In an increasingly global economy, international experience for Indiana University MBA candidates comes from hands-on work in the field as much as the classroom. A group of students, led by Dr. Phil Powell, travel to Peru to help local entrepreneurs tackle business challenges using cutting edge business practices. The Kelley MBA GLOBASE initiative provides a unique social enterprise experience by partnering with Peruvian businesses to make a global impact.

Wednesday, March 23, 2011

Paprika and Piscos

Reflecting back on or time in Peru, it is difficult for Team Dirose to have envisioned a better project or better people to work with. Diego and Miguel's invention, multiple robotic arms for paprika pepper picking, could potentially revolutionize the way peppers are harvested throughout the world. We are fortunate to have had the opportunity to offer guidance for this project through presentation recommendations to financial institutions and potential customers, building financial models, and outlining overall strategic focus for the company. Perhaps the best experience we had working with Dirose was the relationship-building process. Latin culture is very much relationship-based, and much of our best progress on the project was made during lunch at Diego and Miguel's parents' house or over several Pisco Sours (the traditional Peruvian drink) in the evening. It truly was an invaluable international business experience.

The trip wasn't without its exciting expeditions in Peru though! Some of the adventures of Team Dirose members included surfing in the Pacific Ocean, paragliding in the mountains, four-wheeling in the Andes, and trekking through the lush national park of Paracas. Naturally, the highlight was our trip to Machu Picchu, where we explored the ancient city for an entire afternoon.

Thursday, March 10, 2011

A pleasurable stench of "hands on" education

Unique to the GLOBASE experience is "hands on" learning about your client's product and operations. Pictured above is one team's experience at a fish processing site. Their client, Gervasi, purchases seafood from fisherman at the dock, outsources the processing of it at the site, and sells final product throughout Peru. The team must identify a "go to market" plan for Gervasi's entry into the U.S. frozen fish market. This includes recommendation of local U.S. markets to target, vetting of cold storage sites, and forecast of product profitability based on U.S. prices.

To understand the business, the team toured a processing site to understand the different fish that Gervasi sells and the chain of production from fisherman's boat to final packaging. While a great time was had, the most memorable moment occurred in the Casa Andina lobby after hotel staff asked team members to hurry to their rooms and shower. Arrival of our esteemed Kelley MBA team was evidently not kind to their olfactory senses.

Another team works for client Selva de Oro. The company wants to export bamboo to the United States. During their research in Bloomington, the team determined that no market exists in the U.S. for Selva de Oro's bamboo. There task while in country is to determine a market for the bamboo internal to Peru - the hypothesis is furniture. The team's "hands on" research included a trip to the Bamboo Society and a tour of a furniture assembly facility. The team's six hour lunch with their client one day was a fun immersion in Latin business culture.

Wednesday, March 9, 2011

From Production to the Pier: Monday March 7, 2011

From the buckled highway roads going out of downtown Lima, Jose explained to us some of the unique sights demonstrating Peru’s economic takeoff. Pueblos jovenes, literally “young towns” where rural Peruvians immigrated to be closer to the city and employment, popped up from the dusty hills. On the left, hundreds of trees dotted the arid landscape as part of an environmental program to slow erosion and create more fertile soil.

Adam, Nathan and Mark get a tour of the Keyfarm facility

Jose was very excited to show Team Keyfarm his production facility on the outskirts of Lima. Jose and his production manager Guillermo gave us a thorough tour of the facility where they make high quality generic pharmaceuticals for sale in Peruvian parafarmacias. We put on hardhats, rolled up our sleeves and witnessed the entire process: raw materials, testing and quality control, mixing, coating, packaging, and printing. Jose is very proud of his production facility, and he has every reason to be.

After our tour, Jose wanted to show us some of the best cerviche in town. The restaurant was located on the shore of the Pacific Ocean in the Barranco neighborhood and offered picturesque views of Miraflores. Cerviche is raw fish bathed in a citrus-based marinade, thinly sliced onions, salt and pepper. I have never had fresher fish than in Peru. The tender white and pink meat was plucked from the Pacific just a few hours earlier. Peruvians also take a lot of pride in this dish – they claim to have invented it 500 years ago.

Delicious cerviche and other Peruvian specialties

Our day closed on the pier, overlooking the beautiful stone beaches of Miraflores. Team Keyfarm has been blown away by our host’s hospitality and willingness to share Peruvian culture. We are working hard to repay him by presenting actionable, value-adding recommendations on Friday.

Tuesday, March 8, 2011

Checking in on 2010's Recommendations

One of the downsides of MBA projects is that one rarely gets to see the outcome of a recommendation. For example, I've had the opportunity to compete in many case competitions, where the "recommendations" are merely academic exercises and will never come to fruition. I've also had internships in which I made strategic recommendations that would be implemented so far down the road it was hard to tell what affect they would have.

As a member of 2010 GLOBASE Peru, my team worked with a metal fabricator in Lima, focusing on many sectors - education, health care, mining etc. The experience was fantastic, but as the team left we wondered if any of the recommendations we made would ever be implemented and if so what impact they would have - be it positive or negative.

As a member of 2011 GLOBASE Peru, I was fortunate enough to have these questions answered. My team is working with the same client we worked with last year and yesterday, on our first full day in Lima, we were able to visit his factory, which was bustling. As we toured his offices we noticed some new faces. Our client had implemented our recommendations from 2010; to focus efforts on the mining sector, and hire a sales person to solely focus efforts on this sector. In fact, our client had hired not one, but two sales people.

These new hires and renewed focus on mining have resulted in many new sales, which have necessitated hiring more factory workers. It became very evident that last year's GLOBASE efforts had in fact met the mission of GLOBASE - Global Business through Social Enterprise.

By helping the President of a company align his strategic efforts we were able to assist in an increase in sales which in turn resulted in job creation. It was a great feeling to see our work pay off for so many people, and gave me renewed confidence in our efforts this year. I have no doubt that all of the 2011 GLOBASE teams will find an equal amount of success with their projects this year.

Touring the lab and selling to Mexico's former health minister

The intersection of GLOBASE and personal transformation promised by the MBA journey is receptivity to what the experience brings you. In graduate management education, we faculty link high productivity to meticulous deciphering, forecasting, planning, and implementation – in other words, we teach managers to control their environment.

Innovation and creativity, though, occur when a manager allows the environment to deliver new observations, adaptations, and solutions to her mind in an unforced way. Generating value for a family-owned business in an emerging market like Peru with an unfamiliar language and unfamiliar culture disciplines the minds of our MBAs to balance revelation with control. My hope is that everyone leaves Peru a bit different than when they arrived and that a piece of Lima goes with them into their internship and career. This mental export is the ultimate value of GLOBASE.

Yesterday, our generic pharmaceutical team toured the site of their client Keyfarm. By Friday, they must recommend a plan on how to make unused production capacity profitable, either through development of an internal growth strategy or to contract as a supplier for a larger pharmaceutical partner.

Last night, the management team of technology client Dirose met with the former health minister of Mexico to explore sources of financial capital. Dirose used information it had already received from the MBA team to sell its business model. The MBA team will use insights from this meeting to generate final suggestions for Dirose’s commercialization of its harvesting technology. Now that’s real time consulting!

On this Tuesday morning, most teams are in the hotel refining their ideas and analysis based on insights gained from their client orientation yesterday. They will reconvene with their clients for a long Peruvian lunch to move projects along.

It is another enjoyable, productive, and warm day in Lima for the Kelley School in Peru!

Monday, March 7, 2011

Off to the office this Monday - in Lima, Peru

The GLOBASE Peru teams got down to business at 9am this morning (or a little later than scheduled - to match business norms in Latin America) with a welcome breakfast at the hotel with the clients this morning. Teams have personally worked with the clients since January when they visited Bloomington to kickoff the projects. After breakfast, teams headed off "to the office" to start their week of consulting work and site visits. Teams completed about 70% of their project work before arriving with coaching and support from the student leadership team, Ana, and me. The remaining 30% requires data collection and observations only gained on the ground in Lima.

The student leadership team identified clients working through the American Chamber of Commerce in Peru, our GLOBASE partner in Lima. All six clients are family-owned businesses that are active in the local market. They are a fish processing operation, a food distributor (basic agricultural products), a bamboo company, a furniture manufacturing business, a producer of generic pharmaceutical products, and a startup seeking to commercialize technology for automated picking of papricka peppers.

In concert with the rest of Peru, Sunday was a day of rest and relaxation for everyone. Students napped, familiarized themselves with Miraflores (our part of town) through long walks, and tasted the gastronomically-pleasing local dishes (especially cerviche). We start the work week well-rested and ready to add value in classic Kelley MBA fashion.

Sunday, March 6, 2011

Takeoff of GLOBASE Peru 2011

Asleep at 2:30 after arrival in Lima, up at 7:00 – I don’t want to miss this morning’s run.

I come out of the Hotel Casa Andina, respectfully pass congregants attending 7:30 mass at the Church de Nuestra SeƱora Fatima, and then run along the cliff above the sea past Larcomar, El Parque de Amor (the Park of Love – where couples come to kiss and celebrate their adoration), and finally turn around at a miniature lighthouse that honors the Peruvian navy.

Seeing this vibrant, entrepreneurial city come to life each morning always inspires me. Plus, the cooler breeze off the ocean makes a jog more tolerable before it hits the upper 20s (centigrade).

Today is takeoff for GLOBASE Peru 2011 and I am very excited. Our great student leadership team (Rocio, Sen, Caroline, and Matt) brings us together at 11:30am downstairs in the hotel to get us underway.

As we begin, I remember two thoughts that struck me on the plane last night.

In a Delta promotional video, a pilot observed that if he turns his plane into the wind blowing against him, the plane flies higher and faster. Our GLOBASE teams have worked hard before they arrived in Lima – some hit major snags in identifying how to add value for their clients. They, however, faced their challenge head on and are ready to soar. Their "flight" during the next week in Lima will be a memorable part of their MBA experience.

On my Delta headphones, Kenny Chesney sang the lyric "live a little, love a lot". Last year, a Peruvian economist boasted proudly to me that Peruvians enjoy life more than Americans because in Peru, they "work to live" not "live to work". GLOBASE Peru exposes us to successful small companies that don’t require managers to be addicted to their vocation 24/7. For our students, I hope this broadens their perspective on "work life" balance and the long-term productivity it creates.