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New Day Dawning
Trade warrior Jeffrey Garten is SOM's man of the hour
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Business New Haven
10/23/1995
By: BNH
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Former dean Paul W. MacAvoy once likened the top job at Yale's School of Management to “herding cats.” That's the job that, starting November 1, will be in the hands of Jeffrey E. Garten, most recently U.S. Undersecretary of Commerce for International Trade. He assumes the helm of a school which, in some ways, is still on the mend from the turbulent 1989-91 deanship of airline executive Michael E. Levine, who gutted SOM's operations-research and organizational-behavior faculty, considered by many to be the heart and soul of the school's non-traditional curriculum. With experience in business (as a former managing director of Shearson Lehman Brothers Inc., where he built the firm's Tokyo office), government (advising the Nixon, Ford and Carter administrations before his most recent turn at Commerce) and academia (he taught economics and finance at the Columbia Business School), the 48-year-old Garten is a triple threat. A “big-picture guy” is how search committee member Barry Nalebuff characterizes him, saying “his combination of experiences”
in business, academe and government “is awful close to the SOM ideal.” Yale University President Richard C. Levin called Garten's appointment “a great opportunity to train leaders who are on the cutting edge of the ideas and skills necessary to meet the challenges of a brutally competitive global economy.” In addition to his duties as dean, Garten will join the SOM faculty in the areas of international trade and finance. BNH spoke to Garten on his penultimate day at Commerce about the challenges that lie ahead in New Haven.
Why SOM, now, for
Jeffrey Garten?
I think it's a wonderful opportunity to continue some of the things I have been very interested in over the last 20 years. My career has spanned several administrations - Nixon, Ford, Carter and Clinton - but I also spent about 15 years on Wall Street. In every incarnation I had a very strong interest in the global marketplace and in the issue of American competitiveness. The chance to be in an environment where I have the opportunity to help to train the leaders of tomorrow in business and the public sector - to me, that's a rare opportunity. And the fact that it's Yale, for which I have such great reverence, made it irresistible.
So, why now?
I just spent the last two and half years in Washington, and I thought this was a good time to make a transition to a new challenge.
Okay. Now, why Jeffrey Garten for SOM?
I can't speak for the search committee, but I'd like to think it's significant that they turned to someone with a lot of hands-on experience in both the business and public sectors - partially because one of the goals of the School of Management, in my view, is to produce leaders who are on the cutting edge of ideas, but who are also deeply grounded in the real world. I'd like to think that some of the experiences I've had would give me a good base to interact with the professors and students and to lead the school into the next century.
During your recent visits to New Haven, speaking with the administration, faculty and students, what sense did you come away with of the mood of the SOM community?
The impression I have is that after some ups and downs, certainly, the school is on a very firm basis, and that it is poised to move up the ladder very quickly in terms of its national reputation. My strong impression is that it has some of the best students in the country - really excellent students. And it's a small faculty, but highly impressive in terms of its academic credentials. So I feel like I'm walking into a situation where there is enormous potential to give it the kind of reputation in management as the [Yale] law school has in law. That's what I'm going to try to do.
The perception in the non-SOM community is that the school set out 20 years ago to create a new, non-traditional kind of model for the discipline of management. When Michael Levine came in, there was a perception that SOM was shifting to a more traditional MBA model. What are the characteristics of the best U.S. graduate business schools today, what characteristics does SOM share and how is it different?
Well, let me say that the first thing I'm going to do when I get there is to listen to lots of different groups to get a much better understanding of where the school is and where it should be headed. I want to spend a lot of time talking to the faculty, the students, the alumni and the various communities that are, in a sense, the consumers of the product - the business community, the not-for-profit institutions. I think I know enough about the public sector because it's fresh in my mind. But it's too early for me to define Yale's characteristics and what it should be. But there are a couple of points I can make at this point. One is, the United States doesn't need another Harvard Business School, or another Wharton, or another Stanford. I see Yale as being in that league, but different. And, like the law school, I hope that it has its own image that is special enough so that one-to-one comparisons are not appropriate. In my view, the underlying theory is that there are certain management skills that are common to handling any kind of enterprise or organization. One of the great advantages of the school is that it was built on a very farsighted premise. And going in, my intention is to cultivate that. A unique feature here is its small size. I'd like to see us be considered a real jewel - something that is small, exclusive and where the quality is basically unequaled anywhere else. I think the small faculty is a great advantage: Here is a chance for a tremendous amount of teamwork, and not the kind of divisiveness that characterizes bigger institutions. The very strong links between the School of Management and the university at large is a great advantage. This is not a school that is off on its own. There are great opportunities to link education in management to other areas - law, public health, international affairs, there are a variety of possibilities. And the caliber of the students is a great advantage. Not just the IQ, but the broad range of interests that seems to characterize the applicants. Of course, many of them are interested in making money, and I think that's - me, of all people, who's been an investment banker - that's great. But I think they have other goals as well. And my view of management for the future is that the most successful managers are going to have to understand their environment, very broadly defined. If they are in government, they need to be entrepreneurs. If they are in business, they need to understand what the public sector is all about. These students, and this faculty, and the size of the school, and its links to the university all make it a real possibility.
You mentioned management skills common to different settings. How is managing an academic institution of this sort different from, and similar to, managing in the private sector?
In terms of the skills that are common, I think that a knowledge of finance is crucial, no matter what kind of enterprise you're running. I think also a knowledge of human resources - how to deploy people, how to deal with people. It is also going to be really critical to have a sense of strategy - how do you think long-term, how do you plan, how do you negotiate to get what you want? I'll add another, newer, one: How to think about, how to manage, information technology. And these days, how to manage enterprises in a global environment will be really cutting-edge stuff. How to think about international risk, how to deal with it, how to accept it. Those five areas are very important to anyone who's managing a significant enterprise.
How does the fact that American businesses are now operating in a global arena affect the way we ought to train our leaders and managers?
I don't think anybody has as yet created the right formula. I can tell you as someone who's been deeply involved in international markets that most CEOs are still searching for the skills and the insights to do this in a way that American companies are going to have to in the next century. One area that's especially important is the ability to accept risk on a global basis - financial risk, market risk, risk inherent in brutal competition from other companies, risk of changing government policies abroad, risk of inadequate preparation of the local population. There are a huge number of risks that don't exist if you are investing in Pennsylvania, but which are very relevant of you are going to go to China or India or Brazil. I don't have the formula, but I would be very interested in working with the professors at the School of Management to come up with one. Between me and them and other talent in the university, we could put together the most far-reaching educational program dealing with the international arena that anyone has.
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