Owl Have You Know

Season 2, Episode 11

Omar Matuk-Villazon, M.D., MBA '18 joins host David Droogleever to discuss the direct primary care model, innovation in healthcare and what it looks like to build a medical school from scratch.

Subscribe to Owl Have You Know on Apple Podcasts, Spotify, Youtube or wherever you find your favorite podcasts.

Updated from original post that was published on 04/01/2022.

One of the top questions we get about MBA@Rice is how do you become part of the Rice Business community if you’re taking classes solely online? If you live in or around Houston, you’ve got more opportunities to come to campus. But even if you’re far away, you still have ways to interact, get to know your classmates and professors in person, and meet alumni.

Online MBA students are required to participate in an on-campus immersion experience called The MBA@Rice Residential.* The Residential is a four-day immersion online MBA students attend, where they take elective classes in person and participate in co-curricular programming that includes:

• Kicking off the weekend with a meet-and-greet at the hotel the night before classes start – allowing students to connect before the weekend begins
• Partio
• Formal dinner with some of the deans and faculty
• Informal networking event on Saturday evening
• Information sessions with the Career Development Office, Alumni Relations and Office of Academic Programs and Student Experience
• Key guest speakers such as the university president 

Image

In addition, ask anyone at Rice Business about their favorite activity, and they’ll tell you all about Partio, our student-run party on the patio at McNair Hall most Thursdays. Partios are about connecting with classmates from all the MBA programs, professors, staff and alums. There’s music, food, beer and once a year Rice Around the World Partio goes all out so students can share meals, outfits and dancing from their home country or state.

Other once-a-year favorites for all students include the student-run Women in Leadership Conference (WILC) and Rice Energy Finance Summit (REFS). Both all-day events at Shell Auditorium are packed with speakers, business leaders and students.

Student clubs are also open to online and on-campus students and are meant to help you cultivate your leadership skills, learn more about different professions and get to know each other better. You're more than welcome to join the clubs. Meet-ups are typically held on campus and around Houston, but are occasionally virtual. With more than 30 social, professional, diversity or student government clubs, you should be able to find a perfect fit.

Rice Business Board Fellows is a way for students to gain experience serving on a nonprofit board while giving back to our communities by applying their MBA knowledge, skills and perspectives to pressing challenges in nonprofit organizations. With leadership from enthusiastic and committed online students, we’ve expanded the Board Fellows opportunity by recruiting new nonprofit partners and shaping the service commitment for the MBA@Rice quadmester calendar. With our online MBA community living across the U.S., we hope to expand our reach outside of Houston and have already secured an opportunity in Nashville, Tenn. We’re looking for additional nonprofit partners in cities where our students live and will update students on board service opportunities near them and the application process.

Image

MBA@Rice students are also invited to participate in Rice Business Gives Back, a student service-learning program that allows students, faculty and staff to give back to the local Houston community. Leadership is comprised of student leaders who lead different projects. After completing service projects, all groups congregate for food and drinks to celebrate their morning of service.

We listen to our online students about ways to deepen their connections and have new initiatives in the works: a quarterly happy hour for the online students in different cities with current classmates and alumni is planned, and an online student association spearheaded by a group of enthusiastic and committed student leaders is on track to be official this spring. This student association is designed and structured specifically for online students and lays the foundation for long-term student engagement, advocacy and programming.

The most important thing to remember is that we’re here for you. We want to know how to make this experience the best for you, your career, your family and your future. We will always listen and we value your questions and input. Let us know how we can help.

*Students pay $1,000 for the Rice Residential weekend and this includes hotel, most meals and transportation to and from campus.

Explore Our Rice MBA Programs

A total of 19 graduate programs at Rice University rank among the nation's top 25 in their categories in the latest edition of U.S. News and World Report's "Best Graduate Schools."

The high rankings run the gamut of graduate programs offered at Rice, including the No. 1-rated industrial organizational psychology program in the nation.

The George R. Brown School of Engineering, which ranks No. 27 nationally (up from No. 29 last year), has six programs or specialties in the top 25: bioengineering (No. 9, up from No. 10), chemical engineering (No. 24, up from No. 26), computer engineering (No. 20), electrical engineering (No. 25, up from No. 27), applied mathematics (No. 14) and environmental engineering (tied for No. 16). Other Rice Engineering programs ranking in the top 30 are civil engineering (No. 26), materials engineering (tied for No. 27) and mechanical engineering (tied for No. 29).

The Jesse H. Jones Graduate School of Business, which ranks No. 27 nationally, has two programs in the top 25: entrepreneurship (No. 10) and the professional MBA program that U.S. News ranks in its part-time MBA category (No. 11, up from No. 17). Its executive MBA program ranks No. 31.
 

"The caliber of graduate programs at Rice keeps getting stronger and continues to draw a more robust and diverse graduate student population at the university," said Rice Provost Reginald DesRoches. "We are pleased that programs across our entire campus are being recognized and look forward to growing this area of our mission for years to come."

The U.S. News and World Report rankings are among the most closely monitored annual surveys of the nation's institutions of higher education. Each year, the publication ranks professional school programs in business, education, engineering, law, medicine and nursing, including specialties in each area.

Rice's Department of Chemistry, which ranks No. 35 nationally, has three programs in the top 25: theoretical chemistry (No. 11), physical chemistry (No. 17) and organic chemistry (No. 22).

Rice's Department of Computer Science, which is tied for No. 28 overall, has two programs in the U.S. News rankings: computer programming language (No. 22) and computer science systems (tied for No. 26).

Rice's Department of Earth, Environmental and Planetary Sciences is tied for No. 24 overall nationally in the Earth Sciences category and has three programs ranked in the top 20: geochemistry (tied for No. 14), geology (tied for No. 18) and geophysics and seismology (tied for No. 12).

Rice's Department of Mathematics is tied for No. 29 overall.

Rice's Department of Physics and Astronomy is tied for No. 28 overall in the Physics category and has two programs in the top 25: atomic/molecular/optical (No. 8) and condensed matter (tied for No. 22).

U.S. News says its Best Graduate School rankings are based on expert opinions and statistical indicators measuring the quality of faculty, research and students. The publication says it compiled data from surveys of more than 2,150 programs and reputation surveys sent to more than 23,000 academics and professionals in fall 2021 and early 2022.

For more information on Rice's rankings, click here .

New paper examines decade of studies to identify best team design

Organizations trying to create cultures of innovation increasingly turn to teams of employees instead of individuals, but there have been few studies on how to build teams for best results. Now a new paper incorporating decades of research offers insights on the best way to design innovative teams.

“Teams, often over individuals, are expected to be problem-solvers, but there’s currently more research focused on independent creative idea production and implementation,” said Jing Zhou, the Mary Gibbs Jones Professor of Management and Psychology at Rice University’s Jones Graduate School of Business. “There’s much that’s unknown about group dynamics’ effect on team innovation.”

Zhou and a group of her fellow researchers set out to discover how different aspects of team design — composition, task structure, management support — relate to creativity and innovation. They conducted a meta-analysis of 134 field studies representing 11,353 employee teams and 35 student studies representing 2,485 student teams. Their newly published paper on the topic is entitled, “Building blocks of idea generation and implementation in teams: A meta-analysis of team design and team creativity and innovation.”

“Because a single primary study tends to contain measurement or statistical limitations and noises, a meta-anlaysis tends to do a better job in revealing true relations among variables than any single primary study included in the analysis,” Zhou said.

The authors found the best practice is to not only give teams autonomy, but also structure them to work interdependently — in other words, make their tasks and goals interconnected and aligned rather than siloed

“This relationship is more positive when leaders emphasize the autonomy of the team than when they emphasize the autonomy of the individual team members,” the authors wrote. “In contrast, we found that leaders who restrict (team) control inhibit team creativity and innovation.”

The study also found that demographic diversity did not have a direct impact on team creativity. But there was a correlation between job-related diversity and creativity.

“Contrary to our expectation although similar to our findings for the field studies, demographic diversity has near-zero relationships to team creativity,” according to the study. “It could be that cognitive processes such as diverse perspectives and information elaboration — rather than social or motivational processes — account for how job-related diversity enhances team creativity and innovation.”

Though the study did not find a direct relationship between demographic diversity and team creativity, it found a moderated relationship in collectivistic cultures such as China and South Korea that wasn’t found in individualistic cultures such as the United States and the Netherlands.
 

“Values based on collectivism or individualism are likely to influence how team members think, relate to one another and regulate their behavior toward shared goals — that is, teams’ cognitive, social and motivational processes,” Zhou said.

Zhou argues that teams that are more creative have greater rates of collaboration and team potency — the shared belief that they can be effective.

“Task and goal interdependence are positively related to team creativity and innovation,” she said. “This shows the importance of structuring tasks so that team members work toward common goals. It’s likely this increases creativity by facilitating and encouraging cooperation.”

Co-authors are Kris Byron of Georgia State University, Sejin Keem of Portland State University, Tanja Darden of Towson University and Christina Shalley of the Georgia Institute of Technology.

By Professors Jim Krane and Mark Finley, originally published in The Conversation

When a power plant runs on coal or natural gas, the greenhouse gases it releases cause harm – but the power company isn’t paying for the damage.

Instead, the costs show up in the billions of tax dollars spent each year to deal with the effects of climate change, such as fighting wildfires and protecting communities from floods, and in rising insurance costs.

This damage is what economists call a “negative externality.” It is a cost to society, including to future generations, that is not covered by the price people pay for fossil fuels and other activities that emit greenhouse gases, like agriculture.

To try to account for some of the damage, federal policymakers use what’s known as a “social cost of carbon.”

A tug-of-war over the social cost

The social cost of carbon, a dollar figure per ton of carbon dioxide released, is factored into the costs and benefits of proposed regulations and purchasing decisions, such as whether the Postal Service should buy electric- or gasoline-powered trucks, or where to set emissions standards for coal-fired power plants.

That extra social cost can tip the scales for whether a regulation’s costs appear to outweigh its benefits.

The Trump administration slashed the social cost to between $1 and $7 per metric ton of carbon dioxide – low enough that the administration could justify rolling back EPA regulations on power plant emissions and vehicle fuel efficiency.

The Biden administration temporarily raised it to $51, close to its pre-Trump level, and has been preparing to finalize a new social cost that might encourage regulators to push for emissions cuts in everything from agriculture to transportation to manufacturing.

However, how and where new cost estimates are deployed is up in the air. A Trump-appointed federal judge in Louisiana issued an injunction in February 2022, blocking Biden’s interim increase. A federal appeals court then on March 16, 2022, allowing the higher social cost of carbon to again be used while the government appeals the Louisiana ruling.

What social cost means for you

One of Joe Biden’s first actions as president was to reverse the Trump administration’s bargain-basement accounting of the “social cost.” The Biden administration returned it to the Obama-era level, adjusted for inflation, by setting an interim social cost at $51 per metric ton of carbon dioxide that would rise over time.

If that were a carbon tax paid by consumers, it would raise gasoline by about 50 cents per gallon.

But the social cost of carbon has no direct effect on the price of gasoline, electricity, or emissions-intensive goods like steel. Instead, it influences purchasing and investments by the government, and indirectly, by private companies and consumers.

A higher social cost of carbon signals to companies that the government sees big benefits to cutting greenhouse gas emissions. Figuring in damage from emissions also helps it justify investments in green technology.

For instance, the U.S. Postal Service has asked Congress to approve $11.3 billion for a new fleet of gasoline-powered mail delivery trucks. Those vehicles would burn through 110 million gallons of gasoline a year. At $51 per ton of emitted carbon, that purchase implies a social cost of $1.1 billion over 20 years. Incorporating such costs might push the government to consider including electric vehicles in the future postal service fleet.

Currently, economists calculate the social cost by using integrated assessment models that bring together long-term projections for population, economic growth and greenhouse gas emissions. These models use emissions scenarios to estimate future climate change, and then calculate the effects on the country’s – and the world’s – GDP, and they can vary widely depending on the assumptions used.

For example, damage estimates for 2100 produced by the three models currently used in the government’s cost-setting process range from $80 to $290 per ton. The Biden administration set the interim social cost to rise to $85 by 2050 to account for greater impact of climate change over time.

Using models to produce such estimates have become a routine part of policymaking, but they are also massively uncertain.

Why Trump’s social cost was so much lower

The Trump administration’s estimate was lower for two reasons: It accounted for climate damage only within U.S. borders; and the administration placed a lower value on future costs by setting a discount rate of 7%, more than double the 3% used by Obama and Biden. Economists use different rates to “discount” future benefits versus the cost we pay today to get there. A high discount rate on climate means we put a lower value on damages that occur in the future.

Unsurprisingly, discount rates are contentious. New York state uses a 2% discount rate to produce its current social cost of carbon of $125 per ton. Some analysts argue for a 0% discount rate because anything higher places a lower value on costs borne by future generations.

The federal judge in Louisiana agreed with the argument put forth by that state’s Republican attorney general that global damages could not be considered in social costs tailored for U.S. regulations. However, the appeals court, in , wrote that Louisana and other states’ claim in the lawsuit was based on “a generalized grievance” and their claim of injury “stems from any forthcoming, speculative, and unknown regulation that may place increased burdens on them” rather than the interim estimates. A similar lawsuit in Missouri was dismissed.

Some scholars debate whether a social cost of carbon should be used at all.

The United Kingdom uses a “cost effectiveness analysis” instead to determine the value of carbon removal. That method uses a target – net-zero emissions – and calculates the cheapest route to get there. Some prominent scholars are recommending the U.S. adopt the U.K. approach, while others object.

Other options: Carbon taxes and emissions caps

There are other ways to account for the costs of climate change.

A carbon tax is more straightforward and effective, but tougher to enact because it requires Congress to act. Such a tax would dissuade people from burning fossil fuels by taxing them for the damage those emissions cause – the negative externality.

Another form of carbon pricing uses a marketplace for companies to trade a declining number of emissions permits. Such cap-and-trade programs are in place today in the European Union, a few U.S. states, including California and Washington, and elsewhere.

Taxes and emissions caps would reduce carbon emissions, but they are unpopular with voters and Congress because they raise prices. A social cost of carbon is easier both to enact and to modify through regulatory review, without legislation. It allows the government the flexibility to address climate through routine policymaking – but can also be changed by subsequent administrations.

This article was updated March 17, 2022, with an appeals court staying the injunction.

Jim Krane, Fellow for Energy Studies, Baker Institute for Public Policy; Lecturer, Jones Graduate School of Business at Rice University and Mark Finley, Fellow in Energy and Global Oil, Baker Institute for Public Policy, Rice University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Based on research by Vikas Mittal

When a fast-casual restaurant chain started to see stagnating sales, the company’s CEO came up with a solution: adding new, higher-quality menu items. 

To validate his thinking, he informally interviewed a few dozen diners at different locations, asking them how they would feel about more and higher-quality menu items. After getting enthusiastic responses from several customers, he went ahead with his plan. Sales fell further.

So what went wrong? Systematic surveys showed that what created the most value for customers was a fast dining experience with a short wait time, a simple menu with a few items, ample parking and a bill under $12 per meal. Higher quality and an expanded menu did not correlate at all with customer value. Where the company’s CEO went wrong was by relying on salience instead of importance. 

Salience refers to factors that are top-of-mind and easy to recall, which become prominent and are then incorrectly prioritized. A classic example is a 1979 study that surveyed people about their perceived risk of dying from causes like drowning, murder or cancer. The study’s authors found that people thought they were more likely to die from causes that were mentioned more often in their local news, such as murder, when in fact they were at much greater risk of dying from common but less prominent causes such as cancer. 

The CEO made food quality and expanded offerings salient to himself by talking about them to a small group of customers. It was an easy way for him to feel good about his efforts. But, like many executives, he relied on salience. 

Salience is easy and convenient, but it’s also the curse of decision-making. It simply reinforces executives’ prior beliefs rather than diagnosing the true cause-and-effect relationship. Imagine if a doctor saw a patient with stomach pain and recommended an appendectomy because a patient she’d seen the day before needed one. Or if the doctor asked the patient to recommend the treatment himself. Patient outcomes would likely falter and the doctor would go out of business (and perhaps lose her medical license).

Thankfully, doctors don’t operate this way. They rely on the statistically measurable relationship between critical inputs and outputs for decision-making. So should senior executives and CEOs.

Informal customer conversations draw primarily on gut feelings, hunches and top-of-mind ideas, and as such, aren’t reliable indicators of true customer value. Like all of us, customers often tailor their responses to the audience they’re addressing. So a company’s vice president of service might speak with a customer who says they love the service, while the same customer might tell an HR executive they love the employees and then go on to tell the VP of sales that they would like lower prices. These on-the-spot responses typically have no significant impact on or statistical correlation with customer value, which ultimately drives sales and profits.

To craft a successful strategy, executives need to use a systematic, statistical process that starts with choosing a clear outcome or output, such as customer value or employee retention. The next step is to measure inputs that drive that output, and then quantitatively correlate each input to the output. Only those inputs that drive the desired output should be included in the company’s strategy. 

Take, for example, a nursing home that attempted to craft a strategy for decreasing employee turnover. Relying on casual conversations with a few dozen employees, executives assumed higher pay would increase retention. They were wrong. 

When they statistically correlated multiple inputs — higher pay, health benefits, supervisor respect, promotion opportunities and paid vacation — with retention, they realized their intuitive leaps had been incorrect. Only health insurance and promotions were correlated with increased employee retention. Higher pay had no effect. 

Committing to this type of systematic review to drive strategy requires humility on the part of senior executives. The nursing home executives were able to look past their own assumptions and learn from this type of statistical analysis, recognizing the limits of salience-driven thinking and deferring to algorithms that could better predict the inputs of turnover than they could.

Doctors understand this as well. To treat their patients, they rely on data from groups like the Food and Drug Administration or the National Institutes of Health, which run clinical trials and rely on data, statistics and an infrastructure of knowledge.

Unfortunately, many senior executives lack humility when it comes to strategic planning. They equate decades of salience-laden thinking with a deep understanding of correlations between inputs and strategic outputs. They might think, “I’ve been in this industry long enough to know what works,” or “Since this worked then, it will work now as well.” But more often than not, relying on salience-laden intuition alone will not achieve the desired outcome. 

“Focus: How to Plan Strategy and Improve Execution to Achieve Growth” lays out specific steps for senior and mid-level executives who want to follow systematic, statistical processes to drive their company’s strategy.

Image

Vikas Mittal is the J. Hugh Liedtke Professor of Marketing at the Jones Graduate School of Business and author of “Focus: How to Plan Strategy and Improve Execution to Achieve Growth.”