Monday, April 29, 2013

Making Data Work for You: Kelley Forum on Business Analytics

By Matt McAndrews - Class of 2014, Consumer Marketing

Matt McAndrews
This semester I loaded up on analytics courses. Spreadsheet Modeling, Data Mining, Marketing Intelligence, and Marketing Strategy. It's been a semester of regressions, logarithms, decision trees and principal component analysis. It felt like learning a new language - "Nagelkerke R-Squared" and "Varimax Roatation". And I've learned how to run analytics across platforms, from Excel to SPSS to SPSS Modeler.

Sometimes during the semester, I wondered what I was doing learning the material. Would I use it in my career, or was it all theoretical gibberish? Sure, I could build models that could predict outcomes with a 2% better probability than randomness, but was this stuff even used in the real world?
Michael Chu
Principal at McKinsey & Co

On April 12, I had the opportunity to attend the Kelley Forum on Business Analytics. The keynote speaker Michael Chu, Principal at McKinsey & Company, spoke to the transformative value of data to test hypotheses, replace human decision-making, and to innovate new business models. Representatives from FedEx, Deloitte, Proctor & Gamble, and IBM spoke to the difficulty in finding managers who understood analytics. I was inspired; analytics was real, powerful, and firms were looking for talent.

Michael Wilhite
Senior Vice President, dumhumby USA
leader of Kroger Insights and
customer knowledge capability 
One of the best breakout sessions I attended was held by Michael Wilhite, Head of Global Analytics at dunhumby.  He spoke about data analytics in retail. Successful retail establishments are moving beyond the traditional models of broadly segmenting the market. Rules-driven algorithms can personalize products and services, to create a stronger relationship between the retailer and the customer.  While some consumers may see this as a betrayal of privacy, other consumers appreciate that a business understands their specific needs and can offer exactly what is wanted. Data analytics is transforming the retail experience from the impersonal big box to practically having a personal shopper.

At the company roundtables which completed the program, I was able to network with a number of firms recruiting for analytics consultants, such as IBM, Booze Allen Hamilton, and Deloitte, as well as firms looking to fill internal analytics positions, including Discover and Proctor & Gamble. As opposed to the crowded finance and marketing networking fairs from the winter recruiting season, this crowd was sparse, and the recruiters were eager. At the end of the day, I knew that the analytics skills I have been learning in class are in demand, and my Kelley MBA is setting me up for success.  

Tuesday, April 23, 2013

Venture Capital Investment Competition

By Damon Yousefy, JD/MBA

The Venture Capital Investment Competition (VCIC) is a global competition that involves 60 top ranked MBA teams from 3 continents. The competing MBA programs must:
·         Review real start-up business plans
·         Conduct due diligence with entrepreneurs
·         Write term sheets and executive summaries for their chosen investment
·         Negotiate with the entrepreneur in front of judges and a live audience
·         Answer judges’ questions about their strategy and assumptions

This year, Indiana sent a team of 4 JD/MBA dual degree students and one law student to the VCIC Regional Finals in Toronto at the University of Toronto’s Rotman School of Management. Indiana faced teams from Harvard, Yale, Cornell, Michigan, and Rochester in the regional final.

Me at the VCIC International Championship
Team Indiana came prepared against this formidable list of rival MBA programs thanks to courses and coaching from Professor David Haeberle, Professor Dave Greene, and Professor Mark Need. Mark Need was our coach and he traveled with us and gave us helpful advice on how to handle the competition as well as best practices from prior years. David Haeberle’s Venture Finance class gave me the financial tools we needed to break down the value of startups, and his models are unique because a discounted cash flow (DCF) analysis is useless when evaluating startups. Dave Greene’s M&A class gave me a chance to simulate a real acquisition from drafting term sheets to negotiating the final deal.

The team put me in charge of the financial calculations, term sheet, and negotiation because of the skills I have gained from the aforementioned courses. After the judges had a chance to deliberate, we were crowned champions of the VCIC Northeast Regional Finals and awarded a check for $1,500.

Winning the Northeast Regional Finals punched our ticket to the VCIC International Finals at UNC’s campus in Chapel Hill. Ten schools from 3 continents advanced to the International Finals. The first day of the competition was due diligence, and the sessions were held at the American Tobacco Campus in Durham, a new startup incubator. After the due diligence sessions, the advancing teams were announced.

Indiana made the final round and we had to prepare for the negotiation and live Q&A with the judges. After all the teams finished presenting, we were ushered outside UNC’s business school for celebratory drinks and food prior to the announcement of winners. While a 4th place finish was disappointing for us, it proved that Indiana’s MBAs can hold their own against top schools from around the world.
Brandon Benjamin (4th year JD/MBA), Nathan Chun (3rd year JD/MBA), Eli Stoughton (3rd year JD), Jorge Alvarez (3rd year JD/MBA), Damon Yousefy (4th year JD/MBA)

Wednesday, April 3, 2013

Highlights from GLOBASE India 2013

By Erin Faulk, First year, Marketing

Teaching our lesson to 8-10 year olds
Day 1: Today we are headed up north to Sidhbari in Himachal Pradesh. Our client, Chinmaya Organisation for Rural Development (CORD) is located in the Khangra District of Himachal Pradesh.

We are all excited to meet the staff at CORD who we have been working with over the past 7 weeks. Between language challenges and Skype inconsistencies due to spotty internet connections, it will be great to continue the progress on our projects in person. My team has developed an entire career exploration and self-discovery program that involves changing many of the cultural norms in these communities, so we need to make sure we are aligned with our team leaders at CORD before going into the field. 

Day 3 : Now that I have mastered the art of bucket showers and feel completely at home while dressed in my salwar kameez. Our projects are in full-force and the clock is ticking to get everything accomplished on our field plan.

Each day has presented new obstacles that my team was not prepared for...and today was no different! First, we visited a local secondary school to test activities from our career exploration program. We had prepped a lesson for high schoolers, but when we walked in, there were thirty 8-10 year olds eagerly waiting for us. We were forced to adapt our entire lesson on the fly!

Day 5: 
Today is our last day at Chinmaya Organisation for Rural Development (CORD), and it is difficult to put my emotions into words. After working so hard to get to know the staff and mission of CORD over the past seven weeks  it feels like we have made ourselves a new home in Sidhbari. We haven't even packed yet, but you can sense the group missing CORD already.

Closing ceremonies with Dr. Didi

It was awesome to see the progress each team made while in country. All presentations engaged the community and pushed CORD in different ways; to create an accelerated marketing plan to stabilize funding and fuel expansion of their footprint, to invest in a vermicompost training center to increase the sustainability of farming as a reliable trade in rural India, or to lead the initiative for changing the community's understanding of choosing a career based on personal values and skills.

Dr. Didi closed out the ceremony with inspiring words. She called on local field workers to share what they had learned from us, expressed the strength and significance of the relationship between Kelley and CORD over the past three years, and pressured us to harness our power to create opportunities and make impact in our futures. She then passed out small gifts made by the women in the Mahila Mandal groups. Dr. Didi hugged every single one of us, calling us by name and personally thanked us for our work. What an amazing, rewarding experience!

Tuesday, April 2, 2013

Visiting Scholar Offers Insight on Yet Another Financial Crisis

By Tulio Bracho, First-year MBA, Finance

IGOE Fellows
There is a country with a population of 47 million people and an unemployment rate of 26%. The families of this country are in despair, struggling to make ends meet. This country’s society is burdened with the responsibility to support its struggling population, but has limited ability to borrow funds. The problem that this country faces is not a lack of education, natural resources, or democracy. Can you guess which country this is?

In today’s world economy, there are plenty of countries suffering from similar ailments as the ones described above. But, what if I told you that this country is home to multinational corporations, some of the best business schools in the world, the world cup national soccer champion team, and – according to them – the best wine you could ever taste? Can you guess now? 

Yes, I am talking about Spain. 

That friendly and beautiful country is fighting a battle to find a path of sustainable and healthy economic growth. Spain would like to accomplish in the economic and social realms what its athletes have accomplished in a wide range of disciplines. Professor Gustavo Lannelongue, Visiting Scholar from the Universidad de Salamanca and hosted at Kelley by the Institute for Global Organizational Effectiveness (IGOE), presented an analysis of the Spanish economy last Thursday to the IGOE MBA and PhD Global Fellows.

During his presentation, Professor Lannelongue explained that even though the Spanish financial crisis may have been caused by the same reason as the American crisis, a bubble in the construction sector, its consequences and its treatment have been different. The basic difference is rooted in the monetary system in which the Spanish economy operates. Being part of the Euro implies that Spain has limited influence in determining its monetary policy, so it has to focus on other types of solutions (e.g. fiscal policy). 

There are three areas in which the Spanish government has implemented measures to improve the economy. First, reform of the labor market, which translated into less employee power of negotiation, reduced unemployment benefits, and increased retirement age (65 -> 67). Second, spending cuts in development aid, state owned companies (railway, television), and subsidies for parties and social partners (- 20 %). Third, tax raises, such as an increase in the value added tax to 21% (from 16%), income tax rates (between 0.75% to 7% proportionally), and capital taxes (between 2% to 6%).

Fortunately, after those measures and the effects of the monetary policy the European Central Bank had implemented, the Spanish economy started showing some signs of stabilization. Recently the levels of debt have stabilized, the index of real estate prices has become attractive to foreign investors, the cost of labor has declined making it easier for businesses to hire people, and exports have increased. Of course, there are many challenges still to face and structural reforms that Spain must implement to improve its competitiveness, but it is good to know that reasonably good work is being done.  

Hopefully, political forces will continue lowering their populist voices and letting the experts do what must be done. At the end of the day, problems are solved by people who care less about pointing fingers and care more about rational thinking, sharp analysis and hard work. The great Spanish writer Miguel de Cervantes expressed well in Don Quixote, “It is not the responsibility of knights errant to discover whether the afflicted, the enchained and the oppressed whom they encounter on the road are reduced to these circumstances and suffer this distress for their vices, or for their virtues: the knight's sole responsibility is to succor them as people in need, having eyes only for their sufferings, not for their misdeeds.”