MIT Reports to the President 1994-95

RESEARCH CENTERS

Center for Energy and Environmental Policy Research (CEEPR)

The Center for Energy and Environmental Policy Research (CEEPR) is an activity, jointly sponsored by the Sloan School , the Energy Laboratory, and the Department of Economics, that funds policy-related research in energy and environmental economics. The Center receives financial support from 23 corporate sponsors and 3 government agencies who contribute a minimum of $35,000 annually to the Center's research program.

For the past several years, CEEPR's principal research focus has been the Joint Program on the Science and Policy of Global Change, conducted in collaboration with MIT's Center for Global Change Science. This program, led by Professors Henry Jacoby and Ronald Prinn, draws on MIT's traditional strengths in science and economics to conduct interdisciplinary research to support global climate policy. In the past year, the economic and climate components of an interactive integrated global model have been created and the integration of these components is underway. Also, a strong collaborative research effort has been established with the Woods Hole Marine Biology Laboratory to provide the eco-system models required to link global climate to local and regional effects.

At CEEPR, the most notable new activity is the start of work under a two year grant from the U.S. Government to evaluate the costs of compliance with the acid rain provisions of the Clean Air Act Amendments of 1990. This evaluation provides the first "ex post" assessment of the emissions trading provisions which established the largest public policy experiment to date on alternatives to command and control for achieving compliance with environmental objectives.

The Center for Information Systems Research (CISR)

The Center for Information Systems Research (CISR) continues to conduct research on the management of information technology (IT) in today's global and dynamic business environment. Highlights from 1994-95 include:

International Center for Research on the Management of Technology (ICRMOT)

The 1994-95 academic year marked the fourth full year of operation of the Sloan School's International Center for Research on the Management of Technology (ICRMOT). Most of the center's research projects have entered the stage in which concrete results are becoming apparent.

International Financial Services Research Center (IFSRC)

The International Financial Services Research Center (IFSRC) is a partnership of industry and MIT designed to advance the knowledge and improve the practice of management in the global financial services industry. More than 30 Sloan faculty and relevant research staff are participating in research projects to the international financial services industry. The Center presently has nine sponsors and two associate sponsors located in New York, England and Japan. It has developed research programs in several areas, including major initiatives in risk management and corporate finance. The center has provided seminars and roundtable discussions on such topics as "Global Risk Management for Investment Institutions and Multinational Corporations", "Public Risk Management Standards", and "Inefficient Markets & Corporate Finance". Research sponsored by the center has resulted in hundreds of publications in areas such as "The Paradox of Liquidity", "Risk Measurement in Global Financial Markets With Asynchronous, Partially Missing Price Data" and "Distributed Knowledge and Strategic Responsiveness -- A Study of Corporate Responses to Volatile Exchange Rates". The center continues to have active projects with both individual and groups of sponsors. Professor Steward C. Myers has been the Director of the IFSRC for nearly seven years. Recently, he has been succeeded by Professor Paul M. Healy. The associate Director is Dr. Michael D. Siegel.

Center for Organizational Learning (OLC)

Fiscal Year 95 witnessed continued growth of the Center for Organizational Learnig, founded in 1991, as two new sponsors - Texas Instruments and Chrysler Corporation -- have joined the 17 other Fortune 500 companies and Health Care Consortium which sponsor the Center. The number of sponsors has been capped at twenty and there now is a waiting lest of organizations interested in joining. In-depth field research projects continue in a number of companies, including Ford Motor Company, Harley Davidson, National Semiconductor and Philips Display. The first field project initiated at the Center came to completion with the launch of the new 1995 Lincoln-Continental in '94, now among the highest rated quality cars in the Ford fleet. The Center is also developing new partnerships with other Sloan faculty, including working with the Center for Coordination Science and the Center for Information Systems Research on Sloan's new research initiative - Inventing the Organizations of the 21st Century. Lastly, there is growing world-wide recognition of the Center, as evidenced by feature articles in major business periodicals and the initiation of Organization Learning collaboratives patterned after the MIT model in Europe, Taiwan, Singapore, South Africa, Peru, Argentina, Australia and New Zealand.

Program on the Pharmaceutical Industry (POPI)

The MIT Program on the Pharmaceutical Industry continued to engage faculty and students in its portfolio of research and educational activities. Articles or working papers were released from POPI's major studies in the areas of drug development, manufacturing, the marketplace and the evolving public policy environment. POPI's research is conducted with ongoing input from colleagues in industry and government. POPI continued to offer several academic subjects for members of the MIT community, on-campus and off-campus executive courses for industry staff and research briefings to colleagues in academia, government and industry. Major new directions for the coming year will include an expanded focus on characteristics of drug development, manufacturing and the marketplace on the part of firms operating outside the U.S. Funding support for POPI is from the Sloan Foundation and six pharmaceutical and biotechnology firms.

Productivity From Information Technology (Profit)

PROFIT was established two years ago at MIT's Sloan School of Management to define new processes and technologies required to increase productivity from IT in both the private and public sectors. Four themes drive profit to maximize the value of data and make it a truly valuable corporate resource. These include: (1) automated data gathering; (2) efficient data integration and dissemination; (3) re-engineering of processes; and (4) better appreciation of the relationship between investments and information technology and overall productivity. In its first two years, PROFIT has created transferable technology in two areas. The first is for lifting information automatically from paper. The research team has developed a prototype system that can read bank checks and other documents with very high speed and accuracy. A promising aspect of this technology lies in its potential to eliminate cumbersome processes (and reduce consumer costs) in many different industries, from insurance to manufacturing to health care. The second area of progress focuses on the integration of disparate data sources. One theme of this effort is to develop systematic techniques for integrating islands of disparate information systems that characterize virtually all large organizations. Two prototypes have been developed in this area. One operates in a three-tiered client server environment as an extension to existing commercial software. The other operates on the World Wide Web to integrate numerous data sources (e.g. text, databases) from a wide range of data publishers. PROFIT is co-directed by Professor Stuart Madnick, Dr. Amar Gupta and Dr. Michael Siegel.

System Design and Management Program (SDM)

The System Design and Management Program, offered jointly by Sloan and the MIT School of Engineering, aims to provide engineers in industry and government with advanced technical and management education required to conceive, development, or procure and integrate, sophisticated products and complex systems. This past year, in collaboration with a small set of companies drawn from the aerospace, automotive, computer, and telecommunications sectors as well as the federal government, a core set of faculty have been creating a one year (September 1995 to August 1996) pilot version of the program and designing the full program. The pilot program, which will lead to a Master's degree, will include one semester on-campus and four courses given by distance learning technology. The full program, targeted for launch in the summer of 1996, will be conducted as a one and one-half to two-year graduate degree program featuring an option for both on-campus instruction and courses delivered to company sites via distance learning. Degree candidates must also complete a major applied project intended to integrate and exercise curricular learnings. The full program will also offer opportunities for company and government employees to enroll in a subset of the program for certificate credit, as well as internships for undergraduates. During the next academic year, the core faculty will be revising the program design and seeking MIT approval for the full program.

ADMINISTRATION

MIT Reports to the President 1994-95