world is their classroom
GIM program helps solve pressing social issues with market-based
research and strategies
Piotr Pikul ’05
has long had an interest in the changes wrought by political
Pikul, a native
of Poland, has watched Eastern Europe struggle to adapt to
a market economy in the years since the fall of Communism.
He grew curious about the progress of South Africa in the
wake of a similarly transformative event: the end of apartheid.
Last spring, Pikul
seized a rare opportunity to take a firsthand look at South
Africa and its prospects. He and Kellogg School classmates
Kathy Wang ’05 and Craig Wynn ’04 visited the
country to understand how businesses can prepare black citizens
to become full participants in the South African economy.
an issue we thought was critical to South Africa,” Pikul
says. “To have a stable, successful society, you need
a prospering middle class. There are a lot of lessons to be
learned there for other emerging markets.”
was provided through the Kellogg Global
Initiatives in Management (GIM) course, which sends hundreds
of Kellogg students around the world on similar academic excursions
each spring. Since its founding in 1990, GIM has become one
of the school’s most popular courses and a cornerstone
of the Kellogg experience.
“We put the
first class together with no great vision of what it would
grow into,” says Sandy Haviland ’90, who spearheaded
the creation of GIM with a group research trip to the former
Soviet Union almost 15 years ago.
was simply to get us into places where things were happening,
to go beyond the academics and theory and really interact.
We’re incredibly proud and excited to see how the program
has grown,” says Haviland, now president of Haviland
& Co., a financial services firm in Connecticut.
helps to consolidate the learning in core Kellogg classes.
Students work in teams and develop their own projects with
the assistance of faculty advisers, interviewing politicians,
business leaders and consumers. Sometimes the projects tackle
a problem faced by a single industry or company, but last
year, many projects had a broader focus. Many students were
spurred to research social issues by the Ford
Motor Company Center for Global Citizenship. The Kellogg
School-based center offered prizes for the best papers on
social responsibility and environmental issues.
some of the thorniest issues faced by developing societies
— how to bring healthcare to the rural poor in Brazil,
for example, or how to minimize pollution in China while pursuing
with such topics helps students learn how to apply management
theories to actual business problems — one of the key
goals of the GIM program, says Mark
Finn, program director and clinical associate professor
of accounting and international business.
projects involve primary research and give students opportunities
to say something new and important about the countries they
visit,” Finn says. “The projects generally propose
practical solutions to real-world problems. However, the best
projects tend to make use of analytical frameworks —
from marketing, strategy or finance — learned in the
students’ Kellogg coursework.”
Pikul, Wang and Wynn took on a potentially vast issue: how
to close the skills gap in South Africa so that the historically
disenfranchised black population can attain better-paying,
seen huge changes in South Africa, but on the economic front,
they’ve been mostly on the surface,” Pikul observes.
“A number of black tycoons have been brought in, but
it’s a limited group of well-connected people. The society
as a whole hasn’t changed much. Most blacks are still
The group eventually
narrowed its focus to consider the corporate angle. How, they
wondered, can companies operate and compete in this
Pikul notes that
businesses in South Africa have committed themselves to a
medium-term goal of filling a percentage of managerial and
skilled positions with blacks.
“If you don’t
train these people, you are hurting yourself, because you
will have poorly skilled managers running your company,”
Pikul says. “It’s not just a corporate cost due
to government regulation. It’s that you have to do it
to survive as a business. If you do it well, you can gain
an advantage over your competitors. In the process, you help
South Africa transform as a society and create a viable black
Pikul, Wang and
Wynn spent their time in South Africa interviewing representatives
from an array of businesses, including an insurance company,
a bank, a basic materials company and an industrial firm.
Firms should focus on skill-building and nurturing a talented
The students cited
the successful example of companies offering university scholarships
to blacks. As a condition of the scholarship, the recipient
must work for a time at the sponsoring company. Such a program
creates a long-term economic value to the firm, and can be
seen as an investment, rather than as an additional cost.
training departments with profit-and-loss responsibility is
another way to build skills, the students said. Training becomes
an investment with an expected return, which helps to emphasize
the endeavor’s long-term nature.
Pikul says the
students had to approach their South African contacts with
a great degree of sensitivity. “You come to an environment
where in the past there has been huge injustice, and it ended
only a decade ago,” he says. You can come across as
cynical when you grill the companies about what they do to
help black citizens. You have to be careful not to be perceived
Yet both blacks
and whites are working toward change, he says, and many recognize
that opportunities come along with the challenges.
that corporate responsibility can make good business sense,”
Pikul says. “In this respect, the South African experience
can serve as a model for the rest of Africa.”
to heal Brazil’s rural poor
By constitutional decree, the people who live in Brazil should
be among the world’s healthiest. Medical care is a universal
right for Brazilians, regardless of race, income or location.
The reality falls
far short of this ideal, due in no small part to Brazil’s
sprawling size and the difficulty in reaching its large rural
population. Kellogg students Dee DeFoe ’05, Caroline
Brady ’05 and Patrick Lortie ’05 sensed a business
opportunity in this discrepancy, which they used their GIM
project to explore.
a very pyramid-shaped society,” says DeFoe, who worked
in Brazil prior to enrolling at Kellogg and is considering
a career in the healthcare field. “Figuring out how
to transfer some of the good things at the top of the pyramid
to the bottom will be a major challenge as the country moves
The group believed
that technology could be instrumental in closing this gap.
Indeed, their research revealed numerous examples of “telemedicine”
— the practice of using computer networks to exchange
medical information between doctors and patients.
The trio eventually
focused on one company: Telemedicina de Bahia, which offers
electrocardiogram services and treatment support to some 140
rural public health clinics that would not otherwise have
access to specialized cardiology care.
use phone lines to transmit the EKG results to the central
Telemedicina office, where staffers diagnose them immediately
and offer treatment advice.
conditions accounting for up to one-third of all deaths in
Brazil, one would expect business at Telemedicina de Bahia
to be booming. Though the company has grown steadily since
its launch in 1999, its prospects are limited by several factors.
These include cash
constraints due to late payments, which in turn hamper the
company’s ability to make the capital-intensive investments
it needs to expand. Another major hurdle is the need to extend
the nation’s healthcare and telecommunications infrastructure.
A third impediment is the decentralization of Brazil’s
public healthcare system into smaller ministries, creating
additional bureaucratic stumbling blocks.
a lot about the interplay between the public and private healthcare
system in Brazil — how conceptually it can seem easy,
but how difficult it can be to execute,” DeFoe says.
Still, the group
concluded that in the short term, telemedicine offers opportunities
to improve healthcare in rural Brazil. One option, they said,
would be to use the Internet to disseminate healthcare information
to schools and community centers in rural areas.
DeFoe says the
project opened her eyes to the challenges of starting a business
in Brazil. It also alerted her to the opportunities.
has one of the better chances of becoming a mainstream economic
player,” DeFoe says. “It could be really fun to
go back and work there.”
challenges in China
China is booming. The world’s fastest-growing economy
is generating unprecedented levels of car ownership and oil
consumption — and air pollution.
How to profit from
China’s explosive growth while minimizing its negative
consequences became the focus of Kellogg students John Eisel,
Jonathan Glick, Adrienne Kardosh, David Mayer and Doug Roth
(all ’04) and Coleman Long ’05.
The group explored
the market opportunity for environmentally friendly technology
within the Chinese auto industry.
was to pick a social concern,” Long says. “China
is such an exciting country with so much growth, but we also
know there are a lot of controversial issues there. We didn’t
just want to focus on a narrow business concern. We wanted
to do something a little different and take a look at some
of these questions.”
that an opening exists to position cleaner vehicles as the
preferred choice among Chinese consumers. But the typical
Chinese car buyer doesn’t necessarily see the value
yet in an environmentally friendly car.
To establish that
idea, companies should expect to work closely with the Chinese
government, which views technological prowess as a key part
of the nation’s identity.
To make this link,
the students interviewed China-based representatives from
Leo Burnett, Mercer Management Consulting, GM and Valentic
Inc., an auto supplier.
focus of our research was on the government structure,”
Long says. “Understanding how to do business in China
is understanding your role with the Chinese government.”
The group noted
that under current growth rates, China is expected to consume
8 billion barrels of oil per year by 2033 — about 27
percent of the world’s current global production. Widespread
use of autos with hybrid technology could reduce that figure
by 50 percent, the students say.
It would also allow
for dramatic improvements in China’s air quality. Pollution
already costs the nation 5 percent of its GDP in healthcare
costs and lost productivity, according to the students’
Such figures are
not news to the Chinese government, which has declared the
development of cleaner vehicles one of its top industrial
A company that
can align its product strategy with this goal stands to benefit
in numerous ways, the students concluded. It can receive financial
support from the government, and it can position itself as
a player in an industry the government plans to consolidate.
where the ‘ah-ha’ moment came in,” Long
says. “We realized we could frame this as a business
problem with a business solution. It was a great experience
for us as future managers. You see a problem, but you don’t
have to look at it as a cost. You look at how you can solve
it in a competitive way.”
as this give students a true taste of the GIM experience,
in GIM gain the ability to focus on an important business
problem and analyze it,” he says. “It’s
an extremely fascinating thing to do. You meet top-level people
and interview them on a topic that’s relevant to you
personally and to your professional trajectory. It’s
something every Kellogg student ought to do at least once.”