Michael D. Smith faced more than a difficult market when he moved into the basement of his wife’s brokerage firm to start up a computer security business.

First a steam pipe in the ceiling broke, flooding the basement with scalding water. Then the sewage backed up into the office.

“When you start a company, you find space wherever you can, no matter how disgusting and smelly it is,” Smith says of the business, Liquid Machines Inc., which has grown from two to 60 employees since it debuted six years ago.

“We had to learn about how to do crisis management long before we were a funded company,” says Liquid Machines co-founder Vasanth Bala.

So when Smith moved into his corner office in University Hall in July to take over as dean of the Faculty of Arts and Sciences, professors and co-workers were confident that Smith’s business savoir-faire would give him a leg up in his new role.

“I thought it was an asset,” says University President Drew G. Faust of Smith’s business skills. “It brought a dimension of experience and understanding about management, but it also reflected an understanding of translating the kind of work we do at Harvard into a wider axis and the wider world.”

‘A DIFFERENT KIND OF TEACHING’

Smith, who says he never envisioned becoming a professor—let alone a dean—started working in the private sector as soon as he graduated from Princeton in 1983.

He began his career in an advanced engineering program at Honeywell Information Systems, where he worked with mini-computers.

But Smith says that the combination of teaching after-hours classes for Honeywell and the fact that many computer companies were going out of business in the 1980s inspired him to return to school and get his Ph.D.

“There was a lot of turmoil in the industry,” he says. “I was watching my friends jump back and forth from different companies, and I decided to jump back into academia.”

While pursuing his graduate degree at Stanford, Smith continued to work outside of the classroom. He both consulted and coached swimming, which he calls “a different kind of teaching.”

Smith says that his most memorable coaching experience came when he persuaded a 9-year-old girl, who “was convinced that she couldn’t do anything at the pool,” to swim in a meet.

Although the girl remained a good lap and a half behind the rest of the swimmers, the entire team came to the edge of the pool and started rooting for her, Smith remembers.

“Those are the kind of experiences that make it very worthwhile to be a swim coach, or any kind of coach, really,” Smith says.

‘REAL WORLD’ APPLICATION

After receiving his Ph.D. from Stanford, Smith interviewed both for faculty positions and for jobs in the private sector before deciding to join Harvard as a computer science professor in 1992.

When Smith was awarded tenure in 2000, Bala, a friend of Smith, convinced him to take time off from teaching to start a business.

After the Internet bubble burst, Smith recalls, no one was interested in funding their company.

Smith says the first 18 months without funding were “painful,” but allowed time to hone a message and figure out what to do without any supervisors.

Computer science professor Margot I. Seltzer, who started her own software company, says that she and Smith share similar attitudes about gaining work experience outside of the University.

“The beauty of the combination of academia and the private sector is that—particularly in an applied field like computer science—it means that your research activities are well-informed by the reality of what’s happening in the ‘real-world,’ as we call it,” she says.

“It keeps research relevant and keeps academia focused on problems whose solutions can actually help real people in society as opposed to simply creating papers at Harvard.”

Smith returned to Harvard as a full-time professor in the spring of 2002, but he continued serving as the chairman of the Liquid Machines board until he took over as dean of the Faculty in July.

“I always wanted to be a full-Faculty member,” he says. “I never wanted to be a full-time business person.”

AN ENGINEER AT HEART

Even in his capacity as a “full-Faculty member,” Smith has landed management roles, first as associate dean for computer science and engineering during a crucial period for Harvard’s new School of Engineering and Applied Sciences, and now as the chief of the University’s flagship school.

Venkatesh “Venky” Narayanamurti, dean of the School of Engineering and Applied Sciences, says that professors need a variety of skills if they want to succeed in administration.

“For deaning, having experience, including setting up an industry, is valuable because you deal with millions of problems,” he says. “A lot of deaning is actually problem solving.”

Smith says he likes research that involves interacting with industries and understanding what complications they face.

“I’m by training an engineer,” he says. “And an engineer is by training out there to improve the human condition and to tackle societal problems that can be improved through some piece of technology.”

“But there’s no time for it now as dean of the faculty,” he adds.

Liquid Machines Chief Executive Officer and President Michael A. Ruffolo also believes that running a company gave Smith invaluable management experience.

“As being part of the Liquid Machines team, I think he’s learned how to make decisions, how to set strategy, how resolve conflict, and how to communicate effectively,” Ruffolo says. “Those are skills that I’m sure he’s using everyday in his new job.”

Although Smith no longer serves as chairman of the Liquid Machines board, he still plays center field for the company’s softball team.

“He’s got a wicked homerun swing,” Ruffolo says.

—Claire M. Guehenno and Laurence H. M. Holland contributed to the reporting of this story.

—Staff writer Johannah S. Cornblatt can be reached at jcornbl@fas.harvard.