Normally, I use this forum to provide you with uplifting news about our faculty, staff, students, and programs. However, today I cannot do so. Earlier this week, Professor Jeff Conant, a member of our faculty since 1985, died unexpectedly. Jeff was a tremendous educator, colleague, and friend, and his passing will be felt deeply by many.

I first met Jeff in 2001 when I assumed the role of dean at Mays Business School. Like all who knew him, I was impressed with Jeff’s dynamic personality, his genuine concern for others, and his passion for teaching and for students. While Jeff’s career and life highlights are many, I was pleased to see his outstanding work recognized by his being named a Texas A&M University Presidential Professor for Teaching Excellence and to watch his leadership within Mays grow as he became department head. He was well suited for the job, a natural leader. Under his guidance, the marketing department has flourished.

Jeff was loved by his students as well as his colleagues. He was an important part of our Mays family and he will be sorely missed by all of those fortunate enough to know and work with him. Please join with me in keeping his family in your thoughts and prayers.

More information: Longtime A&M marketing professor and department head dies suddenly

By senior year, Tom had racked up several thousand dollars in credit card debt as he charged school-related expenses and other incidentals. Tom wasn’t worried about his mounting bills, as he would soon be entering the workforce full-time.

According to an April 2009 report from SallieMae, 84 percent of college undergrads have at least one credit card. Half of the students polled had four or more cards.

Tom did eventually find a job after a few months of searching, during which he used credit to float by. He intended to pay down his debt, but by that time he’d become accustomed to living slightly beyond his means, filling the gap with credit and making the minimum payment each month. His debt escalated, especially as his credit card rates steadily and stealthily increased from 8 percent to 15 percent for no discernable reason.

When the economy worsened and Tom lost his job, he knew he was in trouble. The credit card company raised rates on his large existing balance to 24 percent after a missed payment. Now broke and unemployed, Tom wonders how he got to the point where bankruptcy is an attractive option.

Tom’s is a common tale in the credit-saturated U.S. society, where “enjoy it now, pay for it later,” is the favorite message of marketers. As more and more Americans slide toward financial ruin, consumer advocacy groups that for years have spoken out against abuses by the credit card companies have finally been heard. On May 22, President Obama signed the Credit Accountability, Responsibility, and Disclosure (CARD) Act of 2009 into law, which will limit or change the way credit card companies do business starting in February 2010.

Will the bill make a difference to consumers or the economy? Kelly Haws says the effect of the legislation will be significant. Haws, assistant professor of marketing at Texas A&M University’s Mays Business School, has conducted several studies on consumer use of credit. “Consumers might actually change their spending behaviors as a direct consequence of this legislation,” said Haws. “Even if it has only a minor effect, it could be huge when it comes to how people are managing their personal finances.”

More disclosure = more responsible spending?

As the U.S. economy continues to languish, people are spending less, and so like many other industries, credit card companies have been making less. This situation led some creditors to come up with creative ways to boost revenues, such as “any time, any reason” rate hikes or hidden fees (Americans pay about $15 billion each year in credit card penalty fees). The CARD Act bans certain rate increases and unfair fee traps, as well as mandating more transparency between lender and borrower. When the bill takes effect in a few months, credit card companies will be required to notify consumers of rate changes 45 days in advance of the change. Also, companies will be required to display the consequences of credit decisions to consumers in periodic statements, such as how long it will take to pay off an existing balance with interest if the consumer pays only the minimum balance.

Haws says that this kind of stipulation is potentially positive, but that many consumers don’t take the time to understand financial statements. Benefits of that component of the act may be limited if consumers disregard notices from their creditors that seem too complex.

According to a study Haws conducted, people will modify their spending behavior when given greater information about the real costs involved with using credit. However, her study involved subjects in a controlled setting, a very different environment from the one experienced by most credit card holders on a daily basis. “In the real world, there are a lot of distractions that can influence those actions,” said Haws.

Even without full comprehension of the statements they’ll receive, consumers will benefit from their new protection under the law, which will ban credit card companies from increasing rates retroactively without cause. Companies will also be severely restricted from retroactively increase rates due to late payment.

Slow down, Junior

One area of the new law both Haws and colleague Don Fraser agree will be impactful is the age restriction. “This is one of the most important dimensions of the legislation,” said Fraser, Hugh Roy Cullen Chair in Business and associate head of the department of finance at Mays.

The CARD Act will prevent credit card companies from targeting potential customers under 21. Those under 21 that want a credit card must have a co-signer on the account, or show proof of independent means.

Currently anyone over 18 can get a credit card—and many do. According to an April 2009 report from SallieMae called “How Undergraduate Students Use Credit Cards,” (download a copy here) 84 percent of college undergrads have at least one credit card. Half of the students polled had four or more cards. The study also noted that undergraduates are carrying record-high credit card balances, with the average (mean) balance of $3,173. More than 20 percent of undergrads reported credit card balances between $3,000 and $7,000.

In the past, credit card companies were allowed to market aggressively on college campuses, incentivizing their offers with promotional gifts from tee shirts to iPods. “Removing the ease of accessibility to that market could really be transformational,” says Haws. College years are formative, making it an opportune time for credit card companies to lock in a customer for life on the debt merry-go-round, as young people often lack the knowledge or analytical skills to use credit wisely. Haws notes that some college campuses already ban credit card sales reps on their premises as a protection to students. Getting parents on board as potential cosigners is beneficial, too, as past research suggests that this could help prevent debt from accumulating during college years. “Studies show that the more parents are involved, the more responsible the student’s use of the credit card is,” she said.

Drawing the legislative line

Though the CARD Act passed through the Senate with a vote of 90-5, showing overwhelming support for regulation of credit card practices, some economists wonder if it was the right thing to do. After all, if a product is bad, shouldn’t consumers stop buying it? According to a 2009 Nilson report, 78 percent of American households have at least one credit card. Clearly, consumers are still purchasing these services. The free market philosophy that the U.S. economy is built upon argues that the consumer demand will regulate the market eventually on its own, without interference from the government.

“My opinion is that the legislation was badly needed, as there were numerous examples of abuses by credit card lenders. It would have been better if these changes had been made some years earlier,” said Fraser, commenting that though some consumers (likely those with the best credit practices, who pay off their balance each month) will may see an increase in rates and fees, overall consumers will be better off as a result of the legislation.

Haws agrees that the credit card reform is positive, as the consumers that are often most affected by predatory practices by credit companies are the ones who can least afford to pay, such as those with excessive debt from medical or other unforeseen expenses. “This will provide protection for consumers that are already hurting,” said Haws.

Other detractors of the bill hypothesize that this increase in regulation will lead to a tightening of the credit market, which will hamper economic recovery. “From a macro economic perspective, I would expect that the legislations will reduce the amount of consumer spending and thus increase the amount of consumer saving,” said Fraser. “In the short run, this will tend to dampen any economic recovery, but probably not to a large degree. In the long run, however, it will encourage saving, something that will be a net benefit for the economy.”

Will the legislation force an overhaul of credit card practices as companies struggle to stay profitable? What will the future of the credit industry look like? “Obviously, to the extent that the new legislation is successful in limiting or reducing the abusive practices, the credit card issuers will have to seek alternative revenue sources from their credit card customers,” said Fraser. “This is especially relevant today as the bank issuers of these credit cards are often in serious financial difficulty and in some cases on the verge of failure. They cannot tolerate significant reductions in their revenue streams.” Fraser suggested that credit card lenders may increase their average interest rates, screen out certain less profitable borrowers who may not use their cards often or who pay in full at the end of the payment period, or deny cards to those with low FICO scores, in an attempt to stay profitable.

Will rewards programs and no annual fee cards disappear under the new model as some have predicted? “I’ll believe it when I see it,” says Haws. “It’s such a competitive market that it’s unlikely they will do away with all of these programs.”

Hardin (right) and two friends from Australia in front of the Lincoln Memorial directly after the MLK Day celebration.

There were a predicted four million people present, and billions around the world watching the National Mall in Washington, D.C., as Barack Obama, the 44th President of the United States, recited the oath of office. I was standing next to the Washington Monument, more closely resembling a popsicle than a human being, however, I was better off than some of the other people I had met who had been camping out since 3 a.m. Although I watched the proceedings on the giant screens set up all along the National Mall, I could partially see the Capitol Building from where I stood. Being present at such an event, sharing in the minor suffering of the elements with my fellow Americans, was an incredible moment that I will cherish for the rest of my life.

The day immediately before the inauguration was Martin Luther King Day, which was appropriately celebrated at the Lincoln Memorial. Celebrities from Denzel Washington to Steve Carrel were present, with performances by Shakira, Bruce ‘The Boss’ Springsteen and my most anticipated… Beyonce. Often finding myself surrounded by an international crowd, I made sure all of the Australians, Canadians, Israelis, Norwegians and Puerto Ricans knew that Beyonce and I shared the privilege of calling Houston home. We sang and performed the ‘circle chicken dance’ from the music video “Single Ladies” all day, eagerly awaiting her live performance. Using some flawed logic, she chose to sing the much less patriotic tune of “America the Beautiful.” We’ll forgive her, only because she is Beyonce.

Searching for a place to grab a bite to eat (which was quite a feat given the number of people present in the city) we ran in to some cadets from the Naval Academy who were in the Glee Club, and had gotten to sing onstage at the MLK Day performance. Their pictures of Barack and Michelle were literally taken from only a few yards away, and they captured pictures of Bono and friends from within inches. Although two very different perspectives of the same event, we were all able to enjoy and recall the moment together.

Don’t get between Americans and their coffee on chilly D.C. mornings! Every trashcan in the city was overflowing with used coffee cups.

With the exception of my immediate international circle, everywhere I went was amidst a sea of Americans, many of them black. Growing up in Houston, I went to a high school that was largely black and Hispanic, with a dwindling number of white kids. Looking around at the crowd, I noticed generations of black Americans that had traveled far and wide to witness and be a part of this piece of history. It brought a tear to my eye when I saw an elderly black woman, her eyes wet as she gazed across the Reflecting Pool to the Lincoln Memorial, as she listened to President-Elect Obama Obama speak. She was ethereal, somehow outside of her body and in the present. I never asked her, but I didn’t have to in order understand that she had been in that exact spot before, almost half a century younger, listening to Dr. Martin Luther King share with the world his dream, the dream of millions.  Standing there with her grandson, asleep in his stroller, it was as if you could take a bite out of her sense of pride, accomplishment, and assurance.

Washington, D.C., is notorious for being a dangerous city, however, my entire time there, I never once felt unsafe. Something in the air felt brisk and refreshing, like a sip of Diet Coke. The streets were packed, it was disturbingly glacial (I literally traversed block by block, stopping in a pub/restaurant on each corner, thawing my nose and re-circulating the blood in my toes) but none of these elements of discomfort or potential sources of frustration seemed to dampen the mood. The news networks all wonder when the honeymoon period will end, but based on my assessment on Connecticut and 18th, real change is in the air.

Paetzold is a professor of management and a research fellow at Mays Business School at Texas A&M University. Her article, “Statistics is a plural word,” appeared in the Law Review as a rebuttal to an argument made in a previous issue about the limitations of regression modeling for proving causation in civil rights cases like the one mentioned above.

Paetzold

“Some kinds of cases require statistical evidence as proof. Without it you could not establish discrimination,” said Paetzold. “Other kinds of cases will only use it for supporting evidence of discrimination—the primary evidence has to be more specific to the employee who is suing, such as comparing the employee’s treatment with how other employees were treated.”

The article focuses on how much and what kind of statistical evidence should be used by employees in proving employment discrimination against their employers—or conversely, by employers to defend themselves in employment discrimination suits.

“Employers need to understand the ways in which statistical evidence can be used in these lawsuits,” said Paetzold. “They also benefit from knowing some of the types of statistical methods that can be used to provide statistical evidence.”

Paetzold coauthored the article for Harvard Law Review with Steven L. Willborn, dean and professor of law at the University of Nebraska College of Law. She and Willborn also collaborated on the book The Statistics of Discrimination.

Paetzold specializes in human resource management, with research interests at the intersection of human resource management and employment law. Her work encompasses psycho-legal aspects of sexual harassment, disabilities and accommodations, and workplace violence. Her research has appeared in outlets such as the Academy of Management Review, American Business Law Journal, North Carolina Law Review, Employee Rights and Employment Policy Journal, and Journal of Applied Social Psychology.

She has served as senior articles editor for the American Business Law Journal and editor-in-chief of the Journal of Legal Studies Education. Her primary teaching responsibilities at Mays include courses in employment law, employment discrimination law, and research methods.

The purpose of the endowment is to promote awareness of, and enhance the quality of preparation for, public accounting as a profession. Specifically, earnings from the endowment will be used for scholarships, as well as supplementing opportunities for students in the Department of Accounting or the Professional Program in Accounting.

Part of the motivation for this gift is name recognition, says John Steffes ’87, partner in charge of recruiting at BKD’s Houston branch. “The market for recruiting these Professional Program students is very challenging,” he said. “The A&M program puts out high quality students. It’s a very competitive market place.” Steffes said BKD’s gifts are intended to display the firm’s commitment to the accounting department at Mays and to the talented students who are their potential future employees.

“The new endowment commitment is a continuation of the significant support from the partners of BKD over an extended period,” said Professor and Accounting Department Head James Benjamin. “This support has clearly helped accomplish their goal of enhancing accounting education at Texas A&M. I hope that BKD benefits as well as a result of their successful recruiting of our graduates.”

Steffes was unabashed in his praise of the A&M program, saying that the Aggies BKD hire are an important component of the business. “You really only have two assets, your people and your clients,” he said. “Good people bring in good clients.”

“The Professional Program was designed to have exactly what we’re looking for,” said Steffes, who typically recruits students during their junior year. At that time, students can enter an internship program prior to their senior year, then potentially begin working at the firm full-time after graduation. Steffes says that about one-third of his recruits are Aggies, so it makes sense for the firm to invest in the A&M program.

About BKD

BKD is the top-tier U.S. CPA and advisory firm that delivers its experience and service with a deep understanding of your business, your needs and what it takes to improve your business performance. BKD’s approximately 2,000 personnel, including approximately 250 partners, are based in 32 offices serving clients in 50 states. To learn more, visit www.bkd.com.

Conant had built a career at Mays over the past 23 years, joining the faculty just prior to graduating from a PhD program at Arizona State University in 1986. He achieved the rank of professor in 2000, and later took on the leadership of the Department of Marketing in 2006.

Conant

During his lengthy tenure at Mays, Conant accumulated numerous recognitions for the quality of his teaching. In 2004, he was honored by Texas A&M as a Presidential Professor for Teaching Excellence, and the following year he was given the title of Eppright University Professor in Undergraduate Teaching Excellence. In 2007, Conant won a national Distinguished Teaching award from the Society of Marketing Advances. “I’m motivated to create good leaders who are persuasive communicators and analytical thinkers and are ethically sensitive,” said Conant after winning the award. “The exciting moment for me in the classroom is when students exceed their own expectations and I get to be a part of it.”

Conant was also the recipient of two distinguished achievement awards in teaching from the Association of Former Students at Texas A&M, the Piper Professor Award (given annually to select educators in the state of Texas by the Minnie Stevens Piper Foundation of San Antonio), and the Great Teachers in Marketing Award from the Academy of Marketing Science.

Conant’s research has appeared in respected publications such as Strategic Management Journal, Journal of the Academy of Marketing Science, Journal of Marketing Education, Industrial Marketing Management, and Journal of Retailing. He was also the author of two book chapters and a number of conference papers. His research interests included marketing strategy and the scholarship of teaching and learning. He received Journal of Marketing Education’s Outstanding Article of the Year Award three times, as well as a Best Article Award from the Marketing Education Review.

His programmatic stream of research on the distinguishing characteristics of master teachers is widely acclaimed. Other scholarship of teaching and learning topics he examined included the introduction stage of the faculty career life cycle, case teaching, and techniques for enhancing large class instruction.

A memorial service is scheduled at noon on Friday, 3 July 2009, at First United Methodist Church in Bryan, Texas.

Remembering Dr. Conant

• Market Climber: Empowerment: Jeff Conant’s Leadership Legacy

Mays

“At a time when so many are affected by this challenging economy, we are fortunate to have generous benefactors in the Mays family,” said Jerry Strawser, dean of Mays Business School. “Their past support has enabled our school to achieve status as one of the top public business schools in the world, and this most recent gift will allow us to continue delivering outstanding programs to our students. We are proud to have one of the most influential businessmen in Texas history endorse our programs in such a meaningful way.”

This latest gift builds upon the Mays’ 1996 contribution of $15 million, which continues support of the business school’s initiatives. It was at that time the college of business at Texas A&M was formally named in the Mays’ honor.

The current gift will support one eminent scholar chair in the name of Peggy Pitman Mays and one regular chair honoring Benton Cocanougher, dean emeritus and professor emeritus of Mays Business School. Additionally, it will provide matching grants for two other eminent scholar chairs and five regular chairs.

The program also ranks 5th for program scope and 9th for depth of programs offered.

A&M is the only school in Texas to be named in these rankings.

“The results are very encouraging and indicate our program is on the right path,” said E. Powell Robinson, head of the Department of Information and Operations Management at Mays, which houses the supply chain program. Robinson noted the rapid progress the program has made in the past several years in regards to curriculum design and impressive faculty hires. “The rankings also indicate that we are positioned to move up quickly should we maintain the course,” he said.

To arrive at these rankings, AMR surveyed 126 companies about what skills a supply chain graduate must have to be successful in the field. Their responses led to an in-depth analysis of supply chain programs at 19 top U.S. universities to distinguish which programs are producing the best prepared graduates by industry standards.

The research found that the best programs provide students with a broad understanding of supply chain concepts, rather than specializations within the field. Also, those with an emphasis on internships, applied knowledge, and teamwork ranked highly.

About the INFO department at Mays

The Department of Information and Operations Management at Mays Business School offers undergraduate and graduate degrees in supply chain management and management information systems. The goal of the department is to create professionals who understand the underlying theory of decision-making systems and possess the problem solving skills necessary to succeed in a highly competitive business environment.

It’s a good thing, too, since his more than two decades of service left him medically disabled to the point where traditional employment would be more than challenging.

He’s still a young man, in his early 40s, but there are days when he doesn’t feel like it, days when it’s hard to even walk. “Sometimes I’m okay. But sometimes it hinders me. My whole body hurts,” said Lopez, who suffers from arthritis and bone problems developed over his years of service.

Since his retirement from the military in 2006, Lopez wanted to launch his own business in real estate investment. He knew he had the valuation skills necessary to make the business work, but he lacked the confidence to strike out on his own and take the risks necessary.

That changed last summer when he attended the Entrepreneurship Bootcamp for Veterans with Disabilities (EBV), a program offered at Texas A&M University’s Mays Business School.

“It energized me,” said Lopez. “The only thing I was lacking was action. Fear of losing and fear that I didn’t know what I was doing held me back…now, instead of just talking about it, action! I’m taking a chance. A calculated risk.” The risk is paying off, as Lopez has now purchased several properties and sold them for a profit. He is planning more purchases of fixer-uppers and foreclosures that he can flip, with the long-term goal of one day buying a small apartment complex and operating his own property management company.

Lopez is one of the many success stories to come out of the EBV program, which was offered at Mays for the first time in the summer of 2008. Planning and fundraising are underway for the 2009 bootcamp, to be offered August 15-23.

The program

Last year, 16 servicemen and -women injured as a result of military service since September 11, 2001, participated in the EBV program at Mays. The program is designed to assist veterans with disabilities in becoming small business owners. It’s provided to participants for free, travel and accommodations included, thanks to the generosity of supporters. The wounded warriors selected for the program complete a three-week online business course prior to an intense eight-day residency period on the A&M campus. A year of long-distance mentoring with a Mays faculty member completes the course.

Ricardo Lopez, seen here giving his final presentation during the 2008 EBV, credits the program with giving him the confidence to launch his own business.

From budgeting to IP protection, the EBV program focuses on the elements that are important to the would-be entrepreneurs, many of whom come to the course with big ideas and a storehouse of passion, but little business experience. The course presents lessons on creating a workable business plan, securing financing, marketing, and other important areas such as taxes and legal issues.

“The other thing that we bring to this project is an everyday focus on working and living with disabilities,” says Lester. Disability experts, and veteran’s administration affairs and workforce commission representatives present to the group daily, as well as Mays faculty members and successful entrepreneurs.

Lester says there’s a great need for this kind of service. “The number of veterans with issues after they are discharged from the service is phenomenal. One-third of all the homeless folks in the United States are veterans. So, we have a really at-risk population,” he said.

As the wars in Iraq and Afghanistan continue, the number of U.S. veterans—many of them with physical or emotional trauma—grows exponentially each year. “There is an impending crisis looming for disabled veterans…as regards long-term employment opportunities,” said Lester, who hopes that Mays involvement in this program will help the student-veterans to take charge of their futures through owning businesses.

This year, Lester expects to have 20 participants in the innovative program.

Special people

Toni Williams has a heart for children, especially those who face added challenges due to disabilities. When Williams was honorably discharged from the Marine Corps in 2002 due to an injury that left her with a hearing loss and inner ear problems, she decided to serve her country in a new way. She joined Teach for Texas and earned a teaching certification with an endorsement in special education.

“The program brought me from just having an idea to where I am now,” said Toni Williams. The 2008 EBV participant aims to open a school for children with special needs next fall.

Through her experiences in the classroom working with special needs 6-8th graders in Dallas, an idea started to form in Williams’ mind: a school for just these types of kids; an environment where they could be nurtured and encouraged, and taught how to be a successful part of society; a place for kids from low-income families to get the care they need.

Her dream school might have remained nothing more than wishful thinking had it not been for the 2008 EBV program at Mays. Today, Williams is applying for her non-profit status, creating the school’s curriculum, and looking for a space to rent, with a plan to enroll her first class in fall 2010.

“The program brought me from just having an idea to where I am now,” she said. “It’s been a tremendous support system for me as I’m trying to become an entrepreneur.”

Williams is dreaming big: she’d like to open branches of the school in other parts of Dallas and other cities. “This isn’t going to go away, my idea. It’s going to be solidified, and it’s going to be successful.” Williams credits the EBV program with her progress. “I tell all of my friends from the service that if they have any spark of wanting to become an entrepreneur, it’s a wonderful program.”

EBV is offered in consortium with the business schools of Syracuse University, UCLA, Purdue University, and Florida State University. Applications are accepted on a rolling admissions basis, so there is no set deadline for applying to the program. More details are available at http://mays.tamu.edu/ebv/.

Experiences like Lopez’s and Williams are made possible through the generosity of individuals and corporate donors. If you would like to support a veteran in this program, you can give at https://maysapps.tamu.edu/maysdonate (select “Disabled Vet Bootcamp” from the drop down menu) or contact program director Richard Lester directly at (979) 862-7091 or rlester@mays.tamu.edu.