Research@Smith
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2
Corporate
Governance
Aligning pay with
performance
4
Operations
Saving millions for
satellite providers
6
Finance
Predicting merger success
S
mith School faculty pursue world-class, gamechanging research. But we are also aware that there
is a wealth of knowledge and insight close at hand—in
the heads of business practitioners, who have front-line
experience with the kinds of urgent, complex issues we
Dean’s
column
Research@Smith
VOL
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most want to address.
We are committed to engaging with the corporate
community in a variety of ways for the mutual benefit
of both companies and our students and faculty.
Interactions between Smith students, faculty and
business professionals enriches Smith’s curriculum
and classroom activities, and ensures that the school’s
educational and research focus is always relevant.
That is why I am excited to announce the launch of our
Research@Smith summarizes research conducted by
the faculty of the Robert H. Smith School of Business
at the University of Maryland.
new Corporate Partners Program, to provide a venue
for productive exchange and collaboration between the
corporate world and the Smith School. Through it, we
give companies access to world-renowned researchers
Dean
and talented future employees. Corporate partners have
G. Anandalingam
opportunities to participate in professional development,
sponsored research and events, employee recruitment
ASSOCIATE DEAN OF FACULTY & Research
and other individualized strategic investments, with the
Michael Ball
goal of bringing industry into full partnership with the
Editor
Rebecca Winner
Smith School.
The Corporate Partners program is a great way to
Contributing Writers
connect with the entire Smith School community and
Carrie Handwerker
complement any existing relationships you may already
Jessica Bauer
have with faculty or centers. Tim Dennis, our director
of corporate relations, will work with you to develop a
Design
customized action plan to match your company’s needs
Lori Newman
and interests to the extraordinary faculty and resources
available at Smith.
Research@Smith is published three times a year
by the Robert H. Smith School of Business,
I hope you will connect directly with me or with Tim,
University of Maryland; 3570 Van Munching Hall,
tdennis@rhsmith.umd.edu, to learn more about how we
College Park, MD 20742. www.rhsmith.umd.edu
can work together.
We’d like to put Research@Smith directly into the
hands of academics, executives, policy makers, and
others who are interested in learning about the latest
research conducted by Smith School faculty. To
G. “Anand” Anandalingam
request a copy of this publication or make an address
Dean, Robert H. Smith School of Business
correction, contact Rebecca Winner via e-mail,
University of Maryland
editor@rhsmith.umd.edu, or phone, 301.405.9465.
Visit the Smith Research Network:
www.rhsmith.umd.edu/smithresearch
Research@Smith
FALL 2010
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Text-Based Analysis of Mergers and Acquisitions
page 2
Research by Gerard Hoberg and Gordon Phillips
A new vocabulary-based measurement of firm similarity shows which
mergers are most likely to succeed.
The Cleansing Power of Equity
page 4
Research by Leigh Anenson
A long-standing equitable doctrine called “clean hands” can help boards
better align pay with performance.
Multi-Period Routing in Satellite Networks
page 6
Research by Raghu Raghavan
A new mathematical method can save millions for satellite service providers.
Center for Social Value Creation
page 8
Teaching students to create value for themselves, their companies and the world.
Leadership and Creativity
New Smith Faculty
page 10
Featured Researchers
ThoughtLeadership@Smith Speaker Series
CEO@Smith Speaker Series
page 11
CEO Profile: Rocky Cintron, CEO of Force 3
page 12
Text-based analysis
of
mergers and
A new vocabulary-based measurement
of firm similarity shows which mergers
are most likely to succeed.
acquisitions
S
ome mergers work better than others, and
the question of why has been the subject of intense
and so we know the degree of relatedness as well as
the direction,” says Hoberg.
interest to researchers. Are similar firms better merger
candidates? Gerard Hoberg, assistant professor
With this data, Hoberg and Phillips analyzed how
of finance, and Gordon Phillips, Bank of America
similarity and competition affect mergers. Existing
Professor of Finance, recently developed much
studies of merger pairs measure similarity by asking
richer data to understand firm relatedness and more
if both firms reside within the standard industrial
accurately predict merger success or failure.
classification (SIC) codes used in company filings to
the SEC. Hoberg and Phillips find that most merger
Financial research has historically focused on the
pairs are far more similar than other methods of
numbers in company filings—the accounting
classification would suggest. Even merger pairs with
statements. But the words which compose the vast
different SIC codes generally had a high degree of
bulk of those documents have been virtually ignored.
similarity with each other.
Hoberg and Phillips used Web-crawling techniques
to examine the vocabulary in the filings of all publicly
One of the benefits of the model is its ability to show
traded companies over a 10-year period—more than
the similarity between firms not in the same industry.
50,000 filings—through the Securities and Exchange
The authors cite a merger between Antheon, a firm
Commission’s Electronic Data Gathering, Analysis, and
that produces military intelligence technologies, and
Retrieval system (EDGAR).
General Dynamics, which is a traditional military firm
that makes ships and tanks. Past ways of measuring
Hoberg and Phillips represent this information in a
similarity would have labeled this merger pair as
3-D format that looks like a globe. Every product
dissimilar because their SIC codes are different. But
developed by every firm that filed 10Ks through
the similarity that drove this successful merger was
EDGAR is represented at a point on that globe—with
the fact that both firms work with the military.
congested clusters at points where many products
2
exist, and empty places where no products exist. This
It is new products that generate the profits in such
geometric representation of the product space allows
mergers. What is the new product here? “Probably
researchers to measure the degree to which firms are
classified,” says Hoberg. “But I can guess that if you
related in a much more precise manner. “What we
had access to real-time intelligence and you could link
have that other metrics for relatedness don’t, is that
it into the technology aboard military equipment, the
we know where every firm is in a well defined space,
military could have a much better, quicker response
FALL 2010 : VOLUME 11 : NUMBER 2
Research by
and
Gordon Phillips
Gerard Hoberg
(right)
to crises. Now General Dynamics can sell the
Most merger pairs are far more similar than
military a more integrated product that would have
other methods of classification would suggest.
more value.”
Hoberg and Phillips found that firms were more likely
Even merger pairs with different SIC codes
generally had a high degree of similarity with
to merge with partners whose language describing
each other.
their assets was similar. These mergers were more
flows and new products that will benefit firms and
likely to result in increased stock returns, longer-term
their shareholders.”
gains in cash flow and higher growth in their
product descriptions—evidence of new products
Hoberg and Phillips re-draw their Variable Industry
being offered.
Classification sphere every year. That enables them to
see the product space evolving as companies merge
Mergers were most successful, and resulted in
and new products are created.
improved profit margins, when a firm merged with a
target that was similar to itself, but different enough
“Product Market Synergies and Competition in
from its rivals to differentiate its product offerings.
Mergers and Acquisitions: A Text Based Analysis”
Firms with a higher potential for unique products, as
is forthcoming from the Review of Financial Studies.
captured by patents, copyrights and trademarks, are
For more information about this research, contact
more likely to be involved in acquisitions.
ghoberg@rhsmith.umd.edu or
gphillips@rhsmith.umd.edu.
Phillips sums up the research, saying, “Managers
frequently cite synergies for a motivation for mergers.
However existing research has not been able to find
existence or benefits of synergies. Our research shows
that many related mergers do produce increased cash
RESEARCH@SMITH
3
The
cleansing
power of
A long-standing equitable doctrine called
“clean hands” can help boards better align
pay with performance.
W
hen AIG executives received their annual
equity
politically and economically powerful. The equitable
bonuses even after the struggling firm took
defense of “clean hands” protected courts from those
$700 million in federal bailout funds, a storm of
seeking to profit by their own wrong-doing. Conduct
public criticism erupted. AIG justified its decision
did not have to be illegal for courts to consider the
to pay the bonuses by claiming it was contractually
defense. Behavior that did not conform to minimum
obliged to do so.
ethical standards in business would suffice.
New research from Leigh Anenson, associate
Anenson’s research demonstrates the continuing value
professor of business law, with co-author Donald
of equity and ethics in corporate law and governance.
Mayer, University of Denver, says that corporate
Where the hunt for bonuses encourages excessive
boards already have the tools they need to stop such
risk-taking, the doctrine of “clean hands” empowers
payments. Under a long-standing equitable doctrine
boards to take defensive and remedial action.
known as “clean hands,” directors can refuse to
“Corporate boards often consider financial equity as a
reward an executive who asks for contractually agreed
means of raising capital for the good of the firm. But
compensation after risking the company’s future for
in the ongoing financial crisis, raising legal equity may
present personal gain. In assessing the efficacy of the
be their best strategy,” says Anenson.
“clean hands” defense in the executive pay context,
their research integrates and extends research in the
If directors think in terms of “clean hands” rather
fields of business, ethics and law.
than contractual compliance, they could withhold
excessive bonuses, severance packages and other
“Our analysis suggests that the use of the ‘clean
payments. Boards could also seek to rescind payments
hands’ doctrine to check compensation abuses is a
that have already been made. This doctrine gives
legitimate and effective role for courts in the reform
directors the right to question out-sized pay and use
process,” says Anenson. “Ultimately, it fortifies the
courts rather than the typical situation of directors
legal arsenal of the board in combating excessive
being questioned in court by shareholders.
executive pay, to provide greater protection to the
company and guarantee fairness to shareholders
The application of unclean hands in cases of excessive
and other stakeholders.”
compensation, Anenson says, supplements and
supports federal legislation regulating executive
4
Centuries ago in England, the idea of equity arose
compensation in public companies. The Dodd-
to prevent abuse of the law and legal process by the
Frank Wall Street Reform and Consumer Protection
FALL 2010 : VOLUME 11 : NUMBER 2
Research by
Leigh Anenson
Act of 2010 mandates compensation committee
Corporate boards often consider financial equity
independence, shareholder “say on pay,” and
as a means of raising capital for the good of the
compensation clawbacks. Ensuring that independent
directors negotiate executive employment contracts
and giving shareholders a nonbinding vote on their
firm. But in the ongoing financial crisis, raising
legal equity may be their best strategy.
corporation’s executive pay plan generally occurs ex
Like shareholder advisory votes on pay, many
ante to the contract, Anenson comments, whereas
companies have clawback policies, some of which are
unclean hands operates to protect shareholders
more stringent than federal law. Anenson remarks
ex post.
on the risk that the statutory standard may become a
“moral minimum.” If that occurs, she says, “unclean
Compensation clawbacks already exist under limited
hands would be available to fill the gap.” According
circumstances in the Sarbanes-Oxley Act and the
to Anenson, one of the advantages of the “clean
Troubled Asset Relief Program. The new requirement
hands” doctrine is that it relies on the expertise of the
that public companies adopt a policy to recover
Board, rather than regulators. “The beauty of judge-
excess incentive-based compensation paid to
made law like equity is that it can operate regardless
executive officers is restricted to situations where the
of political will and without the need for a one-size-
company must prepare an accounting restatement for
fits-all regulatory policy.”
material noncompliance with any financial reporting
requirement under the securities laws. Recovery is
“‘Clean Hands’ and the CEO: Equity as an Antidote
mandated regardless of whether the restatement
for Excessive Compensation,” is forthcoming as the
resulted from the misconduct by the company or its
lead article in the University of Pennsylvania Journal
employees. Recoupment under unclean hands would
of Business Law. The paper was recognized as the
be available without a restatement, Anenson says, but
Distinguished Paper at the 2010 Annual Conference
only where fraud or other unethical conduct involving
of the Pacific Southwest Academy of Legal Studies
excessive risk-taking was detrimental to the company.
in Business.
RESEARCH@SMITH
5
Award- inning
W
Multi-period
routing in satellite
New method can save millions for
satellite service providers.
networks
S
atellite services generate close to $96 billion each
Here is the problem: satellites in geosynchronous
year for the telecommunications industry, driven by
orbit are fixed at a certain location in space, always
satellite communications providers that operate large
remaining over one spot on the earth. A satellite
fleets of satellites providing a multitude of services to
will have multiple antennae (or beams) to transmit
government agencies and large customers like cable
and/or receive telecommunications signals. These
television companies and television networks located
beams can communicate with certain regions of the
all around the globe. Satellites are able to reach even
earth that are visible from the satellite’s location;
the most remote locations, allowing communication
this allows high-definition video, for example, to
without the need for significant infrastructure
be transmitted from North America to Europe. Up-
investment on the ground. They relay information
beams (toward the satellite) and down-beams (from
from location to location for their customers via
the satellite toward a specific satellite dish on earth)
satellites in geosynchronous orbit at different
must be carefully scheduled because not all satellites
longitudes. However, the satellites themselves cost
are capable of carrying the same types of signals,
hundreds of millions of dollars and have a relatively
and because there is a limit to the amount of traffic
short lifespan, so companies are under constant
that can be sent and received. If a satellite is close to
pressure to generate as much revenue as possible by
capacity, there may be no choice but to re-route a
using them to the utmost capacity.
customer’s information to another satellite.
In their article “Multi-Period Traffic Routing in Satellite
That causes a problem for customers. “If you re-route,
Networks,” S. Raghavan, professor of management
the customer must reposition their dish, which is a
science and operations management, and coauthor
time-consuming process. It takes five to six hours, and
Ioannis Gamvros, PhD ’06, show how a multi-period
there are customers for whom that is not acceptable.
routing solution could solve a long-standing problem:
You can’t have your cable television network offline
how to get the maximum capacity and revenue out
for five or six hours,” says Raghavan.
of satellite service networks working under rigid time
and cost constraints. Raghavan was awarded the
Because most satellite dishes are owned by the
2010 Management Science Strategic Innovation
customer, service contracts for satellite providers
Prize by the European Association of Operational
impose hefty penalties if the customer’s dish must
Research Societies at their annual conference in
be repositioned. In the case of a satellite change the
Lisbon, Portugal.
penalty can be as high as 40 percent of the provider’s
fee. In a terrestrial network, rerouting a customer’s
6
FALL 2010 : VOLUME 11 : NUMBER 2
Research by
Raghu Raghavan
traffic does not incur a significant cost. However, for
A multi-period routing solution solves a long-
satellite service providers, re-routing carries a serious
standing problem: how to maximize capacity
cost. These costs (or discounts) can significantly
affect the revenue generated by customers and are
a critical component of the cost structure in the
and revenue in satellite networks working under
rigid time and cost constraints.
service sector of the satellite industry. As a result
Raghavan and Gamvros’s model has been successfully
decisions concerning which satellite to use initially
tested on real-world instances with up to 30 satellites,
to route customers or whether to offer the service
1,500 services requests, and a planning horizon of
are extremely important because any deviation
five years. In all cases, the model achieved results
from the original commitment entails significant
that were between 40 percent and 60 percent better
financial losses.
than the satellite company’s previous approach,
representing potential operational cost reduction of
In their paper, Raghavan and Gamvros develop an
about $200 million.
innovative framework to make routing decisions
in the present by incorporating information on
“Multi-Period Traffic Routing in Satellite Networks” is
expected customer demands for many years into the
to be published in 2011. For more information about
future. Their approach considers routing decisions
this research, please contact raghavan@umd.edu.
for customers throughout the entire planning
horizon simultaneously, called a multi-period
routing approach, instead of progressively. To solve
this routing problem the co-authors developed an
innovative mathematical technique that applies to a
wide range of optimization problems with uncertain
information, such as demand information. As a result
they were able to generate operational plans for
satellite service providers with major cost savings.
RESEARCH@SMITH
7
Center for
social value
creation
Business schools spend a lot of time teaching students
program has been so well-received that this year the
how to create value for their companies and their
center received proposals for more than 150 projects,
associated stakeholders. It is part of the Smith School’s
just a dozen of which will be selected. Melissa Carrier,
vision to also teach students to create social value for
the center’s executive director, and assistant director
themselves, their communities and their world. In
Juliet Lloyd look for projects that have an achievable
fall 2009, the Smith School’s Center for Social Value
scope, will provide a meaningful learning experience
Creation (CSVC), was launched to help students gain
for the students and results in a viable solution for the
an educational core competency for exploring and
nonprofit. For many students, it’s more than just an
solving the business model issues that currently limit
opportunity to practice applying business principles
organizations in their pursuit of socially responsible
in the real world. It is an eye-opening and gratifying
corporate culture.
experience to see their recommendations put to work,
solving real problems for organizations doing good in
CSVC is the most student-centric of Smith’s centers
the community.
and its major offerings complement the student
experience with co-curricular programs, elective
“This year we will be expanding the CSVC program—
coursework and hands-on consulting projects. The
essentially franchising it—to other universities around
center also helps faculty integrate the concept of
the country,” says Carrier. “We have built a program
creating social value into curriculum in a strategic
with a structured methodology that works and we
and methodical way, without removing any of the
have seen a lot of interest from other universities.
core teachings of their disciplines, offering faculty
Our goal is three new universities this year. We’ll also
workshops and one-on-one assistance with
be developing a knowledge toolkit with all of the
course design.
deliverables, as well as templates and how-to guides
for organizations looking to achieve certain objectives,
A point of pride is the center’s Social Venture
such as creating a strategic plan or developing
Consulting Program, through which the center puts
a board.”
MBA and undergraduate students to work on solving
8
business problems for nonprofit organizations. Each
The Smith School’s proximity to Washington, D.C.,
student team devotes 60 to 80 hours over three
has allowed CSVC to engage in some interesting
months to their assigned project, working under the
partnerships with federal agencies as well as local and
guidance and supervision of a faculty champion. The
national nonprofits. Last spring the center teamed up
FALL 2010 : VOLUME 11 : NUMBER 2
with the U.S. Agency for International Development
While the center’s main focus is on students,
(USAID) for the Global Challenge, a first-of-its-kind
knowledge creation is also a key objective for CSVC.
competition that challenged teams of MBA and other
The center supports research through grants to
graduate students to develop business solutions that
faculty, encouraging them to explore issues that
supported international development. Teams were
impact the world’s most urgent social problems.
tasked with devising a new public-private alliance to
Smith faculty are currently working on studies related
allow a private enterprise to promote tourism while
to the management of humanitarian relief, microloans
contributing to international development initiatives
and peer-to-peer lending, financing patterns in
in southeast Asia. Eight finalist teams were selected
developing economies, and public incentives for
from 65 registered teams across 32 universities. The
green innovation.
competition offered students cash prizes, but also the
opportunity to connect with leading experts in the
The center is also committed to helping corporations
international development and business communities.
meet their organizational objectives in the area of
A second Global Challenge is being planned for 2011.
corporate social responsibility and social innovation,
and in connecting with students who align with their
Some students find their interaction with the center
organization’s culture and values. Individuals and
so inspiring that they go on to pursue a career in
organizations interested in partnering with the center
the nonprofit sector, or in one of many companies
may contact Carrier for more information,
that place social responsibility among their core
mcarrier@rhsmith.umd.edu.
values. Students can learn about creating social
change through market-based approaches, explore
career options and network with socially responsible
corporations at the center’s annual Social Enterprise
Symposium, which last year drew about 600
students from across the University of Maryland
campus. The symposium is partly organized by the
Terp Changemakers, a student group that is part of
the Ashoka UChangemaker Campus initiative and
supported by CSVC.
9
RESEARCH@SMITH
FALL 2010 : VOLUME 11 : NUMBER 2
9
How to Lead Your Team
to Top Creativity
Employees who had more autonomy felt
empowered by their managers and were
Smith School Welcomes
New Faculty
more motivated in their work. But that
Employee creativity can help organizations
was not enough to encourage creativity.
The Smith School is honored to welcome
weather storms, survive downturns,
Managers then needed to communicate
the following new faculty this fall.
out-innovate their competition and take
the importance of creativity to the
advantage of unexpected opportunities. So
organization and identify areas that require
Department of Management
it’s in a manager’s best interest to help his
creative solutions.
and Organization
“You have to channel people,” says
Rajshree Agarwal, Chaired Professor in
Kathryn Bartol, Robert H. Smith Professor
Bartol. “It’s not enough just to empower
Entrepreneurship and Strategy, received
of Management and Organization, says
people and let them go; you have to urge
her Ph.D. from the State University of
that the way you lead your team may be
creativity and set the direction.”
New York, Buffalo.
in your organization. Bartol, who has
Managers must also help team members
Department of Accounting
been studying the effects of empowering
understand the creative process. That
leadership for years, studied both
involves identifying the problem the
Michael Kimbrough, associate
managers and professional-level employees
organization needs to address, gathering
professor of accounting, received his PhD
(such as software developers and new
data to fully understand the problem,
from Indiana University in Bloomington.
product developers) at a large information
and generating possible solutions. Giving
Nick Seybert, assistant professor of
technology company in China. Bartol
sufficient time and attention to each stop
accounting, received his PhD from
found that an empowering leadership style
of the process is an important step to
Cornell University.
had a strong influence on the factors that
uncovering all possible solutions before
encourage employee creativity.
choosing the one that works best in any
Jim Staihar, assistant professor of
particular organization.
accounting, received his PhD from the
or her team be creative.
the key to fostering a creative environment
University of Michigan.
Empowering leadership involves
highlighting the significance of the work
How can you encourage creativity in
employees do, letting team members
your team?
and Information Systems
participate in decision making, conveying
confidence in their performance, and
Department of Decision, Operations
1. Make it clear that you are looking for
removing bureaucratic constraints that
new ideas. “You’d think this would be
Peng Huang, assistant professor of
might keep employees from succeeding.
obvious, but it doesn’t have an impact
information systems, received his PhD
unless you actually TELL people you
from Georgia Institute of Technology.
want them to be creative,” says Bartol.
Radu Lazar, Tyser Teaching Fellow,
2. Give your team autonomy with
direction. Empower your employees,
received his PhD from University
of Minnesota.
but make sure they’re addressing the
issues you really care about.
Inbal Yahav, visiting assistant professor
of operations research, received her PhD
3. Don’t evaluate ideas too quickly. At
from the University of Maryland.
the beginning of the creative process,
let people spend time gathering data,
Catherine Anderson, visiting assistant
exploring options and generating ideas
professor of information systems, received
without judging their usefulness. Some
her PhD from the University of Maryland.
ideas will work and some won’t, but you
want to mine all possibilities before you
hone in on a solution.
Top Creativity
10
The Smith School’s Executive
MBA program is ranked #22 in the
world by the Wall Street Journal.
Learn more at:
www.rhsmith.umd.edu/emba
FALL 2010 : VOLUME 11 : NUMBER 2
Featured Researchers
ThoughtLeadership@Smith Speaker Series
Leigh Anenson, associate professor of
Discover big ideas for thoughtful leaders at the ThoughtLeadership@Smith Speaker
business law, received her JD from the
Series. Each presentation by a member of our world-class faculty begins and ends
University of Akron School of Law. Her
with networking opportunities. Events will be held from 8 a.m. to 10 a.m. at Smith’s
research involves rethinking the role of
convenient local campuses in Washington, D.C., and Baltimore, Md. For more
ancient equity in contemporary court
information or to register, visit www.rhsmith.umd.edu/thoughtleadership.
practice in the United States. She is
formulating an overarching theory, based
Washington, D.C.
Baltimore, Md.
the case law on the role of these defenses
September 24
Avoiding the Winner’s Curse
October 8
Leadership and Creativity
in modern business litigation.
Hank Lucas,
Kay Bartol, Robert H. Smith Professor of
Smith Professor of Information Systems
Management and Organization
upon a critical historical analysis of equity
jurisprudence, to confront the confusion in
Gerard Hoberg, assistant professor
of finance, received his PhD from Yale
University. His research interests include
topics in corporate finance, industrial
organization, and empirical asset pricing.
His recent work in IPOs examines the
October 15
Shared Leadership in Teams
competitive industries.
Raghu Raghavan, associate professor
of management science, received his
Leadership, Innovation and Change
Resources and co-director of the Center
November 19
The New Science of X-Treme
Supply Chain Management
for Leadership, Innovation and Change
Sandy Boyson, research professor and
Paul Tesluk, Tyser Professor of
Organizational Behavior and Human
sources of underwriting profits, insider
trading patterns, and performance in
and co-director of the Center for
co-director of the Supply Chain
December 17
Cybersescurity and Risk
Management
Management Center
Larry Gordon, Ernst & Young Alumni
December 10
Optimizing Service Productivity
Professor of Managerial Accounting
Roland Rust, David Bruce Smith Chair
in Marketing and Distinguished
PhD in operations research from the
University Professor
Massachusetts Institute of Technology.
His research primarily focuses on network
CEO@Smith Speaker Series
design, data mining and auctions. The
unifying feature to these various research
areas is the network and combinatorial
CEOs are a great resource for our students—full of hard-won wisdom and invaluable
optimization techniques he applies to these
practical insights about their industry. Through the CEO@Smith Speaker Series, we
problems. Raghavan’s research is supported
give students, faculty, administrators, alumni, and local residents an opportunity to
by the National Science Foundation and
interact with CEOs and senior executives on the critical issues facing their businesses
the National Security Agency.
and industries.
Please join us for this year’s CEO@Smith Speaker Series. Events are free and open to
Gordon Phillips, Bank of America
the public; registration is not required. All events take place at 5:30 p.m. in Frank
Professor, received his MA and PhD from
Auditorium, Van Munching Hall, at the University of Maryland-College Park.
Harvard University. His areas of research
include corporate finance and how
Sept. 14, 2010
Feb. 22, 2011
Mayo Shattuck, Constellation Energy
Pradman Kaul, Hughes Network Systems
contracting in futures and forward oil
Oct. 4, 2010
March 2, 2011
markets. His work in corporate finance
John Veihmeyer, KPMG
Gail McGovern, American Red Cross
capital structure, Chapter 11 bankruptcy,
Nov. 3, 2010
April 12, 2011
how leverage buyouts and other forms
Walt Havenstein, SAIC
David Rubenstein, The Carlyle Group
Nov. 30, 2010
April 15, 2011
Dick Cass, The Baltimore Ravens
Kevin Plank, CEO Under Armour
financial decisions impact firms’ strategic
decisions, mergers and acquisitions, and
includes studies of private equity issuance,
of high debt influence a firms’ and rivals’
investment decisions.
If you would like to participate as a speaker in CEO@Smith, contact Tim Dennis,
tdennis@rhsmith.umd.edu.
RESEARCH@SMITH
11
Rocky Cintron is president and CEO of Force 3, which delivers, supports and maintains IT products and
implementation services—such as unified communications, security and data center—for federal agencies and
their partners. It is recognized as one of the fastest growing federal IT solutions providers in the mid-Atlantic
region and is one of Cisco’s top five federal Cisco Gold Partners in America.
ExecUTIVE profile:
Rocky Cintron
Rocky Cintron, CEO and president of
Cintron worked with Hugh
Force 3, started the company in 1991
Courtney, the Smith School’s vice
with a deep respect for the mission
dean of programs, and Jeff Kudisch,
and vision of the military and the
Distinguished Tyser Teaching Fellow
Department of Defense. Cintron’s
in management and organization,
father served in the Army and Cintron,
to design a classroom program that
a self-described “Army brat,” was born
would bring together a group of
in Fort Meade, Md., with the National
Force 3 executives for an intensive
not people will follow you depends
Security Administration right in his
three-day custom learning experience.
on your leadership style and the
backyard—almost literally.
“They put a lot of upfront effort into
relationships you have,” says Cintron.
our curriculum—they asked the right
“I have a passion for the Department
questions and took the time to really
The class members have formed
of Defense,” says Cintron. “Supporting
learn about us as a company and our
strong bonds with one another, and
them is a noble effort, which you
needs. There was a great connection
that has brought some surprising
realize when you see them out there
and really good communication,”
and very welcome side effects. “The
risking their lives.”
says Cintron.
back office staff does not ordinarily
work with sales and marketing, so
Because of his personal background,
The group read “Good to Great”
they might not have gotten to know
Cintron had an understanding of
by Jim Collins and had classes and
each other, otherwise,” says Cintron.
the unique challenges that come
strategy discussions led by Kudisch
“But now when there’s an issue, they
with serving the military-industrial
and other Smith faculty. “Many
have a better relationship. They see
sector that many other contractors
people told me it was the best class
each other as partners in solving the
struggle to achieve. “There are things
they’d ever taken,” says Cintron.
problem. It’s not just ‘me and my
you cannot talk about in support of
“They talked about Force 3’s vision,
department.’ It’s about the entire
mission, so there is a very small
about getting the right people onto
organization, and how we can have
group of people who can help these
the bus and making sure that the right
an impact.”
clients solve their issues, often for
people were in the right seats.”
The group will begin planning Smith’s
initiatives that have national impact,”
says Cintron.
When Force 3 brought back the
third year of leadership development
Smith School for a second year
with Force 3 this fall.
Because of that, Force 3 has a key
of training, part of the three-day
ongoing challenge—attracting and
program included a walking tour
For more information about the Smith
retaining talent, and mentoring
of the battlefields of Gettysburg, in
School’s custom options for executive
the next crop of leaders. Cintron
cooperation with the Gettysburg
education, please contact Greg
recognized that Force 3 had some
Foundation. It was a powerful
Hanifee, ghanifee@rhsmith.umd.edu.
high-potential leaders who needed
experience. “People came away from
to develop their leadership skills for
it with the realization that whether or
maximum effectiveness in their roles.
12
FALL 2010 : VOLUME 11 : NUMBER 2
University of Maryland
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the University of Maryland received approximately $407 million in sponsored research and outreach activities.
The university is located on a 1,250-acre suburban campus, eight miles outside Washington, D.C., and 35 miles
from Baltimore.
Robert H. Smith School of Business
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research. One of 12 colleges and schools at the University of Maryland, College Park, the Smith School offers
undergraduate, full-time and part-time MBA, executive MBA, MS, PhD, and executive education programs, as well
as outreach services to the corporate community. The school offers its degree, custom and certification programs
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In this issue
• Aligning pay with performance
• Saving millions for satellite providers
• Predicting merger success
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