May 2004

Cornerstones of a Management Education

by Dean Robert Joss

One of the great joys of being dean is meeting our alumni. The challenges they are tackling are enormously complex, and they are making lasting differences in people's lives. One of them is Lorenzo Zambrano, whom I first met in Monterrey, Mexico, not long after I became dean. Lorenzo, now 59, graduated from the MBA Program in 1968 and joined Cemex, the giant Mexican cement maker.

When he became CEO in 1985, revenues were about $1.7 billion. Lorenzo then led the company on a global path starting with the acquisition of Spain's two largest cement companies in 1992. Over the next decade, the company expanded in Latin America, the United States, Asia, and Africa. It is now a $7.2 billion company, Mexico's largest multinational, with 26,000 employees operating in 30 countries. He innovated by moving Cemex into information technology, which allowed the company to monitor its business electronically, improving quality, efficiency, and service. But it isn't all about the numbers. In addition to skills-specific training, Cemex launched a program to get employees the equivalent of high school and college diplomas. It helped create wilderness reserves in Mexico and participated in environmental sustainability programs such as quarry reclamation and waste management. In the developing world, it has worked with local municipalities to replace more than 190,000 dirt floors in people's homes with antibacterial concrete.

"Cement may not strike most people as a product of great humanitarian importance, but in Caracas, Manila, and the squatter cities of Peru, it means roads and hospitals, sewers, power plants, and water systems," Lorenzo has said. "For so many of our customers, cement is the stuff of dreams. The tools you acquire at the Business School can improve, enrich, and fulfill the lives of millions of people who will never set foot on this campus." Lorenzo, who is also chairman of Tecnológico de Monterrey, Mexico's largest private university, has said that he strives to build an institution that will provide all of Latin America with a new generation of business leaders. "Like Stanford, we are fostering entrepreneurship among our best and brightest students."

Lorenzo made those remarks in 1998, when he was awarded the Ernest C. Arbuckle Award of the Stanford Business School Alumni Association. But the words are as apt today. Observing challenges and achievements like his has deepened my conviction that management is a noble calling and that the direction in which we are now taking the Business School is the right one.

His experience illustrates the four cornerstones that I believe are essential to a complete general management education—whether our graduates go into conglomerates, small companies, or nonprofits. These cornerstones are leadership, entrepreneurship, global awareness, and social accountability.

Why these four? And how do I envision their further infusion into our program? First, leadership means taking full responsibility for playing a role in changing an organization for the better. To do this, business leaders must know themselves very well, understand their strengths and weaknesses, always act with integrity, and know how to motivate and inspire others. Sixty students are experiencing a pilot program in leadership development this year. Next fall, we plan to include more students. Our new Center for Leadership Development and Research will be a focal point for research, programming, and coaching to support students' personal leadership growth.

Second, entrepreneurship sometimes means starting a business; but it always means innovating and acting with the perspective of an owner of a business, whether you are managing it, advising it, or investing in it. Innovation must happen within large organizations too. Studying entrepreneurship gives our students a way to understand how all the functions of a company work together in a fast-changing environment. Since 1996, when we established the Center for Entrepreneurial Studies, we have developed a critical mass of 17 courses, forums, and path-breaking research in this area.

Third, global awareness means knowing what it takes to be a world-class organization, and how to build one organization that spans multiple countries, cultures, and economic or political systems. This month, I am looking forward to the kickoff of our new Center for Global Business and the Economy with a conference involving students, global practitioners, and alumni.

Fourth, a sense of social accountability means understanding that businesses are not only economic institutions but also social institutions with responsibilities to many stakeholders and the community. To ensure profitability in the long term, business leaders must earn the trust and confidence of their staff and society and integrate important concepts like environmental sustainability into their business planning. I know that, like Lorenzo, our students will go on to impact positively the world around them. I want to ensure that the Business School builds the best foundation for their doing so.

From the Editor

Dean's Column

PHOTOGRAPH BY ROBERT HOLMGREN