HKUST Business School [SBM] Newsletter, May 1999 (Issue 6)

Abstract

[evdate 1999-05-15] HKUST Business School Newsletter ISSUE 6 MAY 1999 1Clear Water Bay, Kowloon, Hong Kong The HKUST Business School has been formally accredited for all of its business and accounting degree programs by the AACSB - The International Association for Management Education. The official announcement was made 18 April in Atlanta, Ga., USA by AACSB. Established 80 some years ago as the primary accrediting agency and service organization for business schools in North America, AACSB has recently globalized its accreditation activities. This is the first time it has granted accreditation to business schools in Asia. And it did so to only two business schools in this inaugural round: HKUST and the Chinese University of Hong Kong. During the accreditation process, the School was visited and evaluated by business deans and senior faculty from the Ohio State University, University of Chicago, University of Southern California, University of Washington, University HKUST FIRST IN ASIA TO ACHIEVE AACSB ACCREDITED STATUS Software industry veteran Dr Jeff Papows gave a presentation on "The IT Revolution and Business Value" at a seminar organized by the Business School in April. The talk featured an insider's view of the technological advancement that is expected to continue to transform our society and the business world well into the next millennium. Papows is president and CEO of Lotus Development Corporation and a member of the IBM senior management team. He shared his vision of the impact of the IT revolution and how Internet created new business opportunities and value. Some of the hottest topics concerning the business community, such as web-infrastructures and their competitive advantages, IT and knowledge management, globalization and new strategies in management and marketing, were also covered. Dr Papows is a prominent industry figure. In 1997, he was named one of the top 100 people shaping the information technology industry by Upside Magazine. He is the author of Enterprise. Com, an analysis of how the Web, Internet and IT industry have transformed the way the world conducts business. The talk, broadcast live via the Business School's website, attracted a full house. LOTUS TALK Professor K C Chan (left) and Dean Yuk-Shee Chan (center) receive the accreditation certificates from Milton Blood, Director of Accreditation, AACSB, in the association's annual meeting in Atlanta. The Business School held its board meeting in April. And, for the first time, the meeting involved both its academic and corporate advisors. The meeting covered important areas for the School's future development, in particular its undergraduate and MBA programs, and its executive education initiatives. All academic advisors who attended the meeting had flown in from overseas. They included George Daly, Dean of Leonard N. Stern School of Business, New York University; Stuart Greenbaum, Dean of John M. Olin School of Business, Washington University, St. Louis; Donald Jacobs, Dean of Kellogg Graduate School of Management, Northwestern University; Professor William Pierskalla, Anderson Graduate School of Management, University of California, Los Angeles; and Professor Claude Rameau, INSEAD. Seven local corporate advisors also participated TOWN AND GOWN ADVISORY MEETING Professor Leroy Chang (left), Vice-President for Academic Affairs, presents a souvenir to Dr Jeff Papows. in the meeting: Philip Chen, Deputy Managing Director of Cathay Pacific; Peter Clarke, Senior Advisor of Merrill Lynch; private investor Dennis Lam; S. C. Liu, Managing Director of Hang Cheong Surveyors; Martin Tang, Managing Director of Spencer Stuart (South/Southeast Asia); Jo螔 Tiphonnet, Marketing Director of Integrated Display Technology; and David Wong, Managing Director of United Overseas Capital. Dean Yuk-Shee Chan, who convened the meeting, spoke enthusiastically about the productive exchange of ideas and the success of the meeting. "It was a wonderful experience for all the participants, including the advisors and our own senior faculty members and administrative staff. The combination of advisors from both the academic and corporate sectors provided distinct perspectives for the discussion and useful insights for the business school's strategic planning," he said. MBA year-1 student Gao Jian followed in the footsteps of his HKUST predecessor in winning a place to participate in the 29th International Management Symposium at the University of St. Gallen in Switzerland. This is the second year in a row that an HKUST MBA student's work was selected among the 250 best entries in an i n t e r n a t i o n a l c o m p e t i t i o n preceding the symposium. Under the theme "New MBA STUDENT WINS TICKET TO INTERNATIONAL FORUM gree in computer science and a master's degree in economics. The essay that he entered for the competition was on "Technologi-cal Innovation, Entrepreneurial Management and Cultural Compatibility". "My background in computer science helped me de-velop the basic ideas of the essay. It was also inspired by the cultural differences that I encounter in Hong Kong," said Gao Jian. The symposium will be held from 31 May to 2 June 1999. Markets, New Technologies, New Skills", the symposium aims at stimulating constructive analysis o f n e w a n d s u s t a i n a b l e developments in order to identify practical options for the corporate world. Authors of the best entries will meet with more than 800 participants - elite business and industrial leaders, politicians and scientists from Asia, Europe, and the United States. At Beijing University, Gao Jian obtained an undergraduate de- of Wisconsin-Madison, ESSEC of France, the International University of Japan, and a local corporate executive. The high-powered team was strongly appreciative of the School's accomplishments and unanimously approved the accreditation of all its programs. Dean Yuk-Shee Chan said, "this is a significant milestone of the development of Hong Kong's management education. I believe we all can be justifiably proud of this tremendous endorsement from AACSB. As I have learnt, never in the history of AACSB had any school achieved accreditation at a young "age" below 10!" Two local newspapers, the South China Morning Post and Ming Pao Daily, published a special report to commemorate the accreditation, with congratulations from a number of prominent figures, including the Chief Executive of the HKSAR, the Secretary for Education and Manpower and the Chairman of the University Grants Committee.

2The Hong Kong University of Science & Technology BUSINESS FORUM SUPPLY CHAIN MANAGEMENT KEY TO REJUVENATING HONG KONG'S COMPETITIVENESS The bursting of the economic bubbles in Asia has propelled changes in the ways businesses operate. When the Asian tigers faltered during their historic emergence, many corporations began to look beyond the shattered remains of the economy to search for more basic skills and values needed for the building or rebuilding of strong fundamentals. A long-standing hub of material coordination and import/export logistics in the region, Hong Kong now finds it a priority to maintain this status and outperform its competitors. Industry leaders as well as academics believe that proper use of the supply chain management concept will help Hong Kong accomplish these important goals. SUPPLY CHAIN MANAGEMENT Simply put, a supply chain is a network for the production and delivery of goods and services, which starts with the suppliers' suppliers and ends with the customers' customers. Supply chain management requires a company to break company boundaries in order to work closely with its suppliers and customers and also to break functional boundaries so that it can monitor and integrate the various facets involved, such as manufacturing, distribution, marketing, accounting, information, and engineering. It also requires the coordination of the flows of materials, information, and finance. In the last 10 years, the subject of supply chain management has caused tremendous excitement and attracted top management attention. In the US, where the concept originated, success stories abound. Dell Computer ( Harvard Business Review, March-April 1998), for example, achieved mythical success by stitching together its key suppliers to form one supply chain. With the help of advanced technology, customers' orders were matched and placed while inventory was kept at a minimum. In Hong Kong, a recent survey conducted by an HKUST research team of professors and postgraduate students shows that while companies have come to realize the potential benefits a supply chain can bring, few have adopted a comprehensive approach to implement it. Dr Ki Ling Cheung, Assistant Professor of Information & Systems Management of HKUST, said companies in Hong Kong should be swift in taking the advantage of the concept to add value to the fundamentals of their operations. "We see great potentials in the concept and application of supply chain management. If implemented correctly, supply chain management will help a company gain market shares, reduce costs, improve customer services, and increase profits and returns to assets," said Dr Cheung. The issue, however, is how company executives can acquire the knowledge and skills for such implementation. In 1997, the Information and Systems Management Department and the Industrial Engineering and Engineering Management Department of HKUST formed the "HKUST Logistics and Supply Chain Forum" with the objective of enhancing the competitiveness of Hong Kong's distributive services. The Forum is affiliated with the world's most important supply chain management organizations: the US-based Stanford Global Supply Chain Management Forum and the Netherlands-based Eindhoven Forum. The HKUST Logistics and Supply Chain Forum fosters interaction and networking among industrial practitioners, academics and government bodies by organizing activities such as talks, conferences, meetings, and workshops. There are also annual conferences for academics to exchange ideas, as well as courses to provide training for executives. CUTTING EDGE RESEARCH Because the business environment is ever changing, it is important that results of academic research on supply chain management can be applied to real practice in an efficient manner. "The fascinating thing about supply chain management research is that because of the very practical nature of the subject, the industry can almost get instant benefits from the findings generated by academics," Dr Cheung said. Examples are two recent research projects that Dr Cheung has been involved with: "The Impact of Inventory Information Distortion Due to Customer Order Cancellation", in conjunction with Dr Alex Zhang of the Department of Information and Operations Management at University of Southern California (now working with the Hewlett-Packard Laboratory); and "Coordinated Replenishments in a Supply Chain with Vendor-Managed Inventory Programs", jointly with Professor Hau Lee of Department of Industrial Engineering and Engineering Management at Stanford University. In the first project, the researchers found that although the practice of reservation will involve the risk of an order being canceled, which in turn will lead to extra costs, the damage is small compared to the benefits of the reservation practice. The research also found that the earlier the cancellation was made, the less the damage incurred would be. It further proposes that a company can square the loss resulting from a cancellation by imposing a cancellation charge which, all other things being equal, should represent 10 percent of the cost of the canceled order. The second project looks at the benefits a supplier gains by using the information on its retailers' inventory positions to coordinate shipments in order to enjoy the economies of scale in shipments and using the same information to eventually unload the shipments to retailers to rebalance their stocking positions. It was found that both acts are highly effective in helping to reduce the costs for retailers. In other words, with increased information sharing among partners (i.e., suppliers and retailers) in a supply chain, the movement of materials can be more accommodating in terms of timing and quantity, and as a result everybody benefits. THE WAY FORWARD While supply chain management still needs to be promoted to become a common practice in Hong Kong, Dr Cheung is optimistic about its future development. There have already been local success stories. One such example is Li & Fung ( Harvard Business Review, September - October 1998). A pioneer in dispersing its manufacturing globally and a serious practitioner of supply chain management concepts since the 1980s, the company is listed as one of the most profitable companies in Hong Kong. It is the mission of the HKUST Logistics and Supply Chain Forum to promote supply chain management in Hong Kong and the whole region. In addition to leveraging on its valuable international connection and support from the industry, the Forum also intends to strengthen its ties with governments and government-related organizations to help disseminate the knowledge and concepts of supply chain management to a wider audience. Related websites on Supply Chain Management The European Forum on Global Supply Chain Management: http www.tm.tue.nl/efgscm/ The Stanford Global Supply Chain Management Forum: http www.stanford.edu/group/scforum/ How Does A Supply Chain Look like? Supplier Manufacturer Distributor Retailer Customers Cash Flow Information Flow Material Flow For further information on the topic, please contact Dr Ki Ling Cheung at: imcheung@ust.hk. 3HKUST BUSINESS SCHOOL Newsletter A group of 30 students from Kellogg's Global Initiatives in Management (GIM) program visited the

Business School in March. Led by Dr Angela Leung, a Hong Kong born and tertiary-educated academic now serving on Kellogg's

faculty, the team spent two weeks in Shanghai and Beijing where they met with the Chinese government officials and business executives, before coming to Hong Kong. The team's visit to the School included a tour of facilities and an evening gathering. Michael Ducker, President of Federal Express APAC Division and a Kellogg-HKUST EMBA program graduate attended the gathering and spoke on the business development of Fedex. Dean Yuk-Shee Chan Contact us: email: bmmhung@ust.hk (May Hung) echu@ust.hk (Elaine Chu) fax: (852) 2358 1467 website: http www.bm.ust.hk FROM THE DEAN The previous months were full of exciting news and significant events. On the top of the list of exciting news is the School's accreditation by AACSB - The International Association for Management Education. This is yet another important milestone in our development for the following reasons: First, this is the first time the Association, the premier international business school accrediting agency, has accredited schools in Asia. And of the only two Asian schools that were accredited in this first round, our School is one of them. Second, with AACSB accreditation, our School joins the same league as the world's most famous business schools such as UCLA, UC Berkeley, Chicago, Columbia, Cornell, Dartmouth, Harvard, New York University, Northwestern, Pennsylvania (Wharton), and Yale in the US. And third, our School has become the only school with a history of less than 10 years when being accredited! This is a record for AACSB and also a strong recognition of the quality we have attained in management education during the last eight years. Along with this great news, we held two major events recently. They were the advisory board meeting and the first EMBA graduation, both held in mid-April. This year's advisory board meeting had a new format that combined both the academic and corporate advisors. Like in the previous meetings, the advisors provided insights and new ideas for further strategic development of the School. For the assistance that our advisors have offered to us, we are very much indebted. Over the same weekend as the advisory board meeting we held our first EMBA graduation ceremony. After 16 months of intensive learning, our inaugural class of 30 EMBA students strode in the procession with a sense of pride and achievement that they rightly deserved. The ceremony brought to the HKUST campus Dean Donald Jacobs and representatives from our partner, the Kellogg Graduate School of Management of Northwestern University, and families of the graduates. We were also honored to have Ronnie Chan, Chairman of Hang Lung Development and our President, Professor Chia-Wei Woo, present at the ceremony to offer their best wishes to our graduates. I would like to thank all faculty, staff, students, and friends of the School for all your hard work and contributions. With your incessant strong support, we will continue our drive to achieve world-class standards in every aspect of our endeavors. KELLOGG GIM VISIT MASS SESSIONS DRAW MORE THAN 1,500 PARTICIPANTS Michael Ducker BUSINESS MENTORING PROGRAM LAUNCHED The Business Mentoring Program for undergraduate business students was officially launched in

April. A total of 16 members of Friends Unlimited, a non-profit organization founded by a group of

young professionals, and 15 students are involved. The program aims to establish mentor-mentee

relationships between business executives and HKUST business students to nurture the academic, career

and personal development of the students. It will run from April to the end of the year during which the

participants will meet at least once a month for lunch meetings, simulated formal conferences, and social

gatherings. During this May, the Business School held its annual JUPAS Information Sessions for secondary students who are interested in the School's undergraduate programs. More than 1,500 participants attended the sessions. Among the eight sessions scheduled this year, five were on BBA programs, two on BBA-Accounting and one on the BSc in Economics and Finance (a new program being launched for the 1999/2000 school year). Apart from presentations given by faculty speakers, undergraduate representatives also described their learning experiences and school lives to the potential entrants. Undergraduate Programs Director Professor Kar Yan Tam said, "the mass sessions are one of the outreach programs specially designed for secondary students. Other activities, such as the Open Day, Parents' Day, and school visits, are also in the pipeline to strengthen the School's connection with Hong Kong's secondary schools, as well as with the students and their parents." Wanda Chang (left), Member of Friends Unlimited and Coordinator of the program and Dean Yuk-Shee Chan. Nisa Leung (left), President of Friends Unlimited and Luke Wong, Director of HKUST Student Affairs Office. 4The Hong Kong University of Science & Technology HKUST Business SCHOOL - Newsletter

MTRC PROGRAM ATTUNED TO CORPORATE EXECUTIVE DEVELOPMENT NEEDS EXECUTIVE DEVELOPMENT The Accelerated Development Program for MTR Corporation was completed in April after a 12-day residential program on the HKUST campus. This is the first non-degree program offered jointly by the School and Kellogg Graduate School of Management. Tailored to the strategic needs of the MTR Corporation, the program was structured into four sessions running from January to April 1999. Each session featured three days of resi-dential program on different managerial aspects including finance, information technology, ne-gotiation and decision making, transportation issues, marketing, and managerial accounting. A total of 28 senior executives from the corpo-ration took part in the program. Kitty Chan, Director of Executive Programs and External Development, said, "our execu-tive programs are closely attuned to the man-agement development needs of today's com-panies to develop best-in-class managers Flowers, ribbons, live music, and the company of families made for a special day for the EMBA graduates on one Sunday afternoon in April. In what was the first graduation ceremony of the Kellogg-HKUST EMBA program, the 30 graduates were greeted by President Chia-Wei Woo NEW UG TEAM Professor Kar Yan Tam has been officially a p p o i n t e d a s t h e Undergraduate Programs (UG) Director with effect from 5 May 1999. He will be assisted by two UG Associate Directors: Dr Wilson Tong (Finance) for academic matters and Ms Rovena Kwan for administrative matters. Professor Tam was much enthused by the formation of the new team. He said, "this enlarged team brings in an additional dimension of Wilson's academic background and teaching experience. The synergy to be created between him and Rovena, who has been involved with UG matters ever since the School was started, will surely bring new impetus to the development of the UG programs." who can add value to the organization by ap-plying what they learned immediately back on the job. For the MTRC program, we worked with the company's management to devise a cur-riculum that suited their corporate objectives FIRST EMBA GRADUATION Participants of the Accelerated Development Program. of HKUST, Ronnie Chan, Chairman of Hang Lung Development and a corporate sponsor representative, Dean Donald Jacobs of Kellogg and Dean Yuk-Shee Chan. Program directors Steve DeKrey (HKUST) and Erica Kantor (Kellogg) shared the joyous ambiance of the event with the graduates and their families. "It was a wonderful experience to have worked with this group of students. As our first class we really drove them hard, and as we had anticipated, they all did very well, setting a very high standard for their successors," said Dr DeKrey. Ms Kantor said, "from my experience, each class of students creates a unique set of ties and culture. This group has developed a very strong bond among themselves and also with us and HKUST. We welcome them to be our alumni and I am sure our paths will cross in the years to come." and business strategies." Dean Donald Jacobs from Kellogg and Steve DeKrey, Associate Dean of HKUST Business School, officiated at the program's closing ceremony.