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General Course Information |
B55.2310.30 Managing Financial Businesses Responding to
Change in a Competitive World Fall 2007 DRAFT Room MEC 2-60 Wednesday |
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Instructor Information |
Professors White, Zeikel and Zicklin (nwhite@stern.nyu.edu,
azeikel@worldnet.att.net,
lzicklin@nb.com) |
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Course Description and Objectives |
Overview
This course will
investigate the management of financial service organizations during a period
of rapid regulatory, cultural and technical change and culminating in today’s
lower growth and more heavily regulated environment. The view of the course
is from the “executive suite”. What are the issues that concern top
executives of financial service firms? The course will start with an
examination of the major trends impacting financial institutions and then
look at particular industries and institutions for valuable lessons. The
course focuses on three main themes; strategy and its execution, managing
culture, and managing technology. Course requirements will be a written case
and a final exam as well as class participation. Classes will be a
combination of lectures and outside speakers, many of whom are respected
leaders in their field. Course Requirements: Students are expected to
read the Wall St. Journal. There will
be many instances where the syllabus and the news will intersect and your
instructors will take advantage of those unfolding events to illustrate the
objectives of the course. Most classes
will have background readings online and you should be checking the Blackboard course management system at http://sternclasses.nyu.edu Attendance will be
taken and will be a factor in the grading process. Finally, students will be expected to have
read the material and be prepared to discuss it if called upon. In a class of this size, it is imperative
that nametags remain in front of you in order to help the instructors
identify who is speaking. |
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Teaching Method |
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Class Preparation |
Required
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Grading |
Mid Term Case 30% Final Exam 50% Class
Participation 20% |
The Faculty
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Norman White is a
Clinical Associate Professor in the Information, Operations and Management
Science department’ He is currently
Acting Director of the Center for Digital Economy Research at the Stern
School Arthur Zeikel is an
Adjunct Professor in the Finance Department and retired Chairman, President
and CFO of Merrill Lynch Asset Management. Larry Zicklin is a
Clinical Professor of Finance and former CEO and Chairman of Neuberger
Berman. |
Lectures
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(Subject to change, based on speaker
availability, check Blackboard for updates) |
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Session #1 |
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Topics |
Course
Overview, Financial Service Components Part
I - Course Overview: Forces of Change
Appetite for
capital, the growth in demand for investment funds Globalization of
Financial Services Conflicts in Financial
Services The Essence of
Strategy, Managing Change Part
II - Full Service Brokers and What Will Become of Them?
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Guest |
Part
II--Brad Hintz; Equity Analyst SC Bernstein and Former Managing Director
Lehman Corp. and Morgan Stanley--confrimed |
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·
On the
Threat of Change, Zeikel ·
Points
of Inflection: Investment Management Tomorrow, By Peter L. Bernstein,
Financial Analysts Journal, July/August 2003, pp 18-23 ·
·
The
Merrill Lynch-BlackRock Deal Signals Major Shift in Financial Services by
Wharton Finance and Investment |
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Session #2 |
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Topics |
Part
I -The Critical Nature of Technology in the Financial World—especially in
M&A
Part
II - The Universal Bank – History and Application Today
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Guests |
Part
I-Mel Taub - Former Chief
Technology Officer, Citigroup, Global
Technology Management
Part II - Prof. Roy Smith--confirmed |
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Radings |
·
Thinking
Big—Economist Report, ·
The
Future of Financial Services—Revisited by Federal Reserve Vice-Chairman Roger
W. Ferguson, Jr. ·
Inside
Wall Street’s Culture of Risk by Emily Thornton ·
Chief
Calls Deal a Dream for Wachovia—Julia Creswell ·
The
New Number One, Bank of |
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Session #3 |
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Topics |
Part
I – The changing nature of markets-Is it good for investors?
Part II –Culture--Compensation issues,
equity, free agency; loyalty and
behavior -- |
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Guests |
Part I --Robert Schwartz
–Marvin M. Speiser Professor of Part II--Roy Zuckerberg
--Retired Partner Goldman Sachs Former Head of Equity Division and member of
the Executive Committee |
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·
Mergers
are no cure-all for exchanges by David Lascelles ·
Stock
Exchanges Grudge Match by Aaron Luchetti and Jennifer MacDonald ·
A
Clash of the Exchange Titans by Jenny Anderson ·
Zookeeping, R. Smith (Blackboard) ·
Why Dream Teams Fail by Geoffrey Colvin ·
One
for All” or “One for One?” The Trade-off between Talent and Disruptive
Behavior--Human Resources at Wharton ·
On
Top of the World—Economist ·
The
Leadership Factory, Business Week |
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Session #4 |
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Topics |
Part
I – Changing Market Structure-The Outsiders
Part II—State Street Corp.—An
Alternative Model-Larry Zicklin |
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Guest |
Part
I -- Guest Speaker - Seth Merrin, CEO, Liquidnet
Part II—Larry Zicklin |
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Additional reading(s) |
·
Merrill Report
on US Market Structure ·
Global
Custody Pg.1, Outsourcing increasingly the model of choice by Pauline Skypala ·
Global
Custody: Pg. 3, Cultural fit is all-important…by Brian Bollen ·
Global
Custody: Pg. 4, The birthplace of the industry….by Jennifer Hughes ·
Global
Custody Pg. 4, Fees fall as the battle intensifies by Jennifer Hughes |
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Session #5 |
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Topics |
Private
Limited Partnerships (Private Equity, Hedge Funds etc.) Part I –
Private Equity, What is it and Where is it going? Part
II – Hedge Funds, the next bubble?
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Guests |
Part
I - Jim Brown, Partner, T.H. Lee Part II - |
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Additional reading(s) |
·
Early
Matters: Creating Value Through Operations at Portfolio Companies-- Knowledge
at Wharton ·
An
Impressive Miracle of Capitalism- Briefing Notes: Private Equity: Peter Smith ·
Buy
It, Strip It, Then Flip it—Business Week, ·
Barbarians
at the Top—Fortune, ·
No
Victors, Few Spoils in This Fight by Joe Nocera ·
Buy-out
funds take on more risk—Francesco Guerrera and James Politij ·
Private
Money: The New Financial Order—Greg Ip and Henry Sender |
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Session #6 |
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Topics |
Part I Class actions and risk
in the financial markets Part II- Manufacturing,
Distribution and Marketing on Wall Street –Where is the competitive
advantage?—Arthur Zeikel |
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Guests |
Max Berger and
Sean Coffey, Partners at Bernstein, Litowitz, Berger & Grossman LLP. |
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Additional reading(s) |
·
WorldCom:
How a Ground-Breaking Litigation Altered the Legal Landscape For Large
Securities Class Actions and Forced Wall Street To Forever Change Its
Ways—Institutional Investor Advocate ·
Breaking
The Banks: The inside story of the $6.1 billion WorldCom
settlement—Litigation 2005 ·
Back
In Action, Business Week, ·
Coming
Together, Institutional Investor, 7/06???? ·
Quarterly
Mutual Funds Review-A Whole New Look At Mutual Funds by Tom Lauricella |
Session #7 |
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Topics |
M&A on Wall
Street, Leadership Part I –
M&A on Wall Street - Putting it
together – taking it apart – Three Recent Transactions (Citigroup/Legg Mason:
J.P. Morgan/Bank of New York: and Merrill Lynch/Blackstone:) Why these unique
transaction structures? Part II – Wall Street and the Research
Analyst- Dan Reingold |
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Guests |
Part
I- Catherine Murray –Neuberger Berman Banking Analyst Part
II Dan Reingold former Telecom analyst at Morgan Stanley, Merrill Lynch and
CSFB and author of “Confessions of a Wall
Street Analyst” |
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Additional reading(s) |
·
Banking
On Brashness by Bernard Condon ·
From
pit to pinnacle: Why traders are calling the shots on Wall street Banking:
--Peter Thal Larsen ·
IPO
Auctions; What a Capital Idea—Joe Nocera |
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Session #8 |
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Topics |
Part
I – Entrepreneurs in the Financial Markets
Part II – Leadership--Arthur Zeikel
MID-TERM CASE DUE |
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Guest |
David A. Jones—Independent
Advisor and Trustee for Wealthy Families |
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·
The
Contender. In This Corner Jamie Dimon the New CEO of J.P. Morgan Chase by
Shawn Tully ·
Why
Principled Leadership Brings Profit and Pride to BB&T-Business Ethics
Emory ·
The
Leadership Factory by Joseph Weber |
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Session #9 |
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Topics |
Part
I--Index Funds: Does Low Cost Equal High Value? Part
II - Selling Out and Being Sold Out Before Building Up |
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Guests |
Part
I - Jack Bogle – Founder Vanguard, Index funds
Part II - Alexandra Lebenthal, Former
President and CEO Lebenthal &Co.
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·
Today’s
Research Question: Why Do Investors Choose High-fee Mutual Funds Despite
Lower Returns? By Wharton Finance and Investment ·
First
Of All, I’m An Honest Guy-by Holman W. Jenkins Jr. ·
Turn
On a Paradigm—by John C. Bogle and |
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Session 10 |
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Topics |
Part I-Wall street Scandals –Salomon
Brothers Part II-Managing Under a Microscope: The Manager and the Media |
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Guests |
Part I Tom
Strauss Former President of Salomon Brothers Part II Charlie Gasparino, investigative reporter, TV Commentator and
Author of “Blood on the Street” |
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·
Warren
Buffett’s Wild Ride At Salomon by Carol J. Loomis |
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Session 11 |
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Topics |
Influencing Change: Both From Within and
From Without |
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Guest |
Part
I – Charles Ellis, Author of “Capital”
Part
II- Part II - Risk and Reputation
– Larry Zicklin |
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Textbook reading(s) |
·
Capital |
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·
SEC
Charges Millenium Partners, L.P., ·
Mastering
Uncertainty by Rob Goffee and Gareth Jones ·
Deals
and Consequences—Landon Thomas Jr. ·
Goldman
CEO Tackles Critics, Touchy Issues—Susanne Craig ·
Too
Big For Its Own Good by David Stires |
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Session 12 |
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Topics |
Part I – Michael Price, former CEO Mutual
Shares and legendary investor (Mr. Price
led the insurgency that forced Chase Bank to merge with Chemical Bank) Part II-Course Wrap-up, Final Exam Review |
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Guest |
Michael Price |