Haas NewsWire

Haas NewsWire, November 4, 2002

UC Berkeley Chancellor Tien Dies at 67
Faculty Profile: Teck Ho Blends East and West in Concepts of Competitive Strategy
Big Game to be Celebrated in Berkeley on November 23
Faculty News
Haas in the News
Happening at Haas

Haas NewsWire Archive
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UC Berkeley Chancellor Tien Dies at 67

Chang-Lin Tien, who, as chancellor of the University of California, Berkeley, from 1990-97 was an outspoken supporter of equal opportunity in higher education and who preserved the campus's preeminence despite a prolonged state budget crisis, died Tuesday, October 29, at Kaiser Permanente Hospital in Redwood City. He was 67 years old.

One of the most popular and respected leaders in American higher education and an engineering scholar of international renown, Tien spent nearly his entire professional career at UC Berkeley. He was the campus's seventh chancellor and the first Asian American to head a major research university in the United States.

"Chang-Lin was an exceptional leader during one of UC Berkeley's most challenging periods, a time of severe budget cuts and political changes," said UC Berkeley Chancellor Robert M. Berdahl. "His energy and optimism, his willingness to fight for the principles he cherished, and his loyalty and love for this campus made it stronger and better."

In September 2000, Tien was diagnosed with a brain tumor and suffered a debilitating stroke during a diagnostic test. He never regained his health and retired from his many duties on June 30, 2001.

Tien is survived by his wife, Di-Hwa, of Berkeley; a son, Norman, a professor of electrical and computer engineering at UC Davis; and daughters Phyllis, a physician at the University of California, San Francisco, and Christine, the deputy city manager of Stockton. Tien also leaves four grandchildren.

A campus memorial service will be held Thursday, November 14, from 3:00 to 4:00 p.m. at UC Berkeley's Zellerbach Hall.

For more on Chang-Lin Tien's life, go to the UC Berkeley web site at: http://www.berkeley.edu/news/media/releases/2002/10/tien.html.

Memorial gifts to honor the former chancellor may be made to the Chang-Lin Tien Center for East Asian Studies. Checks, payable to the UC Berkeley Foundation, may be sent to Vice Chancellor, University Relations, University of California at Berkeley, 2440 Bancroft Way #4200, Berkeley, CA 94720-4200. For more information on the center or to make an online contribution, see http://www.urel.berkeley.edu/tiencenter.

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Faculty Profile:

Teck Ho Blends East and West in Concepts of Competitive Strategy

Trained in decision sciences, marketing professor Teck Ho borrows from the timeless principles of Chinese philosophy and the systematic experimentation in game theory to illustrate how today's managers can gain from the strategic analysis of their own and their competitor's situations.

Ho joined the Haas School this fall as the William Halford, Jr., Family Chair in Marketing. His research focuses on strategic decision-making, retail management, and new product development.

As Sun Tzu wrote in The Art of War 2400 years ago: "One who knows the enemy and knows himself will not be endangered in a hundred engagements." Taking the art of war to the battles of business, Ho presumes that people who can forecast what others will do can always beat the competition.

"To the Chinese, knowledge is the ability to trace out or unravel a strategic situation," says the native Singaporean, whose work examines the application of game theory to competitive strategy.

Using a series of simple games, Ho teaches managers about the optimal decision-making behavior to improve firms' decision-making ability in competitive situations, such as price setting and market entry. The optimal choice, he says, depends on the individual's best guess of others' reasoning ability and likely action. The ability to forecast others' behavior can be learned, Ho has found.

In one of Ho's strategy games, he offers a $20 prize to the individual who can pick the number between 0 and 100 that is closest to the average number picked by its group and then multiplied by 0.7. Ho selects groups to comprise individuals with a similar "strategic IQ" (based on profession and level of education), such as a group of CEOs or a group of Ph.D. students. Ho has found that the levels of reasoning vary across profession, education levels, and culture.

The exercise forces the players not only to choose a number close to the average and subtract 30%, but also to anticipate what number their opponents will pick. Players who do not take into account that this process lowers the target number to anywhere from 22 to 28 on average lose, as do those who overestimate their opponents reasoning ability by choosing a number well below that general average.

This and similar strategic games allow Ho both to collect data on players' behaviors in competitive situations and to teach managers to analyze their own strategic options and those of their competitors. He has applied these games to teach managers in executive programs at Wharton and plans to do so at the Haas School in the future.

Ho and fellow Haas professors Barbara Mellers and John Morgan, together with Nobel Laureate George Akerlof of the economics department, are planning to set up a behavioral lab that will allow for the systematic analysis of behaviors in competitive situations.

Ho is also interested in improving managerial decision-making in retail and new product development. For example, he studies how supermarkets set price format, determine traffic, and manage shelf space to ultimately lead to more traffic and more purchases.

Retail management requires being able to predict what consumers will buy. He has developed a model drawing on consumers' previous purchases, price factors, features (advertising), and special displays that has served as an effective predictor in this area. The model helps supermarket managers to offer the right assortment at the right price to maximize a store's profits.

Even new product development is an area that has much to gain from decision science and forecasting models. Ho uses surveys and focus groups to forecast new sales for companies such as Campbell's Soup Company, which introduces many new line extensions in the soup category every year.

Ho developed a system for forecasting sales of line extension based on data from past launches of new products. He found that the research and development departments play an even greater role in the success of introducing a new product than previously assumed. "It all goes back to R&D," he says. "R&D has to get involved in the communication process at a very early stage because it is difficult to translate concepts into physical products."

Ho earned his undergraduate degree in electrical engineering and a master's degree in computer and information science at the National University of Singapore. He also received a master's and a Ph.D. in decision science from Wharton. Before joining Haas, he held an assistant professorship at UCLA's Anderson School and an associate professorship at Wharton. He serves as associate editor for Management Science and IEEE Transactions on Engineering Management.

Ho, who was a finalist for Wharton's highest teaching award, looks forward to teaching his course on pricing at the Haas School this spring. Day MBA and Evening & Weekend MBA students will learn to find data and to determine their optimal strategies in hands-on auctions and games. Ho developed his own auction software for the purpose of teaching students and managers the principles of competitive strategy.

Since moving from Wharton to Berkeley, Ho has enjoyed hiking in the east bay with his wife, Ling, and makes a point of taking his wife and children, Grace (14) and Daniel (9), to San Francisco's Chinatown for authentic Chinese cuisine at least once a week.

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Big Game to be Celebrated in Berkeley on November 23

The Haas alumni relations office is hosting a Haas School pre-game barbecue prior to the 105th Berkeley-Stanford football game on November 23 for all Haas alumni, students, faculty, and staff.

Participants must register by November 18. The cost of the event is $20 for alumni and friends, $15 for graduates from recent years (1997-2002), and $10 for current faculty, staff, and students. Register online at www.haas.berkeley.edu/alumni/biggame or by phone at 510-642-7790.

The barbecue will include all-you-can-eat chicken, ribs, hamburgers, veggie-burgers, hot dogs, salads, sodas and cookies; refreshments; and live music with Birdlegg & the Tight Fit Blues Band in the Haas School Courtyard from 10:30 a.m. to 12:30 p.m.

This year marks the 20th anniversary of The Play, the legendary football play that passed through six different Cal Bear players and led to a Cal victory in the final seconds of the 1982 Big Game. The Cal Bears are currently 5-4 for the season and will look to reverse their seven-year losing streak against the Stanford Cardinal.

The Big Game alternates every year between the Berkeley and Stanford campuses, and this year the game will be in Berkeley. To purchase football tickets, call 1-800-GO-BEARS.

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Faculty News

Dean Tom Campbell spoke at a forum titled "Restoring Corporate Integrity and Public Trust" in front of an audience of national business leaders; legal, economic and political scholars from Harvard, Berkeley, and Stanford universities; the media; and corporate representatives on Friday, November 1, in San Francisco. The event was sponsored by Attorney General Bill Lockyer of California and Attorney General Carla Stovall of Kansas, The Kennedy School of Government at Harvard University, Richard Cavanagh of the Conference Board, Walter Shorenstein, John DeLuca of the Wine Institute, and former White House Chief of Staff Leon Panetta, who served as conference moderator.

Jack Phillips, lecturer at the Haas School, gave a presentation entitled "The Role of Ethics, Wisdom, and Creativity in the Context of an Intelligent Universe" on October 28 at the Dominican School of Philosophy and Theology in Berkeley, California. The talk was part of the Dominican School's Owl of Minerva philosophy series and addressed how individual ethics fit into a cosmic order. For more information on the talk, contact Phillips at phillips@haas.berkeley.edu. For more information on the Owl of Minerva series, contact owl@dspt.gtulink.edu.

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Haas in the News

Intel President and COO Paul S. Otellini, MBA 74, was featured in the November 4 issue of BusinessWeek in the article, "No Nerd at Intel's Top? Heresy!" Read the full article at http://www.businessweek.com/magazine/content/02_44/b3806093.htm.

Terry Pearce, lecturer in the Haas School's Communications Program, was included in a BusinessWeek Online feature on "CEO Coaches" on November 4. Pearce is the executive coach for David Pottruck, Co-CEO of Charles Schwab & Co.

Severin Borenstein, the E.T. Grether Professor in Public Policy and Business Administration, commented on the energy market downturn in the November 3 issue of North County Times. Read the full article, titled "Seriously: Now the big energy companies are in trouble," at http://www.nctimes.net/news/2002/20021103/52342.html.

David Levine, professor in the Haas Economic Analysis and Policy Group, commented on the labor dispute at the ports in The Sacramento Bee on November 2 in the article, "Workers, ports settle differences over technology." Read the full article at http://www.sacbee.com/content/business/story/5039903p-6047740c.html.

Dean Tom Campbell was mentioned in The San Jose Mercury News on November 2 in an article about congressional races in the U.S. Read the full article, titled "Why state has few real races for House," at http://www.bayarea.com/mld/mercurynews/news/4428089.htm.

Severin Borenstein remarked on Governor Gray Davis' and Bill Simon's reluctance to put forth a detailed program to restore the health of California's electricity industry in the Contra Costa Times on November 2. The article, titled "Davis, Simon avoid power solutions," can be found at http://www.bayarea.com/mld/cctimes/4428754.htm.

The San Francisco Chronicle featured Chang-Lin Tien, former chancellor of UC Berkeley, who passed away on October 29. Under his leadership, the campus built several new facilities, including the Haas School of Business. Read the full article, titled "Former Cal chief dies - proponent of diversity," at http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2002/10/31/MN121089.DTL.

Haas School of Business student Sarah Takesh was featured on the KRON4 news on October 30 in the segment, "Local Woman Brings Biz to Afghanistan." In an effort to bring much needed business to war-torn Afghanistan, Takesh is building a for-profit business in which she designs clothes that are produced by abandoned and abused Afghan women. A write-up and video of the segment can be found at http://www.kron4.com/Global/story.asp?S=993493&nav=5D7lC6cX.

Severin Borenstein remarked on whether the new price cap and bid mitigation measures could discourage long-term investment in power plants in the Dow Jones Energy Service on October 30 in the article, "Calif to Begin Weeding Out 'Manipulative' Power Bids."

A new joint study by Dwight Jaffee, the Willis Booth Professor of Banking, Finance, and Real Estate, regarding insurance companies' aversion to terrorist insurance was featured in the Silicon Valley/San Jose Business Journal on October 29 in the article, "Researchers uncover reason for less terrorist insurance." Read the full article at http://sanjose.bizjournals.com/sanjose/stories/2002/10/28/daily31.html.

Janet Yellen, the Eugene E. and Catherine M. Trefethen Professor of Business Administration, was quoted in the Akron (Ohio) Beacon Journal on October 29 in the article, "Fed looks beyond Greenspan." Yellen commented on new economic policies proposed by Greenspan. Read the full article at http://www.ohio.com/mld/ohio/news/local/4393559.htm.

In a commentary about Japan's auto industry, Robert Cole, the Lorraine Tyson Mitchell II Professor of Leadership and Communication, was quoted in Bloomberg News on October 29 in "Toyota Motor's Union Apathetic About Wage Increase."

Todd Morrill, lecturer in the Lester Center for Entrepreneurship, was quoted in the East Bay Business Times on October 28 in the article titled "Firm hunts down drugs to develop." The article regarded BioMedicines Inc.

Dean Tom Campbell, along with attorney generals from four states, appeared as a panelist at a conference in San Francisco focused on how to restore public integrity and public trust in the business world on November 1. The story ran in the Silicon Valley/San Jose Business Journal on October 28 in the article, "Corporate integrity to be mulled by top politicos, biz bosses." Read the full article at http://sanjose.bizjournals.com/sanjose/stories/2002/10/28/daily17.html.

Janet Yellen published an article titled "Government needs a return to fiscal discipline" in the Times Union (Albany, New York) on October 27. Yellen discussed the falling expectations of a quick economic recovery.

Cynthia Kroll, senior regional economist at the Fisher Center for Real Estate and Urban Economics, was quoted in the San Francisco Business Times on October 25 in an article regarding possible consequences of the Dougherty Valley project. The article, titled "A city from the ground up," can be found at http://sanfrancisco.bizjournals.com/sanfrancisco/stories/2002/10/28/focus1.html.

Discussing the possibilities for "distributed generation" in the California energy markets, Severin Borenstein was quoted in the Silicon Valley/San Jose Business Journal on October 25 in the article, "Santa Clara to test the effect of independent power plants." Read the full article at http://sanjose.bizjournals.com/sanjose/stories/2002/10/28/story7.html.

An East Bay Business Times article about the east bay's housing market quoted Cynthia Kroll on October 25. Read the full article, titled "Housing biz stretched by competing forces," at http://eastbay.bizjournals.com/eastbay/stories/2002/10/28/focus2.html.

On October 20 Janet Yellen was quoted in The New York Times in the article, "Cheap Mortgages, Expensive Debt." Yellen looked at the differences between the stock market bubble and the housing market.

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