trans-national voice issue 1

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Trans-national Voice

Issue 1, Winter 2008

IN THE ISSUE

Launch of the Trans-national

Leadership Series

Assistant Dean of Academics

Eva Porras

Become a Leader

Discover the McDonald’s

Empire

AND...

Exclusive interview

Yusaf Akbar on Emerging Markets

6

8

12

16

14

22

In Focus:

About...

Think Business

Globalization:

CEU Stories

Expert Talk

the

Student Journal




Trans-national Voice is the

first student-run

organization at the Central

European University

Business School. Trans-

national Voice is a

publication devoted topresenting the most

significant topics from the

world of business and

politics. The Journal is

created for the benefit of

the students, faculty, staff,

and alumni of the CEU

community. At Trans-

national Voice we provideyou an informational

platform for intellectual

exchange in a global

environment.

Trans-national

Voice

More information on

CEU Business School

CEU Business School

Frankel Leo u. 31-34

Budapest, Hungary

H-1023

Tel.: +36-1-887-5014

Email:

[email protected]

Editorial Contact

Email:

[email protected]

Tel.: +36-70-254-3101

Your

Founder and Editor-in-Chief : Rustam Jamilov (Azerbaijan)Assistant Editor: Rohan Servand (India)

Correspondent: Katie Rowland (United Kingdom)

Writers:

Ilya Baltinsky (Belarus), Givi Pantsulaia (Georgia)

Faculty Advisers:

Yusaf Akbar (Professor of Management at CEU BS)

Jay Fogelman (Program Director at CEU BS)

Hogan Hayes (Professor of Communications at CEU BS)

Special thanks to:

Tony Kmetty, Ewout van der Schaft, Noemi Sidlo ,

Dora Samak, and the Career Development Office


Eszter Zakarias,

Katalin Gelencser,

R. Servand A. Kurmangazina K. Rowland R. Jamilov

Team Coordinator: Aigerim Kurmangazina (Kazakhstan)

CEU Business School Student Journal



Dean’s Column

We are living in an era of rapid change, to which the business world tries to

adapt. In most fields universities lead the way with innovation and new

thinking. With business schools we struggle to keep up with the real world and

often find ourselves debating issues and practices that have already become

obsolete.

Introducing socio-political elements into our programs is an opportunity to

finally leap ahead of business rather than continuing to struggle just to catch

up. In the area of socio-political expertise, businesses have been incredibly

slow to grasp the impact social trends and public policy can have on their

business. Political structures change, the society driver changes, the

competition changes, the industries change. This is a very critical moment in

time when business and public policy could benefit from some cross-

pollination. To cope with change our school aims at helping you to become the

first breed of Trans-national Leaders who can move in and quickly adapt to a local market regardless of their country of

origin. Leading the change however is also in your hands.

In Europe, the expansion of decision-making and regulatory power of the EU is not just freeing up markets but also

creating what Brussels perceives to be acceptable regulatory regimes across a continent of 350 million consumers. The

newest phase in globalization (post-internet globalization) will focus on environmental technologies and their global

diffusion. It will be required for managers to think within and across borders not just in terms of trade and investment

but also to anticipate the in-country social and governmental impact of their strategies and tactics. Our goal is educating

and empowering students to become future leaders of the rapidly changing, multi-cultural and trans-national

environment. A good leader has a vision, sees the place to go and he/she also needs to get all the stakeholders, the

employees, the community, politicians, and government regulators to believe in his vision. A good leader needs to have

a broad view of society, and an extensive knowledge on different cultures is a must. We raise leaders, not just managers

and we teach you skills that reach beyond the analytical methods of business.

Because we are a part of the larger Central European University with a strong reputation in law, public policy and the

humanities, we are able to draw upon the experts in these fields to ensure our graduates will appreciate the overlaps

between business and society. Our socio-political courses are integrated with the core subjects in the curriculum such

as marketing, finance and economics to help managers understand that they cannot make decisions on functional

issues in isolation from the broader environment.

You are the first breed of the future Trans-national Leaders, so it is up to you to make the change. I envision you, walking

out of this school's door, to maintain your curiosity to be confident businessmen, with the appreciation for a deeper

knowledge on the history and tradition of the different countries you will find yourselves in over your career, because

these affect business and economy.

Enjoy reading the first issue of the The Trans-national Voice!

Sincerely,

Paul Garrison

Dean and Managing Director

Central European University Business School

W i n t e r 2 0 0 8 | 3T r a n s - n a t i o n a l V o i c e




Falling. Fallen. Hurt.The current fiscal year is etching itself into

history for all the wrong reasons. As the

populace of a rapidly changing world we standat an economic crossroad, with the road we

are journeying currently going downhill. Its

ability to pick itself up relies heavily upon

capital injection and lower interests rates for

borrowers. It is also necessary that the

injection made be systematic in nature. The

United States Government recently passed a

$700 billion bailout out plan after an

unsuccessful first attempt. The objective of

this plan is to buy out the troubled mortgages

before reselling them to investors in thefuture. This in turn will allow banks to resume

lending money, and in turn begin turning the

wheels of the economy again. If this goes according to plan, it should essentially clear the

nation of these large debts that financial firms are currently burdened under.

The initiation of this problem leads back to real estate agents and lenders who showed a

considerable amount of greed. They recognized an untapped market for sub-prime housing in

the late 1990's. With attractive loan and interest figures, they lured in masses of people who

could otherwise not meet the criteria for market interest rates. With predictions at the time

showing a rise in property value and with favourable initial terms, that were adjustable

further, many were enticed. But as property values began to regress in 2006, coupled withgrowing interest rates and higher adjustable rate mortgages, many individuals took to

foreclosure. This essentially marked the beginning of the Global Financial Crisis that we are

currently contained in.

(Continued on p. 24 )

Point of view

10 Belarus: Land Between Powers )

18 The Western “Support” to Georgia

19 Guess Who?

(I. Baltinsky

(G. Pantsulaia)

(Anonymous)

Contents

6 In Focus

8 About...

12 Think

Business

14 CEU Stories

16 Globalization

20 Career Quest

The launch of the

Trans-nationalLeadership Series

Academic Dean

Eva Porras

The journey

towards a better job

today!

Interview with

Dr. Paul Marer

Discover the

McDonald’s empire

Dr. Akbar on

emerging markets

22 Expert Talk

Quote of the Issue

(S. Johnson)

“A fly may sting a

stately horse and make it

wince, but one is but an

insect and the other is a

horse still”

4 T r a n s - n a t i o n a l V o i c e | W i n t e r 2 0 0 8

Trans-national

Voice

No material appearing in this publication may be reproduced without written consent of the publisher. The opinions expressed in this journal are those of the

contributors and are not necessarily shared by the CEU Business School.

Become a leader

by Rohan Servand

S t u d e n t J o u r n a l



Editor’s Voice

Dear Readers,

student-runorganization at the CEU Business School.

Business is more than just academics. No theory will prove to be useful without real-life

experience. And there are few better ways to explore the world than through a student

journal. Trans-national Voice is a unique project that will allow students, faculty, and alumn i

of the CEU community to speak about most vital components that constitute the today's

world – the global world.

Trans-national Voice is a massive informational platform for students and experts from over

50 countries. The Voice symbolizes the multicultural environment of the CEU Business

School as well as our unique competitive advantage – the global approach to learning. CEU

Business School has developed an innovative model of education. Here we are taught to

become trans-national leaders in a trans-national environment, to understand the

economical, socio-cultural, and political complexities of other countries. No school in the

world can match us with that.

In the first Issue of the Trans-national Voice you, together with Rohan Servand, will discover

the global empire of McDonald's Corporation. Exclusively for our first issue we conducted an

interview with one of the School's founding fathers – Dr. Paul Marer. Ilya Baltinsky and Givi

Pantsulaia talk about complex environments of their national states. In “Think Business” we

present you a quick guide on how to boost leadership skills. In addition, Katie Rowland

narrates about the launch of Trans-national Leadership Series and our first guest – Dr. Arpad

von Lazar, Professor Emeritus of the Fletcher School of Law and Diplomacy.

Sincerely,

Rustam Jamilov

Founder and Editor-in-Chief

W i n t e r 2 0 0 8 | 5T r a n s - n a t i o n a l V o i c e

The Trans-national Voice

I hope you will enjoy reading The Trans-national Voice!

I am proud to present the Trans-national Voice – the first



20 people attended thisunique event. Those

who missed it must

have certainly had a

strong opportunity cost

- comparable with and

important enough to

outweigh the wisdom

and experience of a

professor of Fletcher

School of Diplomacy

INFOCUS

“In Focus” is our regular section that provides a coverage of the most significant

about the visit of Dr. Arpad von Lazar, Professor Emeritus of Fletcher School of

Law and Diplomacy.

0800 hours… I joined roughly twenty of my at the top of most of these fields. But

Leadership' with Dr. Arpad Von Lazar. The room omitted to adhere to the firs t basic rule of

this speaker. I found it hard to comprehend that

only twenty people wanted to hear this man It wouldn't matter whether it was Georg e Bush or

international businessman. A quick google coming to speak. The fact would still remain that

search reveals that he has been involved in at 8.00 a.m on a Tuesday morning, the averag e

international affairs, global finance, the oil student desires only sleep, or cof fee, or sleep +

market and higher education. Furthermore, he is coffee.

By Katie Rowland

event in the school life of the pastt weeks. In this issue our correspondent talks

seemed a little sparse considering the status of marketing: know your audience!

peers for a discuss ion on 'Tra ns na ti on al when the school organized this discussion they

speak. After all, Mr. Lazar is a famous Vladimir Putin or even the Queen of England


Leadership Series

Trans-national



Dr. Arpad vonLazarProfessor Emeritus,

Fletcher School of Law and

Diplomacy

Dr. von Lazar is

Emeritus of International

Affairs at the FletcherSchool of Law and

Diplomacy. While at

Fletcher he was a founding

member of the academic

programs on international

development, international

energy studies and the

international environmental

program. During his

academic career Dr. von

Lazar has worked as a senior

advisor to major US and

foreign oil companies ,

financial institutions ,

foundations, the US

government and foreign

governments.

Dr. Arpad von Lazar

holds a Ph.D. and an M.A.

from the University of North

Carolina, as well as a degree

from the University of Vienna. He is also a recipient

of numerous honorary awards

and grants.

Luckily, the British Boarding school system taught me how to handle an early

morning, so I was among a minority of people who were awake enough to hear

Mr Lazar spoke in an eloquent yet relaxed tone. It was soon apparent to all of us

that the man speaking possessed a wealth of knowledge. He transitioned

US political structure and the modern education system seamlessly. And whilst

failing, Mr Lazar relaxed and simply 'chatted' about a few issues and some of the

things that business life has taught him. He focused specifically on the idea that

we should all be like 'Junkies', constantly searching for new things to try. He

Wise words from a wise man. Mr Lazar is certainly one of few inspirational

figures in society. It was touching to hear him refer to CEU as his 'last love'. But

“We are all too busy looking for the big lesson. We

tend to forget that under neath there are millions of

valuable experiences.”

the views of this distinguished man at such an early hour.

between the oil market, the current economic crisis, the Chinese economy, the

effortlessly discussing the economic h istory of the world, Mr Lazar even found

the time to pass around the croissants.

currently Professor

Managing to tackle the issues of 'transnational leadership' in under an hour is a

underneath there are millions of valuable experiences. ”

the sixty minute chat left me wanting more. I believe that Mr Lazar could have

next fix.

return to us (at a more sociable hour), because like a 'Junkie' I am craving my

challenging feat for any speaker. Mr. Lazar knew this. Rather than trying and

remarked: “We are all too busy looking for the big lesson. We tend to forget that

broad subjects he was only able to touch the surfaces. I hope that Mr Lazar will

spoken all day about almost anything. In such a short space of time and on such

W i n t e r 2 0 0 8 | T r a n s - n a t i o n a l V o i c e 7



about...Associate Dean of Academics,

Dr. Eva Porras

What do you, as a specialist in finance, think the CEU attention to the fact that theBusiness School students should learn from the

current financial crisis? What are the take-away , and much less if that

points? Is there anything from what we are life style is making ends meet.

observing now that we must never repeat?

As a finance specialist I would remind everyone that What qualities do you think a fresh graduate should

the markets are mechanisms for exchanging certain have in order to become successful in business? And

assets. Price discovery is a result of this exchange and any specific qualities for finance sphere?

it is therefore independent of the fundamental value

of the assets traded. That is, the price of a certain I think “success” if understood in the business sense is

share at a specific moment will be determined by a a very relative term and partially the result of a

number of variables including volume traded which is number of factors, some of which the student cannot

itself affected by the liquidity in the market and control. alternative uses for the money, the cash flows the the one that should concern us - . In

given company is expected to generate in the future, my experience, this means to do “your duty”. So

and so on. Therefore, as conditions and expectations whichever the definition of success, within those

change, so do prices. variables we can control, hard work accompanied by

other qualities such as honesty, kindness and

I believe we cannot prevent traders behaving in a generosity are a good mix to start off. In the financial

speculative manner because investors saving and sphere, just as probably any other,

postponing consumption logically want the maximum and to have a deep understanding

return for that sacrifice. Other people have been of the issues.

accused of having had a major role in the crises such as

those who assisted low income citizens obtain Could you recall an example from your past

mortgages. Well, this requires another opportunity academic/work experience, when you had to

for discussion as simplification of the issues and overcome a challenging situation? What was the

tradeoffs does not help understand the situation. outcome?

What we can do is remember that well developed

markets, such as the NYSE in USA, have average Yes, I do remember many instances when I had to

annual standard deviations of approx 20% for the overcome a challenge. The interesting thing about

price of large company shares. This should help this is not when you successfully resolve a situationeveryone infer how markets behave regularly and in because there exists such a clear solution you can

extraordinary situations. This should also be a call of reach without compromising.

market is not theplace to keep all those savings you need to

maintain a certain life style

success

is to be in peace

it is fundamental

to keep updated

However, in a larger sense- which is

“About...” is our new series of interviews with

the School faculty members, staff, and alumni.

In this issue we talk to Dr. Porras, our Professor

of Finance and Associate Dean.

By Rustam Jamilov




The truth is that life presents you with options in “non-standard” environments. It is CEU ´s mission to

which there are no absolute “goods”, “truths” or take on that challenge. In addition, once I had come to

“wins”, but tradeoffs among which we have to do my interviews, my wonderful colleagues and the

choose. , how to live beautiful city were two very strong additional

with difficulties and with lack of optimal solutions is motivators for wanting to join to CEU.key in becoming an adult in the full extent of the

word.

As far as we know, you are currently in a process of

Did you participate in any college or graduate-level writing two books. Could you give us a brief insight

extracurricular activities that you think have helped on what their major focus will be? Was there any

you become successful? specific reason or interest for choosing the particular

topics?

No. I began working full time when I finished

attending my first college by the time I was 19. Ever For several years, the publishing house had been

since then I worked full time while I moved on to asking me to write something in the area of finance.

studying a number of things which are not in my There are several topics I enjoy and consider my area

resume, such as photography, literature, etc. It was of expertise. One of them is the Cost of Capital, which

later, after I had already worked for CBS/FOX that I is the title for the volume scheduled to come out first.

moved to the USA and began studying my BS in The reason why this subject interests me is because

Business Administration, my masters, and my PhD, even though this variable is the engine of the economy

but . What I want to say is (obviously not alone) and even though capital is

that, unfortunately, I had literally no time for college utilized by every business, in my experience

activities. Still, in college I managed to make the best

friends I keep today, that I consider my success. I thought that a

However, I always wish I could have enjoyed a time comprehensive, easy to read, and detailed book

during which I could solely focus on my studies and targeting managers was needed. I also have talked

th e wo nd er ful co mm un it y ar ou nd th em . about completing other books for the same publishing

Nevertheless, it was just not possible for me. house such as one on Derivatives and another in

Facility Management.

Ìs there a nything you would like to say or wish to our

readers?

Yes, I would like to recommend them to focus on

today. First, because I believe it is an excellent practice

to achieve some “mind and emotions” control.

Second, because it is the only way to fully takepleasure in what life brings your way.

Is there any specific reason for joining the CEU

Business School? I would also ask

them to enjoy the opportunity of creating a small,Yes, I am personally committed to CEU's vision. It has wonderful, fun community around the school that

been my life-long belief that progress can be they can take with themselves in their memory onceadvanced through knowledge and education and they move on to other challenges. If they do today thethat research is critical in identifying and best they can, then, they will also be ready to do theirunderstanding problems. Nevertheless, it has also best in future new environments.

become obvious that these words have a differentmeaning in this time and age. A new visión is critical

Thank you for talking with us!to identif y, understand, and deal with situations in

Learning how to compromise

I never stopped working

managers do not have a clear complete

understanding of the subject.

So I would ask

them to work very hard and get out of the

classes and experiences with the colleagues and

professors as much as possible.

“A new vision is critical to

identify, understand, and

deal with in “non-standard”

environments.”




Land Between

Powers

Belarus? Yeah, I've heard a little about it… it's a part of

Russia, isn't it?

Ukrainian Slavs, came from the merge of Slavs and Balts,

a Scandinavian people. That certainly made the peopleI've encountered such a question almost

inhabiting my country somewhat different in terms of every time I was abroad making friends with people.

culture and values.People barely ever knew it was a single country; nor did

they know the country's location. In fact, Belarus isThat couldn't but arouse people's interest in creating an

located in the geographical center of Europe and isindependent state in the Belarusian land. Small

greater in area than Austria, Netherlands, Belgium, andprincipalities of Central and North-Western Belarus

Switzerland put together. Home to Mark Chagall and

consolidated into the Grand Duchy of Lithuania (GDL),Thaddeus Kosciusko, Belarus has always been at the

crossroads of two worlds, European and Russian, which

dramatically affected lives of all Belarusian generations.

which had by the middle of the sixteenth century grownThe story of international influence on my home country

into one of the biggest states in Europe. As it covered theunfolds along with the development of the Belarusian

area between the Baltic and the Black Sea, it drew all thestate. Starting from the tenth century, the conquerors

wars in the region. But then again, Tsars in Moscowfrom the East furiously attacked the Principality of

continuously claimed the land belonged to Russia and byPolatsk, the first known state to establish here.

all means, including wars and assimilation throughConsequently, the Principality was subordinated to

religion, tried to seize the land. GDL, as a pro-WesternKievan Rus, a stronghold of Moscow's future

catholic state, didn't accept the ideas implemented byspeculations that the peoples of Russia, Belarus and

orthodox Moscow and sought for closer cooperationUkraine descended from one nationality. However, most

with Poland on the West.scientists agree that Belarusians, unlike Russian and

“People in my country differ in

terms of culture and values”


by Ilya Baltinsky



GDL and Poland eventually merged, creating an after the USA. The commons, on the other hand,

even bigger country. Political center shifted from preferred to stay calm and obedient as it came to

Lithuania (that was the name for Belarus at that politics.

time) to the Polish side. Lithuanian unique culture

started experiencing a decline as it was vigorously The Belarusian society today in many ways

oppressed by Warsaw. Subsequently, Belarusian resembles that of the end of the eighteenth century.

language was prohibited everywhere; instead, Having come through the Russian Empire's

Polish was deemed the language for all. Moscow, in intervention in the nineteenth century and then

turn, applied its politics of “religious intervention,” through the hardships of the Soviet Union,

that is, convinced Belarusians to adopt Orthodoxy. Belarusian folk failed to maintain control over their

own authenticity. Use of Belarusian language was

Some were persuaded. Coming from a slightly banned until the mid-1920s, the time when

different origin than that of Russians', those who communist Moscow searched for support among

took up Orthodoxy still drew in a great deal of periphery republics. However, Stalin repressions of

Russian culture in Belarus. However, there also the 30s and the World War II, in which Belarus lost

remained Catholics – chiefly the rich, who lived up every forth man, added up conservatism and

to the Polish way of life; in addition, the whole reluctance to get involved into politics to the

populat ion of Weste rn Belarus professed character of a common Belarusian.

Catholicism. All that, together with the originality

brought about by those who still maintained the Only after the USSR collapse in the 90s, Belarusian

culture of Eastern Slavs and Balts, archetypal for identity started reviving. Events of the history left

Belarus, mixed together to create something new. It their trace on what Belarus is now. Conservatives

was a society of tolerance and hospitality, bearing are still awake; liberals now have their say. In shape

cultural particularities of all bordering countries. of Belarusian original traditions, they represent

The wealthy had a rather progressive mind-set, and confluence of two different world perceptions,

in 1791, together with the Polish, accepted the first offspring of the ever-lasting struggle of the West and

Constitution in the continent, second in the world East. This is Belarus, the Land between Powers.




think business

In Think Business we are providing you with insights on the most vital techniques necessary for becoming asuccessful businessman. Think Business will assist you in your life-long quest for personal, academic, and career

development. Our series of informal articles and real-life stories will be beneficial for both students and

professionals.

Leadership has become a common buzz word in the

world of business. It is a skill worth possessing by some

means. It allows for one to break out of the ordinary

and exercise their ideas via their leadership. More

importantly it can take you places.

Leadership is often linked with management.

However, the two concepts differ in essence.

Management is the process of managing people.

Managers assign appropriate tasks to people they

think can handle the problems. Leaders, on the other

hand, share this unique emotional belongingness with

the team to reach the common goal. Leaders attempt

to supply others with the necessary skills with an

emotional touch in order to succeed.

Competent – Behave and

reason in a mature way.Reasoning and moral values are

always above unwise emotional

desires.

Inspiring – Being confident in your actions.

Constantly show your team that they know

what they are doing. Don't dominate however;

lead, not rule. Remember that no one can't do

everything alone

Intelligent – Continuously

progress. Develop crit ical

reasoning, and analytical skills.

Broad-minded – Diversity is anally. Look for different angles on

the same question.

Honest They are sincere with –their team members. Deception

has not yet helped anybody.

Common Leadership Traits

“ Management is doing things right; leadership is

doing the right thing”

Peter F. Drucker

Most leaders, regardless of nationality, upbringing and mind set, share several common traits. These

traits are called Leadership Traits. Generally, true leaders tend to be:

By Rustam Jamilov




10 Steps to Become a Better Leader

The theoretical insight on leadership is very

important. Although it takes time to develop

these skills, there are numerous possible

ways to make a good practical start. Here is

our advice for you to become a better

leader now:

. A small-scale project. Invite

your friends to volunteer at a local elderly

house, or organize a trip to a local

museum.

. Set the goal of your project.Inform others of your ideas. Build the

timeline and plan your actions.

. Pass your passion to your

friends. Let them share your beliefs.

Explain the importance of your initiative.

. Coordinate the work. Delegate

tasks if necessary.

every unpredictable situationwith confidence.

. Be flexible. Keep in mind the

cultural differences. Accept opposing

views. True leaders are lenient and ready

for challenges.

Establish

Develop

Motivate

Integrate

Handle

Tolerate

“Leaders are commonly defined as individuals with anextraordinarily developed ability to effectively inspire and

lead people or organizations. Effective is perhaps the crucial

word here, because many of us understand the importance of

taking the leading role, representing a group, and directing

towards the set goal. However, leaders are not just charismatic

people full of motivational drive. Given the complexity of the

world we are living in today, energy is not sufficient to

effectiveness. And it is only effective leadership that brings

result. When aiming to start your own business, organize an

event or take any kind of initiative that implies leadership

duties, the not-to-be-neglected aspect is the productiveapplication of knowledge. For leaders are praised only when

the right skills are employed on the right paths.”

Plan thoroughly. Planning is 30% of success

Gather your team wisely

Ensure effective and comfortable communication

Build trust and confidence

Manage your time efficiently

Be responsible for your words and actions

Serve as a role model

Know when to take the mask off and laugh

Remember about social responsibility

Learn throughout your whole life. Remember the Socrates'

“All I know is that I know nothing”

Editor’s Insight

Try it Now!

Leadership Statistics

69%

75%

11%

86%

of business leaders say it's importantto have a mentor.

of executives say good physical fitness

is critical for career success at the executive

level.

of surveyed CEOs either have or are

considering establishing a charitable

foundation or donor-advised fund.

When dealing with suppliers, of senior

executives say a lack of ethical standards

would be enough to not do business with a

supplier




CEU Stories is our section on the facts and affairs of the lives of

Central European University and the Business School. Here we

will attempt to share some of the less known truths about our

university. In this issue we present you an interview with

, Professor Emeritus and one of our founders.Dr. Paul Marer

of what an effective business school is like, how it isDr. Marer, you are one of the founding fathers of

managed, and what are some of the opportunities andthe Central European University Business

pitfalls of setting up a business school in theSchool. Could you tell us a few “insider” facts

communist world. It so happened that a member of about the foundation of the School?

the Business School faculty, Joseph Battat, had the

recent experience of having established the firstStudents might be interested in knowing something

Western-style business school in Shanghai, at theabout the fascinating history of the CEU Business

request of the Chinese government, so he was able toSchool. As someone who was present at its “creation”,

share his experiences and make many practical

suggestions.

Between 1975 and 2000, I was professor of

international business at the Kelley School of Business

of Indiana University, Bloomington, in the USA. Myfriend and colleague across campus, Hungarian-Chair

Professor George Ranki, called one day in 1987: “I just

learned that George Soros [one of the world's most

successful, Hungarian-born U.S. investors, a prolific

author of books, a major philanthropist], and a friendIn the evening of the first day we organized a banquet

of his, Sandor Demjan [then the head of a large, state-and asked Mr. Soros to speak. He sketched his dream

owned bank in Hungary; today, Hungary's richestabout the first Western-style business school in

entrepreneur] are thinking about establishing a

Central Europe. He also spoke, humorously, about justgraduate school of management in Hungary, to trainthe day before having lost $287 million dollars as the

outstanding students for management roles in the

then still Communist Central Europe. Soros asked if

Indiana University could help. What can and should The next day Soros and Demjan worked out the

we do?” funding details of the new school, called the

International Management Center (IMC), and asked

Ranki and I invited George Soros and Sandor Demjan Prof. Battat and me to help with the task. We had

to spend two days in Bloomington in October 1987. volunteered to work on this exciting project for eight

months, whenever we could find the time. At the

The first day I arranged for them a program, with the end of that period one of Mr. Soros' organizations

participation of dozens of business faculty and deans, took over the planning details.

“My friend called me one day: ‘George

Soros and Sandor Demjan are thinking

about establishing a school of

management in Hungary’”

let me tell you a brief story about it.

result of the dramatic decline of the stock market.


CEU stories

By Rustam Jamilov



The IMC was established in 1988 and the first group of 30 students was admitted in

1989. In 2001 the IMC became a part of Central European University, established

by Mr. Soros in 1991, that is, several years after the IMC. Since then the School has

grown in size and reach; for example, we now also have two undergraduate

Last year, at an event involving the CEU Business School, where Messrs. Soros andDemjan were the featured speakers, Mr. Demjan recalled the Bloomington

meetings in 1987: “On the second day, when George and I were discussing the

details of setting up the IMC, I asked: 'George, how can you focus so sharply on the

minute details of setting up a new school in Budapest when just yesterday you lost

$287 million on the stock market?' George replied:

.'”

conclusion?

This story tells you a great deal about the man whose far-sightedness and

generosity is responsible, more than anyone else, for you studying at this School

today. I hope that you'll make the most of the opportunity, first and foremost for

your own sake, but also as a good way to express your appreciation to the School's

founders.

this series of interviews in our future issues?

Thank you very much, Dr. Marer!

'There will be plenty of

opportunities to regain the money lost, so I am not worried. But the

opportunity to establish a management school to serve (communist)

Central and Eastern Europe may not ever again present itself, so I ammaking the most of the opportunity

Dr. Paul MarerEmeritus Professor,

M.A., Ph.D., University of

Pennsylvania (Wharton)

Professor of International

Business, CEU Business

School, Budapest; Academic

Director (2000-2004);

Professor and Associate Dean

for Academics (August 2006-August 2008).

Appointed by President

George Bush in 1990, re-

appointed by President

Clinton in 1996 and by

George W. Bush in 2001, to

the Board of Trustees of the

Hungarian-American

Enterprise Fund.

Twenty-five years at the

Indiana University's Kelley

School of Business (1975-

2000), promoted to full

professor of international

business.

Consulting experience with

the IMF, the World Bank, the

UN, the OECD, USAID, Eli

Lilly, Cummins Engine Co

and other firms.

Wrote or edited 20 books and

150 articles and chapters,

mainly on the changing

political, economic and

business situation in

Hungary, the other countries

of Central and Eastern

Europe, Russia and China.

Honorary doctorate,Budapest University of

Economic Sciences (1999).

degree programs.

With so much experience to share with us, would you mind continuing

influential thinkers and personalities of our time.

founder, benefactor, and Honorary Chancellor of CEU but is also one of the most

Yes. In subsequent issues I'll tell you more about George Soros, who is not only the


What should the students learn from your narrative? What is the key

What was the reaction of Mr. Soros to the loss of $287 million in just few

days?



globalization

society

In “Globalization” we discover the largest

corporations on Earth that had the most

influence on the business, political, and

social aspects of our lives

E. Hobsbawm has labeled the period since 1991 onwards as the Globalization Epoch. Indeed, quite lately the

world has experienced the fast ongoing process of globalization. This term has several definitions and

explanations. However, for us, future businessmen, only one fact really matters - most of our business

transactions and negotiations will include 2 foreign positions or more. Should that be political factors, cultural

differences, or historically embedded ways of doing business, one thing remains crucial and

. In this issue we discover the McDonald’s Corporation and

how its global expansion has affected people across the globe. Here we look at how McDonald’s manages tointegrate its food strategy and think globally, while considering regional differences and act locally.

that is

preparedness to work in a global environment

By Rohan Servand

business political

1 6 T r a n s - n a t i o n a l Vo i c e | Winter 2 0 0 8



Food

there is a little bit of America in each one of

them

McDonald’s has entered so many markets by

adapting to them.

has proved itself to be one of the best agents of

cultural migration. It is no longer impossible to find a

foreign cuisine in most major cities across the globe.

People are able to enjoy cuisines from countries theyhave only heard of, and in turn get a small taste of its

culture. Foreign culture is often intriguing to the

point that people temporarily lose their own

traditions in order to get the best experience from

another.

Food has always had the ability to push some of its

values on a host nation. The large, yellow,

unconventional 'M' that symbolizes McDonalds is a

powerful example of cultural invasion. With over

31,000 outlets across the globe, it is safe to say that

onto this and began offering colourful 'Pogs' in Happy. The food that it has to offer is just one mediumMeals across the Atlantic in Europe where the trendof cultural transfer. The outlets are often designed tonever actually managed to go into full throttle.offer an American look or at least a look that is

synonymous with the company. Its franchise base isHowever McDonalds does not go global solelyamongst the strongest and best in the world.through its venues and products. Sponsorship of Regardless of where you are you can almost alwayscolossal sporting events like the 2008 Olympics, andget the same taste on products. I say almost alwaysproviding meals at the Athletic Village are otherbecause McDonalds has often gone out of its way tomethods. Its appeal globally has even found itself aalter products to get a better reception in certain

place in the British weekly, 'The Economist'. With thelocales. For example, in India where the majority of help of the Big Mac, the Economist comparesthe country do not consume beef, McDonalds wipedPurchasing Power Parity across the globe. They choseall beef burgers off the menu and replaced them witha product that could be found in most markets, goingchicken along with a twist of Indian flavour.to show the widespread presence of McDonalds and

in turn American culture worldwide.However there are other tiny details that bring

America to the world through McDonalds that often

go unnoticed, especially in Europe. In many Arabic

However while doing so, theycountries clothing is a modest affair for the majority

never have forgotten to remind their customers andof the country. However, even in such locales, where

employees that they are an American brand. With thepossible, McDonalds has imposed polo shirts and

help of fast food theytrousers for women and men alike. With brighthave been able tocolours they obviously stand out and in turn impose

impose their culture inwestern dress culture on foreign soil. Even the toys

every corner. After all,that come along with every Happy Meal transfers a

food is an awesomelittle bit of America to the world. They often depict

age nt of cu l tura lfictional characters from animated movies that are

migration!being released or shown at the time. Through such

marketing tools, companies like Walt Disney better

their revenues in multiplex' outside the USA. If not

toys that relate to characters, they instigate children

outside the USA to follow the latest pastimes. For

example in the early 1990's 'Pogs' became asensation across North America. McDonald’s caught

Ron welcomingguests in Traditional

Thai fashion

Winter 2 0 0 8 | T r a n s - n a t i o n a l Vo i c e 1 7



Western “Support”

to Georgiaby Givi Pantsulaia

More than two and a half been a serious signal for the Internat ional

months have passed since Community. However, there were no reactions.

t h e t h e 5 - d a y w a r Finally, on August 6 the separatists did not let the

between Georgia and Russia ended. Many questions Georgian members of the Control Commission on

arose about the preliminary actions that could be Conflict Resolution enter the region to attend the

implemented for avoiding the military confrontation commission’s meeting. Negotiations broke down. Stillin the Samachablo region. (A historic name for the no actual response from Georgia's “Supporters”.

former Soviet “South Ossetian Autonomous District”,

nowadays called “South Ossetia” by the local Certainly, the US and western-European states,

separatists, Russia and unfortunately by the alongside the UN, NATO and the EU showed their

International Community) Indeed, the West had more support for Georgia against Russia within this matter.

than enough power to generously contribute to However in the time of need there was no practical

maintaining peace in this breakaway region of aid. Even when Russian troops came out of the

Georgia, taking into account the fact that there were conflict region of Samachablo and occupied the

serious signs of a potential conflict that had been neighboring town of Gori which is under the

frozen for more than 15 years. Far more was expected jurisdiction of Georgia's central government, the

than what was actually done. official statement made by Nicolas Sarkozy on behalf of the EU “condemns the Russians' disproportionate

A month before the start of the clash between the reaction to Georgia's aggression to South Ossetia”.

Georgian military forces and the illegal separatist This made it clear how weak EU appeared to be in

formations which were later joined by the Russian confronting Russia and pushing it for maintaining

Army, the Russian Federation conducted military peace. Neither economic nor diplomatic sanctions

training “Caucasus 2008” close to its border with were posed against Russian Federation. The UN,

separatist region. Later on, just a few days before the which stands on the basis of keeping global peace

opening fire, the de-facto government announced the failed to carry out the mission it was built upon.

evacuation of the local population. Six Georgian

police officers were killed. These facts should have Each and every victim state will always ask the

International Community a question:what did they do in order to

avoid the war and maintain the

peace? Georgia is one of these

victims asking this very question.

What did THEY do to avoid war and

maintain the peace?

?




Guess Who? Anonymous

Class was full today, but still the sounds of shuffling uneasy about all this attention.” I couldn't blame papers and cross-talk could not drown out the loud him. Track wasn't my close friend, however we did bell at the beginning of class. Sitting next to me, one chat occasionally. I could see the emotional mix heof the schools hockey players was sunken low in his was experience. All too soon the small town he grewseat, probably avoiding any unwanted attention he up in was beginning to single him out because of his

might draw. Mom. I patted his shoulder, and continued on to my“How's it going man?” I asked softly, as class next class.

had slowly start to begin. “Fine. Just a little tired, By lunch, rumors began to circulate.that's all.” He replied. Apparently his mother was dropping by the school to

“Well, we have short classes today because speak at our assembly. Now I understood. That of the assembly. Woohoo! How late were you up makes a lot of sense.anyway?” I asked. He hesitated at first, but The rest of the day was lost in a haze, as manyeventually said “Pretty late, I just flew back from the of the kids anxiously awaited the coming assembly,lower 48 last night with my Mom.” each of them eager to see if the rumors were true. It

“Man, you gotta be tired” I said. was to be held in the schools gym, the only room“Yeah, and I almost died of boredom at all large enough to house the school's still growing

those conventions with Mr. John and others” He population.said. The room filled quickly, and I found myI laughed and said “I don't really follow all place amongst a few friends. Let the games begin.

that stuff too much, to be honest.” It was a safe reply, The lights dimmed a bit, provoking the roomsfairly neutral I thought. The conversation came to an anticipation even more. Afterwards, the crowdawkward halt and we both retreated to our slowly fell silent. A dark figure made its way to thenotebooks. center of the gym. It was our Principle. He took his

When class ended he hurried out, everyone time adjusting the microphone in hand, but soon hiselse took their time. At my locker, I couldn't help but voice was resonating clearly throughout the gym.overhear him talking on his phone: “I think most of you know what this

“No, you really don't assembly is about,” he said, “so I can skip the

have to.” introduction.”“What for?” The whole room went dead, frozen with“I'll just meet you expectations to finally hear Her speak in the school

somewhere else.” “Students, I give you the next class“Yeah, I made my bed President.” he announced. Everyone gasped for air.

this morning.” What is this? Instantly the gym was filled with a tide“Fine, bye.” of whispers. I sensed disappointment.

I approached hi m, “I wanna go home!” someone yelled in the“Track, Is everything distance. I agreed to that, this was a waste of our alright?” I asked. time. I turned to my friend, and with a sarcastic tone“I guess,” he said, of voice he said, “Well, we sure expected someone

with certain distress, else.” “Whom?” someone asked. “Track Palin’s “it's just that I'm a little mom, of course. Sarah Palin”

?

Based on my high-school experience




t u d

S

e n t

W o r k

s

p s

h o

landing

aNo matter what degree one is pursuing, the ultimate goal for any

student is to get a well-paid job in a good location with vast

potential for growth. The problem is that everyone wants a well-

paid job in a good location and potential for growth. Moreover, the

market requirements are growing more rigid every year. For

instance, if 10 years ago a fluency in one foreign language was very

much sufficient to landing a decent job, the situation is different

today. Most successful graduates speak 3-5 languages, not

mentioning the academic and extracurricular achievements

shining out from their resumes . Therefore, it’s quite difficult given

the modern flow of events to secure a job.

job

e

d

E x p

r t

A

v

i s o r

y

e

k

i

N

twor

ng

Career QuestIn Career Quest the Trans-national Voice, in

cooperation with the CEU Business School

Career Development Office, provides the

readers with various advice and tools for

building a better career. Find out what events

took place at CEU Business School in the past

month and make sure you attend the

upcoming fairs and showcases since they are

bricks on your life-long career construction!

“Choose a job you love, and you will never

(Confucius)

By Rustam Jamilov


have to work a day in your life”



There is good news, however: CEU Business School is one of the unique

institutions that highly stresses the importance of assisting students in

making the right career choices. Only in recent weeks the members of

the CEU community had a chance to attend corporate showcases of

Credit Suisse, CEMI, and Egon Zehnder, as well as several

undergraduate and graduate workshops.

Overall, the career related events at CEU Business School constitute

the very core of the “success cannonball”. As seen from the illustration

on page X the four principal activities that will help a student land a job

are:

The latter one comes perhaps in

consequence of the other 3. By attending various conferences and

affairs participants not only increase their chances of getting a call

from, say, Credit Suisse a few weeks after the showcase, but also to

meet new people, exchange business cards, and contribute to the list

of personal contacts. It’s crucial to remember that the freshmen andsophomores of today are future decision-makers in their home

countries. Given the fact that 80% of the CEU Business School student

body is international, and the country portfolio includes some 30

nations, we are talking about a massive networking platform hiding

behind the three lettered “CEU”. It’s at the same time beneficial for the

visiting companies as well to ask for an e-mail of our student: you never

know who you will be doing business with in 5 years.

While the career events are the cannonball, the cannon itself is - the

student. No matter what resources a school implements to see its

graduates on the list of “The Best Companies to Work For”, themotivation and effort must come from the student only. For example,

. Yes, one might argue that grades are not sufficient to higher

incomes or faster promotions. And we in no way disagree. However,

grades just... matter. Everything on the checklist matters: experience,

grades, recommendation letters. Letting one of the factors down hits

your chances of getting your dream position. And academic

performance, we believe, although with some room for speculation, is

the easiest basis for a company to make the final decision concerning a

particular candidate. Seeing the numbers on the list is way less

complicated than judging the listed internships, whether thedescription and difficulty would actually be similar in a different

company and/or country. Hard facts are always more persuasive.

So, landing a good job is never easy. However, results usually outweigh

the costs. Construct your steel cannon in classes, and don’t disregard

the career affairs. Those provide the necessary intellectual weapons to

hit the bull’s eye of your life.

corporate showcases, advisory from experts,

workshops, and networking.

one should take care of the grades before applying for

jobs

Finally, it’s important to note that all our corporate showcases and

student workshops would never take place without the diligent efforts

of our Career Development Office staff. Every day those people areworking really hard to make sure we receive the appropriate advice

and training on all career-related topics. On behalf of the Trans-

national Voice team, I would like to express our sincere gratitude for

everything they have done for us so far!

Past Events

15 October: Resumé Writing Workshop

20 October: Global Management Challenge (GMC)

presentation

28 October: Corporate Showcase – Credit Suisse

4 November: Undergraduate Workshop, Resumé

and Cover letter writing

14 November: Egon Zehnder Corporate Showcase

20-21 November: Careers in Europe – job fair inBudapest

28 November: CEMI Corporate Showcase

Credit Suisse Corporate Showcase. October 28, 2008




expert talk

?Yusaf Akbar Received

his doctorate at theSussex European

Institute, University of

Sussex, UK.

?Editor- in- Chief of

the International Journal

of Emerging Markets

?Main teaching

interests are in

International Business,

Strategy, InternationalTrade and Investment.

?Main research

interests are in

international trade and

investment, EU

integration and the

politics of multinational

enterprise strategy.

?He published two

books in 2003, the firstentitled EU

Enlargenment and

Central Europe:

Regulatory Convergence

and the Multinational

Enterprise and another

volume, Global

Antitrust: Trade and

Competition Linkages.

?

Dr. Akbar has taughtin many countries such

as USA, Italy, UK,

Bulgaria, Canada, etc.

Can the BRIC Emerging Markets help the Worldthrough the Global Financial Crisis?

So now we are at a moment of reckoning debacle has pointed out on numerous

in the current phase of the global occasions that speculative bubbles will

financial crisis that have frozen credit occur and it is a matter of managing

markets and sent equity markets into a them. We appear to have let this bubble

tailspin. The big issue we now face is grow to fast and without adequate

whether or not the leading emerging oversight.

markets of the world economy, notably

the BRIC group (Brazil, Russia, India and While the blame game will need to be

China), can save us from a global played as we consider future regulatory

depression or whether they too are strategies to harness the power of free

being dragged down in the after markets without becoming wedded to

currents of the US, UK, Japanese and libertarian ideology, we need to focus

West European slowdown.` right now on how we can manage this

slide and who will be the key players in

Comparisons been drawn between the making this slide a gentle one.

current crisis and that of 1929 and 1908

- where financial markets collapsed What is unique about Brazil, India and

after a speculative bubble burst. Indeed, China (and to a make lesser degree

this comparison makes sense - and as Russia) is that they have significant

George Soros - one of the few finance domestic market potential.

gurus to have financially survived this

by Dr. Yusaf Akbar

2 2 T r a n s - n a t i o n a l V o i c e | W i n t e r 2 0 0 8



With populations in India and China in excess of 1 face of the global turndown – we cannot afford a repeat

billion people in each country, if the floor on of the post-1929 response. Fourth, developed country

developed country demand collapses, there's the companies will also need to intensify their efforts to sell

possibility that insatiable growth in these countries more in emerging markets.

will pick up some of the slack. Quite simply, we have Given these four conditions, I am more confident about

no clear idea from economic history what a 1 billion- India then China. China's growth has been predicated on

person consumer market behaves like. What we do a weak RMB and cost-based competitive advantage of

know is that there are probably around 100 to 150 companies located there. By cont rast , India' s

million Chinese middle class consumers and a smaller development, while having a significant export focus,

number in India who could continue to consume has also been based on rapid growth in domestic

products while the developed countries are licking demand in the major cities of the country. I am even less

confident about Brazil and Russia. Just this week,

President Lula da Silva in Brazil referred to the Wall

Street meltdown as “Bush's problem”. News for

President Lula: it's become everyone's problem! Russian

prosperity is based on commodity price appreciationtheir wounds from this collapse. We will expect this

(notably oil and gas). With a relatively undiversifiednumber of middle class consumers to grow in the BRIC

economy and stagnant population growth, I'm not surecountries.

that Russia can really help (unless Gazprom decides to

cut gas prices this winter and beyond to help WestWhat is key here are the following. First, export-led

European economies – don't hold your breath).companies in the BRIC will need to re-orient their

strategies towards their domestic market – a task

As a final thought: the difference between Indians andeasier said than done and one that will take some time.

Chinese buying more of their own products and servicesBut if they want to avoid a collapse in their sales, they'll

to prop up the world economy and Asian and Middleneed to do just that. Second, in the immediate term,

Eastern investment funds buying developed countrythey'll have to cut prices to their export markets

companies is obvious. The first implies breathing roombecause falling incomes in the developed countries

for the Europeans and Americans while the latter implieswill necessitate this. Third, developed countries must

a wholesale shift in economic power and ownershipresist the temptation towards protectionism in the

from the North to the South.

W i n t e r 2 0 0 8 | 2 3T r a n s - n a t i o n a l V o i c e



In recent months there have been rapid reactions workers entering the labour market. Unemploymentfrom various nations in order to save their financial may hit all-time new lows in coming months as

systems. Global negligence would inevitably lead to a financial firms declare bankruptcy or are taken over

global economic recession. With the United States in by their more fortunate rivals. China is facing similar

the thick of elections over the past months, countries problems. Whilst the government cuts interest rates

have often had to take the first step forward to ensure and the stamp price on share purchases post the

that money is safe. Ireland and Greece recently Olympics, unemployment seems to be on the rise as

guaranteed that all savings would be untouched. This infant competitors fail to receive orders from the

angered their EU neighbours as their own citizens West, where expenditure is declining. These are

may look to transfer money to a place where their indications of the Chinese economy slowing down

money is safe. drastically. Russia on the other hand has faced few

difficulties as very few Russians own shares. However

As markets continue to plunge due to a widespread the rapid changes in markets has led to the closing of

fear amongst investors of a global recession, markets for up to 48 hours at times in mid October.

governments battle hard to restore investor

confidence by regulating economic policies and A pessimistic wave has engulfed investors across the

injecting large sums of money into the economy. In globe in the light of what they fear may be a global

India the Reserve Bank of India has slashed Cash recession. Banks are largely unable to provide loans

Reserve Ratios in order to release large sums of in the West. As a result, governments have made it

money into the economy and in turn improve their top priority concern to bring these firms out of

liquidity. Japan on the other hand has been debt by purchasing their problems and reducing

withholding large sums of cash in order to dilute interest levels. This in turn will allow for more credit

losses that they fear have not been calculated yet for borrowers. Credit was the ingredient of this

post the collapse of Lehman Brothers. This in turn has downfall, and ironically it appears to be the sole cure;

regulated loans and hampered economic activity. In however at the price of innocent tax payers.

London the primary concern is the number of skilled

Continued from page 4

2 4 T r a n s - n a t i o n a l V o i c e | W i n t e r 2 0 0 8

trans-national voice issue 1

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