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Reality check

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Advice from the tech-connected

Boston College's second annual TechDay, which took place the afternoon of October 29, started with a litany of unhappy economic news intoned by Dan Nova '83, managing general partner of Highland Capital Partners, a Massachusetts-based firm that invests in technology start-ups. Unemployment, he said, was up by 50 percent in the last three years, real wages were down, the venture capital business "at a standstill," initial public offerings "basically shut down. . . . It's a good time," said Nova, who moderated the first of the day's two panels, "to be in school and not in the workforce," a point that may or may not have given comfort to the audience.

TechDay, according to its organizer, associate professor of information systems John Gallaugher, highlights topics from business uses of digital technology to ways of assessing the strength of high technology firms; it is sponsored by the Carroll School of Management MBA Technology Club and by the Tech Council, a Carroll School alumni group. This edition drew about 350 people, who filled the Fulton 511 auditorium to near capacity. The audience included some 40 alumni, identifiable, it seemed, by their dark business dress and their muted, businesslike demeanor. Also in the audience were numerous MBA students, a less reserved contingent that tapped away on laptop keyboards and was overwhelmingly dressed for school rather than the office. Interestingly enough, this contrast in styles also characterized the day's two panels.


DAN NOVA'S grim, stage-setting litany didn't seem to bother his panelists, who were chosen precisely because their companies had flourished in a bad economy. Philip W. Schiller '82, marketing chief at Apple Computers, cheerfully declared that he doesn't concern himself too much with nitpicking matters like his stock's price-to-earnings ratio. "What I care about," he said, "is how much fun I have when I get up in the morning, and whether my products make people happy." Recently, Schiller, a sandy-haired man in faded jeans, has been having fun unveiling, among other products, Apple's iPod digital music player, of which he declared sanguinely, "It's become a brand, as Kleenex is to tissues." Apple's strategy for dark times, Schiller said, is to "reinvent the personal computer around the digital lifestyle, what we call 'the iLife.'"

Also preaching fun, along with "excitement," as a key to profitability was panelist Carl Rosendorf, CEO of Smart Bargains, which sells consumer goods like bedsheets and luggage on-line. Describing his marketing strategy, he said, "Urgency is the key." The Smart Bargains Web site posts a countdown of the remaining units of each item being sold because, in Rosendorf's words, "As you get closer to zero, people are that much more likely to buy."

The Starbucks Coffee chain was represented by Kathleen Richardson, director of marketing for the northeast zone, who talked up the company's new Duetto Card, which combines a prepay feature with a Visa card that gives free coffee dividends. Quoted Richardson, "You may never have to pay for a latte again."

It was around this point in the proceedings that Nova tried to steer the panel back to the question: How do you make money in a terrible economy?

"In the end," Apple's Schiller answered, "if you build a good business, the valuation will come. . . . If Sony's laying off 20,000, we see it as an opportunity to pick up products that they dropped and hire some good people." Rosendorf, of Smart Bargains, also talked up the business opportunities in a bad economy, saying, "That's when retailers cancel orders from suppliers and we can get some of our best bargains."

Asked for any advice they had to offer future MBAs, the panel was silent for several beats. Then Schiller advised prospective business executives to look for a "product you're crazy about" and seek employment at the company that makes it.


COMPARED to Nova's panelists, none of whom had a business suit on, let alone a necktie, the members of the afternoon's second panel—five chief information officers, or CIOs, from large, established companies—were grayer and more traditionally dressed; and it was hard to imagine being crazy about several of their products, things like life insurance and commercial air conditioners, however crucial.

In a nuts and bolts discussion, Peter Burrows of Reebok International predicted that open-source operating systems "are going to do what the Justice Department didn't do: drive people away from Microsoft as [Microsoft] continues raising prices." On outsourcing of information technology (IT) jobs to places like China and India, a recent sore point for out-of-work IT professionals, Bill Oates '78 of the Starwood Hotels chain laid out the market realities, saying outsourcing "is huge for all companies now. If your competitors are doing it, they may be able to get more bang for their technology than you."

As for advice to future MBAs? Terry Conner of Liberty Mutual recommended cultivating the skill of "dealing with change—because that's the only constant we have in business."

David Reich


David Reich is a freelance writer based in the Boston area.

 

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