformation needs to take place in the teaching process in order to promote creativity. Students need more real life experiences in order to succeed in today’s business world, he said. “Nature and experience are not organized the way universities and colleges are into disciplines,” he said.

He challenged business schools, including the Smith School, “to think outside of the box.” He explained that you cannot make a difference and motivate talent if you’re stuck inside the box. His experiences have found that more students are hired for their experience than education.

“Dr. Ackoff’s experiences, innovative thinking and success as an educator for nearly 50 years serves as a case study of what works and what does not work in business education,” said Scott Koerwer, associate dean for executive education and marketing communications. “It was a great opportunity for all of us in the Smith community to ask ourselves ‘What is the future of business education?’ and ‘What is the role/responsibility of the Smith School?’”

Dr. Russell Ackoff is a professor emeritus at the Wharton School and executive fellow at the Smith School. Ackoff is chairman of INTERACT: The Institute for Interactive Management. Ackoff has written or co-authored 20 books and more than 200 articles for academic journals. He has a BS in architecture and PhD in the philosophy of science, both from the University of Pennsylvania.

▓ Nikia Andrews, Office of Marketing Communications

Governor Ehrlich Visits Smith Economics Class

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Dean Howard Frank takes Maryland Governor Robert L. Ehrlich, Jr., on a tour of Van Munching Hall, home of the Robert H. Smith School of Business.

Maryland Governor Robert L. Ehrlich, Jr., visited the Smith School on Monday, February 21. Smith School Dean Howard Frank, Arjang Assad, senior associate dean and professor of management science, and Lemma Senbet, chair of the finance department and holder of the William E. Mayer Chair in Finance, led the tour through the Smith School’s Netcentricity Labs for finance, supply chain management, e-markets, and behavioral science. The governor was accompanied by Chip DiPaula, the State of Maryland’s secretary of budget and management, as well as several other staff members. After the tour Ehrlich spoke to a class of first-year MBA students.

Both Governor Ehrlich and Dean Frank said they hope greater partnerships will develop between the Smith School’s thought leaders and the state government.

In one of Smith’s two Netcentric Financial Market Laboratories Russ Wermers, associate professor of finance, described the technical capabilities of the labs as an integral part of the Smith School agenda. “We train students to use the technology they will find in their workplaces, and introduce them to the stresses they will encounter in their careers.”

“I admire the way the real world is being brought into your education,” the governor remarked to a class of first-year MBA students. The governor’s remarks focused on the state’s new budget model, which he described as outcomes-driven, using quantitative measures of performance for state-provided services. When he entered the office, Governor Ehrlich pointed out, he had to cope with a multi-billion dollar structural deficit. This year, he says, the state will end its budgeting cycle with a $690 million surplus.
[Full Story & Video Highlights]

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Help Us Test the New Alumni Portal!

The eALUMNI Network at the Robert H. Smith School of Business is a custom-built networking and communications tool that utilizes the latest portal technologies. It was built for students and alumni alike to communicate and network online with Terps all over the world, as the official alumni portal of the Robert H. Smith School of Business community.

Some of the features of the eALUMNI Network at the Robert H. Smith School of Business include:

• Web-based alumni directory
• Profiles
• Resume and photo posting capability
• Virtual meeting rooms
• Threaded discussion boards
• Instant messaging
• Advertising and classified ads
• Dynamic calendar
• Online support and library help
• Virtual workplaces for sharing files
• Videoconferencing

We are currently in our beta testing period and all current students have been invited to test the eALUMNI Network at the Robert H. Smith School of Business. Enjoy the network and don't forget to send us your feedback -- once you are in there, just click on the "Feedback" tab to share your experience with us.

Access eALUMNI Network at: http://alumniportal.rhsmith.umd.edu

VCIC Competition in Review

The Venture Capital Investment Competition (VCIC®) is the nation's premiere strategy competition for venture-minded and entrepreneurial MBA students. This one-of-a-kind competition gives students from top business schools a real-world venture capitalist experience - student teams interact with real entrepreneurs from real companies with real business plans. Unlike other competitions where teams lock themselves away to mull over theoretical or historical scenarios, the VCIC® experience exposes students to a variety of activities that ultimately must be integrated into a cohesive investment strategy to be pitched to real venture capitalists. Many students hail the VCIC® as the most valuable learning experience of their MBA careers. 98% of past participants highly recommend the VCIC® to business school students interested in entrepreneurship and/or venture capital.

Congratulations to this year’s Smith winners!

• Bankole Osimokun
• Josiah Burnett
• Eric Andresen
• Matthew Welsh
• Carolina Puerto

Our five member team will go on to compete in the Regionals, which will be held March 10-12 in Atlanta, with the finals in Chapel Hill April 7-9. Only two teams from the Atlanta Regional will advance to the finals. Regionals competitors include Duke, Georgetown, London B.S., Maryland, Michigan, UNC, Virginia, and Wharton. Full bracket can be found below.

Winning teams from the Regionals receive $3000 for 1st Place, $2000 for 2nd Place, and $1000 for the Entrepreneur’s Choice Award. Winning teams from the Finals receive $10,000 for 1st Place. Good luck to the Smith team!

Smith Hosts SVP Marketing from National Geographic Channel

National Geographic Channel Exec Stresses Value of MBA to Current & Prospective Students

On Wednesday, February 23, 2005, the Graduate Marketing Association and the Smith Association of Women MBAs hosted Kiera Hynninen, senior vice president of marketing for the National Geographic Channel (NGC). Hynninen spoke to an enthusiastic and receptive group of 40 full-time, part-time and prospective students on a variety of topics, from career changing, cross marketing skills, working in different types of marketing, and the climate within the cable industry. Hynninen discussed the value of an MBA as the ability to think differently and solve problems proactively. She encouraged students to take risks through new opportunities, and ensure understanding of the role of marketing within a company prior to joining the organization.

Hynninen has over 15 years experience in the fields of marketing, branding and strategy, having promoted such recognized brands as Kraft Foods, Holiday Inn and The Weather Channel. At NGC, Hynninen manages all aspects of the Channel’s marketing team, including consumer marketing, partnership marketing, ad sales and new media. In January 2004, she was instrumental in launching NGC’s new Dare-to-Explore campaign and has seen the network experience record ratings and growth. Prior to joining the National Geographic Channel in June 2003, Hynninen served as vice president and senior vice president of strategic marketing at The Weather Channel. During her four-year tenure, she played a key role in launching the network’s first ever new stripped series, Storm Stories, which increased the network’s ratings 50 percent in time period. From 1997 to 1999, Hynninen served as director of marketing for Bass Hotels and Resorts, developing and implementing a new positioning campaign for Holiday Inn and Holiday Inn Express. Hynninen started her career at Kraft Foods, working up to Brand manager. While at Kraft, she created strategic corporate presentations for upper level management, and helped drive brand awareness and revitalization efforts for Kraft Foods products, such as Kraft Macaroni & Cheese, Athenos Feta and Minute Rice. Hynninen holds a Masters of Business Administration from the University of Chicago and a Bachelors of Science from the University of Richmond. She is also Treasurer for the Women in Cable & Telecommunications (WICT) Washington/Baltimore chapter.

Smith School in the News

Results from this year’s National Technology Readiness Survey, produced by the Smith School’s Center for Excellence in Service and Rockbridge Associates, Inc., continued to make headlines. Roland Rust, director of the Center for Excellence in Service, appeared in a televised interview with the Anchorage NBC affiliate, KTUU (2/21). Results from the survey were also featured in a tech round-up from Dow Jones (2/16) and television and radio broadcasts that aired across the U.S. including: The Daily Buzz (syndicated television program 2/7), KOVR-TV (Sacramento CBS affiliate), KTVU-TV (San Francisco FOX affiliate), KCBS-AM (San Francisco CBS affiliate 2/3), KOA-AM (Colorado 2/3), WTOP (Washington DC 2/3), WLFL-TV (Raleigh WB affiliate 2/3) and WVTV-TV (Milwaukee WB affiliate 2/3). Peter Morici, professor of international business, was quoted as an economic, trade and steel industry expert in articles that appeared in Investor’s Business Daily (2/18, 2/23), Associated Press (2/14, 2/16, 2/22), The San Diego Union Tribune (2/23) and other leading business news outlets.

For more Smith School media highlights and links to articles, visit Smith School in the News.

Women’s Leadership Conference on Friday, March 4
Sponsored by the Smith Association of Women MBAs and Bank of America

In celebration of Women’s History Month, the Smith Association of Women MBAs (formerly known as the Graduate Women in Business or GWIB) is excited to announce their marquee event – the Women’s Leadership Conference. The event, which will be held on March 4, will bring together full-time and part-time students at Smith, as well as alumni and industry professionals from the D.C. area. The keynote address will be given by Cynthia Flanders ’82, MBA ’88 senior vice president, commercial market executive, Bank of America, and a member of the Smith Alumni Chapter’s Board of Directors. There will also be three discussion panels led by distinguished women from organizations such as Marriott, UBS, Discovery, the Calvert Foundation, Accenture, and many more. A networking lunch will follow, and the afternoon will also include a class led by Joyce Russell, professor of management and organization, on “Salary Negotiation Tips and Strategies for Women.”

Tickets for this exciting event are $5 and will be on sale from February 21 to March 1 in Van Munching Hall's Grand Atrium. The Smith Association of Women MBAs strongly encourages their female classmates to take advantage of this unique opportunity to meet other fabulous women and hear their success stories.

BioTech Conference – Friday, March 11, RSVP by March 8

Please join the Robert H. Smith School of Business’ Graduate BIO|PhARMA Business Association and the Dingman Center for Entrepreneurship for a day of discussion

Venturing into Biotechnology: Strategies for Successful Growth in Maryland

Please help welcome:

Dr. Wei-Wu H
General Partner and Co-founder of Emerging Technology Partners

For a very special networking event on Friday, March 11, 2005 at 10 a.m. in
Room 1528 of Van Munching Hall

Two panel discussions will follow to discuss Maryland Resources and Venture Funding for Biotechnology Companies

Please RSVP by Tuesday, March 8th by clicking on http://ee.rhsmith.umd.edu/ApplicationFiles/web/WebFrame.cfm?web_id=744.

A reservation will be required to attend and seating is limited. A networking session with light refreshments will follow. Attire is business casual and there is no charge for this event. Please send an e-mail to Gabriela Tobal at gtobal@rhsmith.umd.edu with any questions.

Technology @ Smith

Wireless Computing in Van Munching Hall
Everything you need to know -- from purchasing a wireless access card to configuration -- can be found at: http://wireless.rhsmith.umd.edu. Guests visiting campus, who are sponsored by a faculty or staff member, can get wireless access through campus network operations. If you require access for a guest please send an e-mail to wireless@nts.umd.edu with the number of accounts required. In the e-mail please include the duration of access needed as well as contact information for verification. Be sure to request guest accounts at least four business days before you need them.

General Reminder About Classrooms & Labs
Our facilities have been equipped with state-of-the-art technology and security surveillance is present. In order to keep the attractive appearance and functionality of labs and classrooms, we appreciate your cooperation on the following:

• No food or drink is permitted in classrooms and labs. Please discard all food and drinks prior to entering these rooms. Staff members routinely check for food and drinks. Repeating offenses will be taken seriously and will result in the loss of access.
• Building Security is everyone’s responsibility. Please use your campus ID for access to secure areas and do not prop doors open. Report any suspicious behavior immediately to the Campus Police or to Faculty Services.]

New Smith School Screensavers & Wallpaper Available!
Smith School "Leaders for the Digital Economy" screensavers and desktop wallpaper images are now available for download at the Office of Marketing Communications Web site (along with PowerPoint presentation templates). Click on the link below and follow the instructions to install your new screensaver and wallpaper!

http://www.rhsmith.umd.edu/admin/comm/logos.html