Haas NewsWire


Haas NewsWire, October 4, 2004



UNIDO Director-General to Speak on New Directions for the United Nations, Nov. 1


UNIDO Director-General Carlos Magariños

UNIDO Director-General Carlos Magariños


United Nations Industrial Development Organization (UNIDO) Director-General Carlos Magariños will speak on "New Directions for the UN" at a special Management of Technology lecture at the Haas School on Monday, November 1, at 4:00 p.m. in the Wells Fargo Room.


This visit is part of the continuing and growing collaboration between UNIDO and the MOT Program at UC Berkeley.


"It is an honor to be visited by such a senior official of the United Nations system" says Andrew Isaacs, adjunct professor and executive director of the MOT program. "Our relationship with UNIDO reflects the growing importance of technology in the advancement of the developing world, a relationship we are quite proud of."


Magariños has been Director-General of UNIDO since December 1997, when he was elected for a four-year term by an overwhelming majority of the organization's member states, making him the first Argentine, as well as the youngest person, to head a United Nations specialized agency. In December 2001, he was re-elected as Director-General for a further period of four years.


UNIDO is responsible for reducing poverty through sustainable industrialization in developing countries and the economies in transition. During his first term of office, the director-general implemented an aggressive reform program that has received worldwide recognition and is now working to ensure and maintain excellent standards in the delivery of UNIDO's services in his second term.


Previously, Magariños served as Argentina's State Secretary for Industry and Mining(1993-1996); National Director for Foreign Trade (1991-1992); Under-Secretary of State for Industry (1992-1993); and Economic and Trade Representative of the Argentine Government in Washington, DC (1996-1997).


The MOT/UNIDO collaboration includes an annual conference, "Bridging the Divide," and the MOT/UN Fellows Program.  The second annual "Bridging the Divide" conference will take place April 21 - 22, 2005.  The MOT program is a joint effort between Haas, the College of Engineering, and the School of Information Management and Systems.


Seats for the talk will be available on a first-come, first-served basis. No RSVP required.



Investors Mistakenly Rely on Firm's Press Releases, not SEC Fillings, According to Research


Investors who rely on a firm's press releases when making investments, but fail to take that firm's official SEC filings into consideration, are not doing themselves any favors according to research by Shai Levi, a new assistant professor at the Haas School of Business.


Levi, who joined the Haas Accounting Group this fall, has found that investors often fixate on the limited financial information firms voluntarily disclose in their end-of-quarter press releases. Most investors then don't adequately revise their view of a firm's performance when the full set of financial reports is filed with the SEC a few weeks later.


"While they might have made a good decision based on the information available at the time, investors need to update their expectations of firms' performance once more information is available," Levi says.


Levi explains that firms often provide earnings numbers in press releases, but wait to disclose cash flows in the mandatory SEC filings. As a result, many investors judge a firm based on earnings performance without properly taking cash flow information into account upon its disclosure. This bias leads investors to misprice stocks because, for example, cash flows that are low when earnings are high can be a signal of aggressive accounting practices or a firm's financial instability.


In his research, Levi has found that trading strategies based on the difference between announced earnings and actual cash flows beat the market by as much as 14 percent a year in 2001 and 2002 for firms that disclosed only earnings in their press releases. In contrast, for firms that included cash flows in press releases, the data was properly considered by investors and fully impounded in stock prices.


According to Levi, such findings indicate that regulations designed to provide investors with the best information should focus not just on mandatory documents, but also on voluntary documents such as press releases. Said Levi, "The SEC's recent Regulation G, which regulates some disclosures in press releases, may be a step in the right direction."


Levi holds a Ph.D. in business administration from New York University, and a law degree (LLB) and BA in economics from Tel Aviv University. He has worked as attorney in a leading Israeli law firm in corporate and securities law, and as an economist devising Israeli regulatory policy on mergers and acquisitions.



Institute for Management, Innovation, & Organization Creates Center for Open Innovation


The Haas School is now home to the Center for Open Innovation (COI), a newly named center that is part of the Institute for Management, Innovation, and Organization (IMIO).


Formerly known as the Center for Technology Strategy and Management, the COI will conduct scholarly research on more open, distributed models for organizing and managing technology and innovation. Henry Chesbrough, Ph.D. 97, will serve as the first executive director of the center.


 "Industrial innovation is in the process of significant change," said David J. Teece, director of IMIO and the Mitsubishi Bank Professor of International Business and Finance.  "In the future, innovation promises to be less inwardly focused, increasingly distributed, and far more global.  The concept of open innovation nicely articulates this shift, and promises to inform research and practice on innovation management for many years to come."


To date, the COI has raised research funds from foundation, industry, and government sources.  Its funds have been used to support research by faculty members as well as MBA and Ph.D. students. Funding has come from the Alfred P. Sloan Foundation, IBM, Dell, Inc., and Japan's Ministry of Economy, Trade and Industry (METI).


For more information on the center and its activities, contact Henry Chesbrough at chesbrou@haas.berkeley.edu.



Undergraduate Case Competition Finalists to Analyze Major Tech Merger, Oct. 7


Finalists in the seventh annual Investment Banking Case Competition will analyze one of the year's largest technology M&A transactions -- Juniper's acquisition of NetScreen --  at the final round of the competition on Thursday, October 7, from 6:00 p.m. to 9:30 p.m. in the Arthur Andersen Auditorium.


The competition, co-hosted by Goldman Sachs & Co. and the Haas Undergraduate Program, is open to the public.


This year's finalist teams, selected from an initial field of some 150 students, will be announced by 5:00 p.m. on Monday, October 4.


The final teams will each make a 20-minute presentation followed by questions from a panel of judges. Goldman Sachs judges include vice president Sam Britton and associate Lev Finkelstein. Representing Haas on the panel will be Stephen Etter, BS 83, MBA 89, lecturer with the Finance Group and Dan Himelstein, BS 83, executive director of the Undergraduate Program. The winning team will be announced after a short recess, followed by judging panel critiques and audience questions.


Each competing team applied its knowledge and skills to the acquisition of NetScreen, a high profile Goldman Sachs transaction from February 2004. Finkelstein calls the acquisition "a landmark transaction in the communications technology industry," and notes that the case gives students practice in both the strategic and financial analysis required of an investment banker advising on such a transaction.


"Competing gives students an accelerated development opportunity and chance to enhance their skills," agrees Erika Walker, director of undergraduate admissions and operations. "It also affords them a wonderful opportunity to meet and to get to know members of the Goldman Sachs recruiting team." She also notes that Goldman Sachs interview slots will likely be allocated to the final round participants and that those participants will also be eligible for the spring 2005 Haas external case competition team.


Each team will present its conclusions through a written product, similar to the discussion materials often used in investment banking, consulting, and corporate board meetings. For more information on the investment case competition, visit http://www.haas.berkeley.edu/Undergrad/studentservicescasecompinternal.html.



Still Time to Get Tickets for Sangam Conference on Oct. 10


Tickets are still available for the third annual Sangam conference, Sunday, October 10, at UC Berkeley's International House. Following on the heels of last year's sold-out event, Sangam 2004 focuses on the global business impact of South Asia's changing economic environment.


The keynote speaker at the conference will be Krish Ramakrishnan, CEO of Topspin Communications. Ramakrishnan will discuss how Topspin has gone about setting up a development center in South Asia. In his speech, he will cover issues from how a startup competes for talent with the likes of Microsoft and the cultural impact on a company with core innovation happening in two locations.


Two new speakers have joined the conference panels on leadership and innovation: Neal Bhadkamkar, managing director of Monitor Ventures; and Vinod Aggarwal, political science professor and affiliated professor of Business and Public Policy at Haas. The conference, titled "Succeeding in a Global Economy," is sponsored by the Clausen Center for International Business and Policy, and presented by Berkeley MBA students in the Haas School's South Asia Club.


A portion of the proceeds from Sangam 2004 will benefit Amar Seva Sangam (ASSA), an organization dedicated to empowering the disabled in India, and American India Fund (AIF), devoted to accelerating social and economic change in India. Sangam 2004 takes place from 10:00 a.m. to 4:00 p.m. on Sunday, October 10, in the Chevron Auditorium at UC Berkeley International House. For more information and to register online, visit http://www.sangam2004.org.



CMR Award Winners to Lecture on Oct. 14


Jennifer Chatman, the Paul J. Cortese Distinguished Professor of Management at the Haas School, and Anita L. Tucker an assistant professor at the Wharton School of Business, will each give lectures based on their award-winning articles in the California Management Review (CMR) on Thursday, October 14, at 4:00 p.m. in the Wells Fargo Room.


The 2004 Accenture Award from CMR was given to Chatman and her co-author Sandra Eunyoung Cha, a doctoral student at Harvard, for "Leading by Leveraging Culture." Anita L. Tucker and her co-author Amy C. Edmondson, an associate professor at Harvard Business School, received the award for "Why Hospitals Don't Learn from Failures: Organizational and Psychological Dynamics that Inhibit System Change."


This event is open to the public and will take place in the Wells Fargo Room. The presentation will be followed by a wine and hors d'oeuvres reception. For more information, contact Gundars Strads at strads@haas.berkeley.edu.



Haas Faculty, Students, Staff, and Alumni Invited to Celebrate Homecoming, Oct. 16


The entire Haas community is invited to take part in the Haas School Homecoming Celebration on Saturday, October 16, before the Cal Bears take on the UCLA Bruins at 2:00 p.m. in Memorial Stadium.


The day starts with Dean Tom Campbell's current economic and political assessment from 10:30 a.m. to 11:30 a.m. in the Wells Fargo Room. His talk is one of a number of seminars scheduled around campus in which distinguished UC Berkeley faculty will share their expertise with homecoming visitors.


This year's Haas alumni luncheon features a Mexican fiesta with a buffet, beverages, and live Mariachi music in the courtyard. A special area will be reserved for reunion classes (those ending in 4s and 9s) to catch up with fellow classmates.


In addition, Haas has a reserved block of seats in the general admission "Blue Zone" section at the south end of the stadium for this showdown between Cal and UCLA. October 8 is the deadline to purchase Haas football tickets and to register for the Haas Alumni Luncheon.


For more information on Haas homecoming events, call 510-642-7790. Information and online registration for the luncheon and football game (required) are also available at http://www.haas.berkeley.edu/alumni/homecoming/.



Faculty News


Prof. David Vogel's New Book Examines Globalization's Effect on Regulation


The University of California Press has just published a book of essays on globalization and regulation edited by David Vogel, the Solomon Lee Professor of Business Ethics, and Robert Kagan, professor of law, titled Dynamics of Regulatory Change: How Globalization Affects National Regulatory Policies.


This book extends the argument of Vogel's book Trading Up, which discussed environmental standards, by focusing on the impact of globalization on labor rights, women's rights and capital market regulations. Contrary to the arguments of critics of globalization, the essays Dynamics of Regulatory Change argue that under certain circumstances global economic integration can actually lead to the strengthening of consumer and environmental standards.


For more information on this book, visit http://www.ucpress.edu/books/pages/10468.html.



Haas in the News


Kellie McElhaney, adjunct assistant professor and executive director of the Center for Responsible Business, was quoted in a September 29 Contra Costa Times article titled "Chevron Touts Social Responsibility." McElhaney commented on Chevron's decision to issue an abbreviated corporate social responsibility report. For full text: http://www.contracostatimes.com/mld/cctimes/business/9787995.htm?template=contentModules/printstory.jsp


Russ Holdstein, lecturer on entrepreneurship, commented on the Bush administration's portrayal of John Kerry's tax proposals in a September 29 Los Angeles Times article titled "Are Bush's Tax Cuts Doing the Job?" Holdstein commented on tax rates and job creation. For full text: http://www.latimes.com/news/nationworld/nation/la-na-taxes29sep29,1,7036926,print.story


Pablo Spiller, the Jeffrey A. Jacobs Distinguished Professor Business and Technology, commented on the rise of oil prices in a September 28 San Francisco Chronicle article titled "Storms, Sabotage Slam Oil Futures." For full text: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2004/09/28/BUG6R8VS4J1.DTL


Dwight Jaffee, the Willis Booth Professor of Banking, Finance, and Real Estate was quoted in the Wall Street Journal on September 27 in an article titled "Moving the Market - Tracking the Numbers." Jaffee commented on short sellers of Fannie Mae stock.


Henry Chesbrough, executive director of the Center for Open Innovation, authored an article on the need for innovation in the service sector. The article ran in the Financial Times on September 24 titled "A Failing Grade for the Innovation Academy." Chesbrough's thoughts on open innovation were also mentioned in a corresponding article titled "More than the Sum of its Parts."


Hal Varian, professor in the Operations and Information Technology Management Group, authored an article about a study on stock message boards. The article ran on September 23 in the New York Times titled "Good Stock Advice or Online Noise?" For full text: http://www.nytimes.com/2004/09/23/business/23scene.html?pagewanted=print&position= (registration required).  The same article also appeared in Tech News World on September 25 titled "Internet Stock Talk may Have Statistical Meaning." For full text:  http://www.technewsworld.com/story/Internet-Stock-Talk-May-Have-Statistical-Meaning-36904.html


On September 23, Jerry Engel, executive director of the Lester Center for Entrepreneurship & Innovation, was quoted in the San Francisco Chronicle in an article titled "In the Lap of Luxury." Engle commented on entrepreneurs having a practical connection with their products-in a story about a single man who developed a breastfeeding pillow. For full text: http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2004/09/23/BUGSH8T2GD1.DTL&type=business


Janet Yellen, Eugene E. and Catherine M. Trefethen Professor of Business Administration and currently on leave as CEO of the San Francisco Federal Reserve Bank, was quoted in Dow Jones Business News on September 21 in an article titled "Fed Lifts Key Interest Rate ¼ Point, Sees Balanced Risk."


Kenneth Rosen, the California State Professor of Real Estate and Urban Economics and chair of the Fisher Center for Real Estate and Urban Economics, commented on the role of REITs in investment portfolios in a September 18 International Herald Tribune article titled "How to Trust in Real Estate: Entry Level."


Terrance Odean, associate professor in the Finance Group, was also quoted in the International Herald Tribune. On September 11, Odean commented on investor behavior in an article titled "Quick and Dirty, Maybe, but Due Diligence Pays Paper Chase."



Happening at Haas


SEVENTH ANNUAL INVESTMENT BANKING CASE COMPETITION
Final Presentations
Thursday, October 7
6:00 p.m. to 9:30 p.m.
Arthur Andersen Auditorium
For more information on the investment case competition, visit http://www.haas.berkeley.edu/Undergrad/studentservicescasecompinternal.html.


SANGAM CONFERENCE
"Succeeding in a Global Economy"
Sunday, October 10
10:00 a.m. to 4:00 p.m.
Chevron Auditorium at UC Berkeley's International House
For more information and to register online, visit http://www.sangam2004.org.


MOT LECTURE SERIES
"Global Manufacturing" by Michael Marks, CEO, Flextronics
Wednesday, October 13
4:00 p.m. to 6:00 p.m.
Wells Fargo Room, C420
Having seized the opportunities of global supply chain management and optimized manufacturing, Marks discusses how he grew Flextronics' revenue from $70 million to $12 billion, and previews the road ahead.


CENTER FOR RESPONSIBLE BUSINESS
"Philip Morris Companies to Altria Group: Has Anything Really Changed Beyond the Name?" with David Greenberg, senior vice president and chief compliance officer, Altria Group, Inc. (Altria is the parent company of Philip Morris and Kraft Foods.)
Executive Education Learning Classroom, S480
Wednesday, October 13
5:30 p.m.
For more information, contact Joanna Trammell at joannat@haas.berkeley.edu.


HOMECOMING CELEBRATION
Saturday, October 16, 2004
10:30 a.m. to 2:00 p.m.
Former students of the Haas School will reunite for a festive day back on campus. The annual Haas School homecoming kicks off with a special lecture by Dean Tom Campbell on his insights and perspectives on the current economic and political landscape. This session will be followed by a Mexican fiesta luncheon in the courtyard with live music and special activities for kids. Then it is off to Memorial Stadium to watch the Golden Bears play football against UCLA. Advanced registration required. The registration deadline is October 8.
For more information, call the Haas School Alumni Relations Office at 510-642-7790 or go to http://www.haas.berkeley.edu/alumni/homecoming.


BERKELEY ENTREPRENEURS FORUM


"The Internet-Still the Land of Opportunity"
Thursday, October 21
6:30 p.m. to 8:30 p.m.
Arthur Andersen Auditorium


FIFTEENTH ANNUAL CONFERENCE ON FINANCIAL REPORTING
Friday, November 5
8:30 a.m. to 5:00 p.m.
Hyatt Regency San Francisco Airport Hotel in Burlingame
For a complete program schedule and to register online, visit http://groups.haas.berkeley.edu/accounting/cfrm/conferences/15annual/index.html or call 510-642-6334.


Seminars


BERKELEY REAL ESTATE SEMINAR
Speaker: Barbara Bhukvalova, Haas School of Business
Monday, October 4
12:30 p.m. to 2:00 p.m.
Room C135
For more information, contact Thomas Randle at randle@haas.berkeley.edu.


ORGANIZATIONAL BEHAVIOR AND INDUSTRIAL RELATIONS SEMINAR
Dacher Keltner, University of California, Berkeley
Wednesday, October 6
4:00 p.m. to 5:30 p.m.
Room C220
For more information, contact Deborah Houy at houy@haas.berkeley.edu.


FINANCE SEMINAR
"A Positive Theory of Closed-End Funds as an Investment Vehicle" by Martin Cherkes, Princeton University
Thursday, October 7
4:10 p.m. to 5:40 p.m.
Room C210
For more information, contact June Wong at june@haas.berkeley.edu.


INSTITUTIONAL ANALYSIS WORKSHOP
"Separation of Powers in Practice" by Dean Tom Campbell, Haas School of Business
Thursday, October 7
4:00 p.m. to 6:00 p.m.
Room C325
For more information, contact Anita Stephens at stephens@haas.berkeley.edu.


SHANSBY MARKETING SEMINAR
"Econometric Methods for Program Evaluation" by Guido Imbens, University of California, Berkeley, Economics Department
Friday, October 8
4:00 p.m. to 5:30 p.m.
Room C250
For more information, contact Laura Gardner at lgardner@haas.berkeley.edu.


BERKELEY REAL ESTATE SEMINAR
Yannis Ioannides, Tufts University
Monday, October 11
11:00 a.m. to 12:00 p.m.
Room C135
For more information, contact Thomas Randle at randle@haas.berkeley.edu.


ORGANIZATIONAL BEHAVIOR AND INDUSTRIAL RELATIONS SEMINAR
"It Could Have Been Better: The Effects of Communicating Counterfactual Thoughts on Impression Formation" by Elaine Wong, University of California, Berkeley
Wednesday, October 13
4:00 p.m. to 5:30 p.m.
Room C220
For more information, contact Deborah Houy at houy@haas.berkeley.edu.


FINANCE SEMINAR
"Financial Slack and Tests of the Pecking Order's Financing Hierarchy" by Michael Roberts, Duke University
Thursday, October 14
4:10 p.m. to 5:40 p.m.
Room C210
For more information, contact June Wong at june@haas.berkeley.edu.


INSTITUTIONAL ANALYSIS WORKSHOP
Oliver Williamson, Haas School of Business
Thursday, October 14
4:00 p.m. to 6:00 p.m.
Room C325
For more information, contact Anita Stephens at stephens@haas.berkeley.edu.


SHANSBY MARKETING SEMINAR
"Empirical Tests of Prospect Theory" by George Wu, University of Chicago
Friday, October 15
4:00 p.m. to 5:30 p.m.
Room C250
For more information, contact Laura Gardner at Lgardner@haas.berkeley.edu.


BERKELEY REAL ESTATE SEMINAR
"Has SARS Infected the Property Market? Evidence from Hong Kong" by Grace Wong, Princeton University


Monday, October 25
12:30 p.m. to 2:00 p.m.
Room C135
For more information, contact Thomas Randle at randle@haas.berkeley.edu.


Alumni Events


ALL ALUMNI
Homecoming Celebration
Saturday, October 16, 2004
10:30 a.m. to 2:00 p.m.
Former students of the Haas School will reunite for a festive day back on campus. The annual Haas School homecoming kicks off with a special lecture by Dean Tom Campbell on his insights and perspectives on the current economic and political landscape. This session will be followed by a Mexican fiesta luncheon in the courtyard with live music and special activities for kids. Then it is off to Memorial Stadium to watch the Golden Bears play football against UCLA. Join us for this festive autumn day. Advanced registration required. The registration deadline is October 8.
For more information, call the Haas School Alumni Relations Office at 510-642-7790 or go to http://www.haas.berkeley.edu/alumni/homecoming.


BERKELEY-COLUMBIA EXECUTIVE MBA PROGRAM
Happy Hour in San Francisco
Thursday, October 7
6:30 p.m. to 8:30 p.m.
Gordon Biersch, 2 Harrison St., San Francisco, 415-243-8246
For more information contact Martha Gerhan at magerhan@mindspring.com


BAY AREA ALUMNI
Biotechnology Roundtable: Life Sciences Entrepreneur & Investor Roundtables
Tuesday, October 12
6:00 p.m. to 9:30 p.m.
Stanford Faculty Club, 439 Lagunita Dr., Stanford
For more information, visit http://www.acteva.com/booking.cfm?bevaid=71608


EAST BAY ALUMNI
Speaker event: Executive Associate Athletic Director/Olympic Sports at Berkeley
Thursday, October 14
6:30 p.m. to 8:30 p.m.
Mudd's Restaurant, 10 Boardwalk, San Ramon,  925-837-9387
Two days before the homecoming game, hear Teresa Kuehn discuss the football program, Coach Tedrod, the Memorial Stadium project, and more.
For more information, visit http://www.acteva.com



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