Health Care Immersion

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Wall Street Week

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“Wall Street Week is the primary mechanism for introducing careers in financial services to first-year MBA students. When they meet alumni and other firm representatives, it brings a sense of reality to career paths they may have only read about. Students come back much better educated about their options and what it takes to get to Wall Street from Owen.”

—Emily Anderson

The Career Management Center’s Executive Director Read McNamara, MA’76, and Senior Associate Director Emily Anderson helped coordinate this weeklong trip to New York for 34 first-year MBA students exploring careers in finance. The group met with representatives of 11 different financial services firms: Bank of America Merrill Lynch, Barclays Capital, Citi Commercial Banking, Citi Investment Banking, Credit Suisse, Goldman Sachs, Guggenheim Partners, JPMorgan Chase, Paulson & Co., Petrus Partners and UBS. Representatives of the firms gave presentations about the economy and discussed MBA career paths within their organizations. Students gained additional insight into Wall Street from alumni who joined Dean Jim Bradford for the annual Wall Street Week Alumni Reception at the Union League Club.

“Wall Street Week was very important for my internship search,” says Neena Sinha, an MBA candidate for 2013. “Not only did I learn more about the banking industry, I gained a valuable network that will help support my career in the future.”

Brand Week

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Global Business Association Trip to Turkey

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Whether you tend to agree with rankings or not, they are an important driver of applications, our hiring ability, and frankly, alumni engagement. That said, they’re far from perfect.

Beyond the well-documented cases of schools in various disciplines gaming the system—or in some cases, simply providing false data—rankings will never be able to tell the full story of a school. As I’ve discovered, GMATs and GPAs tell you very little about the individuals who ultimately emerge as strong, ethical leaders.

As a business school dean, it’s easy to get wrapped up in the rankings race. While I fully intend to continue to compete vigorously, as we move forward you should know this: 1) The greater good of Owen will always come before rankings; and 2) No matter how high we climb, there will never be a quantitative measure that can capture leadership, determination and a commitment to purposes beyond ourselves—all qualities that, to me, mark Owen students and alumni.

In that spirit, allow me to highlight several pieces in this issue of Vanderbilt Business, starting with the cover story about Brent Turner, MBA’99. As you’ll see, Brent is often humorously self-effacing. But working alongside him, one soon discovers that he’s a masterful relationship builder, putting the right people and the smart strategies in place to get a job done. He’s also a doer who is unafraid to set lofty goals and then follow through on them with great dignity and determination. We’re lucky to have him as such an active alumnus and productive partner.

Elsewhere in the magazine, Alex Nicholson, EMBA’01, tells the story of how and why he decided to pursue a business degree in his 50s after years spent running his family’s business. And Linus Hall, EMBA’00, will make you thirsty for more after reading about his experience starting and growing Yazoo Brewing Co.

There’s also a report on innovative work happening at Owen, including the  groundbreaking new rule for measuring and capturing customer loyalty created by Professor Bruce Cooil and alumnus Tim Keiningham, MBA’89. In addition, you’ll read about an exciting new Silicon Valley endeavor that’s being started by two soon-to-be Owen grads, Mahni Ghorashi and Ilya Tokhner.

These stories help showcase the incredible vibrancy of the entire Owen community, from current students to our world-class faculty and administration to our invaluable alumni. For me, this is the soul of Owen—something no ranking could ever measure.

Sincerely yours,

James W. Bradford
Dean, Vanderbilt Owen Graduate School of Management
Ralph Owen Professor of Management

Of all the monuments to Renaissance ingenuity, one in particular has held my interest ever since I saw it in person years ago. The Basilica di Santa Maria del Fiore in Florence, Italy, otherwise known as the Duomo, is a towering achievement in architecture. Its octagonal dome, which is 140 feet wide and more than twice as high, remains the largest one ever built with bricks and mortar—no small feat considering it was completed nearly 600 years ago.

As awe-inspiring as the cathedral is to behold, the story behind its construction is just as remarkable. Legend has it that architect Filippo Brunelleschi received the commission to build the dome by winning a competition to see who could successfully stand an egg upright. While others tried to balance their eggs in vain, Brunelleschi smashed his on end. This act of bravado foreshadowed the daring design to come.

Whether the story’s apocryphal or not, there’s no doubt Brunelleschi was a man of rare talent. Yet often overlooked is the fact that he already had a foundation to build upon. Brunelleschi’s breakthrough was the culmination of a process that had begun more than a century earlier with architect Arnolfo di Cambio, who called for a dome of similar scope in his drawings. No one at that time knew how to construct such a dome, but that did not deter di Cambio or the builders who followed him. For decades they continued laying the groundwork, confident that someone would eventually finish what they had started.

That to me is the most inspirational part of the story. For all the originality of Brunelleschi’s dome, it could not have happened without the vision of those who came before him. As di Cambio showed, innovation is as much about planning as it is flashes of brilliance.

All these centuries later, the same is true at Owen, where innovative ideas, such as the ones highlighted here, are founded upon a farsighted commitment that stretches back to Vanderbilt’s beginnings. The education and research of today are made possible by the forethought, guidance and generosity of previous generations. As Chancellor James Kirkland once said, “In building a university there is never an occasion for finishing touches. The task is always one of laying foundations.”

Vanderbilt’s success lies in those very foundations Kirkland described. Much like the Duomo, the university can rise only as high as its base allows. The stronger the support, the more opportunities there’ll be to upend conventional thinking and push knowledge further and further—until someone comes along one day and spans the distances that once seemed impossible.

The Owen School improved to No. 25 in the nation, up from No. 28 last year, in the latest U.S. News & World Report rankings. It marks the school’s second-highest placement ever on the list.

“As our rankings continue to move up in a highly competitive field, it’s becoming clear that others are recognizing the business school’s remarkable momentum,” says Dean Jim Bradford. “We continue to work hard to attract top-caliber talent throughout all of our management programs and look forward to many more bright days ahead.”

Editor
Seth Robertson

Contributors
Lubaina Balasinorwala, Nelson Bryan (BA’73), Meg Hale, Abigail Humphrey, Jennifer Johnston, Alex Nicholson (EMBA’01), Shana Passman (MBA’09), Rob Simbeck, Cindy Thomsen, Ryan Underwood (BA’96), Amy Wolf

Photography
Kerry Dahlen, Daniel Dubois, Steve Green, Joe Howell, Lauren Owens, Anne Rayner, John Russell, Susan Urmy

Designer
Michael T. Smeltzer

Art Director
Donna Pritchett

Chief Marketing Officer
Yvonne Martin-Kidd

Associate Dean of Development and Alumni Relations
Cheryl Chunn

Editorial Offices: Vanderbilt University, Office of Development and Alumni Relations Communications, PMB 407703, 2301 Vanderbilt Place, Nashville, TN 37240-7703, Telephone: (615) 322-0817, Fax: (615) 343-8547, owenmagazine@vanderbilt.edu

Please direct alumni inquiries to: Office of Development and Alumni Relations, Owen Graduate School of Management, PMB 407754, 2301 Vanderbilt Place, Nashville, TN 37240-7754, Telephone: (615) 322-0815, alum@owen.vanderbilt.edu

Vanderbilt University is committed to principles of equal opportunity and affirmative action. Opinions expressed in Vanderbilt Business are those of the authors and do not necessarily reflect the views of the Owen School or Vanderbilt University.

Vanderbilt Business magazine is published twice a year by the Owen Graduate School of Management at Vanderbilt University, 401 21st Avenue South, Nashville, TN 37203-9932, in cooperation with the Vanderbilt Office of Development and Alumni Relations Communications.

© 2012 Vanderbilt University. “Vanderbilt” and the Vanderbilt logo are registered trademarks and service marks of Vanderbilt University.

Sohr Grant winners Mario Avila and Megan Allen

Microfinance lending and ecologically friendly false eyelashes may not seem to have much in common. But they’re both new business ideas that caught the attention of the prize committee awarding this year’s $25,000 Sohr Grants, created to promote student entrepreneurship at the Owen School.

Jim Sohr, BE’86, MBA’90, and his wife, Leah, endowed the new grants. Sohr is the past President and Co-founder of AIM Healthcare Services, which provides claims cost-management services for government and commercial payers of health care benefits. A division of UnitedHealth Group purchased AIM in 2009.

“We would love to create many companies that become as successful as AIM Healthcare,” says Germain Böer, Professor of Accounting and Director of the Owen Entrepreneurship Center. “With this kind of support, the Owen School can attract more students who already have a business idea that they want to develop. This funding, combined with the mentor support provided by the school’s alumni, will drive the success of these new ventures.”

Georgie Beauty

One of the grants went to Megan Allen, an MBA candidate for 2012, for her startup Georgie Beauty. Co-founded in 2009 by Allen and her sister, Abbey Allen Watt, the company makes “eco-luxe” false eyelashes sold under the brand name Winks by Georgie. The company has established partnerships with luxury retailers Neiman Marcus and Cos Bar. It also has been featured in Martha Stewart Weddings, InStyle.com, and numerous beauty and style blogs. About the target audience, Allen writes in her business plan, “These women are looking for the latest cosmetic products that help them achieve the celebrity look, but that’s not all. They are also increasingly concerned with consumer and environmental health.”

Contigo Financial

Contigo Financial is developing a microfinance model to provide payday loans to the 60 million consumers in the United States who don’t have access to traditional bank loans or credit card products. Currently these types of small loans are provided by pawnshops and payday lenders, where borrowing costs can exceed an APR of 400 percent. Co-founder Mario Avila, a 2012 MBA candidate and President of the Owen Student Government Association, is leading a startup team that has experience in consulting, banking and microfinance. He and his team are taking a novel approach by partnering with employers to help their employees meet short-term financial needs.

“Energy is a huge sector. In some ways it’s even bigger and more complex than the health care industry as far as job opportunities,” says the Houston-based Veruki, who hosted a wine-tasting mixer at his home for the students and local alumni. “Energy’s not just about finance or operations or engineering. It’s also about marketing and HR and many other areas. And all of those opportunities are spread around the globe.”

The first stop on the Energy Trek was Macquarie Group, an international financial services company where Vikas Dwivedi, MBA’00, Global Oil and Gas Economist, and Charles Fenner, MBA’01, Senior Vice President of Power and Gas Fundamentals, gave a presentation. The student group next visited Baker Hughes, a leading oil field services company, whose President and CEO is Martin Craighead, IEMBA’98. Then it was on to global financial services firm JPMorgan Chase, where Robert Traband, MBA’93, Managing Director of Credit Risk Management, spoke.

The following morning, the group toured the world’s largest publicly traded oil and gas company, Exxon Mobil, which included a visit to its 3-D visualization room used for training employees in drilling operations. The group then toured the trading floor of Chevron, another of the world’s leading oil and gas companies. The final stop was international financial services firm Credit Suisse, where Managing Director Tim Perry, MBA’81, gave a presentation.

Houston-native Gilliland, who previously worked for Macquarie before enrolling at Owen, anticipates that the Energy Club will continue to grow and broaden its appeal. She sees potential in networking with more utility and energy companies in the Southeast, as well as renewable energy businesses.

“Our goal is to bring more value to club members and expand our offerings, whether it’s new networking opportunities, guest speakers or internships,” she says. “That means we have to get the word out to alumni that there’s an interest in energy at the school. We want them to know that we’re building something here and that they can play a hand in it.”

To find out how you can help the Owen Energy Club, please email owenenergy@owen.vanderbilt.edu.

Cheryl Chunn

Cheryl Chunn joined Owen this past November as the school’s Associate Dean of Development and Alumni Relations. She has worked at Vanderbilt for 10 years, six of which have been in development. Her previous roles include Director of Development and Director of Corporate Relations for Vanderbilt University Medical Center, as well as Senior Associate Director of Corporate and Foundation Relations Development. Chunn has a bachelor’s from Valparaiso University, a master’s from the University of Wisconsin-Milwaukee and an MBA from Keller Graduate School of Management in Chicago.

Q: What drew you to this opportunity at Owen?

A: First, it’s Vanderbilt and my 10 years working in both the Medical Center and the university that drew me to Owen. It’s an incredible place to work. I’m amazed every day at all that’s going on here to help transform business, medicine, education and the community we live in.

Also what drew me was my previous work with Owen and Jim Bradford as a development officer with Corporate and Foundation Relations. I had the opportunity to visit with Owen alumni all over who were so passionate about their experiences here. The word they used was “family.” I heard that over and over again.

Q: How has your MBA shaped your approach to development and alumni relations?

A: My MBA has helped me understand that all philanthropists want to know their gifts are doing something meaningful. What I learned in my schooling was the question: “What’s the return on my investment?” I approach my development activity with that in mind. I want our alumni donors to know what Owen needs, why we need it and how they can help. Being able to steward them with the answer to that ROI question is my next step.

Also I know how hard I worked to get my degree and realize that I wouldn’t have the same perspective and experience without it. Likewise for our alumni, Owen has helped them not only in their professional lives but in their personal lives as well, and I believe they want to give back because of that fact.

Q: What are some of the short-and long-term goals for Owen’s development and alumni relations team?

A: One of the short-term goals is to learn how to work as a team. With many new team members, we’ll be forging ahead to build on the existing base of support from Owen to develop goals and structures that help our students, faculty and alumni.

Our more ambitious goals for the immediate future are to be able to accomplish the development and alumni relations goals of the strategic plan and to make Owen more successful. We will focus on increasing the number of endowed scholarships for students, strengthening alumni engagement and working with the dean on potential space and program needs.

Art Laffer speaking at Averbuch Auditorium

Arthur B. Laffer, a renowned economist and longtime champion of conservative causes, proposed a novel approach to taxation at a forum held in Owen’s Averbuch Auditorium Feb. 23. Laffer said he sees a fundamentally backward system in the United States, which imposes taxes on things people want more of—income and jobs—while allowing something we want less of—carbon dioxide pollution—to be emitted without penalty.

The situation should be reversed, Laffer argued. Instead of tax increases that are “veiled as ‘cap and trade’ schemes,” he said, Congress should offset a simple carbon tax with a reduction in income or payroll taxes.

Joining Laffer in the discussion was former U.S. Rep. Bob Inglis of South Carolina. “Art Laffer is a conservative who’s agnostic on climate change. I’m a conservative who believes it’s real,” Inglis said. “Both of us see opportunity in changing what we tax. For Art, it’s about his lifelong quest to reduce marginal tax rates. For me, it’s that—plus the opportunity to fix a market distortion that prevents the free enterprise system from delivering the fuels of the future.”

A member of President Reagan’s Economic Policy Advisory Board between 1981 and 1989, Laffer is the Founder and Chairman of Nashville-based Laffer Associates, an economic research firm that provides global investment research services to institutional asset managers, pension funds, financial institutions and corporations.

Owen Insights is a student-run series that encourages collaborative learning through regular presentations, discussions and workshops.

Owen has long been known for its strong sense of community, and that reputation stands to grow thanks to the efforts of the latest classes to pass through Management Hall. Students have started a first-of-its-kind forum at the school for sharing their areas of expertise with one another. Called Owen Insights, the series aims to foster a collaborative learning environment through regular presentations, discussions and workshops.

Founded by Aaron Fung, an MBA candidate for 2012, Owen Insights draws upon the wide variety of backgrounds, nationalities and professional experiences represented across the student body. “While the classroom has contributed a lot to my learning experience here at Owen, the majority of my learning has taken place outside the classroom through my interactions with classmates,” Fung says. “This is what inspired me to create a common platform for students to enhance their learning experience at Owen.”

Prior to business school, Fung worked as Director of Strategy for Ascend, a nonprofit association that focuses on professional networking and leadership opportunities for Asian Americans. His experiences at Ascend have helped him steer the Owen Insights venture. He views the series as an opportunity for students to not only network with each other but also hone critical presentation and public speaking skills.

Students are encouraged to suggest ideas for workshops, and topics in the past have included the business of education and American slang, which was of particular interest to international students. More recent topics have ranged from Foundations of American Politics, taught by Steven Smith, former presidential appointee, White House staffer and MBA candidate for 2013; to Tips and Tricks of Excel led by former financial analyst and 2012 MBA candidate Doug Midkiff; to European Economics led by Sergi Tejero Cano, former Chairman of the Andorran Economist Association and MBA candidate for 2012. Fung himself, who is a chartered retirement plan counselor, taught The Basics of Personal Finance along with Kate Yoho and Carlton Fitch, both CFP practitioners and MBA candidates for 2013.

Thus far the series has seen an enthusiastic response from students, and Fung hopes it will continue even after he graduates. “I’d like Owen Insights to become a self-sustaining program that draws all students into it,” Fung says. “I think people really want to learn from each other, and the great thing is that people are willing to teach. They just need a mechanism through which their knowledge can come out. Owen Insights gives students that mechanism and makes it easier for classmates to learn something that they might not get in a typical academic setting.”

Headlining the October event was Nancy-Ann DeParle, Deputy Chief of Staff to President Barack Obama. Drawing on her experience as Director of the White House Office of Health Reform, DeParle outlined the contrast in the national health care system prior to passage of the 2009 Patient Protection and Affordable Care Act and what it will look like once the plan is fully implemented.

Where We Were

• Health insurance premiums doubled: Family premiums for employer coverage rose from nearly $6,000 to more than $13,000 between 1999 and 2000.
• Insured Americans and businesses paid a hidden tax: Up to $1,000 of uncompensated care was shifted from the uninsured to already-insured families. In 2008 we spent $43 billion on uncompensated care.
• Millions lacked quality, affordable health care: 50 million Americans were uninsured in 2009, and millions more lacked access to quality care, preventive services and catastrophic protection when ill or injured.
• People with pre-existing conditions were locked out: As many as 129 million Americans have a pre-existing condition that could limit access to insurance.

A career fair held at the Nashville Convention Center was one of the highlights of the Vanderbilt Health Care Conference.

“Even after spending almost twice as much per capita on health care as every other industrialized country in the world, we continue to rank near the bottom when it comes to health care outcomes,” DeParle said. “Those of you working in health care understand that this is bad for business. Imagine you’re selling cars. If cars become more expensive, but the quality stays the same, or even gets worse, you don’t need an MBA … to realize that you’re in trouble.

“Health care isn’t like most other industries. If people can’t afford insurance, they don’t stop coming to the hospital. They just stop paying for the care they receive. So to tweak the analogy that I just used, not only are customers not buying cars, but you have to hand them out for free. That’s not sustainable.”

What the Law Does

• Allows young adults to stay on their parents’ policies: More than 1 million 18- to 26-year-olds have benefited.
• Gives uninsured with pre-existing conditions affordable insurance: The Pre-existing Condition Insurance Plan has covered more than 30,000 people and is a bridge to 2014 when discriminating against anyone with a pre-existing condition will be illegal.
• Protects retiree coverage: $5 billion is provided to keep coverage affordable for early retirees in more than 6,600 plans.
• Expands community health centers and workforce: Clinics can serve nearly 20 million more Americans, adding 16,000 primary-care providers during the next five years.
• Holds health insurers accountable: The law implements a patient’s bill of rights, eliminates double-digit rate hikes without review, guarantees that overhead expenses are held in check, and promotes pricing transparency among health plans on healthcare.gov.
• Creates a competitive and affordable insurance marketplace: Starting in 2014, consumers will be offered the same health plan choices as members of Congress. Tax credits and Medicare coverage will be made available to ensure that coverage is affordable for families and small businesses. The law also protects existing employer-based coverage while ensuring that all Americans who can afford it get health insurance, increasing the insurance purchasing pool, ending pre-existing condition exclusions, and eliminating the “hidden tax” of cost shifting.
• Lowers cost and improves quality: Health care fraud persecutions are up 85 percent, and billions have already been saved. The law promotes prevention and offers incentives to reduce hospital readmissions and conditions acquired in health care facilities. It also provides tax credits to small businesses and relief for seniors. There was record low growth in national health spending in 2009 and 2010.

“I’m not saying it’s going to be easy for us to make all of these changes,” DeParle said. “But what I’m saying is the framework is there and the incentives are there in this new law.

“Do we embrace this new law, this new world of health reform, as a first step and work together to make it better? Or do we fight to restore an unsustainable status quo that left millions of our neighbors on their own in their time of need?”

A version of this article originally appeared in VB Intelligence on Nov. 17, 2011.

“If you’re 20-something and have an idea of what you want to build, you can go out and build it,” Harj Taggar, a partner at the Silicon Valley incubator Y Combinator, told the Financial Times in a recent story, echoing the tech boom of the late 1990s.

But after a dizzying decade that ushered in everything from Google’s search engines to touch-screen tablets—and plenty of flops in between—how much more technology are consumers willing to adopt?

It’s a critical question that Mark Ratchford, Assistant Professor of Marketing at the Owen School, is helping companies explore with a new tool called the Technology Adoption Propensity (TAP) index.

“Effectively segmenting and targeting customers based on their likelihood to purchase and use new technologies could help firms better capitalize on their high-tech investments,” Ratchford writes in a recent paper for the Journal of Business Research that introduced the TAP index. The study was co-authored by Michelle Barnhart, Assistant Professor of Marketing at Oregon State University.

Mark Ratchford

Similar psychological measurements have been developed previously to gauge a consumer’s willingness to use new technologies. For example, the Technology Acceptance Model (TAM) was introduced in 1986 to explore user acceptance of—or resistance to—various technology-based systems, including email, word processors and the Internet.

Another stream of technology-related marketing research led to the creation in 2000 of the Technology Readiness Index (TRI), which focused primarily on a person’s likelihood of adopting service-based technologies, often related to e-commerce.

The problem with the TRI, according to Ratchford, is that its questions depend on specific technologies, making it increasingly obsolescent since this once narrow area has grown to cover everything from social media to smartphones.

“References to specific technologies grounds the TRI in a particular technological era and limits its usefulness as a measure of overall technological readiness,” Ratchford writes. “Hence, a new scale that measures consumers’ attitudes toward a varied and flexible concept of technology that seamlessly incorporates the specific technologies of each new era would be useful to researchers and marketers.”

The research team developed an initial 47-item psychological battery, based on 17 items included in the TRI and 30 new ones. To make the TAP index shorter without compromising its effectiveness, Ratchford and his co-author winnowed the items down to 14. Those were then aligned with traits that contribute to technology adoption (“optimism” and “proficiency”) or that inhibit adoption (“dependence” and “vulnerability”).

To validate the TAP index, the study asked more than 1,300 survey respondents to answer a series of yes-or-no questions designed to assess their current use of technology products and services. The results were then matched up against findings from the TAP index itself, showing that those who scored highly on the TAP index were the same ones already using technology. Conversely, those with low TAP scores were not likely to be heavy technology users.

“We show that the TAP index can predict consumers’ technology usage behaviors across a range of high-tech products and services,” Ratchford writes. “We expect that, as a more succinct and timeless measurement tool than prior scales designed for a similar purpose, the TAP index will prove to be a robust and useful scale for academics and practitioners alike.”

A version of this article originally appeared in VB Intelligence on Sept. 30, 2011.

The problem uncovered by the Vanderbilt team happens with put options—contracts that allow owners to sell an underlying asset at a specific price and within a certain time frame. (Put-option holders make money when the underlying asset price declines.)

Because American-style put options can be exercised anytime before they expire—as opposed to European-style options that can be acted upon only at expiration—investors must find the optimal point at which to close their positions. Otherwise they will forgo interest income that’s, in some cases, greater than their expected profit.

In the study, which will be published in a forthcoming Journal of Finance, Barraclough and Whaley develop a model to test when it’s most advantageous for investors to close put-option positions that are deep in the money. In other words, for put options whose underlying asset has declined to such a level that a maximum profit is all but assured, where is the point when it’s more advantageous to close the put-option position and instead collect the net interest income on the cash proceeds?

“A deep in-the-money put has no time value remaining and is priced at its floor value,” Barraclough and Whaley write. “The difference between forgone interest income and the value of future exercise opportunities determines whether the put should be exercised early or not.”

As it happens, professional investors appear to have realized that money is being left on the table. In response, they’ve developed an arbitrage strategy to capture the forgone interest of those who don’t exercise put options when it’s optimal to do so.

Barraclough and Whaley show that more than 3.96 million put options between January 1996 and September 2008—3.7 percent of all put options outstanding—were not exercised when they should have been. That cost long put-option holders more than $1.9 billion during that period.

In its simplest terms, when long put-option holders don’t exercise at the right time, short put-option holders can (and do) come in and snatch interest income.

Why do investors give up this money? One possible explanation lies in the additional trading costs for long put-options investors, according to Barraclough and Whaley. However, even when estimated trading costs are included, the Vanderbilt team still found nearly $1.82 billion in forgone net interest income.

Another reason is that retail put-option investors simply don’t know about—and don’t use—an appropriate early exercise decision rule.

“Both market makers and proprietary firms demonstrate that they know the early exercise decision rule and apply it in a timely and appropriate fashion,” Barraclough and Whaley write. “That is not to say that the nonprofessional traders are behaving irrationally. The costs of learning the early exercise decision rule and constantly monitoring open put-option positions may be too high relative to the perceived benefits.”

(In a similar 2007 study that Whaley co-authored, the researchers found that call option holders gave up an estimated $491 million during a 10-year period for failing to exercise the options on dividend-paying equities at the optimal time.)

Based on the finding of this most recent put-options study, Barraclough and Whaley say the bottom line is that long put-option investors are “implicitly paying a premium for the ability to early exercise that they rarely use.” In addition, market makers and proprietary firms are appropriating the potential gains of those in a short put-option position.

“Among other things, this raises fundamental concerns regarding contract design and market integrity,” they write. “If many option buyers pay for the right to early exercise but either cannot or do not take advantage of it as a result of exercise costs, unawareness of appropriate decision rules, inability to continually monitor open positions, or irrationality, would not the integrity of the market be better preserved with stock option contracts that are European-style?”

A version of this article originally appeared in VB Intelligence on Feb. 13, 2012.

From left, MBA candidates Ilya Tokhner, Mahni Ghorashi and Dan Angius are collaborating on a business plan to use stem cells to regrow human organs.

Mahni Ghorashi and Ilya Tokhner, both MBA candidates for 2012, have a short-term goal of completing their studies at Owen this May. Their long-term plans are slightly more ambitious—and could change health care forever.

Ghorashi, Tokhner and a third partner, Jordan Plews, have formed Regenome, a biotech startup that ultimately hopes to use stem cells to regrow human organs. Ghorashi and Tokhner were working in Silicon Valley last summer when they met Plews, a scientist whose expertise is turning adult tissue into pluripotent stem cells, which can become different cell types.

“Every cell has genes that are turned on and off,” Tokhner explains. “You can ‘convince’ a skin cell that it’s actually a stem cell. Then, by activating the appropriate genes, it can become a heart cell or any other cell type. It’s like a coffee mug made of clay. You can melt that down and reform it into something else, but it’s still clay.”

The potential for the technology is endless, but the Regenome team has to deal with first things first—like completing school. “It’s difficult at times to concentrate on classwork,” Tokhner says. “We’ve tried to take classes that are relevant and apply them directly to what we’re doing. Fortunately we’ve been able to get some independent study credit, and the university as a whole has been very supportive.”

As with all scientific and medical ventures, this one is full of hurdles, from funding to applying for patents to FDA approval. However, one point in Regenome’s favor is that stem cells derived from adult tissues don’t carry the same controversy as embryonic stem cells, which, as their name suggests, are derived from human embryos.

As a means of income to help fund research down the road, the group has come up with a cosmetic application for their technology and hopes to be in the market within a year. To help guide them through this process, Ghorashi and Tokhner have enlisted fellow 2012 MBA candidate Dan Angius, who serves as a venture consultant to the team.

“We’re looking to harness the potential of stem cells in a topical cosmetic application,” Ghorashi says. “Our next step is actively closing our A round of fundraising. Step two is to begin clinical testing while also building out the distribution channel of the products through cosmetics lines.” While the group hopes that their cosmetic application is a success, they view it, and the income it generates, as a stepping stone to their ultimate goal—one that redefines the notion of personalized health care.

“If you injure your spinal cord and lose mobility, you only have about a one-week window before scar tissue builds up and makes recovery practically impossible,” Tokhner says. “In the future we might be able to repair the damage using your own stem cells, but it could take months to derive the stem cell line. If you don’t have a stem cell line ready to go, you’re out of luck.”

That’s why the Regenome team envisions a future where stem cell banks are common. In effect the banks would serve as high-tech insurance policies against injury and illness.

“Say you need a new liver,” Tokhner says. “You call your stem cell bank and the stem cells are overnighted. We then arrange to literally grow you a new liver in vitro. You’re your own donor so there’s no danger of rejection, and you don’t have to take immunosuppressant drugs.”

Obviously the days of being your own organ donor are years away, but the Regenome team sees it as inevitable. “We’re not claiming that we’re going to be rebuilding hearts for people quite yet, but we see this as the future of not only personalized medicine, but of health care in general,” Tokhner says. “Longevity will go up and we’ll also start seeing new approaches in the ways the pharmaceutical and biotech companies conduct their research and development.”

As versed as they are in the technical side of their venture, neither Ghorashi nor Tokhner considers himself a scientist. Ghorashi, who is from Knoxville, Tenn., studied literature at MIT and did graduate work at Yale. He is also a concert pianist. Tokhner, whose family immigrated to the U.S. from Kazakhstan after the fall of the Soviet Union, comes from a long line of doctors. He, however, earned his undergraduate degree in international business at Long Beach State.

Their disparate backgrounds aside, this venture satisfies a common entrepreneurial spirit in both Ghorashi and Tokhner. “Early-stage companies and startups are the most creative types of business you can have,” says Ghorashi, the company’s Chief Marketing Officer. “Our roles for the next few years will be malleable because we’ll have to cover the whole range of responsibilities. There will be different challenges every day.”

Tokhner, who serves as Regenome’s CEO, agrees.

“I like to go really fast, and a startup venture is the perfect environment for me,” he says. “I worked for a large corporation and felt very stifled—I always had to ask permission. With this, I can run 100 miles an hour in every possible direction.”

My name is Alex Nicholson, and I’m 63 years old. A year and a half ago, I began a new job as a trading partner in a startup hedge fund. It’s the best job I’ve ever held—the best boss, the best environment and the most fun work. For the first time, I wake up early and can’t wait to go to work. I invest my own money in the fund, so I’m an owner as well as an employee. It’s also the most remunerative work I’ve ever done. I attribute my newfound success largely to the Vanderbilt Executive MBA program, but my path has been a circuitous one.

Alex Nicholson, who was the oldest in his Executive MBA class, credits the program for helping him reinvent his career.

I was a late arrival to the business world. I was born and raised in Nashville and earned degrees in philosophy and law at Stanford. But after 20 years in California and unfulfilling stints in education research at Stanford and in corporate law in San Francisco, I returned to Nashville to reinvent myself. The family business, Nicholson’s Hi-Fi, which sold audio-video systems and had been successful since 1946, was encountering difficulties in 1987 and needed help. At age 38, I decided to join my father in the business.

Nicholson’s Hi-Fi grew and prospered in the 1990s, designing and installing home theaters, lighting control systems and home automation systems in Nashville’s finest residences. One day in 1998, after I had taken over the company from my father, it struck me that I didn’t know what the hell I was doing running a business with 25 employees and $3.5 million in annual sales. I had had no business education and only minimal on-the-job training. I was managing by the seat of my pants and unsure of every major decision.

I met with Tom Hambury, Owen’s Director of Executive Programs at the time, to ask whether I could benefit from the Executive MBA program. I expected him to say no, that the program was intended for rising midcareer employees at large corporations, who could use the degree to earn promotions and raises. Tom startled me when he responded, “The Vanderbilt Executive MBA is a lock-step, generalist program without specialization. Corporate employees, who are specialists, benefit greatly from the program. However, small-business owners, who have to be generalists, benefit most of all because they need every course in the curriculum.”

Tom was right. To run my business, I needed to learn accounting, human resources, strategy, economics, negotiation, finance, organizational behavior, operations, marketing, leadership, entrepreneurship, and statistics. And so, at age 50, the oldest in my class, I entered Owen in the fall of 1999. I looked forward to getting to know the beautiful Vanderbilt campus, but I ended up sitting in the same building, in the same classroom, in the same exact seat every class for two years. But I loved every part of the Executive MBA program—the professors, the classes, the reading, the students and the teamwork—everything that I had disliked about law school.

Luke Froeb, the William C. Oehmig Associate Professor in Free Enterprise and Entrepreneurship, taught me where wealth comes from and convinced me to align my political interests with my economic interests. Ray Friedman, the Brownlee O. Currey Professor of Management and Associate Dean of Faculty and Research, taught me to negotiate from a broader perspective so that both sides could come out ahead. Germain Böer, Professor of Accounting and Director of the Owen Entrepreneurship Center, taught me how to start a new company, which made me glad my father had already done it, and I didn’t have to.

My favorite course at Owen, however, was the finance class taught by Bill Christie, the Frances Hampton Currey Professor of Finance and Professor of Law. Before Bill’s class, I didn’t even know what finance was. When I started to read the textbook over the semester break, I couldn’t put the book down. All of a sudden, the big picture of business made sense—companies, projects, debt and equity, dividends and buy-backs, the stock market. My favorite topic was options—puts and calls, profit and loss graphs, synthetic stock positions and real options.

But finance and options had little to do with Nicholson’s Hi-Fi. My purpose at Owen was to learn so that I could help my family business. I tried my best to share with my associates what I had learned. I found that task was much harder than anything I ever did at Vanderbilt. So I went back to the basics: I hired a coach to work on team building, which I considered the most fundamental lesson from Owen. We went on expensive overnight retreats, talked freely to each other and kept careful notes about our commitments to accountability.

None of it worked. I found out that the general manager disliked the salesmen because they could earn more than he could; the salesmen distrusted the technicians to install their systems correctly; and the technicians bullied each other and refused to follow directions from the general manager. Owen had elevated me to a higher plane of business consciousness, but I was unable to raise my company along with me.

After my graduation, the housing boom brought an onslaught of new competition in our industry—from the Internet, from big-box stores, and from local installers without the overhead expense of a retail store. Our revenue plateaued and by 2005 was starting to decline. The company that had supported our family so well for six decades now needed cash infusions from the family to cover its expenses. Soon I was $2 million in debt and unable to see a way out.

I finally realized that I had to let go of the idea of keeping the family business afloat. Remembering my interest in finance, I started taking classes in stock and options trading, which I enjoyed tremendously. In 2006 I sold our warehouse and started reducing my debt. In 2007 I sold the business operations to a Birmingham, Ala. audio-video company that wanted to open a Nashville branch. I made sure that all my employees had positions with the buyer and that all my customers’ jobs in progress were completed. Then I started trading options full-time for my own account. In late 2010 I sold my final parcel of real estate—the retail store, which had stood empty for four years—and paid off the remaining debt.

My solo options-trading career was successful, but my returns were inconsistent, and I felt unfulfilled. My wife, Laurie, encouraged me to find a real job—and get out of the house—while trading options on the side, so I went back to Owen to confer with Debbie Clapper, Associate Director of Executive and Alumni Career Services. She helped me redo my resume, which had been dormant for 25 years, and sent me job postings from Owen every day.

Then early last year, a friend of mine contacted me about a new fund she was starting. The best options trader I’ve ever known, she left the corporate world in 2007 to follow her passion: a charity she founded called Just Hope International, which provides infrastructure projects in the poorest parts of the world. While supporting herself and her charity by trading options, she started a closed hedge fund to allow her former business associates to invest with her.

When we met to discuss her new fund, she offered me the opportunity to invest. As I was about to ask if she needed another trader, she asked me first if I would be interested in working at the fund. Fortunately I had the requisite professional degree and a current resume. During the third interview, I knew she was going to make me an offer. Forgetting everything that Ray Friedman had taught me about negotiation, I jumped directly to my bottom line and said, “This is my ideal job. I know there is no money right now. I’ll work for free until the company can pay me.” She beamed with joy and said, “What a blessing you are to do this for us! But it may be a year or two before we’re profitable.”

Our company, Hope Investments LLC, based in Brentwood, Tenn., trades options and futures on the broad-based stock indices. We have been profitable since the first month and have now paid off our startup costs. A large share of our profit goes to support Just Hope International, the charity for which we are named. There are three partners, including myself, but no additional staff. My boss and other partner also serve as the president and executive director, respectively, of the charity. They are both now working to buy land in Sierra Leone, the poorest country in Africa, so that a self-supporting farm, orphanage, school, church and health clinic can be built there.

The opportunity at Hope Investments has enabled me not only to do well financially but to find a moral direction in my work. For that I have Vanderbilt to thank. Even though my original purpose in attending Owen was never realized, the Executive MBA program was the best educational experience I’ve ever had. Owen has given me the intellectual foundation to support a lifetime of continued learning in the business world. And when my perfect business opportunity came along, my education gave me the confidence to seize the moment—a moment that forever changed my life.

For David Owens, innovation on a personal level can be hard-wired.

“I am genetically an engineer,” he says. “My wife remarked one day as we were traveling, ‘Why do you always have a bag full of wires when we go on vacation?’ It’s just always been part of my identity.”

On a business level, innovation is a much slipperier commodity, says Owens, who studies the subject as Professor of the Practice of Management and Innovation at Vanderbilt. Although all businesses rely on timely innovation, most of them too often block it, according to Owens’ latest book.

Creative People Must Be Stopped: Six Ways We Kill Innovation (Without Even Trying), published in 2011 by Jossey-Bass, takes a clear-eyed look at six levels of stumbling blocks we unintentionally place in front of new ideas and their implementation. “I believe that everyone is creative, that everyone can and will move toward positive change given the opportunity,” Owens says. “My interest is understanding ways we stop people from doing that.”

At each of those six levels—self, group, organization, industry, society and technology—innovation faces resistance. “Take the organizational level,” he says. “Imagine the monumental courage it would take at Kodak in the ’80s to say, ‘Guys, I think we should stop doing film.’ It would be hard even for those people who knew that film’s days were numbered.”

He cites the Segway, a two-wheeled electric vehicle, as an invention whose potential on paper hit the brick wall of societal realities. “The Segway was too fast for the sidewalk and too slow for the streets,” he says. “That’s not a technical problem. They didn’t need the battery to last longer or to make the handlebars more comfortable. It was the societal restraints that they failed to address.”

Fighting the roadblocks that we and others throw in front of our own and each other’s creativity is at the core of Owens’ work as a teacher, mentor and consultant to organizations like NASA and the Smithsonian Institution. His is an almost counterintuitive approach.

David Owens

“It’s not, ‘Here’s how to be creative,’ but rather ‘Here’s how to stop your existing creative ideas from being blocked or killed,’” he says. “The punch line of the book is that there are at least six different ways to look at innovation, and you should pay attention to all of them because each one has the power to help you find the hidden barriers your innovation will face. What I find is that it’s the one perspective you ignore that ends up biting you.”

He sees creativity and innovation play out in real time as a mentor at the Entrepreneur Center, a Nashville-based nonprofit that connects entrepreneurs with investors and resources, and as Faculty Director of the Vanderbilt Accelerator Summer Business Institute for undergraduates and recent college graduates.

“Projects in the Accelerator,” Owens says, “touch all aspects of business—marketing, finance, operations, HR, manufacturing, strategy, design—and the program allows these students to experience the entire span of what happens in business in just a few weeks.”

He has watched any number of students carry ideas generated, refined or actualized at Owen into careers. He points to students who have gone on to do innovative work at places like Apple, Mattel, Microsoft, Google and Nissan. Another he cites is Jerome Edwards, MBA’04, Founder, President and CEO of Veran Medical Technologies, a St. Louis-based company that has developed cutting-edge imaging technology for surgical procedures.

Surgical Precision

Before earning his MBA at Vanderbilt, Edwards worked for Medtronic, one of the world’s leading medical technology companies. There he built a voltage-based navigation system that guided catheters inside the heart to burn tissue and regulate heartbeat. That technology, however, was spun off into another company and ultimately acquired by a Medtronic competitor in a $273 million deal. It was then that a frustrated Edwards decided to start a new chapter in his career.

“I wasn’t going to let that happen again,” he says. “Medtronic had been a great company to work for, but I decided to leave and go back to business school.”

“For us, innovation is about getting people into the field,
having them see surgeries, and coming back and sharing ideas
without barriers and without process.”

—Jerome Edwards

A Dean’s Scholar, Edwards enrolled at Owen in 2002 because he says, “I felt at home and felt the entrepreneurial spirit.” That feeling was shared by fellow student Evan Austill, BS’93, MBA’04. The two teamed up and started writing business plans for the type of technology Edwards developed at Medtronic, but for different organs. Edwards and Austill were encouraged by Germain Böer, Professor of Accounting and Director of the Owen Entrepreneurship Center, as well as former faculty member Bruce Lynskey, MBA’85. Edwards says Owen’s center “kept putting me in great opportunities in terms of business plan competitions and showcasing the plans to alumni.”

After receiving $65,000 in grant money, Edwards and Austill founded Veran Medical Technologies and paid for the first patent, which was written in the 810 Café at Owen. That patent was for a device that acts like a GPS system for the human body. An electromagnetic field and sensors are used to steer the device inside the body and then help sample or excise tissue that is suspected of being cancerous. The innovation is in making the device work in the lungs, which continue to move during surgery.

“With cancer,” Edwards says, “it’s about diagnosing as early as possible. In this case, we can get to the deepest, darkest regions of the lungs, get tissues from suspect lesions and progress to therapy if it’s cancerous.”

With just 28 people on staff, Veran is a small company where, Edwards says, “everybody participates in R&D—everybody does everything.” The company’s small size and flexible approach have helped it overcome the types of adverse group dynamics and organizational missteps that, according to David Owens, hamper innovation.

“One engineer in a small company can do the same amount of work as three in a big company because you’re freer,” Edwards says. “Process is good but it can be burdensome. Here, rather than meeting after meeting after meeting, you just walk in and ask a question, then go back to your desk and get to work again.

“For us,” he adds, “innovation is about getting people into the field, having them see surgeries, and coming back and sharing ideas without barriers and without process. Once you get to a level where it’s going to be turned into a real product, then you fold it into effective process.”

Renter’s Paradise

Adam Albright is helping RentStuff.com get a foothold in the marketplace with an unconventional business model.

For a small number of students, innovative ideas and an entrepreneurial spirit lead to the business world prior to graduation. That has been the case for Adam Albright, BE’10, an MBA candidate for 2012. Albright is Co-founder of RentStuff.com, which he describes as “a marketplace similar to eBay for renting rather than selling household items.” He teamed up with his two fellow co-founders when they needed someone with a technical background. Albright, who has been doing freelance software and website development since he was 10, earned his bachelor’s degree at Vanderbilt’s School of Engineering.

Participation in a summer-long incubator program at the Entrepreneur Center provided RentStuff.com with $15,000 in seed capital, mentoring and networking, and the chance to refine their presentations with the help of Michael Burcham, Lecturer of Entrepreneurship and President and CEO of the center. The program also gave them temporary office space.

“We have a couple of desks and white boards, and we make a lot of to-do lists and brainstorm ideas,” Albright says. “Part of my job is to explain the technological complexities behind what we want to do.”

The RentStuff.com model takes advantage of a fundamental shift in the way people access everyday goods. Albright cites a phenomenon called “collaborative consumption,” which he says is when “people try to own less stuff and rethink how they consume assets.” He and his partners have drawn inspiration from Zipcar, a membership-based car-sharing company, and Airbnb, which matches people needing short-term lodging with those offering everything from sofas to castles.

RentStuff.com handles payment transfers and security deposits, and offers reviews of people who use the service and the items rented, which include bicycles, cameras and even cocktail dresses. Recognizing that the target demographic skews younger means part of the innovation lies in finessing potential backers.

“Someone making six figures is not going to be renting golf clubs for $20 a day,” Albright says. “You have to explain to investors how it would work and who would be interested because it’s a new model and the math doesn’t add up for them. The investors aren’t the ones using it, but they’re the ones we need on our side.”

In other words, Albright and his business partners have faced some of the societal innovation constraints that David Owens writes about in his book. Society’s adherence to a conventional way of doing business sometimes prevents more creative approaches from gaining traction.

In the case of RentStuff.com, part of the solution lies in bringing small stores on board and offering to link them to potentially large audiences through the website. “We can emphasize the rental business side of RentStuff.com to investors, and then add that individuals can do it, too,” Albright says.

He finds that as a businessman, youth can be a mixed blessing. “Being young, you get a lot of helpful advice,” he says. “People are very willing to tell you about experiences they’ve had and pitfalls they’ve faced, and it speeds up the learning process. But when you go to an investor looking for half a million dollars, maybe they’d feel better if you were 50.”

Nashville, he adds, has been a good place to get attention and work out the kinks before carrying the concept to a larger city, where high-density neighborhoods and apartments concentrate the potential market for rental items like carpet cleaners and sporting goods.

Albright also attributes their early success to the company’s domain name. He believes that it has been crucial in driving people to their website. “RentStuff.com is a pretty identifiable name,” he says. “It’s easy to figure out what we do.”

Wallet Allocation

A great name is also the capstone of a highly regarded customer loyalty measure developed by Bruce Cooil, the Dean Samuel B. and Evelyn R. Richmond Professor of Management, and alumnus Tim Keiningham, MBA’89, with marketing research firm Ipsos Loyalty.

The Wallet Allocation Rule, as it’s known, came about because traditional metrics gauging customer satisfaction and loyalty “do a terrible job of linking with the share of category spending that customers allocate to the brands they use,” says Keiningham, the firm’s Global Chief Strategy Officer and Executive Vice President.

Bruce Cooil and his co-authors won the Next Gen Market Research “Disruptive Innovation” Award for their work on the Wallet Allocation Rule.

That need prompted a two-year study in collaboration with Lerzan Aksoy, Associate Professor of Marketing at Fordham University, and Alexander Buoye, Vice President of Analytics at Ipsos Loyalty. The study examined more than 17,000 consumers in nine countries and covered purchases in more than a dozen industries. A key datum was the number of brands being considered along with relative rank.

In the end, Cooil and his collaborators found that companies would be better served paying attention to how well they rank in comparison to rivals, rather than concentrating on achieving high customer satisfaction levels. According to their research, being a customer’s first, rather than second, choice can have a significant financial impact.

“What we found shocked us,” Keiningham says. “Our research uncovered a heretofore unknown relationship between customers’ perceptions of the brands they use and their share of wallet that could be easily calculated using a simple mathematical formula: the Wallet Allocation Rule.”

The rule makes it simple for managers to determine the financial implications of rank and of moves up or down, he says. Its implications include the fact that customer satisfaction is best understood in the context of competition, since it can rise even while per-customer spending declines.

“We looked seriously at alternatives,” says Cooil, who analyzed the data. “You see other papers that look at converting ranks to market shares using industry-specific parameters. We were expecting to have to go that way, but Alex suggested this other approach, and more complicated methods couldn’t do any better.”

Tim Keiningham

It’s an approach that breaks through the kind of industry constraints and societal barriers that David Owens studies. “We all start out with an idea of how things work,” Keiningham says, “and this view causes us to seek out information that supports that view and discount information to the contrary. As a result, we get a lot of ‘motivated’ research to prove what we want to believe.”

Keiningham and Cooil have become close friends through the years: Cooil was a best man at Keiningham’s wedding in Istanbul and has collaborated often with Keiningham and Aksoy, who are husband and wife. Their collaboration plays off their differing approaches and personalities.

“They get me interested in projects I might not find interesting otherwise,” Cooil says. “I have very different talents from Lerzan and Tim. They’re much more organized, much more focused on what industry really needs to know about, what would really help companies—and they get projects started.

“They’re the ones asking the questions and telling me what the current theory is. I go through and see how the models are working. Then they ask, ‘What can we do? We have this really interesting data. Can we come up with another approach or do something different with the data or clear up an issue that everyone’s convinced they understand but we’re convinced they don’t understand?’ They’re pretty demanding. They want answers and they keep projects going.”

Their four-way collaboration with Buoye on the paper “Customer Loyalty Isn’t Enough. Grow Your Share of Wallet,” published in the October 2011 Harvard Business Review, earned them the Next Gen Market Research “Disruptive Innovation” Award. It’s a major acknowledgement, although Cooil laughingly dismisses one of the accolades that went with it.

“They called us ‘thought leaders,’” he says, “It’s a mixed blessing because I’ve always hated the phrase. Doesn’t it sound Orwellian? But they did give us these really artsy trophies. I can’t even put mine in my study because my wife wants to put it on the mantel as an art piece.”

Special Resonance

Cooil’s and Keiningham’s work is another example of the worldwide impact of innovation with Owen ties. It is a key to what makes Nashville a city with special resonance as a business center for David Owens.

“I feel a real energy here once again,” he says, “with new startups and tech companies and a level of creativity in Nashville that really make it exciting for me.”

His work in breaking through innovation barriers is aimed at helping to keep the Owen School in the thick of that creative energy, as a meeting place of education and innovation that is as good for human development as it is for business development.

“With Accelerator, as with everything else,” he says, “we want to help students find that part of the wide spectrum of business that talks to them. I try to expose them to a lot of things to do, to give them enough diverse projects and experiences that they find something that makes them say, ‘I like marketing’ or ‘I’m good at managing teams.’

“I want to offer a perspective on business’ role in society, one that often gets lost,” he says. “It’s so much more than making money. It’s about feeling good about what you do and helping make the world an amazing place. How can you be a contributing member of society? Business is a great way to do that.”

Brent Turner at Pier 66 on Seattle’s Puget Sound

For a guy from Middle Tennessee, Brent Turner, MBA’99, sure uses a lot of nautical terms. That may be the impact of having lived near the Puget Sound in Seattle for the past 12 years, but his choice of words is fitting nonetheless. Turner is helping steer the future of Owen as chair of the school’s Alumni Board, and his enthusiasm, drive and leadership are just the types of invaluable assets you’d want in someone at the helm.

When Jim Bradford, Dean of the Owen School, asked him to lead the board last year, Turner was both honored and surprised. Even Turner’s assistant good-naturedly asked him if he was absolutely sure Bradford was serious. (Those are the kinds of self-effacing stories Turner likes to tell about himself.)

“I didn’t immediately tell [Bradford] yes, but I didn’t have to think about it long,” says Turner, Executive Vice President of Call Products for Marchex, a Seattle-based digital call advertising company.

That’s because of his deep-running zeal for all things Vanderbilt. Turner is one of the youngest members of Owen’s Board of Visitors, composed of corporate leaders from some of the world’s most prominent companies, who advise the dean on curriculum, the needs of the business community and the overall strategic direction of the school. He also serves as a class representative on the school’s Alumni Council, which encourages alumni participation and promotes philanthropic support. He even keynoted last year’s Discover Weekend for prospective students and has helped hire Owen graduates. And as if that isn’t enough, this marks his third year on the Alumni Board and second as its chair.

“He’s a passionate guy,” says Dave DiFranco, MBA’99, a Principal at private equity firm Blue Point Capital Partners. “Whatever he decides to spend his time on, it’s 100 percent. That’s true about SEC football, the Titans, the Owen School. That’s how he is, and he inspires others, like me, to get involved, too.”

Having a well-respected classmate lead the Alumni Board gives DiFranco a sense of confidence. “He’s not afraid to deal with tough stuff,” he says of Turner. “You might not always like what Brent has to say, and he doesn’t shy away from the tough issues. But that’s what a leader does.”

Turner’s decision to immerse himself in board activity at the school was fueled in part by Bradford’s all-hands-on-deck approach to bringing Owen closer to its goals. “He understands,” Turner says, “just how important it is to have as many people in the boat as possible if you’re trying to turn it.”

Part of the Returns

Turner was inspired to accept a leadership role because he saw that Bradford valued alumni input and sought answers to difficult questions. “I was impressed,” Turner says, “that he was willing to tackle what had been the central issue at Owen, which was: ‘What is the school’s strategy going to be? What’s going to be the role of rankings in determining our success?’ That’s a very hairy conversation to have, but I noticed him having it at both the Alumni Board level and Board of Visitors level as well as with faculty and staff.”

“Brent is a doer, a no-nonsense guy who is passionate about Owen and committed to its success,” Bradford says. “These qualities are the reason I picked him for this job.”

Turner bears in mind that many of his fellow board members travel thousands of miles for meetings because of a strong desire to “move things forward,” as he says. He has redesigned the Alumni Board into a working board, with teams to help support the school in targeted areas, such as alumni connectivity, student recruitment, career placement and fundraising.

Members have assignments and goals and report their progress regularly. “The idea is to make it meaty enough that it’s appealing but not so bad that it smacks of volunteer labor,” Turner says.

Fellow Alumni Board member Russ Fleischer, MBA’91, who is CEO of HighJump Software, a supply chain management software company, offers his own take on Turner’s style. “He’s not shy about reaching out and getting people involved,” Fleischer says. “Like so many of us, he has a strong passion for the school. That’s the attribute we both share—a deep passion for the school and a deep willingness to do whatever will help the school succeed and thrive in the future.”

Turner’s personal focus as a board member—improving alumni engagement—is approached with his usual fervor. His challenge for his fellow alumni: “I’m going to invest now with my time, talent and treasure because I want to be part of the returns.”

Turner’s board experience has helped him see the value of every contribution. With classmate Alli Zaro Fitzgerald, MBA’99, he hosted a well-attended webinar in 2011, in which he presented his thoughts about the school’s strategy. He followed with a live presentation to Seattle alumni.

“I think that everyone who attended left the call with a renewed enthusiasm for Owen,” says Fitzgerald, Director of Finance and Marketing at SecuriCheck LLC, a background research company. The positive vibe was created in part, she says, by Turner’s characteristically frank discourse, particularly about the elephant in the room—the perception by some alumni that the Owen School is undervalued in rankings. His message was clear: Any advancement will come about in large part from increased alumni involvement on many levels.

Turner is quick to say that no one considers rankings the only end goal, knowing that a school’s position can ebb and flow for no apparent reason. However, he says most people acknowledge that some of the rankings contain legitimate, objective measures of success and have to be heavily considered when planning and building strategy. In particular, they matter to prospective students and recruiters, who often perceive rankings as a litmus test of a school’s performance.

“The philosophy for a long time has been to build a world-class business school and the rankings will follow,” he says. “There’s a lot of that that’s true, and a big part that’s not true. There are some tough choices that have to be forced by the market. The dean’s big contribution is the message that we ought to take these more seriously, but we shouldn’t sell out.”

Alumni support is “the real chicken or the egg issue,” Turner likes to say. He believes that, if Owen is to make significant strides forward, alumni need to engage and support the school now instead of waiting to see if the new strategy works. It won’t be successful, he says, without their participation.

After receiving some lackluster class alumni giving numbers via email in January, Fitzgerald recalled that it took about 30 seconds for another email to hit her inbox. This one, from Turner, simply said, “Let’s talk.” Within minutes, a five-point plan was in place to stimulate class participation.

“He’s not afraid of difficult truths and approaches them head-on,” Fitzgerald says. “Yet he’s very approachable. He doesn’t lead by intimidation or try to impress everyone.”

Getting Somewhere Together

When analyzing problems, Turner relies on his training as an engineer to help him remain dispassionate. “That’s a gigantic asset in the business world,” he says. In the same breath, though, he admits to being not as strong in other areas. “On the other end, I struggle a lot with ideation and creativity,” he says. “I’m completely lost in a marketing meeting or going over advertising copy.”

Turner majored in electrical engineering at the University of Memphis and went to work for Porter-Cable, a power tool company in Jackson, Tenn., after graduation. He was with Porter-Cable for nearly four years as parent company Pentair positioned the brand for sales in big-box stores.

“As an engineer, I had a chance to be in a lot of the management meetings,” he says. “But I also walked the shop floor a lot and got to understand the differences between what the management team was trying to accomplish and what was actually happening on the front lines. It was very valuable. I learned how important it is to care about the people you are working with and who work for you. I learned the importance of clarifying their roles and making them feel safe if you wanted their best performance.”

That perspective led him to think seriously about entering management. “I can do this,” he thought.

Turner got to know an MBA intern from Kellogg Graduate School of Management at Northwestern who was sent by Pentair to evaluate Porter-Cable’s progress. The intern encouraged his interest in business, and Turner enrolled in some accounting classes locally. Surviving those, he then decided to take the GMAT, apply to “the big MBA schools,” as he says, and see what happened.

“The best fit, easily, was Owen,” Turner says. His interview was affirming and straightforward. Everyone he met “was being real with each other,” he says, “and I did not forget that.”

His Vanderbilt degree gives him a great deal of pride these days. “I will say that easily the period in my life when my perspectives on the business world, and the world in general, opened the most was the two years I spent at Owen,” he says.

His classmates were “phenomenal,” he says, and his training matched that of his peers in the industry, adding, “I can’t imagine it being much better.”

While there was pressure on Turner and his classmates to do good work, “what emerged was a collaborative, participatory environment,” he says. “It was a culture where everybody kind of understood we were all trying to get somewhere together. That’s not necessarily true in a lot of schools.”

Ray Friedman, the Brownlee O. Currey Professor of Management and Associate Dean of Faculty and Research, remembers Turner as a stellar student, respected by his classmates. “He was focused on managing people and had a sense of the importance of relationships,” Friedman says.

He’s been equally impressed by Turner’s work as an active alumnus. “He’s got a level head about him and a way of building relationships,” he says. “He’s focused on what we have to do and the need to get beyond planning and brainstorming to saying, ‘Let’s make things happen.’”

After graduating from Owen, Turner did a short stint with a private equity group in Dallas before moving to Seattle and a company called Avenue A, a startup focused on Internet advertising. Over the next nine years, Avenue A became aQuantive, which in turn became the biggest acquisition in Microsoft’s history at a reported $6 billion in 2007.

Turner, who had been Vice President of Operations for aQuantive, moved into the role of General Manager for Search and Media Network Businesses for Microsoft. He was part of the 2008 global rollout of Microsoft Media Network, Microsoft’s online display media business. Then, in 2009, he helped lead the global launch of Bing, a Microsoft Web search engine that now also powers Yahoo! Search.

From Microsoft, Turner headed to Marchex, a publicly traded company that is experiencing rebirth through a focus on digital call advertising. Marchex helps companies reach the right prospective customers using mobile media.

Instead of advertisers calling customers, smartphones provide the opportunities for consumers to place calls through the digital ads that they encounter while searching and browsing the Internet. “Most advertisers are intimidated by the complexity of figuring out how to place all those ads effectively,” Turner says. “That creates a role for an intermediary. We develop relationships with publishers of mobile advertising and make placing ads with them easy. Our job is to drive phone calls for our advertiser partners in a way that works for them economically and is not overly complex.”

Turner enjoys being on the front end of this new frontier in advertising. “There are a lot more opportunities than most people realize in these early stages,” he says.

Understanding the Conversation

Not surprising, Turner directs his energy into volunteer work in Seattle as well, chairing the board of REST, or Real Escape from the Sex Trade, a faith-based organization that seeks to divert at-risk minors from being trafficked into prostitution. There are a surprisingly large number of minors working as prostitutes in the Seattle area: REST puts current estimates at 450.

“In the garden variety case, a girl has a broken relationship with her parents and becomes a runaway,” Turner says. He explains that she might take a job in a strip club or a bikini barista stand where she is then befriended by a pimp who makes her feel special, at least initially.

Turner channels his business acumen into understanding, as he says, “the demand side of the equation so we can come up with strategies for reducing the number of ‘johns’ hiring the girls.” REST also works to proactively identify girls who are at risk and give them alternatives.

“We want to find choke points where we can prevent them from entering the life. We want to help them find work and understand their identity—that they are children of God,” he says.

The work is difficult and emotionally demanding—“This ain’t for everybody,” he explains—but it’s ultimately rewarding when girls come out of life on the streets.

Although Turner loves Seattle and is connected to the city in many ways, he relishes each opportunity to return to Nashville. When not in meetings at Vanderbilt, he often hops in his car for a visit to Columbia, Tenn., where his mother lives.

“I probably see her more often than most parents with local children,” he says with a laugh.

That filial devotion is not unlike the commitment he feels toward Owen. Turner believes that the school and its focus on an intimate community should not be taken any more for granted than a parent. It’s a message he hammered home in a speech to last year’s graduating class. “Make sure you appreciate just how special our culture is at Owen. Don’t forget just how awesome your classmates, faculty and fellow alumni are because you have had the opportunity to get to know them so well,” he said in the speech.

Turner is frequently reminded of the high caliber of people associated with the school, particularly in his work with the Board of Visitors. “This is an impressive stakeholder group,” he says. “These people are used to board seats and understand the conversation. They’re very good at getting their fingers right on some of the key issues or root drivers of problems and then stating their views on how to solve them. It’s pretty amazing in that crowd how quickly you go from stating an issue to some fairly clear and prescriptive input at a tangible level.”

As deserving as Turner is to be among those Board of Visitors members, he can’t help but inject some self-effacing humor into the discussion of his own place on the board. “They’re lowering their standards to have me on this thing,” he says. And then, he pauses to reflect on the scope of his alumni work at Vanderbilt.

“In my life, I’ve had the opportunity to do lots of things that are pretty amazing,” he says. “This is one of them.”

This wasn’t the first time I’d heard that sentiment. In this case, Smoke Wallin, MBA’93, spoke up at a meeting of the Alumni Board in late 2010 as part of a discussion on how the school could move up in the rankings and attract the best applicants. But telling our story meant more than just having our faculty’s work cited in The Wall Street Journal or on Marketplace. To really break through the clutter and claims of other schools, we needed a bolder brand identity that would make the world sit up and take notice, proclaiming loud and clear that we are second to none.

For years, Vanderbilt’s business school has been talked about as a “hidden gem,” a “best-kept secret,” a place that “you’ve got to experience to understand.” Those aren’t entirely bad qualities, and for a long time those attributes helped distinguish us from other top-ranked schools.

However, with an aggressive new strategic plan in place, which includes pushing into the top-20 B-schools amid ever-greater competition for talent, we could no longer afford to be a hidden gem or best-kept secret. Telling our story had become—and remains—a competitive imperative. Below are just a few of the key steps in our yearlong journey.

Step 1

Find a creative partner

In the same way consumer brands tap into renowned advertising agencies to sharpen their edges (and boost sales), we too set out in early 2011 to find a firm to help raise the school’s profile. With the support of an internal advisory board, we screened more than a dozen agencies from across the country, including ones that had worked with other top B-schools. We plowed through a mountain of amazing—and some not so amazing—work, finally narrowing the field to three firms. Each of these finalists presented their capabilities, including a broad array of creative approaches they’d used to help other clients achieve their goals. But in the end we selected an agency in Columbus, Ohio, called Ologie. A highly creative branding agency with about 50 employees, it has a client base that ranges from nonprofits and academic institutions, such as the Cleveland Clinic and Purdue University, to private companies like NetJets and the Food Network. Their creative team blended bold designs with smart, mission-driven content. It was a perfect match for our intimate, collaborative, and yet academically rigorous personality.

Step 2

Prioritize our audiences and objectives

Everyone agreed that we needed to tell our story, and tell it boldly. But who needed to hear it? Obviously prospective students are a core audience. As is the wider Owen community, including faculty, current students and alumni. We also wanted to reach peer schools, which hold sway in the rankings and whose institutions serve as feeders for top student and research talent. But the one constituency that, with Ologie’s help, we learned could really spark a virtuous cycle was corporate recruiters—those who hire our students as interns and graduates. By broadening and deepening our relationships with employers, we’d see a short-term payoff in higher starting salaries and greater job placements. In addition, we hoped to leverage a growing alumni base within select companies to help boost our national profile for the long term and further strengthen the school’s network.

Step 3

Discover ourselves

Now that we knew who should hear our story, the next question was just as important: What story do we want to tell? Each of us can rattle off five or six great things about Vanderbilt’s business school, but honing that message in a way that’s unique, credible and resonant with the people we’re trying to reach is a daunting task. So Ologie started by talking with dozens of stakeholders—faculty, staff, students of all programs and ages, as well as employers. Everyone agreed that “culture” was our single biggest strength. But here’s the rub: No two people described the culture in the same way. What’s more, employers don’t immediately see how our culture benefits their organizations. Ologie worked through this problem and identified a vocabulary for talking about our culture in a way that all audiences would find compelling and beneficial.

Step 4

Create … then listen, listen, listen

Rather than go straight to designing a new series of ads, Ologie first drafted a manifesto—a galvanizing public declaration that explained in clear, energetic terms why this school is special. (Incidentally Apple’s “Think Different” campaign started with a manifesto.)

The agency then brought these ideas to life with a series of mock-ups of advertisements, sample pages from an MBA viewbook, online ads and layouts of all the other materials we use on a day-to-day basis to promote the school. Our job was to take those items back to our audiences and understand what worked, what didn’t and why.

As expected, there were elements that resonated with everyone, such as, “We’re the B-school built for the persistent. The genuine.” There were some that split opinions: Students rallied around “Rewrite the Rules,” for example, but alumni disliked it. And there were other things that were simply best left on the cutting room floor.

Step 5

A breakthrough!

Using this feedback we spent much of the summer refining (and refining some more) the points that proved most salient among all the people we surveyed. Finally we began to see the outlines emerge of what we believe is a profound and truly unique brand narrative for the school.

Step 6

Tell the world

The time had come to begin incorporating these new design and content elements into our marketing materials. The first step involved developing a positioning brochure that homed in on our manifesto in a creative manner. We also worked with Ologie to create an 83-page booklet using stats, facts, quotes, people and places to tell all that’s worth knowing about Vanderbilt’s MBA program. Over a six-week period, we sent these two items to more than 6,000 prospective students as well as 1,000 B-school deans, MBA and Executive MBA program directors. The results? It’s too early to tell, but, if it’s any indication, Jim Bradford got a call from another dean telling him that he liked the book so much that he was going to copy it.

Starting in 2012, we began dialing back our involvement with Ologie. We’re now turning to an extended Nashville-based team of copywriters and designers to help translate Ologie’s new ideas and fresh look into our websites and future marketing materials. Next up is an ad for both print and larger displays, such as at airports.

As you watch these materials take shape, I think you’ll find that they are truly different than anything we’ve done before. And yet, they capture our spirit perfectly—just as we had hoped.

March 7: Michael Burcham, Lecturer of Entrepreneurship, has been chosen as a “champion of change” as part of President Barack Obama’s “Winning the Future” initiative. Burcham was honored at a White House ceremony for his leadership in mentoring the next generation of entrepreneurs.

Bloomberg Businessweek

Nov. 2: MF Global Holdings Ltd.’s bankruptcy, the eighth-largest in U.S. history, is exposing a lack of internal controls that may have prevented a last-minute rescue of Jon Corzine’s futures broker. Hans Stoll, the Anne Marie and Thomas B. Walker Jr. Professor of Finance and Director of the Financial Markets Research Center, is quoted.

Jan. 11: B-school electives have taken a turn for the creative, tackling everything from New York City’s problems to health care to humanitarian relief. In the Fundamentals of Quality Improvement in Health Care elective, students from the Owen School join nursing and medical students to focus on process improvements at Vanderbilt University Medical Center.

CNNMoney

Feb. 3: Worried that the Federal Reserve and the U.S. dollar are on the brink of collapse, lawmakers from 13 states, including Minnesota, Tennessee, Iowa, South Carolina and Georgia, are seeking approval from their state governments to either issue their own alternative currency or explore it as an option. David Parsley, the E. Bronson Ingram Professor of Economics and Finance, is quoted.

Feb. 4: For some, Super Bowl Sunday is all about the game. For others, the ads take center stage. Jennifer Escalas, Associate Professor of Marketing, offers three keys to a killer Super Bowl ad: a meaningful narrative, strong linkage to the brand, and “equity,” which occurs when brands that appear perennially build up a positive association in consumers’ minds.

The Dallas Morning News

Feb. 14: Life-threatening problems persist at Parkland Memorial Hospital and are more widespread than previously known, enabled by a “business as usual” culture that has kept it from fixing serious breakdowns, according to a new report. Ranga Ramanujam, Associate Professor of Management, is quoted.

The Economist

Jan. 3: As Brazil’s economy booms, U.S. business schools are catering to increased interest in the country by seeking new partnerships and programs with local institutions. Vanderbilt’s Americas MBA for Executives program is mentioned.

Financial Times

Jan. 30: The Owen School ranks No. 4 nationally and No. 7 internationally in the human resources category of the Financial Times Global MBA Ranking 2012.

Jan. 30: Interest in joint J.D. and MBA programs is being driven by changes in the demand for legal services, says Dean Jim Bradford.

Forbes

Dec. 2: Insurance is not a wealth redistribution tool in which good risks cover the bad ones to ensure that everyone pays the same rate, writes Larry Van Horn, Associate Professor of Management and Executive Director of Health Affairs.

Jan. 26: Bruce Barry, the Brownlee O. Currey Jr. Professor of Management, is quoted about clichés and jargon used all too frequently in the business world.

Fortune

Nov. 23: MBA applicants from India and China face significantly higher rates of rejection by many top U.S. business schools than either domestic candidates or those from Europe or Latin America, according to a new study by Poets & Quants. John Roeder, Director of Admissions, is quoted.

Dec. 9: The Owen School rose three places to 25th this year in a new ranking by Poets & Quants. The list is a composite of the five major MBA rankings published by Bloomberg Businessweek, The Economist, Financial Times, Forbes and U.S. News & World Report.

The Globe and Mail

March 13: Diverse in scope, new executive MBA programs often share similar features: an international learning component, a blend of in-class and online study, and curriculum delivered by multiple partners. The Americas MBA for Executives program is mentioned.

Investor’s Business Daily

Feb. 14: Companies can teach people to boost their what-if mindsets and can learn how to generate new approaches by working with employees in a number of brain-building drills. For example, David Owens, Professor of the Practice of Management and Innovation, suggests allowing workers to get out from behind their desks and try thinking in a new place. Read more about David Owens.

Politico

Nov. 29: Opponents of Dodd-Frank financial regulations have been emboldened by a circuit court ruling that faulted the Securities and Exchange Commission for failing to determine the full costs of implementing the law. The SEC responded to the ruling by bulking up its Division of Risk, Strategy and Financial Innovation, a sort of in-house think tank created in 2009 to examine the economic impact of the rules. The appointment of Craig Lewis, the Madison S. Wigginton Chair of Management, to lead the division is mentioned.

SmartMoney

Dec. 11: There is one way to steady a stock portfolio without unloading shares: an options strategy known as “covered calls.” The idea is to collect extra income now in exchange for giving up potential gains later. Bob Whaley, the Valere Blair Potter Professor of Finance, is quoted.

U.S. News & World Report

Feb. 23: Business students seem to be increasingly seeking jobs in the policy, technology and management of education, say education professionals. The Owen School is among the top-ranked business schools that have student-run education clubs.

Feb. 29: Three-year programs are increasingly being explored by colleges and college-bound students and parents as a more affordable route to a degree. Others, like Vanderbilt alumnus Ted Griffith, BS’08, MSF’09, earned both a bachelor’s degree and a master’s in four years.

March 13: The Owen School improved to No. 25, three spots better than last year, in U.S. News & World Report’s latest rankings of business schools. Read more about the rankings.

March 21: Read McNamara, MA’76, Executive Director of the Career Management Center, discusses sectors that are hiring and offers advice to B-school graduates.

April 3: Admissions officers at the Owen School discuss what they look for in applicants and what sets the school apart.

The Wall Street Journal

March 28: Alumnus Doug Parker, MBA’86, Chairman and CEO of US Airways, is interviewed about consolidation in the airline industry.

April 5: The Owen School has increased support for job-seeking foreign students by hiring a dedicated career-services staffer for the international contingent; scheduling “how I did it” presentations by international students who successfully secured jobs in the U.S.; organizing job-hunting trips to Asia; and offering webinars to address cultural gaps and identify companies that are more open to sponsorship. Tami Fassinger, BA’85, Chief Recruiting Officer, and alumnus Juan Jose Thorne, MBA’10, are quoted.

Linus Hall is the Owner of Yazoo Brewing Co., which produces several different beers, including the Pale Ale pictured here on the bottling line.

Running a craft brewery requires a personal touch, but few pour themselves into the job like Linus Hall. His Nashville-based Yazoo Brewing Co., which has expanded its reach across the Southeast since opening in 2003, is as much a testament to his handcrafted approach to beer making as it is to the larger aesthetic and philosophy that guide his decisions as a business owner.

“You go down the beer aisle of any grocery store, and it’s mostly run-of-the-mill brands in boring metallic blue cans,” he says. “We try to go in the opposite direction with our brewery by being offbeat and memorable.”

Named for the river that winds its way past Hall’s hometown of Vicksburg, Miss., Yazoo produces nine different types of beer, including a rotating seasonal variety. Several of them have labels featuring paintings by his wife, Lila. “Even though we ended up in Nashville, we wanted to reflect our Mississippi roots in our name and image,” he says. “It’s about capturing that Delta folk-art feel.”

Distinctive as it is, the branding explains only part of Yazoo’s growing popularity. From the outset Hall knew that success hinged not only on the quality of his beer, for which he turned to the American Brewer’s Guild for a craft-brewing course, but also on the quality of his business plan. For the latter he enrolled in the Vanderbilt Executive MBA program, which he says gave him a strong foundation in strategy and operations, as well as a better understanding of what it takes to be an entrepreneur.

Nearly 10 years into it, Hall still gets a heady feeling from being in charge of the business he’s built from the ground up. It’s not unlike the warm sense of satisfaction that his patrons feel after sampling one of Yazoo’s fresh drafts.

“If you don’t get a thrill from what you’re doing, you’re not going to make it,” he says. “For me that thrill is walking into the taproom on a busy night and seeing customers enjoying our beer and having great conversations.

“Beer brings people together, but good beer makes them happier.”

Sheru Chowdhry

Sheru Chowdhry, MBA’00, laughs about his earliest experience living in New York City. His first apartment was in Times Square, and there was little respite from the noise and lights. “It’s a wonder that I didn’t end up half-deaf and half-blind from all of that,” he says. “It was sensory overload.”

Chowdhry eventually settled on the other side of the Hudson River, where today he and his wife are raising their two children. The move has afforded him a better perspective on the city. “You can’t beat the view of the skyline,” he says. “Of course, I still work in Manhattan, but it’s nice to be able to step outside of it and take it all in.”

In some sense, Chowdhry had to go through a similar shift in his career, and he now appreciates what he does for a living all the more. As Managing Director and Partner at Paulson & Co., a New York-based hedge fund company, he is fully immersed in the investment, or “buy,” side of Wall Street. Among his responsibilities is overseeing Paulson’s investments in distressed securities, such as companies that are entering bankruptcy.

“I love what I do,” he says. “Bankruptcy investing is a good amalgamation of legal, financial and strategic thinking—about how we position ourselves in the capital structure and create value for the investors.”

Prior to Paulson, Chowdhry worked in mergers and acquisitions on the banking side of finance. It was not a good fit, he admits. “I was an M&A banker for three years, but it wasn’t right for me,” he says. “The buy side was calling me.”

Fortunately his Owen experience helped prepare him for the adjustment. “Vanderbilt was one of the best things that happened to me,” he says. “It has such an excellent finance program, and I learned so much from my fellowship working at the Financial Markets Research Center.”

It was this debt of gratitude that prompted Chowdhry to host Owen students during this past October’s Wall Street Week, a tour of several different financial firms organized by the school’s Career Management Center. Chowdhry gave the students an overview of how Paulson’s hedge funds operate, but the opportunity also let him share some advice about working on Wall Street—advice that comes only from having a broad perspective.

“Markets can be taxing, so it’s important that you find that sweet spot and love what you do,” he says. “In the long run, the people who do best are those who enjoy their careers.”

“I had to learn it the hard way,” says Ramos, Vice President of Engineering at Schneider Electric, one of the multinational companies that not only have a huge Nashville presence but also make Vanderbilt and Music City an ideal hub for this new style of international education.

Schneider Electric brought Ramos, a native of Mexico, to Nashville, and he has since grown with the company, tasting the increasingly global flavors of modern business firsthand. His experiences have afforded him valuable insight, which Tami Fassinger, BA’85, Associate Dean of Executive Programs and head of the Americas program at Owen, gladly welcomes. Ramos is among several alumni who have helped shape the program with their advice.

Mario Ramos

Fassinger stresses that businesses cannot rely on the same old parochial strategies in this global era, and so the Owen School has tailored the Americas program, which officially launched in early August, to offer its participants something new and different. To borrow a phrase from modern combat journalism, the program “embeds” students in international experiences while they work toward their MBAs. In addition to learning about global business management practices in the classroom, students gain real-world preparation on the ground, both in Nashville and thousands of miles beyond.

All about Relationships

Owen isn’t alone in this Americas venture. Three other business schools of similar prestige—Fundação Instituto De Administração (FIA Business School) in Sao Paulo; Instituto Tecnológico Autónomo de México (ITAM) in Mexico City; and Simon Fraser University’s Beedle School of Business in Vancouver, British Columbia—also are participating. The four partner schools plan to each enroll 15 students in the future, capping the total for every class at 60.

The Americas students spend the first year at their home schools, with some interaction with one another via the Web. Global study teams are then formed during the second year by making use of technology for conferences and virtual meetings. The second-year students also rotate together to each campus for immersion in weeklong residencies that incorporate each locale’s cultural advantages and challenges.

Fassinger says that students will work both virtually and hands-on “across borders, language, culture and time zones … on various coursework assignments and a yearlong capstone project.” The academic payoff is that each student will graduate with an Americas certificate conferred by the four participating universities as well as an MBA from his or her home school.

“More important,” she says, “they will have taken a deep dive into expert topics by Americas region and school, spanning everything from family-owned enterprises unique to Mexico to cross-cultural negotiations in Canada to sustainability models in Brazil to launching new ventures in the U.S.”

As a practical matter, managers will be sharpening international networking skills each step of the way. Learning how to apply those skills across linguistic and geographical borders is one of the most important aspects of doing business globally, says Ingrid Calvo, EMBA’09, a native of Colombia who works as International Controller for Gibson Guitar.

“In other countries it’s mostly about relationships,” as opposed to in the U.S., where “you get down to business right away,” she says. In her work, which now has her heavily focused on China, it’s critical to establish and maintain business relationships with government officials and business partners.

Ingrid Calvo

Calvo can testify to the effectiveness of her Vanderbilt MBA in these situations. “It has provided opportunities for me, has strengthened my core skills in managing global business, and has better prepared me for additional expatriate assignments,” she says.

She admits, though, that the international component of the Americas program would have been ideal, had it been available. “If given the choice,” she says, “I would have preferred to have been part of the Americas program.”

Ramos, who hopes to direct Schneider employees into the program in the future, knows from experience how valuable cross-cultural pollination can be. “When Tami first mentioned the possibility of opening up an Americas program, I was pretty excited,” he says. “It’s a tremendous opportunity. There are a lot of people in Latin America who could benefit from this type of program.”

And it’s equally valuable for Americans looking to the greater world market for production and distribution, Ramos adds. “It will help companies managing teams or trying to build their businesses in Latin America,” he says. “It will give them a lot of insight into the local environment—how to do business there, how to deal with the government, how to do business in a different culture.”

Schneider Electric, a global specialist in energy management, has 130,000 employees worldwide, producing a variety of systems that are designed to manage and conserve energy. The company has spread into markets like India and China, but Ramos says the Americas program’s lessons will translate anywhere. “There are various ways of going to market. Organizational behaviors are affected by different cultures with different values,” he says. “You need to understand how that works to really be able to do business in these countries.”

Looking at an Entire Hemisphere

As new as the Americas program is, international business has long been a focus for Owen. The idea for such a program was first planted soon after the establishment of the North American Free Trade Agreement (NAFTA) between the U.S., Canada and Mexico in 1994. “About 15 years later, we were finding that our Executive Development Institute client companies were looking at an entire hemisphere rather than individual countries for management decisions,” Fassinger says. “When we started to notice that, we thought that we needed to address it pragmatically.”

In the late ’90s, Owen experimented with a short-lived International Executive MBA program based in Miami. The IEMBA students were bright and hard-working—many of them have since gone on to prosperous careers in the Americas—but the logistics of the program itself proved too challenging. Among the roadblocks to the Miami venture were the lack of a Vanderbilt facility in the city and the added complications of monthly travel time and expenses for participants.

After talking with IEMBA alumni, Owen took steps to ensure that the Americas program is more practical than the Miami experiment. Fassinger says physically locating the new program at Vanderbilt is important because the university already has an acclaimed Center for Latin American Studies with which Owen can share human and academic resources. Also the decision to schedule weeklong residencies during the second year, as opposed to biweekly or monthly classes in each location, means less travel for those involved.

Tami Fassinger

In all, the Americas program provides a more balanced approach than its IEMBA predecessor—as Fassinger says, it’s “a complete immersion experience and a complete Vanderbilt experience.”

Of course, practical concerns, such as tuition, credit and diplomas, had to be worked out prior to launch. “One of the things institutions struggle with is: How do you transfer credit? How do you figure out admission differences?” Fassinger says. “We decided only to enroll our own students and not share revenue, so we went with schools that have great admissions standards of their own. Second, we figured out a formula where we all are responsible for an equal part of the delivery of the second-year residency experience.”

Each of the partners brings something unique to the residency weeks. For example, in Vancouver, an international city with strong Asian business interests, focus will be placed on cross-border negotiation and collaboration. Meanwhile Brazil will offer lessons in sustainability and bottom-of-the-pyramid marketing. In Mexico, where most of the businesses are family-owned, attention will be paid to global competitiveness among such companies.

“When they come to Vanderbilt, they will look at American innovation,” Fassinger says. “We’ve been talking to the big companies that make Nashville great: Nissan, Bridgestone, LP, Schneider, Gibson. And we will use the Nashville Entrepreneur Center to show how to launch startups that can become the next multinational companies.”

Interaction with prospective students in the U.S. showed there was a need for the Americas program. “They wanted a deeper global experience than what we had previously offered,” she says. “We surveyed our pool of candidates, and it was clear there was a demand for it.”

Ramos says that Vanderbilt already has an international mindset, but in the past, much of the discussion was “very U.S.-centric” by nature. “One of the important things about this program is that by having discussions with people who do business directly in those countries, we’ll have debate and ask questions as to what is the right answer,” he says. “The conversations will be diverse.”

William Thomas

Universal Business Principles

William Thomas, BE’92, EMBA’11, Executive Director of Quality and Sales Engineering for Bridgestone Americas, just graduated from the Executive MBA program in July. Like Ramos, he is somewhat envious of the opportunities that await the students enrolled in the new Americas program.

“If this international program had been available when I was starting in ’09, I absolutely would have taken it,” he says. “Our business, the tire business, is becoming more of a global game. The managers in the 21st century need a global perspective.”

Bridgestone provides training to prepare employees for the international market, but Thomas emphasizes the value of the Americas program. “By having them physically take classes in Canada, Mexico and Brazil, it puts them in contact with other cultures and begins the process of changing the way they think about doing business in another country,” he says.

With Bridgestone, Thomas learned international business by serving as Assistant Plant Manager, Responsible for Quality Assurance, at the company’s Buenos Aires facility. “What I discovered with my experience in Argentina is that there are universal business principles that can be applied across borders,” he says. “But the cultures you operate in require you to modify your approach to make yourself more effective.”

Thomas is now investigating how this new program might benefit his staff. “I’m talking to two of my managers in Argentina who are contemplating going back to school and getting their MBAs in Buenos Aires,” he says. “I asked them to consider going to Sao Paulo and getting in this Americas program instead [through FIA, Vanderbilt’s partner in Brazil].”

Thomas also looks around the Nashville office to identify Bridgestone managers who are hoping to supplement the international preparation they already receive at the company. One such employee is enrolled in the inaugural Americas class: Bridgestone’s Phillipia Pundor, Section Manager, Global Mobility and Immigration.

Phillipia Pundor

“We have a number of teammates who work on foreign assignments outside their home countries,” Pundor says, pointing to the approximately 50 expatriates she assists throughout South and Central America as well as in the Netherlands, Portugal, Liberia, the Democratic Republic of the Congo, India, Thailand and Japan.

Pundor, who has a background in industrial/organizational psychology, says the Americas program offers precisely what she needs. “I’ve looked at a number of different graduate programs, and Vanderbilt was definitely the most attractive,” she says. “This will put me in a position of growth and opens a lot of avenues into roles across the organization.”

Fellow student Jon Haworth has a similarly positive outlook on the program. He, however, took a more indirect path to it. The Vice President of Product Innovation and Plant Operations at Des-Case Corp., which manufactures filtration products for industrial lubricants, was set to enter the Executive MBA program a year ago, but the birth of his son put his enrollment on hold.

It was a fortunate turn of events.

“As they rolled out the Americas program, I quickly jumped over to that, because the international component of our business has been growing so fast. There will be things I learn from Day One in this program,” he says. “It’s exactly what I need to move up in this company.”

Jon Haworth

The son of Baptist missionaries, Haworth grew up in Brazil and is fluent in Portuguese. He also has worked abroad quite a bit for Des-Case, which sells products in 52 countries. His experiences overseas have impressed upon him the need for broader international skills.

“The American way doesn’t always get the job done,” he says. “On the other side of the world, they approach it from a totally different perspective.”

His understanding of this fact has made him appreciate the opportunity at hand all the more. “It’s not just a typical international program where you talk about how business is done elsewhere,” he says. “In this case, you actually experience it.”

He adds, “I haven’t heard it stated this way elsewhere, but in my opinion, while this program focuses on the Americas, the things you learn can transfer elsewhere. It’s really a global program, even though it’s not marketed that way.”

Fassinger agrees. “Jon is right that the learning can transfer,” she says. “We just made the decision to be more thorough about the nuances in the Americas, rather than spread ourselves too thin across many cultures.”

Michael Bowling

Congruent to the Culture

Michael Bowling, EMBA’97, grasps the idea of transferring knowledge as well as anyone. He talks with satisfaction about his experience as an Executive MBA student and how it helped him prepare for his current role as President of AT&T Mexico—a remarkable leap considering that he had never traveled outside the U.S. prior to his Owen experience.

Bowling went to work for AT&T 21 years ago with an electrical engineering background, but it was his desire to explore a different career path that brought him to Vanderbilt.

“I looked for a program that had the kind of impact that I thought I wanted on my career,” he says. “I wanted an executive program to learn the business half to help in my progressions.”

The lessons he learned were invaluable, he says, adding that Owen planted the seed that led him to work in Venezuela, Peru and now Mexico. “On our class trip [the required international residency], I think it was the first one for the EMBAs, we were here in Mexico City,” he says, recalling that he sat in the city center and “sketched out a plan to be an expat.”

After that trip, he became determined to take his career global.

“And here I am,” he says with a laugh.

These days, he’s loaning his expertise to Fassinger and her colleagues at ITAM in Mexico City. “I’m very positive about the program,” he says. “I think it will be great.” In particular, he believes the expanded international study component will pay off.

“It’s critical for leaders in business today to not just understand, but to be able to be effective in a global environment,” he says. “What you’re trying to do is reach your business objectives, but they should be congruent to the foreign culture you’re operating in. You aren’t going to be able to change the foreign market to fit your paradigm.

“The ones who aren’t successful are the ones who can’t drop out of their own mindset, the ones who say, ‘This is how we do it in the U.S.’ You might as well say, ‘This is the way we do it on the moon.’”

From left, Faith Rhoades, Carol Slivka, Kelli Powers and Nat Richardson

Few people get to witness the evolution of a brand new hospital from an insider’s perspective. Even fewer get to play a hand in how it takes shape. Yet, thanks in no small part to Vanderbilt’s Master of Management in Health Care program, four health care administrators from Huntsville, Ala., have had just such an opportunity.

Kelli Powers, Nathaniel “Nat” Richardson, Faith Rhoades and Carol Slivka—all members of the MM Health Care Class of 2011—spent the better part of the yearlong program collaborating on a capstone project to evaluate a new facility being built by their employer, Huntsville Hospital. Their project has continued to influence decision making in the organization well after graduation, but it isn’t the only part of their studies that has left a lasting impression. During their frequent trips up Interstate 65 to the Owen School, the four forged deep bonds with each other and their classmates, and the resulting friendships and experiences they’ve taken back with them on the southbound return have been life-changing.

“I haven’t felt so pumped about a program and the educational experience in a long time,” says Richardson, Vice President of Operations at Huntsville Hospital. “What’s been energizing has been the number of individuals in the classroom who are so spread out across the health care spectrum. We sit in a room with so many dynamic minds.”

Richardson was the first from the Huntsville team to commit to the MM Health Care program, which is designed to provide students with the business fundamentals and skills to manage people, programs and processes within health care organizations. While firmly entrenched in his present position, he wanted to further his education through a degree that would have direct benefits for his current job and career trajectory.

Jeff Samz, who had previously worked at Vanderbilt University Medical Center, brought the MM Health Care program to the attention of his colleagues at Huntsville Hospital.

Richardson heard about the MM Health Care program from Jeff Samz, Chief Operating Officer of Huntsville Hospital and former CEO of the Vanderbilt Heart and Vascular Institute. “He knew I was seeking the next level in my career,” says Richardson, who aspires to a C-level position at a large hospital system. “This program seemed to provide the most value and also aligned with where I am in my career.”

Samz’s and Richardson’s enthusiasm soon caught the attention of Slivka, Huntsville Hospital’s Director of Finance; Rhoades, Director of Medical Staff Services; and Powers, CEO of Athens Limestone Hospital, which is affiliated with the Huntsville system. Rhoades had begun graduate work elsewhere but readily switched gears for the chance to study at Vanderbilt with her colleagues.

“When the human resources director asked me if I was interested in changing to Vanderbilt, I said, ‘In a nanosecond,’ because of the reputation of the school and because I had a chance to take it with three other people from my organization. That’s life support,” Rhoades says. “The other contributing factor was the health care focus.”

Slivka shares this sentiment. “I don’t see myself doing something outside of health care. If you’re going to do this at this point in your life, you want to have some immediate take-away and provide some real-life value back to your company,” she says. “Huntsville Hospital has been willing to make an investment in me for knowledge I’m going to bring back and use. I really like that part of it.”

Huntsville Hospital enthusiastically backed the team approach to graduate education as it naturally aligned with the organization’s succession planning. “They’re interested in advancing their careers, and it’s a way for us to retain some of our top people,” Samz says. “Investing in them, we think, will pay off not only in the skills they learn in the program but it will keep them with us.” Samz also believes the fact that the four formed a “working pod” will continue to benefit the organization in the long term.

The program was appealing to Huntsville Hospital in other ways, too. There was Vanderbilt’s stellar academic reputation to consider, as well as the MM Health Care program’s flexible format, which is geared toward working professionals. Plus, the students were exposed not only to Vanderbilt University Medical Center, which is widely regarded for its patient care, research and biomedical education, but also to Nashville’s dynamic health care business community, which includes Hospital Corporation of America and a variety of other health care companies.

“There’s just nothing else like the Nashville market,” Samz says.

The Future of Health Care

“What the world needs is changing,” says Dr. Mark Frisse, MM Health Care Faculty Director, Professor of Management and Accenture Professor of Biomedical Informatics at Vanderbilt. He explains that the MM Health Care program helps students see way beyond the limits of their institutions to the future of health care.

“First we expose them to a radically broader view of the world,” he says. “Then we bring the world into the classroom. This can only be done a few places in the country.”

Larry Van Horn played a key role in launching the MM Health Care program.

Larry Van Horn, Associate Professor of Management and Executive Director of Health Affairs at Owen, adds, “The cost, quality and access problems facing the U.S. health care system are monumental. The clinician who understands the science of medicine and the science of business is in a position to create more value for our health care system.”

MM Health Care students attend classes every Thursday night and one weekend each month. Traditional B-school classes—such as marketing, finance, accounting, logistics, operations and leadership—are taught on weeknights, while the weekends are dedicated to health care. Frisse believes the classroom experience serves as a great leveler for everyone in the program. “You can’t tell the doctors from the administrators,” he says. “They have a uniform identity. They’re all students.”

The classroom benefits the faculty as well, he adds, noting that the high caliber of students helps energize the instructors. “The best teachers want to run these classes because they learn from these experiences,” he says.

Mark Frisse

During the course of the year, students develop close friendships, becoming sounding boards for one another. “Every day we’re texting or Skyping or emailing. Everyone relies on one another. Everyone wants everyone to succeed,” says Rhoades, who came into the program with a bachelor’s degree in health care management.

Richardson echoes that sentiment. “There’s a wealth of knowledge in that room. Everyone is from different walks of life and different regions of the country,” he says. “You can’t put a price on that much mind value.”

For Rhoades, the lessons of the classroom often can be implemented at work on Monday morning. She credits the high-quality instructors. “That started from Day One in the very first class. That is what knocks the socks off me. They are beyond experts,” she says.

Powers agrees. “It could not have been timelier. I’m looking at productivity and wait time [at Athens Limestone], and I’ve been able to bring what I’ve learned back to work,” she says. “It’s wonderful to be able to discuss ideas with people who don’t necessarily report to me.”

Meanwhile Slivka’s co-workers noticed a positive change in her right away. “I have a different set of eyes and I analyze things a little bit differently,” she says. “My boss said he can tell a difference in the way I look at things and in the comments I’ve made.”

The degree is perfectly suited for students like the four from Huntsville, says Sarah Fairbank, MM Health Care Program Director. “I tell prospective students we are designed for two kinds of people,” she says. “It’s for people who have been ‘siloed,’ who are working in a narrow field with lots of specialization. That might be a contracts person, a supply chain specialist, someone from the finance side or a physician with a narrow specialization in medicine. These are people who need a broader view of health care, along with management tools.

“The other type of person we see is someone who is coming into the health care field with a generally technical background—an operations specialist or IT specialist who has worked in other industries and is now in health care.”

Students range in age and experience. Some are young professionals preparing for a future in health care, while others are midcareer and ready to move up the ladder. There are also physicians who later in their careers want to use their accumulated wisdom in new and different ways.

A key element of the curriculum is personal coaching since the students are often transforming their own roles within their organizations. “The coaching was phenomenal,” Powers says. “It has helped me get on track and be more productive. I’m a very organized person, but I’ve learned that I need to devote specific time to reading articles and delegating.”

Sarah Fairbank

The average time commitment outside the classroom for the MM Health Care degree is at least 10 to 15 hours per week, though the initial learning curve may be steep at first for students who have been out of school for many years. In addition to these hours, the Huntsville students had to shoulder the extra commitment of traveling further than most students—approximately 100 miles each way. The routine is intense, Rhoades admits, but still very doable. “It’s such an achievable goal, so it takes the pain out of the travel,” she says.

Rhoades says it helped that members of the Owen community were standing ready to ensure their success throughout the whole process. This was no more evident than when deadly tornadoes ripped through northern Alabama last April. Staff, faculty and fellow students rallied to assist the Huntsville team and their communities.

“The support has been incredible. They pay such close attention to the needs of the students,” Rhoades says. “We in Huntsville have especially realized that. In bad weather, when it became clear we couldn’t get there, they quickly rounded the wagons and got some technology together. We had a live class by tapping in electronically.”

Breaking New Ground

As professionals make their way up the ladder, Fairbank explains that the challenge becomes, “How do you get people to look at you differently?” An integral part of fast-tracking that change in perception is another key part of the curriculum: the capstone project, an eight-month consulting engagement during which a team, usually of four people, takes on an institutional problem as if they were professional consultants. Through the project, the students are able to demonstrate immediate economic value by tackling important organizational issues.

“We seek to ensure that everyone coming out of our program projects a dramatically enhanced identity within their organization,” says Frisse, who oversees the teams’ work.

For the Huntsville team, their capstone project’s focus was evaluating the potential impact of a brand-new hospital in Madison, Ala., a community outside of Huntsville. The Madison area is growing, vibrant and affluent, with an average household income of $90,000. Many residents are scientists and engineers working for NASA, the defense industry or technical firms.

The group concentrated specifically on how to position obstetrics services in Madison. “This is the first hospital to be built in Alabama in many years,” Rhoades says. “Not very many people get to participate in building a hospital from scratch. But we also had to consider that we belong to a hospital system with other hospitals that we need to be concerned about. It’s not all about us. This is about creating the best business for everyone so that we’re all successful.”

The Huntsville system first built a wellness center, physician office building and urgent care center on the property in Madison. The success of those ventures demonstrated the viability of a hospital. “Owen helps you think strategically, and that’s what [the new hospital in] Madison is all about,” Rhoades says. “Many years ago, the strategic planning began with a purchase of land. It began with a vision and a goal. Everything you gain from Owen classes and programs ties into that kind of scenario. I put it into practice every day in my job.”

For Powers, the capstone project was particularly interesting since the new hospital in Madison had the potential to impact her facility, Athens Limestone Hospital, the most. While some factors will remain unknown until the facility is up and running next year, Powers says the planning process helped alleviate undue concern about the new hospital’s potential impact and shifted the focus to the strategic side.

Richardson adds that building obstetrics services around the strategic mission of each of the hospitals makes sense, since the birth of a child often provides a family’s first exposure to a medical facility. “We have to get it right so that the mother and the child have the absolute best experience,” he says. “And we have to make sure that we design it so we don’t hurt the other hospitals. We may eventually find that it’s best to provide those services primarily at one hospital. It’s a very delicate situation, and we have to get it right.”

Besides generating practical ideas for Huntsville Hospital to implement, the project also helped the students learn how to work together as a team. “The strength of our team is that we’re coming at the project with different knowledge skill sets. We all come from diverse areas that are all important to the outcome we seek,” Richardson says. “I love writing and doing the research and pulling things together. Kelli has a global perspective on what other organizations are thinking. Carol looks at everything from the financial standpoint: What’s the bottom line impact from the standpoint of income statements or the balance sheet? Faith brings the whole physician perspective to the table.

“Now I appreciate my team members at a whole different level.”

Richardson also appreciates just how far he himself has come during a year’s time. It has been a journey marked not so much by miles logged on the odometer or hours in the classroom, but rather by immeasurable moments of progress. In the end, the MM Health Care program delivered him closer to his lifelong goals and gave him something that should pay dividends the rest of his career—confidence.

“I know I’m ready for my next project,” he says, “no matter where or what that’s going to be.”

Executive MBA Class of 2011

This past spring Bruce Brockenborough, EMBA’01, President and CEO of Hannan Supply Co., issued a challenge to the Executive MBA Class of 2011. If they would raise at least $145,000 for their class gift with 100 percent participation, he would pledge money of his own to help launch much-needed scholarships within the EMBA program. The Class of 2011 responded by raising a total of $150,000—the largest amount ever raised by an EMBA class—with every student contributing. Brockenborough followed through as well, and the combined gifts established both the Brockenborough Family Scholarship and EMBA 2011 Scholarship funds, which will provide financial support for deserving EMBA students.

Knight (left) and Bosslet will go just about anywhere to get the interview they’re after.

How did you two end up working together? And what’s the story with this name “Blark!” that follows you everywhere?

Blake: “Blark!” started as an inside joke. It’s a play on our two names.

Clark: In case that wasn’t obvious.

Blake: We flash it at the end of each video as a production credit in the Owen Podcast Series. We didn’t think anyone would notice, but as our first year progressed, our classmates co-opted “Blark!” and began referring to us as a single entity. So I guess at least a few of them had been watching.

Clark: We suspect they started using it because they hadn’t bothered to learn our individual names yet.

Blake: Well, to be fair, we didn’t exactly make it easy for people to differentiate us. We’re both from Texas and we both majored in marketing as undergrads at Texas A&M. We both joined OwenBloggers at the beginning of our first year and started working for the school’s Marketing and Communications office as social media consultants. We both have dark glasses and wives who are arguably out of our leagues. People act like we must be lifelong friends, but one year ago we’d never met.

Clark: Well, that’s not exactly true. As we’ve recently pieced together, we apparently met at a house party as undergrads, just after Blake started dating his future wife, Kristi, who happened to have a couple of classes with me. More than likely, we were loitering around the keg and talking about music, since Blake was in a popular local band at the time and I secretly idolize musicians. And that was it.

Blake: After the chance encounter, we went our separate ways. I had a pretty unique hybrid background of marketing and design, and so I worked for two successful startups in Dallas as their one-man marketing machine. Clark … I don’t even know why he got a marketing degree.

Clark: Yeah, I put it to good use. I started in state and local tax at KPMG and then joined the internal strategy group at Texas Children’s Hospital.

Blake: But Owen brought us back together.

Clark: It was very much like the movie Serendipity.

Blake: Strikingly similar. My wife recognized Clark’s name on the list of admitted students, which prompted an email, which prompted calls, which prompted meeting up before school even started.

Clark: All of which prompted lots and lots of scheming. We definitely both have an innate drive to create stuff when we think there’s a need. Or, in the parlance of our peers, to “blue sky” it.

So how did the Owen Podcast Series come together?

Blake: Early on, we agreed that Owen, and just about every other business school we visited, could have a more robust media library. This would allow prospective students to feel like they really know the school’s people and culture during their search process, even before visiting the campus to experience it firsthand.

Clark: This notion was the seed of the Owen Podcast Series, which built upon previous Owen podcasts by adding an interview format and bringing in an eclectic mix of guests, ranging from faculty members to community leaders to local business owners. The goal is to showcase everything that makes Owen and the surrounding community unique.

Blake: Prospective students don’t just care about the curriculum and pedigree of the schools they seek out. That’s important, but they also care about the culture and social activities outside the walls of academia. It’s a package deal, something we were keenly aware of after talking our wives into dropping everything and moving to Nashville. Based on that, we knew that prospective students and their partners want to know they’ll have some fun during the whole grad school experience.

Clark: The city of Nashville has a strong creative class and a strong entrepreneurial spirit. It’s a lot more than a country music scene, or even a health care scene, although it obviously has all of those things, too. We really believe the city is a key part of the Owen value proposition.

Blake: We found the school to be incredibly fertile ground for organic, student-led innovation. Before stepping foot in a classroom, we brought our podcast idea to the admissions team, who saw it as a great marketing tool, not only for prospective students but the Owen community at large. We were then put in touch with Yvonne Martin-Kidd, Executive Director of Marketing and Communications.

And how did the idea go over?

Clark: We were two anonymous, overeager students. They could have easily scoffed. But after presenting our vision, the response was overwhelmingly supportive.

Blake: It was, “What do you need to get going? Cameras? We have HD, Flip, handhelds and studio lights. Microphones? We have lapels and handhelds, all wireless. Anything you need is at your disposal whenever you need them. And, by the way, once you get going we can give you a prominent spot on the new website we’re creating for Owen and possibly include featured podcasts in our newsletters.”

Clark: It was pretty unexpected. They not only signed off on the project, but they wanted to become actively supportive in its success. Blake and I both came from an undergraduate school with almost 50,000 students. Texas A&M has a strong culture of student involvement, but there’s a lot of red tape. In this case, the speed of approval and level of encouragement was incredibly refreshing.

How did you become affiliated with OwenBloggers?

Clark: OwenBloggers has always prided itself in leaving off the veneer, so to speak. It’s far less engaging as a member of an audience when you feel like you’re being pitched to. Everyone in this era has built up a natural layer of skepticism, and when you feel a sales pitch coming on, you immediately put up a mental barrier. We wanted the podcasts to avoid that sheen. It needed a home within the constellation of online touch points at Owen, and it found a kindred spirit in OwenBloggers.

Blake: We were both familiar with the site after visiting it many times as prospective students, and we were excited about the opportunity to partner with something that had a built-in audience and an established brand. The site was flush with material and had a broad international readership, but had outgrown the blogging platform it was created on. We met with the current and past leadership of the site, who were already tossing around the idea of moving the site onto WordPress (a popular blog publishing platform).

So you do some programming as well?

Clark: This was all in Blake’s sweet spot. When we found out about the WordPress initiative, I basically volunteered Blake’s Web design and programming expertise to build the new site. The only thing I more willingly offer than my own time is someone else’s.

Blake: We had the opportunity to combine the veteran OwenBloggers site and the yet-to-be-tested Owen Podcast Series into a multimedia conglomerate, the likes of which had never been seen before … at least in graduate student-led media circles … in the southeast United States … to our knowledge.

Clark: We are basically young Rupert Murdochs. I hope he doesn’t do anything stupid before this article appears.

And all of this is in your first month or so as students?

Clark: I think it sounds more ambitious after the fact. At the time, we just wanted to create content. We were excited about starting the next chapter in our lives and about having access to some really great minds. Honestly, the podcast series was mostly an excuse to reach out to interesting people and pepper them with questions, all under the guise of content creation.

How do you decide on which guests to interview?

Blake: We started looking for guests here at Owen, which is ripe with passionate personalities and big thinkers. We wanted to provide a relaxed, intimate look into people whom incoming students would be interacting with their first year. Faculty such as Michael Burcham, Lecturer of Entrepreneurship; Dave Owens, Professor of the Practice of Management and Innovation; and Larry Van Horn, Associate Professor of Management; as well as Read McNamara, Executive Director of the Career Management Center, all sat down with us to talk about what drives them personally and professionally. While we touch on the requisite questions regarding their roles at Owen, we’re really looking to establish the people behind the message and create a real experience for the viewer. Simple lighting, one camera shot, natural settings, and, with the exception of raucous bird squawks and ambulance noises, very few edits.

Clark: In one of our first episodes, Bart Victor, the Cal Turner Professor of Moral Leadership, mentions the Carnegie Bargain, which is the mindset that one must first do well financially in order to have the means and freedom to do good philanthropically. And then we talked about the misplaced focus of many organizations on fixing the suffering of poverty instead of alleviating the poverty itself, which is a key tenant in the Project Pyramid courses here at Vanderbilt. It was, at least in my mind, genuinely interesting stuff, and I think that’s when we realized the true potential within the series. Our litmus test has always been: If I’m a prospective student and I stumble upon this, is this compelling? Does it flesh out my opinion of the school? And if the answer is yes, it has some value.

Blake: I think people really connect with genuine passion. It comes through the screen and grabs you as a viewer. When you see a professor speak passionately about something, it helps you uncover what’s behind the syllabus and understand why Owen students are regarded not only for their spreadsheets but also their convictions.

Clark: Once we had our sea legs, we started looking into the community to find local business leaders who are focused on making Nashville unique. No one would call us shy, but it was still daunting to essentially cold call someone to ask them to be on a podcast that’s still more of an idea than a product.

Blake: As it turns out, we had an ace up our sleeve: being students. People are definitely more receptive to the idea of sitting down with students, especially if they can tell you’ve done your homework and know their craft a bit.

Clark: Blake and I have a certain aesthetic, and that aesthetic is good beer and good music.
Blake: We reached out to local companies like Yazoo Brewery, Third Man Records (Jack White’s label) and Hatch Show Prints and asked for an hour of time with the owners. These are all small shops, so their time is valuable, and they’re not hurting for media coverage, not that we even qualify. But when we prefaced the request with “I’m an MBA student from Vanderbilt,” they gladly opened their doors to us.

Clark: I think that’s a testament to two things—the cachet of the Vanderbilt name and the tremendous sense of community here in Nashville.

Blake: At the end of the day, we really enjoy it. We meet incredible people and talk about great ideas. When our podcast with Ben Blackwell, Director of Operations of Third Man Records, was picked up by the local media, there was an admitted sense of pride in knowing our efforts helped raise the local profile of the school.

So what’s next for “Blark!”?

Clark: The hardest part is not coming up with the ideas, or even initially bringing them to fruition. That’s easy because it’s thrilling and somewhat finite. The hard part is sustaining something once the newness and the sense of accomplishment has worn off a bit. So a big focus for us this year is making sure the podcast series and the website are sustainable. The quick turnover at business schools can kill a lot of good ideas because capturing that institutional knowledge is so challenging. But we are blessed to have some really great peers at Owen right now. There’s a palpable eagerness among the student body to make Owen a better place while we’re here.

Blake: We recognize that this is a unique point in our lives. We have a lot of precious commodities right now: time, resources, administrative champions and lots and lots of smart people around us. It’s a recipe for doing some really fun stuff that’s not only personally rewarding but also reflects well upon the school.

Cheryl Chunn has been named Associate Dean of Development and Alumni Relations. She previously worked as Director of Development, Departmental Programs, for Vanderbilt University Medical Center.

Mark Cohen, Professor of Management and Law, has rejoined the Owen School following a leave of absence as Vice President for Research at Resources for the Future, a noted environmental think tank in Washington, D.C.

Brian McCann, MBA’04, Assistant Professor of Strategic Management, has become a permanent, full-time faculty member.

Fond Farewells

Bob Blanning, Professor of Information Technology, Emeritus, was among 16 retiring Vanderbilt faculty members honored during Commencement May 13.

Tricia Carswell, Associate Dean of Development and Alumni Relations, has stepped down to become Executive Director of Principal Gifts at her alma mater, Furman University.

Jon Lehman, Associate Dean of Students, has stepped down to become CEO of PAX Scientific, an engineering research and product design firm, but will continue to teach at Owen.

Ron Masulis, the Frank K. Houston Professor of Finance, who was away on a leave of absence to the University of New South Wales, has elected to join that university on a permanent basis as the Scientia Professor of Finance.

Mike Shor, Assistant Professor of Management, has accepted an opportunity to become Assistant Professor of Economics at the University of Connecticut, where his wife is also a faculty member.

This year was no exception. Brett Sweet, Vice Chancellor and Chief Financial Officer at Vanderbilt, chaired presentations on regulating risky banks, while Margaret Blair, the Milton R. Underwood Chair in Free Enterprise at Vanderbilt Law School, led a session about the federal rule-making process.

The primary focus of this year’s FMRC conference, held May 5–6, centered on implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act. Almost a year after the bill was signed, federal regulators continue to draft new rules overseeing hundreds of trillions of dollars’ worth of activity that touches everything from the credit-default swaps that played a role in the 2008 financial crisis to overhauling Fannie Mae and Freddie Mac. In fact, the task of implementing the law has proven so massive that regulators have pushed many of its deadlines back six months to Dec. 31, 2011.

Even as regulators finish their work, however, many questions remain (including from those within the government) about the law’s ultimate impact.

Mortgage Reform

Edward DeMarco talked about mortgage reform in his keynote speech at the FMRC conference.

Regarding home mortgages, Edward J. DeMarco, Acting Director of the Federal Housing Finance Agency (FHFA), said in his FMRC keynote speech that keeping Fannie and Freddie in an indefinite state of conservatorship—which has stretched on for more than three years—poses risks to an already fragile sector. Total taxpayer support of the companies could climb to $363 billion by 2013, according to FHFA estimates, and so far none of the reform proposals put forth by Congress and the White House have gained much political traction.

“The only thing Congress can agree on is not renewing their original charters,” he said.

Whatever plan does finally emerge for Fannie and Freddie, DeMarco indicated that there are at least three elements that any framework must include:

• Uniform mortgage standards: From collecting borrower data to developing guidelines for home appraisals, he said the industry needs consistency and transparency throughout the life of a loan. Without these elements, the world of private capital won’t be able to price and evaluate risk correctly.
• Diversity of product offerings: Lenders shouldn’t lock themselves into offering only traditional 30-year fixed-rate mortgages just because data standardization is needed. “This is a big country with lots of people in many different situations,” he said. “The mortgage market of the future really needs to be not just liquid and stable, but it needs to have an appropriate diversity of offerings.”
• Clarity about the role of the taxpayer: To properly calibrate how risk is assigned, priced and managed, DeMarco said it’s imperative that investors fully understand the role of the taxpayer in any future mortgage finance system.

Derivatives Oversight

There’s a climactic scene in Michael Lewis’ bestselling book The Big Short in which Dr. Michael Burry, the neurologist-turned-investor, finally sees his $1.9 billion bet against subprime mortgages start to pay off—that is, until he contacts his counterparties and tries to collect.

As it happened, the very banks from which Burry purchased the products that, in theory, should have been making him rich were also the same institutions responsible for pricing his investments.

“It was determined by Goldman Sachs and Bank of America and Morgan Stanley, who decided each day whether Mike Burry’s credit-default swaps had made or lost money,” Lewis wrote.

Under the Dodd-Frank Act, many of those kinds of privately traded derivatives—worth as much as $600 trillion—will now be transparently priced and exchanged through a central clearinghouse. In addition, the Securities and Exchange Commission (SEC) will split oversight of these financial instruments with the Commodity Futures Trading Commission (CFTC).

Joanne Moffic-Silver, Executive Vice President and General Counsel for the Chicago Board of Options Exchange, told FRMC conference participants that her company is interested to see how the two federal overseers handle these new regulations.

“One question with the Dodd-Frank Act is: Will having two agencies split jurisdiction over functionally equivalent products work?” Moffic-Silver said. “Ideally, and this is my personal opinion, there should be little or no difference between the SEC and CFTC on swaps rules.”

As written in the new law, the SEC will handle swaps that are backed by securities like a single or narrow group of stocks; the CFTC will manage the rest, including 22 listed categories that include interest-rate, credit-default and currency swaps.

But Moffic-Silver said Dodd-Frank includes a number of possible exceptions that would exclude various swaps from being traded through a clearinghouse. In addition, the new law allows for the creation of a new “Swap Execution Facility” (SEF) that would be an alternative to listing on an exchange. Current proposals from both the CFTC and SEC differ on some of the specifics of how these SEFs would operate, Moffic-Silver pointed out.

“The rule-making process has been interesting. The SEC and CFTC do talk, they do meet, and they have a current memorandum of understanding where they are supposed to coordinate regulation of similar products,” Moffic-Silver said. “But the proposals have differed in some very important areas.”

‘Bail-ins’ instead of Bailouts

On Sept. 15, 2008, the world awoke to what Andrew Ross Sorkin, writing in The New York Times, called “one of the most dramatic days in Wall Street’s history.”

The storied brokerage firm Merrill Lynch was sold for $50 billion, just half of what it had been worth the previous year; and after failing to find a buyer, Lehman Brothers filed the largest bankruptcy on record, culminating in a painful $150 billion liquidation.

After those catastrophic events, Congress approved a $700 billion bailout several weeks later to help banks unload their “toxic” mortgage-related assets to prevent further shocks. Now, instead of once again using taxpayer money to help prevent a contagion risk that could bring down the banking world, there’s discussion about designing a “bail-in” mechanism.

Wilson Ervin, Managing Director at Credit Suisse, explained in a presentation at the FMRC conference that a “bail-in” would give regulatory officials the authority to impose a resolution designed like a prepackaged bankruptcy. “Think of a Chapter 11 bankruptcy on steroids,” he said.

“When an airline goes out of business, air traffic control doesn’t go haywire. When a phone company goes down, we can still make phone calls,” Ervin said. “But when banks go down, it’s different.”

Using the case of Lehman Brothers as an example, Ervin said by writing down assets and converting a portion of the debt to new equity, the bank could have preserved a capital base of more than $40 million, giving it some hope to raise additional investment from other financial services firms.

“The process would not be pretty, but overall investors should be relieved by the result,” Ervin wrote in an Economist essay he co-authored on the subject. “In [the Lehman] example the bail-in would have saved them over $100 billion in aggregate, and everybody—other than short-sellers in Lehman—would have been better off than today.”

New Vanderbilt Research

In addition to the speakers from government and private industry, several members of the Owen faculty presented new research, including Bob Whaley, the Valere Blair Potter Professor of Management, who discussed his collaboration with Jacob Sagi, the Vanderbilt Financial Markets Research Center Associate Professor of Finance, in launching NASDAQ’s Alpha Indexes. Also Nick Bollen, the E. Bronson Ingram Professor of Finance, shared results from a recent paper investigating hedge fund investment strategies, while Hans Stoll, the Anne Marie and Thomas B. Walker Jr. Professor of Finance and Director of the FMRC, presented new research with Thomas Ho, the FMRC Research Professor of Finance, examining the interaction between financial markets and regulations.

When looking at most world maps, we take for granted our points of reference. North is up, south is down, and the U.S. is in the top left corner, just as it was when we first learned geography in grade school. Not everyone, though, subscribes to this point of view.

For decades, a group of trailblazing mapmakers has tried changing the world as we know it by changing how we see it. Their so-called reversed maps depict what seems like an upside-down world, where countries in the Southern Hemisphere have supplanted their neighbors to the north. The underlying message is that the perch from which we view the world is an arbitrary one. North is still north, of course, but that doesn’t necessarily mean that it should be at the top of the map. Nor should countries at the top be considered “above” everyone else—either literally or figuratively.

After graduating from college, I learned this firsthand, but without the aid of a reversed map. Torn over my job prospects (or lack thereof), I did what many 22-year-olds with wanderlust do: pick a place on the globe and go. Joined by a couple of friends, I set out for Chile, a country I knew very little about, with the intention of staying a year. My thought was that I would teach English to pay the bills and travel around South America at every opportunity, all while brushing up on my Spanish.

I ended up doing all of these things, but the experience as a whole left a much deeper impression on me than I ever could have imagined. During the course of the year, I made lifelong friends and gained a lasting appreciation for the culture. I also came to realize that my preconceived notions of what it means to be American were limited at best. In truth, our New World neighbors have rightful claim to that name as well, for in spite of our differences, we share a corner of the world with a common pioneering spirit.

Of all the discoveries I made that year abroad, I probably learned the most about myself. It’s ironic that I had to travel halfway around the globe to get to know the person in the mirror better, but that’s exactly what happened. Finding a new vantage point from which to view the world afforded me a much better understanding of my place in it.

I imagine the inaugural class of the new Americas MBA for Executives program, which is discussed in this issue’s cover story, will come to a similar realization. One of the program’s main selling points is the exposure to business practices in Brazil, Mexico and Canada, but the unspoken value is the personal journey that will accompany those experiences. By immersing themselves in those cultures, the students will be letting go of the familiar and looking at the world—and themselves—with a whole new perspective.

In other words, they’ll be doing those trailblazing mapmakers proud.

Innovation in education, much like in business, originates from intellectual curiosity—from asking “Why not?” and “What if?” in a structured and often empirical way. At Owen, our innovation is sparked by a business world that is always evolving. This can be seen in the unique and powerful ways in which our faculty’s research addresses specific needs brought to us by the business community. It’s also evident in the program creation that has taken place at Owen during the past six years.

Programs like the MS Finance, Master of Accountancy and Master of Management in Health Care are all products of resource- and market-based opportunities, creative thought and a willingness to act. Likewise the new Americas MBA for Executives, which is the topic of this issue’s cover story, arose from the need to provide students, particularly those who are seeking assignments in the Western Hemisphere, with a better understanding of global business.

By building innovative programs such as these, we’re able to expand our brand and product offering, while also attracting applicants who are valued by the employment market both in good economic times and bad. Years of experience and observation have taught me that the only real sustainable competitive advantage in business is to surround yourself with the best and brightest. Education is no different. A school like ours can maintain a successful path only if it’s able to attract, hire and matriculate exceptionally talented individuals.

The programs you read about in this issue of Vanderbilt Business illustrate the great strides we’ve made, but there’s still much work to be done. To compete with other schools, we must find the resources to continue bringing the best students and faculty to Owen. Your support is the key to our success, and I hope that we can continue counting on it in the months and years to come.

Respectfully yours,

James W. Bradford
Dean, Vanderbilt Owen Graduate School of Management
Ralph Owen Professor of Management

Bappa Mukherji is the CEO of Gics Foods, which packages food into convenient microwaveable retort pouches.

Ashoke “Bappa” Mukherji is no stranger to pressure. Soon after graduating from Vanderbilt with both an MBA and a law degree, he was thrust into one of the more challenging roles a budding young attorney could ask for—sitting second chair in a first-degree murder trial. It was his first trial ever.

When asked about the stress he was under, he laughs, “It could have been worse. At least I wasn’t the one on trial.”

Mukherji spent the ensuing years at a Nashville law firm, where he concentrated mostly on mergers and acquisitions. Advising clients on these deals suited his Owen School background, but he always wondered what it would be like to “move to the other side of the table,” as he puts it, and go into business for himself.

In 1997, with the help of two business partners, Mukherji did just that, launching a startup that manufactured recycled toner cartridges. That idea eventually blossomed into Guy Brown Products, a Brentwood, Tenn.-based office products distributor that had revenue close to $200 million in 2010. Mukherji served as CEO of the company until he stepped down last fall.

“At Guy Brown we differentiated ourselves from competitors by focusing exclusively on selling to large, geographically dispersed organizations and doing it better than anyone else,” he says. “It’s similar to what I’m doing today—studying the market and figuring out where our company has room to operate.”

The company he’s referring to is Gics Foods, a food packaging business in Greenville, S.C. Appropriately enough, this latest venture is all about pressure—albeit a different sort from what Mukherji is used to.

Under his guidance as CEO, Gics packages food into retort pouches, which are plastic laminate and metal foil containers that can withstand the high temperature and pressure used to cook what’s inside them. Convenient microwaveable bags of rice are just one example of this growing technology that’s revolutionizing not only how food is preserved but also how it’s prepared.

“We’re the first company focused solely on retort packaging,” he says. “That’s what makes us stand out.”

That, and of course, a bit of pressure.

Craig Lewis

Mary Schapiro, Chairman of the Securities and Exchange Commission, named Owen professor Craig Lewis the SEC’s new Chief Economist and Director of the Division of Risk, Strategy and Financial Innovation (Risk Fin) this past May. Lewis, the Madison S. Wigginton Professor of Management in Finance, had been working on sabbatical at the SEC since January 2010.

“I am honored that Chairman Shapiro has offered me the opportunity to lead the division and the SEC’s economists at this critical juncture,” Lewis says. “I look forward to fostering durable new analytic models that will promote efficient and effective work throughout the agency, from rule-writing through enforcement.”

Lewis joined the Owen faculty in 1986 and has since been widely published on a range of financial issues. His interests and current research topics include stock and futures markets, margin adequacy, corporate earnings management, corporate financial policy, executive compensation, selective disclosure, and herd behavior by equity analysts.

“This is a great opportunity for Craig, a highly respected professor and researcher here at Vanderbilt who’s deeply admired by his students,” says Jim Bradford, Dean of the Owen School. “His appointment as Chief Economist at the SEC exemplifies a long tradition of high-caliber, real-world work that has earned the finance faculty here a place of prestige among business schools.”

Risk Fin, created by the SEC in September 2009 to help identify market risks and trends in the wake of the financial crisis, was the SEC’s first new division in 37 years. It provides sophisticated, interdisciplinary analysis across the entire spectrum of SEC activities, including policymaking, rulemaking, enforcement and examinations. In addition to this role as an agency think tank, Risk Fin was created to help break down silos that compartmentalized the SEC’s institutional expertise.

Lewis’ position with the SEC is a two-year appointment. He is currently on a leave of absence from Vanderbilt.

A team of students from the Owen School placed third in an inaugural health service case competition held at Northwestern University April 29–30. The 2011 Health Service Case Competition was the first of what the recently formed Business School Alliance for Health Care Management intends to become an annual event. Sponsored by DaVita, a leading provider of kidney care in the U.S., teams of three students each developed strategies to take on a real-world business case related to health care management.

Vanderbilt’s team included Dr. Jennifer Rymer, BS’05, MBA’11, MD’11; Avery Fisher, MBA’11; and Jonathan Cook, an MBA candidate for 2012. The team received a $1,000 award for finishing third behind the University of California, Berkeley, and Northwestern University.