Business Administration and Technical Professionals Earn your MBA - - PowerPoint PPT Presentation

Business Administration and Technical Professionals

Earn your MBA in three easy hours

Artie McKim Ph.D MBA Gaylord Chemical Company LLC

The Three Hour Tour

• Introduction (5:00-5:15)
• Why this information may apply to you (5:15-5:30)

First Semester: 5:30-6:00

Statistics + Organizational Behavior

Second Semester: 6:00 - 6:30

Basic Accounting + Marketing Management Negotiations + Ethics + Managing Information Systems

Third Semester: 6:45 - 7:15

Cost Accounting + Macroeconomics Business Law + Finance

Fourth Semester: 7:15 - 7:45

Operations Management + Entrepreneurship Strategic Management

Third Semester: 6:45 - 7:15

Introduction

• Background

– Education – Professional Experience

• Why it made sense to go business school

– Changing needs of employer – Professional development – Personal reasons

Why this information may apply to you

• The value of problem ‘finders’
• Being a technology translator
• Running a technical business unit
• The World is flat! 20a The Cheese is moving!

.

20a.Images shamelessly copied from internet sources.

Organizational Behavior The systematic study of the actions and

attitudes that people exhibit within organizations1c

“ First Semester: 5:30-6:00

1.

• S. Robbins Essentials of Organizational Behavior, 8th ed. (2005)

p.2

• 2. Ibid p3-5

The purpose underlying the study of Organizational behavior is to explain, predict, and control behavior within a group of people within a workforce. Contributing disciplines2 include: Sociology: the study of people in relation to their fellow human beings Psychology: general study of animals and people which tries to measure and explain behavior Political Science: Topics ranging from the study of conflict, influence, and the allocation of power among groups and individuals

Organizational Behavior The topic of Motivation

“ First Semester: 5:30-6:00

• 4. S. Robbins Essentials of Organizational Behavior, 8th ed. (2005) p.

48

• 5. B. Groysberg “How Star Women Build Portable Skills” Harvard

Business Review (February 2008) p 74-81

Motivation: The willingness to do something [which] is conditioned by this action’s ability to satisfy some need of the individual.3 Basic Theories4 include: Maslow’s Hierarchy of needs: Physiological > Safety> Social> Esteem > Self Actualization McGregor’s ‘Theory X and Theory Y’ model: Competitive concepts – the role

• f higher order needs vs lower order needs in motivation

McClelland’s Theory of Needs: Individuals are primarily driven by the need for achievement, power, and affiliation Gender differences: “How Star Women Build Portable Skills”5

Organizational Behavior Practical aspects

“ First Semester: 5:30-6:00

1.

• S. Robbins Essentials of Organizational Behavior, 8th ed. (2005)

p.2

• 2. Ibid p3-5

Consider the role that an understanding of workplace behavior can have in areas such as:

• Interviewing new employees
• “Change Management”
• Designing working arrangements
• Performance appraisals
• Dealing with employee problems – and employee

potential.

Statistics The collection, presentation, analysis and interpretation of

numerical data for the purpose of making more correct decisions 6

• Descriptive Statistics measures of dispersion, central

tendency

• Statistical Inference: finding the whole when only a part is

known Sampling distributions (normal, binomial, Poisson) Linear Regression and Correlation analysis Experimental Design Hypothesis testing

• 6. B. Parl Basic Statistics (1967) p 3

First Semester: 5:30-6:00

Statistics practical aspects

• Quality / Process control control

charts, Statistical process control

• Finance / Risk Management
• Polling / Focus group testing
• Decision Analysis7
• 7. Anderson, Sweeney, Williams Statistics for Business and

Economics (2005) p 893

First Semester: 5:30-6:00

Statistics an example8

Two growers offer you their crops. One grower asks a

slightly higher price than grower B, but he says that his grapefruit are more uniform in size. To check this he sends you a crate of twenty five grapefruit. You measure the grapefruit in each sample and learn:

• The size of the grapefruit is approximately normally distributed for each

sample.

• For grower A, the mean diameter of the fruit is 4.5 in, with standard deviation of

0.5 in

• For grower B the mean diameter of the fruit is 4.5 in, with standard deviation of

1 in.

8.D. Koosis Statistics, a Self-Teaching Guide (1997) p 157

First Semester: 5:30-6:00

Statistics an example

Is the difference in the variances significant at the 5% level? Null hypothesis: σ1 = σ2 Alternative: σ1 ≠ σ2 Perform an F test and compare F value to F critical region: F = σ1 / σ2 = 1 / 0.25 =4 Critical region F > 1.98 Results are significant. The fruit from grower A are more uniform in size.

8.D. Koosis Statistics, a Self-Teaching Guide (1997) p 157

First Semester: 5:30-6:00

Basic Accounting

• Provides an introduction to financial

statements (Balance sheet, statement of cash flows, Income statement, retained earnings statement)

• Discusses management methods for

receivables, inventory, long-lived assets

Second Semester: 6:00 - 6:30

Basic Accounting

Balance sheet

Source: http://www.edgar-online.com

Second Semester: 6:00 - 6:30

Basic Accounting

Income statement

Example Income Statement For the company June 2004 – June 2005 INCOME Sales $1,200 Grants $3,700,000 TOTAL INCOME $3,701,200 EXPENSES Salaries $2,500,000 Rent $700,000 Supplies $1,600,000 Travel $550,000 Advertising $800,000 Utilities $95,000 Salary burden $80,000 TOTAL EXPENSES $6,325,000 PROFIT ($2,623,800) Internet example: http://xnet.rrc.mb.ca/heatherp/example_income_statement.htm

Second Semester: 6:00 - 6:30

Basic Accounting

STATEMENT OF RETAINED EARNINGS for the year ending December 31, 1996 Balance of retained earnings, December 31, 1995 1,050,000 Add: 1996 Net Income 350,000 Less Dividends to stockholders 120,000 Less Loss on Abandoned Operations 100,000 Balance of retained earnings December 31, 1996 1,280,000

Internet reference: http://academic.uofs.edu/faculty/gramborw/tufsa.html

Second Semester: 6:00 - 6:30

Marketing Management

• “Marketing is a social process involving the activities necessary to enable

individuals and organizations to obtain what they need and want through exchanges with others and to develop ongoing exchange relationships”8

• Concepts include:

Understanding buying behavior Advertising concepts Forecasting Market Segmentation The ‘Four Ps” (place, price, promotion, product) “Marketing is too important to leave to the Marketing Department” Peter Drucker

• 8. Mullins, Walker, Boyd, Larreche Marketing Management

(2005) p5

Second Semester: 6:00 - 6:30

Marketing Management Practical Aspects

• How do Marketing concepts apply to the chemical industry?
• Industrial Marketing (as opposed to consumer marketing)23
• Market research
• Managing marketing programs
• 8. Mullins, Walker, Boyd, Larreche Marketing Management (2005)

p5

• 23. J.D. Hlavacek Profitable Top-line Growth for Industrial

Companies (2002)

Second Semester: 6:00 - 6:30

Negotiation

“Intrapersonal decision-making process necessary whenever we cannot achieve

• ur objectives single-handedly”9
• The BATNA concept
• Preparation
• Negotiation style (cooperatives vs. aggressives)
• Practice – with feedback.
• 9. L. Thompson The Heart and Mind of the

Negotiator 3rd ed, (2005) p2 Second Semester: 6:00 - 6:30

Negotiation practical aspects

• Negotiating a job offer!
• Pricing negotiation
• Conflict resolution

Personal insight:

• The ability to creatively seek outcomes offering mutual gain

is a powerful skill.

• Being a good negotiator doesn’t require aggressiveness –

it requires intelligence.

Suggested reading: a) Fisher & Ury Getting to Yes 2nd ed. (1991) b) The Essentials of Negotiation Harvard Business School Press (2005)

Second Semester: 6:00 - 6:30

Ethics Do the ‘right’ thing

There are clearly reasons to be concerned about ethical corporate and personal behavior: 1. Businesses have social obligations, don’t they?14 2. You could make some expensive mistakes (Merck & Co., Hallmark Co). 3. You could get into real trouble (see K. Lay; J. Skilling; A. Fastow et al.) Insight: Ethical behavior can be institutionalized. It isn’t always.

14 Robert Reich Supercapitalism (2007); John Bogle The Battle for the Soul of Capitalism (2006)

Third Semester: 6:45 - 7:15

Managing Information Systems

Topics include:

• strategic impact of IT (Wyndham case)
• data management (Katrina!)
• decision support system design (employee compensation

system)

Third Semester: 6:45 - 7:15

Cost Accounting know your costs

Cost Accounting (Managerial accounting) is largely concerned with providing information for internal use in the company.

Financial accounting User type Cost accounting External users ( creditors, regulators, stockholders) Officers and managers Financial Statements report type Internal reports Following GAAP Report content detailed, specific to business function aggregated, condensed externally audited (CPA) Verification no independent audit Adapted from Weygandt, Kieso, Kimmel Managerial Accounting 3rd Ed. (2005) p. 5.

Third Semester: 6:45 - 7:15

Macroeconomics The holistic study of the economy

• Macroeconomists try to build mathematical models to

explain relationships between variables such as:

– The effect of taxes and government spending – The role that consumption and savings play – Trade relations (net exports / imports) – The relationship that money supply has on productivity – Unemployment – The role that currency exchange rates play – The effects of supply / demand ‘shocks’ – ‘Long run’ vs. ‘short run’ policy decisions

Y = C + I +G +NX

Fourth Semester: 7:15 - 7:45

From Wikipedia “microeconomics”

Macroeconomics

• A Practical example:

Your company competes aggressively against a German company for market share. Both companies produce a catalyst which is sold against a universal specification. As of yesterday, the Euro was trading against the US dollar at a ratio

• f 1.50 : 1.

As a business manager, what kind of opportunities and challenges exist for a) the German company and b) your company in both the US and the European markets?

Fourth Semester: 7:15 - 7:45

Business Law

A basic understanding of legal issues12 is clearly important to technical business people. Consider issues such as:

• An understanding of regulatory affairs
• Torts and Crimes
• Contractual relationships
• Negotiable instruments
• Business Organization (LLC? Corporation? Sole Proprietorship?)
• Consumer Law
• Intellectual Property
• 12. Clarkson, Miller, Jentz, Cross West’s Business Law: Text and Cases. 10th ed. (2006)

Fourth Semester: 7:15 - 7:45

Business Law Intellectual Property

Consider this: You and a coworker have developed a manufacturing process that will allow you to profitably produce a revolutionary new fuel cell. Other research teams are working on similar technology at competitor companies. Protecting the technology: documentation, provisional patenting, Patent

• ptions, the patent process, trade Secrets

Remedies for infringement: Damages, Royalties Nondisclosure protection International protection

Fourth Semester: 7:15 - 7:45

Finance

There are many different types of financial decisions made by corporations, requiring specialized skills and knowledge. Financial managers are faced with these questions as they work to “increase value”13: How should a company spend its money? How should a company raise its money? Aspects: Capital Structure (Debt vs. Equity decisions) Managing Working Capital (current assets and liabilities)

• 13. Brealey, Allen, Myers Principles of Corporate Finance ( 2006) p7

Fourth Semester: 7:15 - 7:45

Finance Making the case for your project

Year 2008 2009 2010 2011 2012 2013 2014 2015 sales 523 12887 32610 48901 35834 19717 COGS 837 7729 19552 29345 21492 11830

• ther costs

4000 2200 1210 1331 1464 1611 1772 tax

• 1400
• 1580

262 3432 5929 4053 1939 682 cash flow from operation

• 2600
• 934

3686 8295 12163 8678 4176

• 682

change in working capital

• 550
• 739
• 1972
• 1629

1307 1581 2002 capital investment + disposal

• 1000

1949 net cash flow

• 12600
• 1484

2947 6323 10534 9985 5757 3269 present value at 20%

• 12600
• 1237

2047 3659 5080 4013 1928 912

net present value

3802

Adapted from Brealy, Myers, Allen Principles of Corporate Finance, (2006) p. 123

Fourth Semester: 7:15 - 7:45

Operations Management

Managing the production of goods and services

On a simple level, a company has finance, operations, and marketing functions. Operations adds value to inputs (land, labor, capital, information, raw materials) and converts them to outputs – goods and services.19 Includes topics such as:

• Quality Control (Six Sigma!)
• Supply Chain Management
• Inventory management and Scheduling (aggregate planning)
• Project Management
• Queuing theory
• 19. W.J. Stevenson Operations Management (2007) p.5

Fourth Semester: 7:15 - 7:45

Entrepreneurship

High points of the class

• Discussions with real-life

LA entrepreneurs

• Writing a business plan
• Entrepreneurial activity at

my company!

Soteria Corporation Business Plan

Could you start your own business? Fourth Semester: 7:15 - 7:45

Insight: Can you teach entrepreneurial abilities?

Strategic Management The General’s view

Strategy: “The central, integrated, externally oriented concept of how a firm will achieve its objectives”20 Focuses on integrating a leader’s understanding of: The Internal Environment (Capabilities? Resources? What’s your Hedgehog concept? 22) The External Environment (What are your competitor up to? Porter’s “Five Forces” model of Industry Structure23

• 20. D.C. Hambrick; J.W. Fredrickson “Are You Sure You Have a

Strategy?”Academy of Management Executive, 15:4 (2001) 48-59

• 21. M.A. Carpenter; W.G. Sanders Strategic Management, A Dynamic

Perspective (2007)

• 22. J. Collins From Good to Great (2001); Built to Last (2005?)
• M. Porter Competitive Strategy: Techniques for Analyzing Industries and

Competitors (1980)

Fourth Semester: 7:15 - 7:45

Strategic Management Case Study

“Home Depot’s strategy under Bob Nardelli”24 History – Rapid expansion under founder Blank Problems: Shareholder values stagnating; customer satisfaction flagging; competition for market share

Strategic options?

• 24. M.A. Carpenter; W.G. Sanders Strategic Management, A Dynamic

Perspective (2007)

Fourth Semester: 7:15 - 7:45

From Wikipedia.org “Robert Nardelli”

International trip!

Any MBA program worth its salt features an international trip. Our class went to China in October of 2006. Purposes for this include:

• Some exposure to other business cultures
• Factory trips
• Seminars with international business people
• Fun!

Advice: If you haven’t already, find a way to see some of the world. You’ll see everything in a different way when you get back.

International trip!

Impressions of China:

• Growth is explosive (Beijing traffic! Shanghai Skyline! Chongqing!)
• A massive change in demography is underway
• Many people are working very hard, for very little – but are excited

about the opportunity

• There is some uncertainty about the social system

Pictures… Insight: I was humbled by how little I actually know about such a large country, with such a rich history.

International trip!

I have been really fortunate to travel on business to many parts of the

• world. Here are some quick impressions:
• India (Mumbai, Hyderabad, Udaipur): The chemical industry is

maturing very quickly (commodity manufacturing  specialty production  discovery). Infrastructure problems

• Taiwan: very entrepreneurial society. High tech manufacturing

capabilities

• Japan: Sophisticated business culture
• Brazil: Becoming a first class pharmaceutical manufacturing location
• South Korea: Microelectronic technology development

International trip!

The EU: The “United States of Europe”? 15

• The Euro has more daily users than the US dollar (p. 65).
• Two of the world’s five richest economies – and four of the top twelve- are EU

members.

• To access the EU market, US companies are increasingly having to conform to

EU regulatory standards16 (REACH initiative, Microsoft, Jack’s downfall)17

• 6% of the world’s total area – 40% of its wealth.18
• 15. T.R. Reid The United States of Europe (2004)
• 16. M. Schapiro Exposed: The Toxic Chemistry of Everyday Products and What’s at Stake for American Power (2007)
• 17. Reid, p105

18 Reid, p245.

What did it cost?

The bottom line: $35,000 (books, international trip included): See if your employer will help (Use your negotiating skills!) About two years: It went by faster than I thought. Lots of miles on the Toyota: tax deductible education expense! Not much free time: What else better did I have to do?

Was it worth it?

• Out of ~30 students in my MBA class, at least three immediately

moved on to better jobs as a result of the experience.

• I’m better at investing my own money these days.
• Formulating and implementing my personal career strategy

On the one hand: On the other hand:

• An MBA is a “Jack of all trades, and a master of none”.
• Much of MBA study (such as case work) is meant to simulate

experience – it cannot replace experience.

• Focused career path?

Credits

Artie McKim Ph.D MBA Technical Director Gaylord Chemical Corporation amckim@gaylordchem.com Craig Alexander Vice President of Marketing Gaylord Chemical Corporation Pat Lovell Vice President of International Business Gaylord Chemical Corporation

• Dr. Alan Marchand

Regents Professor University of North Texas LSU Professors

• Dr. Young Chun

Micheal Blue Barbara Danos, JD

• Dr. Farik Koray

Scott Fargason

• Dr. Nick Apostolou