Thursday, May 17, 2012

Joann Farrell Quinn: What are you going to do with your PhD?

I cannot begin to count the number of time people, from close friends to new acquaintances, have asked me this question. When I went back to school for my MBA, with a decade of work experience behind me, I was often asked this question, and found no issue in quickly responding. I often explained that as I moved into leadership, I often wondered if what I was doing in my own role corresponded with what ‘I should be doing.’ I was hoping that getting an advanced degree, specifically the MBA, would help me in clarifying what best practices were and how I could be most effective. Well, as it turns out, I am still looking at the same underlying issues, but now my focus is turned outward. How can I assist others in being more effective? The experience of working toward my doctorate as a member of a professional and experienced cohort has been such a great growth experience for me. Even if I never told anyone that I had the degree, or even used it professionally, it would still be worth its weight in gold. The connections that I have made during the program have been really wonderful- personally and professionally. So, after three years in the program I now know how to answer the question—the answer to the question is that it is not about what I am going to do with the degree, it is about what I have gotten out of my participation in the DM program. It provided me with valuable learning opportunities and relationships that I would not otherwise have. I always say that life is an evolution, and this experience has added to my evolution.
Joann Farrell Quinn is Owner of JFQ Consulting and Adjunct Professor at the University of South Florida Polytechnic. Her research examines how emotional and social competencies, positive relationship and role/identity construction impacts individual performance in organizations. Joann is a doctoral candidate in the PhD in Management: Designing Sustainable Systems program at the Weatherhead School of Management at Case Western Reserve University.

Thursday, May 10, 2012

Moraima DeHoyos-Ruperto: Is the networking the missing link in entrepreneurial success?

Scholars point toward the importance of creating networks as a noteworthy element for entrepreneurial success. But, may this be the missing link without which we cannot be successful in our entrepreneurial endeavors?

In fact, most of the experts in the field highlight the positive effect of networking for a business’s start-up and sustainability.   However, others question this by stating these relationships may destroy the likelihood for success of a business, instead of helping it.   

In view of this dilemma I wonder: is the creation of networks and the relations these entail so powerful, to the point of being capable of defining the success and/or failure of an entrepreneur? Furthermore, is it the relations per se, or is it with whom, when, how and for what means these relations are built that is important? Or is it our openness and flexibility towards creating new relations?  What is it in the creation of networks that can really make the difference? Or, is the business’s success and/or failure disjointed from the people and institutions that the entrepreneur relates him/herself with?

In my study, for example, I found that entrepreneurs’ relationships with other individuals and institutions seems to play an essential role in the success and/or failure of businesses in Puerto Rico.  So much so that I was able to identify differences in the type and use of networks between successful entrepreneurs and non-successful ones. In addition, through my quantitative research, I was able to observe that the individual relationships that entrepreneurs are establishing, instead of helping towards the positive development of the firm performance, are being detrimental.  Also, we could corroborate that most entrepreneurs do not search to establish relationships with entrepreneurial institutions and depend principally on their private/close network, which mainly includes friends and family members. 

This leads us to think whether or not there is a truly key role from the part of entrepreneurial networking as to entrepreneurial success. And even if we cannot solely attribute the success and/or failure of an enterprise to this specific factor, I think that we should better understand entrepreneurs’ networking processes and inquire about their true effect, if any, on the success and/or failure of a business. What do you think?

Moraima DeHoyos-Ruperto is a Professor of Business Administration in the University of Puerto Rico – Mayaguez.(http://www.uprm.edu/about/indexen.html)   She is currently the Program Advisor for “The Key for Your Business” of the Puerto Rico Trade Office.  Moraima is also a Doctor of Management (DM) candidate at Case Western Reserve University.

Tuesday, May 1, 2012

Nnaoke Ufere: “Alcohol Made Me Do It”: Rationalizations and CEO Corrupt Behavior

Albert "Jack" Stanley, the 65-year-old chairman and CEO of KKR, a senior executive at Halliburton, was legendary for winning billion-dollar contracts in emerging countries; he seemed to possess a magic wand for dealing with government officials and winning their trust in countries like Egypt, Malaysia, Nigeria and Yemen. Those who know Stanley well describe him as a smart and fearsome competitor, intent on winning big deals and getting rewarded for his contributions. His dedication to Halliburton was unquestionable and he was considered a global rainmaker. He had it all. But all that changed on one private trip to Abuja, Nigeria.
When Stanley boarded the flight to Abuja, Nigeria, little did he know that the fateful trip would not only end his winning ways and prestigious career, but also would send him to prison for 30 months, plus $10.8 million in restitution payment. Mr. Stanley, according to federal prosecutors, made the clandestine trip to meet with senior Nigerian officials to figure out who to bribe and how much to pay. The agreed $182 million bribery greased the palms of Nigeria procurement officials who reciprocated by awarding a lucrative contract worth more than $6 billion to Halliburton. Nigeria officials rewarded Stanley with “kickback” in the amount of $10.8 million. But Stanley violated the Foreign Corrupt Practices Act of 1977, which forbid US-based companies from paying bribes to government officials abroad. The case went to trial and Stanley was convicted of bribery.
On the sentencing day on February 23, 2012, according to the Wall Street Journal, Mr. Stanley told Judge Keith Ellison that his decision to bribe Nigerian officials was fueled by "ambition, ego and alcohol". His rationalizations notwithstanding, the judge sentenced him to 30 months in prison and ordered him to refund the $10.8 million he received from the deal. Halliburton also settled with the US government and paid $579 million in penalties.
Mr. Stanley’s bribery behavior is not an isolated case nor is his use of “alcohol-made-me-do-it” rationalization strategy to justify criminal act atypical. According to case files on the Department of Justice and SEC websites, several multinational corporations (MNCs) have pleaded guilty to similar crimes – Johnson & Johnson, IBM, Shell, Baker Hughes, ABB, Siemens, Tyson Foods, Vetco, Wal-Mart (case pending), etc.
Finding from our research on supply-side corruption (those who pay bribes purposively for self-interested benefits) directly implicates CEOs as active perpetrators of corrupt practices. Our finding shows that a CEO’s corrupt behavior is shaped by four important factors. First, the host country’s institutional environment which creates opportunities for corrupt behavior by providing incentives and a moral free zone where CEOs rationalize and justify corrupt behavior as normative - the way business is done in the host country. Second, CEO’s motivational desires to achieve company and/or personal goals when the benefits of doing so exceed the costs. Third, the private payoff that accrues to the CEO. Fourth, a board of directors that explicitly or implicitly support and reward behaviors that promote corrupt practices or fail to take action when corrupt practices come to light.
When we examine Stanley’s case from the lens of self-interest used in our studies, we find a rational actor whose corrupt practices were guided in part by his motivational desires to achieve both organizational goals (lucrative $6 billion contract award) and personal reward ($10.8 million in kickback). One of the most intriguing findings from our research is that corrupt CEOs tend not to view themselves as corrupt. They tend to acknowledge their corrupt behaviors but at the same time rationalize it in ways that make them appear to be normal and acceptable business practice in their host countries.
Nnaoke Ufere is the Chief Executive Officer for iServiceX, Inc. in Atlanta, Georgia. He is also in the Ph.D. in Management: Designing Sustainable Systems program at the Weatherhead School of Management at Case Western Reserve University and can be reached at nufere@iservicex.com. His research examines the nexus of entrepreneurial illegality and venture performance to offer an initial exploration of the illegal behaviors enacted by entrepreneurs in pursuit of venture success.