Duke - The Fuqua School of Business

News Release

Fuqua Reflections and Predictions

Fuqua faculty and staff reflect on 2012 and give insight into the year ahead

December 21, 2012

As we welcome in the New Year, we wanted to take a moment to reflect on 2012. We also asked some of our faculty and staff about what they see as upcoming trends in 2013.

What economic trends should we be on the lookout for in 2013?

John Buley - Consulting Professor of Finance and Executive Director of the Center for Financial Excellence

"By June of 2013, it will have been seven years since U.S. housing prices peaked.  Most thought a re-adjustment would last no more than two years. Instead, it has wreaked havoc on balance sheets for three and half times that length. The first national decline in home prices since the Great Depression is slowly coming to an end. Interest rates can no longer be viewed as a gauge of effective supply and demand for credit given QE3 and other Fed policy. Therefore the best indicators for 2013 will be a combination of housing starts, labor costs of building those properties, and the rising cost of raw materials to build."

"Hurricane Sandy rebuilding will also have an effect on lumber and other related housing costs, which can't be discounted.  The good news is that we will no longer be looking at foreclosures and loan modifications as the gauge of poor conditions. Banks and mortgage servicers finally realized that taking on massive foreclosed inventory was not in their interests. They will finally be looking at housing starts as an indicator of how quickly the U.S. lowers unemployment and therefore stimulates demand."

John Graham - D. Richard Mead, Jr. Family Professor, Finance

"As 2012 ends, much of Washington and Wall Street are preoccupied with whether the U.S. goes over the fiscal cliff. While I certainly hope we are able as a nation to address the budget and tax issues our politicians are wrestling with (because going over the cliff would likely push the US into recession), one thing to keep in mind is that even if a remedy is found, it likely will involve spending cuts and tax rate increases. Both of these in turn will likely lead to rather slow economic growth in 2013 - and, that is the good news scenario."

What should be the top priority for marketers in 2013?

Gavan Fitzsimons   - R. David Thomas Professor, Marketing

"Marketers increasingly accept that much of consumers' decision-making occurs outside their conscious awareness. In 2013, we have to push ourselves to adjust our marketing mix accordingly, as well as embrace new measures that help us better understand the psychology of the unconscious consumer."

Christine Moorman - T. Austin Finch, Sr. Professor, Marketing

"Marketing leaders should seize the opportunity that has been created by the confluence of challenging economic conditions and major technological innovations that are changing the way that marketing is conducted. Emerging social media tools and the opportunity to use powerful marketing analytics to drive growth is unprecedented.  Marketing leaders should harness these new tools in order to gain traction in new markets.  The tools will also help develop new business models and new sources of value that will give their companies a sustainable competitive advantage for years to come."

Who were the most inspirational leaders of 2012?

Sim Sitkin - Professor of Management - Faculty Director, Center on Leadership and Ethics (COLE)

"I would single out New York City Mayor Michael Bloomberg and Newark Mayor Corey Booker.   Whether or not you agree with their politics or their particular positions, they both took courageous action on behalf of their constituents and were willing to try to influence the agenda on important, complex problems facing our society. Booker took on education, crime, and urban development - and while saving someone from a burning building was certainly not part of his job description it still demonstrated the courage needed to lead."

 "Bloomberg took what he knew would be an unpopular action to encourage dialogue and responsibility concerning obesity with his soda size restrictions. He also showed vision in starting a new Silicon Valley in New York with the construction of a technology-focused university on Roosevelt Island to anticipate New York's economic development decades into the future (long past his political career).   Both represent modern profiles in courage - not blinded by ideology, but courageous in their convictions - that we could use much more of in both the public and private sector leadership today."

Sanyin Siang, Executive Director, Center for Leadership and Ethics (COLE)

"As a business leader, LinkedIn CEO Jeff Weiner merits recognition for leading one of the most successful IPOs in recent years through building a strong organizational culture, focusing on people and keeping success in perspective."