Class In Session

In this issue, interviewer Steve Player speaks to legendary costing professor Dr. Charles Horngren of Stanford University, whose market-leading textbook, Cost Accounting: A Managerial Emphasis (first issued in 1962 and now in its 13th edition from Prentice Hall), has been used to train more CFOs and other finance executives than any other. In this rapidly changing world, Dr. Horngren provides sage advice on what remains timeless and important in finance's quest to add value.

Player: Dr. Horngren, let's start with some quick background on your career ...

Horngren: My teaching began in 1948 while I worked on my undergraduate degree in accounting at Marquette University in Milwaukee. I was enrolled in the College of Business Administration. During my junior year, I began tutoring World War II disabled vets who were homebound and needed help. I also was tutoring basketball players. This was when I learned that teaching was the route I wanted to go.

Upon graduating, I went to work for Peat Marwick & Mitchell in my hometown of Milwaukee. After reconciling bank accounts for 12 hours one day, I looked at the want ads and saw a position for an accounting instructor. I decided to go for it, so I wrote a response. Three days later, I got a call and was hired for $50 more a month than I was making. I instructed for eight months and then went to Harvard to get my MBA. The summer after going to Harvard, I came back and taught in Milwaukee.

I was eventually hired by the University of Chicago as an instructor under the condition that I'd work on my doctorate at the same time. In those days, this was the requirement for a Ph.D. I did that, spending three years in Chicago. I then went back to teach at Marquette and back to Chicago to teach for seven more years (10 in total) before going to Stanford.

Player: What inspired you to go from Chicago to Stanford?

Horngren: I loved Chicago -- not specifically the city, but the university -- and my colleagues there. It was a stimulating place. But when Stanford offered me the job (1965--66), they first offered me a visiting professorship for a year. I thought, "What do I have to lose?" They had a new dean and were recruiting some very capable people. Initially, my wife was not that keen on Palo Alto, as she had lots of family in Chicago.

In February, the dean made me the offer to join Stanford on a full-time basis. The weather and the environment did have some influence, and the dean at the time, Ernie Arbuckle, was very persuasive. My wife quickly learned to love this area. We have been married 55 years.

I told my Chicago colleagues that if they could airlift the University of Chicago and transplant it to Santa Barbara or somewhere like that, I'd still be at Chicago.