Navigating Overseas Markets
by Kirsten Wile
Businesses and students benefit when MBA field projects take an international tack.
"As soon as the students started speaking Chinese, the interviewees opened up and the conversation really took off. I'd put our students up against students from Harvard or Berkeley any day."
Fifty-six percent of the MBA class of 1997 at the U spoke a second language, and since 1995, 77 percent of entering MBA's at BYU have been bilingual.
Cytozyme, a biotechnology company in Salt Lake City that develops enzyme formulations for agricultural use, has identified a viable market in China for one of its fertilizer additives. But despite increased privatization, China's agricultural industry is primarily state-owned that is, governed by provincial agencies. In order to do business in China, the company must comply with complex bureaucratic regulations which differ for each regional province. A small entrepreneurial firm with only 20 employees, Cytozyme lacks adequate resources to navigate a course through China's bureaucratic channels. Nor can the outfit afford the expertise of a private consulting firm. Rather than delay a market-entry study and risk missing the boat, Cytozyme called the Center for International Business Education and Research (CIBER) at the U for help.
Operated jointly by the Global Business Program of the U's David Eccles School of Business and Brigham Young University, CIBER is a nine-year-old, federally funded training, research, and outreach venture. About 80 percent of the Global Business Program's money comes from CIBER, which takes its name from a piece of legislation that allows for the distribution of federal grants to programs that provide research and training in international business. "The three-year grants are competitive there are only 25 such centers across the nation and the Utah-BYU partnership is the only joint venture in the country," explains the program's manager Stephen Hurlbut MBA'97.
The Utah-BYU Center provides undergraduate and graduate students from both schools a host of opportunities to study and work abroad. It also sponsors and coordinates international faculty exchanges and workshops for local and regional business leaders with interests in the global marketplace. Its flagship program, however, is the International Field Study Program, to which Cytozyme turned for consultation.
"The international MBA field project captures the essence of the Global Business Program at the U," says Business School Dean John Seybolt. "In addition to doing what all MBA students here at the David Eccles School of Business do, international-track MBA's undertake field studies that address major international concerns for companies abroad," explains Brooklyn Derr, management professor and CIBER director.
Student enrollment in the International Field Study Program has doubled since its introduction in the fall of 1996. This year, 20 MBA students from the U, BYU, and Utah State University participated. With demand among students for business field studies growing, priority is given to the top students in the international track of the U's MBA program.
Students who make the grade are hired to consult on a project. They spend Winter term preparing and researching. During spring break, they visit their project sites to conduct in-depth research and interviews, and, upon return, write their final reports for presentation before their clients. Though no simple task, the students benefit in a number of ways from the experience. In addition to building their confidence, the projects make students more marketable to prospective employers through professional exposure and experience, says Derr, who has taught and consulted throughout Europe and in the former Soviet Union. The author of several books on "internationalizing" managers, he believes there is no better way than field study to provide students the knowledge and skills necessary to succeed in international business.
In a 1997 survey of former international-track MBA students, 60 percent had been engaged in international business, both home and abroad, since their graduation. About 38 percent had conducted business in a foreign country since graduation, and 33 percent were stationed or regularly traveling abroad for business at the time of the survey.
Thus far, international field studies have taken place in France, Costa Rica, Mexico, China, Taiwan, Japan, and Vietnam. Cytozyme, the telecommunications conglomerate AT&T, computer networking company Novell Inc., and General Electric are just a few of the companies who have sought student assistance through the program. Like the students, the companies also benefit they receive expert advice for marginal cost. Companies pay a consultation fee which ranges from $5,000 to $7,500 to the program. This fee is substantially less than the $25,000 to $100,000 it would cost to hire a professional consulting firm, and, according to Hurlbut, the product is equivalent.
Most consulting firms' practices originate in academia, he explains. Consequently, students of a business school are likely to encounter breakthroughs in management or marketing strategy sooner than would consultants in the business world. The U's own International Strategy faculty which consists of professors Steve Tallman, Karin Fladmoe-Lindquist, and Anoop Madhok is ranked 13th in the world for original scholarly publication in international strategy over the last decade. Most of their work is related to joint-venture or market-entry strategy. The school's two most published professors are Janeen Costa and Russell Belk, who are recognized experts on the influences of culture on marketing and international business.
Most of the nation's top business schools offer similar field study programs, but the Utah-BYU program is unusual because its students, many of whom have spent time overseas as missionaries, are generally fluent in the language of their assigned country. More than 30 percent of the business students at BYU and 20 percent at the U speak a foreign language, and almost all of these students have lived abroad for 18 months to two years. This compares to a national average of five percent. Statistics for the two schools' MBA students are even more impressive: 56 percent of the MBA class of 1997 at the U spoke a second language, and since 1995, 77 percent of entering MBA's at BYU have been bilingual.
Hurlbut, who selects and organizes all the projects and often advises the student teams, says of his experience leading a team to Taiwan: "The team members spoke Chinese well and knew a lot about the culture. Their ability to deal with everything from getting taxis to finding reasonable restaurants was indispensable." What's more, the team's ability to conduct interviews in the native language facilitated interviews and research. "As soon as the students started speaking Chinese, the interviewees opened up and the conversation really took off. I'd put our students up against students from Harvard or Berkeley any day," he says.
The U and BYU also house two of the most comprehensive Asian studies programs in the country, and their faculties have built personal and professional links with several universities in Asia. In fact, the Utah-BYU center holds the only workshop in the nation for educators on techniques for teaching Japanese, Korean, and Chinese for use in a business context. These facts were not lost on Cytozyme, according to its director of public relations, Jeanette Holmes. "Because the pool of MBA students was culturally diverse and the CIBER program already had a working relationship with a major university in Beijing, Cytozyme decided to give the program a try."
The results were positive. Holmes said the work of the two students from the U and two others from BYU who worked on the project was accurate and helpful. The students investigated two provinces in China to determine what procedures Cytozyme needed to follow in order to enter the Chinese fertilizer market. "Their report confirmed and verified some of our suspicions, and identified for us some contacts and decision makers with whom we might continue to work," she explains.
For projects of a much larger scope than Cytozyme's that necessitate years of research and consultation, CIBER's field-study projects would be inappropriate. But for companies that lack the human and professional resources to compete in today's increasingly interdependent global economic system, the program is hard to match, says Derr.
Business managers who would like more information on how to participate in the program may contact the University of Utah School of Business at (801) 585-3360.
Kirsten Wille BA'92 MA'97 is a University News Service writer.