Faculty, School Buoyed by New Hires
As we approach fall quarter 2013, we do so with 117 faculty members, including an excellent selection of mostly junior professors. As we look to fortify our junior and senior faculty ranks in the future, our ability to do this is facilitated by the generosity of our alumni and friends. We appreciate all of your support to keep our faculty strong.
We are extremely pleased to welcome associate professor Frederico Finan, a senior empirical economist. In his most recent paper, Strengthening State Capabilities, he addresses a fundamental question in personnel and labor economics as to whether higher wages attract more qualified job applicants.
His research focused on the Mexican government’s recent effort to hire public employees for a new regional development program. His team randomized across the 106 recruitment sites the initial wage offer to the job applicants. By exploiting the variation in the wage offer, he discovered higher wages attracted significantly more qualified applicants, as measured by various personal traits, including IQ, conscientiousness, and public service motivation. A higher wage also helped recruit individuals to work in more remote locations, or locations more prone to drug violence.
Faculty Publications and New Courses
Our world-class faculty continues to set the standard for research in a range of management disciplines. There is an enormous volume of research underway across every management discipline, yet I can only cover a small slice of the exceptional work our faculty is doing.
Why Bosses Matter
Stanford GSB economists Edward Lazear and Kathryn Shaw teamed up with former Stanford GSB doctoral student Christopher Stanton to publish a working paper titled The Value of Bosses, which explores the impact and value of middle managers in technology-based service jobs. Their research found that frontline supervisors are far more important than previously thought due to their essential role in teaching direct reports the skills and work habits required to be productive employees. The study also found that replacing a poorly performing boss with a top-notch middle manager is roughly equivalent to adding one worker to a nine-member team.
Real World Corporate Governance
Accounting professor David Larcker, a senior faculty member at the Rock Center for Corporate Governance, joined Brian Tayan, a researcher at Stanford GSB’s Center for Leadership Development and Research, to publish A Real Look at Real World Corporate Governance. The book analyzes the most effective corporate governance approaches in deterring accounting scandals, entrenched management, excessive compensation, and poor oversight. Through research and case studies, they find many “best practices” do not have any measureable effect on good corporate governance. Rather, what really matters is the quality and engagement of the board, the tone set by management, compensation design, and a dedication to internal talent development and succession planning.
Teaching Social Responsibility and Ethics
Just a decade ago, teaching ethics to business school students may not have seemed like a natural fit within management education, but after questionable activities by so many financial industry executives leading up to the 2007–08 financial crisis, we have a greater obligation to our students and to the corporate world to emphasize social responsibility and ethics in today’s boardrooms.
With this in mind, Stanford GSB has assembled a strong team, including organizational behavior professor Benoît Monin, to lead its ethics education. This past year, Monin was tapped by the university to lead a faculty team to develop a new ethics course for undergraduates and to share best practices for teaching ethics. This is the type of commitment that defines the university’s role in educating the next generation of leaders.
Growing Companies: from Launch to Liquidity
Looking toward winter quarter 2014, faculty members Jonathan Levav (Marketing), Hayagreeva (Huggy) Rao (Organizational Behavior), and Joshua Rauh (Finance), will teach a new course titled Launch to Liquidity. The elective explores systemic patterns and decisions companies make as they approach their exit point for going public, pursuing a private equity sale, or following another strategy.