Month: April 2019

Professor Shares Out-of-This-World Advice for Leadership

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Neal Outland
Neal Outland, a DePaul management and entrepreneurship faculty member. | Photo by Kathy Hillegonds

Like NASA, the business world operates in team-based environments. Whether these business-team environments are competitive, volatile or uncertain, they share many similarities with space crews.”

Captain Kirk of the Starship Enterprise was mostly a good leader, according to Neal Outland, a DePaul management and entrepreneurship faculty member who has researched the leadership qualities of real-life astronauts. While not a Trekkie himself, Outland says from what he has seen on the television show, Captain Kirk exemplifies traits shared by successful leaders. Kirk understood the strengths of his crew members (e.g., Scottie in engineering, Dr. Spock in science) and how their expertise could help the team succeed, although the captain occasionally put his team in danger because of his own brashness.

Outland, the winner of a 2017 Illinois Space Grant Fellowship, has worked on two NASA-funded studies with DePaul faculty to understand the individual qualities needed by future astronauts. His current research focuses on the organizational effectiveness of workplace teams and is inspired by his exploration of how astronaut teams develop shared understanding.

“Even though NASA teams operate in some of the most solitary, stressful and extremely dangerous environments, like outer space, the NASA research relates to the business world in many ways,” says Outland. “Like  NASA, the business world operates in team-based environments. Whether these business-team environments are competitive, volatile or uncertain, they share many similarities with space crews.”

These similarities involve having strong leadership roles, defined task structures and team self-management, he says. NASA and business teams also face communication issues (or, in space, a lack of immediate communication) that force leaders to make important decisions affecting the group’s success. Based on his research, Outland identifies the following qualities and tips that can help any type of leader and team blast off.

Qualities of Good Leaders

  • Self-management. This is the No. 1 quality of a good leader, according to Outland, because it’s difficult to lead or inspire others if you cannot lead yourself. His advice: think critically about yourself and your actions to understand your strengths and weaknesses.
  • Ability to share the vision. Good leaders task people with assembling smaller pieces of the puzzle while motivating them to see their part in completing the full picture.
  • Intelligence. Higher intelligence generally affords a leader the ability to make sense of situations and quickly process large amounts of information associated with a particular decision. Leaders must have a deep understanding of decision outcomes and how they contribute to achieving the vision. Leaders also are continuous learners, taking time to develop their skills and remain up to date on best practices.
  • Excellent soft skills. Leaders don’t do all the work themselves; they get work done through others by communicating their vision and motivating individuals to work together to achieve it. Effective communication skills, tailoring interactions to the individual and managing relationships well are essential for leaders.

Assembling an Effective Team

Team success depends upon how and why the team was formed, Outland says. Based on his research, factors that are important for forming teams include:

  • Understanding the context of the team’s work. The amount of work a team may have to do, the complexity of that work and how often the work situation may change are important factors to consider when forming teams.
  • Selecting people who will fit well together and in the work context. Choose people who can handle the work and effectively interact with others.
  • Creating a supportive environment. Teams need coaching to uncover effective and ineffective patterns of interaction. Leaders need to facilitate discussions about conflicts that may diminish team effectiveness, as well as ensure that teams have all the resources necessary to accomplish their work.

Getting Past the “Third Quarter Phenomenon”

In their NASA research, Outland and his colleagues noticed a pattern affecting some missions in which team performance started to decline once the mission passed the halfway mark. Performance lagged when team members knew they would soon be free from the close quarters and crew members they had been interacting with for months. This change in team behavior is called “third quarter phenomenon.” For teams in the business world, third quarter phenomenon can go in either direction— triggering a slowdown or a flurry of positive activity.

Whether you are flying to the moon or managing a terrestrial work project, Outland’s advice for managing third quarter phenomenon includes:

  • Ensure that your team knows success is an option. Teams and individuals need to know that what they are working for is worthwhile. When feeling down, many will look for reasons to not continue, especially if they believe success won’t happen. The leader’s job is to ensure that the team knows that success is still an option.
  • Reinstill the vision. Reconnect the team to the ultimate goal of the project. Replay the motivations that sold the project or task to the team in the first place.
  • Boost confidence. Remind team members of previous successes, lessons learned and progress toward the ultimate goal. This is important, Outland believes, because it is rare for anyone or any team to do this reflection on their own.

By following this guidance, teams have an opportunity to boldly go where no one has gone before.

By Andrew Zamorski

Faculty Books Offer Tips for Building Relationships and Service-Oriented Work Cultures

jlansber Scholarly Pursuits

The Relationship Diet book cover and author Jim MoureyThe Relationship Diet: How to Create Happy, Healthy, and Valuable Relationships (At Home, At Work, and Everywhere You Go)

By James A. Mourey, assistant professor of marketing
(James A. Mourey, 2018)

Synopsis:

Mourey combines 50 years’ worth of social psychology research with more than a decade of corporate consulting experience “to provide a novel relationship framework that will change the way you think about and engage in relationships with others.”

Three Takeaways

  1. The same variables predict all healthy, successful relationships, whether they are professional, romantic or friendly.
  2. Successful relationships depend on four core “flavors”: direct communication, interdependence, enduring commitment and trust. Fifteen “ingredients,” including amiability, confidence, honesty and openness, build these relationship flavors.
  3. The word “diet” in the book’s title comes from the Greek word diaita, meaning “a way of life.” Your way of life, including your career, can be improved significantly by building relationship skills, Mourey writes.

“The Relationship Diet includes a diagnostic tool, sort of a ‘strengths finder for relationships,’ that reveals your relationship-building strengths and weaknesses, so you know what to leverage and what to improve,” Mourey says. “It provides a useful way for managers to create high-functioning teams based on knowledge about how team members are likely to relate and where teams are most likely to have relationship problems.”

By Robin Florzak

Dan Sachs and The Million Dollar Greeting: Today's Best Practices for Profit, Customer Retention, and a Happy Workplace

The Million Dollar Greeting: Today’s Best Practices for Profit, Customer Retention, and a Happy Workplace

By Dan Sachs, instructor, School of Hospitality Leadership
(Apollo Publishers, 2018)

Synopsis

Sachs travels across the United States and Canada interviewing leaders of consistently profitable large and small companies who tie their success to exceptional customer service and employees who rank their organizations among the top places to work in North America.

Three Takeaways

  1. Creating a great customer service culture begins with your employees—be accountable and authentic with them. It goes a long way toward building a team that prioritizes the customer experience.
  2. Great service experiences start with empathy and the ability to put ourselves in another’s shoes and then act on this understanding to change somebody’s day.
  3. Exceptional leaders understand that having a vision is not enough. Leadership requires turning a vision into a culture that engages both the employees and the community.

“When I started teaching at DePaul, I couldn’t find a book that integrated a philosophy focused on hospitality as a tool to create great customer service experiences, so I decided to write it myself,” Sachs says. “Products and processes can be duplicated, but the way you treat people, the type of culture you create and the values you champion are unique. Building a business that lasts is all about creating emotional connections with customers through hospitality.”

By Andrew Zamorski

What Will Be Your Legacy?

jlansber Giving Back
Susan Coe Heitsch
Susan Coe Heitsch (Photo by Kathy Hillegonds)

 

Susan Coe Heitsch (BUS ’80) learned a few life lessons during the seven years she worked in the trust marketing group at a major financial institution.

“If you don’t have a will, the state determines how your property will be distributed—and it’s not necessarily what you’d have chosen,” says Heitsch, a communications executive in the financial industry. “And if you do have a will, you really should update it every five years because I guarantee that something in your life has changed.”

While discussing their future, Heitsch and her husband, Gary, decided to incorporate philanthropy into their plans by making a substantial planned gift to benefit future marketing students at DePaul.

“If you went to college in the ’80s or ’90s, now is the time to think about the legacy you’re going to leave,” Heitsch says. “If DePaul helped to get you where you are today, maybe there’s a way you want to give back.”

Heitsch has been giving back ever since she graduated. She was active in Delta Mu Delta, the business honor society, as a student. After graduation, she organized the society’s annual membership drive and induction ceremony for several years until her daughter was born.

In 2009, Sue Fogel, then chair of the Department of Marketing, invited her to be an inaugural member of DePaul’s Marketing Advisory Council. Heitsch accepted.

“I did so because DePaul was like family to me, very encouraging and very nurturing,” says Heitsch. “Even as an evening student, my professors were accessible and truly cared about their students. I got to know several of my teachers and maintained contact with them over the years.”

“Serving on a council is another good way to give back to the university while making some great connections,” Heitsch says. “To network with people online is one thing. To spend two or three hours with them several times a year, brainstorming ideas and making them come to life, is a far more meaningful way to connect.”

Learn more how you can making a lasting impact at DePaul.

Richard H. Driehaus Honored as an Influential Leader

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Richard H Driehaus
Richard H. Driehaus

Richard H. Driehaus (BUS ’65, MBA ’70, DHL ’02) is among 33 business school graduates worldwide named to the 2019 Class of Influential Leaders by the Association to Advance Collegiate Schools of Business (AACSB), the international business school accreditation organization.

Each honoree was chosen for being a “shining example of how AACSB accredited business schools prepare their graduates to create lasting impact in their communities, industries and around the world,” AACSB says on its Influential Leader website, which features profiles of the leaders. Driehaus, founder of Driehaus Capital Management and a philanthropist, was praised for his role as a momentum investing pioneer, his generosity to DePaul’s business college and his philanthropy benefiting arts, culture and economic empowerment programs, primarily in Chicago.

“AACSB’s honor is a tribute to Richard Driehaus’ transformational role as a finance industry visionary and generous benefactor for our business college and community,” says Misty Johanson, dean of the Driehaus College of Business. “We’re proud that Richard is a Triple Demon alumnus of our college.”

Read more about Driehaus and the 2019 Class of Influential Leaders at aacsb.edu/influential-leaders.

Housing Boom or Bubble Ahead? Renowned Real Estate Scholar James Shilling Weighs In

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James D. Shilling, the George L. Ruff Endowed Chair in Real Estate Studies at DePaul University,
James D. Shilling, the George L. Ruff Endowed Chair in Real Estate Studies at DePaul University,

A decade has passed since a massive U.S. housing bubble triggered the 2008 financial crisis. Could another housing bubble be brewing?

We asked James D. Shilling, the George L. Ruff Endowed Chair in Real Estate Studies at DePaul University, who researches housing and real estate investment trends. A prolific scholar and sought-after speaker at academic and business conferences around the world, Shilling recently discussed the prospect of another housing bubble at the World Knowledge Forum in Seoul, South Korea. Here, he discusses his findings and gives his take on other real estate trends.

What trends are affecting the current housing market?

Global economic growth slowed in late 2018 and early 2019. One factor negatively affecting global growth has been the down cycle in technology (for example, a low demand for iPhones). Another factor has been the slowdown in credit in China and the trade conflicts with the United States. Europe—and, more specifically, Germany, the world’s leading exporter by most measures—has also been affected by trade tensions. There also is uncertainty over politics in Europe (for example, Brexit). Finally, that growth in the United States slowed is no surprise. The U.S. grew quite quickly in the first half of 2018 on the back of a large fiscal stimulus, and the effects of that stimulus are starting to wear off.

These factors generally caused most housing markets worldwide to cool in late 2018 and early 2019. Nevertheless, lower 30-year fixed-rate mortgage rates in the U.S. (which have recently dropped to 4.2%, a drop of more than 0.75% since late 2018) are likely to lure many buyers back into housing markets in the U.S. for the remainder of the year.

Are we due for another housing bubble?

If you look at what happened during the last crisis, housing prices in real terms increased about 70 percent from 2002 to 2008. Then they fell by 30 percent from about 2008 to 2011. If you apply that same criteria to housing prices today, Beijing, Shanghai, Hong Kong and San Francisco all meet that criteria for a bubble—real housing prices have grown by more than 70 percent in those markets since 2008. And markets on the brink include London, Los Angeles, Zurich and Boston. Interestingly enough, however, Chicago and New York City have been laggards in terms of real housing prices. In New York City, the high end of the market has really declined significantly over the last 12 to 18 months.

So, the data presents a picture that in some places prices are going through the roof, other places are on the brink, and in still other places, such as Chicago, we aren’t seeing that big an increase. The short answer is that it doesn’t look like a bubble will cause a crisis because housing prices are not affecting all places in the same way.

On top of that, in order to have a bubble, there also needs to be some sort of speculation taking place. If you go back 2002-2008, we saw a lot of people doing that. People bought homes and they didn’t do anything with them – they just kept them vacant and then tried to flip them. We saw that in Chicago and almost everywhere. But the only place where you are seeing that now is in Asia. In places like South Korea, about 20 percent of households are looking to flip.

We’re also seeing very little new housing starts (new residential construction projects) and existing home sales here in the Midwest as well as the East and West coasts. People have low interest rates. Four or five years ago the rates were 2.75 to 3%, and now it’s about 5%. So people are thinking about whether they want to give up their favorable financing to take on something new. We’re starting to see more improvements to existing homes instead.

What other factors make the current housing market different?

While many families were struggling to make their mortgage payments just before the Great Recession, debt to income levels and delinquency rates are currently much lower than they were prior to the bust. Households are holding significantly less mortgage debt and are making their monthly mortgage payments at a much higher rate than during the Great Recession.

Why are housing prices at bubble level in some cities but not in others, like Chicago?

I think the answer involves economics in general and where the shared economy and technology impact the economy. If you look at places like San Francisco, which is driven by technology, for people in the top 10 to 20th percentile, the ratio of housing prices to incomes is about 2 to 2.5 times. For that segment of the population, the prices are pretty reasonable. For everybody else, it’s hugely unaffordable. Then you look at Chicago. We haven’t benefited as much as San Francisco in the technology-driven economy, and so we won’t necessarily expect to see the huge prices we’ve seen in places like San Francisco, Boston and Austin, or in Hong Kong, Beijing and Shanghai.

The issue of housing affordability speaks to the work of the Institute for Housing Studies​ at DePaul. As much as we thought affordable housing was an issue in the 2000s, going forward it’s going to be doubly important because income inequality is not going away. It’s tough to put technology back in the bottle and reverse these trends.

How might things have changed in Chicago if the city had been chosen for Amazon’s second headquarters?

Having Amazon located in the city would have been both a blessing and a curse. The blessing is that it would have created a ton of jobs in Chicago. The curse is that it would have moved us to become more like San Francisco – higher prices on housing overall because the incoming workforce would have lowered supply and raised housing prices.

Read the latest report from the Institute for Housing Studies on the State of Rental Housing

By Robin Florzak

Leaders of Today: Bringing Immediate Value to Campus, Business and our Community

jlansber Features

Business Exchange cover photo
Student leaders creating a positive impact: Rebecca Mitrea, Kevin Felisme, Olena Cruz and Bevon Joseph, with Business Dean Misty Johanson (photo by Kathy Hillegonds)

Whether they are millennials or members of Generation Z, DePaul business students and recent graduates were born to lead.

Ninety-one percent of millennials aspire to be leaders, the Millennial Leadership Study survey conducted by WorkplaceTrends.com found, and nearly half of those surveyed define leadership as “empowering others to succeed.” Meanwhile, according to Forbes magazine, surveys of Gen Z (those born after 1995) show that this latest generation to hit campus wants to “make their mark, in part, by making our society better than past generations have managed to do.”

Grounded in Vincentian values, DePaul provides opportunities for students to exercise their interest in socially responsible leadership from the minute they come onto campus as first-year students. Campus-wide initiatives like New Student Service Day and the annual Vincentian Service Day, and projects led by the Steans Center and Campus Ministry, allow students to become change-makers in the Chicago community DePaul calls home. In 2018 alone, DePaul students completed hundreds of thousands of community service hours.

At the Driehaus College of Business, students develop their leadership talent through classroom lessons, experiential learning, student organizations, mentorships, internships and even their own businesses ventures founded with the help of the Coleman Entrepreneurship Center and other resources. These opportunities produce young leaders who get to work immediately at solving marketplace and societal problems, inspiring peers to reach new, heights and pushing the boundaries of achievement on campus, in business, in sports and in the community.

In the following stories we highlight four soon-to-be and recent DePaul business graduates who are pursuing different paths but have one thing in common:  they use their business acumen to lead and empower others.