Tom Falk, MS ’89: The Classmates Make the Program

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Tom Falk, MS ’89: The Classmates Make the Program

The CEO of Kimberly-Clark dined with future Nobel laureates while at Stanford GSB but says he learned much from his peers.
November 15, 2018
One of Tom Falk’s most enduring takeaways from the Stanford Sloan Program was learning to listen to other students — especially those from overseas. | Courtesy of Kimberly-Clark

Tom Falk, chairman and CEO of Kimberly-Clark, learned one of his most important lessons in global leadership from his Sloan classmates.

“We had 16 international students out of 42,” Falk, MS ’89, recalls of his time at Stanford. “I learned it was important to take the time to listen and understand their points of view.”

Today, Falk carries that practice with him as he leads the $18 billion company that started as a newsprint business in 1872 and is now a consumer products giant with brands like Huggies, Kleenex, and Kotex. He is in his 16th year at the helm of a company that has 42,000 employees, operations in 36 countries, and customers worldwide.

“Every time I go to a market and visit our team, I learn something,” Falk says. “If you’re able to listen and understand, there’s a huge amount you can get out of that.”

When Falk started the Sloan Program at age 30, he was one of the youngest in his cohort — and just five years into his career with Kimberly-Clark. Darwin Smith, CEO and chairman of the company at the time, had noticed Falk’s skill building financial models — especially in clutch moments, like the Black Monday stock market crash of 1987.

“I raised my hand and said I could run models,” Falk says. “In those days, if you knew how to use a spreadsheet, everyone thought you were a genius.”

Smith, who led the company for 20 years until his retirement in 1992, quickly nudged Falk toward business school. “He offered to sponsor me [and] told me to figure out where I wanted to go,” Falk says.

A Gift for Accounting

When Falk initially suggested a few local part-time programs near his home in Texas, Smith instead proposed more rigorous full-time options. Falk was accepted into a few programs but decided to attend Stanford.

“To me, it felt like the poles of the planet were shifting to the West, with so much going on in Silicon Valley,” Falk recalls. “I thought it would be a fantastic place to spend a year.”

Falk and his wife, Karen, made the most of their California time, riding bikes from their rented house near Lake Lagunita and taking in Stanford sporting events. Elected class president in his first quarter on campus, Falk was popular because he was generous with his time — and also because of his knowledge of accounting and finance.

Although he had the qualifications to opt out of Maureen McNichols’s core accounting class, Falk decided to take it, and McNichols regularly shared the floor with him to recount practical applications of the theories at hand. “Those courses were particularly stressful for many of my classmates,” Falk says. “I started to hold office hours.”

To me, it felt like the poles of the planet were shifting to the West, with so much going on in Silicon Valley. I thought it would be a fantastic place to spend a year.
Tom Falk

Falk’s academic aptitude was also apparent to William F. Sharpe, who was teaching an elective course in portfolio management at the time and is now the STANCO 25 Professor of Finance, Emeritus, at Stanford GSB. Sharpe, who would go on to win the Nobel Memorial Prize in Economics Sciences in 1990, invited Falk to join an intimate dinner with fellow Stanford GSB faculty member Myron S. Scholes and economist Fischer Black, who was visiting campus. (Scholes and Black authored the Black-Scholes options pricing model, which earned Scholes and economist Robert Merton the Nobel Memorial Prize in 1997, after Black’s death. Scholes is now the Frank E. Buck Professor of Finance, Emeritus, at Stanford GSB.)

Falk, the only student at the table, was understandably awestruck. “I’m sitting there going, ‘Why am I here?’”

Falk was also impressed by campus visits from then-Secretary of State George P. Shultz and Microsoft founder Bill Gates, who had recently introduced the first version of Microsoft Office to the world.

"The Classmates Make the Program"

But Falk’s fondest memories of the Sloan Program are his experiences with his fellow students.

“The classmates make the program,” says Falk, who was struck by both the competitive drive and playfulness of his peers. “You learn a ton from them.”

His biggest takeaway from Stanford was a method of critical thinking and decision-making that Falk says has served him well through 35 years at Kimberly-Clark. “What I got was a framework to make decisions and the confidence to make them — and to live with the consequences,” he says.

His year in the Sloan Program made him realize that there are “a lot of smart people” who are also “struggling to make the hard decisions.”

“The easy questions, somebody already answered,” Falk says, reflecting on his series of leadership roles with Kimberly-Clark. “You’re there to weigh in on the questions where there isn’t a clear answer. If you have the right framework, you can help lead people through.”

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