Willamette University

The Business End

By Erik Schmidt ’05

It’s almost noon in Southern California, and the sun shines unfiltered in an empty sky. This is a prototypical Californian spring day: To the east, the San Gabriel Mountains have warmed under a few hours’ light; to the west, the Pacific sparkles. Poolside, here, at a large conference hotel, a handful of Willamette economics majors are lying on their stomachs and trying not to think about numbers for a while.

They’re tired, but they can’t stay long. They have exactly 20 minutes to rest, and then they have to towel off, trot back upstairs to a darkened suite strewn with laptops and charger cords and deflated bags of potato chips, and make a significant business decision.

These upperclassmen, alongside peers from around the U.S. and a handful of other countries, are here for one warm spring weekend in Anaheim to attend the annual finale of the International Collegiate Business Strategy Competition (ICBSC). The culmination of a semester’s work, the event revolves around a business simulation that pits students against a sophisticated computer model, the market, and 28 teams of competitors. The competition’s directors are private-sector veterans and longtime academics, several of whom have been around since the simulation’s inception in 1965.

The six Willamette students are a high-functioning team. They are computer whizzes, effective public speakers, economic forecasters and analysts; they are also jokesters, beachgoers and friends.

But, unlike everyone else at the competition, they’re not business students.

Willamette is the only school involved that has no undergraduate business program. (There are just two other liberal arts colleges, and both have business as a cornerstone of their undergraduate curricula.) It’s been that way for some time, too, but Willamette, in the role of the pintsized underdog, has been consistently strong and occasionally dominant. The Bearcats won everything most recently in 2012, besting undergraduate business programs that important people consider pipelines for Wharton, the University of Chicago, Columbia Business School, and others. Over the years they’ve filled a wooden display case in Smullin Hall with enough engraved crystal trophies to weigh down a wheelbarrow.

And so, as the Willamette Six — Jamel Freeman ’13, Neal Rusk ’13, Josh Dean ’14, Paul Shoji ’14, Eva Sharf ’13 and Tana Watanabe ’14 — file up to their hotel room, sunbaked, they are propelled by precedent. Maybe they can feel the weight of it.

Rules of Engagement

The ICBSC is a complex simulation, but the key ideas are intuitive enough (no need to go into Altman-Z scores or ROI averages). The Willamette students comprise one of 29 teams. They, like everyone, have created a hypothetical company. Theirs is called Refresh Technologies and manufactures personal, portable water filters. Willamette competes in a “world” with five of the other teams’ companies; all the rest have their own worlds and their own products, though everyone is judged together on their overall performance for the most coveted awards at the end of the weekend.

Every student has a real job title and real responsibilities, and they’ve been learning them for a semester, during which they’ve interacted with the simulation from a distance. For each simulated (accelerated) fiscal quarter, the teams have to submit to the ICBSC directors a “decision” — this vocabulary will show up often — that includes changes to resource allocation, production levels, marketing expenses, pricing and other factors. Throughout the semester, each team has had two weeks to make each quarter decision. Here in Anaheim, they have two hours.

The water-filter market has proven to be crowded, and Refresh Technologies’ performance has been disappointingly average so far in the contest.

The group members’ first step now, in the hotel room, is to refresh their emails to read the results from the last decision they made, and then they’ll settle in to assess what’s next.

The news is shocking. Not only is the outlook poor (Refresh Technologies is slipping into a segment of the market it shouldn’t be in), but there is also an announcement from the simulation directors that a make-believe tsunami will soon strike the group’s foreign production site, rendering useless several new production lines they had, just hours earlier, begun to build there. They really needed those extra lines.

There are some crinkled facial expressions around the room, and choice words directed toward laptops. Even the sense of confusion — nobody said anything about natural disasters.

Then, as if a switch has been flipped, the students regroup. Their voices join in a dense conversation and ideas for responding come and go rapidly. Sometimes members affirm an idea right away and run with it; other times, a thought is met with the brief, shared silence that says, “Um, no.” Anyone within earshot of the conversation can tell, even if its content is mostly technical jargon, that this is an interesting team dynamic.

The clock ticks its way toward the next simulation deadline, which, presumably, will require much more brainstorming than normal, consensus, and a drastic change in approach.

There is one hour.

Precedents

The 2013 team members, one could say, are the curricular descendants of a man named Richard “Dick” Gillis. Gillis came to Willamette in 1957 and would serve the economics department for three decades, earning a legacy akin to that of Richard “Buzz” Yocom or Frances Chapple or Bob Hawkinson. Gillis was the original faculty advisor for the simulation program that would evolve into the ICBSC.

Former students remember his sense of humor, but they also recall shrinking in their chairs at the thought of being called on. “He always seemed to be having fun teaching,” says Jim Booth ’64, another Willamette leading man, “even though it was frightening to those in the class who weren’t prepared. If you weren’t prepared, you took the risk of being embarrassed.” Booth added a second major, in economics, after taking a class from Gillis.

Gillis’s expectations were uniformly high, as applied to his students and to himself, and he helped inform not just the character of his department but the worldview of the university. Evidence is everywhere: After Dale Mortensen ’61 received the Nobel Prize for Economics in 2010, he recalled Gillis’s influence as a close and perceptive mentor. Current students, even, receive a scholarship that carries Gillis’s name because donors have wanted to contribute to the old professor’s cause. His cause was his students above all else. (It’s worth pointing out that this writer was able to attend the 2013 ICBSC competition because of the Gillis fund.)

With Gillis’s departure in 1989, the reins of the business-simulation program went to professor Don Negri, then a junior member of the faculty. He has tended it since. Looking at the program with new eyes, Negri discerned that its alumni had begun to mature into their professional lives and had become especially successful. These were some of Willamette’s highest powered graduates, and their successes had never really been tracked or trumpeted outside the department.

The alumni continue to be united by a powerful shared experience. Shobi Dahl ’06, co-founder and CEO of Dave’s Killer Bread, remembers the experience as one of the best of his Willamette career.

“What I loved about it was that Don got us all pointed in the right direction and then just let us go and figure it out for ourselves,” he says. “We really built up a lot of teamwork, and it was very formative for us.” For his team, the competition was an exercise in adaptation and coping with setbacks.

“One round, our computer somehow submitted a blank file to the game operators, and when the next round started we all flipped out thinking that the operators had sent us a curveball in that round because our plants had not produced any bottled air (our company name was Breathe).

“Once we figured out it was just us, we all got angry for a minute, sad for a couple more, and then we pulled ourselves together and kept charging forward.”

Amazingly, Dahl’s team ended up taking second place in the competition, slip-up and all.

Jared Rieger ’09 lives in New York and works in investment banking. He, too, recalls the experience as one of the best of his Willamette career, and he says the group work — and the intensity — gave him professional momentum.

“We relied on each other’s expertise,” he says. “It had to be very collaborative. It was the first time I had done anything business- or finance-related, too — I had never looked at financial statements before the project, and now I do that every day. The competition made everything real and practical.”

Ashleigh Williams ’06, MBA’06 has made her way from investment analysis to buying and pricing for several large dot-coms. She summarizes the experience in practical terms:

“To this day, I follow the guys from the simulation course much more closely than other alumni because they’re all doing interesting things.”

Even Rusk, not yet graduated, received three competing job offers before Anaheim. Using alumni contacts, he identified three viable career tracks and might start by helping insurance companies manage their risk. He is confident, modest and grateful.

He certainly isn’t alone. Quietly, over the years, Negri has siphoned off the top prospects in each economics cohort and helped produce leaders. While every team is different and each year the simulation program evolves a little, one thing has been constant: Willamette’s companies routinely fight above their weight. Interestingly, another corner of Willamette provides clues as to why.

Teams

People who study team theory know that high-functioning groups succeed because of their composition and their relationships. They tend to have diverse skills, and they tend to interact well enough to share them. It’s deceptively tricky, however, to build a good team on the front end.

Larry Ettner, professor of management practice at the Atkinson Graduate School of Management and manager of its experiential PACE program (see The Scene, Spring 2011), knows how. “One thing we know in team theory,” he says, “is that if we know the various psychometric skill sets of the members, we can balance a team to make it more productive.”

He says that by using formal assessments (the Meyers-Briggs is one well-known example, but managers use others), leaders can combine diverse-but complementary personalities and aptitudes. An excellent team doesn’t require sameness among its members; it requires the right kind of difference.

So here’s one possibility already: Even though all the members of Willamette’s teams are declared economics majors, their success could stem from the fact that they are likely to be more “productively different” than other groups. Consider the built-in variety of this year’s team: A politics minor with a hankering for entrepreneurship. A varsity quarterback headed for teaching and coaching. A psychology double-major who studies human behavior. A mathematician headed for an MBA. A pragmatist who studied in Spain. A student of Japanese with international-relations savvy.

One of the other leading teams at this year’s competition is from Regent’s College in London, but it isn’t comprised of Londoners. In fact, five nationalities are represented among the six group members. Its CEO, Mikael Sletten, is from Norway and understands that the group’s composition is its asset.

“This has been an intercultural experience,” he says. “We know how to work as a team with different backgrounds, and we’re very attuned to our cultural differences. We feel the fatigue sometimes, but it helps us.”

Because of the limited number of eligible students each year, Negri starts with the ones with the best grades and encourages them to selfselect into team roles. But he doesn’t just ask them to sign up for whatever they want: They have to complete a test first.

It involves a visit to Negri’s house. The students are charged with planning and cooking a large dinner for themselves and Negri’s family, and Negri gives them precious little direction. They have to brainstorm, plan and execute on a ticking clock (and with their own appetites in mind). It’s quirky, but in some way it approximates the sorting that takes place in more formal selection processes. The students learn how to communicate; they settle into roles based on aptitude rather than aspiration; they learn to trust each other’s expertise because they have to. They learn, not accidentally, how to make collective decisions very quickly.

Decisions

Back at the hotel in Anaheim, the students are dealing with the tsunami. It threatens everything: the assembly lines, the several fiscal quarters worth of decisions they’ve made to lay the groundwork for expansion, and, when it comes down to it, the future of their company.

But now another message arrives. Due to some unforeseen system error, it says, the tsunami has now been canceled.

Immediately, Sharf, the big-picture person, wonders out loud about ways to turn this into a positive — to help her team bounce back from the confusion quicker than everyone else.

There are 18 minutes left until another decision is due. During two of those minutes, they decide whether or not to continue building the new production lines (they do).

In the span of a couple more they run projections of investments and revenue. They hit “send” inside the last minute. There are sighs of relief.

No matter what, this decision won’t save the competition for them — they’re too far behind by now — but it does give them a useful boost at the end, something to remember the weekend by. “If we leave here with nothing else,” Sharf says, smiling, “it’ll be that we can make a complicated decision together in 18 minutes.” It’s a point not to be underestimated.

Negri, prohibited from being present during the decision-making periods (so he doesn’t influence the group), now comes into the room. He surveys the scene, understands immediately what has just taken place, and smiles, as he tends to, at this relentless team.

“Tell me they’re not into it,” he says, tickled. There are grins all around

Outside, the sun is going down somewhere over the ocean. There won’t be any time for a dinner break because the tsunami glitch had required that an extra decision round be shoehorned into the evening’s schedule. It’s time, again, for Refresh Technologies to collect itself and move on.

There are two hours.

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Teammates

Jamel Freeman ’13
Vice President of Marketing. Politics minor.
Already manages his own financial-services business.

Neal Rusk ’13
Senior Forecasting Analyst. Psychology double-major with emphasis in behavioral economics.
Possible career in finance.

Josh Dean ’14
Vice President of Production. Willamette quarterback. Likely headed for teaching and coaching.

Paul Shoji ’14
Chief Financial Officer.
Math minor. Longboarder.
Is considering an MBA after graduation.

Eva Sharf ’13
President and CEO.
Politics minor. Studied in Spain. Wanted to test her economics training in a simulation setting prior to entering graduate school.

Tana Watanabe ’14
Senior Marketing
Strategist. Studies Japanese. Aspires to work in international business and international relations.


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At A Glance

International Collegiate Business Strategy Competition(ICBSC)

(Hypothetical) Company Profile:

Refresh Technologies
Market:
Portable, personal water filters
Countries of Production: Merika (pop. 260 million), Serino (pop. 80 million)


START>>

  • Each team devises a strategic "decision", including changes to resource allocation, production levels, marketing expenses, pricing and other factors. (2 hours)
  • Accelerated fiscal-quarter simulation runs. (30 minutes)
  • Results immediately delivered to each team

<<REPEAT


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"Tell me they're not into it," Negri Says

Economics professor Richard “Dick” Gillis came to Willamette in 1957. Professor Don Negri picked up the simulation where Gillis left off.