The Entrepreneurial Spirit of Sloan
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Transcript of The Entrepreneurial Spirit of Sloan
April 2003 Vol. 5 No. 1
http:// mits loan.mit .edu
Periodic statements from the
MIT Sloan School of Management
The Entrepreneurial Spirit of Sloan
Inside the E-Center: Ideas into action
Forbes Entreprenuer of the Year: Jim Foster, SF ’85
r o i
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http://mitsloan.mit.edu/roi
Publisher: MIT Sloan Communications
Editor: Michelle M. Choate, Codirector of Communication
Contributors: Linda Jenkins, Riverside Communications;
Phil Primack; Michael Perrone
Photographer: Mark Ostow
Printing: Quebecor World Eusey Press
MIT Sloan ROI, your Return on Investment in MIT Sloan, is a news
publication for the alumni, faculty, students, staff, corporate partners,
and friends of the MIT Sloan School of Management.
Send address changes and correspondence to MIT Sloan ROI, MIT Sloan
School of Management, Office of Communication, E60-176,
77 Massachusetts Avenue, Cambridge, Massachusetts 02139. Telephone
617-253-7750; fax 617-258-6796; e-mail [email protected].
Copyright ©2002 Printed on 100% post-consumer waste paper
roi Periodic statements from the MIT Sloan School of Management
C O N T E N T S
A Message from Dean Schmalensee
The Spirit of MIT Sloan
The MIT Entrepreneurship Center
Where management science, engineering,
and technology intersect
The Year of the Mouse
Sloan Fellow Jim Foster named
Entrepreneur of the Year
Briefs
Faculty lauded, Tech Treks, Reunion update
Disclosure
Quotable profs, January Tech Treks,
curriculum redesign
Research
Faculty research in the news
Philanthropy
Inventing the future at MIT Sloan
O N T H E C O V E R :
The Global E-Lab team presents their final report to
Professor Simon Johnson (second from right). The
team’s internship at NTT DoCoMo was organized by
Ken Morse and Koyi Sasaki under the sponsorship of
DoCoMo’s CEO Keiji Tachikawa, SF ’79.
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IBC
S L O A N ’ S M I S S I O N
The mission of the MIT Sloan School of Management is to
develop principled, innovative leaders who improve the world and
to generate ideas that advance management practice.
T O A C C O M P L I S H T H I S , W E
> Offer premier programs for shaping leaders who will create,
redefine, and build cutting-edge products, services, markets,
and organizations;
> Col laborate across MIT to capital ize on and contr ibute
to the Institute’s distinctive intel lectual excellence and
entrepreneurial culture;
> Attract, develop, and retain outstanding faculty and staff who lead
the world in management education and research;
> Enroll students with integrity, strong leadership potential, high
aspirations, and exceptional intellectual ability; and
> Foster a cooperative and adventurous learning community that
includes alumni and business partners, works on important
problems, and is based on mutual respect, rigorous analysis, and
high ethical standards.
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> T H E S P I R I T O F M I T S L O A N
A M E S S A G E F R O M D E A N S C H M A L E N S E E
As you will see from the masthead on the page opposite this
letter, MIT Sloan has a new mission statement. With the active
involvement of the Sloan community, we have created what
we believe is a mission that better expresses our identity and
our aspirations: to develop principled, innovative leaders who
improve the world and to generate ideas that advance
management practice.
Throughout this process, it has been reaffirmed — once
again — how strong this community is and how much talent it
contains. With this kind of foundation, I have no doubt that
our aspirations will soon become accomplishments.
As we head into this new year, armed with our new
mission, we cannot help but reflect back with pride on the
wonderful 50th Anniversary celebration of 2002. The
unprecedented gathering of faculty and alumni to exchange
ideas is a source of great pride for all involved. But far from
basking in the glow on this monumental occasion, we are
spurred on by the spirit of the past to keep creating the future
of Sloan.
Critical to that future are several initiatives. A redesigned
MBA curriculum will focus more sharply on developing
leaders who can drive successful innovation — as well as
manage day-to-day execution — and other programs are also
being enhanced and aligned with the new mission. The new
Sloan/SHASS complex — a technological marvel featuring
state-of-the-art internal networks, study and team rooms, and
a multimedia library — will help attract and bring together the
brightest faculty and staff in an atmosphere that encourages
collaboration and innovation. This new complex will play a
part in building on our invaluable links to the rest of MIT, a
hot-bed of technology-based innovation and entrepreneurial
activity. It will also permit continuing expansion of Sloan
executive education, which will enhance our direct impact on
the practice of management.
Fostering innovation is — and always has been — a
critical part of Sloan. And nowhere do we see innovation in
action more than at the MIT Entrepreneurship Center. Here is
where the spirit of MIT Sloan really shines, where ideas
become entities, and the people with those ideas learn to
implement them in the real world. In this issue of ROI, we take
a look inside this thriving center, and at the people who make
it tick.
What happens to Sloan’s would-be entrepreneurs once
they graduate? They implement the principles they’ve learned
to drive change and lead their companies in a competitive
global marketplace. And if they’re Jim Foster, SF ’85, they get
named Entrepreneur of the Year by Forbes magazine (see story
page 8). Congratulations, Jim.
In a world increasingly filled with unpredictable political
and economic developments, it is comforting to note that after
50 years, the spirit of Sloan has remained true to the vision of
its founding. The changes we embrace and encourage are
those we believe will make Sloan, and the world its graduates
enter into, a better place.
I encourage you to stay connected to Sloan, via ROI, the
web site, and our Alumni Relations Office. Over the coming
months there will be many other exciting developments to
share, including a redesign of the overall School web site, as
well as updates on the new building complex. This an exciting
time for Sloan, and we want you to share in the excitement.
Sincerely,
Richard Schmalensee
John C Head III Dean
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Where management science, engineering, and technology intersect
“ E I G H T Y P E R C E N T O F A L L C O M P A N I E S
S T A R T E D B Y E N G I N E E R S W I T H O U T A
B U S I N E S S P E R S O N O N T H E T E A M F A I L
— W H I L E 8 0 % O F M I T F I R M S S T A R T E D
W I T H A B U S I N E S S P E R S O N O N T H E
T E A M S U C C E E D . T H A T K E Y D I F F E R E N C E
I S V E R Y S I G N I F I C A N T . ”
T H E M I T E N T R E P R E N E U R S H I P C E N T E R —
Í
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That’s Ken Morse speaking, managing director of the MIT
Entrepreneurship Center, and one of the true believers in the Center’s
mission: to train the men and women who will make high-tech start-up
companies successful. According to Edward Roberts, David Sarnoff
Professor of Management of Technology and chairman of the MIT
Entrepreneurship Center, “The MIT Entrepreneurship Center began to
take off in 1996 when we recruited Ken Morse, a successful serial
entrepreneur, to be the managing director.”
Morse himself has helped to start six companies, including 3Com
Corporation and Aspen Technology, Inc. And it was Morse’s father,
Richard Morse, founder of National Research Company — inventor of
freeze-dried coffee and Minute Maid frozen orange juice — who
brought the first entrepreneurship course (#15-390 New Enterprises) to
MIT in 1961. That foundation course has been taught continuously at
MIT ever since. So entrepreneurship is in his blood.
When Morse and Roberts began to develop a long-term plan for
the E-Center, they had four goals in mind:
> To recruit ten tenure-track faculty
> To recruit 10 entrepreneur practitioners
> To raise a $60 million endowment to support the new
programs, and
> To build a global network of like-minded entrepre-
neurship centers in high-tech hot spots.
They are making steady progress towards those goals. The E-
Center’s staff and faculty now number 29, with senior lecturers plucked
right out of the business world: Noubar Afeyan, PhD ‘87, Senior
Managing Director and CEO of Flagship Ventures; Howard Anderson,
founder of the Yankee Group, Battery Ventures, and YankeeTek
Ventures; William Aulet, cofounder and former President of Cambridge
Decision Dynamics; Shari Loessberg, cofounder of Zeta Networks; and
Ken Zolot, Visiting Entrepreneur and cofounder of Egenera, Inc.
An MBA track since 1996 (New Product and Venture
Development), “entrepreneurship” at MIT has grown from two courses
to twenty, and from serving 250 students a year to 1500, reaching out
Senior faculty involved in the E-Center — such
as Chairman Ed Roberts (above) and Assistant
Director Simon Johnson (below), along with
Rick Locke and David Scharfstein (not shown) —
are critical to the Center's success and its
impact on the business world.
e4
to MBA students and engineering/science students alike. As an Institute-
wide initiative, the E-Center attracts students from management
science, technology, and engineering.
The new gathering place of choice
Morse stresses that the MIT Entrepreneurship Center is for the whole
MIT community — that it’s not just a Sloan thing. “That’s one of the
reasons we’re in E40,” he says. “To my knowledge, it’s the only MIT
building that has both engineering and Sloan programs housed
together. That’s symbolic of what we’re trying to do with high-tech
entrepreneurship here: It’s the interface between management science,
technology, and engineering.”
The new E-Center offices provide space for the student-run
organizations that are a great source of energy and vitality for the
entrepreneurial spirit at the Institute, including the $50K
Entrepreneurship Competition and the MIT Venture Capital Club which,
among its other activities, hosts the best-known annual venture
capital event on the East Coast each December. There will also be the
new Richard J. Testa Memorial Conference Room (see sidebar), which,
according to Morse, “will very likely become the meeting place of
choice for entrepreneurially minded students from all parts of campus.”
World-class venture capital library
The E-Center will be home to the most complete set of works in the
world about the early days of the venture capital industry. The library
includes the Stan Pratt Venture Capital Library, the Dan Holland, ME
’58, Collection, and the General Georges Doriot Collection, which is on
long-term loan from the French Library and Cultural Center of Boston.
General Georges Doriot, who is known as "the father of the
venture capital industry,” formed American Research & Development
Corp. (ARD) in 1946 at the request of Karl Taylor Compton, then
president of MIT, with MIT and Harvard Business School as investors.
Dan Holland was one of ARD’s first employees, and kept copious notes
and documents from ARD’s early years. ARD made a number of
successful start-up investments, including High Voltage Engineering
and a $70,000 investment in Digital Equipment Corp. The Pratt Library
documents the growth of the venture capital industry since the 1960s,
and analyzes the development of the US venture capital market and its
institutions over the last 25 years. Taken together, these
comprehensive collections are invaluable resources for students of
venture capital.
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E N T R E P R E N E U R S H I P T O D A Y
When asked how being an entrepreneur today
differs from being an entrepreneur 10 or 20
years ago, Morse’s answer was immediate.
“Being an entrepreneur today is the same as it
always was, except for the brief bubble period
in 1999-2000, which we will never see again in
our lifetime.”
He says it takes four basic traits to be a
successful entrepreneur: integrity, passion,
persistence, and commitment to customer
satisfaction. He puts money at the bottom of
the list. “Sure, money is an important measure
of success and it provides the ability to sustain
and grow the enterprise. But, in most successful
companies, making money is seen as a measure
of productivity and not as an end in itself.
Those companies that were founded just
to make money or were born to flip…
mostly flopped.”
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The entrepreneurial challenge
The challenging thing about being an entrepreneur is that you need to
be good at many things. Most academic institutions require that you
be excellent at a few things. But MIT is one of the few universities that
really understands what a true interdisciplinary institution looks like.
To generalize, some schools teach entrepreneurship entirely by
academics; others teach entrepreneurship by practitioners — but MIT
optimizes by using both.
“We have practitioners who are leveraging their vast experience
as entrepreneurs and company builders; they bring their knowledge
and relationships into the classroom, and the students love that,” says
Morse. “Our discipline-based faculty is doing research in the area
which, over the long term, is very complementary. This is, after all, a
research-based institution.”
Exposure to the best & brightest
Students have many opportunities for broad exposure to global
markets at the E-Center and can get first-hand experience through the
Entrepreneurship Lab and Global E-Lab courses. Over the years, more
than 350 start-up companies have offered internships to MIT’s E-Lab
and G-Lab students. For aspiring entrepreneurs, corporate venture
Can entrepreneurship be taught? Yes!
Unlike a few industry pundits, Morse definitely believes that
entrepreneurship can be taught, a vision that goes hand-in-hand with
the MIT Sloan School’s new mission: To develop principled, innovative
leaders who improve the world and to generate ideas that advance
management practice.
“The MIT Entrepreneurship Center supports the Dean’s mission in
the following ways,” explains Morse. “First of all, it takes a spark to
make innovation happen. That spark is usually an entrepreneur.
Secondly, if innovation can be taught, so can entrepreneurship. A vast
number of students come to MIT not imagining themselves as
entrepreneurs, but they leave here knowing that it’s possible. Thirdly,
most of the key donors who are working to make our new campus a
reality are themselves successful entrepreneurs.”
The E-Center encourages researchers and inventors to take their
ideas and technologies way beyond the ivory tower. It puts students in
close proximity to real-world practitioners and faculty who can instruct
them in sales and marketing, teamwork, networking tactics, research,
building credibility, managing intellectual property, and venture
financing. Just as Babe Ruth could learn from his batting coach, so can
budding entrepreneurs be mentored by those who came before.
Each year the E-Center team (l to r: Patricia
Fuligini, Melanie Etchison, Ken Morse, Audrey
Dobek-Bell, and Gracie Alcid) organizes and
supports dozens of events in several countries.
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According to Ken Morse, it takes four basic traits to be
an entrepreneur: integrity, passion, persistence, and
commitment to customer satisfaction.
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officers and regional developers, the E-Center offers an intensive one-
week Entrepreneurship Development Program on campus every January
to help participants develop successful new ventures and increase
entrepreneurial opportunities in their home organizations.
Three of the newest stars at the MIT Entrepreneurship Center
now are M. Diane Burton, assistant professor of Management of
Technology, Innovation, and Entrepreneurship (MTIE), who came from
Harvard Business School; Fiona Murray, also assistant professor of
MTIE, who came from Oxford University; and Antoinette Schoar,
assistant professor of Finance, who came from the University of
Chicago. Morse believes there is no other entrepreneurship center with
as many highly qualified up-and-coming professors.
The E-Center, post-bubble
While the desire, interest, and passion for entrepreneurship has ebbed
at many schools in the wake of the “post dotbomb bubble,” it has
persisted at MIT. One reason is that MIT’s brand of entrepreneurship is
more serious, longer term, and is not as affected by superficial trends.
In Morse’s words, “Very few of our rigorous-thinking engineers and
analytical MBAs were seduced by the siren songs of market dis-
intermediation. It didn’t make sense to them; they were surprisingly
sage during the ‘crazy’ period.”
One interesting note is that there’s a new kind of student at MIT
these days: the survivors of the bubble, who know that it takes more
than a line of bull and a PowerPoint presentation to build a serious
business. According to Morse, many of those who are coming back for
MBAs want to learn how to master technology and use it as a source
of sustainable competitive advantage their next time out.
There’s so much going on at the MIT Entrepreneurship Center
that it’s impossible to keep up with it in print. Visit the web site
(http://entrepreneurship.mit.edu), visit the new space, and get in touch
with the E-Center ([email protected] ) if you have ideas or projects or
funding to contribute. The E-Center has created a thriving network of
academic, government, and industry leaders dedicated to expanding
the vision of entrepreneurial success. You’ll want to be a part of it.
T H E L E G A C Y O F R I C H A R D T E S T A
The new MIT Entrepreneurship Center offices
will house the Richard J. Testa Memorial
Conference Room, a tribute to one of the
preeminent professionals in the world of
venture capital. Dick Testa was the consigliere
of the New England venture industry. Venture
capitalists, limited partners, and entrepreneurs
around the world sought his advice, counsel,
and blessing. He and his firm, Testa, Hurwitz &
Thibeault, LLP, set the standards of honor,
relationships, performance, and continuity that
are the hallmarks of the MIT Sloan new venture
creation community. He was the heart and soul
of the famous Route 128 Venture Support
System from the early days of ARD until his
untimely passing in 2002.
Thanks to Testa’s extraordinary efforts,
the three best libraries documenting the early
years of the venture capital industry will be
located at the new site, adjacent to the
conference room. As chairman and cofounder of
Testa, Hurwitz & Thibeault, Testa was a man of
few words and great vision, who altered and
deeply affected the business and personal lives
of many people in the private equity and high-
technology industries. When he started his law
firm in 1973, he stood at the threshold of
the high-tech and venture capital revolution
and never blinked. His status as a true pioneer
in the VC and technology communities is
well deserved.
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8
According to the Chinese calendar, 2002 was the Year of the Horse.
But for James C. Foster, SF ‘85, it was definitely the Year of the Mouse.
In October, Charles River Laboratories’ Chairman and CEO Foster was
named “Entrepreneur of the Year” by Forbes Magazine. Forbes’ annual
“Best 200 Small Companies” issue ranks the nation’s top 200 publicly
traded companies with annual sales of less than $600 million.
the yearof the mouseS L O A N F E L L O W J I M F O S T E R N A M E D E N T R E P R E N E U R O F T H E Y E A R
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“perfect” for him at that time of his life. Foster, not wanting a
traditional MBA degree, never even flirted with other schools. He knew
what the Sloan Fellows program had to offer and went after it.
Trial by fire
Upon returning to Charles River, life was less than perfect for Foster.
Chalk it up to cultural clashes and new industry uncertainties, but
Foster was put through the wringer by B&L management and had to
prove that he was more than just the “heir apparent” to lead the
division. He came close to leaving once, but decided to learn what he
could from the experience. And that’s what created the impetus to get
the company back.
“It was a struggle,” recalls Foster, “Biotech is still a struggle
20 years later. It was a new industry, and it was very hard to call
the market trends right or to project sales, plus it was one of my
first experiences as a general manager. And the guy running the
show at B&L wanted to see what I was made of. The good news is
that I learned a lot from him about short-term and long-term
strategic planning.”
He also learned a lot about what not to do, in terms of cultural
practices, and about how to treat people. He learned how to step up to
difficult situations when the business wasn’t performing well or the
people weren’t performing well. And he learned how to acknowledge
people’s contributions and maximize productivity by treating people
well and making them a part of the solution.
From 1998 until June 2000, Foster undertook a management-led
buy-out from B&L, and then an IPO. With a program of strategic
acquisitions and technology partnerships, Charles River is building on
its foundation of excellence and innovation in the laboratory animal
industry, offering a wide variety of products and services to help
customers in their drug discovery and development needs.
Today, Charles River is more than a family business — it has a
family feel. According to Foster, hundreds of employees have been with
the firm for nearly 30 years. “That’s the best kind of family business,”
he exclaims. “When it’s no longer a job, it’s a life.”
But why mice? Because for more than 50 years, Charles River
Laboratories has been the global market leader in the commercial
production and supply of animal research models for use in the
discovery, development, and testing of new pharmaceuticals. Foster has
thousands of rats and mice in his facilities in Wilmington, Mass., their
“room and board” paid for by pharmaceutical and biotechnology
companies who are researching genes and drugs. The company operates
77 facilities in 15 countries and maintains more than 130 genetically
and microbiologically defined animal research models around the world.
Charles River was founded in 1947 by Foster’s veterinarian father,
Dr. Henry Foster, to provide rodents to drug companies and academic
labs. Fast breeders, and with genetic make-up that is very similar to
that of humans (a mouse shares 96% of its DNA with humans), these
mammals are invaluable for preclinical research. But the story of
Charles River is not just about innovation in the animal laboratory
industry. It is about how the son of the founder took control of a
family-founded company back from a giant corporation and reshaped it
in his own image.
Stepping out of the world
Foster, who holds a law degree from Boston University, joined the
company in 1976 as General Counsel. In 1984, he worked on the
transaction with his father to sell the then-public company to Bausch &
Lomb (B&L) for $110 million. Father and son went to work for B&L,
father to continue to run the animal production business, and son to
operate the newly established biotech division. It was right before this
that, wanting to strengthen his business background and capabilities,
Foster came to the Sloan Fellows program.
Says Foster, “It was an amazing luxury to sort of step out of the
world and weigh my options: Whether to go back to the company, or
leave the company, or go back in a different role. Sloan absolutely made
that decision crystal clear.”
Foster recalls the Sloan Fellows program as one of the great
experiences of his life. “It’s not just an education; it’s a life-altering
experience,” he says. “You make life-long friends, and you really need
the support system to get through it because it’s very rigorous. It’s a
major bonding experience.” The relationships with faculty and fellow
students, the CEO seminars, and the trips to New York, Washington, DC
and abroad made the program a totally unique experience that he calls
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F O S T E R ’ S F U N D A M E N T A L S
Jim Foster has a lot to say on a lot of meaty topics.
Here’s what he says about three areas that have had a
place in his career — family businesses, entrepren-
eurship, and dealing with difficult business situations.
> Family businesses: My advice is don’t do it.
Businesses and relationships between people in business
are complicated enough. But if you do do it, come in
with some expertise that the company doesn’t have and
know that you’re going to have to work twice as hard as
everybody else and still not necessarily be accepted or
rewarded. It’s definitely paddling upstream. In the end,
life is too short. Do you know what happens when you
go home for family events? You go in the back room
and you talk about business. You don’t talk about, well,
‘How’s life, son? How’s the marriage, how are the kids?
How’s life with you, Dad?’ You miss all that.
> Entrepreneurship: I’m not sure it’s something
that can be taught. I think people either have the spirit
of commitment to be able to see something through or
they don’t. And a lot of people who are natural
entrepreneurs either don’t see the obstacles or don’t pay
attention to them. Most people know whether they’re
that kind of person or not.
> Finding your way out of difficult business
situations: Assume that you will find yourself in a
difficult situation some time, no matter how good
things are going — and prepare for it. You need a
contingency plan, both financially and organizationally.
And I think the most important thing — which is
actually not obvious — is that if you build a culture of
acknowledgement and trust and teamwork, as opposed
to a culture where you beat people up to get results,
when things get tough, people will pull together.
So if you’re one of those people who barks or
takes people for granted or is the type of person who
says, ‘I never have to be nice to you as long as I pay you
well’ — the minute things get tough, people will
abandon you. Guaranteed. So it’s really pretty basic.
And not everyone can do it. To be successful in business
you have to attract and motivate great people and not
say ‘That’s good enough.’ Don’t settle, and you can be
better than 90% of the companies out there. That’s just
a fact. It really isn’t all that difficult.
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Full circle
Along with the quality of the friendships that he made, Foster’s
favorite part of the Sloan Fellows program was the CEO Seminar Series,
where CEOs of major corporations come to class to tell it like it really
is. It was here that he saw up close and personal that there are many
different leadership styles that work, and where he shaped a style that
allowed him to be himself. He calls his experience coming back to
Sloan to lead a CEO Seminar during Thanksgiving week “surreal — a
much better day and night than I ever imagined.”
Sloan taught him that to be successful in running a business you
have to take balanced risks and create an environment in which people
are given incentives to be risk-takers. “You want to be constantly
soliciting people’s input,” he explains. “To say, ‘What do you think?’
‘Why don’t you go out and try that?’ And if it doesn’t work, you have to
be able to say, ‘Thanks for trying.’”
Fostering the entrepreneurial spirit
Under Foster’s leadership, Charles River has developed a uniquely
powerful culture, which is a combination of longevity and
environment, where people are encouraged to take risks, and where
“there’s no such thing as autopilot.” Foster describes his brand of
entrepreneurship in an ongoing business — which he says is different
from creating something from scratch — as being about unwavering
commitment to the vision and the venture, to “working your tail off to
make it happen and to try never to compromise in terms of quality.”
“Everything is about people,” Foster says. “You hire the best
people you possibly can and you provide an environment that’s
stimulating and challenging and you listen to their career goals and
you try to match their aspirations with opportunities in the company.
Then you get happy campers.”
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Jim Foster, SF ’85, at the helm of Charles River
Laboratories, which was founded by his father, Dr.
Henry Foster, in 1947.
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B R I E F S
Faculty Honors
Roberto Fernandez was honored with the annual Distinguished
Article Award by Cornell University’s Center for the Study of
Inequality. The selection committee unanimously approved his
paper, “Skill-Biased Technological Change and Wage
Inequality: Evidence from a Plant Retooling.” Kristin Forbes
was named by the World Economic Forum as one of the 100
young leaders to participate in the Global Leaders for
Tomorrow (GLT) Programme 2003. The GLTs are invited to
participate for three consecutive years in a special GLT
program at the Annual Meeting of the World Economic Forum
and for five years in the yearly GLT Summit and regional
activities of the World Economic Forum. Ed Schein received
the Marion Gislason Award for Leadership in Executive
Development from the Boston University School of
Management Executive Development Roundtable. Arnold
Barnett was awarded the President’s Citation from the Flight
Safety Foundation. He is the first active academic ever to
receive this award.
Fanning the globe
MBAs fanned out around the world on their annual treks to
investigate job opportunities in various sectors. Treks this year
took students to California, Asia, and the largest one right here
in Greater Boston. These treks continue to be a valuable way
for students to not only assess the industry and economic
climate of various areas, but also to network with local alums.
Mission control
Through a process involving much community feedback and
involvement, MIT Sloan has produced a new mission
statement. The new statement better expresses the School’s
identity and aspirations. It focuses attention towards
innovation, leadership, collaboration, globalization, integrity,
and academic excellence. The new mission statement can
be found printed in full on the inside front cover of
this publication.
> F A C U L T Y L A U D E D , T E C H T R E K S , R E U N I O N U P D A T E
! R E U N I O N 2 0 0 3
save the dateAre you in one of theses classes:
1953, 1958, 1963, 1968, 1973, 1978, 1983,
1988, 1993, 1998 and 2002?
If so, it’s your Reunion year!
M I T S L O A N R E U N I O N W E E K E N D
J U N E 6 - 8 , 2 0 0 3
We have lots of great things planned for Reunion
2003! The Reunion Class committees have been
working hard planning class events and raising
class gifts.
Activities will include:
> Career Workshop: When the Going gets Tough…
> Playing the Back Nine: Positioning Ourselves
for Fulfillment in Our Later Years
> Reunion Consumption Function
> Networking Breakfast
> Back to the Classroom, “Innovation at Sloan:
What’s New, What’s Next — Now What?”
> Dean’s Luncheon
> Class Dinners
> Sloan Family BBQ
Find all the Reunion details and register online at
http://mitsloan/mit.edu/alum/reunion2003/.
See you in June!
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D I S C L O S U R E
> Q U O T A B L E P R O F S , J A N U A R Y T E C H T R E K S , C U R R I C U L U M R E D E S I G N
Tech Treks
Much publicity was generated by the MIT Sloan Tech Treks.
The media wanted to know what students were finding at
companies as an indicator of whether an economic recovery is
imminent. Results depended on where the students were. In
Silicon Valley, there were many interviews on television,
radio, and in print. Students were interviewed on CNET radio,
KCBS-AM, and KGO-AM. San Francisco's KRON-TV, KTSF
News and San Jose station KICU followed groups on their
visits to high-tech firms throughout Northern California.
KFTY-TV, a station north of the city, covered the Sloan visit
to wine country.
Students shine
A story titled “If they can’t get jobs, there’s summer stock”
appeared in the New York Times. The story glimpses at a new,
theatrical approach to learning the human side of
management being explored at MIT Sloan. MBAs in the
Global E-Lab class visited Nepal in January along with MIT
water project organizers. Their story was covered in the
Boston Globe.
Curriculum redesign
The Financial Times recently did a story regarding MIT
Sloan’s current curriculum redesign. In the story, Dean
Richard Schmalensee and Deputy Dean Gabriel Bitran
discussed the School’s renewed emphasis on not just
leadership, but producing leaders with a social conscience.
Faculty, student, and alumni participation have all played a
key role in developing a curriculum that balances both
classroom and experiential learning.
Profs proffer
Franco Modigliani was quoted in the Boston Globe regarding
President Bush’s proposed tax plan. Dean Schmalensee talked
about the economy and business ethics on CBS Marketwatch.
The Wall Street Journal recently noted Joseph Doyle's work on
health insurance. Erik Brynjolfsson discussed IT funding in a
Computer World article titled “Why ROI is Important,” and
Amar Gupta's work on electronic check processing appeared in
the Washington Post.
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Using data collected in Wisconsin, Doyle controlled for
age, accident severity and other factors, including seat belt
use. “Comparisons to patients who do not have automobile
insurance [but do have health insurance] and those receiving
Medicaid suggest that health insurance status is driving the
results, not underlying differences in income, attitudes toward
risk, or health status,” according to the study.
While doctors and other providers generally insist that
insurance status has no bearing on the quality or quantity of
care delivered, Doyle’s study indicates otherwise. “In fact, it
appears that one of the first pieces of information discovered
[about people coming into emergency rooms] is insurance
status,” he said.
Doyle, a labor economist who studies health and child
welfare issues, said his research has major implications for
health care policy. “Because car crashes are the leading cause
of death for people under 35, these issues are exactly the kind
of thing we should be thinking about.”
With this week’s government report that health care
costs rose by nearly nine percent from 2000 to 2001, Doyle’s
research is also significant to health care providers. If
automobile accident victims at least carried catastrophic
coverage – which costs about $300 a year in Wisconsin,
according to Doyle – emergency rooms would receive at least
some reimbursement for treating car accident victims and
might thus be more likely to provide more of the advanced
care given to people with full insurance coverage.
“If people knew that the emergency room safety net is
really not there as much as they think it is, they might go for
at least catastrophic insurance,” said Doyle.
Health insurance status has significant effect
on treatment decisions and patient outcome
Professor Joseph J. Doyle, Jr.
Automobile accident victims who lack health insurance receive
20 percent less treatment in hospitals and are 37 percent more
likely to die of their injuries than victims with health coverage,
according to new research by MIT Sloan Professor Joseph J.
Doyle, Jr.
“Insurance status has a significant effect on treatment
decisions and ultimately patient outcomes,” concluded the
study by Doyle, who based his findings on a unique data set
that links police accident reports with hospital records.
“A lot of studies show that the uninsured get less care,
but that may be because they are less likely to go to doctors in
the first place or because of other factors,” Doyle said. “For my
study, I picked a case — car accidents —where people have no
choice about seeking medical care. Beyond the amount of care
received, we also looked at health outcomes and found higher
mortality for the uninsured. Emergency rooms are not as much
of a safety net as people think. The uninsured still get a lot of
care, but are less likely to receive the expensive critical
treatments that can save lives.”
R E S E A R C H
> F A C U L T Y R E S E A R C H N E W S F E A T U R E S
15
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identification with a particular character often prevents
typecast actors from being considered for other roles.”
While some actors have been able to break out of initial
character identities — Robin Williams and Jim Carrey, for
example — others, such as Sylvester Stallone, have proved far
less able to expand beyond their original character molds.
And if stars with such big names and box office revenues find
it hard to break the type cast, the burden is even greater on
entry-level actors. Indeed, Zuckerman found that fewer than
one third of the actors who actually get a film credit for a role
will find any further film work over the next three years.
Zuckerman said his research carries labor market
implications beyond Hollywood and the film industry.
“There’s a tendency in the media and among academics to
look at what’s called the boundaryless career replacing the old
image of the organization man moving up the hierarchy,” he
said. “And it’s true that there can be greater opportunity for
the individual to craft something unique and get more variety
in their careers by moving from engagement to engagement.
But what is underemphasized is that hiring tends to be very
category — and skill-specific.” And job applicants unable to
demonstrate that they have the skills to fill such categories
can have a hard time.
Ironically, Zuckerman said, young workers and others
may have a greater chance to take on new jobs and functions
within a particular organization than within the labor market
at large. That’s because an individual employer may be more
willing to take a chance on a worker who has already proven
her ability to do a job well than on an unknown. In other
words, the bit part can lead to a better part within an
organization. “A great example of this is GE’s practice of
moving managers across industries — something that is very
hard to do on the outside,” he said.
“People have a preconception that the overall market
provides greater opportunities (for workers) than
organizations. Our paper suggests that this isn’t necessarily
the case,” said Zuckerman.
Typecasting limits career growth,
but can also bring benefits
Professor Ezra Zuckerman
Employees may believe that moving from job to job helps
prevent placement in narrow career pigeon holes, but an MIT
Sloan School professor’s study of the film industry — where
the word “typecasting” was born — finds that the practice can
actually offer real advantages. Niche players, it turned out,
often do better than generalists in the labor market.
“If you read People magazine or Entertainment Weekly,
typecasting is presented in a generally pejorative way,” said
Professor Ezra Zuckerman, who teaches strategic management
at Sloan. “It’s seen as a barrier to the full expression of an
actor’s skills. But in reality, typecasting is a boon for the vast
majority of those who make a go of it in Hollywood.”
The overwhelming majority of acting aspirants never get
their names on the big screen in any kind of role, Zuckerman
said. But of those who do, being cast in a certain type or
role helps them to maintain their precarious foothold in
the industry.
“Typecasting provides a route into the industry by
conferring the minimum level of recognition necessary to
continue to obtain work, even if this recognition involves the
adoption of a generic identity,” the study said. “The
advantages of typecasting consist largely in the foothold that
it provides to aspiring actors by giving them a viable, if
generic, identity to assume. The main drawback is that the
> F A C U L T Y R E S E A R C H N E W S F E A T U R E S
16
As the academic year draws to a close, it is a pleasure to thank
MIT Sloan School of Management alumni, whose dedicated
interest and support through the Annual Fund help the School
achieve its mission. Because tuition revenues cover only about
50% of the cost of a Sloan education, your support plays a
critical part in helping MIT Sloan address its most pressing
needs. Unrestricted gifts through the Annual Fund support
our core academic goals and seed new initiatives that help to
keep us at the leading edge of graduate management
education and research.
At its core, innovation always has been central to the MIT
Sloan mission. Sloan alumni go out into the world equipped
with a passion for ideas and problem solving and an ability to
drive change that makes them standouts in the global
marketplace. The cutting-edge research and teachings of Sloan
faculty are the building blocks of tomorrow’s management
theory and practice, and give our students a distinct advantage
over their competition.
Make a difference
Thank you for considering a contribution to the MIT Sloan
Annual Fund. Your support helps us attract the best students
and faculty to sustain our diverse community and to redesign
our core academic programs. And, beyond that, it helps us to
fulfill our mission of developing principled, innovative leaders
who will help improve the world.
> For more information about the Sloan Annual Fund, contact
Lillian Paratore at 617-258-5656 or [email protected].
> For more information about Reunion Class Gifts, contact Brenda
Cross at 617-253-2556 or [email protected].
> For more information about Special Gifts, Campaign Gifts, or
Corporate Giving, contact Margaret Keller at 617-253-3989 or
> For more information about how to get involved with our alumni
activities and programs, visit the Sloan alumni web site at
http://mitsloan.mit.edu/alum/index.html.
P H I L A N T H R O P Y
> I N V E N T I N G T H E F U T U R E A T M I T S L O A N
I N N O V A T I O N
Teamwork & Diversity
“Sloan’s emphasis on teamwork helps me focus
on the important things, like problem solving.
And the exposure I got to students from a variety
of cultures is invaluable to me now in my global
role. One of the biggest innovations is Sloan’s
willingness to be upfront and open about things.
That translates well into day-to-day management
situations, where we can focus on the problems
and not on the personalities. It’s teamwork at the
very highest level and it helps me promote the
right working environment, a real ‘win-win’ for a
multinational company like Bacardi.”
Joaquin Bacardi, MBA ’98
Director, Global Marketing, Bacardi-Martini, Inc.
I N N O V A T I O N
Accessibility & Community
“Fostering an environment of innovation is, in
itself, innovative, and Sloan does this better than
most. Access to professors is amazing; they’re
more than willing to answer questions and work
jointly on projects with students. In fact, many of
the innovations and ideas at Sloan are student-
driven and institution-wide. The MIT Sloan
community is full of brilliant and creative
individuals. The Sloanies I meet are smart, good
people. It’s an honor to be part of this institution
and I’m always very proud when I get a chance
to say it.”
Kirsten Knipp
SM ’03 MBA
I N N O V A T I O N
Creativity & Leadership
“Sloan encourages innovation, and the new
Leadership Program is proof of that. We’ve been
teaching leadership for decades, but now we have
a full program of workshops, a speaker series, an
executive in residence program, and much more.
And Annual Fund dollars have contributed
directly to its development. The students get to
be creative in ways they might never have
imagined at a business school. It’s exciting,
it’s creative, it’s countercultural, and it’s
all individually focused. You can’t get this any
place else.”
Deborah G. Ancona
MIT Sloan Seley Distinguished
Professor of Management
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