Where Are They Now?
Kenneth Merchant
Merchant
Photo by Danny Turner
When Ken Merchant arrived to begin teaching at HBS in 1978, he knew there was no other place he wanted to be. “At the time, HBS was the Mecca for the subject area about which I wanted to do research — management control systems,” recalls Merchant, who’d earned his Ph.D. from the University of California, Berkeley, earlier that year. “Bob Anthony, the father of the management control systems field, was teaching at HBS, as were Dick Vancil, Bill Bruns, and John Dearden. These were the giants in the field at the time. There was no better place for me by far.”
While Merchant, who now holds the Deloitte & Touche LLP Chair of Accountancy at the University of Southern California’s Marshall School of Business, looks back at his teaching career at HBS with fondness, he has no regrets about leaving when he did in 1990.
“I learned a lot about teaching while at HBS,” says Merchant, who taught the first-year MBA course in management accounting and later a second-year elective in management control systems. He also taught in a variety of Executive Education programs. “I’d never taught using the case method, so that took some adjusting. I was never so terrified about anything as I was heading into the MBA classroom that first day,” he recalls.
But there was another challenge to teaching accounting courses: making them lively. Merchant says he started by getting students to understand the economics of a transaction, then looking at the accounting for that transaction. “Then I’d say, ‘Isn’t this ridiculous? Why do they do it this way?’ It’s a useful and fun way to teach business, accounting theory, and the accounting ritual.”
In 1990, Merchant accepted an offer from USC’s Marshall School, where he has taught mostly MBA students and executives. And he has pursued his interest in management control systems through research focused on the various issues related to the design and effects of performance measurement, evaluation and incentive systems, and, more recently, corporate control and governance systems.
“In one of my projects, I’m trying to link nonfinancial and financial measures of performance,” he says. “How do you design a performance measurement system that is both useful for monitoring purposes and motivates people to do the right thing? We know that financial measures of performance are lagging indicators. Can we find something that’s more reliable or timely? It’s a pretty hot topic in business now.”
In addition to teaching and research activities, Merchant served as dean of USC’s Leventhal School of Accounting from 1994 until 2001 and as senior associate dean in charge of executive programs at the Marshall School in 2003–04. He has also served on several corporate boards and worked as a consultant to dozens of organizations over the years.
This year, Merchant, the father of two school-age daughters, is on sabbatical and developing a new line of inquiry focused on corporate governance. In his spare time, he coaches his daughters’ basketball and softball teams and tries to find time to play golf. The 75-degree California weather he was enjoying in late December helps explain why the West Coast is home sweet home.
