Better Brand of Leader

September 1, 2006

Howard Phanstiel's $5-million gift—the largest one-time contribution ever made to Maxwell by an individual donor—creates a new faculty chair serving Phanstiel's vision for promoting great leadership in the public sector.

In the days following Hurricane Katrina, PacifiCare Health Systems donated $1 million to Texas authorities to assist the thousands of evacuees who sought shelter at the Houston Astrodome. However, as days turned to weeks and months, PacifiCare's CEO, Howard Phanstiel '70 B.A. (PSc)/'71 M.P.A., became increasingly dismayed by the response to the disaster.

"In the aftermath, I was struck by the lack of good leadership skills and decision making at all levels of government," he says. "And the cumulative effect of that weak leadership has been disastrous."

Now, a year later, Phanstiel and his wife, Louise, have given the Maxwell School $5 million to bolster the training of public leaders. The gift, the largest one-time gift by an individual in Maxwell School history, funds the Howard and Louise Phanstiel Chair in Strategic Management and Leadership—created to solidify the Maxwell M.P.A. program's top national ranking and its training of public managers. It is the first endowed chair for the department.

As such, according to Dean Mitchel Wallerstein, the Phanstiel gift is not only substantial and generous, but transformational. "It is my hope that the establishment of the Phanstiel Chair will prove to be one of those truly pivotal developments in the history of the School," he says. "A gift of this magnitude is unprecedented at Maxwell, and will enable us to maintain our hard-earned reputation as the "flagship" school in the field of public management."

According to Stuart Bretschneider, chair of public administration, the person filling the Phanstiel Chair will explore leadership principles from the public and private sectors, and apply those principles to the management of public problems. The chairholder will enjoy a national reputation and have peerless experience in strategic management and leadership. "This is a tremendous boost to our commitment to excellence in public management and public leadership," Bretschneider says.

“[The goal is to] train leaders who are ethical, strategic, and innovative thinkers – people who have a vision of achieving something extraordinary, as well as the strategy to execute it.”

Howard Phanstiel '70 B.A. (PSc)/'71 M.P.A.

Phanstiel says the chair will recognize the importance of thinking creatively and understanding how to work across disciplines. The goal, he says, is to "train leaders who are ethical, strategic, and innovative thinkers—people who have a vision of achieving something extraordinary, as well as the strategy to execute it. There are a lot of people who have vision, but drop the ball when it comes to execution. I think we saw some of that with Katrina."

Phanstiel owes his own leadership skills to his Maxwell M.P.A., he says. "The Maxwell School trained me to look at both sides of an issue and to organize a point of view," he explains. "It's not easy to see things from both sides. Maxwell taught me to think very critically about issues and that's been very useful to me throughout my career."

Phanstiel started out in the public sector, working at state budget offices in Wisconsin and Illinois, before becoming managing director of management and budget for the U.S. Health Care Financing Administration.

He then made a jump to the private sector, holding several banking positions. Then, as executive vice president for finance and information services at California-based WellPoint Health Networks, Phanstiel led efforts to complete a $3.5-billion recapitalization and expansion. He moved to ARV Assisted Living, a $150-million company with 60 assisted-living communities nationwide serving 8,000 residents. As chairman and CEO, he led an expansion that included the acquisition or creation of 16 communities, which added nearly 3,000 residents.

Phanstiel joined PacifiCare as executive vice president and CFO in July 2000, and three months later was named interim president, a position that soon became permanent. Under his leadership, PacifiCare became a diversified consumer health organization with revenues of $12 billion and record profits. PacifiCare was acquired by UnitedHealth Group at the end of 2005. Phanstiel will retire from the company in January 2007.

He says his gift to Maxwell is both an endorsement of the University's mission and vision and a shot in the arm to an academic program he deeply believes in.

"The intent is to enable Maxwell to maintain and expand its lead as one of the best schools in the country," says Phanstiel, "at a time when the country most needs it."

By Renée Gearhart Levy