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Economic Research on the World Stage

Marshall MBAs conduct intensive research on digital trade for 21 Pacific Rim economies

March 02, 2020
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As if Marshall’s MBA program wasn’t rigorous enough, 12 students volunteered for a year-long project that required thousands of hours of research, planning and analysis to create a report that will ultimately inform business and regulatory practices in 21 economies around the globe.

In February, the MBA team reported its findings to senior global business leaders on the Asia-Pacific Economic Cooperation’s (APEC) Business Advisory Council (ABAC) at an annual conference in Sydney, Australia.

APEC is a confederation of 21 Pacific Rim economies that encourages economic cooperation and promotes free trade among its members, which include China, Japan, Mexico, Russia and the United States. Since 2003, Marshall has been the only business school whose students conduct research for the business arm of this group—ABAC. USC research teams have tackled various aspects of international trade and commerce, including foreign direct investment, the investment landscape of sustainable energy, and trade in services across APEC.

“USC Marshall's ABAC project was a chance to engage in a perhaps once-in-a-lifetime opportunity to attend and present valuable economic research on the world stage."—Timur Tufail MBA '20

Digital trade was the hot topic this year. The MBA team was tasked with identifying the most significant non-tariff barriers to cross-border data flows in the APEC region, and providing actionable recommendations to enhance digital trade.

“The entire project spanned a year of work, and was an incredibly challenging yet rewarding experience, encompassing detailed project planning and rigorous execution of our tasks,” said Co-lead Timur Tufail MBA ’20.

In addition to Tufail, the team included: Armughan Syed (co-lead), Sam Bergman, Jie Chen, Christopher Hamermesh, Pablo Kao, Christy (Jing) Liu, Michael Nieman, Saori Nakayoshi, Amber (Thuy) Nguyen, Yuki Sakurai, Tongyu (Sherry) Zhao.

Working under the guidance of ABAC leaders and faculty advisors — including Associate Professor of Data Sciences and Operations Sriram Dasu, Associate Professor of Clinical Marketing Dennis Schorr and Professor of Clinical Business Communication Jolanta Aritz 

— the team had to quickly get up to speed on existing digital trade-related research, as well as related challenges, trends and opportunities in the region. They interviewed hundreds of business leaders, regulators and policy makers in 21 APEC economies, and then analyzed that information, consolidating it into an easy-to-digest report.

“We did all of this while balancing other academic coursework, jobs, recruiting and personal lives,” said Tufail, whose research focus was Japan and Russia. “At times, our project was at the mercy of uncontrollable events like political unrest in Chile or the Coronavirus outbreak. Yet I speak for everyone on the team when I say ABAC was the highlight of our MBA experience, and something we will always remember fondly.”

Tufail, a clean energy leader and former Deloitte management consultant who previously held data analytics and business development roles at a Silicon Valley-based start-up, said he signed on for this challenge for a number of reasons, including the opportunity to immerse himself in global trade, present at an annual ABAC summit, network with global business leaders and policymakers, and lead a large research team.

“USC Marshall's ABAC project was a chance to engage in a perhaps once-in-a-lifetime opportunity to attend and present valuable economic research on the world stage,” he said.

Other team members had similar motivations. “I was working as a policy maker in Japan before starting Marshall’s MBA program, and I wanted to learn more about how businesses in various countries see digital policies,” said Saori Nakayoshi MBA ’20. “The ABAC project gave me a great opportunity to interview 20-plus business leaders each in Singapore and Peru and learn about their strong need for internationally harmonized data regulation. I realized the strength of the Trojan family network spread across the world. Many Trojans in every economy were willing to be interviewed and connected us to industry experts.”

The Report

The team’s report, titled “Bridging the Digital Trade Divide: Navigating Cross-Border Non-Tariff Barriers,” will be included in the annual prioritized advice report that ABAC provides to the 21 APEC economies.

Here are some of the key research findings and recommendations:

  • The key challenge businesses face with respect to digital trade is trying to adapt their business models to the different regulatory frameworks used in various economies. In fact, an overwhelming 76 percent of interviewees cited inconsistent data regulations/standards as their No. 1 pain point. Other digital barriers included onerous data privacy and security requirements, ambiguity of regulations, and data localization laws. These barriers tend to impact MSMEs (micro, small and medium enterprises) the most, and typically result in increased compliance costs and technical complexities.
  • There is no comprehensive multilaterally adopted set of rules to govern cross-border data flows. The team suggested finding interoperability between the top two existing privacy-focused regulatory frameworks for data flow and detailed the pros and cons of these two approaches:
    • Enhance APEC’s “Most Interoperable” Middle-Ground Regulatory Framework (CBPR)
    • Move to “Most Restrictive” Regulated Approach (GDPR) 
  • In creating a high-functioning APEC-wide digital economy, having a consistent and standardized framework is an important foundation. However, regulatory frameworks tend to be ad-hoc and reactionary. One way to respond more proactively to technological advances, while achieving organic and multi-dimensional growth, is to transform the digital economy into a digital ecosystem. 

“The USC Marshall School of Business MBA research team did a great job of analyzing and developing insightful conclusions about this very complex and rapidly evolving area of digital trade,” Schorr said. “The findings and conclusions will be used by APEC business leaders and policy makers to help inform their perspectives on this extremely important area of international trade and commerce.”

Marshall’s MBA team presented to ABAC members as well as guests including government officials and trade association representatives. Each member of the 21-economy region fields up to three leaders representing a range of business sectors. These representatives are typically c-suite executives and/or board members of companies. The United States sent representatives from Microsoft and American Airlines.

“We received overwhelmingly positive feedback from our sponsors and other attendees,” Tufail said, adding that at least two of the team members were offered jobs as a result of the project. “Our work and professional presence impressed these leaders.”

USC Marshall ABAC Team

The Team

The boots on the ground: (from left to right) Timur Tufail, Christopher Hamermesh, Yuki Sakurai, Sherry Zhao, Michael Nieman, Saori Nakayoshi, Armughan Syed, Sam Bergman, Christy Liu, Pablo Kao, Amber Nguyen

ABAC team with manager

Doing Business with Business

The ABAC Team meets with various high-level managers during their time in Sydney.

(from left to right) Yuki Sakurai, Michael Nieman, Timur Tufail, Makoto Okubo (General Manager of International Affairs at Nippon Life Insurance Company), Saori Nakayoshi

ABAC opening

It Begins

The ABAC Conference begins.

ABAC Team

Marshall MBAs at Work

The USC Marshall MBA ABAC Team at work during the conference.

(front from left to right): Armughan Syed, Timur Tufail, Christopher Hamermesh

(back from left to right): Sam Bergman, Saori Nakayoshi, Michael Nieman, Sherry Zhao, Yuki Sakurai

 

USC Marshall ABAC Team

The Team

The boots on the ground: (from left to right) Timur Tufail, Christopher Hamermesh, Yuki Sakurai, Sherry Zhao, Michael Nieman, Saori Nakayoshi, Armughan Syed, Sam Bergman, Christy Liu, Pablo Kao, Amber Nguyen

ABAC team with manager

Doing Business with Business

The ABAC Team meets with various high-level managers during their time in Sydney.

(from left to right) Yuki Sakurai, Michael Nieman, Timur Tufail, Makoto Okubo (General Manager of International Affairs at Nippon Life Insurance Company), Saori Nakayoshi

ABAC opening

It Begins

The ABAC Conference begins.

ABAC Team

Marshall MBAs at Work

The USC Marshall MBA ABAC Team at work during the conference.

(front from left to right): Armughan Syed, Timur Tufail, Christopher Hamermesh

(back from left to right): Sam Bergman, Saori Nakayoshi, Michael Nieman, Sherry Zhao, Yuki Sakurai