Canada wins 2011 Global Business Case Competition

GBCC2011April 16, 2011 was an eventful day as the Global Business Case Competition hosted its 13th annual undergraduate case competition.  We were proud to host the entire competition in Foster’s new building and show off our new state-of-the-art home to visiting teams.

Each of the twelve Global Business Case Competition teams presented their analysis on how to make a water purification business in Tanzania profitable and how to expand the business to other African cities.  After a competitive preliminary round, four teams were selected to move on to the final round: University of Washington, Western Ontario University (Canada), Thammasat University (Thailand) and the University of Auckland (New Zealand).

With over 200 people from around the world in attendance, the final round of presentations was exciting to watch. In the end, judges chose University of Western Ontario (Ivey School of Business) as this year’s champion.

Congratulations to Foster School students on the University of Washington team for landing a spot in the final round: Kyle Bartlow, Jessica Henrawidjaja, Venkat Rao, and Melanie.

13 cultural characteristics of great companies

Greg Gottesman, managing director at Madrona Venture Group, spoke to UW Foster School of Business alumni and students about his tips for finding (or leading) a great company or organization.

He blogged about 13 characteristics of a great start-up culture on TechFlash recently and expanded those concepts in a lecture with anecdotes and examples, recommending people consider corporate or start-up culture before taking a job or launching a new venture.

Here are his 13 cultural characteristics of great culture:

  1. No politics – Give credit where credit is due. Be genuine about it.
  2. It’s not a job, it’s a mission – People can work for competitors or jump ship anytime, but companies that foster a culture of a strong mission do best to attract and retain great employees.
  3. Intolerance for mediocrity – Everyone pulls their weight well at all levels; there is excellence in each role and companies repel or naturally weed out those who aren’t comfortable succeeding or excelling.
  4. Watching pennies – Leaders and senior managers treat company assets as carefully and thoughtfully as they would their own personal assets; waste is not tolerated.
  5. Equity driven – Stock options or other non-cash value helps grow businesses for the long term.
  6. Alignment – Everyone is on the same page. Strategy is clear. Like a well-tuned sports team, people all work toward the same goal vs. individual heroism.
  7. Good communication – Even in bad times, communication remains strong; over-communication is even more critical in times of difficulty (i.e., an executive leaves, a key client departs, company is hacked)
  8. Strong leadership – Lead by example and maintain a positive attitude. Leaders boost their own morale and those around them as they set the tone for the whole company.
  9. Mutual respect – Hierarchy may exist, but everyone is respected for their contributions. “Wins” are celebrated together, regardless of title or department.
  10. Customer obsessed – The customer is always the most important asset. Gottesman emphasized this may be the most important characteristic of an organization.
  11. Energy – Good energy permeates across the company and is almost tangible.
  12. Fun – Never underestimate the power of a good start-up that knows how to have fun. Particularly when first in start-up mode, he’s often seen companies that thrive on early-stage activity where employees work hard and play hard.
  13. Integrity – Great companies have an internal sense of doing things the right way. They spend the extra effort to create value that will outlast their own job or time at the company (i.e., documenting code).

Watch video excerpts from Greg Gottesman’s talk on culture.

This lecture is part of the Center for Innovation and Entrepreneurship‘s alumni network events.

Foreign market strategy project

Guest post by Mike Lawrence, Foster BA 2012 and Certificate of International Studies in Business Student Custom/Italian Track

2011 Forign Market StrategyBoeing Market Outlook Report was the focus of 2011 Foreign Market Strategy Project. Certificate of International Studies in Business (CISB) tracks competed in the fourth annual Foreign Market Strategy Project in winter 2011. Made possible by the Boeing Company with CISB alumna Ya-Han Brownlee-Chen as project manager, the project tasked students with examining Boeing’s Current Market Outlook Report and looking for both general and region-specific improvements that could be made to the report. In addition, it challenged students to improve the usefulness of the report to Boeing’s numerous supply chain partners around the world. CISB students had approximately five weeks to complete their research and then present their findings to a panel of judges which included Boeing Company representatives, Associate Dean Steve Sefcik and CISB alumni.

At the suggestion of Ya-Han, a coach from Boeing, Helly Hansen and Samskip IcePak were brought into the tracks to provide an industry perspective and guidance to the teams. Tracks got a lot of help and advice from the coaches. One student said, “Not only was our coach extremely helpful, but she invited us to tour her workplace this spring.”

All of the presentations were a delight to see, with each group bringing unique and often very creative ideas to the table. In the end, there were three awards distributed among the eight presenting groups. The Chinese team (Chinese Track) received the Grand Prize for Best Recommendation, while the Middle East (Custom Track) team received the reward for Best Presentation, and the Europe (German Track) team for Best Teamwork. In all, the project was an excellent experience for CISB students and Boeing alike, with Boeing receiving some quality ideas on how to improve their report.

The Chinese track presented their strategy to senior management and campus recruiters at Boeing on April 8. They also went on a VIP tour of the Everett facility,  met with recruiters at a networking lunch and had the privilege of meeting with Ian Chang, VP, China Operations and Business Development for Boeing Commercial Airplanes.

Have an idea for a future strategy project? If so, please contact CISB at cisb@uw.edu.
Learn more about the Certificate of International Studies in Business.

Marketing failure: iPhone in India

Guest post by Shailendra Jain, associate professor of marketing, UW Foster School of Business

iphoneApple has been called “the most admired company in the world.” There are some good reasons for this. Apple is very innovative, very cool, very personality-oriented.

But while Apple’s iPhone has achieved landmark success in the United States and redefined the smart phone category, it has so far struggled in two of the world’s largest markets. The iPhone has yet to create much interest in India and is, at best, a fledgling brand in China.

It has not met the success in these markets that Apple expected for a variety of reasons.

First is a technology issue. In India, the market I’m most familiar with, the iPhone has compatibility issues. That’s an amazing thing to ignore. Your product has to be aligned with the context in which you are marketing it. Apple, reportedly, is in talks with carriers in China and India to overcome this compatibility issue and is believed to be launching an iPhone with CDMA technology, which is compatible with Chinese and Indian telecom standards. It will be interesting to see whether this enables Apple to capture a larger chunk of these two enormous markets.

Second is a pricing issue. At its introduction, an iPhone cost about the same price in India as it did in the U.S. (about $700). But the way consumers process price information is interesting. In India, many potential customers reasoned that for the price of three iPhones they could buy a Nano car. And they were not sure if this was a good trade off. For these consumers, Apple may have gotten the price wrong. They may have ignored the how people in these countries process price information.

A third reason is that people in India are used to an unlocked phone. Apple does not want people to buy unlocked versions of its phone. But the moment there is a gray market where people can buy another compatible version of the iPhone, Apple will be challenged.

A fourth reason—and this is personal speculation—is a misalignment of “softer” brand attributes. What Apple as a brand means in the U.S. is very different from what Apple means in Asian countries. It was born in the U.S. and has produced a long line of successful “i” gadgets—iMac, iPod, iPad—whose branding is rooted in individuality. This is clever branding, and has been a good fit for an influential segment of the American and Western population: rebels, early adopters, would-be innovators who want cutting-edge technology and are relatively less sensitive to price. In Asian countries this is not such a strong fit, in terms of perceived personality. Asian cultures tend to be more collectivistic, and the theory is that millions of consumers in these cultures may find “i” less appealing than “we.”

For the iPhone, a whole set of factors converge to the same outcome. And I think this is typical of marketing failures. Rarely is it the fault of one or two factors. Usually it’s a complex confluence of multiple factors—product design, pricing, revenue model, distribution, promotion, branding, competition. Underestimating your weaknesses or overestimating your strengths. More often than not, multiple factors feed into most marketing failures.

See 15 Cautionary Tales: Failed Marketing Campaigns for more information.

Marketing failure: New Coke

Guest post by Dan Turner, senior lecturer in marketing, associate dean for masters programs and executive education at the UW Foster School of Business

newcokeNew Coke is—for my money—the most epic new product fail in marketing, more so than the DeLorean, Apple’s Lisa and Newton, Sony’s Betamax, and even the Edsel.

Many people have selective memories about the Coca-Cola Company’s decision to launch the product and the initial consumer reaction. Coke’s market share had been falling for years, and consumers overall expressed a strong preference for Pepsi over Coca-Cola in blind taste tests. The new, improved, sweeter formulation of Coke tested extremely well, with more people preferring the New Coke formula over both “old” Coke and Pepsi.

In a naïve way, it made perfect sense for the Coca-Cola Company to improve their product, making up for a known deficiency versus a focal competitor. In fact, sales analysis trends immediately following the product launch showed significant gains for the Coca-Cola Company. In informal blind taste tests, Seattle retiree Gary Mullins, founder of Old Cola Drinkers of America, failed to distinguish between old and new Coke or expressed a preference for the latter.

Of course, we know the rest of the story. The public revolt ensued shortly thereafter, and it had little to do with the taste of the soda. In launching the new version of Coke, the Coca-Cola Company had a made a fundamental error in forgetting the source of the value it was truly offering consumers.

A soda that tasted good was nice, but Coca-Cola really offered value on the basis of its strong, favorable, and unique brand associations: America, friendship, nostalgia, and the like. In changing the formula, the company walked away from all of these sources of value, and customers reacted strongly, emotionally, and in a predictable fashion.

The silver lining for the Coca-Cola Company rested in the fact that the re-introduced product, Coca-Cola Classic, created a firestorm of marketing communications activity, reminding consumers why Coke was so great in the first place and dramatically communicating the value of the brand.

See 15 Cautionary Tales: Failed Marketing Campaigns for more information.

Marketing win: VW Beetle

Guest post by Elizabeth Stearns, senior lecturer in marketing, UW Foster School of Business

vwbugWhen the Beetle was first introduced in the early 1960s, people would joke that you could go up a hill or you could have heat in a Bug, but you couldn’t do both. It was a quirky car, to put it mildly. Even VW engineers called it a lemon.

But the company positioned the Beetle as a different kind of automobile with a unique personality in a series of funny, brilliant advertisements. It found a target audience that was really interested in expressing their own personality, and they found this car was an extension of who they were. A generation of Beetle drivers reveled in its lack of frills. They didn’t care if you could drive up the hill with the heat on.

Then when the New Beetle was introduced in 1998, decades after the original was retired, the big issue was: how do you guide Baby Boomers down memory lane while also attracting the younger generation, because you need to grow that market and the Beetle is an entry vehicle into the VW line?

Cadillac had tried to attract younger drivers for years and failed because they simply did not want to drive their father’s car. There was the same danger for the reintroduced Beetle. It’s very difficult to design a campaign that successfully reaches two different demographic targets.

But VW pulled it off. The campaign was genius, with modern taglines like “Less flower, more power,” that sparked nostalgia in Boomers and spoke individuality to Millennials. The result was immediate success, creating a new “odd-shaped” category that would soon see competition in the reintroduced Mini Cooper, the PT Cruiser and others.

The original Beetle is a superb example of a flawed product saved by great marketing. And the marketing that launched its reintroduction was even better.

See 15 Cautionary Tales: Failed Marketing Campaigns for more information.

Part 2 of 2: MBA study tour in Peru – Machu Picchu, microfinance, stocks, adventure

Guest post by Oliver Huslid, Evening MBA student

peru2011Machu Picchu
We took a bus, a train, and then a bus again to reach the top of Machu Picchu Mountain where the ruins are. My headache left me, which is fortunate since the first thing I did upon arrival is sprint across the ruins to get my name on the list for the Huaynu Pichu hike. Only 300 visitors are allowed at a time and I wanted to catch up with my classmates who had taken earlier buses than I. The climb forces me to do a solid hour of stair-stepping but rewards me with a majestic view of the Machu Picchu ruins.
 
Microfinance and women entrepreneurs
Our first company visit is with Credivision, a WorldVision-owned microfinance company focused on lending to women in Peru. They have medium-sized operations, having fewer than 200 active accounts but always expanding. A stringent application process ensures high-quality borrowers on their portfolio and a high repayment rate. A minimum of 10 women are required to apply for a loan together as a group—this is to encourage the borrowers to help each other out with their businesses, whether it’s giving advice or pooling funds. Because they’re on the hook together, they will often cover for each other’s payments should one borrower’s business fail and peer pressure the delinquent individual into solvency.

Peru_stocks_0971Peru stock exchange
We visit the stock exchange, a nondescript commercial building in one of the business districts of town. The presenter is regrettably too incoherent for me to learn anything, though I do recall from an earlier presentation that Peru’s stock market is over half mining capitalization. Their goal is to merge with Colombia’s stock exchange, which is dominated by textiles, and Argentina’s stock exchange, which is dominated by services, to create a unified and diversified stock market.
 
Paragliding over Peru
On my last day, I go paragliding off the cliffs of Lima by the shoreline. For the first time, I’m able to see across the endless city of Lima, home to 8 million, and I immediately forget all that’s on my mind. I look down the coast until the beach meets the horizon and begin to feel very relaxed. The paragliders and I head back to the hotel and meet up with our classmates, all of whom venture into the city for one last shopping adventure. Feeling tranquil, I instead opt to lay by the waterfall pool, dozing off to the sunset, waiting for the hour that I must board the plane to whisk me away from my Peruvian dream.

Oliver is one of many University of Washington Foster School of Business MBA students who studied abroad in 2011. Learn more about MBA study and work abroad opportunities.

Part 1 of 2: MBA study tour in Peru – Coffee, copper, economics

Guest post by Oliver Huslid, Evening MBA student

Peru_0097Silicon Valley of Peru
Microsoft Peru rents space from an unassuming office building in the heart of the city. Because this particular satellite branch only does Sales, it does not have the need for a sprawling complex like that in Redmond.  The immediate surrounding area has a new and modern feel to it. The architecture of the buildings showcases their glass and clean concrete. Because Microsoft’s neighbors include HP, Cisco, Oracle, and Google, it’s no wonder they call this area the “Silicon Valley of Peru.”

Coffee co-op
We visited Café Villa Rica, a co-op of coffee-growers in the Villa Rica region. Headquarters were located inside an unmarked office building in a sleepy residential area of Lima. Café Villa Rica is a privately owned and privately funded since local banks do not trust farmland as good collateral for loans.  They grow, pick, and process their own beans to ensure quality. Unfortunately, Peru does not yet have a big coffee-drinking culture, so most of their beans are exported to coffee-drinking nations like the United States. Café Villa Rica sells about 60% of its beans to Starbucks, where their acidic, earthy beans are mixed with Kenyan beans to balance out some flavors for Starbucks’ customers.

Copper mining
We walk around the corner to visit the headquarters of Southern Peru Copper Corporation, a copper mining corporation with extraction sites in Peru and Mexico. The copper industry enjoys high margins and an accelerating demand from developing countries like China. Year over year EBITDA is in the triple billions for this particular company despite issues with strikes, corrupt unions, and increasing environmental backlash.

Though recent demand slowed in 2009 due to lagging construction needs in the global sphere, demand has picked up pace again in 2010. As one of the largest mining companies in the world, Southern Peru Copper Corporation mines a diversity of minerals and metals, like molybdenum, zinc, and others.

Peru’s national economy
We began one day with a visit to the Ministry of Foreign Relations, where we are treated to an exposition on the strengths of Peru’s economy.

Many of the charts convey dramatic increases of key exports in the past decade, highlighting Peru’s rapid expansion and growing presence in the global trade arena. Peru’s modern approach to global economics has earned it crucial free trade agreements with a large number of countries, including the United States and much of Europe. The impact of these decisions has improved the standard of life for Peruvians substantially, as evidenced by the poverty level dropping from 50% to about 35% over the past decade.

One major weakness of Peru’s economy that they are trying to remedy is overreliance on exporting to the United States and other developed nations. The other major weakness of Peru’s economy is heavy saturation of mining companies. This trait of the Peruvian economy makes it vulnerable to fluctuating commodity prices for metals and minerals.

Oliver is one of many University of Washington Foster School of Business MBA students who studied abroad in 2011. Learn more about MBA study and work abroad opportunities.

$22,500 awarded to clean technology winners

Teams who won the 3rd annual University of Washington Environmental Innovation Challenge invented solutions to some of the world’s most pressing environmental issues. Wind energy. Electric car improvements. Biomass energy. Water purification. Algal biofuel efficiency. The 2011 event also had a range of other clean-tech innovations with 17 teams from Washington state universities (UW, WSU, WWU and SPU) competing. Undergraduate, graduate and PhD students from engineering, business, economics, philosophy and a number of other disciplines joined forces to tackle the environment.

VoltaicGrand Prize of $10,000 = Voltaic

A group of UW undergraduate engineers and business students created an electric vehicle modular drive train that can replace drive trains of gas-powered engines in existing models. The electric module can be customized to fit inside any car and the team displayed a Honda outfitted with its prototype electric engine to show how it powers the car.

2nd Prize of $5,000 = PotaVida

This UW PhD team (an electrical engineer, bio-engineer and policy analyst) created a device that measures water quality with a reusable, solar-powered electronic indicator for monitoring solar disinfection of drinking water. Their inexpensive indicator won a $40,000 design award last year and will be field tested in Bolivia this summer. PotaVida is advised by experts at PATH and Microsoft as well as UW professors.

Three honorable mention prizes of $2,500 each went to other UW interdisciplinary teams. Pterofin invented an affordable, more versatile alternative to wind turbines; the new device is lighter than current wind technology and harnesses wind energy at lower wind speeds. BioTek has a patented and patent-pending suite of tools to help optimize and scale the growing algal biofuel industry; their instruments and software are low-cost and field-ready. C6 Systems created a novel system to turn woody biomass into charcoal (or biochar) at forestry sites; their biochar can be sold to heating/electric plants or used as soil enhancement.

Starbucks VP of Sustainable Procurement Sue Mecklenburg, one of many business, science and venture capital judges at the event, said, “It just gets better every year.”

“The Environmental Innovation Challenge is supposed to be more than a university-level science fair. The goal is to be able to take these ideas into a real, revenue-generating business,” said James Barger, UW undergraduate mechanical engineering student who serves as VP of finance for Voltaic.

The UW Environmental Innovation Challenge is sponsored by the UW Foster School of Business Center for Innovation and Entrepreneurship, UW College of Engineering, UW College of the Environment and UW Center for Commercialization.