Mark Jeffery - Faculty - Kellogg School of Management

Mark Jeffery

TECHNOLOGY INDUSTRY MANAGEMENT
Senior Lecturer of Technology Industry Management

Overview
Vita
Research
Teaching

Mark Jeffery is the Director of Technology Initiatives in the Center for Research on Technology and Innovation at the Kellogg School of Management. His research, teaching, and consulting focuses on enterprise performance management, unlocking business value from marketing and IT, and customer relationship management (CRM) strategy and execution. Mark has an active research program at Kellogg and has recently surveyed 252 Fortune 1000 firms on strategic marketing performance management, capturing $53 billion of marketing spend. He has also previously surveyed 179 Fortune 1000 firms and 44 Federal Government agencies on IT management best practices, capturing $70 billion of IT spend.

Mark directs multiple Kellogg executive programs including Managing Customer Relationships for Profit and Driving Strategic Value from IT. He also teaches the Kellogg executive MBA course Strategic Data Driven Marketing, and in custom executive programs at organizations including Microsoft, DuPont, Sony, Nissan, Phillips, and the CIA. In 2008 Mark launched the Kellogg Technology Network, an intense knowledge sharing forum for CIO/CTO and VP level executives.

He has more than 30 publications in scientific and technology journals, and three book chapters including the chapter on return on investment analysis in the forthcoming Wiley 2008 Handbook of Technology Management. Mark has also developed 22 original case studies distributed through Harvard Case Publishing. His most recent academic research publications are on the value of flexibility and using real options for enterprise technology project risk management.

Consulting clients include Microsoft, Intel, Waste Management, Teradata, Blue Cross Blue Shield Association, AAA Northern California, CCCIS, US. Department of Veterans Affairs, and the US.Navy e-Business Operations Office.

He holds a Ph.D. in theoretical physics from Drexel University (1991) and an MBA from the Kellogg School of Management (2001).

Areas of Expertise

Information Systems
Information Technology
Portfolio Management
Technology
Technology Infrastructure

Recent Media Coverage

Crain’s Chicago Business: Sci-finance - 5/25/2009

Chicago Tribune: Spritz on some savings with perfume bargains - 2/8/2009

Chicago Tribune: Cheap perfume: How to find it - 1/11/2009

Chicago Tribune: The sweet smell of a bargain - 12/7/2008

See all Kellogg in the Media

Recent Kellogg News

Kellogg Technology Network brings together IT executives for summit - 5/12/2008

See all Kellogg News

Education

MBA, 2001, Northwestern University

PhD, 1991, Theoretical Physics, Drexel University

MS, 1989, Theoretical Physics, Drexel University

BS, 1988, Theoretical Physics, Drexel University

Research Interests

Strategies and best practices of incorporating e-business technology in established corporations,developing metrics for measuring the value of technology investments

Articles

Benaroch, Michel, Mark Jeffery and Robert Kauffman. 2007. Option-Based Risk Managment: A Field Study of Sequential Information Technology Investment Decsions. Journal of Management Information Systems. 24(2): 7-12.

Jeffery, Mark and Saurabh Mishra. 2007. Strategic Marketing Performance Management: Challenges and Best Practices.

Bond, David and Mark Jeffery. 2007. The New Marketing - IT Power Partnership: Insights and Ideas on Creating New Value, Speeding Growth, and Overcoming Common Obstacles.

Monteiro, Sheldon and Mark Jeffery. 2006. Missing Millions: Unlocking Strategic IT Value.

Benaroch, Michel, Sandeep Shah and Mark Jeffery. 2006. On the Valuation of Multi-Stage IT Investments Embedding Nested Real Options. Journal of Management Information Systems. 23(1): 239-261.

Jeffery, Mark and Ingmar Leliveld. 2004. Best Practices in IT Portfolio Management. MIT Sloan Management Review. 45(3): 41-49.

Reprinted in:

Sloan Management Review, 2004.

Working Papers

Jeffery, Mark, Saurabh Mishra and Alexander Krasnikov. 2008. Firm Marketing Strategy Implementation Capability: The Construct, Link to Firm Performance, and the Role of Technology.

Book Chapters

Gershbeyn, Alex, Mark Jeffery and Derek Yung. Forthcoming. "Case - A&D High Tech Case B: Managing Scope Change.".

Jeffery, Mark. Forthcoming. "Return on Investment Analysis." In The Handbook of Technology Management, edited by Hossein Bidgoli, John Wiley & Sons.

Jeffery, Mark. 2004. "Return on Investment Analysis for e-Business Projects." In The Internet Encyclopedia, edited by Hossein Bidgoli, John Wiley & Sons.

Other

Jeffery, Mark and Philip Goldstein. "IT Portfolio Management for Colleges and Universities: Balancing Risk/Return for Strategic Results." EDUCASE Center for Applied Research, Research Bulletin.

Cases

Jeffery, Mark. 2002. Case Teaching Note: Sun Microsystems and the N-tier Architecture..

Jeffery, Mark. 2002. Case Teaching Note: Transmeta's Magic Show Case..

Jeffery, Mark, Derek Yung and Alex Gershbeyn. 2006. A&D High Tech (A): Managing Projects for Success. Case 5-404-763(A) (KEL156).

Jeffery, Mark, Derek Yung and Alex Gershbeyn. 2006. A&D High Tech (B): Managing Scope Change. Case 5-404-763(B) (KEL158).

Jeffery, Mark, Lisa Egli, Jessica Lambert, Liz Neely, Andy Gieraltowski, Jason Miller and Rakesh Sharma. 2009. Air France Internet Marketing: Optimizing Sponsored Searches. Case 5-407-753 (KEL319).

Jeffery, Mark, H Nevin Ekici, Cassidy Shield and Michael Conley. 2006. AMG Inc. & Forsythe Solutions: Lease vs. Buy Decisions. Case 5-404-762 (KEL217).

The AMG Inc and Forsythe Solutions case examines the lease versus buy decision for investments in technology. The case addresses pivotal investment decision issues such as varying the length of the lease, the useful life of the equipment, and alignment with the company’s overall financial strategy. The scenario is for a real financial services firm that has been disguised of confidentiality reasons. The case poses the student with an investment decision; should the company buy or lease technology with a relatively short useful life? The new controller at AMG Inc., a Fortune 500 financial services firm, has been tasked with determining how to finance the acquisition of 7,542 new PCs to be rolled out over the next twelve months. This is a $6.7M investment decision and the roll out schedule adds significant complexity to the case solution. The controller must chose between buying or leasing the computers over 24- or 36-month time frames. Completion of the case gives students a framework for analyzing similar investment decisions. The key learning point of the case is that leasing information technology can be cheaper than buying. This is contradictory to a car lease that students may be familiar with in their everyday experience. A new car has a potentially long useful life and can retain significant value after several years. Hence, a student’s intuition is that buying should always be cheaper than leasing. The AMG case shows that this is not the case for information technology. Students also learn the correct application of the mid-quarter convention within MACRS depreciation for technology, and the implications of operating versus capital leases and off-balance sheet financing. In the process, students will familiarize themselves with the four tests for a capital lease. Finally, the students will see how creative analysis techniques can be utilized to simplify complex decisions. These techniques will enable the student to arrive at a conclusion faster and with less effort.

Jeffery, Mark, Derek Yung, Joseph Norton and Alex Gershbeyn. 2006. Ariba Implementation at MED-X: Managing Earned Value. Case 5-404-763 (KEL224).

Jeffery, Mark, Tim Riitters and James Anfield. 2006. B&K Distributors: Calculating Return on Investment for a Web-Based Customer Portal. Case 5-404-764 (KEL149).

Jeffery, Mark, Derek Yung, Joseph Norton and Alex Gershbeyn. 2006. Clothes ‘R’ Us Point-of-Sale Initiative: Managing IT Programs. Case 5-404-765 (KEL304).

Jeffery, Mark, Robert A Cooper and Debarshi Sengupta. 2007. Danaka Corporation: Growth Portfolio Management. Case 5-306-511 (KEL300).

Cooper, Robert A and Mark Jeffery. 2008. Danaka Corporation: Healthcare Solutions Portfolio Management. Case 5-108-006 (KEL363).

Jeffery, Mark and Justin Williams. 2007. DuPont NASCAR Marketing. Case 5-107-014 (KEL166).

Jeffery, Mark, Scott Buchanan and Robert A Cooper. 2006. DuPont Tyvek®: Commercializing a Disruptive Innovation. Case 5-306-510 (KEL194).

Jeffery, Mark, Susan Deutsch and Paolo Cuomo. 2004. Technical Note: Lease vs. Buy Decisions for Technology . Case 7-404-753 (KEL263).

Jeffery, Mark, Ichiro Aoyagi and Ed Kallett. 2006. Marketing @ Microsoft: The Value of Customer Perception. Case 5-106-004 (KEL189).

Jeffery, Mark, Derek Yung and Joseph Norton. 2006. MDCM, Inc. (A): IT Strategy Synchronization. Case 5-404-770(A) (KEL170).

Jeffery, Mark, Derek Yung and Joseph Norton. 2006. MDCM, Inc. (B): Strategic IT Portfolio Management. Case 5-404-770(B) (KEL172).

The MDCM, Inc. (B): Strategic IT Portfolio Management case examines the steps involved in developing a portfolio of IT projects aligned with a company’s strategic objectives. Specifically, the case describes a situation where a firm has launched a transformation strategy but has yet to develop a complementary IT strategy. Students must select the optimal portfolio of projects aligned with the strategic objectives and define the global project execution strategy. The projects have both risks and dependencies. U.S.-based MDCM, Inc. specializes in medical device contract manufacturing and assembly. For the past five years, MDCM had grown by making over twenty acquisitions of companies based outside of the United States. This growth strategy enabled MDCM to better match its services to its customers who have become larger and more global. In MDCM, Inc (A) the CIO of MDCM, needed to determine the company’s IT strategy and objectives. In doing so, he needed to ensure that they were properly aligned with the company’s overall strategy and the new organization developed under an initiative called Horizon 2000. In a lecture prior to the cases, students were introduced to the framework of IT portfolio management and how it can help in focusing IT efforts. In MDCM Inc (B) the CIO has performed an audit of the MDCM’s IT and found twelve projects that are potential investment candidates for the next three years. The challenge for the IT Portfolio Management team is to identify the priority and appropriate sequence of investments to be made. The case assumes that students have knowledge of corporate IT. More specifically, the case is targeted for those who are or plan to become executives who would manage IT strategy and IT investment decisions either directly or in an oversight role. This case is the second case in a series; the first of the series is the case MDCM, Inc. (A): IT Strategy Synchronization. These cases were originally developed for the Kellogg executive program Driving Strategic Results through IT Portf

Jeffery, Mark and James Anfield. 2009. Outsourcing at Office Supply Inc.. Case 5-107-013 (KEL308).

Jeffery, Mark, Robin Barnes and Chuck Olsen. 2006. ProSight: New Millennium Financial Technology Portfolio Management. Case 5-404-771 (KEL191).

Jeffery, Mark, Robert J Sweeney and Robert J Davis. 2006. ROI for a Customer Relationship Management Initiative at GST. Case 5-404-766.

Jeffery, Mark, Nancy Kulick, Tim Riitters, Scott Abbott, Douglas Papp, Tiffany Schad, Jed Wallace and Jeff Weimann. 2006. San Diego City Schools: Enterprise Resource Planning Return on Investment. Case 5-404-772 (KEL174).

Jeffery, Mark, H Nevin Ekici, Cassidy Shield and Michael Conley. 2006. Shilling & Smith Acquisition of Xteria Inc.: Data Center Technology Leasing. Case 5-404-773.

The case centers on Shilling & Smith’s acquisition of Xteria, Inc. and the resulting need to quickly scale their IT infrastructure to accommodate the acquisition. The case is based upon a real leasing problem faced by a major retail firm in the Chicago area, as they purchased a small credit card processing firm and scaled the operations to handle the retail firm’s credit card transactions. In the actual case the new leasing contract was in excess of $50 million; in order to make the numbers manageable for students the scale of the leasing deal has been reduced to approximately $7 million. The Shilling & Smith case examines how to evaluate different lease options when acquiring data center information technology infrastructure. Specifically, the case addresses software versus hardware leasing, different lease terms, and how to choose between different lease structures depending on the strategy and needs of the company. This case enables students to understand the different types of technology leases and what situations these leases would be employed. Three different lease scenarios are given explicitly in the case: 1. Lease everything over a 36-month term. 2. Lease the hardware only over either a 24-month or 36-month term and purchase the software and professional services. 3. Lease the high-end upgradeable servers (HP Keystone servers) for 36 months, lease the data storage and web servers (EMC and HP Netservers) for 24 months, and purchase the Cisco network equipment, all the software and the professional services. The case also alludes to a fourth scenario, which is the option of a step-up lease whereby the lease payments are delayed six months to match the cash flows of the company. The CIO of Shilling & Smith needs to determine which lease option is the best means of providing the technical infrastructure needed to support Shilling & Smith after the acquisition of Xteria. Several issues drive this decision, including the value and useful life of the equipment, as well as the strategic context of the firm.

Jeffery, Mark and Saurabh Mishra. 2006. Sony-FIFA Partnership Marketing Program: The Value of Sponsorship. Case 5-206-250 (KEL195).

Jeffery, Mark, Lisa Jackson, Derek Yung, David Bibbs, Michael Dowhan, Daniel Grace, Woody Maynard and Steven Johnson. 2006. Supply Chain Outsourcing at DB Toys. Case 5-404-767 (KEL256).

Jeffery, Mark, Robert J Sweeney and Robert J Davis. 2006. Teradata Data Mart Consolidation Return on Investment at GST. Case 5-404-774 (KEL196).

Jeffery, Mark, Robert J Sweeney, Chris Rzymski and Sandeep Shah. 2006. The Value of Flexibility at Global Airlines: Real Options for EDW and CRM. Case 5-404-768 (KEL266).

Technology projects are inherently risky; research shows that large IT projects succeed as planned only 28 percent of the time. Building flexibility, or real options, into a project can help manage this risk. The management flexibility of options has value, as the downside risk is reduced and the upside is increased. The case is based on real options analysis for an enterprise data warehouse (EDW) and analytic CRM program at a major U.S. firm (disguised as Global Airlines).

The data mart consolidation or the EDW marginally meets the firm's hurdle rate as analyzed using a traditional net present value (NPV) analysis. However, different tactical deployment strategies help mitigate the risk of the project, by building options into the project, and the traditional NPV is expanded by the real option value. Students analyze the different deployment strategies using a binomial model compound option Excel macro, and calculate the volatility using Monte Carlo analysis in Excel. A tutorial is provided to teach students how to accomplish the real options analysis for a simplified project, and this tutorial is easily generalized by students to the case scenario.

In addition to the tactical options, the case has a strategic growth option of analytic CRM. Students must analyze both the tactical and strategic growth options and make a management project funding recommendation and also recommend an optimal deployment strategy to manage the project risk. The case teaches real options for technology projects. Students learn how to calculate real option values, where the key input of volatility is obtained by Monte Carlo analysis in Excel. Students also learn that the real option value is "real," resulting from active management mitigating project risk and improving the upside. Most important, students understand the difference between tactical vs. strategic growth options and make a management recommendation on funding the project and also recommend an optimal deployment strategy to manage the project risk.

Teaching Interests

Foundations of technology and information management, and technology portfolio management

Full-Time / Part-Time MBA

Strategic Data-Driven Marketing (MKTG-952-0)

This course counts toward the following majors: Technology Industry Management.

In today’s environment, Chief Marketing Officers require tools and techniques to both quantify the strategic value of marketing initiatives, and to maximize marketing campaign performance. This course is designed to help marketers demonstrate the return on investment (ROI) of marketing and leverage data from marketing analytics to make better and more informed marketing management decisions. The course covers marketing performance management, marketing measurement, marketing ROI, customer value based segmentation, customer lifecycle management, internet search engine marketing optimization, data mining segmentation, analytic marketing, and strategic marketing data creation. Students are introduced to typical data mining techniques for marketing, have access to real data sources, and will conduct hands-on marketing analysis using data mining tools. This class counts towards the Marketing and Marketing Management major.

Information & Technology Based Marketing (MKTG-953-0)

This course counts toward the following majors: Marketing, Marketing Management.

Marketing is evolving from an art to a science. Many firms have extensive information about consumers' choices and how they react to marketing campaigns, but few firms have the expertise to intelligently act on such information. In this course, students will learn the scientific approach to marketing with hands-on use of technologies such as databases, analytics and computing systems to collect, analyze, and act on customer information. While students will employ quantitative methods in the course, the goal is not to produce experts in statistics; rather, students will gain the competency to interact with and manage a marketing analytics team.

Enterprise Technology for General Managers (formerly TECH-914-0) (TECH-442-0)
This course gives managers essential skills for executive oversight of enterprise technology, which is a significant component of most business initiatives. Topics covered include return on investment (ROI) for e-bus iness projects, enterprise resource planning (ERP) deployment best practices, ERP ROI, marketing resource management (MRM), customer relationship management (CRM), enterprise data warehousing (EDW), analytic marketing, strategic outsourcing, project management, and information technology portfolio management. Class lectures are complemented by real-life case discussions of strategic and management issues for enterprise technology, and include cases on leading technology companies such as Google, Cisco, and Microsoft. TECH-442 is the core requirement for the Technology Industry Management major. Students with exceptional enterprise technology experience may request a waiver by sending their resume and a brief statement of experience to Prof. Mark Jeffery at mjeffery@kellogg.northwestern.edu.

Enterprise Technology for General Managers (TECH-914-0)
This course gives managers essential skills for executive oversight of enterprise technology, which is a significant component of most business initiatives. Topics covered include return on investment (ROI) for e-business projects, enterprise resource planning (ERP) deployment best practices, ERP ROI, marketing resource management (MRM), customer relationship management (CRM), enterprise data warehousing (EDW), analytic marketing, strategic outsourcing, project management, and information technology portfolio management. Important technologies and trends are also discussed including Web 2.0, Web Services, Linux, and e-business and enterprise architectures. Class lectures are complemented by nine real-life case discussions of strategic and management issues for enterprise technology. TECH-914 is the core requirement for the Technology Industry Management major. Students with exceptional enterprise technology experience may request a waiver by sending their resume and a brief statement of experience to Prof. Mark Jeffery at mjeffery@kellogg.northwestern.edu.

Managing Technology Portfolios and Projects (TECH-922-0)
Synchronizing enterprise technology, innovation, marketing, and growth investments with corporate strategy is a major challenge for many firms. This course teaches the essential executive skills of portfolio and project management and is designed for prospective consultants, technology, marketing, product, finance and general managers. The course incorporates real-life case studies that span the product life cycle, and students work together in teams to develop case solutions. Specific cases include return on investment (ROI) analysis of customer relationship management (CRM) systems, real options applied to CRM for strategic and tactical decision-making, earned value program oversight, risk management, innovation management, growth portfolio management, and strategic portfolio optimization for mergers and acquisitions. Four of the cases include hands-on learning with software tools: Students use @Risk for Monte Carlo simulations of project ROI and real options calculations, and use Microsoft Project for a hands-on case assignment to turn around a project in trouble. Students also use ProSight Portfolio software for a simulation of a complex strategic IT portfolio management decision following the merger of two financial institutions. Senior executive speakers complement the case discussions.

Executive MBA

Strategic Data-Driven Marketing (MKTGX-455-0)
In today’s environment, Chief Marketing Officers require tools and techniques to both quantify the strategic value of marketing initiatives, and to maximize marketing campaign performance. This course is designed to help marketers demonstrate the return on investment (ROI) of marketing and leverage data from marketing analytics to make better and more informed marketing decisions. The course covers marketing performance management, customer relationship management strategy and execution, strategic marketing measurement, and analytic marketing and value driven segmentation. Content covered is especially applicable to those covering broad customer connection initiatives and those leveraging the use of CRM infrastructure.

CONTACT INFO:
PHONE: 847-467-5509
FAX: 847-467-5505

EMAIL:
mjeffery
@kellogg.northwestern.edu

OFFICE:
Jacobs Center Room 5248