Transportation Summit: Trains, Planes, & Cars
Corrections or additions?
These stories by Kathleen McGinn Spring, Michele Alperin, and
David McDonough were prepared for the March 7, 2001 edition of U.S. 1
Newspaper. All rights reserved.
Different Leaders For Different Cultures
A high volume, low margin business needs to be intensely
focused on keeping costs down. A restaurant, for example, might
arrange
its salad bar so that high priced items are set in the middle,
creating
too great a stretch for less ambitious restaurant patrons, and
generates
greater profits. A life sciences business, on the other hand, needs
to think big and look toward the future. “We can’t save ourselves
to success,” says Ben Dowell, vice president of the Center
for Leadership Development at Bristol-Myers Squibb.
Dowell, who spent much of the early part of his career working for
Pepsico, understands both types of business focus. And he knows that
each calls for a different kind of leader. He also knows that the
nature of a company’s product is not the only variable in determining
whether a certain individual will flourish in a leadership role there.
“In some companies, getting results is all that matters,”
Dowell says. In others — and he says his is such a company —
that attitude is a negative. “We want results,” says Dowell,
“but getting results at any cost is not tolerated at Bristol-Myers
Squibb.”
On Thursday, March 8, at 8:30 a.m. Dowell speaks on “Leaders
Developing
Leaders: Navigating Rough Waters” at the Princeton Chamber of
Commerce’s leadership seminar at the Nassau Club. Cost: $50. Call
609-520-1776.
Dowell holds a psychology degree from the University of Texas and
a PhD in industrial psychology from the University of Minnesota. He
joined Squibb a little over 12 years ago, just before it merged with
Bristol-Myers. He has been head of the Center for Leadership
Development
for five years. Before joining Squibb he worked in a number of
leadership
development and human resources roles for Pepsico and its
subsidiaries,
at one point spending 90 percent of his time traveling around the
world. “You see exotic places, but after a while, you just want
to be home,” he says of that life. Now he lives in Lawrenceville
with his wife, Viki. Their daughter was married recently.
Leadership development centers like that at Bristol-Myers, which has
a staff of 18, are unusual in corporate America, Dowell says. And
while his company devotes a lot of resources to nurturing leaders,
he says the most important elements of the job are within the reach
of every business. The basics include:
Hire for your culture. In his chamber talk, Dowell plansto discuss “the peer from Hell.” At some point or other everycompany has one — at least one. Dowell admits to hiring thisspecieshimself. And the problem nearly 100 percent of the time, he says,does lie in the hiring. When he let a wildly unsuitable candidatein the door, it was because he was so taken by the individual’s skillthat he neglected to look into the culture in which the person hadbeen working. “And he came from a pharmaceutical too,” Dowellsays. The difference was that the candidate had been used to anatmospherewhere “you were told what to do and you did it.” Thus trained,this particular “peer from Hell,” failed to adapt to anatmospherewhere initiative and personal judgment were valued.Seek diversity. Bristol-Myers contains every sort ofdiversity,says Dowell. If the company finds it is missing a slice of the humanspectrum, he says, “we get it.” Illustrating why he thinksa diverse company covers every leadership base, Dowell talks abouta neighborhood birthday party he attended last week. “We wereplaying a game — unscrambling words, matching faces andnames.”For each task, there was one person who made the greatestcontribution,but no one made the most valuable contribution to more than one task.Give continual feedback. “You don’t have to spendmoney,” Dowell says. “If you want a leader, ask him to lead,and then give feedback and coaching.” It’s the bicycle principle,he says. All the workshops and classroom instruction in the worldwon’t produce a great bicyclist, or even an adequate bicyclist. It’sessential to get on a bike. And fall off. And try again. The samething goes for leadership. “You won’t be CEO of a $20 billioncorporation the first day,” he says. “It’s a gradualprocess.”At Bristol-Myers, performance partnerships have largely replacedevaluations,Dowell says. The goal has shifted from evaluating past performanceto encouraging strong future performance. Supervisors are to givetheir charges feedback every single day, recognizing positiveperformanceand pointing out areas for improvement.It’s important for leaders in every organization to “createa picture of where you’re trying to take things,” Dowell says.And that’s true whether the priority is to cut down on peeled shrimpconsumption at the salad bar or to be the first to find a cure forcancer.— Kathleen McGinn SpringTop Of PageDoing Deals With MexicoMexico, our next-door neighbor and NAFTA partner, servesNew Jersey businesses as both an export market and a production site.To establish a foreign presence, a company usually begins by findingan agent, then acquires a warehouse, moves on to contractmanufacturingwith a local firm, and finally builds its own plant. This processtakes three to four years with most countries, giving a business timeto feel its way. But in Mexico things move much faster. Businessesquickly become aware of the advantages of doing business with Mexicoand move quickly.Raul Gonzalez, deputy trade commissioner at the Trade Commissionof Mexico in New York, Beatrice Prati, partner at Feltman,Karesh,Major & Farbman, and Jonathan Plimpton of Church & Dwight speakat International Business over Breakfast on Thursday, March 8, at8 a.m. at Mercer County Community College’s Center for GlobalBusiness.Keld Hansen, the center’s director, will moderate thediscussion.Call 609-586-4800, ext. 3639 or E-mail hansenk@mccc.edu.The advantages Mexico offers to New Jersey businesses include acontiguouslocation and significantly lower labor costs. “In Mexico, thereis such a dramatic difference in labor costs, it quickly makesfinancialsense to establish your own plants,” says Hansen. “You payless for a day’s work in Mexico than for an hour’s work here.”Another advantage is the absence of tariffs. The main purpose of the1994 NAFTA agreement was to lower tariffs among the three signers:Mexico, the United States, and Canada. Today Mexico is a partner in10 free trade agreements covering 31 countries. Before theseagreementscame into force, manufacturers in Mexico had to figure an additional20 to 30 percent in product costs for customs duties. With thereductionof tariffs, exporting and importing between signatories is far easier.”Exports to Mexico from New Jersey, in dollars, have doubled since1994,” says Hansen.To certify to the U.S. and Canadian governments that an export wasindeed produced in a NAFTA region, companies operating in Mexico mustobtain a certificate of origin from Mexico’s Ministry of the Economy.For a product to be certified, a specified percentage of total productcosts, including labor and raw materials, must be incurred in Mexico.The percentage varies by economic sector. When importing industrialgoods into Mexico from a country that is not a free trade partner,a company pays customs duties for importing, but the Mexicangovernmentreturns the import duties if the Mexican firm exports the productto a free trade partner.State governments in Mexico offer varying incentives for industrialinvestment. In Guadalajara, in the Mexican state of Jalisco, whichis a center for the Mexican electronics industry, the state governmentpays for training of electronics employees for a period of time. Somestates provide land for building a factory. Others offer access torisk capital through development banks or tax incentives to helpestablishnew industrial plants.Despite the advantages of establishing a presence in Mexico,businessesneed to proceed carefully:Weigh Mexico’s economic conditions. Reviewing economicconditions is an important first step in deciding whether to importor invest. Gonzalez says that Mexico is now in a very good placeeconomically,”because we have had a democratic election, and the transitionteam has done a good job with the economic area.” He foreseesno economic problems and says that exports are growing. Talking aboutthe potential impact on Mexico of a slowing U.S. economy, he explainsthat Mexico’s free trade agreements release it from dependence onthe United States. “We are exporting and taking advantage of freetrade agreements to diversify,” says Gonzalez. “We are makingan effort not to be dependent on only one economy.”Hire an intermediary. Working with a local consultantto ease the way through the procedures required by the Mexicanbureaucracyis a good idea, though Gonzales says the Mexican government is tryingto expedite the business processes.Select a geographical area where your industry is alreadyconcentrated . Once it decides to invest in Mexico, a businessshouldlocate a new plant in an existing industrial center in order to takeadvantage of the existing network of suppliers and ensure that thearea has the necessary infrastructure for characteristic industrialprocesses. For example, for the textile and apparel sector, theremust be sufficient water available for getting the dye into thefabric.The states of Puebla and Tlaxcala offer plentiful water resourcesas well as networks of suppliers.Make use of the Internet. Use websites to gatherinformationabout municipalities (www.inegi.gob.mx), business enterprises(www.secofi-siem.gob.mx),the Economic Information Bank(www.dgcnesyp.inegi.gob.mx/bie.html-ssi),the competitiveness of each state (www.itesm.mx), manufacturing(www.canacintra.org.mx),and foreign investment guidelines and industrial costs(www.bancomext.com).Gonzalez earned his bachelor’s degree in international affairsat the National Autonomous University of Mexico. He has also studiedinternational finance, international negotiation, and economics. In1989 he joined the Foreign Trade Bank of Mexico, where he worked asassistant to the president of foreign trade promotion and helpeddesignstrategies to help Mexican exporters access different markets. Hewas appointed deputy trade commissioner of Mexico in New York in 1998and is currently responsible for attracting foreign investment intoMexico as well as overseeing the textile and apparel, leather, andpharmaceutical products sectors.Once a business establishes itself in Mexico, as in any foreigncountry,it will encounter cultural differences. Gonzalez tells of businesseslunches where representatives of different companies may spend twoto three hours negotiating in a restaurant. But long lunches may bea small price to pay to get a piece of New Jersey’s exports to Mexico,which in 1999 totaled $913 million.— Michele AlperinTop Of PageTransportation Summit: Trains, Planes, & CarsThe teleconference has become old-fashioned now thatthe virtual conference is a reality. For the first time in itshistory,the American Society for Public Administration is offering virtualattendance to its three-day 62nd National Conference, beginning onSaturday, March 10, at the Rutgers campus in Newark.”For those who want the knowledge, but not the travel,” theconference brochure states, “the 25 best papers presented willbe available on-line, as well as highlights of the main conferenceevents and any-time participation 24 hours a day for a two-week periodduring and after the conference.”The ability to tune in without traveling has its irony, for one ofthe key sessions of the Conference will have as its subject”TransportationPolicy and Administration in the New Century,” moderated byJeremyF. Plant, professor of Public Administration & Public Policy atPenn State in Harrisburg.”I’ll be kind of the swing man,” says Plant. “Three peopleare giving papers; I’m preparing a talk entitled `The big questionsof transportation policy’.”So what are those big questions? “One issue is that we are movingfrom a focus in transportation on building capacity to more of aperformanceorientation. Mobility is still the obvious performance criteria buteconomic efficiency and contributions to rational land use have becomereal considerations, rather than just counting up the number of roadswe build or rail lines or bridges we build. In that sense, thingsare going well. Economists who tally up the aggregate costs oftransportationas a cost item in the economy have said that costs are going downa little bit.”Plant also identifies other areas of discussion for the conference:What is the effectiveness of the trucking industry?”Thatleads to questions about competition, not just between modes oftransportation,but between different uses of the same mode, such as between truckersand commuters. The whole `just in time delivery angle’ of Americanindustry has changed trucking quite a bit. Lots of times they’recompetingfor space with commuters, because they have the same goal. It usedto be that the trucks could show up in the middle of the night andget out of everyone’s way. Now trucks are our moving warehouses, whichhas contributed to a lot of efficiency but has had secondary effects.”What is the railroad’s place in freight hauling? “I’ma railroad buff, but the railroads show an inability to change oldmanagement practices, and they just don’t seem to be doing as well.They had a great run in the early 1990s and everyone in the investmentworld thought it would continue to be strong. But the break-up ofConrail has led, at least in the east, to lower stock prices, andin turn, less capital to do things.”Really, truckers are the ones that can do everything now andthe railroads are going to be the specialists’ group; it’s theoppositeof the 1940s when the railroads were the prime haulers. If you lookat the configuration of the railroad industry, it clearly hasn’tshakenout yet. Everyone thought for a long time that eventually there wouldbe two competitive national rail systems but then, after NAFTA, theCanadian railroads became very active in North America. CanadianNationalhas particularly become a big player, and Canadian Pacific is thelargest rail user of Philadelphia.”Where is passenger service headed? “AMTRAK is onprobationright now. Clearly, we’re not going to abandon the Northeast corridor.If AMTRAK can’t make a go of it, someone else will. It’s verydifficultto see success except for a few corridors in passenger service. Idon’t know why. It’s not for lack of use. There have been a fewsuccessstories. The new corridor service to Boston is quite successful. Butpeople don’t seem to use railroads for long-haul passenger servicethe way they did in the ’30s and ’40s, what with airplanes and withinterstate highways.”What about air travel? “The whole question of airportexpansion, that’s another big area. If you look at improvement inthat area since 1960 in the United States, it’s pretty bad. We justhave not kept up. It raises issues of environment, land use, andqualityof life issues.”What can we do about highways in areas like the Princetoncorridor? “One question would be, is there a market for tollroads that would help pay for use in high growth areas? The issuethat has gotten the most attention in the last quarter century orso is somehow trying to figure out how we can make the suburbs morelivable — what will lead to reduced traffic congestion and greaterhighway safety. Every time you enhance capacity of transportation,you accelerate the process of suburbanization.”What about light rail? “People are certainly lookingat light rail as an alternative. We went from the late ’20s to theearly ’60s without building any significant urban rail system. Sincethen, we’ve seen a resurrection of light rail. They are easy to buildefficiently, often on an existing right of way, and require much lessequipment than heavy rail systems. Pittsburgh hopes to fund a trialrail using the magnetic levitation system.”Is there a transportation system model that we in theUnitedStates should be looking at? “A lot of people are looking moreat Europe, and the developed areas of the Far East to see what hasworked there that we could incorporate. The general affluence ofpostwarEurope, and their concern with making livable communities and smalldistances has led to a lot of innovation. Germany has exploreddedicatedbike and pedestrian paths in trying to make urban areas almostauto-free.Of course, it’s hard to see that working in Philadelphia…We ‘restill stuck with the car.”Any predictions for the future? “I think we will seesome political changes. The last Federal surface transportation bill(the 1998 Transportation Efficiency Act for the 21st Century) wasone of the great last true pork barrel bills, very heavilyCongressionallydirected by Pennsylvania congressman Bud Shuster, chairman of theTransportation and Infrastructure committee.” (The Almanac ofAmerican Politics 2000 notes: “Members who went along with himgot $15 million in projects for their districts, more in the caseof committee members; those who didn’t go along got little ornothing.”)Continues Plant: “You are going to see public policy focus onhow states can work with metropolitan planning organizations to bringtransportation more and more into environmental and land use typeof issues. I’m somewhat optimistic that we can move fairly rationallytowards seeing that transportation is a means, not an end withinitself.But it’s not going to be easy. The arithmetic is simple: we’re notbuilding roads any more and yet every year we have far more carsregisteredand significant increase in truck traffic. People commute longerdistances,the population is increasing. Something has to give.”— David McDonoughNext StoryCorrections or additions?This page is published by PrincetonInfo.com— the web site for U.S. 1 Newspaper in Princeton, New Jersey.
