Rice Business - Spring 2017

STRETCH

Unlock the Power of Less PAGE 20

SHOPPING FOR CUSTOMERS Reviving the American Department Store PAGE 38

FIXER UPPER Saving the Dome PAGE 26

RICEBUSINESS M A G A Z I N E O F T H E J O N E S G R A D U AT E S C H O O L O F B U S I N E S S AT R I C E U N I V E R S I T Y

A Seat at the Table

What a top 10 ranking in Businessweek means for the school and where to go from here page 30

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JONES EDGE

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EL SALUDO Dean Peter Rodriguez led a group of Rice Business students to Buenos Aires, Argentina, this past January. While there the full-time and professional students visited businesses and heard from leading executives throughout the country. Entrepreneurship, white collar crime and product manufacturing were all themes of the trip. During their time abroad the students also found time to enjoy the lively culture of colorful Buenos Aires, including the neighborhood in the photo near the Boca Juniors Stadium. Photo by Caitlin Crotty ’17 3

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contents S P R I N G 2 017

RICEBUSINESS BUSINESS 44 RICE

F e a t u r e s

20 Stretch

Unlock the power of less

26 Fixer Upper

Saving the Dome

30 A Seat at the Table

What a top 10 ranking in Businessweek means for the school and where to go from here

32 Best of Intentions

The grinding work of transparency

38 Shopping for Customers

Reviving the American department store

D e p a r t m e n t s

8 Rundown 18 Impressions 24 Rice Busines Wisdom 42 Around the Water Cooler 47 Peter’s Page

Rice Business is published semiannually for alumni and friends by the Jesse H. Jones Graduate School of Business. Current and back issues of the magazine are available online at business.rice.edu/RB. Change of Address?

New Job? Update the online directory with your new contact information at business.rice.edu/alumni.

Comments or Questions?

We’d love to hear your thoughts about Rice Business. Send an email to Weezie Mackey, editor and associate director of communications, at wmackey@rice.edu.

RICE BUSINESS Dean Peter L. Rodriguez Executive Director Marketing and Communication Kathleen Harrington Clark Editor Weezie Mackey Design Director Bill Carson, Bill Carson Design Creative Director Kevin Palmer Associate Director Intellectural Capital Claudia Kolker Graphic Designer Eduardo Martinez Web Specialist Michael Okullu Contributing Writers Jeff Falk Claudia Feldman Mary Lee Grant Weezie Mackey Jeff Schmitt Allyn West

Moody Center for the Arts, Rice University.

See page 34 for more. Photo: Nash Baker.

Contributing Photographers Nash Baker Bill Carson Caitlin Crotty ’17 Jeff Fitlow Ron Fontenot Kevin Palmer Ed Schipul James Zhao ’15 Printing Chas. P. Young Co.

5 5SPRING SPRING 20172017

FROM THE

DEAN

“ Being on campus and around our students takes

everyone back to a special time in their own lives when they were still at the beginning of becoming.”

Check out what Peter’s been up to on the inside back cover of this magazine.

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event RSVPs by the numbers Being a part of a college campus is special, both in ways that are easy to see and in ways that are not. Just about everyone I know who visits a college campus readily recalls cherished memories of courses and classmates, of the excitement of learning, of growing and of the freedom that is never more abundant than when we are young.

Being on campus and around our students takes everyone back to a special time in their own lives when they were still at the beginning of becoming.

What is often less well appreciated is that universities are places of scheduled and deliberate transitions. At Jones, the vast majority of our community is in fact a purely temporary community on a two-year cycle that never repeats and — mostly — never reassembles in just the same way. The knowledge of this temporariness lies just below the surface of all our engagements and adds energy and investment to the relationships we develop. You might call this the secret sauce in college relationships. Everyone is moving through and eventually moving on, and, because we know this, the time together is all the sweeter as a result. Around this time every spring, graduating students look around and savor those final few weeks with the people who have made their lives richer, who will be a permanent part of their future and who they didn’t know at all 23 months ago.

Luckily for those of us who make our livings here and aren’t on the scheduled transition, the specialness of college life is just as available to us.

After all, it isn’t graduating that makes being here special. It’s having something to look forward to and knowing that the future is sure to be bright.

Come around for a visit and I’m sure you’ll see just what I see. We have much to look forward to and abundant reasons to be optimistic about our growth, our energy and our ever-rising quality.

I remember how good it felt to be on the cusp of a few graduations and knowing, deep in my bones, that the next few years were going to be exciting and wonderful. And I feel that way now.

Thank you for all that you do to make Rice Business special. And, thank you in advance for being a part of all that we have to look forward to. —Peter

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Rice Veterans Leadership Series

160

Women in Leadership Conference

516 350

“Stretch” Book Launch

Rice Energy Finance Summit

Inaugural Diversity Conference, Sparking Success

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Jones Partners Thought Leadership Series

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January On-Campus Admission Information Session

rundown

A ROUND-UP OF NEWS FROM RICE BUSINESS AND BEYOND

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Last December, 140 current

Fulbright Fellows from more than 70 countries visited Houston for three days of enrichment focused on innovation and entrepreneurship.

The programming, sponsored by the Fulbright Commission, was designed and led by Rice Business faculty member Abby Larson.

Inspired by her own research around the question, “What is Innovation … to You?” Abby charged the fellows to explore their answers to that question in multiple ways — within their respective fields of study and local contexts, as well as together as a group. Multiple voices Like a from Rice engaged in the conversation, inKid in cluding Professor of Bioengineering and 2016 a Cand A few bu MacArthur Fellow Rebecca Richards-Kory Stor s i ness s busy m e c tum; Director of the Ken Kennedy Institute a h k o For Co ing movie ol profes for Information Technology and Professor platfo ursera, the s. Sort of. sors have b of Computer Science Moshe Vardi, and world’ rm that off massive op More like een s best ers un en onl videos Houston entrepreneur Jeff Reichman. iv in . e

ducati e e Financ on, on rsal access course (MO e p l OC) rofess ine, f t market ors Ja or fre o the In March, 140 new Fulbright Fellows i n g p m e on Cou rofess es Wes . came to Houston. Expanding on earlier videos rsera last or Sharad B ton and Arz , quiz f o u programming with Richards-Kortum, zes an all, which rle made th Ozoguz and Rice h d proj featur e Vardi and Reichman, additional panects. ed pre ir debut 2012, as been one -recor elists included Houston-based artist ded new ve one of the of Courser Dario Robleto, who served as the nture. first 1 a’s pa 2 rt There 2016 Texas Artist Laureate and whose Let’s are no universitie ners since s w s to j a 150 pa work has been featured in solo and profes y you wan oin th r t s n t i e o rs. e to kno nals m group exhibitions at the Menil and Financ w a k h e e o f d w o e r Noncision financi cover the Whitney Biennale.

F s a MBA-le all the maj inance Prof . Check out l v o e e r s We sional topics months l course. s and ston’s Abby was recently named inaugural f r t T o o h m e you’ rec a f minute fiv director of the Liu Idea Lab for Invideos ord and req e-week cour ull semeste ll . uired s r novation and Entrepreneurship at Borle 50 or e took four t e s a o ches a five to Rice, scheduled to open this year.

Statis s 10 course tics and An pecializati The lab will focus on opportunis a o l n a y n s c d i a teache s, whi lled B a sep ties in innovation and entreprePortfo s a special arate capst ch is made usiness neurship for undergraduates, four c lio Managem ization cal one project up of four exploring and responding to ent, w ourses l . hich i ed Investme Ozoguz . questions across the discis also nt made u and plines and professions and in p of conversation with a broader society.

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Meet Your Classmates Everyone loves the underdog. We naturally root for the little guy, the long shot who shocks their world. It is a feel-good story as old as reeds and clay tablets. A motley band of misfits — small and unseasoned — seize their destiny through a mix of moxie and extra effort. Who doesn’t enjoy seeing the favorite get knocked down after selling their opponents short? Whether you tear up for Rocky, Netflix, or the Cubs, underdogs provide a short reprieve from the stale status quo. They are a hopeful reminder that we too can beat the odds.

Among business schools, the Jones Graduate School of Business at Rice University is this year’s underdog. Like all good dark horses, the Sultans of Space City left chaos in their wake. This month, Jones shot up 11 spaces in the annual Bloomberg Businessweek rankings to rank 8th among full-time MBA programs. In the process, they vaulted over established powers like Kellogg, Haas, and Columbia (not to mention the state’s flagship program in Austin). How did they do it? It’s simple: Like any good business, they delighted their key constituents.

The price of admission Forbes 30 Under 30 is even harder to get into than Rice University. At less than four percent (Rice is 15) and with A-list legends serving as judges for the illustrious list of entrepreneurs, innovators and game changers, the Forbes list is a coveted distinction.

Read more about new members of the Class of 2018: http://business.rice.edu/PandQ2018 —By Jeff Schmitt

In 2017, seven former Rice Business Plan Competition team members were added to the prestigious group. In addition, CEO of Rebellion Photonics Allison Lami Sawyer ’10 — a RBPC alum and 2015 Forbes 30 Under 30 winner — served as a judge for the 30 Under 30 energy sector.

In all, 32 RBPC alumni and five Rice graduates have been named to Forbes 30 under 30 since 2011. You can see the full list at: http://business.rice.edu/ forbes2017

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rundown

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Newly appointed President and CEO of Memorial Hermann Health System Ben Chu M.D. (right) reflected on his time in New York City after 9/11 in his talk about leaders creating an environment where people want to do the right thing. Professor Brent Smith joined the discussion identifying how to best prepare leaders to approach and improve company culture. The February Thought Leadership Series drew one of the largest crowds for a Jones Partners event.

PHOTO BY RON FONTENOT

Recently the Jones Student Association for Professionals hosted the 5th annual Owl Bowl, a charity flag football tournament between Houston area MBA programs including teams from all of the Rice Business programs as well as Texas A&M, the University of Texas and Tulane. Due to the generosity of the participating students and some corporate sponsors, the event raised over $10,000 for a charitable cause, to be selected by the tournament champions. This year, the JSAP is excited to donate these funds to the Covenant House of Houston, an organization dedicated to helping homeless children and protecting all children in need. Covenant House opened its doors in 1983 and, for more than 30 years, has continued to help kids in crisis with residential programs, community services and outreach efforts designed to keep young people off the streets. Way to go Jones Student Association for Professionals!

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O H

T H E

P L A C E S

Y O U

W I L L

G O

Many curriculum changes have been in the works at Rice Business. One of the most highly anticipated is the required global experience for all MBA students. We understand the boundless importance and ongoing benefits that a global mindset, both business and cultural, plays in the overall MBA experience. The Executive MBA program kicked off their required global programming back in 2016. By the fall of 2018, each student who comes through the MBA program will travel abroad as part of his or her program.

Although the makeup of these experiences is not finalized, they are currently being created. Stay tuned.

Rice Business introduces their Facebook Live stats October 2016 – February 2017

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newsfeed

RICE BUSINESS IN THE NEWS

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New Business Dean at Rice sees entrepreneurial skills in more demand

By Andrea Rumbaugh October 17, 2016

Congratulations to our Council of Overseers member Lori Vetters.

The most essential things you need in a business accelerator Yael Hochberg, associate professor of entrepreneurship, is quoted about startups and accelerators.

By Staff February 8, 2017

What would happen if Houston-based companies got Yahoo-ed?

Vikas Mittal, the J. Hugh Liedtke Professor of Marketing at Rice’s Jones Graduate School of Business, co-authored a column about security breaches.

By Vikas Mittal and Shrihari Sridhar December 23, 2016

Working under constraints can unleash the best in people Scott Sonenshein wants us to stop chasing.

By Alyson Ward February 4, 2017

Repealed rule would do nothing to end energy industry corruption

By Bill Arnold opinion contributor February 21, 2017

Beyond The Pop: Seven Ways To Unleash Creativity In 2017 Utpal Dholakia and Scott Sonenshein’s research is mentioned.

By David Slocum January 4, 2017

By Jeff Schmitt February 10, 2017

10 books on leadership to read in 2017 Recommended by Grant and Sutton, “Stretch” examines the “science of resourcefulness,” aimed at helping people learn to get the most out of what they have rather than constantly chasing more.

By Jena McGregor December 22, 2016

There’s a very good reason to hire overqualified workers Jing Zhou’s research is mentioned.

By Oliver Staley March 13, 2017

Big things come in small packages Talk about a great brand promise! The positioning is perfect: Don’t overlook us because we can compete with anyone. That’s a high bar to set and no school quite delivers on it like Rice University’s Jones Graduate School of Business.

Class Act Peter Rodriguez takes the reins at Rice.

By Tim Moloney January 31, 2017

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Big oil firms look to save, while smaller upstarts want to spend Bill Arnold, professor in the practice of management at Rice’s Jones Graduate School of Business, is quoted about the oil industry.

By Bradley Olson and Sarah Kent January 29, 2017

Disturbing New Facts About American Capitalism When winners are taking all, it’s often times to buy the winners.

Gustavo Grullon’s research is referenced.

By Jason Zweig March 3, 2017

quotables “ The best thing you can do

for people is expect more of them than they expect of themselves.”

Lynn Elsenhans Rice B.A. ’78, former chairman and CEO, Sunoco; Council of Overseers, Jones Graduate School of Business; “Stretch” Book Launch

“ Hope is a function of struggle.”

Brené Brown, author and research professor, University of Houston, “Stretch” Book Launch

“ Diverse teams perform

better and have better outcomes. But diverse teams are very hard to manage.

We need to train managers how to manage and mitigate conflict. The teams are more successful because everyone doesn’t have the same view and opinions. But that in and of itself creates a healthy conflict that must be managed well.”

Subha Barry ’85 General Manager, Working Mother Media Sparking Success, Diversity Conference

“ When you get to a new job, step up and volunteer for the worst job there.”

William McRaven, Chancellor of the University of Texas System, Navy four-star Admiral and SEAL (retired), Former Commander, United States Special Operations Command, Rice Veterans Leadership Series

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tweetsnappost

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Side Gig: President, Grit Grocery

community around food. Today he envisions a fleet of Grit Grocery mobile units operating in neighborhoods throughout the metro area to address the current gaps in today’s grocery industry.

A native Houstonian and Grit Grocery’s owner and operator, Dustin believes you can’t fake food. It’s either real or not, and your body always knows the difference.

“Grocery shopping outside the U.S. looks very different — neighborhood bakers and butchers across the street from fruit stands and flower shops; small store formats where you are greeted by name and get to know your neighbors. Processed goods are rare, because cooking is both sacred and celebrated.” Dustin Windham

Iman Farrior, a mother of three daughters under the age of four, realized that the cool Pinterest projects she regularly came across online were often too complicated to plan while she was attending business school. Enter Funplugit: a new monthly subscription box with creative projects to help busy parents spend quality time with their children — unplugged from technology.

Co-founded by Iman and her Rice MBA classmate Corey Grodner, Funplugit aims for simplicity and family fun through art, games and science projects. After receiving their first box, each family signs the Funplugit Family Pledge, rings the Funplugit cowbell, reads the simple one-page activity instructions and pulls out the materials needed for that month’s activity. Funplugit’s

ultimate goal is to encourage people to explore unplugged fun with loved ones. No TVs. No cell phones. No gadgets. Just good, oldfashioned quality time.

The unique kid-tested and kid-approved DIY creations come in all shapes and sizes: homemade soap, Mardi Gras masks, bird feeders, game boards, homemade lamps, musical instruments, magnetic slime, pen holders, piggy banks, kaleidoscopes and dreamcatchers, to name a few. Subscriptions begin at $20 monthly and $10 for bulk orders.

“In addition to every other parenting duty and finding time to keep yourself together, it can feel almost impossible to make any kind of quality time like that happen regularly … it is important to my husband and me to spend time with our children laughing, learning and creating.” Iman Farrior

gritgrocery.com

Dustin Windham ’15 Account Manager, SNF Holding Company

Dustin Windham lived in Azerbaijan during his time in the U.S. Peace Corps and ate unprocessed and cooked-fromscratch food. It changed the way his body functioned and felt. And it inspired him to provide Houstonians with the same experience.

His startup, Grit Grocery, was born in the business school while Dustin was an MBA for Professionals student. Grit is a neighborhood grocery on wheels that is changing the food landscape in Houston. Focused on local, natural and unprocessed goods, it sells in urban neighborhoods around the city and is committed to bringing the best of the farm back to the block.

Big box groceries have become dependent on processed goods and conveyance in place of connection with community. Grit Grocery wants to change that and revive the centuries-old tradition of building

SIDE

Iman Farrior Full-Time MBA ’17 Side Gig: Co-Founder, Funplugit Corey Grodner Full-Time MBA ’17 Side Gig: Co-Founder, Funplugit

funplugit.com

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cobuild.us Paul de Meo built a successful high-end construction firm in Hampshire, England, with revenues of $30 million but recognized the limited scalability and inefficiencies that plague the construction industry. The Rice MBA offered the chance to re-evaluate interests and rekindle a long-standing passion to tackle the global crisis of urbanization and the growing inaccessibility of homeownership.

Joining forces with Alex Pichon ’17, formerly of the Federal Reserve, and Sebastian DeGregorio ’15, a marketing specialist, Cobuild was established to modernize homeownership so more people can live, work and play in homes and communities they love.

With the help of Rice Business and some talented coders, the team has developed their beta product — the first part of an end-toend digital house-building experience. Users are matched together based on preferences and connected to recommended builders, leveraging the group buying power. Right now, Cobuild.us is in the final stages of preparing a limited release in Houston to the first

group of customers seeking to build their own homes ahead of a 2017 fundraise. Upon graduation, Paul and Alex will join Sebastian full time and leave the label of side gig behind.

“My wife, Kristin, and children, Henry and Emily, and I have struggled to find a home in Houston that meets our needs. It seems impossible to find a welldesigned, well-built home of modest proportions in a neighborhood with good schools. We’ve since discovered that this is the experience of many others. After 18 months of searching, we’ll be building with one of the first Cobuild communities.”

Paul de Meo

Paul de Meo Full-Time MBA ’17 Side Gig: Co-Founder and CEO, Cobuild

GIGS

My-Handler is a boutique concierge business helping people handle work and life. It’s focused on providing convenient and affordable services that meet the demands of busy professionals, primarily in the Houston area. It is a trusted resource for small business owners, consultants, attorneys, project managers and many others.

Patra Brannon Isaac started her business in 2008 after a career as a corporate auditor that required her to travel up to 75 percent of the time throughout Europe and Australia. While great to work in new and exciting places, it was hard to manage the demands of life at home in Houston being so far away. Many friends and acquaintances complained about the same thing.

When she transitioned into a new career in HR with much less travel, she wanted to help other professionals who faced similar stresses. And her concierge business was born.

My-Handler continues to build new client relationships and help solve the demands of busy Houstonians. Most recently the company was named a Houston Super Bowl LI diverse supplier, providing ad hoc services to assist with special projects organized by the Super Bowl 17

Host Committee’s Business Connect program.

“We felt blessed to play a small role in the success of the Super Bowl LI programming, landing a few contracts and an ongoing client relationship with an NFL representative. We have already received a call for a new project requesting virtual assistant support postSuper Bowl and can’t wait to help handle it!”

Patra Brannon Isaac

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my-handler.com

Patra Brannon Isaac ’11 Regional Director Harris County, Leadership ISD Side Gig: CEO and Chief Handler, My-Handler

impressions “ By far the highlight for me has been the interaction with my fellow classmates in the EMBA program. To be able to draw from the experience and knowledge base of such a high-quality group of working professionals at similar points in their careers is important to me.”

—Ernie Mayfield ’18 MBA for Executives

Lt. Col. Ernest G. Mayfield III flies F-16s out of Ellington Field about three times a week. As part of his job. A graduate of the U.S. Air Force Academy, he has completed more than 17 years as a fighter pilot in the Air Force, two tours in Iraq, and more than 350 hours of combat flying time in a wide range of global joint and multinational aviation missions. This past fall, after becoming director of operations at Ellington Field and keeping the Gulf Coast region safe, Ernie joined Rice Business to pursue an MBA. “I always wanted to get my MBA,” he said. “It was just a matter of when.” Ernie and his wife, Joy — who graduated from the EMBA program in 2006 and was his sister’s best friend growing up in Beaumont — are raising two daughters, age two and four. Despite a no-fail 24/7 homeland defense mission both at work and home, Ernie has loved going back to school. “I’m always excited for class weekends. I find the coursework interesting and relevant not only to today’s business environment but also my own sector in the Department of Defense.”

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“ If you would have told me years ago that I’d be building companies for natural gas pipeline infrastructure, I would have never believed you.

I went to a music conservatory in Chicago for my undergraduate degree, followed by an M.F.A. in musical theater and then moved to New York to pursue musical theater … I’ve now started three companies in the midstream energy space.”

—Chris Staffel ’17 MBA for Executives

A native of San Antonio, Chris Staffel grew up thinking she wanted to be a professional singer. After mastering regional theater and a classical tour throughout Russia and Eastern Europe she got tired of living out of a suitcase and put down roots in New York City. The daily grind of auditions drove her to producing. “I realized I enjoyed the business part of it, equally, if not more than acting.” While she was producing The Dutchman she met two businessmen who were starting a midstream company. “What’s midstream?” she retells it now, laughing. As it turns out, acting and producing isn’t far off from starting and running a company.

“You have to raise the capital, hire actors, market the show, and of course … perform.” Even before moving to Houston, she sat in on some classes at Rice and was sold on earning an MBA. “It’s been excellent. I’ve learned so much … The network is incredible.” Since the sale of her compnay in November, she’s curious about the next global opportunities on the horizon in energy and plans to travel to various emerging markets after graduation. “I want to see where the next possibilities are.”

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event

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M

cNair Hall’s Shell Auditorium was filled to the last row Feb. 9 for the launch of “Stretch: Unlock the Power of Less — and Achieve More Than You Ever Imagined,” a new book by Scott Sonenshein. The school assembled a panel of business and thought leaders, moderated

by Sonenshein, for a discussion of how “stretching” improves organizations, careers and lives.

The book, which hit bookstores just two days earlier, provides a groundbreaking approach to succeeding in business and life using the science of resourcefulness.

The concept of “stretching” is about learning to work with the resources one already has — including time, money, connections, knowledge and tangible objects — to achieve a business or personal goal. “Chasing,” the opposite of stretching, is about constantly comparing one’s organization or oneself with others, and believing that you need the same resources they have to be successful and happy.

In his research, Sonenshein found that chasing actually makes people less satisfied and stretching leads to more fulfillment. The book also found that

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businesses are less stable when they throw money around to grow instead of drawing creatively on the assets and resources they already have, including people. This was a phenomenon Sonenshein himself witnessed at a dot-com in 2000, early in his career, when he was recruited for a Silicon Valley job. The startup company was growing fast and spending lots of money on parties and workplace perks. That lasted just a few months, when, as he writes in his book’s introduction, “the money train screeched to a halt, venture capital dried up and we desperately but unsuccessfully tried to adapt to no longer having a blank check.”

Sonenshein, a social scientist who drew on years of personal and academic research from a range of disciplines to make his book’s case, was lauded by Jones School Dean Peter Rodriguez as a prolific and innovative scholar. “It’s not just that he’s created this great opportunity to learn about stretching, improving your life … but he serves as this great emblem for what the research is about and what it’s for, and for that we’re extraordinarily proud of this event as well as for Scott.” —By Jeff Falk

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excerpt

In the fall of 1961, a headstrong teenager named Dick left rural Pennsylvania to attend a military high school 150 miles away. Its rigid schedule and strict rules required students to rise early, dress in naval-style uniforms, and salute instructors.

It was a far cry from his hometown life, where friends called him “Party Boy”— a fitting nickname for the son of a regional brewery owner who’d begun working in the family’s warehouse stacking cases of beer a few summers back.

W

hen his parents visited a month into the term, Dick begged them to take him home so he could learn about the family business. They refused. With the industry struggling, they hoped their son’s new surroundings would inspire him to pursue a more promising future away from beer.

Dick had other plans. After convincing a maintenance man to give him civilian clothes, he climbed a tree and jumped over a wall to escape the forty-acre campus. He hopped on a bus to Philadelphia before hitchhiking home, unable to stay away from the brewery he loved. His return home with little more than the clothes on his back would foreshadow the resourceful way he would ultimately go on to turn the struggling family enterprise into one of the country’s most successful beer producers, becoming a billionaire at the time his chief rival squandered what could’ve turned into a nine-billion-dollar company.

Started in 1829 as the Eagle Brewery by his German ancestors, the business had outlasted scores of other brewers by the time Dick took over for his

ailing father in 1985. The three major players — Anheuser-Busch, Miller, and Stroh — controlled 70 percent of the national beer market. Dick’s brewery put out a modest 137,000 barrels annually, a drop in the bucket of the close to 200 million barrels produced nationwide. Faced with competition from these mega-companies, smaller producers typically took one of two paths. Some gave up as independents and sold themselves to competitors. Others tried to grow rapidly through acquisitions.

Dick rejected both options. He wouldn’t sell, and he wouldn’t buy. Instead, he’d find better ways to work with what he had to build a prosperous business he’d enjoy running.

Although big marketing dollars typically drove beer sales, Dick found ways to get more out of his modest advertising budget. He built awareness by tapping into his company’s rich but underutilized history. America’s oldest brewery had a type of appeal that separated its products from the three major producers.

Instead of entering as many markets as possible, Dick limited sales to only a handful of regions, cre-

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ating a sense of scarcity that drove more demand. A cultlike group of fans would cross state borders to buy the hard-to-get beer, lending a mystique to the brand.

Several enthusiasts became the beer’s best, and free, advertisers, and even started campaigns to appeal to the company to come to their part of the country. As his business grew, Dick purchased used tanks, bottlers, and labelers—giving them a second life.

By 1996, Dick’s efforts to get the most out of his 150-plus-year-old factory were so successful that the five hundred thousand barrels the company brewed finally maxed out the facility, which had been built to produce only about half as much.

Before investing in another plant, he consulted with his most important partners—his four daughters. With only three percent of family businesses making it to the fourth generation or beyond, he wanted to gauge their passion for becoming sixth generation owners. Only after they enthusiastically expressed interest did Dick see a purpose in continuing to grow the business.

Dick’s company, D. G. Yuengling & Son, grew into America’s largest domestically owned beer producer. But that was never his goal. “We were not in any race to be the largest domestically-owned brewer,” he reflects. “Our game is longevity . . . My daughters . . . are in the business now and we want their kids to be able to run it some day. That’s what’s satisfying to us.”

Forbes estimates the blue jeans- and sneak er-wearing leader of the beer giant has a net worth of close to $2 billion. Even with all of his wealth, he still drives a modest car and regularly turns off lights left on at the office. “They say I’m cheap,” he told me, “but I’m economical.” His motto — to work with what he has and make the most out of it — helped him achieve 23

the elusive goal of creating a thriving and sustainable business he enjoys running alongside his children.

What made Dick so successful and satisfied when so many other breweries went bust, running themselves and their companies into the ground?

As a social scientist and Rice University professor, I’ve spent over a decade studying what makes organizations more prosperous and the people who work inside them better off. I’ve researched, consulted with, or worked at organizations in industries as diverse as technology, manufacturing, banking, retail, energy, health care, and nonprofits, spending time with top executives at Fortune 500 companies, entrepreneurs launching their businesses, front-line employees trying to make a difference, and everyone in between.

What I’ve found in my research, and what a growing body of scientific evidence supports, is that how we think about and use resources has a tremendous influence on professional success, personal satisfaction, and organizational performance. We routinely overestimate the importance of acquiring resources but even more significantly underestimate our ability to make more out of those we have.

Whether adapting to major changes, going about everyday routines, or trying to carve out meaningful careers and lives, my research explains how people and organizations can expand their resources to achieve great things and feel fulfilled — to stretch.

Stretching is a learned set of attitudes and skills that comes from a simple but powerful shift from wanting more resources to embracing and acting on the possibilities of our resources already in hand.

This excerpt is from “Stretch” by Scott Sonenshein, the Henry Gardiner Symonds Professor of Management. Copyright © 2017

by Scott Sonenshein. Reprinted courtesy of HarperBusiness, an imprint of HarperCollins Publishers.

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SUPER BOWL

HOME FIELD ADVANTAGE

Investors Buy What They Know • Advertising doesn’t just reach potential customers.

It reaches potential investors.

• Investors have a home bias — they invest in what they know.

• Increasing advertising broadens shareholder base.

In the 2016 Super Bowl, 30 seconds of commercial airtime cost up to $5 million. How did the H. J. Heinz Company spend their expensive time?

With a pack of dachshunds dressed like hot dogs racing in slow motion toward owners dressed like ketchup bottles.

The Heinz “Weiner Stampede” was a viewer favorite, and a fine investment it was. Absurd, yes, but it not only prompted shoppers to remember Heinz at the store —

it probably nudged Wall Street investors to buy shares.

Product sales, a team of business school researchers have found, are just one way to measure marketing success.

While most people think of brand recognition simply as a way to reach consumers, there’s another important constituency that responds to familiar names and products: investors.

A study coauthored by finance professors Gustavo Grullon, George Kanatas and James P. Weston shows that when firms spend more on advertising, they attract significantly more investors. This so-called “home bias” sways individual investors more than it moves institutional investors. But its effect on both is the same: a disproportionate number of investors are drawn to a stock based on familiarity rather than more fundamental information.

“People buy on impulse and on recognition,” Weston explained to Fortune. “With more and more online

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trading taking place, companies that spend money on big advertising campaigns see this additional benefit from their advertising investment.”

The Rice team’s research was based on a sample of 5,776 firms. Their findings showed that on average a 10 percent increase in advertising expenditures increased the number of independent shareholders by 2.7 percent.

Institutional shareholders climbed 0.5 percent.

With more investors, a firm’s shareholder base and liquidity grow. And since a firm’s visibility may increase the breadth of ownership and improve liquidity, it is possible that brand familiarity can also increase a firm’s overall value.

This research has important implications for firms considering the economics of advertising. Old-fashioned marketing — the kind that emphasizes pets, funny slogans, familiar images — influences more than customers.

It persuades investors.

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Just follow the dachshunds. As the weenie dogs barrel their way across the Heinz commercial, a voice-over tells viewers, “It’s hard to resist great taste.” Whether investing in ketchup or stock shares, buyers agree.

Gustavo Grullon, George Kanatas and James P. Weston are professors of finance at Jones Graduate School of Business at Rice University.

See RiceBusinessWisdom.com To learn more, please see: Grullon, G., Kanatas, G., & Weston, J. P. (2004). Advertising, breadth of ownership, and liquidity. Review of Financial Studies 17, 439–461.

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FIXER UPPER

PHOTO: ED SCHIPUL

Saving the Dome

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27 SPRING 27 SPRING 2017 2017

Top to bottom: January, 1964, Astrodome construction, NRG Park; 1963, Architectural rendering, Ralph Anderson, Jr.; 1964, Contruction, interior view, Lloyd and Morgan Architects; 1964, Aerial photograph during construction, Art Meyer Photography

P

hoebe Tudor knows how to save a building. With a master’s in historic preservation from Columbia University, Tudor and her husband, Bobby, moved to New Orleans, where she served for four years as the architectural historian for the New Orleans Historic District Landmark Commission.

The philanthropicallyminded couple found their way to Houston a few years later. Here, Tudor served on the Archeological and Historical Commission, helped strengthen the city’s preservation ordinance and was instrumental in the formation of a group that restored the

1926 Julia Ideson Building, designed by Ralph Adams Cram as Houston’s Central Library. Led by Tudor and preservationist Minnette Boesel, the Julia Ideson Library Preservation Partners raised the $32 million for the restoration, which included the addition of an archival wing that houses the Houston Metropolitan Research Center.

That’s one place where you can learn the history of a city that is often accused of having “amnesia” as another landmark is torn down, replaced with something new and forgotten. You can study, for example, some of the original blueprints of the Harris County Domed Stadium — or the Astrodome, for short.

And it’s the Astrodome Tudor has her sights on

[

next. “It’s a great asset for Houston,” Tudor says. “It’s one of our biggest icons, honestly, and we’re worried about what’s going to happen next.”

Completed in 1965 in the midst of the Space Race, just a few years after President John F. Kennedy’s famous call to action at Rice University, the Astrodome opened to international wonder. It was the first — and best, many still argue — of its kind. An architectural feat. An engineering marvel. A pinnacle of technology. All the superlatives seemed to apply. Aside from its one-of-a-kind design, the Astrodome played host to important competitions — from the Game of the Century between the University of Houston and UCLA to the Battle of the Sexes between Billie Jean King and Bobby Riggs — and performances — from Elvis to Selena to Evel Knievel — until the early 2000s, after the Houston Oilers had relocated to Tennessee and the Astros

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]

to a new stadium downtown. The Astrodome’s last great moment was in 2005, when it was a temporary shelter for residents who evacuated New Orleans during Hurricane Katrina.

It has been vacant ever since. It is paid for, but it costs Harris County taxpayers about $170,000 a year — most of which covers the electric bill. In 2013, voters failed to approve a bond that would have paid for a $217 million renovation into a convention center. When that vote failed, many feared it was a death knell, and the Astrodome would be demolished, once and for all.

What happened instead was a resurgence of interest and passion around what many others considered one of Houston’s greatest cultural assets. Just one year later, the Astrodome was listed on the National Register of Historic Places. Then, in 2017, it became a State of Texas Antiquities Landmark, granting it protection from demolition or unapproved alteration.

Beth Wiedower, a senior field officer for the National Trust for Historic Pres-

[ ] ervation, says: “It’s not the only piece of our cultural identity, but it is a big piece of our shared cultural story, as Houstonians. And that has big-picture implications of how we define ourselves as a city and how we relate to each other.”

Now, explains Wiedower, the conversation has changed. “It’s not, ‘Should we save [the Astrodome]?’” she says, “but what are the mechanics of saving and repurposing it? How do we go about this?”

This is where Tudor comes in. Answering those questions, she says, “is my passion and my great interest and my professional training.”

Teaming up again with Boesel and art historian and curator Judy Nyquist as founding board members and officers, Tudor established the Astrodome Conservancy in 2016. The Conservancy, says Tudor, is “an independent nonprofit.” It has federal 501(c)3 status and an eight-member board, which includes Wiedower.

“We are now going down the road to become the official county partner,”

Top to bottom: 1970, Astrodome exterior, Gulf Photo; Sept. 20, 1973, Battle of the Sexes II, NRG Park; 1997, Astros baseball, NRG Park

Tudor says.

There has never been a shortage of good ideas about what to do with the Astrodome. The Urban Land Institute recommended that it become the centerpiece of a new public park. Architect James Richards proposed that it be stripped to its structural skeleton and wrapped in a several-miles-long hike and bike trail that curlicues up around it. The question, though, always begins and ends with how to pay for it.

Tudor, Boesel and Nyquist have inverted the path, starting with the same financial model that worked for them on the Julia Ideson Building and that has become increasingly popular in Houston: the public-private partnership. It’s the model that allowed the City of Houston to develop Discovery Green, Buffalo Bayou Park, Bayou Greenways and other public amenities, and Tudor believes it will help Harris County

[ [ 29

transform the Astrodome.

“It’s working,” Tudor says.

“It’s been hugely successful.” The strength of the public-private partnership is that it can “take on responsibility for city assets that are underutilized and underappreciated and that need something more than the city can provide.”

It’s too early to say just what that transformation will look like. Though a bill proposed by Texas Senator John Whitmire would require state oversight before Harris County can spend money on the Astrodome, the Harris County Commissioners unanimously approved a $105 million plan to begin bringing it back to life. The floor is set to be raised and a revenue-producing parking garage installed underneath.

Meanwhile, the Astrodome Conservancy

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is focusing on fundraising and advocacy. The Conservancy hired HR&A Advisors, consultants who are helping with visioning short-term, site-specific art installations and activations. “Then we start to do what conservancies do in these situations,” Tudor says. “They raise private funds. They won’t be taxpayer funds. And they can come from all sorts of sources.”

“I thought it would be terrible, terrible for the city, that the final result would be that it would be torn down. We don’t need to lose the Astrodome,” Tudor insists. “We are at a new moment, and it’s exciting.”

[

—By Allyn West

[

A Seat at the Table It’s dusk at Rice University’s business school. From an outdoor patio, voices, laughter, drift skyward. As darkness falls and the crowd grows, Peter Rodriguez, the school’s new dean, appears.

Behind him wait large quantities of champagne, perfect for toasting. Bloomberg Businessweek has just ranked Rice’s full-time MBA program No.8 in the country, allowing a young Sun Belt business school to shake up a top 10 list that has seen little change for decades.

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8 Wbreaking into the top tier, on this particular list, hile all school rankings are somewhat illusory,

may be transformative for the small school.

“However flawed these rankings are — and every single one has significant issues associated with them — these lists have a very big impact on a school’s reputation and standing,” says John Byrne, who in 1988 created the first regularly published MBA ranking for Businessweek.

Breaking into the magic circle, it turns out, can translate into surprisingly tangible results. A top 10 ranking draws increased and more-qualified applications, heftier donations, and more plentiful corporate recruiters. It encourages minority candidates — underrepresented in business schools nationwide, and courted through recruiting and scholarships — to see the newcomer school as an option.

There’s also a less-tangible aura to such lists. Historically, most of the schools on top 10 lists have simply swapped places in a kind of grad school musical chairs.

Rice Business is not only the rare upstart to grab a seat, it’s the youngest. And it has moved into its new spot very fast.

On the Businessweek list, Rice was No. 19 last year, No. 29 in 2010 and not ranked at all in 2006. It topped venerable business programs at Northwestern, the University of Virginia, Columbia and the University of Michigan. Rice even topped Yale, which made its own meteoric jump, from No. 25 in 1990 to No.10 in 2009, on the similar MBA list compiled by U.S. News & World Report.

When schools win in this poker game of sorts, they win big. But if they lose, says Byrne, now editor-in-chief of PoetsandQuants.com, the pain can be sharp. Slipping a few percentage points, can mean a drop in applications and alumni giving, even threaten the job security of a school’s top leaders.

Before any dean breaks out in hives, though, Byrne offers this advice: “Treat rankings with a big grain of salt. A school’s rank on one survey in one year is pretty much meaningless. What’s important is a school’s rank over time and over multiple rankings. That is how rankings get to the greater truth about where an institution truly stands among its competitors.”

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The Rice alumni surveyed this year, accounting for 30 percent of their school’s ranking index score, represented the classes of 2008, 2009 and 2010. The Houston economy seemed recession-proof during those years. Jobs were abundant and salaries stable.

More recently, Houston has been hurt by a struggling energy sector, “which could affect Rice’s scores down the road,” says Lance Lambert, the business school ranking coordinator for Bloomberg Businessweek. “The rankings are really lagging indicators.”

Not to worry, says popular culture guru Robert Thompson, who was only mildly surprised when he saw Rice nipping at the heels of the likes of Harvard in the latest Businessweek ranking.

“It’s not like I spit out my coffee,” says Thompson, trustee professor of television and pop culture at Syracuse University. “On one level, the success of a relatively new university in a Sun Belt city might look like a real cultural shift. But it’s not like Rice is chopped liver. ” Thompson says the mystique associated with iconic universities of the Northeast is fading, “depending on how old you are, where you’ve been and what you know,” while schools such as Rice are on the move and catching up.

“I think of Rice as one of the hoity-toity, mystique places now,” says Thompson.

The challenge for Rice, most experts agree, is to keep or improve their seat at the rankings table — while remembering that the strength of the program has everything to do with imagination and hard work and little to do with any list.

Sipping their champagne and pinching themselves this fall evening, Rice Business students and professors perhaps are thinking the same thing. “I’m stunned,” says Rodriguez during a short speech in which he repeats the words “thank you” five times.

Rodriguez arrived on campus in July; he tells students he had little to do with the new ranking. Instead, he gives credit to his predecessor, William Glick, and suggests that they all enjoy the festivities, then get back to work.

“We have to do it again,” Rodriguez says. “We have to prove we’re not a blip.”

—By Claudia Feldman

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Best of Intentions The right decision but not a cause to celebrate

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resident Donald Trump in February signed into law legislation that repeals a Dodd-Frank securities disclosure rule aimed at curbing corruption at energy and mining companies. The action by the Trump administration was appropriate but gives no cause for celebration.

It was a recognition that the law was discriminatory against American companies and would have been ineffective. Now the energy and mining companies should work with the new administration to strengthen transparency in their industry. It is grinding work, but ultimately can be effective.

The world needs greater transparency to limit corruption that saps democracy and undermines development. Funds intended to support infrastructure, education, public health and other important functions all too often have gone to private bank accounts to support luxury lifestyles of government officials from developing countries. This and broader mismanagement of countries’ finances is often referred to as the “resource curse.” Some of the biggest transfers to the developing world —

after military and official transfers — come from the energy and mining sectors. The scope of their investments can be enormous. A single contractual payment to secure licenses or leases may amount to hundreds of millions of dollars, or even more.

The U.S. Foreign Corrupt Practices Act (FCPA) has been an important tool for many years,

imposing jail terms and fines for individuals and massive fines for companies that have been found guilty of violations. This has been an important tool that U.S. and foreign companies ignore or circumvent at their peril, as the record clearly shows.

The Department of Justice and the Securities and Exchange Commission had been pursuing about two dozen cases

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annually. Apparently companies got the message, and the cases dropped to 11 in 2014 and six in 2015.

In 2009 Siemens reached an agreement to pay $800 million in fines, and in 2013 Total of France paid a fine of $398 million for having paid $60 million in bribes.

Complementing this is the Extractive Industries Transparency Initiative (EITI), which includes 51 countries.

It treats all companies equally as it promotes “public awareness about how countries manage

their oil, gas and mineral resources,” according to its website. The initiative is a continuous process that highlights problems and offers courses of action, but it is not necessarily a prescription to cure the disease quickly.

Its website provides substantial data on scores of countries — from Organization for Economic Cooperation and Development member countries to some of the poorest — and their progress in implementing updated standards.

In the last months of

the Obama administration, rules were created under the Dodd-Frank legislation to force American companies — and only American companies — to disclose all kinds of payments to foreign governments. Corrupt payments are already covered under FCPA, but Dodd-Frank would require them to disclose proprietary information to the public — including their competitors. This includes what they paid to win licenses in public tenders. Companies always would like to know

the bidding strategy of their competitors — so they can improve their own chances the next time around. Corrupt officials prefer shadows over light. As implemented, Dodd-Frank would have been ineffective at fighting corruption, but would make American companies uncompetitive in many countries. Unfortunately, corrupt officials have options to select companies from countries with less onerous (or no) provisions.

Investing in mineral-rich countries has

never been easy and standards tend to shift, even after contracts have been honored and operations begun. Recently Nigeria seized a $1.2 billion oil field from Royal Dutch Shell and Italy’s ENI that was related to a 2011 purchase of an oil-prospecting license from a private Nigerian company headed by a former Nigerian oil minister.

Officials now claim that only $210 million of the $1.2 billion paid ultimately found its way to the state oil company. The companies point out that the payments were made to an official Nigerian government escrow account at the London branch of JPMorgan Chase, and the justice minister at the time authorized its distribution. To what extent should companies be held liable?

Congress acted under the Congressional Review Act to overturn the DoddFrank rule and Trump signed it into law. While this action was appropriate, it should not pause efforts to fight corruption, which penalizes the people of the countries involved and raises the cost of doing business for all parties.

—By Bill Arnold Bill is professor in the practice of energy management at Rice Business.

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Reprinted with permission

by TheHill.com

&

The intersection of art ideas: a conversation

moody.rice.edu Alison Weaver

A

lready named by Architectural Digest magazine as one of the best new university buildings in the

world, the Moody Center for the Arts opened at the end of February to rave reviews as a vital addition to the campus and the City of Houston.

The 50,000-square-foot center, designed by renowned Los Angeles-based architect Michael Maltzan, serves as an internationally focused arts institution, built as a free public platform for creating collaborative works of all kinds and for presenting innovative, transdisciplinary experiences to the public and the university community.

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A: No! Houston’s a very urban and sophisticated city, and over the years it’s become more densely populated and diverse. Moving back has been a great thing.

Q: The art center opening lasted four days. What happened?

A: We focused on the intersection of art and ideas.

For example, there was a talk that featured Thomas Struth, a photographer who creates images of space exploration and highly technical environments. So we had a panel discussion with Struth, Douglas Terrier, NASA’s chief technologist, and Rice professor James Tour, who focuses on nanotechnology. It was a truly interdisciplinary discussion, which is something we want to foster.

PHOTOS: NASH BAKER

Alison Weaver, the center’s executive director, stresses that she is not an artist but an art historian. Her insistence contradicts the creative mind that was instrumental in bringing Houston’s newest arts institution from construction to completion in roughly 18 months.

After celebrating the center’s opening, Weaver took a moment to reflect on her career and her hopes for the $30 million project on the Rice University campus.

Q: You have two advanced degrees in art history and an MBA. How do those degrees fit together?

A: For much of my adult life, I lived in New York City, worked in business and spent all my free time in art museums. But finally I realized I could combine my vocation and avocation and commit to the arts. What I found is that management skills and a passion for art make a terrific combination.

Q. You’re a Houston native.

When you moved back to town in 2015, did you feel like you were coming back to Hicksville?

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Another favorite of mine is “Green light — An artistic workshop,” which calls attention to the international refugee crisis. We partnered with Interfaith Ministries of Greater Houston to work with a group of recently arrived refugees to make, alongside students and volunteers, stackable modular green lamps designed by Olafur Eliasson. A portion of the proceeds from the sale of the lamps will benefit Interfaith Ministries.

We really do want broadbased conversations appealing to a wide variety of visitors on campus and in the community.

Q: What are your limits?

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A: We have no limits. We have this beautiful building, and we want to use the space to connect the campus and the community.

We’re right by Entrance 8, the most used entrance on campus, and we want people to come and visit.

It’s open to the public five days a week, admission is free, and we have a cafe.

We’re hoping students and other visitors will come and get coffee and a snack and see our programs. It’s so exciting. At Rice, people talk about living “inside the hedges.” We hope to break down that barrier.

Q: Judging from the opening, you want to go far beyond the campus hedges.

A: Of course. Our first artist-in-residence is Mona Hatoum, a fabulous Beirut-born Palestinian artist, who is coming this spring. Then she’ll be back in the fall for a major exhibition at the Menil Collection.

That way we can have a longer conversation, which is so much better than dropping in for a lecture.

—By Claudia Feldman

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JAMES ZHAO ‘15 NATIONAL PARKS TOUR (in his spare time)

After spending over an hour cleaning the snow off of my car and the driveway with a camera tripod, I was finally able to get out of the cabin to capture this shot of Yosemite Valley. Winter in Yosemite is every bit of unpredictable and rewarding. Watching the fog hugging the valley floor and slowly climbing up El Capitan is definitely one of the most surreal experiences. “Nature does not hurry, yet everything is accomplished” – Lao Tzu

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SPRING 2017

Shopping for Customers

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If American department stores are to survive, they have to become destinations in themselves again

Lucy Kruse loved the smell of perfume enveloping her as she entered the department stores of her youth. She remembers trying on soft leather gloves and following a splash of color to the store’s elaborate hats with their feathers and veils. At Sakowitz in Houston, she peered into the Sky Terrace restaurant to see fashion models sashay past the tables.

From the Christmas windows

of Marshall Field’s in Chicago to the extravagance of Neiman Marcus in Dallas, department stores once defined the modern retail experience. Created to be emporiums of pleasure, however, today they are falling off the map.

By Mary Lee Grant

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“They have added different entertainment elements, like ice skating rinks and cinemas and children’s playgrounds.

Shopping is more experiential in China. It is not just grab something and go.”

Last August, Macy’s announced the closing of 100 stores nationwide, which would result in layoffs for about 10,000 workers. The closings include three stores in Houston: Greenspoint Mall, Pasadena Town Square and West Oaks Mall.

During January, Sears announced that it will close 150 stores by April — 10 percent of its locations. The company shuttered 78 stores last year and more than 200 in 2015. JCPenney, meanwhile, has announced it will be closing branches too.

The cause, most experts say, is online shopping.

“The short answer is Amazon.com,” said Harold Livesay, a professor of business history at Texas A&M University and author of “Andrew Carnegie and the Rise of Big Business.” “The long answer is FedEx, UPS and the internet. The infrastructure is reliable and so is the ease of delivery. You can shop from home, and don’t have to schlep to the store.”

There’s no doubt that e-commerce plays a substantial role in the demise of department stores. But customers may not be abandoning department stores just because they want to shop in their pajamas from the couch. Yet there may be more to the story. Paradoxically, while department stores are failing in the U.S., in China many are thriving.

According to recent research, about a third of China’s urban dwellers shop at department stores more than once a week.

“Department stores in China are suffering from online competition too, but they are doing better than in America because they have a different kind of concept of what a department store is,” said Haiyang Li, professor of strategic management at Rice Business

“They have added different entertainment elements, like ice skating rinks and cinemas and children’s playgrounds and restaurants. Shopping is more experiential in China. It is not just grab something and go.”

Department stores in the U.S. once offered this sense of excitement. Even small towns boasted department stores that were destinations. When Kruse, now 94, was growing up in Kingsville, she found it thrilling to take the area’s only escalator up to the tea room for lunch at Ragland’s.

But Kruse doesn’t shop much at department stores anymore, even though she is healthy and fit.

Instead, she shops online or orders out of catalogues.

“Department stores used to be more elegant, and the staff was well-versed about the products,” she said.

“The clerks really aren’t very helpful anymore. Shopping has become a chore and there is almost too much to choose from.”

In contrast, the Beijing-based Shimao department store recently reduced its retail floor space from 80 to 20 percent and added restaurants and entertainment areas. In Hong Kong’s Crawford Lane, concierges assist customers on every floor and 60 personal stylists stand ready to help shoppers craft their own individual chic looks. And in Shanghai, when the upscale French department store Printemps opened a branch it included a five-story high-speed slide in the shape of a dragon so shoppers could swish from the top floor to the bottom.

The Chinese stores hark back to a time when service, extravagance and play characterized European and American department stores. The department store became the epitome of elegance and luxury in

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“People go online for some kinds of things, but they also want to go shopping so they can enjoy the unique environment the stores create. ”

the late 19th century, as entrepreneurs invented a new style of consumption in which shopping equaled pleasure. French author Emile Zola set his novel “Au Bonheur des Dames” (“The Ladies’ Delight”) in the Paris department store Le Bon Marche. As the owner enticed his female customers into purchasing an exotic array of appealingly arranged goods, the dramatic customs of this new institution unfolded among the staff.

In the United States, from the 1890s into the 1960s, American department stores hired the best architects to design their flagships on prime downtown real estate. Each store’s restaurant boasted a signature dish, from deviled crab to chicken velvet soup. Filene’s offered a health menu, from which weary shoppers could refresh themselves with potassium broth, acidophilus milk or a cold glass of kraut juice.

These stores played a central role in a city’s identity, too. Their tall clocks were meeting places where memories began. Any child born in Georgia received a birthday card from Rich’s. In Dallas, Neiman-Marcus offered its famous his and hers gift at Christmas, with offerings ranging from airplanes to mummies to live camels. In Chicago, Marshall Field’s was such an institution that after the bombing of Pearl Harbor, one woman reportedly exclaimed, “Nothing is left anymore, except, thank God, Marshall Field’s.”

Chinese department stores, where shopping tends to be a group activity, today play a similar communal role, Li said. The stores offer a stage for the new middle and upper class to parade their status and a familiar hub where family and friends reconnect. They’re even associated with romance.

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Chinese branches of IKEA have become such popular places for Chinese in their 70s and 80s to go on dates that IKEA has made new rules limiting the length of their stays.

“My thought is there is differentiation in China,” Li said. “People go online for some kinds of things, but they also want to go shopping so they can enjoy the unique environment the stores create. In the United States, there is no need to go to Macy’s. You don’t add any value by going there.”

At least for now, Chinese retailers seem to think both shopping styles can coexist. The same week Macy’s and Sears announced their closures, Chinese online retail giant Alibaba revealed that it would become the controlling shareholder of the Chinese department store and mall company Intime, and would begin integrating its enormous e-commerce assets with Intime’s brick and mortar stores. Rather than foreseeing competition with physical stores, Alibaba plans to tap the latest technology to draw customers to stores, including artificial intelligence, virtual reality and Internet-of-Things.

If department stores in the West are to survive, they may have to somehow recapture a time when they were destinations in themselves — a time when women like Lucy Kruse were excited to ride the escalator and savor lunch in luxurious surroundings.

They may have to revive the art of customer service.

And they will have to figure out how to blend the convenience of technology with the real-life scent of perfume and the warmth of crowds.

This article originally appeared online in the Houston Chronicle’s Gray Matters.

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around the water cooler

|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||| Class of 1982 In January, Jay Oliphant was named principal financial officer of Ecoark Holdings, Inc. He has experienced the joy of being newly public, handling a merger, an acquisition, an S-1 filing, implementing cloud-based ERP system and complying with Sarbanes-Oxley. Fun year!

Rick Reinhard has been appointed chief administrative officer of the United Methodist General Board of Church and Society, the global church’s public policy arm, in Washington, D.C. His husband, Idgla, a native of Brazil, just earned his U.S. citizenship.

respective jobs at ExxonMobil and Showtime Networks and move to our retirement ranch in the beautiful Texas Hill country. A mom’s just gotta brag — our son Carl left high school as a National Merit Scholar, is a physics and mathematics honors student at University of Texas, has been working for a UT professor who is on the CERN Atlas Project and was just accepted for a summer research fellowship at CERN in Geneva, Switzerland.

Europe, here we come!

I look forward to catching up with all of you at our upcoming class reunion!

Class of 1985 In June 2016, Carol Del Garry celebrated her five-year anniversary as associate director at the Public Company Accounting Oversight Board in the Division of Enforcement and Investigations in Washington, D.C.

Class of 1991 Melanie Levine moved to Miami, Florida, where she spends her time helping others relocate. If you are moving to South Florida, let her know. She has her real estate license and can assist with planning the move, finding a neighborhood and renting or buying a home. Her new email is melaniejlevine@gmail.com

Class of 1987 From Mary Bourne-Marth.

Hi Class of ‘87! Angela, Tony and I are busy planning our 30-year reunion April 21–22 in Houston — can you believe it has been that long?

Please make plans to attend!

On a personal note, my hubby and I are empty nesters now, counting down the days that we can leave our

Jim Watson is chief operating officer of Park West Asset Management LLC, a hedge fund located in Larkspur, California. He is also extremely honored to have been elected chairman of the board of the Celiac Disease Foundation, the leading voluntary health organization for celiac disease. Jim was diagnosed

with celiac disease in April 2012 and with microscopic colitis in August 2013. If you or someone you know has celiac disease, he urges you to contact him or have them contact him and get involved. CDF is an amazing organization that Jim is proud to be a part of and they need your help. You can reach him at jwatson@ alumni.rice.edu.

Class of 1997 Jeff Jung recently returned to the U.S. after living in South America for years, mostly in Bogota, Colombia. He’s married, back in Texas, and proud owner of two bulldogs.

Jeff is currently the vice president of marketing and reimbursement for a startup medical device company focused on epileptic seizure detection, monitoring and diagnostics.

Class of 1999 Amy Anton (neé Way) has started a local business called Kitchen Underground, based in Houston and Austin so far. Local chefs post small scale cooking classes that they give out of their homes. It is a fun way to spend the afternoon with friends or to meet new people in your area. Check it out at www. kitchenunderground.com or follow us on Instagram at @kitchen_underground to see what they are cooking.

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Class of 2000 Holly Davies (neé Arney), founder of CERT Willow Meadows, was recently honored with the President’s Gold Volunteer Service Award for flood-related relief work from the Memorial Day 2015 and Tax Day 2016 floods in Houston. This is a civil award bestowed by the President of the United States to people with 500 or more hours of volunteer work in a calendar year.

To find out more about volunteering with your local CERT (Community Emergency Response Team), please go to https://www.fema.gov/ community-emergency-response-teams Russell Starbird moved to Half Moon Bay, California, where he continues his legal practice, advising businesses and individuals on litigation and contract matters (trade secrets, drafting/enforcing contracts, fraud — yes; car wrecks and dog bites — no). Love it here! Half Moon Bay is conveniently located on the coast, halfway between San Francisco and Silicon Valley, So, if you visit or live in the Bay Area, he can meet you.

Or stop by and get lunch at Flying Fish Grill or grab a snack at Nano’s Yogurt Shack. Email him at russell. starbird@gmail.com, or call or text at (415) 509-0844.

Photos: 1. Turner Hoff (’13) and his girlfriend, Ariane Valle 2. April Frazier’s (’11) daughter, Lily Dane 3. Jamie Ortegon (’12) and Jennifer Neely Ortegon’s (’12) son, Juan Carlos Ignacio 4. Mary Bourne-Marth (’87) and her family in the Hill Country 5. Bishr Tabbaa (’09) and Mariluna Hernandez were married in September 6. Charlie Tidd’s (’09) daughter, Marie Andree 7. Hermine Bernard’s (’12) daughter, Amelie Fehres 8. Jared Field’s (’12) daughter, Elizabeth Anne 9. Pattie Le (’09) with her husband and son, Makai

Class of 2001 Bethany Andell, president of Savage Brands, recently published a compelling business leadership book with co-author Jackie Dryden called “Get Your Head Our of Your Bottom Line… And Build Your Brand on Purpose.”

Class of 2004 Andy Aweida sends cheers to fellow owls. The newest business to his current portfolio is Heights Bier Garten and Worcesters Annex located at 1433 N Shepherd. This complements his existing entertainment businesses — Woosters Garden, Taps HOB, Taps Fabrika (in Singapore) and Vrsi Niteclub. They always enjoy having current and former students stop by and enjoy themselves. He hopes to see many of you soon at any of the locations.

Vaishali Jadhav is one year into her role as the director of learning and culture for 365 by Whole Foods Market. In her role, she creates operational learning, development and cultural programming for Whole Foods Market’s newest store concept and has supported the opening of its first three stores in California, Oregon and Washington. She comes to this position after five years at Whole Foods Market, working on a number of tal-

ent management initiatives, including leading the Global Support Conscious Leadership program, co-producing Whole Foods Market’s first company-wide Team Member Innovation Challenge and rolling out its first talent competency model. She is a passionate supporter of Conscious Capitalism and welcomes the opportunity to share what she’s learned about the balance of higher purpose and profit!

After losing her mother to ovarian cancer, Runsi Sen created Ovarcome, an ovarian cancer foundation with the mission to raise global awareness, fund research in search of a cure and provide financial assistance to ovarian cancer patients in need. In five years, Ovarcome has committed more than $100,000 in research, has helped many women with their OvarCare financial assistance program both nationally and internationally and has hosted several seminars and awareness campaigns to raise awareness on ovarian cancer worldwide. Dr. Binata Mukherjee, director of the health care initiative at Rice Business, has joined their advisory board in the crusade against cancer.

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Class of 2006 Henry Bragg is now a partner with Hill Investment Group. He started the 43

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Houston office for HIG in 2014. The office is located in the River Oaks neighborhood in Houston.

Class of 2007 Wojciech Kic founded, and is the president of MANAGErenthouses.com, a management company with exclusive focus on managing rent houses. MANAGErenthouses.com manages a portfolio of over 750 rent houses for nearly 500 individual customers with a cumulative value of $150,000,000. This year Wojciech opened its first branch office in Fort Worth to service the greater DFW market.

Peter Mathey co-founded and is CEO of Distributed Power Partners, an international distributed power development company with extensive experience in renewable energy and large international infrastructure development. He’s leading the commitment to build, own and operate distributed solar power projects globally, and the company is currently working in the Chilean solar market with over 200 MW under development.

Yulia Shuvalova left the U.S. in 2013 and now lives permanently in Munich, Germany. If you come to visit Munich for Octoberfest or otherwise, she would be glad to catch up!

Class of 2008 Dynamic Air Shelters has opened a new sales office in Houston, bringing Aaron Knape (‘08), president, home to Houston from Calgary. Juliana Herman (‘09), marketing director, joins Aaron in the new space located east of downtown.

Dynamic Air Shelters is the number one manufacturer of safety-compliant, air-inflated, blast-resistant shelters for the Oil and Gas industry. Independent testing in many live field explosions has proven that Dynamic Air Shelters’ design keeps personnel safer.

The Houston office is an essential step in Dynamic’s global expansion plans.

Class of 2009 Jennifer Hooker Gravenor and Josh Gravenor welcomed their first son, Benjamin, on January 11, 2017.

Karina Larsen Evers and Juliana Herman have been voted in as president and vice president of the NAWMBA Houston Professional Chapter. Stepping down as president is Heather Olin Wright. Karina and Juliana plan to increase membership and gain more visibility for the organization in Houston. Make sure to visit the new website at nawmbahouston.org.

Matt Evers (Weiss ‘11) and Karina Larsen (MBA ‘09) were married on June 15, 2016. They were surrounded by close family and had a wonderful day. Matt is currently working in La Porte and Karina is with Arundo, which offices in downtown Houston. Currently, they are both in training for the MS150 with the Saint Arnold bike team, where Karina also works as a volunteer.

Pattie Le (neé Chang) is employed as manager at Deloitte Consulting’s Finance Organization. She became a proud parent to her first born son, Makai Le. Pattie has volunteered at Christina Noble Children’s Foundation, which helps to rehabilitate and educate special needs orphans in Ho Chi Minh City, Vietnam.

Bishr Tabbaa married Mariluna Hernandez in September 2016. Their wedding was held in Houston and celebrated with family and friends.

Charlie Tidd and his wife, Jen, are proud to announce the birth of their daughter, Marie Andree, born January 10, 2017, 7 lbs, 13 oz.

Class of 2010 Fortuna Resources ends 2016 with a bang. Founded in January 2016, by CEO Aaron Davis and funded

by Och Ziff Capital Man-

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agement Group in April 2016, the company quickly executed on its plan of leasing acreage in the Delaware Basin and making acquisitions. Fortuna grass roots leased 4,000 acres in Delaware and made its first acquisition from BHP Billiton in August 2016. In December, Fortuna sold two thirds of their assets to PDC Energy out of Denver for $118 MM. Looking towards 2017, Fortuna hopes to continue its success and continue to expand as a premier oil and gas operator in the Permian Basin.

Michele LaGrone is working in telepsychiatry with patients in San Antonio and Midland. She is also getting her music career started up.

Marcus Owens received one of Texas Southern University’s 2017 Jesse H. Jones Alumni Association 40 Under 40 awards. He is currently a senior consultant with Capgemini.

Bennett Walton, MD practices at Slade & Baker Vision in Houston as a laser vision correction, laser cataract, corneal and micro-invasive glaucoma surgeon. He is Board Certified by the American Board of Ophthalmology and is fellowship trained in corneal, refractive, cataract and anterior segment surgery.

He is a surgeon for clinical

trials for new and emerging laser, implant and optical technologies.

Class of 2011 Patra Brannon-Isaac joins Leadership ISD as the regional director of Harris County. In this role, she will draw on Leadership ISD’s six years of program momentum and experience in Dallas and Tarrant counties to create a similar fellowship program in greater Houston. The fellowship is specifically designed for business and citizen leaders and goes deep on topics which systemically affect our public education system; fellows are then strategically supported through pathways of campus and district advocacy, strategic leadership roles in non-profits, or elected office based on their respective interests. Leadership ISD currently seeks rising leaders in Houston who want to do more to effectively influence systemic change that allows for all Houston area students to receive an excellent education. Applications and nominations are currently open at www.leadershipisd. org with a goal to establish the inaugural Harris County cohort in August 2017. Prior to joining Leadership ISD, Patra served as the general manager of talent acquisition for Houston Independent School District, where

she oversaw recruitment, selection, onboarding and organizational development programming and initiatives for the nation’s 7th largest school district.

April Frazier’s business, April M. Frazier Fotography, was one of the small businesses to be classified as a preferred vendor by the Houston Super Bowl Host Committee. This included a listing in the Super Bowl Host Committee reference guide which contractors used to fulfill their needs for events during that weekend. Her company was able to secure a contract with PepsiCo to photograph their sponsored events during Super Bowl LI weekend which included the Bruno Mars concert. With the help of Charles Williams (’13) of Chaz Williams Photography, they visually highlighted their events while having a little fun doing it! Chadwyck and April welcomed their baby girl, Lily Dane, into the world on September 7, 2016, 8lbs 4oz and 20.5 inches.

She’s the best!

Aaron Webb recently became the technical sales manager for the Primary Lithium Battery division at Southwest Electronic Energy (SWE). SWE is the leading provider of advanced battery solutions for oil and gas applications within upstream drilling 45

and exploration, midstream pipeline and transportation, and downstream monitoring and instrumentation.

Class of 2012 Amelie Fehres, daughter of Hermine Benard and Carl Fehres, was born on October 10, 2016. She’s a sweetheart and her parents are totally smitten.

Jared Field and his wife were blessed to add Elizabeth Anne Field to their family on June 4, 2016.

Jaime and Jennifer Ortegon (neé Neeley) welcomed Juan Carlos Ignacio on December 30, 2016.

Class of 2013 Blake Helfman was married in February 2017 to Hilary Rosenstein.

Turner Hoff and his girlfriend, Ariane Valle, co-founded Vegetable and Butcher, a subscription-based service that delivers chef designed, dietitian approved, thoughtfully prepared meals to health-conscious people.

Think Blue Apron for prepared meals. Vegetable and Butcher is currently servicing two zip codes in Washington, D.C. – 20002 and 20003 – but plans to expand to other areas in the District in early 2017. To learn more about V+B and to stay up-to-date on all the

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latest happenings, visit www.vegetableandbutcher. com.

Sandra Bollich Johanneman and her husband, Ben Johanneman, had a baby boy (James) in October 2016.

Samantha Hobbs Kast and her husband, Patrick Kast, had a baby girl (Elizabeth) in October 2016.

Sanju Patel is recently engaged to Sapna Patel of Dallas and will be getting married later this year!

Davis Rushing and his wife, Katie, welcomed son Abel, who joins brothers Radley (5) and Willie (3).

Abel was born in November and is already sleeping through the night and fighting with his brothers. November was a busy month for the Rushings. In addition to Abel, Davis opened the USCA Shield Fund. The fund is an open-ended mutual fund that employs a covered call strategy that Davis has managed for several years.

He sells call options on individual stocks that meet his criteria of safety, size and dividend growth.

Class of 2014 Alex Forshey’s twin boys, John Henry and Jamison, were born on December 29, 2016.

around the water cooler

||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||| David DeFillipo is product lead for the mobile apps of Surfline, FishTrack and Buoyweather. The company is about to release a turbo rad update to Surfline from their office in Huntington Beach, which David obviously has to test out by surfing as much as possible — in California and Hawaii.

Emmett Walsh and Lisa Gonzalez married in February.

After 15 years of work experience in the Texas Medical Center, Emmanuelle Schuler, PhD, EMBA, has launched her consultancy, Corallis Consulting.

She now provides strategic management services to biotech and life science companies, research institutions and hospitals. She also mentors entrepreneurs in the Houston innovation ecosystem.

Kira Gustafson married Tyler White on September 4, 2016 in Montgomery, Texas. Both Kira and Tyler were members of the MBA-P Class of 2014 and were, in fact, members of the same small group for their very first and very last team.

Class of 2015 Gabrielle Matringe (neĂŠ Landreneu) and her husband welcomed their baby boy, Henry, into the world on November 18, 2016.

Douglas Wells was recently named the director of engineering services for California State University Northridge, one of the flagship schools of the California State University System. He continues his career in academia, having served as the director, Central Plant, and the director of facilities and maintenance services for Rice University over a period of 16 years. The California State University System is composed of 23 campuses enrolling more than 460,000 students with approximately 24,500 faculty and 23,000 staff and is the largest four-year public university system in the U.S.

Class of 2016 Yilmaz Bingol had her second child, a baby girl, Adel Bingol, on January 18. She also changed jobs.

Yilmaz is now a part of the business development group at Jacobs, serving as inside sales manager.

Class of 2018 Ji Shen, an EMBA student, was promoted to global chief engineer at Bechtel.

In Memoriam Benjamin Bailar, a former dean of the business school, died Feb. 20 in Lake Forest, Illinois. He was 82.

A former postmaster general of the United States (1975-1978), Ben came to Rice University in 1987 as the result of a search chaired by Neal Lane, who was provost at the time.

From 1987 to 1997, he served two terms as dean of what was then called the Jesse H. Jones Graduate School of Administration. Ben was the third dean of the school and the first to be appointed the Joe Nelson III Professor of Administration. After a sabbatical leave during academic year 1997-98, he retired in 1998.

A native of Champaign, Illinois, Ben was the son of a distinguished professor of chemistry at the University of Illinois. He received a B.A. in geology from the University of Colorado and an MBA from the Harvard Graduate School of Business Administration. His undergraduate and graduate degrees were later complemented by two honorary doctorates: a Doctor of Public Administration from Monmouth College and a Doctor of Humane Letters from the University of Colorado at Boulder.

Ben is survived by two children, Christina and Ben Jr.

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Richard Trask, former director of admissions at the business school, of Independence, Missouri. died in September of 2016 after a several year struggle with Lewy Body dementia. He was 83.

Dick graduated from Honesdale High School (Pennsylvania) and continued his education at Long Island Technical & Agricultural College, Utah State University and University of Houston Clear Lake. As a USN veteran, he served on a radar picket ship.

Dick started his career with GE in Syracuse and in Houston and was involved in the engineering aspects of ground to spacecraft transmission. When the program closed, he stayed in Houston and became the director of admissions to the UH Clear Lake Graduate School of Business. Dick finished his career at Rice, retiring in 1998.

A committed runner of 31 marathons, Dick enjoyed running with friends in the hot, humid Houston summers where he resided for 47 years. He also hiked the Colorado mountains and to the bottom of the Grand Canyon.

Dick is survived by his wife of 59 years, Ann Schafle; children Karen and Bruce; one grandchild and three great grandchildren.

peter’s page NEWS AND NOTES FROM THE DEAN

“I remember how

good it felt to be on the cusp of a few graduations and knowing, deep in my bones, that the next few years were going to be exciting and wonderful.”

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Article in Local Houston magazine, February 2017

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PERMIT #7549 HOUSTON, TEXAS

P.O. Box 2932 Houston, TX 77252-2932

Executive Education NEW COURSE: Leader as Coach Instructor: Brent Smith, Ph.D. Upcoming Dates: June 26-27, 2017 Focus on the tools and techniques that allow you to coach and develop your staff for better effectiveness, address individual performance problems and career derailers, and prepare high potential employees for roles of much greater responsibility. Learn more: business.rice.edu/exed#coach

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