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January 11, 2007

One on One: John Camillus

“The essence of a professional school is the ability to merge disciplines,” said John C. Camillus of the Katz Graduate School of Business. “The area I’m involved in — strategy — is really bringing blue and yellow together to make green.”

Camillus, who joined the Pitt faculty in 1977, has held the Donald R. Beall Endowed Chair in Strategic Management since 1991. He also served as associate dean of the Katz school from 1982 to 1990.

Among his honors and awards at Pitt, Camillus won the Chancellor’s Distinguished Teaching Award in 1988 and the Chancellor’s Distinguished Public Service Award in 2006; the Distinguished Professor Award for Teaching Excellence from the executive MBA classes of 1986, 1996 and 2006; the Distinguished Professor Award from the FLEX MBA class of 1998; an award for teaching excellence in MBA programs in 2002, and a Distinguished Professor Award for Teaching Excellence in the Executive MBA Program in 2004.

Camillus also has been honored for outstanding community service to more than 20 cultural and public service organizations in the region, including the Andy Warhol Museum, Carnegie Science Center, the Pittsburgh Symphony, the Riverlife Task Force and Gateway Rehabilitation Center. In 2006, Camillus received a Glade Run Lutheran Services award for “generosity in volunteering his time and expertise.”

In addition to teaching in Katz’s MBA and doctoral programs, Camillus has been involved in designing and offering executive education programs for managers in the United States, Europe and Asia.

Prior to joining Pitt, he was professor of management at the Indian Institute of Management, Ahmedabad, the premier management school in India.

He earned a Doctor of Business Administration at Harvard.

Last month, Camillus discussed his career as well as his teaching and business philosophies with University Times staff writer Peter Hart.

UNIVERSITY TIMES: Your background as an award-winning teacher, researcher, consultant and as someone who performs community service suggests a range of different kinds of skills. How do those skills interrelate?

CAMILLUS: It’s important to have a diverse background and diverse interests. Ideally, you need a Renaissance person at the graduate level in a professional school, or you might fall into the trap of being constrained by your discipline.

I deal a lot with executives, and the analogy I have there is that executives have learned to ride a motorcycle intuitively. You turn the handlebar in the direction you want to go and you use body English. But when somebody tells you about counter-steering, it’s like magic, it’s totally counter-intuitive. You press down on the left handlebar and the bike goes left; you think it would go right, but it goes left; press on the right handlebar, it goes right. You don’t believe it until you do it.

The point is, you’ve got to have the ability to practice theory, because it’s sometimes counter-intuitive. If you just look at the theory, it looks complex and you don’t really understand what you’re doing.

You can be the greatest finance theorist, but to be a practicing manager you’ve got to understand how finance impacts marketing, impacts manufacturing, impacts human resources — putting all of them together needs a broad perspective. The fact that I’m out there in the real world and also have some professional training enables me to teach at the graduate level.

UT: Do your diverse audiences — students, working executives, those in the not-for-profit and for-profit sectors — share a common language?

Accounting, mathematics and economics are the languages of business, but then you’ve got to understand the origins of the languages too, because people can use the same term and mean totally different things.

I was working with a company on scenario-building and I discovered, by accident, they were not really communicating with each other. I asked them, “When you’re talking about technology what are you talking about?” One said, “manufacturing,” others were talking about IT. It meant extraordinarily different things.

In strategy we use the language of economics, but the particular economics that we focus on — industrial organization — was developed from a government policy standpoint, so while the government is trying to create a level playing field, we’re trying to create a playing field that is extremely biased in our favor. These are 180 degrees apart.

You see different things depending on if you’re looking at it from a governmental perspective or if you’re looking at it from a profit perspective.

UT: When you talk about strategy, do you mean motivating an individual or working in a team framework?

It has to be teamwork, and that makes it infinitely more complex. It makes it a “wicked problem,” that is, a classic problem where the problem is not well-defined and where each attempt to create a solution changes the problem.

In the old notion you can define a problem and then solve it. What happens if you haven’t defined or can’t define the problem?

And it’s especially complex and wicked when you necessarily have to bring in teams of players, sometimes teams from outside your business, because they bring different priorities, different values, different perspectives on the world. It’s the old story of six blind men and the elephant, where each touches a different part of the elephant and describes the elephant as a different thing.

The beauty of this, though, is that if you’re willing to live through the difficulty of working with a team and the complexity and the paradoxes, teams bring different contexts and eventually learn from each other.

In terms of teaching, this means creating a context where diverse people can interact with each other, understanding that there are different values, different languages, and so forth.

I just came back from teaching our executive MBA students from across the world in Brazil, where we had East European managers, British, American, Brazilian managers, and it’s very easy for them to end up disliking each other. Just getting to the class on time, that norm doesn’t hold across the board.

In our program they spend a week in São Paulo then a week in Prague, then a month in Pittsburgh. In Brazil they dislike each other. In the Czech Republic they begin to understand that the basis for the dislike is not solid. By the time they come to Pittsburgh, they understand how valuable the different perspectives are and they appreciate the diversity and learn how to utilize that diversity.

UT: How does your consulting work inform your teaching?

At the graduate level in business, I learn a lot from not-for-profit organizations, so I can take stuff from there and apply it in complex contexts at for-profit organizations when I consult. Not-for-profit organizations are much more willing laboratories and much more willing to change.

For example, you take the Warhol Museum. [Director] Tom Sokolowski intuitively was applying a mode of planning that for-profit businesses are very reluctant to apply, because they’re so driven by the past that their strategic plans are really incremental tweaks of what they’ve been doing in past plans. But what Tom was saying was visionary: “What is it I want to create in the Warhol?” And you work back from the vision to the plan while businesses work from the past forward.

So that’s why I feel my community service melds directly into my teaching in the classroom. I use case studies that are based on real-world experiences, like the Warhol project.

UT: How has your own education fit into your multi-faceted career?

In order to figure out what was happening in business and in academia, I learned that going back into the 1920s and 1930s and even back to the 19th century helped. If you haven’t gone back 50 years you don’t realize that things you take for granted are really inventions and not something passed down from Mt. Sinai.

For example, the use of ROI (return on investment). The practice is so widespread that 80 percent of American businesses use it as the standard measure, and yet this is an obscene measure, it’s extraordinarily dysfunctional.

ROI is an efficiency measure, so you can manipulate it to look good, you can say I have a 90 percent return on investment, but you can do that by manipulating the investment and not the income. ROI is an accounting measure and not really an economic measure, so it produces historical accounting numbers which are readily manipulatable, that do not map onto economic theory and do not necessarily relate to what the future looks like.

I’ve done some benchmarking of corporations across the world, 22 target companies, in the U.S., China, Europe and India. We discovered that the best companies are moving to quality analysis, that the number-pushing is secondary. The analysis says, “Tell me a story of why you think you’re going to be successful in India or China or the U.S. Tell me the story, then we’ll look at the numbers.”

UT: So if a business is stuck with the foundation of ROI, in a way there has to be some un-learning?

Yes. There’s got to be some un-learning. You need to know the history of how some measures have been developed. What people take for granted like EVA (economic value added), the history shows that it’s just one stage in an evolution process that might work in certain contexts, but not in others.

UT: Do you think about what the next wave of business standards will look like?

I got into a whole stream of research because of one question a student asked me in 1972. It’s true. I was fulminating in the classroom about how most control is historically based: You view past performance and try to remedy it. And I was fulminating about how much better conceptually it was to think about what the future is going to be and trying to manage that.

And a student said: “Tell me how to do that.” Which is right to the point and actually hooks up with the Warhol story. It’s a culmination of 20 years of thinking about this: Ultimately, you need a vision.

UT: What was the Warhol vision?

I was part of the ignorant masses: I’d not had classes in art. I have an engineering background, so we did engineering drawing and so on, and I saw Warhol as a technician, who essentially was manipulating those silk screens. Basically, I thought it was crap. It looked to me like he was a very clever marketer, with not much capability or artistry.

But you talk to Tom Sokolowski and you begin to understand how Warhol related to his time, helped people understand the context of his time, raised questions and awareness and did everything that an artist should. And since I was just looking at the technical aspect of it, I didn’t understand the significance of Warhol.

I’m going to a museum and I see all these artifacts. I see not necessarily a source of stored knowledge, but a dusty repository of the past. Tom understood that the Warhol is not a repository or a shrine to Warhol, it’s something that is alive, that interacts with the community, that makes the community look at itself and say this is who we are, this is who we want to be. So it’s really a crucible of culture, a reflection of what’s going on, and it’s also a stimulus for picking up what we are and what we want to be.

It’s the same thing in companies. If you look at it as a technician or only as discipline-oriented, you don’t see the dream.

UT: How can you bring this to the classroom?

Well, I say, what are the techniques one can use here? What are the components of a vision? How does one articulate a vision? How do I articulate the fundamental choices that my values drive me to? This is the counter-steering I was talking about. What are the aspirations? What are the values? What are the competencies?

For example, the ability to ask the “beautiful question” is a competency. Or the ability to react to something and intuitively say “That’s not genuine,” and not knowing why, and later to learn why.

Tom was saying: “It’s possible to get an enormous increase in our funding, or our funding will stagnate. It’s possible to think of a world in which Warhol becomes even more significant, or a world in which he is seen as passé.”

Well, his paintings are selling for $18 million or $20 million now, and Tom did get major funding with the Heinz Endowments. But he didn’t know five years ago what would happen. But he saw there were four possible worlds, instead of just saying, “Oh, God, the world can be anything.”

There are a bunch of things that are common to all four worlds. I’m helping him by bringing these management techniques for surfacing what can happen and for asking, “What can I do to create the vision?” so in a sense I’m bringing these techniques from business and then later seeing how he’s using them and taking that back to the classroom as a case study.

This is why it’s fun in the classroom: People are excited when you talk about values that you may think are not relevant to business but ultimately are the fundamental anchor on which profits are built.

You take [British-based retailer] Marks and Spencer, you take Starbucks, you take Wal-Mart, all of them have fundamental values which have undergirded their business success.

In fact, Marks and Spencer became the biggest and most successful retailing firm in the world based on two values that the chairman expressed: the importance of simplicity and the importance of taking care of three groups of people: the employees, the suppliers and the customers.

Another example is Wal-Mart. Wal-Mart is getting into India and the partner is the leading cell phone company. If you’re a discipline technician you’ll say, “What the hell does a cell phone company have to do with Wal-Mart?”

But if you’re a little bit more of a Renaissance person, you’ll say, “You know, that’s the largest cell phone company in India and they distribute all over and one of the key notions in business success is distribution.” Secondly, they understand the various segments of the market in India, which is huge but extraordinarily diverse.

Wal-Mart has had problems going international because they don’t understand these different markets, the packaging, the branding, how you sell, how you get the stuff there, these are all different; the cell phone guys know that.

And how do you deal with government? So, the cell phone company is bringing an understanding of government, an understanding of marketing, an understanding of distribution and a hell of a lot of cash.

What they’re getting is the logistics capability of Wal-Mart, the sourcing capability of Wal-Mart, the whole notion of how to manage that kind of business. There’s enormous technology to large-scale retailing. So Wal-Mart is bringing not necessarily a product, but capabilities.

If you look at Federal Express you’d say what makes them successful is that they can do something that most others cannot, which is deal with corporate customers and deal with individuals, which is rare.

All of these examples really come down to your values. Your values actually surface when you have to make choices; you may not even know what they are until you have a choice.

If you say, like the Pittsburgh Symphony did, “I’m a regional symphony orchestra and I want to be a world-class symphony” — that’s a fundamental value. The whole structure, the whole character of an organization follows from that choice.

If I want to be world class, what does that mean? Am I only performing music or am I an arts organization? Do I want to bring in Chinese acrobats? Who is my audience? What is the funding source? If I’m going global it costs me a whole lot more money than whatever I get from ticket sales or from sponsoring organizations. So I have to get money from the NEA (National Endowment for the Arts), corporations and foundations.

If I go to the NEA and say “I’m playing the dead Germans and Austrians,” they’ll say, “How nice, now go away.” If I say, “I’m doing new American composers, or I’m commissioning new work” and so on, you could get $1 million out of them.

You can’t be seen as world class if you only play in Pittsburgh. So you’ve got to play in Vienna and Berlin and London and places like that. And to do that you need money.

If you’re local, you have the blue-haired ladies and traditional music, which means you can’t go to the NEA, and if you want to play Heinz Hall, to supplement tickets you bring in the Chinese acrobats.

It’s all driven by “Who are we? What do we want to be?” Not ROI.

I can do this kind of analysis with corporations, too. If you know the fundamental choices, everything else follows. It’s a touchstone or a template and it’s stable. What the product is could change, who our market is could change, our strategies change, but the template is stable.

Doing this with the symphony really expands the knowledge you find in the textbooks. To be a good teacher in a good professional school you have to go beyond just the technicalities. You can make an extraordinarily successful reputation as an academic on the research end by being focused on the technical, but if you’re into consulting, or if you want to change things, then taking the best theory and understanding practice and putting them together — that is something else again. Which is why I like teaching in the executive MBA program because these are the guys who are out there practicing. And all I have to do, really, is to share some frameworks and ask the right questions.

You suddenly realize it’s common sense. I could bring in a lot of complex notions about how the brain works, and a lot of jargon and economics and all kinds of other stuff. The advantage I have because of my academic background is I know the checklist of how the brain works. The challenge is really to take this very complex strategy framework, forget the jargon, and say, it’s really just having a conversation.

“What might we do? What are we good at? What can we do? What ought we to do — in terms of our obligations to suppliers, to the community, to stakeholders, to government, to customers? And what do we want to do? What are the priorities of top management?”

So we have a conversation about those few questions and you have strategy. I can plug these questions in as we go along.

It’s very similar in the classroom, but to have those conversations, you need to create a context where people are comfortable and are willing to express a point of view. So it’s ultimately respect: the willingness to accept that students, even undergraduates, have insights.

And the second thing is eliminating any unnecessary uncertainty. Make it very clear; set the ground rules and then go forward. In that sense creativity requires a strong and clear foundation.

When I taught in India at a very elite school I could assume they knew the technical aspects, what could be found in a textbook.

When I came here I couldn’t do that.

For example, I was teaching a night class in the College of General Studies. It was an incredibly valuable experience because it made me step back and think about teaching. I can’t do what I did at this elite school. It won’t work here, because this is one of several disciplines the students are studying, and these are students who have already spent the whole day at work, and it’s a challenge for them even physically to come to a class at the end of a long day. I got a sense of respecting them. I had a sense of obligation to them because I knew what they were facing and how they were making sacrifices.

UT: You’ve taught a wide range of courses. Do you think there is an ideal class size?

I like classes around 30 or 35. When you go to 75 I don’t have the ability to get to know every student by the time the term is done. That’s important to me. I’m having a conversation, which is a building conversation, so I’ve got to have the ability to say, “Jane said this three days ago, how does it apply now?”

The pedagogical method I prefer is the case method, which in a professional school makes a lot of sense.

UT: Do you employ group assignments?

Yes, I prefer group assignments. And this goes back to my experience as a consultant and my own schooling.

In my own case, I was really a stupid person. With a group assignment I would just say to my group, “Leave me alone and I promise you’ll get an A.” I found it much easier to just do the project on my own. Which means I missed the lesson.

When I came to do my consulting, I realized how important it is to work with a team, particularly when the team disagrees with you. Most significant activities in companies are performed in teams, so it’s very important that students experience that.

I love having international students in my classes. I try to mix them in with the American students when I make up the teams. For a group assignment, the natural tendency is for the presenter to be an American, because they know the language. But it’s really more important, and I say, “Don’t worry about the grade,” for the persons who are not comfortable to do the presentation. There’s a real world out there, and you’ve got to learn to do this. It’s emotionally difficult for them, but it’s the least costly way for them to learn.

UT: Looking 10 or 20 years ahead, what does your crystal ball tell you?

My own vision goes back to your first question. It’s melding everything. If you think about the most powerful organizations in the world, there are few countries that are extraordinarily powerful, maybe 10 or 20. There are maybe 100 companies that are extraordinarily powerful, Microsoft, GE.

The third most powerful set of organizations in the world are comprehensive American research universities, such as our own.

The guys who became rich in the old days were the meanest sons-of-bitches who used pure physical power to break people’s heads. That power begat wealth which begat more power.

Today, it is shifting. Now power is knowledge. Where is knowledge? It’s in the universities.

Then you add innovation, which is the driver of all growth, success and profits and gains in society. Innovations generate from what people call ecosystems.

An ecosystem is a combination of a geographically proximate set of large companies, small companies, venture capital, universities, research organizations and enlightened governmental policies. For example, you have San Jose, that’s an IT ecosystem; Boston in an ecosystem in pharmaceuticals. It’s got Mass General, the big pharmaceutical companies, start-ups, venture capital, favorable government policies. That’s where innovation takes place. What is happening in our shrinking world is that ecosystems need to be linked to each other. The point is how can ecosystems that are not proximate best link up? The best entity to do that is a university.

To use a trivial example, our undergraduate students can spend time in India, do a market research project there as part of their learning, and bring it back here to feed venture capital or start-ups.

If we go there, if my colleagues at the various schools go there, we can do that; we can develop new curricula.

What I see is the need to add to knowledge and understanding and innovations that promote the growth and development of the University, our students and the local economy of which we are such an important part. My vision focuses on an interdisciplinary — business, engineering, law, SIS, GSPIA, GSPH, UCIS, Arts and Sciences — approach to preparing our students for the jobs of the future and helping Pittsburgh.

The fascinating thing is that to be a good professional school you really need an incredibly strong liberal arts foundation.

Filed under: Feature,Volume 39 Issue 9

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