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Dollars and Sense in Israel's Ivory Tower

The recent appointment of former Cellcom CEO Amos Shapira as president of the University of Haifa has angered academics who think that one of them - and not a businessman - should be serving in that post.

Businessman Amos Shapira hasn't even taken up his new post as president of the University of Haifa, but opposition to his appointment has been so virulent that his term can be expected to be very turbulent.

Once the decision was announced a few weeks ago, Jewish-American businessman Leon Charney, who chairs the university's board of governors, fired off an angry letter to Ami Ayalon, chairman of the university's executive committee.

Amos Shapira - Tomer Appelbaum
Tomer Appelbaum

"As I told you last week when you were in my office," Charney wrote, "I wished to be part of the search in the Committee, I understand that you did not follow my commandments. Furthermore, you were asked that Yossi Ben-Artzi [one of the other shortlisted candidates] would be nominated in my name. This was totally ignored ..." Charney informed Ayalon that he would work to invalidate the appointment.

The man sent to appease Charney was the university's incumbent president, Prof. Aaron Ben-Ze'ev. Eventually, the American changed his mind and promised to meet with Shapira.

In response to a query from Haaretz, the university stated, "Word of the search committee's decision came to the attention of ... Mr. Leon Charney, who has been a warm and loyal friend of the university for many years. Upon receiving the announcement, Mr. Charney sent a letter that was based on a misunderstanding, and once this was explained to him, he retracted the letter."

The appointment of a businessman to a position that is academic in nature is far from obvious. Perhaps this was the reason behind the letter written by Giora Shalgi, a member of the university search committee - and a businessman - and circulated among other committee members in late January, a full month before Shapira's selection was announced. Shalgi, also a member of the executive committee, wrote that the university is in need of a change. Shalgi asserted that this change had to be effected along organizational lines, via a transition from a scholastic perspective to a business-oriented one.

It is possible that the university's choice of veteran businessman Amos Shapira, 62, who most recently served as CEO of Cellcom, can thus be interpreted as a first step on the path to such change. Shalgi, president and CEO of Rafael Advanced Defense Systems for six years, until 2004, cited in his letter the appointment in 1987 of an external CEO to the armsmaker (Maj. Gen. Moshe Peled ), who pulled Rafael out of the crisis in which it had been mired.

Shalgi predicted that there would be criticism of the appointment of a candidate from outside, and wrote, "We are considering taking a step that the majority of people within the organization see as being threatening and unnecessary." Even the terminology Shalgi employed - calling the university an "organization" - is reflective of the changes in store for the school, and perhaps other academic institutions as well.

Indeed, several local institutions of higher learning were apparently surprised by the fact that none of the academic figures who vied for the Haifa post were selected, among them former rector Prof. Yossi Ben-Artzi; aerospace engineer Prof. Daniel Weihs of the Technion-Israel Institute of Techology in Haifa; and Prof. Nava Ben-Zvi, president of Hadassah College in Jerusalem.

Shapira, who has a master's degree in industrial management from the Technion, started out as a salesman at Sano in 1973. He went on to become CEO of Hogla, a position he held for some two decades, and in 2002 became CEO of El Al, which was then still a government-owned company. He resigned three years later, mere days after the Borovich family gained control of the airline.

Shapiro held his recent position at Cellcom for six years, until late last year. During his tenure, he managed to turn the company into a cash cow, but this was mostly an era in which the cellular phone industry was generally monopolistic and noncompetitive. During his years at Cellcom, Shapira received salaries, bonuses and stock options amounting to some NIS 60 million. As president of the University of Haifa, he will earn about NIS 60,000 a month.

When Shapira left Cellcom, Amir Teig described him in TheMarker as being an outstanding manager who aspired to be a public figure in Israel, and to that end someone who sought to maintain a high media profile. Teig added, however, that "as a public figure, Shapira failed, as he ... was concerned solely with his own shareholders. Along with his two competitors, he consciously and adversely influenced the level of service to cellular customers ... Shapira looked on as his company grew to become reviled, and did not stop it."

Amos Shapira did not respond to this article.

Colorful exec

One way of assessing Amos Shapira's managerial practices is to consider one of the first moves he made as Cellcom CEO: canceling profit-sharing bonuses to company employees. He himself said, in an interview on the Mako website in January 2011: "There is a thin line between being aggressive and saying what you want to say in a manner that leaves no room for misunderstanding - and the point at which you become callous. It is here that I often transgress, and that is not okay."

In any event, Shapira is perhaps one of the more colorful business executives in the country. He has participated in public celebrations featuring Rabbi Yaakov Ifergan (the so-called "X-ray rabbi" ), rides a Harley-Davidson motorcycle and is quite sensitive about what is reported on him in the media. He told members of the University of Haifa's search committee that he understood the fact that academia is not a commercial enterprise.

Prof. Danny Gutwein, of the university's department of Jewish history - and a vehement critic of privatization in Israel - sees Shapira's selection as another step in "the Finance Ministry's hostile takeover of the universities."

Gutwein told Haaretz that the search committee's "success" in not finding a candidate for president from among the country's academic community is more than just a warning sign for the Haifa institution and the local academic world in general. In its decision to opt for a product of the private sector, he says, the search committee in effect boosted the approach of the Finance Ministry, which has strived for years to diminish the influence of "the professors," and to coerce them into adopting a more businesslike administrative model of management at their institutions.

"The premise that a commercial-business administration will 'rescue' the universities is an addictive bit of propaganda," Gutwein explains. "Essentially, as a consequence of the budget cuts the Finance Ministry forced on the universities, they have been administered as a 'business' for about two decades. And yet, experience shows that the more the universities adopt business logic, the greater the crisis in which they find themselves. The Finance Ministry and its propagandists explain the fact that the crisis has continued by saying that the commercialization steps were insufficient, and that they must be enforced more stringently. The search committee [in Haifa] succumbed to this delusion, and the recipe it is proposing will only exacerbate the university's problems instead of solving them."

Says Haifa University historian Prof. Gur Alroey: "In principle, I think we have to manage ourselves, and we do not have to bring in public figures, or businessmen from the outside, to replace us. It seems strange to me that out of the entire cadre of leadership in this university of tenured professors, there isn't even one talented individual who could take on this position. We will become the only university with a president brought in from outside."

Alroey adds that he has no personal objection to Shapira, but "in the academic world businesspeople are ranked quite low down, in terms of ethics and values. It doesn't make any impression on us that he made money; it doesn't earn him any extra points."

Proponents of Shapira's appointment note his role in recent years as chairman of the Israeli Friends of Tel Aviv University as evidence of his positive relationship with the academic world.

Small hurdle

One member of the search committee in Haifa says: "Amos related that his mother was a teacher and that he cares about the subject of education. He did his homework, and declared that he was very interested in the position. Most of the committee members were very impressed with his record. As for concerns of intervention in academic matters, I can understand the fear, but in my opinion it depends on the person. Shapira will not get involved in that."

Prof. Dany Leviatan, a mathematician who was rector of Tel Aviv University and knows Shapira from his work with the friends group, admits he was surprised by the appointment, but was also happy about it: "Amos brought a lot of added value to his position as president of the Israeli Friends of TAU, and I feel he will bring such added value to the University of Haifa."

Leviatan adds that Shapira helped to strengthen the connection between the local business community and the TAU faculty, and set up a business-academic club that organizes monthly meetings between members of the two groups. As for the fear that Shapira will intervene in academic matters, Leviatan believes the new president is "most decidedly the type of person who knows not to meddle in those affairs. It's something that I assume some people are concerned about, but I would not be worried about it at all."

Gutwein's response: "Saying that a university president will not meddle in academic matters is like saying that a chef will not cook. The university president heads the system and his decisions have a strong influence on the academic atmosphere, and it is therefore important that he be an academic."

Members of the search committee who favored Shapira's appointment note that the Technion also has presidents from outside the ivory tower - including Maj. Gen. (ret. ) Amos Horev (1973-1982 ), who was considered a success, and Maj. Gen. (res. ) Amos Lapidot (1998-2001 ), who was considered a weak appointment. Other committee members mention the former president of Ben-Gurion University, Prof. Avishay Braverman, an economist by training but someone who did not emerge from the academic world, as someone who succeeded in bringing about welcome changes there and is well respected.

Like Prof. Shlomo Mor-Yosef, former director-general of the Hadassah Medical Organization, Braverman, currently a member of Knesset, was offered the president's position at the University of Haifa, but turned it down. Braverman says that while it is true that at leading universities in Israel it is customary for the president to come from a research-academic background, "at the same time, I am certain that the search committee, which included respected professors, chose Amos Shapira in spite of this, because of the numerous good qualities with which he is blessed."

A former senior official at the Council of Higher Education told Haaretz that in his opinion, Shapira will be capable of spearheading the financial change the university. "If this change is not made," says the former official, "they will soon be left with an academic institution, but without any financial means, so what would that be worth?"

In recent years the University of Haifa has suffered from serious fund-raising problems due to the lack of a science program and other factors.

One small hurdle to the appointment still remains: Shapira was chosen, but a clause in the university constitution states that the president must live in or near Haifa. Shapira is a Tel Aviv resident and has already announced that he does not intend to move. In a statement issued by the university in November 2001, this condition was underscored, although a footnote stated, "The issue of residence in Haifa is undergoing a process of discussion and reappraisal."

The University of Haifa gave the following response to a request from Haaretz: "The search committee, which comprises four academic representatives and five public representatives, acted in accordance with the university constitution, and following prolonged discussions, selected the person it deemed to be the most worthy candidate. The selection procedure has not yet ended, and will continue in accordance with the constitution of the university. The requirement that the president of the university live in Haifa is well known to those who offered their candidacy, and the university will act on this matter in accordance with its constitution."