School Update

Global Forums in Asia and Europe

For those alumni who attended conferences in Taiwan and Germany last summer, it was an opportunity to hear fresh perspectives on business conditions in Asia and Europe.

The 1998 Wharton Asia Forum in Taipei, held June 11-13 in conjunction with the 5th Asian regional alumni meeting, addressed the theme “Innovation and Evolution: Asia’s Economic Emergence.”

Guest speakers included Paul Shih-Chun Hsu, chairman, Bank of Kaohsiung, who spoke on how “SMEs in Taiwan Have Evolved out of the Traditional Family Business Model;” Morris Chang, chair and CEO of Taiwan Semiconductor Manufacturing Co., Ltd., who offered his views on 21st century Asian technology industries, and Samuel C. Shieh, chairman, Board of Trustees, Chung-Hua Institution for Economic Research, whose topic was “Technological Innovation, Productivity and Economic Growth — A Challenge to the Profession of MBA.”

Harvey H.W. Chang, WG’77, president of the Wharton Club of Taipei and senior vice president and CFO of Taiwan Semiconductor Manufacturing, welcomed alumni to the event, held in the Far Eastern Plaza Hotel.

In addition, Wharton faculty led discussions that addressed specific aspects of the current Asian crisis, including marketing opportunities, investment strategies, and the role of technology and innovation.

Discussion at The Wharton European Forum in Munich on June 25-26 focused on the topic, “Labour at a Crossroads: Can Europe Rise to the Challenge of Global Markets?”

Henning Schulte-Noelle, WG’73, chairman of the board, Allianz AG, and Sir Paul R. Judge, WG’73, chairman, Isoworth Ltd. and ex-ministerial adviser, U.K. Cabinet Office, were keynote speakers.

A panel on global competitiveness included alumni Gerard Thulliez, WG’71, vice chairman Europe, SpencerStuart; Jacob Wallenberg, W’80, WG’81, chairman of the board, Skandinaviska Enskilda Banken, and Klaus Zumwinkel, WG’71, CEO, Deutsche Post AG, among other participants.

Alumni Jean-Pierre Rosso, WG’67, chairman and CEO, Case Corp., and Barry W. Wilson, WG’67, president, Europe, Middle East and Africa, Medtronic Europe SA, took part in a discussion panel on labour regulations and issues.

“Entrepreneurship, Venture Capital and New Initiatives for a Competitive Europe” included panelists Jean-Philippe Larramendy, WG’67, managing partner, Tocqueville International, France, and Richard Winckles, WG’71, partner, Schroder Ventures, U.K., among others.

Dean Thomas P. Gerrity attended both the Taipei and Munich forums.

News Flash!

For the third time in a row, Wharton has been named the number one business school in the U.S. by Business Week magazine in its biennial ranking of MBA programs.

The poll, published in Business Week’s October 19 issue, places Wharton ahead of Northwestern’s Kellogg School (#2), the University of Chicago Graduate School of Business (#3), the University of Michigan Business School (#4) and Harvard Business School (#5).

The magazine asked students to rate their school on such issues as teaching quality, program content and career placement. Corporate recruiters assessed the skills of the students and ranked the schools on their overall quality and the success rate of graduates in the recruiters’ organizations.

Wharton was ranked number one in the last two Business Week polls conducted in 1996 and 1994.

Wharton Honors Chair of India’s Reliance Industries

Dhirubhai H. Ambani, founder and chairman of India’s Reliance Industries, Ltd., was awarded the Dean’s Medal at a ceremony in Mumbai, India, on June 15.

Established in 1983, the Dean’s Medal is the school’s highest tribute for extraordinary achievement or service by individuals throughout the world.

The medal recognizes Ambani’s leadership in founding and building Reliance Industries into India’s largest, most widely traded and most profitable company. The citation specifically refers to the founder’s success in “revolutionizing the very concept of equity investing in India by creating wealth and value for millions of shareholders.”

Reliance Industries began in a one-room Bombay office and went public in 1977. Today the petrochemical and textile conglomerate has annual sales of $3.4 billion. Last year Reliance completed an expansion that has made the company one of the top ten petrochemical producers in the world.

Dhirubhai Ambani’s son, Anil D. Ambani, WG’83, is managing director of Reliance Industries and a member of Wharton’s Asian Advisory Board.

Among the previous 23 recipients of the Dean’s Medal are Shimon Peres, former Prime Minister of Israel, Reginald Jones, chairman emeritus of General Electric Co., C.F. Koo, chairman of Taiwan Cement Corp., Laurence Za Yu Moh, chairman emeritus of Universal Furniture Ltd. and Peter D. Sutherland, chairman, Goldman Sachs International and former Director General of GATT.

Class of WG’98 Scores High on Job Offers

The high-tech/telecommunications industry strengthened its position as the third largest employer of MBAs, with 5.9 percent of the class of 1998 accepting jobs in that sector as opposed to 5.6 percent in 1997.

Overall, 97.4 percent of the 1998 MBA graduates reported at least one job offer as of July 15. Almost that many — 97 percent — reported accepting jobs in 49 different industries.

Consulting continued to be the industry of choice for more than a third of the class — 35.5 percent, compared to 29.7 percent last year. Investment banking/brokerage attracted the second highest number — 28 percent, compared to 24.5 percent last year. Diversified financial services was the fourth highest, with 4.9 percent, and commercial banking the fifth highest, with 2.9 percent.

As might be expected given the strong trend in technology, the West coast — led by San Francisco — attracted a record number of graduates.

Of the 16.8 percent of graduates taking positions abroad, 7.3 percent were in Asia, 5.7 percent in Europe, 2.7 percent in Latin America and 0.3 percent in both Canada and Australia.

Positions with international responsibility were reported by 35.7 percent of the class.

Fellowship Established

The family of Houston A. Baker, Sr., WG’37, one of the first African Americans to earn an MBA from Wharton, has established a fellowship in his honor.

Baker, who also earned a master’s degree in hospital administration from Northwestern University, spent much of his career working for hospitals, primarily in the areas of budgeting and development. During the 1940s and early ‘50s he played a major role in establishing and directing a Red Cross Hospital in Louisville, Ky., (his birthplace) to provide health care services to African Americans.

Over the next two decades, he played a similar role in helping to assure quality health care for African Americans at the former Freedman’s Hospital in Washington, D.C., and at Howard University Hospital, which replaced Freedman’s.

Baker served on a number of hospital, church and civic boards until his death in 1983.

The fellowship will be funded with gifts from the Baker family — including Houston A. Baker, Jr., Albert M. Greenfield Professor of English at Penn — and friends.

MBA Applications Set Record

Driven by a significant increase in the number of international students, a record 8,313 people applied to the MBA class of WG’00, 11.4 percent more than last year.

The growth in international applications was most apparent in mainland China, India and other parts of Asia, as well as in Latin America. “We recruited in 19 countries this year, including first-time trips to Saudi Arabia, Peru, India and Egypt,” notes MBA admissions director Robert Alig, WG’87. “Our mission is to set the standard for global outreach.”

Of this year’s applicants, 45.7 percent are international, compared to 43.1 percent last year.

The average GMAT for applicants was 658, compared to 644 last year, while the average GPA was 3.38 compared to 3.36 in 1997.

The total number of admitted students was 1,087 compared to 1,085 last year. This year 33.1 percent of that total is comprised of international students, compared to 31.2 percent last year, and 31.3 percent were women, compared to 28.8 percent last year. The average GMAT for admitted students was 691, compared to 678 last year, while the average GPA was 3.5 compared to 3.46 in 1997.

This year’s yield — the number of students who accept Wharton — is 70.4 percent, compared to 73 percent last year. That translates into 765 students on campus this fall, of whom 32.0 percent are international (30.4 percent last year), 30.2 percent are women (27.4 percent last year), 5.6 percent are African American (5.1 percent), 9 percent are Asian American (8.3 percent), 3.5 percent are Hispanic American (3.8 percent) and 0.1 percent are Native American (no change).

“The minority student percentage overall is 18.3 percent this year, up from 17.4 percent last year,” notes Alig. “The number of women is also higher, due in large part to targeted outreach supported by a group of current students.”

The strength of the applicant pool “clearly shows how competitive getting into Wharton has become,” Alig states. “In 1994 we had 5,019 applications. This year it was more than 8,300. Our admit rate is at 13 percent. Looking at virtually any index, our applicants have to realize they are competing not only against more people but against stronger people.”

In terms of the school’s active international recruiting program, “Wharton’s mission is to be an international MBA program that happens to be located in America,” he adds. “We are preparing students for a global economy. That includes being surrounded by people with a global perspective.”

Undergrad Applications: On the Leading Edge

Applicants to Wharton’s undergraduate class of 2002 totaled 3,855, an 11.3 percent increase over last year’s 3,464.

Of the total applicant pool, 17.6 percent were admitted, compared to 20.8 percent last year. “It was a very competitive year and we were more selective,” notes Sue Kauffman DePuyt, director of student services and administration in the undergraduate division.

The size of the incoming class is 459 students, compared to 506 last year. This year’s yield is 67.7 percent, compared to 70.2 percent in 1997.

For the single degree program, applications totaled 3,063, 12 percent higher than last year. The number of matriculants is 378, down from 417 last year, a decrease that reflects in part the fewer number of students admitted — 527 compared to 560 in 1997.

Applicants to the joint-degree Huntsman Program in International Studies & Business (IS&B) totaled 439 compared to 399 last year, and 37 students are matriculating, the same as last year. In the joint-degree Jerome Fisher Program in Management & Technology, applicants totaled 336, compared to 306 last year, and 40 students accepted compared to 46 last year.

In the joint-degree nursing and health care management program, 17 students applied compared to 23 last year, and four accepted (six last year).

The average SAT score for all undergraduate matriculants was 1426 compared to 1404 last year. Scores for the single degree program totaled 1409, compared to 1386 in 1997.

Matriculants in the IS&B program and M&T programs had average SAT scores of 1501 and 1515, respectively, compared to 1517 and 1483 in 1997. Average SAT scores for the nursing/health care program came in at 1399 compared to 1374 last year.

Women make up 38 percent of this year’s class, compared to 32 percent last year.

Among the members of the class of W’02 are four students from the Leadership, Education and Development Program (LEAD) at Wharton, and an additional 11 students from 10 other LEAD programs in the U.S. “It’s a very strong showing,” states Harold J. Haskins, director of Wharton’s LEAD program and head of student development support planning at Penn, “and an indication of the significant number of high quality students in the LEAD program itself.”

The LEAD program provides talented minority high school juniors with an intensive, month-long introduction to the world of business.

New Faces on Faculty

The 14 new faculty at Wharton this year bring with them a variety of research interests ranging from financial accounting, game theory and international non-market strategy to consumer shopping behavior and privatization.

Joining Wharton as an associate professor in the marketing department is David R. Bell (PhD‘95: Stanford), formerly an assistant professor at UCLA. Other new faculty, all assistant professors, include:

• Accounting: James J. Chang (ABD, Harvard)
• Finance: Bilge Yilmaz (ABD, Princeton)
• Insurance and Risk Management: Kent Smutters (PhD ’95: Harvard), formerly principal analyst, Congressional Budget Office n Management: Beth A. Bechky (ABD, Stanford); Witold J. Henisz (PhD’98: Berkeley); Nicolaj Siggelkow (PhD’98: Harvard); Julie Wulf (ABD, Columbia)
• Marketing: Gavan Fitzsimmons (PhD’95: Columbia), formerly assistant professor at UCLA
• Operations & Information Management: Balaji Padmanabhan (ABD, New York University); Christian Terwiesch (PhD’97: INSEAD), formerly project scientist at the University of San Diego
• Public Policy & Management: Felix Oberholzer-Gee (PhD’96: University of Zurich)
• Statistics: Abraham J. Wyner (PhD’93: Stanford), formerly visiting professor at Berkeley, Elaine L. Zanutto (PhD’98: Harvard)

Book Report: Natural Hazards and the Insurance Industry

The effectiveness of insurance coverage for natural disasters like earthquakes and hurricanes — and how insurance programs can be used with other policy tools to encourage better loss reduction measures — is the subject of a new book co-edited by a Wharton professor.

Paying the Price: The Status and Role of Insurance Against Natural Disasters in the United States (Joseph Henry Press) — by Howard Kunreuther, the Cecelia Yen Koo Professor of Decision Sciences and Public Policy, and co-director of the Wharton Risk Management and Decision Processes Center, and Richard Roth, Sr., a retired insurance executive and property/casualty actuary — discusses the dramatic increase in insured losses from natural disasters since 1989. The book also addresses the concern that insurers have about their ability to provide coverage against more such events in the future, and the role of reinsurance and private/ public sector initiatives at the state and federal levels, among other topics.