Living Business Leadership Experience
-By Tara Cavanaugh
In New Course, Students Navigate the Ambiguity of Running a Real-World Business
At a meeting in Shinola’s downtown Detroit headquarters, the executive boardroom buzzed with questions about a new product. Should it weigh less? Is the price right? How would it help meet the company’s goals?
The intensive, two-hour strategy session was guided not just by the Shinola executives in the room but also by Michigan Ross students taking part in a new course unlike any other found in business school: the Living Business Leadership Experience.
LBLE allows students to establish and lead a functional team in a real, operating business unit, work directly with executives of a sponsoring company, and learn under the supervision of faculty advisors. A pilot class last year saw students run projects for Ford and the NRP Group as well as Shinola; this year the course has expanded to seven partner organizations. It’s proving to be yet another way that Michigan Ross is revolutionizing business education.
Living Business Leadership Experience
When Kiva McGhee, BBA ’18, walked into her first day of the LBLE course last fall, she wasn’t sure what to expect. A course with both BBA and MBA students was unusual enough, but throw in the fact that the course was new, the syllabus non-existent, and executives from major corporations were sitting in the room, waiting expectantly … McGhee had never seen anything quite like it.
“On the first day, I met a ton of high-level leaders at Shinola, and that was so surprising to me,” McGhee said. “I realized we were actually getting the opportunity to work with important stakeholders” — executive-level management of a pretty unique company.
Shinola is dedicated to the rebirth of the City of Detroit in myriad ways: Its headquarters and factory are stationed downtown; workers are local and paid fair wages; and all of its watches, jewelry, and leather goods are made in the city.
For its partnership with LBLE, Shinola asked Ross students to help manage the company’s foray into electronic goods, specifically audio products. The students were divided into four functional teams — supply chain, finance, marketing, and e-commerce.
Oh, and one more thing: The students had to launch a new audio product, Shinola’s first pair of headphones, in just 11 weeks.
“I think it was a bit of a shock,” said Will Stockert, MBA ’18, who worked on Shinola’s supply chain team for the launch. “But at some point, all the teams realized that just like in any business, things need to move fast. You either complain about it or you say, ‘Let’s figure out how to add some value.’”
This is the kind of thinking that prompted students to create plans for not only the upcoming headphone launch, but for other launches and products in the future.
“Often in classes, especially in case studies, we have the expectation that there is a specific answer we’re supposed to get,” said Jennifer Zhang, BBA ’18/BMusA ’18.
Zhang worked on the finance team with Shinola. She said learning to manage the ambiguity of the project was one of her biggest ‘ah-ha’ moments. “With LBLE, our biggest difficulty was figuring out what we needed to do in order to make the product launch successful. We realized that it’s our job to anticipate what this needs.”
For example: Shinola didn’t ask the finance team for its input on pricing, but mid-semester the students suggested the price be lowered––a change Shinola made almost immediately.
Near the end of the semester, the four teams came together for one of their regular meetings with Shinola executives at their Detroit headquarters, and their work blew the leadership team away. The supply chain team presented on customer preferences and ways to produce the headphones for less cost. The marketing team shared the benefits of social media advertising and influencers, while the e-commerce team had tested how different website formats lead to a final purchase. Finally, the finance team presented two dashboards — one to analyze the performance of this launch and another to use in deciding which products to launch in the future.
“We were impressed with how thorough and thoughtful they were with their recommendations,” said Shinola Vice President of Marketing Alex Drinker.
Ambiguity isn’t always easy to deal with, but that’s one of LBLE’s biggest challenges––and lessons.
Early in the first semester, Mike Barger, AB ’86, who is leading the course, wasn’t surprised to hear about this challenge from the students. “I said to them: ‘Welcome to business.’”
Jobs of today, careers of tomorrow
Barger is the executive director of the Office of Strategy and Academic Innovation at Michigan Ross, as well as a professor of business administration. His background is in aviation, both in business as a founding member of JetBlue Airways, and as a fighter pilot for the U.S. Navy.
He even taught flight school for more than a decade. The new LBLE class is a lot like flight school.
“Both courses are basically about how to operate effectively in a complex, volatile and ambiguous environment,” Barger said. “It’s not having students memorize the playbook and then execute it. Instead, this is an experience in dealing with uncertainty and figuring out how to move the team on the right path forward.”
This is the key component of LBLE and the vision of Scott DeRue, the Edward J. Frey Dean of the Stephen M. Ross School of Business.
“We created this not only to prepare students for the jobs of today,” DeRue said, “but for the careers of tomorrow, so that they have what is needed to thrive in the future.”
DeRue first pitched the idea of LBLE to Tom Lewand, the CEO of Shinola. Lewand, AB ’91/JD ’96/MBA ’96, jumped at the opportunity.
“Shinola has a unique portfolio, and retail is especially disrupted right now. So we’re looking for all of the talent we can get. And as we’re about five years into the sales cycle, we’re very much in startup mode,” Lewand said. “So being able to draw on the expertise, talent, resources that Michigan Ross has, to help us diagnose and solve problems immediately, is a huge benefit.”
So far, Lewand has been thrilled with the results of Ross students’ work. He’s even made a few job offers to LBLE students.
“This partnership is extremely valuable to us in the near term, and infinitely valuable to us in the long-term as we look for Shinola to grow,” he said.
This Is Real Business
For the pilot year, in addition to Shinola, student teams worked with Ford on its Smart Mobility business, developing a global business plan for the unit that has autonomous driving at its core; and with the NRP Group, a Cleveland-based real-estate company, on developing a scalable business model for social and support services at affordable housing projects.
This year, LBLE has expanded even further. Engagement with the initial three companies is ongoing, and four new partnerships have begun:
Michigan Academy for the Development of Entrepreneurs - Developing a model for how to support entrepreneurs in low- and middle-income countries and build value creating tools and processes based on that approach
Daily Fuel - Creating, launching, and managing a new revenue-producing digital media business aimed at current students and University of Michigan alumni
Warmilu - Developing and executing a market entry strategy for outdoor seating products that provide warmth via Warmilu’s patented InstaWarmer technology
Michigan Business Education Navigator - in partnership with Google spin-off Gooru, designing and launching a technology tool that provides real-time navigation guidance to students looking to optimize their curricular and co-curricular experiences while attending Michigan Ross
Several students who took LBLE last fall term continued the course in the winter, including Kiva McGhee. She’s become a huge fan of Shinola — and of LBLE. “When you do a business case in class, it’s already happened. It’s in the past,” she said. “But this is different. This is real business. It’s changing constantly. It’s an amazing experience we can only get at Michigan Ross.”