When a well-known technology company purchases a hot new startup, it makes news. But long before that announcement, accountants have spent hours behind the scenes evaluating the value of the company and its assets. While valuation occurs in all sorts of mergers, acquisitions and even annual tax filings, technological products and property expand the scope and complexity of corporate valuation.
Valuation can mean anything from the value of the staff to the perception of the company’s trademarks. It can include modeling and analyzing business interests and assets, including intellectual property or customer relationships—a far cry from evaluating more tangible assets and made trickier by the topic at hand.
Bob Shi, MAcc’14
Deloitte advisory consultant Bob Shi, MAcc’14, is becoming fluent on valuing tech assets, thanks to his work on high-profile projects. None of it, he believes, would have been possible without the one-year MAcc valuation program at Vanderbilt. His undergraduate work included combined degrees in math and economics. Owen was where everything came together.
“The MAcc valuation program really was a nice marriage with my math and economics backgrounds,” Shi says. He interned at Deloitte in Dallas and was hired after graduation. He has worked on some of Deloitte’s key projects, including the split of HP Inc. and Hewlett Packard Enterprise, where his work focused on modeling and data analytics.
Valuation is a challenging field in the most straightforward of circumstances, he says, and more so for tech companies because the assets are valued in a nonstandard fashion. The HP separation was made more intricate due to the added layer of valuing the intercompany relationships. Shi says the project required constant contact with his HP clients—something for which Vanderbilt prepared him well.
“During the fall semester at Owen, we had several events with the Big Four companies, like meet-and-greets or social events or dinners. We got to know the individual firms that we’d potentially be working with,” Shi adds. “For me, coming out of an undergraduate program where I didn’t engage too much in public speaking or mingling, the first few events were a little awkward. I wasn’t entirely sure I had a handle on myself.
“I knew if I wanted to succeed in public accounting—and this sort of valuation work—I would need to handle myself in that setting. As we spent more time with other professionals, I became more comfortable engaging them and navigating though large groups.”
That was evident during an initial meeting at HP headquarters to meet with high-ranking executives. “Rather than being the shy new guy sitting on the computer taking notes, I was able to actively engage in conversations with them, get a feel for what they did, how we needed to treat their data and get a better grasp of what it was Deloitte would be doing for HP,” Shi says. “Without the events and the training that the MAcc program provided, I wouldn’t have had as effective a meeting, nor would I have gleaned as much information as I did.”
Even with his 50th birthday just around the corner, Mark Tillinger, BA’81, MBA’82, did not have a midlife crisis: He was too busy fighting for his life. Emerging on the other side of a cancer diagnosis and treatment, he sought opportunities to make small investments in the lives of others—with hope that those small changes would build into something much larger.
Tillinger knew first-hand how investing in someone can make a difference for that person. He came to Vanderbilt as an undergraduate, inspired—and invested in—by his high school math teacher in Atlanta, a Vanderbilt alumnus. Tillinger chose the combined five-year Vanderbilt MBA degree offered at the time—four years for his bachelor degree in economics, the last year overlapping with Vanderbilt’s MBA program.
Soon after graduation, Tillinger landed at Arthur Andersen in its management consulting information division. He was based in Nashville until he was hired away by Commerce Union Bank as a director of strategic planning. When the bank merged with another, he was recruited back to Andersen’s Nashville office, and then on to Richmond, Virginia, where he headed the banking division. When he became partner—and Andersen morphed into Accenture—he moved to the New York office.
Opportunities for extraordinary things
He was working in New York and living in nearby Connecticut when he started cancer treatment. Cancer coincided with reaching the age of early retirement, an Andersen/Accenture benefit for partners at age 50. Although he hadn’t originally planned on retiring right at 50, his illness made him question how he wanted to spend the rest of his life.
The answer was help others. He took retirement.
One of his first ways to help was creating a need-based scholarship for Vanderbilt MBA students, the Mark A. Tillinger Scholarship Fund.
“I knew I wanted to make a reasonably significant contribution, but I wasn’t sure how to do it since I was an undergrad as well as an Owen grad. Ultimately, we focused on funding the scholarship at Owen,” he says. “It was exactly for that reason: to give opportunities to students who might not otherwise be able to go and help them launch their own careers.”
Five Owen students have received the scholarship since he endowed it in 2007. But he’s given more than the funding—he’s invested personally in the lives of students who received it as well. “That’s been on an individual basis and if it’s something the student wants,” he explains.
Those relationships have helped him to see how his goals for the scholarship program are being met. “It’s a small gesture, but one that hopefully will generate some people who go on to do some extraordinary things,” he said. “I’ve been thrilled to be able to do it.”
Continuing the fight
After retiring, Tillinger did something else that has even made the pages of People magazine: He launched the Riedel & Cody Fund, which offers assistance to pet owners whose dog or cat has cancer.
Why? While Tillinger was in a battle for his life, his beloved Bernese Mountain Dog, Riedel, was fighting her own cancer battle.
Tillinger and his wife, Theresa, with Shafer, their Bernese Mountain Dog, in Nashville’s Centennial Park. After Riedel’s death, Tillinger was reluctant to get another dog until he met Shafer, now three.
While Tillinger successfully beat cancer, Riedel did not. “She was a special dog and I had a very special relationship with her,” he says. “We were fighting so long together and then, when she was gone, I still wanted to fight. I couldn’t turn it off. I didn’t want to turn it off.”
The fund has since helped more than 200 pet owners who needed financial assistance to provide cancer treatments for dogs and cats with cancer. “What has been inspiring to me is there have been many owners who have stepped forward and done extraordinary things and changed lives as a result of our intervention and allowing them to have more time with their dog or cat,” he says. “It sounds cliché, but we truly do believe it: By changing individual lives, one instance at a time, we hope to try to effect major change in the world.”
Back to work and to Tennessee
Not long ago, Tillinger returned to the workforce as vice president of transforming client relationships at Cognizant Technology Solutions. The role has him traveling the globe and helping to solve client challenges. Accepting the job came with the condition that he be allowed to continue his work with Riedel & Cody. The organization has a full-time executive director and generous financial support from Blue Buffalo Company and Petco, but Tillinger continues to chair its board of directors.
Tillinger and his wife, Theresa, recently have moved to the Nashville area and he hopes to be even more involved in Owen. In the 30 years since graduating, he has served on Owen’s Alumni Board and currently serves on the dean’s Board of Visitors. “I don’t know what I’ll be doing over time with Owen and Vanderbilt, but I love the school,” he says. “It’s been a huge part of my life and that’s why I’ve stayed involved with it.”
Whether through a successful career or envisioning a different kind of nonprofit, Tillinger feels he owes much to his Vanderbilt education.
“Without a doubt, the Vanderbilt undergraduate program and Owen trained me how to think,” he says. “The whole approach to the educational philosophy at Vanderbilt at the time—and I’m confident it still is this way—is all about giving graduates the skills and tools to be analytical, with that core capability to essentially always ask the next question in a very structured way.” ■
When students in Vanderbilt’s one-year programs—the master of accountancy, master of finance, and master of accountancy valuation—graduate, they don’t just enter the workforce with business skills and expertise in accounting, accounting valuation or finance—they also leave with powerful leadership skills.
To prepare for what awaits in a rapidly changing workforce, students participate in Owen’s Leadership Development Program, which provides robust assessments of their strengths and weaknesses plus sessions with an independent, certified executive coach.
Kate Barraclough oversees the master of finance program
“We would like to differentiate our program by seeing it not just providing skills for your first job, but providing you with skills that will last over the course of your career,” says Kate Barraclough, the MS Finance program director.
Proven
Part of that success requires being able to lead projects, people or both, regardless of job title. Already, master’s program graduates are demonstrating that they have the skills needed to make a difference in the workplace.
Karl Hackenbrack, associate dean and director of accountancy, points to Amelia Emmert, MAcc’08, who was just promoted to manager at EY—the first MAcc graduate to do so. He believes she will quickly be joined by others. “Her class is the first one to have the tenure to earn the rank of manager,” Hackenbrack says. “No one will ever question her technical, teaming or managerial skills. She’s proven them to earn the position of manager. I see leadership potential in all students or they wouldn’t be in the program.”
In the international public accounting firms, recent hires have an opportunity to showcase skills at the earliest stages of their career.
“Someone has to do the blocking and tackling,” Hackenbrack says of new public accounting hires. “The willingness to be a contributing member of a larger team and knowing your place within that larger team is extremely important.”
“Who is going to do that the next year? That year’s new hire. That’s where the traditional definition of leadership kicks in with public accounting: You’ll never do this task again. You’ll train someone to do the task that you did last go-round. These teams are structured so that an important part of your job is training the person coming in behind you.”
Owen students receive an individualized approach to leadership development.
It’s apparent in the workplace that Vanderbilt MAcc graduates possess those abilities. Hackenbrack recounts a story told to him by a student whose father is a partner at a Big Four firm. She said that during her internship, she could recognize other Vanderbilt MAcc alums by the way they acted on the job.
Vanderbilt MAcc alumni, Hackenbrack notes, are characterized by their professionalism, strong client and team skills and maturity. “The career development program is recognizable in the workplace,” Hackenbrack says. “I’m sure some of that is recruiting the right people in the first place, but a lot has to do with the professional development programming that occurs on campus.”
A world of possibilities
Barraclough says that the leadership and career development work for Vanderbilt MS Finance students includes building skills that can be applied to jobs in different facets in the industry. “With MS Finance, we’re helping them identify what they want to do and what makes it a good career choice,” Barraclough says of the intensive nine-month program. “We help them understand who they are as professionals and how knowing their strengths helps them be more effective and successful as team members and as leaders in the workplace.”
An individualized approach runs throughout Owen’s Leadership Development Program, no matter the degree, says Amy Lambert, MBA’04, senior manager of the program. Lambert works with students in the young professional tracks directly.
“The way that we have approached leadership development at Owen in general has been to meet each student where they are as an individual, no matter where they are in their career path,” Lambert says. “Regardless of where they are headed, we help them capture the building blocks to start working toward to that long-term future.”
David Owens taught 52,000 students in a massive open online course—and it changed how he reaches students in the Vanderbilt classroom.
When David Owens set out to teach a massive open online course (MOOC) with 52,000 registrants across the globe, he knew he was charting new territory. What he didn’t know was that the territory would also include his classes right here at Owen.
Owens, professor of the practice of management and innovation, was one of four professors asked to pioneer Vanderbilt’s participation in Coursera, an online learning platform through which higher education institutions offer MOOCs. Students take the equivalent of a university-level class for free but do not receive credit.
He taught the Coursera class in spring 2013. The class, which will be offered again in 2014, aligns closely with the professor’s Mod 2 Innovation Strategy class as well as his book, Creative People Must Be Stopped.
Owens, who is also faculty director of the Accelerator— Vanderbilt Summer Business Institute, says that what he learned in teaching 52,000 students online has changed how he teaches his in-person Vanderbilt class of 67 students.
Not the usual MOOC
On the surface, the methods of teaching a MOOC are simple. Prepare slides to be the visuals and then digitally record lectures to be viewed online by MOOC participants on their own time. Class interaction happens in online forums. The number of students and their geographic locations vary.
Owens started by trying the basic MOOC tack—recording his lectures, both in class and in a makeshift studio—but found that boring. So the professor of innovation found his own way of improving the online course.
“I went with more high-quality production. It made more work, but made it more interesting and fun,” he says. “It was all-consuming.”
And that was just the creation of the video lectures, which he then edited, incorporating music and slides; a teaching assistant created original artwork. Since Coursera is a for-profit company, the same copyright laws that allow fair use of creative works in the classroom did not apply.
After each Coursera lecture posted, he and teaching assistants would participate in forums with the students. “Every time I went into the forums, I’d see something and go, ‘Wow that’s interesting.’”
Project work was another area in which Owens veered from usual MOOC practice. The Coursera students were offered two options. The first was to view the lectures, participate in forums and take quizzes to receive a certificate. But those who completed an additional project received a certificate with distinction. The tiered certificate—Owens’ idea—was a first for Coursera. About 1,000 students completed the project.
The classroom profits
Understanding how online students applied the course material and built upon insights shared in the forums led Owens to make a change in his MBA classes.
For his on-campus fall Mod 2 course, he assigned students to view his video lectures outside of class. They also read material and took quizzes online. Class time was devoted to working on projects.
“I can tend to projects—which is more my stronger skill—during class time rather than trying to fit them in between classes,” he says. Students benefit from the focused classroom time to work on projects.
Based on the success of the Coursera students’ projects, Owens has also raised his expectations for what Vanderbilt MBA students can accomplish.
Owens says that the Coursera students who chose to do extra work ended up doing amazing projects. “It makes me believe that I’m not challenging students enough. We’ll push ourselves to do more complex projects,” he says. “On the other hand, the goal of the project is the application of the material. It was interesting to see that the problems people in China were having were the same as in the U.S. People in Tierra del Fuego have the same issues of pushing projects ahead. In that way, it was reassuring.”
“I can tend to projects—which is more my stronger skill—during class time rather than trying to fit them in between classes”—David Owens
The international cooperation carried out in the Coursera program has led to another requirement for Vanderbilt MBA students: Each project team now includes at least one international student. Owens says this allows students to “work on the skill of being able to bring people to your problem or issue and getting them committed to it.”
Powerful online discussion
He’s also gained a new appreciation for the power of discussion boards; he had used them previously at Owen but without success. “I’d use one, and two people would post, so I’d stop it. In the online course, all the action was there,” he says. “I saw that it can be powerful if I enforce the use of it, build etiquette around it and tend to it myself.”
Requiring students to participate in the forums is better than inviting them into the classroom discussion, Owens believes.
Donning blindfolds and being led by partners around campus encouraged Owens’ Innovation Strategy students to think differently. Using the Coursera model of having students review lectures outside class allows Owens to teach more dynamically.
“Requiring people to post and respond to posts, you can’t hide. I may cold-call a student in class once, and if I see I have made a horrible mistake, I tend to not do that again because of the emotional effect it will have on the class,” he says. Some students are shy, haven’t read the material or are in a bad mood, he says. “In the online forums, when they feel like doing it, they can.”
Owens also believes teaching through Coursera has transformed his lectures forever.
“I’m more careful and aware that there is a lot of power in the slides. If I do a lot of slides, any one slide is a throwaway. But through Coursera, I had to look at every slide to make sure that there was nothing copyrighted and knowing that thousands of people would be looking at it,” he says. “Now I’m aware of the power in that, and in the image, and that I can use it very powerfully or very poorly.
“I think more about using video and audio in class,” he says. “Those are things that help bring classes alive.”
When Owen wanted to expand its global perspective, the school turned to its alumni and corporate clients to discover what their needs were. What they found was right in their own backyard: the Western Hemisphere.
Juli Bennett
“We spoke with alumni and recognized that they have made their operations go across the Americas. We saw a need to give people a perspective of how it is to operate across North and South America,” says Juli Bennett, MBA’93, executive director of the Executive MBA and Americas MBA for Executives programs. “We responded to a business need.”
The Americas MBA is a focused, optional track in the Executive MBA program. Participants spend their first year in step with students in the traditional program. The second year, they focus more heavily on international business, working on international capstone projects and attending 10-day residential immersions at participating schools: Fundação Instituto De Administração in São Paulo; Instituto Tecnológico Autónomo de México in Mexico City; and Simon Fraser University in Vancouver, B.C. The students from those programs join the Owen students for another nine days at Vanderbilt. When the students graduate, they have a deep and relevant understanding of international trade, particularly within the four largest economies in the Americas: Brazil, Canada, Mexico and the U.S.
The inaugural Americas MBA class consisting of 52 students representing 10 countries spanning the globe from Brazil to Vietnam.
“Mostly when you look at executive MBA programs, they do the same thing we used to do: take their students and their faculty and go to a different location,” Bennett says. “With this model, when you go to Simon Fraser you’re taught by the top cross-cultural experts at Simon Fraser. The four schools’ faculty are experts at things like family businesses in Mexico. They know the people who are excellent at emerging markets in Brazil. It’s not us trying to be everything to everyone. It’s leveraging the expertise of those four schools.”
It’s also leveraging the expertise of their peers. Working across borders with students from the other schools, Americas MBA students benefit from their peers’ insights and experiences—something that will be invaluable in their future careers.
From left, Mark Mathiasen, Luciano Greggio, Beth Bernier, AMBA’13, Paulina Villasana and Agustin Eugenio Caballero Ortiz Rubio at Nashville’s Entrepreneur Center during their 10-day residency.
Have Americas MBA, will travel
A dozen students graduated in 2013, comparable to those who are expected to earn their degrees in 2014. Bennett believes the ideal student is one who is “looking for an expat assignment, looking to expand ability to communicate across cultures, who has always had an interest in different ways of thinking.”
Students came from top companies and organizations, including American Express, Bridgestone Americas, BMW, Citi, Embraer, Johnson & Johnson, Mars Petcare, Siemens, Schneider Electric, Tennessee Valley Authority and Unilever.
Jon Haworth, AMBA’13, was vice president, plant operations and innovation at Des-Case. His company, which manufactures contamination control products for industrial lubricants, does about a third of its business outside the United States. That led Haworth to consider gaining international experience. He consulted with Des-Case President and CEO Brian Gleason, who earned his Vanderbilt Executive MBA in 1997.
“I remember asking for his opinion on which one of the programs I should pursue and him saying I should do the Americas program,” Haworth says. “I want to do more in emerging markets. That program was perfect for that. The other side is that I’ve lived in South America and am fluent in Portuguese.”
Across time zones and cultures
Des-Case also was used as a yearlong Americas MBA capstone strategy project, which the students must complete while working with counterparts at the three other universities.
“We’ve already seen nice growth in Latin America,” Des-Case’s Gleason says. “As well as we’ve done there, we all recognized there was a tremendous upside that we’ve not come close to tapping. Jon and his group did a nice job in shaping an argument for what we ought to be doing and creating a framework by which we’ll make future decisions in other markets globally. We’ll make the same kinds of decisions for Europe and for Asia at some point.”
“They have to figure out how to work virtually…to get through the cultural and language barriers and to figure out how to get it done. ”—Juli Bennett, executive director, Executive MBA programs
The cross-cultural experience of the project teams provides excellent preparation for the future.
“They have to figure out how to work virtually, through different time zones, to get through the cultural and language barriers and to figure out how to get it done even though they’re not at a table and face to face,” Bennett says. “That is the most challenging part of the program, but if you can figure out how to do that, you will be the one targeted as a leader in these organizations.”
Tough and challenging, the Master of Accountancy Valuation program was developed in conjunction with Owen’s five partner accounting firms to fill a real business need. It is the second of two, one-year Master of Accountancy programs developed by the school to serve accounting firms and recent undergraduates. The first MAcc Valuation class graduated in May.
Kevin Moss, global managing director, valuation services for Deloitte, served on the MAcc advisory board. “What I liked about what MAcc was doing was talking to the clients, getting input from the community that they provide people to. A lot of programs do not do that,” Moss says.
Hackenbrack
In recent years, companies have tried to put a value on intangibles like intellectual property, goodwill and incentive-based compensation. Such valuation expertise is driving the need for a program like MAcc Valuation, says Karl Hackenbrack, associate dean and director of accountancy. “This is the nexus of accounting and finance. Valuation practices are in large part these days staffed by people who started their careers in a more traditional finance area and have to learn the accounting.”
The one-year program is intense; students take required coursework, complete a 10-week internship with one of the partner firms—Deloitte, EY, Grant Thornton, KPMG or PricewaterhouseCoopers—and then graduate. Even then they don’t leave Owen; they receive intensive preparation for the Chartered Financial Analyst and Certified Public Accountant exams.
The 13 members of the first graduating class all took the CFA and CPA preparation courses. They take the first of three CFA exams pre-graduation, and then take the next two exams over the next few years. Of the 2013 graduating class, 11 passed the level one CFA exam.
On the four-part CPA exam, the recent graduates scored a 90.2 percent first-time section pass rate—the highest first-time section pass rate of the top 25 graduate MAcc programs in the nation. Hackenbrack is proud to point out that the pass rate for the CFA exam nationwide is 37 percent while the percentage of those who pass the CPA exam on the first try is in the low teens.
The one-year Master of Accountancy Valuation program is intense but teamwork helps. From left, then-students Becca Stone, Allison Buterbaugh and Cory Thompson. All three MAcc Valuation graduates are now employed with partner firms in valuation or assurance.
Aptitude, attitude and bedside manner
“Whenever I recruit, there are three buckets that I look for: aptitude, which is probably going to get you into most one-year graduate programs; attitude: Do you understand what you’re getting into, in terms of Vanderbilt MAcc Valuation, and are you well-informed to what the programs are about? It is an immersion experience and that’s not for everyone,” Hackenbrack says. “The third is what I call bedside manner, client-facing skills. You have to pass all three to get in.”
Those who are accepted into the program, however, are well prepared for a career in valuation. After graduation, most are headed for a large public accounting firm in a junior-level position.
“That’s part of the value proposition from the firms’ perspectives,” Hackenbrack says. “Think of an audit service line. The bottom of the pyramid is junior staff and the top is partners. In valuation, up until about 10 years ago, those services were provided by professionals who were brought in as manager, director or partner. The pyramid is upside down relative to the audit service line. They need the capability to flip it. We’re first movers in helping them fill the junior service ranks so that they can internally identify the talent.”
Kaylen James, BA’12, MAccV’13, spent her 10-week internship with PricewaterhouseCoopers. She’s now a valuation professional in the firm’s Dallas office.
The firms get a head start on that identification through the internship programs, which occur in January and February, typically a firm’s busy season. Deloitte, Moss’ company, hired six.
“They did an outstanding job,” he says of the interns. “They were well trained in technical skills. He’s (Hackenbrack) recruited people with good people skills. If you’re going to succeed outside of school, you need to have more than academic training, you need to be able to work with people.
“When the students came into the program, they integrated well into teams and … had the technical background that we were looking for,” Moss says. “The students were firing on all cylinders when they came through the door. Normally you’ll have to teach students something. They have all the bases covered as opposed to a few of the bases.”
Tough by intention
The internships provide something of a trial by fire. “I want you in the firms when it’s tough,” Hackenbrack says. “If it’s not for you, come back and say, ‘I don’t want to work that hard.’ It’s intentional to have (the internships) in what the firms traditionally view as their busy season because so many companies have the Dec. 31 year-ends.”
Owen’s first-ever MAcc Valuation class poses with Dean Jim Bradford at Commencement in May 2013.
While Hackenbrack says it’s too early to tell what kind of students will be ideal for the MAcc Valuation program, he believes those who receive their bachelor’s degree in economics will be naturals. “They are taking course work and thinking about issues that they honestly care about and enjoy studying. But let’s face it: What jobs are they going to take at graduation? They’re prepared for graduate school.”
Which can prepare them to fill key roles in booming new areas of business like valuation.
It’s a classic case of supply and demand, with Vanderbilt meeting the demand for sharp human resources professionals with a supply of MBAs trained in human resource. The crunch is driven equally by changes in the corporate world and the reputation of Owen’s Human and Organizational Performance program.
The HOP concentration is among the highest ranked programs at Vanderbilt’s Owen School. Financial Times, for instance, named it No. 4 in specialty MBA programs in the U.S., and No. 7 globally.
That reputation creates competition to land Owen grads for the working world.
“Employers want to get here before anyone else and skim off the cream of the crop, find those qualified students and lock them up for internships,” says Read McNamara, executive director of the school’s Career Management Center. “They feel if they can lock them up for an internship, they have a pretty good chance of having that particular student convert the internship to a full-time offer and a good chance of the student accepting that offer. Companies will push us as hard as they possibly can to get to campus as soon in the school year as they can.”
Case in point: By January 2013, every second-year HOP student had accepted a full-time position. About 60 percent of them came back from their summer internships in the fall with offers for jobs. Vanderbilt’s rate for all MBAs is 40 percent receiving offers after summer internships.
HOP has virtually caught up with other MBAs in salaries, too; McNamara says that the average starting salary for a Vanderbilt MBA grad with a HOP concentration is about $90,000, just shy of the $92,000 average for all MBAs. He expects HOP to be on par with other MBAs by 2015.
“It’s not just the salary. The number of offers per HOP person and the credentials of the people applying to Owen with the stated goal of HOP are certainly on the rise,” McNamara says. “We’re delighted with that and if we keep doing the things we’re doing, there’s no limit to what we can do.”
And no limit to the need, either. Changes in corporate America have shifted views of the workforce. Technological improvements that handle typical HR functions have created opportunities for HR professionals to claim a seat at the table of the upper echelon of company management.
Barry Salzberg, CEO of Deloitte Touche Tahmatsu Limited
“The HR function has been elevated,” says Barry Salzberg, chief executive officer of Deloitte Touche Tohmatsu Limited and a former member of the Owen Graduate School of Management Board of Visitors. “Ten to 15 years ago, human resource directors in large organizations reported to COOs or CFOs; today chief talent/HR officers report directly to CEOs, reflecting the increasing importance of talent. While leading a winning organization looks radically different today versus five years ago, business still relies on people to succeed.”
New demands on HR professionals include using predictive analytics to identify high performers early in their careers or to identify which employees may be likely to leave, Salzberg says. “This model allows for overall workforce planning, which is just as critical to a business’ bottom line as financial planning. Human resources has become a broad and strategic driver in business. This has not only helped us identify and cultivate careers of high-performers, but shifted our development approach from reactive to proactive.”
Reflecting Current Business Needs
Whether a company is growing rapidly, winding down a segment of its business or trying to do more with less to remain competitive, people issues are at the forefront and HR professionals are finding sometimes that seat at the table means at the head.
When Virginia “Ginger” Barnes, EMBA’91, began her career as a contracts administrator at Boeing, she recalls that “empowerment and encouragement thoughts existed only in small pockets and they certainly weren’t popular.” In her first program management job of overseeing early phases of Boeing’s involvement in the International Space Station, she began to understand the importance of people management as she worked closely with Russian counterparts. “That was a real people kind of epiphany,” she says. “We didn’t look alike, but we had the same values.”
Barnes
As CEO of United Space Alliance (USA), Barnes has had the unenviable task of retiring NASA’s space shuttle program. At the peak, USA—an alliance between Boeing and Lockheed Martin—employed 10,500. That number now stands at less than 2,000.
“What I’m most proud of is that we’ve done that with an intense focus on taking care of our people,” Barnes says. “Before I got here, USA benchmarked other companies that had shut down big programs. We didn’t find good examples of people who did it well. We went out to the workforce and said, ‘What do you need from us?’ I have an 11-by-17 spreadsheet of all the initiatives that we have implemented, and I have to say, we have been wildly successful. People come back and thank us for the ways that we helped.”
In 2011, when the shuttle flew its final mission, USA garnered five perfect performance scores from NASA; it marked the first time that USA had received even one perfect score. “I’ve been criticized by some for focusing more on people than I did on profits,” Barnes says. “But at the time that I did, we received the 100 percent award. As hard as this job is, and as unglamorous as it is, it’s the most rewarding experience of my career. Part of that has to do with the people I’m doing it with. We’ve made deliberate decisions about the people that we kept on board to finalize the closeout. In every case, each of those employees has come to me and said, ‘I will take on more, and do whatever you need me to do.’”
Crises, especially over the last five years, have certainly influenced the importance of staffing in companies, whether navigating external challenges or internal issues. “Those kinds of reactive developments have made companies, at the board level, look at the alignment of their own human capital, the importance of human capital and the importance of succession,” McNamara says. “And they’ve reached the conclusion that human resources is no longer a compliance function, but an absolutely essential element in the quiver of a company in terms of the elements it has available to ensure its own success. Visionary companies that recognize the importance of human capital and human capital deployment and planning are way ahead of the curve.”
“Attracting and retaining game-changing talent is at the top of the CEO agenda, as companies and clients expand exponentially in key markets—particularly in Asia and the Middle East.”
—Barry Salzberg
Those visionary companies are using their human relations personnel for entirely new functions. “Attracting and retaining game-changing talent is at the top of the CEO agenda, as companies and clients expand exponentially in key markets—particularly in Asia and the Middle East,” Deloitte’s Salzberg says. “In our global knowledge economy, the right employees make or break organizations, and we’re in the midst of a talent paradox: While layoffs continue and unemployment is high, many jobs still go unfilled because of skill shortages.
“For instance, in the United States alone, 3.6 million jobs were unfilled as of December 2012, according to the Bureau of Labor Statistics, even though the unemployment rate was at 7.8 percent,” Salzberg says. “Globalization and the proliferation of new technologies have forced companies to radically reconsider traditional talent and organizational models to distributed, crowd-sourced models.”
A Need to Understand
As HR gains visibility in upper management, it’s equally important that HR professionals know and understand all facets of business just like their peers with MBAs.
King
Erika Bogar King, MBA’99, began her career as a recruiter before moving into more of an HR generalist role, where she found herself recruiting those with graduate degrees to fill banking positions. “I hadn’t really thought of it before, but one turned to me and said, ‘So when are you going (to graduate school)?’ I looked at Owen because the professionals that I knew came from there were more accessible, more balanced in their approach,” says King, now talent director for Deloitte Consulting. “I liked the cultural sense that I was getting from the talent as well as the quality. I knew it fit would me.”
She also was attracted to the business background that embodied the HOP concentration. “I knew I wanted to stay in professional services and Owen’s HOP program was not from a psychology or people basis, but from a business basis first with the people element,” she says.
Nancy Abbott, EMBA’91, wanted to change fields and move out of the IT function at her company, GE. Her undergraduate degree in behavioral science made human resources the logical choice. “I wanted to immerse myself in areas I hadn’t studied in undergrad. I needed to know how to read a balance sheet, get better grounded in economics and learn the language of business,” she says. “That was my goal in choosing Owen. In the job that I had, I realized I didn’t truly understand finance, business metrics and key drivers. I wanted to build my skills to be a credible business partner. We continue to have a strong relationship with Owen and recruit here every year because of the talented, business-focused HOP graduates.”
“I think I’ve been lucky to be in a company where it’s assumed that HR has a seat at the table,” says Abbott, who leads organization and talent development for GE Capital. “Although it’s expected that you have a seat, you have to understand how the business works and contribute broadly to the business’s success, or you’ll lose that seat.”
When Abbott worked on an acquisition, one of the biggest learning curves was helping the new employees to understand the role of HR. “They viewed HR as very tactical, more about benefits and payroll transactions,” she says. “They had no vision of the value we could add, such as attracting, growing and developing terrific talent.”
Abbott
Abbott sees traditional human resource functions such as payroll and benefits as activities many companies are outsourcing to specialists or centralized centers of excellence. “That’s an evolution that has allowed HR people at GE to focus on the most critical and strategic needs of the business,” she says.
In her role, Abbott must have a clear understanding of the company’s worldwide business goals. “Without really knowing the needs of a particular business unit, and its plans for the future, I can’t help to identify the best possible talent to help it reach its goals. In my role, I’m one of the few people in GE Capital who looks across the top performers in all our businesses to see where in the world they might be matched with a great new opportunity,” she says.
Success Secrets
In business, timing is everything and Vanderbilt has a strategic advantage: It’s growing its HOP concentration at a time when other business schools have eliminated programs. “A number of premier programs either de-emphasized or dropped human resources,” McNamara says. “I think they’d love to have that one back and do it again.”
McNamara
Vanderbilt has a strategic advantage: It’s growing its HOP concentration at a time when other business schools have eliminated programs.
While others may have stepped out of the HOP studies, Vanderbilt has stepped up. McNamara sees the possibility of doubling the number of students specializing in HOP to as much as 15 to 20 percent of its MBA class. The secret to the success? “No. 1 is faculty,” McNamara says. “If you look at the accomplishments of our management department faculty, and specifically people who teach HOP, these are folks who have gained a reputation inside the classroom and out, in terms of research and recognition. The kind of people who come to study HOP do their homework and understand the value of the faculty.”
McNamara also cites Owen’s forward-looking curriculum and association with Peabody College of education and human development, which is widely recognized for its organizational performance programs. “There’s a spillover effect of the wonderful reputation of Peabody on Owen,” he says. “We’re recognized as having two of the premier organizational programs. Finally, it’s the self-perpetuating excellence in that our HOP people go on to great careers in corporate or consulting, and they’re people who come back and get involved. The alumni involvement will not permit this great program to slip.”
Transforming the Future
Human capital has risen in importance along with other corporate functions, but it is not without unique challenges.
“Because people associate HR with the touchy-feely things, it does not get the respect that finance does,” King says. “I do think there are probably HR organizations that still are the people who organize the company picnic and other events. It’s hard to pull away and tell your clients that you’re not going to do this anymore.”
At Amgen, the transactional aspects of HR have been moved back to the staff level, and human resources has shifted to coaching and advising. Centers of excellence handle recruiting and scheduling job interviews, says Joe Parise, MBA’10, Amgen human resources manager. “Having a business background helps you speak the client’s language much faster. Transactional work is not what our clients need,” he says. “Clients come to me for decisions on what they want to do. My job is really to hold a mirror up to them, to explore unintended consequences, to be a sounding board.”
Parise
And to be a sounding board requires a strong understanding of the issues, the kind of understanding gained through an MBA.
“It’s doubly important here at Deloitte,” King says. “My clients have the degree. My clients are advisers to their clients. They expect that I have the ability to manage change, to be able to craft a vision, to understand project management and how we extract value from our practitioners.”
When all the elements come together, the role that HR professionals play in their corporations can—and will continue to—be a formula for success. “When an organization becomes known for cultivating and developing talent, the market brand is strengthened,” Salzberg says. “This ultimately increases their ability to attract and retain high performers. When a company attracts top talent, it can quickly fill new and open positions without missing a beat. Keeping unfilled positions to a minimum can lead to increased productivity and profitability, greater innovation and faster time to market.”
After graduating with a bachelor’s degree in engineering and economics in 2011, Tim Maloney decided to stay at Vanderbilt for one more year. Having a master’s in finance, he believed, would be an important differentiator in a difficult job market.
Turns out he was right.
“It’s definitely a really tough job market, but the master’s helped me get the job I wanted,” he says. This past summer Maloney, BS’11, MSF’12, began working at Morgan Stanley as an Analyst. His focus is largely in fixed income, foreign exchange and emerging markets.
Preparing students to enter a variety of finance jobs is at the core of the yearlong Vanderbilt MS Finance program—a goal made all the more important after the financial sector was hit particularly hard with job losses during the recession.
“What we aim to do is give students a broad-based skill set so that they can go into almost any area—banking, investments, corporate finance—and start tackling real problems right away,” says Kate Barraclough, Senior Lecturer of Finance and Faculty Director, MS Finance. “We want them to be able to deal with any type of problem that comes up and deal with it quickly and effectively. They may be starting at entry level, but they should be star performers.”
MS Finance versus MBA
For Maloney, the MS Finance program was not merely a stepping stone to an MBA. “In my field, sales and trading, it may not help to have an MBA,” he says. “Even if I do eventually become a manager, I don’t think I’ll pursue an MBA.”
He’s not alone. Students in the MS Finance program are “seeing it as a terminal degree and they’re not coming back for an MBA,” Barraclough says. “In the six years of the program, there have only been a handful who have come back.”
When compared to MS Finance students, those on the MBA track typically have a bit more job experience, with most pursuing the degree about five years into their careers. MS Finance students, on the other hand, tend to come with fewer than two years’ experience. “There is the benefit with the MS Finance that students don’t have to take two years off to go to business school and then come back to the job market,” Barraclough says.
While the comparisons to the MBA program may be obvious, there’s no sibling rivalry between the two. Students in both programs take classes together, and the MBA students often mentor those in MS Finance. In fact, the MBA program was somewhat responsible for MS Finance being developed in the first place.
“One of the benefits of going to a school like Vanderbilt is that the alumni are so great. Staying connected and keeping the program successful is an important way to give back, but I’m doing it because I think it adds value to my degree.”
—Zach Eskelson
“Having a smaller MBA program allowed us to expand our offerings through a portfolio of one-year master’s programs, including the MS Finance,” Barraclough says.
Besides filling an important niche among specialized postgraduate programs, a one-year degree in finance makes sense because Owen is well-stocked with professors who are among the world’s leading experts in the field. The close alignment with the MBA program, however, causes some confusion over which degree a student should pursue.
One rule of thumb for deciding is the student’s career goal: “If someone comes to us with a few years of work experience wanting a less specific finance education or a job in consulting, we’ll typically suggest the MBA path,” Barraclough says. “Do they want a more generalist business education so that they can move into a higher position, or a targeted master’s and an entry-level position? That’s usually the determining factor.”
The MS Finance program also can be useful in switching career focus. Zach Eskelson, MSF’07, Assistant Vice President at Redwood Trust near San Francisco, had worked in account management but found that he wanted a more quantitative finance role. “I started looking at job opportunities and educational options and decided, based on what I wanted to do and my experience, that MS Finance was a better fit for me,” he says.
Master’s degrees in finance are growing in popularity at colleges and universities throughout the country. “It seems like every week we’ve got a new competitor,” Barraclough says. Yet Vanderbilt made Eskelson’s list even though he graduated from the University of Washington in Seattle. He had visited Nashville several times before, and all it took was an official visit to campus to help him make up his mind.
“My decision was made,” he says. “The program is part of the business school. I wasn’t attracted to programs where they were part of the math or engineering schools. The fact that some of the classes were MBA classes—that attracted me. I’d be getting that exposure. There were only a few schools that had that.”
Access to the Very Best
Most students who enroll in the MS Finance program have received their undergraduate degrees elsewhere. In fact, only five of the 41 in last year’s class had attended Vanderbilt for their undergraduate studies.
“Our students tend to come from all over,” Barraclough says. “Students are attracted to the Vanderbilt brand and the strength of our alumni network.”
Kate Barraclough, Faculty Director of MS Finance, has helped the program fill a niche among specialized degrees offered at Owen.
In addition to Vanderbilt’s overall reputation, it helps that students have access to professors who have authored landmark studies on virtually every aspect of finance. For example, the faculty includes Bob Whaley, the Valere Blair Potter Professor of Management in Finance and Co-director of the Financial Markets Research Center. Among his many industry innovations is the development of the Market Volatility Index (VIX) for the Chicago Board Options Exchange.
“The classroom was generally a really interactive environment,” says Tony Cox, MSF’09. “It was really challenging, so we had to have a lot of interactions outside normal class hours or just talking to faculty in their offices. That kind of interaction was helpful. Being able to pick their brains whenever I wanted was definitely a great part of the experience. Bob Whaley’s class was one that I wanted to take just because he was teaching it. Having the opportunity to be around those people every day made Vanderbilt stand out.”
For Cox, a Financial Analyst with Goldman Sachs, another valuable benefit of a Vanderbilt education is access to the alumni network. “I know I wouldn’t be at Goldman without it,” he says. A graduate of the University of Kentucky, Cox connected with a fellow Kentucky alumnus who had received a master’s from Vanderbilt. Though the two had both schools in common, it was the Vanderbilt alumni network that connected them. “That’s how I was introduced to him and to Goldman and the office here in Atlanta,” he says. “Without that, I don’t think I ever would have had the opportunity to get the job here.”
“The program is a really short runway. Students can come out of undergrad pretty green, and in a short time they have to become accustomed to grad school and be ready to go into the job market.”
—Kate Barraclough
Cox represents his class as an Owen Alumni Council representative to ensure that the network remains helpful for those who follow. “Coming in, one of the things that I heard about Vanderbilt was the alumni network was really strong, and not just that they had a lot of alumni at great places, but there was a huge sense of community and people willing to return your calls,” he says. “The alumni network was a big drawing point for me, and I think it will be a big selling point going forward. If someone’s looking at any number of great schools, being able to show that you have an alumni network that’s willing to help you out, that’s something that you can use to compete against anyone. That’s the best resource you can have. It helps to keep the school strong and helps the school recruit.”
Eskelson, an Alumni Council representative for the Class of 2007, agrees. “One of the benefits of going to a school like Vanderbilt is that the alumni are so great,” he says. “Staying connected and keeping the program successful is an important way to give back, but I’m doing it because I think it adds value to my degree.”
Pursuing a master’s degree in what amounts to nine months creates an intensity, with every minute made to matter. It also forges deep relationships that carry on for years after graduation. “At University of Kentucky, it was easy to go through and not make a lot of connections,” Cox says. “Part of it was that you went from semester to semester and may never have had another class with someone. At Owen we had classes with the same people all the time. You really had to rely on your fellow classmates to make it through.”
Exposure to MBA students also makes a big difference, both inside the classroom and in extracurricular activities like the Owen Finance Club, which offers programming specifically for MS Finance students. Since many of the MBA students have had several years of work experience, their insight as mentors and career coaches is particularly valuable.
“Coming out of an undergraduate program and into a master’s is a different teaching environment,” Barraclough says. “Being in a classroom with a group of people who have, on average, five years under their belts is a wonderful experience for MS Finance students. They get a different style of learning, and they’re exposed to people with some background in their areas of interest.”
Ready for the Working World
Students in the MS Finance program usually fall into two categories: economics and finance undergraduates who want to differentiate themselves in the job search, or liberal arts majors wanting to home in on a career. The first semester follows a core curriculum, while the second allows a student to specialize in an area of finance based primarily on where they’d like to work, such as in corporate finance or at an investment firm.
Much of the academic year is devoted to the job search process. In fact, for many the job search often begins much earlier. Owen’s Career Management Center is in contact with students before they arrive on campus, and quite a few pursue internships the summer before classes start.
Sheila Swedberg landed a position as a Financial Analyst at Caterpillar Financial Services more than six months before graduation.
Sheila Swedberg, MSF’12, didn’t start quite that early, but might as well have. After receiving a bachelor’s in business from Boston University, she worked in accounting at a university for two years—long enough to determine she didn’t want that as a career. Arriving at Vanderbilt in mid-August 2011 (MS Finance students come two weeks early to plan for courses and career preparation), she immediately set to work on finding a job.
“We were told that there has to be an equal balance of school work, personal life and job search,” she says. “You can’t put too much effort in one area. That approach was new to me. When I’ve been in school, the message has been, ‘Focus on school work. Everything else will work out later.’”
Swedberg took advantage of the exposure to MBA students and the Owen Finance Club. She also participated in mock interviews through the club and set goals for herself, which she then emailed to the CMC’s career coach assigned to MS Finance students.
By November 2011—more than six months before graduation—she had landed a position as a Financial Analyst at Caterpillar Financial Services in Nashville. “There’s a lot of emphasis on networking, which was somewhat new to me,” Swedberg says. “I was terrible at it before, but it became a process of learning how to talk to people, making connections, reaching out and hoping that something will materialize from it.”
The MS Finance program is perhaps best described as a “really short runway,” says Barraclough. “Students can come out of undergrad pretty green, and in a short time they have to become accustomed to grad school and be ready to go into the job market.”
With such a rapid turnaround, every interaction with students matters—and translates into the working world. For Cox, it was the emphasis on communications. “The curriculum stressed it so much early on, from orientation and all the way through the first set of classes,” he says. “It was one of the biggest insights I got.”
He also gained technical skills, like something as simple as using Excel, which has helped him in his work. And then there is the intangible aspect that comes with the confidence of being able to engage in high-level discussions with fellow students and professors. “Because it was such an interactive and dynamic environment, being able to take the things that we were learning and turn them into a conversation was hugely helpful,” Cox says. “I interact with clients every day where I’m able to take what we see in the markets and distill it.”
For Eskelson, working at a small boutique firm has required virtually every aspect of his degree. For instance, the accounting courses have provided a high level of understanding about financial statements. “That has probably been the one single skill that lots and lots of people with high titles don’t have. Understanding complex financial instruments and being able to talk intelligently helped me get the job. It’s not that I can come into the job and do it immediately, but it is valuable being able to understand what, to most of the world, is very opaque.”
Vanderbilt MS Finance graduates may not be ruling the world of finance just yet, but they’re working their way up the ladder, reaching a hand behind to help those a few rungs below on the alumni network.
“Most of the people in my class have been lucky and have had some success in their careers over the last couple of years,” Eskelson says. “If I were to look for another job, that would be one of the first resources I would reach out to. I know people keep in touch and let each other know when they’ve moved. If someone came to me, I’d try to help them out, and other people would do the same.”
After graduating with a bachelor’s degree in engineering and economics in 2011, Tim Maloney decided to stay at Vanderbilt for one more year. Having a master’s in finance, he believed, would be an important differentiator in a difficult job market.
