Webster University/Shanghai University

of Finance and Economics Joint MBA

Teams Promote

Mutual Funds for Energy Independence

End Spring 1 Semester

June 3, 2008

In Shanghai, China, 28 MBA candidates at Webster University just presented mutual fund portfolios based on alternative energy companies.  The presentations were the final product of a nine-week, elective course which used promotions management as the framework of the total course.   Normally, the course focuses on promotional issues in marketing.   Because energy has been an overriding factor in global economics, the instructor used text-book concept to outline the mutual fund project.  These ideas included various target groups, groups needs, behaviors and  aspirations, benefits, positioning, messaging, and a variety of communications tools. 

 

Sunflower Fund MBA Team Member (Left to Right Fan Lin,Lu Wenhui, Richard, Shi Minggang, Zhou Yu, Wu Xunlei, Lee Pinglin)

Teams could have selected “anything energy”, but oil.  Building a mutual fund with existing companies is a hands-on method of creating a usable product or service.  With more Chinese companies turning to equity funding, it made a great deal of sense to link financial markets with the promotions area, especially in investor relations.  Even during the week of the presentations, the Beijing government was announcing plans to hire a number of domestic investment firms to provide management of various parts of the country’s pension funds.  In early April, the government was announcing plans to pursue and encourage a wide variety of national alternative energy efforts.  The need for alternative energy in China is both critical and being actively pursued.

China already is home of a significant number of companies manufacturing all or portions of solar photo voltaic (PV) cells, thin films, wind generation, and finished solar collection panels. 

 Interestingly, all of the MBA teams decided to select operating companies that currently providing product or service in the area of clean energy.  From the Webster-side, we did not suggest pursuing energy that is environmentally friendly, or might reduce global warming; however, all of the teams created portfolios that were free of energies that might come from coal, or nuclear sources.  Wind and solar technologies were by far the most numerous, although there were a number of company picks that were on the side of biomass, or hydroelectric. 

All of the teams instructed to select publicly traded companies.  Equities had to be traded someplace, and teams generally looked to exchanges in Shanghai-Shen Zhen, New York,  London, and  Hong Kong.   All of the teams focused selling their mutual or ETF products to customers in China.  Customer s must show some propensity for alternative energy. Buyer motivation cut across a range from profit to “environmental zealots”.  Teams used various fund names including -- The Giant Energy Fund, Karry Fund (first name of the team leader), Earth Day Exchange Traded Fund, IDEA Green Energy FUND, and the Sunflower Fund. 

During the nine week course, the MBA candidates used traditional marketing  and promotional text materials, but  they also borrowed  from other courses they had already taken in the twenty-month MBA program, including, finance, and the basic marketing course.  Building the fund required research, including product or services, market position, and general health of the company.  Teams had reviewed existing competitor funds as examples.   They, they had develop and show their positioning within other funds and ETF’s, and create a message to their target audiences which would appeal to buyer needs and desires.

For more than ten years, Webster University has been a partner in China, helping to move a former fully, directed state run economy to a market economy, and then a domestic economy plugged into the global economy.  In this course, the MBA candidates easily took on the work of raising capital, searching for and selecting relative companies, allocating their investments to each, and then communicating to appropriate target audience about their various offerings in the market.   Most of the team members of the five “alternative energy fund” groups, work weekdays, but attend classes on one full-day a week, either Saturday or Sunday. 

Webster University in Shanghai is a Joint Partner for the MBA Program with Shanghai University of Finance and Economics.  

Instructor:  Richard Foristel, Director, Webster University, China