MSBA Students Meet Advisory Board Mentors

The Catholic University School of Business Advisory Board met recently to discuss the School's Mission, Vision and Values.  Following an update of the Master of Science in Accounting (MSA) and Master of Science in Business Analysis (MSBA) programs, a reception was held with the current MSBA class.  Advisory Board members serve as individual mentors for the graduate students. 


The mentor program is one of the most popular features of the MSBA program.  We appreciate the time and dedication these busy executives give to helping our students.

Stewart McHie
Director, Master of Science in Business Analysis
mchie@cua.edu

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The Economic Message of Pope Francis" "Evangeli Gaudium"

By Andrew Abela, Dean of the School of Business and Economics
The Catholic University of America

The Pope’s recent Apostolic Exhortation Evangelii Gaudium has some provocative things to say about the economy.  Dean Abela comments on the Pope’s words in the National Catholic Register. 

“Too narrow a focus by some commentators on  the economic aspects of Pope Francis’ apostolic exhortation Evangelii Gaudium (The Joy of the Gospel) risks hiding the unity of the Holy Father’s challenge to Catholics.

Francis wants the joy that “fills the hearts and lives of all who encounter Jesus” (1) to spread through evangelization, with a renewed effort to serve the poor (48). He gives us both principled and pragmatic reasons for prioritizing this concern for the poor. First, because God wills it (187). Second, because this would be the “‘the greatest and most effective presentation of the good news of the Kingdom’” (199; quoting Blessed John Paul II). Imagine the powerful impact and witness of 1.2 billion Catholics around the world working diligently and daily to improve the lives of the poor. Third, the inequality and lost productivity of the poor is a drag on the growth of the global economy and will lead to further economic crises (202).

He asks us not only to perform “small daily acts of solidarity in meeting the real needs which we encounter,” but also to “work to eliminate the structural causes of poverty and to promote the integral development of the poor” (188).

What are these structural causes, and how do we eliminate them?”   Read more here.

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An Oh-So-Brief Brief On Digital Money

By Kelly Campbell, Founder and CEO of Campbell Wealth Management, Alexandria, VA

If you read or watched the news during the past few months, you may already know this, but there has been an explosion of interest in digital money. That’s the reason you may be hearing and reading about dozens of companies that are rushing to coin virtual currency that has real value. It just seems so 21st Century, doesn’t it?

Odds are you’ve already used digital money. For example, you used it the last time you

purchased something online. Digital money is what we use when we pay or are paid electronically. Think smart phones and credit cards. Digital money is not tangible; however, it is possible to convert digital money that is part of a large centralized banking system into paper money by making a withdrawal from an ATM.

In the United States, the Federal Reserve is responsible for maintaining the integrity of U.S. bills and coins by setting monetary policy. Digital currency companies offer a parallel currency universe; a means of transferring electronic money from one person to another without using traditional banking or money-transfer systems.

Digital money companies appear to be delivering American economist Milton Friedman’s dream, according to The Economist. Years ago, Friedman suggested the Federal Reserve be abolished and replaced by an automated system that would increase money supply at a steady, pre-set rate. He believed such a system would better control inflation, making spending and investment decisions more certain. The Economist article said:

“In theory, then, the system ought to keep a lid on inflation – making it attractive to critics of interventionist monetary policy of the sort practiced since 2008 by America's Federal Reserve under the label quantitative easing… It offers other apparent benefits, too. The currency can be used by anyone (unlike credit cards, for instance), anywhere. Transaction costs are also likely to be lower than those for traditional payment systems, though these are not in fact zero…”

The Economist goes on to point out a key difference between central-bank-controlled currencies (which often offer both bills and coins and digital currencies) and digital currency companies is the former are backed by a country’s regulations and laws; the latter are answerable to online communities using the currencies.

Kelly Campbell
Founder and CEO, Campbell Wealth Management
Alexandria, Va.

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Professor Brian Engelland Wins Lifetime Marketing Award

Brian Engelland was tapped as this year’s winner of the Lifetime Marketing Contributor award by the Society for Marketing Advances. The award was announced November 1^st by the society’s president, Dr. Christopher Hopkins, at Hilton Head, South Carolina, in conjunction with the society’s 51^st annual meeting. 

In announcing the award, Dr. Hopkins said, “I don’t know anyone who has done more for the field of marketing at all levels than Brian Engelland.  As a marketing executive, he launched hundreds of products that have made life better for consumers; as an educator, he has inspired thousands of marketing students; and as a dedicated scholar, he has helped spread advances in marketing across America and around the world. All of us in the society continue to benefit from his mentorship.”

Engelland’s research focuses on issues in marketing management, measurement, and education. He has authored over seventy refereed publications and four books, won nine best paper awards, six teaching awards, and been named as a fellow of the Marketing Management Association

Dr. Engelland is better known at The Catholic University of America as a Professor of Marketing and Associate Dean of the School of Business and Economics. During the MSBA class of 2014’s orientation Professor Engelland ran a case study workshop involving Walmart coming to Washington, D.C. Prior to becoming an academic, he was a product development executive and served in a series of leadership positions for two Fortune 500 corporations.

We are proud of Brian's many contributions to the field of marketing, The Catholic University of America and particularly the MSBA program.

Stewart McHie
Director, Master of Science in Business Analysis
mchie@cua.edu

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Pay Yourself First

Last week's Thirsty Thursday speaker was Kelly Campbell, Founder and CEO of Campbell Wealth Management in Alexandria, Virginia.  Kelly is an annual visitor to the MSBA Class with an important message for all students.

                  "Pay Yourself First" 

Saving for retirement, which seems a lifetime away, HAS to begin as soon as you receive your first paycheck.  Savings is not about the amount of money you save, it is about the lifelong discipline you establish from day one of your work career.  Establish three separate funds; an emergency fund with 3 to 6 months of living expenses, an interim fund for major purchases, vacations, etc. and a retirement fund.  It's important to fully fund the emergency fund first and then contribute to the latter two.  

A regular savings discipline and compound interest over a 30 or 40 year career will put you in a position to retire early and realize your dream of becoming a Graduate School Program Director!  

Other subjects covered by Mr. Campbell were Budgeting, Investing, Roth IRA, Avoiding Debt, Evils of Credit Cards, Student Loans, and Life Insurance.  

Mr. Campbell left the students with three nuggets of wisdom:
1) There is plenty of opportunity for the properly educated and hard working student.
2) Whatever you do, do it with integrity
3) Take the bull by the horns.

and three book recommendations:
1) The Secret by Rhonda Byrne
2) The e Myth by Michael Gerber
3) Start with Why by Simon Sinek

As always, this was a most popular session with students and an important benefit of the Master of Science in Business Analysis program here at CUA.  Kelly has promised a return engagement in the Spring for a Thirsty Thursday session on markets and investing alternatives.

Stewart McHie
Director, Master of Science in Business Analysis
mchie@cua.edu

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Congressman Fortenberry lectures in MSBA Program

Submitted by Jack McCann-MSBA Class of 2014

On Monday, October 28, 2013, Congressman Jeff Fortenberry (R-NE) visited the MSBA program as a guest lecturer for the Spirit of Enterprise class.  He spoke broadly about the

Beautiful Fall day so we
handled introductions in
the Quad...

frustrations many Americans are currently facing and the importance of maintaining social institutions that promote healthy communities and the common good. 

Congressman Fortenberry has a masters in theology from Franciscan University of Steubenville and a masters in public policy from Georgetown University.  The MSBA students were impressed by his breadth of knowledge and experience.  Among the topics discussed were the application of philosophical principles, natural law, and economics in the practical world. 

He challenged students to use the theoretical foundation and practical knowledge they receive in the MSBA program to strengthen society and promote communities that are ordered to the common good.  He used current MSBA student Julie Larkin’s work of starting an organization dedicated to helping young women understanding their dignity as one of many ways to improve the lives of others through business. 

...before moving into
the classroom

The class concluded with a story from Congressman Fortenberry’s personal experience as a legislator.  He described in detail how he managed to guide a bill concerning adoption through Congress to be signed into law by the President.  The story illustrated not only the importance of knowing the right thing, but also knowing how to do it.  He left the class with three principles that are needed to make an impact: policy, one must have an idea that makes sense and is implementable; process, one must understand procedures necessary to complete the goal; politics, one must have the relationships and the network of people willing to help. 

The MSBA class truly enjoyed Congressman Fortenberry’s visit and is looking forward to welcoming him back to Catholic University soon.

Congressman Fortenberry is a frequent guest lecturer in the MSBA's Spirit of Enterprise class and Leadership and Entrepreneurship as Service class.

 

Jack McCann

MSBA class of 2014

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Entitlements: Why We Can't Wait

MSBA student Melissa Guay, who is interning at the US Chamber of Commerce, wrote this report for the Chamber summarizing the recent Business Horizon Retreat on this important subject.

Entitlement spending is a growing concern for Americans and our country. Reforming these

Melissa Guay

unsustainable programs–most especially Social Security, Medicare, and Medicaid–will help reduce deficit spending and protect these programs for future generations. To address these issues, the U.S. Chamber of Commerce Foundation hosted a Business Horizon Retreat on September 24, 2013, titled “Entitlements: Why We Can’t Wait.” The event featured conversations with leading experts who examined the costs of these programs and their implications for the federal budget, the national demographic shifts  contributing to these costs, and possible common-sense reforms.  

Read the rest of the report here and access the data slides here.


Stewart McHie
Director, Master of Science in Business Analysis
mchie@cua.edu

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Finding Room for Faith

From Blog post by MSBA student Laura Caporaletti

Unlike the majority of my peers at Catholic University, I had attended public schools for grades K-12.  All my life, I was accustomed to keeping my faith separate from school; God was something for Sundays only and prayer only took place before bed.  A huge reason that I chose to attend CUA for college was because I wanted my faith to become the cornerstone of everything I did.  I wanted to learn about Catholicism in class, I wanted to walk by crucifixes in the hallways, and I wanted to make friends who shared my passion for Jesus.  CUA proved to offer all of this and more, and over the course of my undergraduate career, my life become centered around my Catholic faith.  I had no idea that this would be a hard lifestyle to maintain while attending CUA as a graduate student.

The name of the game in grad school is stay alive.  Okay...I exaggerate.  However, to describe my life as extremely busy during this nine month Master's program would be accurate.  I am slowly but surely learning how to balance a part-time job and a full-time student work load in a discipline that I am not used to.  I am learning, mostly through trial and error, what I do have time for this year and what I don't.  I have learned that this is going to be a year when my social life takes a hit, my gym card isn't swiped nearly enough, and a full night's sleep is what my naps senior year of college looked like.  But I am okay with all of this, because at the end of it all, I will have earned my Master's degree and will be one step closer to obtaining the career of my dreams.  

What I am not okay with is this becoming a year where my relationship with God is put on the back burner.  Unfortunately, this has been more of a challenge to prevent than I had ever anticipated.  I am no longer taking courses in theology, I am in class or at work during every conceivable mass time, and I fall asleep before I get through one Our Father at bed time. 

Upon realizing this and feeling the difference this lack of God made in my life, I made an appointment to meet with one of my favorite professors here at CUA - Professor Andreas Widmer.  I explained to him that I was struggling to find room for faith in my schedule that seems to become busier everyday.  He told me to begin offering the work that I am doing in this program (the mornings I wake up at five a.m. to finish homework, the late nights working on a group project, the stress and anxiety I feel during midterms) as a prayer.  In offering these moments up to God or as prayers for others, our work life becomes one with our spiritual life.  God would cease to become something that I would need to find room to squeeze into my life, and He would again become the cornerstone of everything that I do.  I was so appreciative for this advice and plan on living it out as best I can for the rest of my time as a grad student at CUA.

Laura Caporaletti
MSBA Class of 2014

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Social media with a purpose

Gary Steel from Carnegie Communications is conducting a workshop on Social Media, SEO, analytics and writing for social media.

Fantastic opportunity for our MSBA class. All students have blog sites to experience real exercises rather than just theoretical. 

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Importance of public speaking

I received this nice memo from Tia Bent, MSBA class of 2013.

I wanted to thank you for accepting me into the program and helping work through my public speaking issues last year. It still bothers me, but I spoke on a panel last week with over 100 people in the audience on mental health and veterans issues with Frank Sesna from CNN as the moderator.

I know without doing the program last  year I would have never put myself out there for an emotional topic, especially for a large group of people being recorded.

Please send a big thanks to the rest of the professors for me.

https://www.eventbrite.com/event/828

Stewart McHie

Director, Master of Science in Business Analysis

mchie@cua.edu

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Foundations of Entrepreneurship Research - Part 1

By: Frederic Sautet, Visiting Associate Professor of Economics, Catholic University

Dr. Frederic Sautet is an economist who specializes in market process and entrepreneurship research. 

"Entrepreneurship” has become a buzzword in recent decades. It is not only an important field of research but it is also a major instrument in economic policy, and politicians of all stripes see small businesses and entrepreneurship as a cornerstone of American success. 

The hype around entrepreneurship was not always the case. In fact for a long time between the 1920s and the 1980s, hardly anyone in economics and policy would discuss entrepreneurship. While entrepreneurship was a fundamental function of the market system (the system of “free enterprise”) for economists of the 19^th century, this notion disappeared completely with the mathematization of the discipline in the following century. As P. Kilby stated, most authors “whether explicitly or simply by virtue of omission, consider[ed] entrepreneurial supply to have played a passive part in the drama whose major themes were invention, changing factor prices, and new market opportunities.” Indeed, instead of considering the entrepreneur as having the central role in a country’s economic performance, post-WWII economics came to consider structural conditions and other macroeconomic factors as key to growth and development.

This has changed. Today there is plethora of research that indicates the overwhelming importance of entrepreneurship in economic performance. Although some of the largely shared views are sometimes not true (e.g. empirical analysis shows that small businesses are not a major source of new jobs), it is still the case that entrepreneurship is the driving force of the market, to paraphrase Israel Kirzner.

In order to understand why entrepreneurship has become so important in economics, policy, and politics, it is important to go back to the root of the discipline and look at its theoretical foundations. One distinction that is important here is the one between entrepreneurship in the behavioral sense (i.e. what entrepreneurs do) and entrepreneurship in the cognitive sense (i.e. what entrepreneurs are, or what the function of entrepreneurship consists of). Grasping this difference is vital because without it, one does not understand why many authors use the same word (“entrepreneurship”) but seem to talk about different things. In my next post, I’ll develop the ideas behind this distinction.

Contributed by Dr. Frederic Sautet

Visiting Associate Professor of Economics

The Catholic University of America, School of Business and Economics
sautet@cua.edu 

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What No Textbook Can Teach You

By: Andreas Widmer, Director of Entrepreneurship Programs

Andreas Widmer is Director of Entrepreneurship Programs at The Catholic University of America and President of The Carpenter’s Fund. He is also the author of The Pope and the CEO, chronicling the lessons of a young Swiss guard serving Pope John Paul ll. 

The raison d’être of a business goes far beyond profitability. It’s true that a business needs profit like human beings need oxygen. If you take it away, certain death will be the consequence, yet it’s not our primary reason for living. 

A business lives out of something much deeper than just profit. There’s more to business than what is traceable in a textbook. At the core of a business is something that can’t be easily explained. It’s more of a feeling than a fact. So how does one best convey that to an aspiring business student?

At CUA, our freshmen business students’ first assignment is to each start their own “company.”  Specifically, each student is asked to start a special interest blog. By exploring what they have to offer others in terms of their unique interest or expertise, they create a website that explains and explores this topic and recommends various products along the way.

These blogs are then monetized in part through strategies such as affiliate marketing. As an affiliate of websites like Amazon, the student earns a bonus each time someone buys through one of their links. Thus each student creates their own “small business” during the first semester of their freshman year.

This simple exercise serves better than any lecture I could give or any book I could recommend to have someone experience the true purpose and motivation of business: Business is not selfish but inherently “other directed.” Businesses have to offer a product or service that target customers are willing to buy. Business starts with putting myself in the other person’s shoes to see the world from his or her perspective. That is the substantive difference between selfishness and self-interest.  It’s a point that you can only learn by doing.

And learn they do: Every time I teach the course, I am astonished at the marvelous expertise, experiences and knowledge the students have to offer. Their blogs range from how to raise chickens to where to buy the best makeup, from starting an art collection to finding the ideal community service, and they never cease to amaze me.

Have a look yourself (and spread the word!) And if you like one, please tweet it with the hashtag #CUAstudentblog.

The process of business is simple but profound: You start simply with a thought, an idea in your head. By focusing on it and your action, it slowly becomes a physical reality. You have become a creator. In fact, this act of creation exactly mimics the very first act of creation: God thought of the world and it came into existence.  Think about it: when we work, we actually imitate God! This is why I believe that business is a noble calling, even a spiritual undertaking. It is in the very sense of the word a path to holiness.

Contributed by Andreas Widmer
Director of Entrepreneurship Programs
The Catholic University of America, School of Business and Economics
widmer@cua.edu

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Career Advice from an Expert

Bradley Peacock, President of Peacock Nine, LLC  in Chicago, Ill recently spent an evening with the MSBA class giving them ideas and tips for career and life success.  Bradley, an English major and Oxford graduate is a long time associate of Program Director Stewart McHie.  He has visited with each MSBA class over the past 4 years and is one of our most popular guests.  His advice to students in this tough environment is to keep your weirdness, stay curious, and be ready to pivot.  

Students need something to stand out from the crowd and must be passionate about something that sets them apart from all the other job applicants.  Interviewers won't remember that you claim to be an extremely hard worker (who doesn't), but they will remember you are a kayaker and have a goal of running two class fives a year.  Curiosity is a trait every one needs today, particularly given the fast pace of change.  And be ready to "pivot" or go in a different direction when the opportunity or circumstances dictate.

His 4 keys to success are summed up in an acronym PAWS; passion, association, work, and service.

We always appreciate Bradley's sacrifice of his time to visit with the class and become an important part of their professional network.

Stewart McHie
Director, Master of Science in Business Analysis
mchie@cua.edu

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Visit to Chamber of Commerce inspiring

The MSBA class was fortunate to visit The US Chamber of Commerce in downtown DC and spend a couple hours with Ricard Cooper, Vice President of Emerging Issues and Research and Melissa Vruggink, Associate Recruiter in Human Resources.   Rich told the students their generation will be "the one to change the rules."  They will have to deal with issues such as Big Data; how much is too much, the ethics of bio engineering, and small business issues which is where job creation is.  Cooper believes this generation will be more corraborative and that will be essential to working through these critical issues.

His advice to the class is to become a life long learner, be constantly curious and venture out of your comfort zone.  It is important to examine an issue from all sides, not just the lens you are comfortable with, in order to understand, debate and effect change.

Skill sets our next generation of workers need include efficient means of engagement.  The 20 page white paper is extinct, learn to write in a concise and clear manner, one page is hard but essential.  Learn storytelling and how to grab attention in the 6 seconds that research says is our attention span. 

Opportunities will be in the cyberscape which Rich described as the "nerve center of everything".  This will cross over into cyber security, healthcare, protection, infrastructure and privacy issues.  Challenges will be adapting to the speed in which commerce and technology evolve and finding work life balance in a 24/7 world.

In closing Rich advised that success for the life long learner looks like, "I haven't thought of it that way".  It was a tremendous experience and we are grateful to Rich, Melissa and the Chamber for this opportunity.

Stewart McHie
Director, Master of Science in Business Analysis
mchie@cua.edu

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A Fulfilling Career Path: Finding your Passions

My last class with the MSBA students revolved around the best way to answer the tough interview questions. One of the more difficult as well as common questions we came across was,
                                  "What makes you unique?/ Why should I hire you?"
In one way or another, you will be asked this in an interview. So how can you be unique from other recent graduates or current students?

A great way to differentiate yourself from other candidates when interviewing is to explain what your passions are. If you are having trouble discovering what you are passionate about, fear not!

Below is an article/ quiz you can take to help you figure it out. Finding your passions will also help you in discovering a career path that will be most fulfilling- the ultimate goal of today's job search.

The Passion Test

Speaking of fulfillment, here is an article breaking it down for us Generation Y-ers as to why our jobs are not living up to our expectations. Below is the advice given as you continue your search for a fulfilling career.

Why Generation Y Yuppies are Unhappy
1) Stay wildly ambitious. The current world is bubbling with opportunity for an ambitious person to find flowery, fulfilling success. The specific direction may be unclear, but it'll work itself out -- just dive in somewhere.
2) Stop thinking that you're special. The fact is, right now, you're not special. You're another completely inexperienced young person who doesn't have all that much to offer yet. You can become special by working really hard for a long time.
3) Ignore everyone else. Other people's grass seeming greener is no new concept, but in today's image crafting world, other people's grass looks like a glorious meadow. The truth is that everyone else is just as indecisive, self-doubting, and frustrated as you are, and if you just do your thing, you'll never have any reason to envy others.


Marykate Kelly
Corporate Relations Manager, School of Business and Economics
kellyf@cua.edu

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Character in Advertising

This post is from Matt Patella, MSBA Class of 2014.  I couldn't agree more with Matt's observation.  Do have the tissues handy.

Beer companies are constantly coming out with commercials. Often times the characters are funny or sexy, rarely are the ads heartwarming. The advantage to creating a heartwarming ad that hits customers at their core is that people will remember the commercial and with the help of the Internet share the commercial. Guinness has created the most recent beer ad that you may want to watch with a box of tissues. In one minute Guinness tells the viewer a story of a group of friends who are willing to go to extremes to play basketball together. The slow song being played during a rough game of basketball indicates there can be more to this game then meets the eye. This ad is popular because it seems to be promoting more than just a beer, it is promoting strong character. The old phrase “A Guinness for Strength” has a whole new meaning now.

http://www.youtube.com/watch?v=aLgDQcdRL-I     (you may have to paste link into your browser)

Matt Patella

MSBA Class of 2014

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MSBA Student gets job at KPMG

From Anthony Astorga

MSBA class of 2013

 

I am proud to announce my acceptance as a Senior Analyst with the Big 4 firm, KPMG.  My main responsibilities will be to evaluate the design and technology of controls through the business cycle and evaluate IT audit findings.

My journey to this position all started when I saw information on the MSBA program on a flyer on the CUA campus.  After reading more, I decided to take a chance and apply for a Master's program.  The day before my undergraduate graduation in 2012, I received a call from Stew McHie (MSBA Program Director) that I was accepted into the program.

You don't just get an education from the MSBA program, you get to experience real world scenarios in which you are put in the position of a business professional making important business decisions.  An example of this is the Field Team Study with Amtrak that taught me
about teamwork, perseverance, and making the client happy.  I use these skills in the office every day and working with a team is easier now than ever before.

After working with Kristen Rompf (Career Development Professor) on my resume, cover letters, and interview skills, I decided to apply to multiple companies including KPMG.  Low and behold, I received a call after graduation from a recruiter at the firm saying how much they liked my resume and how I would fit in perfectly in the firm.  Now I am starting a new career in the position I wanted with one of the best accounting firms in the world.

The MSBA program is unlike any education I have ever received and I am eternally grateful for the dedication, experience, and support that came from everyone involved in the program.

We all wish you well Anthony.

Stewart McHie
Director, MSBA Program

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MSBA Intern Attends Town Hall Meeting with US Senator

McHie and Obiakor examine
equipment at the EMBLOCK Company
plant.

Everistus Obiakor, MSBA Class of 2014, was invited to attend a town hall meeting of small business owners with Senator Ben Cardin, (D-MD) at Ernest Maier Inc. in Bladensburg, MD.

Ernest Maier CEO Brendan Quinn invited Everistus and Program Director Stewart McHie to join the plant tour and sit in on a frank discussion with Senator Cardin about the financial plight of the small business owner.  Health care requirements, taxes and bureaucratic red tape were all discussed as interfering with the growth and success of small

Senator Ben Cardin (D-MD)

businesses. The Senator defended the Obama Health Care Plan and promised to look into the lack of information reaching the business owners.  He acknowledged that small businesses are the job creators of the future.

Everistus will intern with Mr. Quinn and be involved with both his domestic business and business interests in Angola.  Assistant Dean Phil Brach who introduced Mr. Quinn to the MSBA program also attended the event.


Stewart McHie
Director, Master of Science in Business Analysis
mchie@cua.edu

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Greed, Profit and Public Opinion

This thoughtful commentary was written by Brian Engelland, PhD, Associate Dean and Professor of Marketing at the Catholic University School of Business and Economics.  We invite your comments.

Corporate greed certainly played a large role in the housing market crash. But to say that all corporations are greedy is a gross mischaracterization. Yet that seems to be what many people believe.

The general public exhibits a pronounced misunderstanding of the profit-motive that is part of corporate DNA.  I often hear complaints that big companies only care about making money, and by their nature, don’t care about employees, customers or the needs of society at large. This misconception is reinforced by news reporting that focuses on corporate greed rather than the good that businesses do.  

Some media outlets project the attitude that profit is a four-letter word and when profits increase, it must mean that customers, employees or the general public is getting the shaft. A sampling of recent news headlines reveals the following examples: “Energy Suppliers Pocket Biggest Profit Margins in Two Years as Households Suffer,”  “Banks Cut Services to Maintain Profits,” and “Cash Grab by Big Business.” 

This anti-profit attitude fails to consider the fact that failing businesses don’t create new products and services, don’t hire new employees and don’t create economic well-being.  Only profitable businesses do. So when businesses post improved profitability, it is not a bad thing, it’s a good thing.

Many sources like to quote Milton Friedman who is credited with saying, “The one and only obligation of business is to maximize profits.” This statement makes for a memorable sound bite, but it is equivalent to saying that the only obligation of a human person is to breath air. Sure, profits are necessary for business survival just as breathing is necessary for human survival.  But profits or breathing is not the only obligation.

Humans exist to accomplish a whole host of strongly-held objectives, including working, forming loving relationships, raising families, and learning. Similarly, businesses seek to accomplish many objectives, including the creation of high quality products, the service of customers, and fair treatment of employees. Granted, profitability is needed or the firm will not survive for long.  But profit is more of a score-keeping discipline than a driving force.

Pope John Paul II said it well: ““Profit is a regulator of the life of a business, but it is not the only one; other human and moral factors must also be considered which, in the long run, are at least equally important for the life of a business.” —John Paul II, Centesimus Annus, 35.

Businesses serve an important and irreplaceable role in this world.  According to the Pontifical Council of Justice and Peace document, The Vocation of the Business Leader: A Reflection, business is a noble calling to participate in God’s ongoing creation.  Businesses create products and perform services that individuals or government bodies are ill-equipped to provide. These products and services make the challenges of life (transportation, education, housing, food, and healthcare) easier to bear.

Business leaders I know run their organizations so as to balance the needs and desires of multiple stakeholders, including consumers, employees, suppliers, and the community in which the business is located. Their daily concerns involve product quality, new product innovation, employee training, and supplier partnerships, to name a few. Those businesses that achieve success in these areas achieve consistent profitability. But there is an important chain of causality here. Profits arise not because they are the over-riding goal. Rather, profits arise because of a focus on all of the individual, people-related elements of running a business that involves customers, employees, suppliers and community.

Putting people first tends to yield a prosperity dividend that enables the business to continue. Pope Leo XIII wrote “[W]hen Christian morals are completely observed, they yield of themselves a certain measure of prosperity to material existence.”— Leo XIII, Rerum Novarum, 42.

When an individual or business operates according to Christian principles, there is a certain order that follows and a degree of success is achieved in this world. The key is person-centeredness. When we reduce the content of business to performance metrics like profits, we miss the soul of business life: people.

Businesses exist to serve people with products, services, jobs, and the necessities of life. When businesses do well in accomplishing those objectives, they are rewarded with prosperity to material existence.  In other words, investors earn a return on their investment. That return is called profit.

News media have a moral obligation for truthfulness, accuracy, objectivity, impartiality, fairness and public accountability.  Their over-emphasis on profit in business creates the potential for misleading the public.  So come on, news media, get with it!  If the public had a better understanding of the profit motive, we would all be better off.

Brian Engelland, PhD
Associate Dean
Catholic University School of Business and Economics

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A Message to Garcia, 1899

Originally published in 1899, by Elbert Hubbard, this classic deserves a wide audience even in these more modern times. This is a timeless case study on management delegation and staffer initiative. 

A Message to Garcia

By Elbert Hubbard

In all this Cuban business there is one man stands out on the horizon of my memory like Mars at perihelion.

When war broke out between Spain & the United States, it was very necessary to communicate quickly with the leader of the Insurgents.

Garcia was somewhere in the mountain vastness of Cuba- no one knew where. No mail nor telegraph message could reach him. The President must secure his cooperation, and quickly. 

What to do!

Read the story here.

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Be sure to follow Your Business Professor on Twitter: @JackYoest 

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Class of 2014 off to a great start

We welcomed our 4th MSBA cohort to campus with a series of activities last week.



On Wednesday evening, a reception was held in our graduate lounge for new students and faculty to get acquainted prior to the start of classes. 






Toughest task facilitator Eric Powers
has thrown at us - the Devinci Arch.

Laura conquers the Flying Squirell

We spent Thursday at the Go-Adventures ropes course in Darnestown, MD for a day of team building and problem solving.  This was a mix of fun and challenging activities.  We found we have a very competitive group that does not like to fail at completing a task.  I was very pleased with the participation and comraderie of the group.  We're going to have a good year!

  

On Friday, we completed the orientation exercises with a day on campus and an interesting case study about the current Walmart-DC City Council dispute over fair wages.  The students worked in small groups to defend one of the four constituencies in the debate.  Presentation and speaking skills were quite good and gave us a baseline to work from.

Our cohort of 19 students hails from 10 different universities including Notre Dame, Georgetown, William and Mary,  Rutgers, Howard, Boston College, LSU, Ave Maria and Thomas Aquinas.  We have students from 4 countries which adds to a wonderful spirit of diversity.

Stewart McHie
Director, MSBA Program
mchie@cua.edu

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Leadership Lessons Where Failure Is Deadly

Leadership is important in any business. But the military has a real incentive to get it right: The cost of failure is not merely, say, missed quarterly earning but dead team mates.

So what goes into military management training? Read this short overview 7 TOUGH LEADERSHIP LESSONS FROM A NAVY SEAL COMMANDER.

And be sure to follow Your Business Professor, a former Army Captain, on Twitter @JackYoest 

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The Real Scoop on Student Loan Interest

Contributed by Kelly Campbell, CEO, CFP®, ChFC®, CMFC®, AIF®
Campbell Wealth Management
Alexandria, Va

So you have Student Loans and are you getting a little concerned about
what the government has done to interest rates.

Kelly Campbell, CEO,
Campbell Wealth Management

Well for those of you with existing loans, don’t worry. The new rates will not affect you. For those of you who plan to take out a loan for the 2014 fall semester and later, you’ll get a break as your loan interest rate just got cut in half.

President Obama signed into law legislation that locked the Federal Student Loan interest rate which was set to increase (as of July 1^st) from 3.4% to 6.8%.) The new law has tied the rate to the ten year treasury. Now students know what their long term loan rate will be even after they graduate. This makes it easier to plan for post graduate expenses.

Below is a table that shows whose loan is subject to what rate.

Type of Loan	Interest Rates
Direct Subsidized/Unsubsidized Loans (undergrads)	Fixed at 3.86%
Direct Unsubsidized Loans (graduate/professional students)	Fixed at 5.41%
Direct PLUS Loans (parents and graduate/professional students)	Fixed at 6.41%

 Ok, Ok but what does that mean to you? That is the real question.

First and foremost, for those of you still in school, it does not mean much because as long as you are taking classes, your payments are being deferred (except for PLUS Loans). But once you graduate, that specified rate will kick in and you will begin making payments based on that rate. While this percentage is likely to stay somewhat constant over the next two years, it will almost definitely rise after that. That rise could be substantial. The law also sets maximums on the loan rates for undergrad, graduate and Plus loan programs at 8.25%, 9.5% and 10.5% respectively.

Second, let’s put it in dollar terms. The table below shows the average payment for a student based on a $10,000 and $20,000 debt level after graduation.

Subsidized debt after grace period	Payment based on old rate of 6.8%	Payment based on new rate of 3.4%	Payment based on a max increase to 9.5% (grads)
$10,000	$115.08/mo	$98.42/mo	$129.40/mo
$20,000	$230.16/mo	$196.84/mo	$258.80/mo

So the thing to be thinking about is how you will be able to repay your loans when your payment period begins. Also for those of you who will be taking on more debt over the next few years, as the ten year treasury increases, so will your payment amount. Good luck and be sure to get a job quickly after you graduate.

 Kelly Campbell

 

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