There’s Luca from Italy who reports Italians are used to a slow economy and he is still selling high-priced trips to affluent compatriots.  David from Ireland tells of large European choral and agricultural groups still going strong.  Student tour operators, who recently met in Colorado Springs, seem to agree that numbers are not dropping for 2009. (Parents continue to make their offspring a priority!)  Midwestern U.S. tour operators credit the fiscal conservatism of their demographic for a steady influx of business.

The energy and enthusiasm that pervades the travel industry was as present as ever in this group–whether wandering the streets of Savannah in search of pirate treasure (!) or sharing ideas in small group or plenary meetings. An outside observer would never doubt that we all love what we do and put our hearts into every endeavor.

It is this positive spirit and passion for travel that will see us all through yet another challenging period in our industry’s history. The human spirit loves to explore, connect and experience new sights and sensations. And we–tour operators, hotels, CVBs, DMOs, and travel suppliers–stand ready and able to fulfill that undeniable human urge–now and well into the future.

Hello, Friends of ATA!

It’s been a while since I last posted anything.  I received wise advice–don’t blog unless you have something to say.  Since my return from Harvard, I have been immersed in day to day management, while applying some strategic lessons learned from HBS to better lead the company toward a strong and bright future.  And while these steps may be exciting to me and my colleagues, I question their interest to others, so I have spared you any hum-drum blogging.

Then an event took place that inspired me.  I attended the annual NAFSA conference here in Washington, D.C.–and thought it was worthy of note. NAFSA (formerly the National Association of Foreign Student Advisors, and now simply an obsolete acronym) is the association that brings together those in the university setting who receive and counsel foreign students and those who are involved in sending American students abroad for study.  Here is their official mission statement:

NAFSA serves international educators and their institutions and organizations by setting standards of good practice, providing training and professional development opportunities, providing networking opportunities, and advocating for international education.

I attended NAFSA as part of ATA’s CET Academic Programs (www.cetacademicprograms.com) team.  CET Academic Programs is ATA’s study abroad division, which represents about 30% of ATA’s total business.  (We acquired CET in 1993 and have grown the program by 10 fold since then.) We (CET) had a booth and a larger than usual presence, as NAFSA is not usually in our hometown.

Sessions featured varied topics, ranging from Policymaking for International Education and Coming Out Across Borders (Outcomes of GLBT Study Abroad Experiences) to Helicopter Parents and an Author Series featuring well-known writers on international experiences. In all, the conference was to have over 9,000 in attendance from the U.S. and over 100 countries and took place in the D.C. Convention Center. The parade of booths rivaled World Travel Mart in London with Spain’s presence being the most impressive in size.

While most conference attendees might skip the plenary sessions, I decided that it might be worth checking out, given that Judy Woodruff, once of my favorite journalists, was moderating. I was right. It was one of the most worthwhile sessions of the day. In addition to Judy Woodruff, the following individuals participated, representing a broad array of perspectives, and explored the conduct and goals of public diplomacy, with an emphasis on the vital role of international education:

The panelists discussed topics such as the forms and outcomes of public diplomacy used by the United States in the last 60 years; the relationships between foreign policy and public diplomacy during that period; and the impact international businesses has had on cross-cultural understanding and the creation of the “flat world.”  Questions like “What role does international education play in building understanding across cultures and national boundaries?” and “What is the future of public diplomacy in the 21st century?” were asked.

The debate was heated.  Shash Tharoor presented eloquently on his position, speaking on the image and brand of the U.S. abroad and how it needs to change.  Hisham Melhem objected strenuously to the term “brand” with regard to a country’s image, as it implied it was all about “spin.” (He admitted he was not a marketer or business person, but trained in philosophy).  He emphasized that, in order to change its image, the U.S. needed to take action and let its actions speak for themselves.  This was not a case where “re-branding” and “spin” would be effective, he contended.

Keith Reinhard, a successful business man, has established a nonpartisan, nonprofit organization dedicated to reversing the decline in America’s standing in the world and improving relations between Americans and people from other cultures (http://www.businessfordiplomaticaction.com). Mr. Reinhardt cited the Pew Global Attitudes Project released in June 2006.  In this document, 15 nations were surveyed to gauge their attitude to the U.S.  Though anti-Americanism had abated somewhat in 2005 as a result of the aid offered up by Americans to Tsunami victims and elsewhere, our ranking dropped significantly in most of the countries surveyed.  For example, since 2000, Great Britain’s view of the U.S. went from an 83% favorable rating to 55%, while Indonesia (a largely Muslim country) went from a 75% to 30% favorable rating.  As Mr. Reinhard’s website states:

While it is true that much resentment of our country currently centers on our foreign policy, much does not. Other root causes include the perception that we are arrogant and insensitive as a people, that our culture has become all-pervasive, and that the global business expansion on the part of U.S. companies has been exploitive.

I think that one of the best lessons for those in attendance was provided by Shashi Tharoor, former Under-Secretary-General of the UN. He offered the following anecdote to illustrate the importance of cultural perspective.

An American farmer visits a farmer in India. The American asks his Indian counterpart where the boundaries of his farm lie.  The Indian farmer proudly points to the river visible not too far in the distance–”that’s my western boundary, and that” he says pointing to the trees nearby, ” is my eastern boundary.” He completes the demarkation of the farm by indicating the farmhouse behind them and the shed out in the distance ahead of them.  When done, the Indian farmer asks the American, “And how big is your farm?”  The American says, “Well, I get on my tractor and I go two and a half hours east and I reach the eastern boundary. Then I turn right and drive another three hours to the south and hit my southern border, and I turn right again and ride my tractor another two and a half hours north to my northern boundary, and finally I turn right again and drive another 3 hours back to the farmhouse. Just in time for dinner!”

The Indian farmer nods his head knowingly and says “I used to have a tractor like that.”

With (very) warm regards from steamy Washington, D.C.,

Kate Simpson

President, Academic Travel Abroad

On April 17, the OPM37 class of over 150 graduated. It was a gorgeous spring day in Boston and we were thrilled to have our friends and family in attendance.  One of the highlights of the ceremonies was our key-note speaker, Robert Kaplan, interim CEO of the Harvard Management Company and our class Leadership professor for the first two years.  Naturally, he was unable to teach OPM37 this spring, as the call of Harvard’s $42 billion endowment was a little more pressing a  priority than our business education!

Rob is an incredibly impressive individual.  Our first year at OPM was his first year teaching this particular program.  We could tell he was a bit nervous, but it didn’t take him long to prove he was a natural teacher.  He listened, he engaged, he challenged and he laughed.  Not to mention that his career has been a series of fantastic accomplishments that most of us can only dream of, so this adds an infinite degree of credibility to his teaching.

Rob began his address by telling us a little about what he does to manage the $42 billion Harvard endowment.  I worried I would soon tire of this topic, but Rob made it fascinating. He did note that currencies were an area that left him often confused–validating the frustration many in our industry face!  He moved on to the financial crisis currently facing our country, and assured us it would be solved. But, he warned, this was only a temporary solution.  The underlying, root problem in the United States lay in our leaders ignoring critical facts: that the middle class has been losing economic ground steadily for years and that there are 50 million uninsured citizens.  Someone in the audience asked whether Rob was intimating that this year’s election needed to go in a certain direction. “Yes, this election matters. It matters a lot.”  Rob avoided endorsing a particular political candidate, but it was clear on which side of the fence he stood.

He ended his address with a compelling and inspirational statement: “Most of you have not done what you will some day be known and celebrated for.”  He wanted us each to consider what contributions we can make to our world, our communities and our field.

So I left Harvard shortly after the ceremony and headed to New Orleans to participate in the clean-up of Louis Armstrong Park with several ATA team mates.  (See the youtube video on our main blog page.) Not a great contribution–but a start?

Kate Simpson

I admit I have escaped back home on weekends to get a dose of husband and children during this 3-week stint.  It does one good after living the life of a student–studying until all hours, discussing hot topics with classmates in and out of class, and generally feeling disconnected from the real world, cooped up on a lovely Ivy League campus.

As I was flying home this past Sunday evening, the plane was quite full, but needed some redistribution of weight from the back to the front.  So I was one of the volunteers who moved forward 15 rows and settled in to read my case studies for Monday morning.  The case was about Common Angels, an angel investor group here in Boston.  Along with it, we were assigned two business plans to assess as though we were members of Common Angels.  As I finished one business plan and picked up the other, the woman across the aisle from me asked “May I see that case?”  I passed it to her, she leafed through it quickly and passed it back, saying “that’s my husband’s company.”  We were both incredulous. In fact, so were the women on either side of us.  What are the odds?  Of course, I ended up hearing far too much “inside information” to fairly participate in the class the next day (I was even shown photos of their two children–3 and 6!), but it was fascinating to hear the perspective of the spouse.  The business sells a new software/hardware concept in the architecture-engineering-construction field, allowing blueprints and other documents to be stored on a rugged tablet PC upon which people in the field can take and save notes and send back to the office, ensuring fast and efficient transferring of data from field to office and vice versa. Upon landing, the wife calls her husband and says “Honey, you’re not going to believe this, but I was sitting next to this woman and she was reading your Harvard case study!”  Turns out her husband was coming to class the next day.  In the end, it was an intriguing look at how a concept went from theory to reality and what it took for it to get to a 30-person, successful business today.  Investment aside, It takes a very supportive and committed spouse!

Yesterday, we had two equally enticing cases: Google Advertising and Urban Video Game Academy.  The first showed us why Madison Avenue really has a lot to worry about with Google on the scene.  While Google’s secret is clearly the beautiful simplicity of its search engine, we found that very strength masked its efforts to diversify.  Many of us didn’t realize you can use Google to organize your photos, buy books, write blogs, check out the stock markets, search patents, and more.

The Urban Video Game Academy was a great case to end the session.  It was about a passionate teacher in the Baltimore-DC area who had realized there was a need to create more positive role models in video games for minority children and that under-privileged children spent much of their time in front of screens, affecting their achievement and ability to advance in their education and careers.  So he designed a curriculum to teach video game programming to these kids in after-school and summer programs. His curriculum reinforced the schools’–including science, math, English and more.  This gentleman loved to teach the kids and was confronting a key question: should he grow this organization, as demand from various schools was mounting?

Another important question posed by our professor was: is this a business?  I voted no. This was a passion, a mission. Money was not a motivation. Helping the children advance was.  If he was to grow this as a business, he would need to abdicate power and find another person who was passionate about scaling it up.  Several classmates disagreed.  Some were perplexed by why he wouldn’t want to take full advantage of this opportunity.  In the end, the professor revealed that, indeed, the founder had done nothing to grow this as a business and 3 years later was still doing what he’d been doing at the beginning: teaching a few classes himself. And loving it.

To make her message clear, our professor went on to share a personal anecdote.  Having had a very successful career, always moving upward, she came to the point when she was being offered deanships and presidencies of different colleges.  She went home to her spouse one evening and said “do I need to be Dean before I die?”  She decided not. She loved teaching too much to give it up. An important message for a classroom full of over-achievers who are programmed to grow, improve, succeed, and climb to the top. In the end, follow your heart. Even if it’s not at the top.

Tomorrow is graduation (David Parry and my husband have flown up and even attended classes today!) and then I am off to New Orleans to join Chase and several hardy ATA’ers for some volunteer work with Tourism Cares for Tomorrow.  I will wrap this up when I am back in the office next Monday.

Thanks for tuning in!  Cheers.

Kate Simpson

We’ve arrived at our final week.  We “graduate” Thursday in a full ceremony with Robert Kaplan as our guest speaker (currently Acting President and Chief Executive Officer of Harvard Management Company and formerly our OPM Leadership professor). One classmate will speak on behalf of the Americans and one on behalf of those from other countries.  Spouses, children and other family members are flying in from all around the world for the event.  The excitement is building, while many are expressing sadness at our imminent parting.

We have studied some interesting cases of late.  Chateau Margaux, the ultimate Bordeaux wine, stimulated great interest in class as we delved into whether or not Corinne Mentzelopoulos, the current thirty-something-year-old owner should consider disrupting a centuries-old distribution and marketing system (established by Napoleon III in 1855) and attempt selling her wine directly, via the internet and other avenues.  In the end, it was clear Corinne didn’t really need our help and is doing very well (considering the rest of the French wine industry).  The antiquated distribution system actually provides value in the chain–bringing cash in before the wine is mature, providing warehousing, and allowing Chateau Margaux to do what they do best, without the distraction of marketing and distribution.

Another European case followed: Real Madrid Futbol Club.  Our marketing professor was delighted when one of our Madrid classmates presented him with a team jersey with his name on it at the beginning of class (I am sure the professor, while pleased, wished he’d gotten a bottle of Margaux in the earlier class!).  He proceeded to wear it for the duration of the session–a heated one at that.  Between the Brazilians, the Chileans, the Mexicans, the Spaniards and a lonely Italian, the debate was feisty.  Soccer is more than a sport in the rest of the world: it is passion, it is life.  All admired the ascendancy of Real Madrid as one of the top revenue-generating “futbol” teams in the world, beating Manchester United for the first time in recent years.

Tune in next time to hear about our angel investing class–fascinating!

Signing off from Baker Hall dorm,

Kate Simpson

President,
Academic Travel Abroad

Since my last entry, it’s been busy!  If you recall, we had voted for the winning strategies and 20 classmates had risen to the top.  These winning strategies were critiqued during 3-hour sessions by assigned groups, then the next day each winner presented their strategy in class before their classmates, and was followed by the prepared critique of their strategy.  Each presenter had 5 minutes, carefully monitored and enforced by a forceful German-Venezuelan classmate who enjoyed his role as time-keeper tremendously.

We each voted for what we considered the strongest presentation and critique.  It was difficult!  There were many impressive contenders, including a Chinese pharmaceutical company (led by a woman!) that is now listed on the NYSE and plans on being one of China’s top 5 in a few years; an ambitious New Zealander who is jumping into the cement business; a brand new Free Trade, organic coffee producer from New England; and a high tech business whose presentation was seriously sophisticated (and a little beyond me, to be honest).  In the end, after struggling to decide between cement and coffee, I decided in favor of coffee, as the presenter’s passion came through loud and clear.

As far as cases in the past few days, we have looked at Shouldice Hospital in Canada, a hernia specialist clinic established after WW2 by a doctor who discovered early on that recovery is accelerated when the patient becomes active shortly after surgery.  His hernia repair technique proved highly successful, and he managed to create a very unique hospital where patients would come from all over the US and Canada.  He managed to infuse such a sense of well-being in the post-op recovery period that patients would reconvene for “hernia” reunions on an annual basis!  The business is still going today.

In Negotiation class, we enjoyed a 6-party exercise, where the class was divided into groups of 6 where there was a seller, the seller’s management team and four buyers.  I was one of the buyers.  We each had our own confidential role which we read through and prepared for 20 minutes. Then we spent an hour negotiating among ourselves and the seller.  The end results for the entire class were fascinating and all over the map.  The sellers were able to obtain prices between $275 million and $745 million for their company!  Now that’s quite a range.  Those that figured out that by having the buyers cooperate, there would be more value to bring to the table, ended up with the higher prices.  Alas, my group was not one of these creative ones.  We decided that, in the real world, the seller would dictate what would happen and would likely not allow the buyers to talk. Many lessons to be learned!

Kate Simpson

President,
Academic Travel Abroad

After some very late nights working on our “OAS” (Objective, Advantage, Scope) statements, we met in groups of 8 at 8:30am to review each company’s OAS, comment, question and challenge the strategy declared. In my group, we had a software provider who works with logistics companies Down Under, a Nigerian mobile bank and payment system, a Panamanian home appliance distributor, a US-Indian jewelry manufacturer and distributor, an American pharmaceutical developer, a Belgian osteopathic doctor setting up unique clincs in Italy, an Austrian software company serving the automotive industry and myself, a study abroad and educational tour provider. Our mission: to vote for what we considered the best strategy. It’s a fascinating exercise to zero in on what differentiates you from the competition and to boil it down to a couple of sentences. Here is what I came up with:

To become the leading provider of 1) study abroad programs for American college students and 2) luxury , educational group tours for top donors of American non-profit organizations. Our programs are custom-designed, built on a proprietary network of contacts, featuring experiences not available to the average traveler or student abroad, and augmented by concierge-level service. Our 58 years have solidified a tried-and-true risk and crisis management system that protects our students and adult travelers in an ever-changing world.

I voted for the Belgian doctor. Confidentiality agreements preclude me from sharing the details of his competitive advantage, but suffice it to say that he’s got a golden concept that I hope takes off.

We learned late in the day, once the votes for 20 groups were tallied, that our doctor had won within our group. So from 150+ of us down to 20. Next week, the competition is further narrowed. In the end, there will be only two winners.

It’s the weekend now, and we get a little break after Saturday morning classes, to recover and read up on next week’s cases.

One tired student,

Kate Simpson

President,
Academic Travel Abroad

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Today, we explored the case of Mid-Missouri Energy’s ethanol production and decisions they faced in late 2007. Frankly, the case was 17 dense pages of grueling facts and 16 pages of graphs and data charts. I know more than I ever thought I would on the issues confronting this energy form and the challenges inherent in its continued production. One classmate suggested algae were a more efficient source of energy and could one day be the country’s total energy solution!

And yes, we did a Finance class on a “Contract Research Organization” (CRO) about to do an IPO and buy two smaller companies. We’re fortunate that our professor loves to bounce (literally, with hands above his head at times) and run (really) around the classroom to ensure we stay engaged and enthused about Weighted Average Cost of Capital, multiples and market valuations. When the projector wouldn’t work, he tore out of the room yelling “Help! Help! Help!” No worries. A techie classmate solved the problem before help arrived.

Tomorrow we start to present our strategies within groups. It’s a competition that lasts several days, and we will vote for the winning strategies until there are only two winners out of 160. Should be lots of fun!

Signing off in my dorm room in Baker Hall,

Kate Simpson

President,
Academic Travel Abroad

In our Negotiation class, we studied the case of the National Hockey League and the National Hockey League Players’ Association confrontation of 2004-2005 which resulted in the NHL canceling the season. Here we see how strong egos, water under the bridge, and distrust can lead to stalemate and a lose-lose scenario. The NHL and NHLPA have paid a high price for the mistakes committed in this negotiation.

In our Marketing class, we examined a classic case–Benihana of Tokyo. We learned how, in 1972 in midtown Manhattan, Rocky Aoki established a unique formula for a restaurant chain (minimum kitchen area, maximized bar area, controlled staff costs, reduced food costs, all enhanced by at-table entertainment) and managed to sustain a legacy for decades. Now if you google Rocky Aoki, you will find an expose about his life in the New York Magazine–sad, but funny. Some cases have odd endings.

On to our Globalization class–the case: India on the Move (set in 2003). A fascinating study made all the richer by the many well-informed Indians in the class. Was Nehru wrong in 1948 to have followed the Soviet Union’s example of a centrally planned industrialization of an agrarian, fragmented land? Would Indians be as equipped and autonomous in their current economic growth had he allowed foreign direct investment and a free market economy? How accurate are the official growth rates? Some of our Indian classmates contend they do not take into account a large informal economy. Will political and religious strife allow the economy to continue on its upward trend?

Kate Simpson

President,
Academic Travel Abroad

There’s an amazing energy coursing through the campus of Harvard Business School these days. It’s a force to be reckoned with–it’s called OPM37 or HBS’ “Owners/Presidents Management 37th Class.” It only lasts three weeks a year for three years, and this is OPM37’s last year.

OPM is one of Harvard Business School’s most prized executive education programs, designed to elevate and expand the minds of leaders in business and industry around the world. From my first day three years ago to the present, I have been truly astounded by the diversity, intellect, talent and good humor of 160 classmates from the US, Canada, Central and Latin America, China, India, and all over the African Continent. We U.S. citizens make up less than 50% of the class. We women make up less than 8%. We American women make up half of that small minority.

We’re fortunate to have the creme de la creme of HBS faculty teaching us. As you can imagine, it’s a refreshing break for them to have classes full of experienced entrepreneurs well into their careers, rather than 22-year-old MBAs. This year, they’re taking us to practical levels of instruction, having us focus on our own corporate advantages and strategies on multiple levels. We’re looking at our leadership styles through different lenses and learning how differently others perceive us from how we perceive ourselves.

After three years, many have become tight friends, others have hired classmates and work together, others still have joined classmates’ companies’ boards, some have visited each others’ businesses, and many cavorted under the Cancun sun last fall where the Mexican contingent hosted a mini-reunion.

The combination of learning in class and learning from each other is a winner.  HBS has bottled the very finest essence of business education here.

Signing off from a little dorm room in Baker Hall,

Kate Simpson

President,
Academic Travel Abroad