Jim, to start, I'd like to talk about the new dean at Indiana. John Rau, as many well know, stepped down as dean of the school to return to the banking business and has been replaced by Dan Dalton. It's my undertanding that Dean Dalton has been at the helm for the last eight months. Has the school's direction changed at all under his tutelage? Has it changed at all from Rau's?

Because he was actively involved in the administration with Dean Rau, he's really continuing some of the things that Dean Rau started. Dan had served as associate dean prior to being named to interim dean. Prior to that, he was a faculty chair for the MBA program.

What types of endeavors is he leading?

One of the biggest things on his plate is the process of putting the plans together for a new building for the b-school. It was recently approved by the state legislature. We're currently working with the architect, and we'll be breaking ground in a year to two years. We're also in the process of getting funding from benefactors. So, the undergraduate program will remain in the old building (currently housing the MBA program) and the new building will be exclusively for graduate business and executive education. We're anticipating that the new building will be ready by 2001.

Well the school has undergone quite a facelift over the last couple of years. For example, I understand that Indiana has a rather unique grading policy in which MBAs only receive two grades -- one for each semester -- during the first year. Why the unconventional grading system?

A couple things. Let me start by taking a step backwards .. Their (students') curriculum in the first year is a core curriculum like most schools, but what's unique is the four cohorts comprised of 65 - 70 students that are then each broken down into teams of 4 - 5 people. Each cohort is led by a team of five faculty members to represent different disciplines included in the core. They put together a syllabus that tackles, week-by-week, the core requirements necessary in a graduate business education. So that tends to do away with any redundancy and sometimes it allows faculty to teach together. The bottom line is taking an integrated approach to the curriculum and grading. Students still have exams, but the hope is that everybody needs to do well across all of the components of the core, but they [faculty] want students to do well overall. Focus energy in weaker areas but let the education be balanced.

The grade is a GPA that reflects their success across all of the components of the core. It is a culmination of their success on exams, projects, papers through each of the components that are part of their courses, but then also their participation/contribution as seen by faculty, students, and teammates is taken into account. The fall semester is a foundation core and the spring is a functional core.

Also, there is the recent addition of Focus Academies to the curriculum. Can you tell me a little bit about them? How many are there?

Right now we have five academies: The Investment Managment Academy, the Sports and Entertainment Academy, the Internet and New Media Academy, the Consulting Academy, and the Entrepreneurship Academy. On the horizon is the Investment Banking Academy.

What do they entail?

In essence they're almost a hybird between the academic program and extracurricular activity. They're concentrated around specific areas of professional interest. Students apply and have to submit an application once they're here, and there's a selection process. They aren't designed for someone who is exploring the field, but rather, they're designed for a person that has the passion for it because they (those who are exploring) can get exposure to these areas through the regular curriculum and MBA clubs. The academies are really for the person who says 'I want to get into investment managment,' for example.

So these academies pull together key faculty members who pull together an advisory board of leaders in industry. Some are CEOs or have other leadership positions. And they serve as a network or resource to the academy members. The different academy advisory boards will come out a couple times a year to provide info to the students and listen to students giving presentations. Our hope is that these academies will bolster internships and employment opportunities.

Sports and the Internet academies are creating a niche for us and providing a concentration that not many other schools are providing right now. They're providing our students with a competitive edge.

How competitive is it to be accepted into these academies?

It depends on the academy. But academy membership is kept small. I would say that the average academy size is about 20 persons.

And how long have these academies been a component of Indiana's MBA program?

They're now entering their third year. The Internet and New Media Academy went through a bit of a change, however. During its first two years it was called the "Digital Communications" Academy.

What has the reception been like? Have they been popular with the students and faculty?

It has been strong for the people who have an interest in that. And it has been something that recruiters have shown interest in.

What other innovations have been added to the curriculum recently? Our 1996 rankings showed that IU was voted the worst in elective teaching. Has the school focused its efforts to try and improve this situation?

Certainly over the last couple of years we've been doing some new hiring to get some top-notch professors to add to our second year. A number of departments are revitalizing and making some adjustments to their curriculum. The marketing department has really put together a whole new curriculum for second-year marketing majors. Probably a new thing related to the second year is something called the "policy core," and in the past there have always been a number of stand-alone required courses. What we've done is pull together those classes into a policy core that is team-taught, meets a couple times a week, provides capstone experience, and touches on a number of different areas: law, ethics, international issues, strategic concerns . The "policy core" is being launched this year.

Indiana's applications have been steadily rising over the past couple of years -- a trend in line with most of its peer schools in the top 25 -- peaking to a high this year at 1,791 apps. What factors can you cite for this rise?

Our applications have hit a recent peak, certainly the highest in a number of years. Probably a couple things are responsible for the rise. We have really tried to do some additional outreach. We're doing a lot more traveling on the road. I think when you're a progam located in Bloomington, Indiana, a lot of people tend not to think of a credible b-school in a college town. So we have to work harder. We are doing a lot of travel both internationally and domestically. Besides participating in MBA forums, we're visiting cities and offering interviews, and hosting receptions where we'll invite alumni to participate. We have always been well regarded for our customer service, so we try and step this up as much as we can.

How big is this year's class and how many people did the school need to admit to fill the spots? What was the yield?

260. This year we offered admission to 665. That's a 39% yield.

Has that changed at all?

Our yield as been somewhat inconsistent. I haven't quite figured out why yet.

Processing more applications must be somewhat hard logistically. Are you rethinking the evaluation process at all to adjust to this larger number of apps?

No not at all. The only things that we have done as apps have risen is changed our application deadlines to help both spread out the applications and workload in terms of reviewing them. We also feel this allows us to be more competitive, to give applicants the opportunity to hear back so that they know what their positions are.

In the six years prior to last year, the first couple years we had rolling admissions, then three or four years ago we had one deadline. The last two years we've had an early January deadline, and a March 1 deadline for domestic (applicants). This year, our first deadline is December 1, our second is January 15, and our final is March 1.

B-schools preach about "fit" that an applicant and school has -- that each school is different and has its own idiosyncrasies. What type of applicant "fits" into Indiana?

Because of the nature of our curriculum, we're looking for people who are willing to be cooperative and work in teams, learn from and teach their classmates. As a nice example, we have accounting as a part of our core and obviously we have people who are CPAs and others who have a limited background in that area. Well for as long as we've had this core, the CPAs have traditionally taken time to do Friday review sessions for the class that they're sitting in as well.

You mentioned that Indiana has ramped up its traveling... What recruiting efforts has Indiana done to cater to the international student?

We started pretty easy by just enhancing the information that we provided and broadening our response to a wider range of inquiries. We have created two viewbooks -- one for domestic and one for international. The international applicants had even greater questions about the curriculum, housing, geography, student life .. so we've created an international viewbook that addresses more of those questions. We have, as I said, stepped up our outreach with internationals by traveling to Europe and Asia as part of the GMAC Forums. This year we're also sponsoring an event that will take us to Milan, Paris, London, and Berlin under the umbrella of a European-based organization named "MBA Events." There are about 25 U.S. schools that are participating and another 40 - 50 European and Asian Schools on top of that.

We will also participate with a group of 30 - 33 schools and hit Caracas [Venezuela], Sao Paulo [Brazil], Buenos Aires [Argentina], Bogota [Columbia], Monterrey [Mexico], and Mexico City. We've had such tremendous success in Asia and we're trying to maintain that success but also build our pool in Europe and South America.

Where are you seeing the sharpest international growth?

Asia. This year our international applicant pool increased by 46% and our domestic increased about 25% - 26%. And a lot of that growth currently is Asia. This year all of the Latin American countries are all new to us. We're going to Singapore for the first time this year as well.

What types of efforts have you taken to cater to female candidates?

This year we're thrilled that 31% of our applicant pool is comprised of female applicants. And we were working very hard since we had such a small female class the year before, which was 21% [this year's female class in 26%].

Can you cite any factor[s] that contributed to this rise?

Well certainly the women in the program, both in the graduate business program at large and in womens' organizations, were more than willing to make contact with prospective students that have been admitted. We put together a four-color brochure called "Women in Business" that profiles some of our successful women alumni, and current students, and talks about what the situation is like here. So it has been a combination of things.

Is there a pre-application process at Indiana? Do students have a chance to speak informally with admissions officers or alumni to get a better feel for the kind of school IU is?

We provide many opportunities. We have a campus visit program that we run every day. Thirty-five students -- called the "admission council" -- host (prospective students), take them to class, and show them around. And they can have an admissions interview, which is evaluative.

How many people would you estimate took advantage of this campus visit?

Last year about 600 people took advantage of it. And then certainly through the receptions and interviews we did on the road, both in conjunction with people in the MBA forums and trips we did on our own, we provide information, answer questions, and interview.

Is there a specific order in which you and the rest of your admissions team reviews an application?

We don't have a specific set of guidelines in terms of 'read this first' because our philosophy is to take a holistic look at the application. We don't assign weights. We're taking a grand look at what the entire applications are showing: experience, academic work, and then we're trying to assess whether the candidates will be academically successful, have the potential to be good managers and business leaders, and have the ability to be team players. Certainly if there is a deficiency somewhere on the application, we're looking to see if there is a strength to balance that out.

How much weight does the GMAT carry for an application?

It's certainly an important factor, but since we don't assign weights it's difficult to say what it is in relation to everything else. Certainly we'll look at the GMAT and the academic record together. It's like for someone who has a poor academic record and poor GMAT score, even if they have strong work experience, if they don't have an indication that they will be able to handle the rigors of the MBA program, this isn't going to be a good place for them.

I understand that interviews are strongly recommended at your school, though only 50% interviewed for the Class of '99. Why is this? Is it because you have to come to the campus to get it done? Do alumni participate?

We don't use alumni for interviews, so in order to interview, you need to either come to campus, but as I mentioned we offer interviews when we travel to MBA Forums, and we make trips back to the major areas of the country.

Why did only 50% interview? Do you have any theories?

No idea. We encourage applicants to interview because certainly when it comes to the interview not only is it of value to us to assess their skills, their fit, and give us the opportunity to get to know the applicant beyond what we see on paper, but it's also important for the candidate to get to know us. We want to see if we're a good fit for them. Especially for applicants from the West and East coasts who are making the trip to Bloomington to see whether attending school here is a good idea. It (coming to Bloomington to visit the school and interview) can make a significant difference in the applicants' decision-making process.

How should applicants prepare themselves for the interview?

Hopefully they've given some thought both to their reasons for pursuing an MBA and also for considering Indiana. Our interviews, they aren't rapid fire questions. I like to be more conversational and get to know them more in a relaxed interview. So I think applicants need to be open about their goals and take advantage of the time to ask their questions as well.

Do you interview?

Yes. I interviewed probably over 100 last year.

What do you ask, generally?

It's pretty straightforward: why at this point into their career are they interested in an MBA, where do they hope it will take them .. and their responses will generally elicit more questions from me.

Indiana asks its applicants to complete three essays with a fourth optional, right?

Yes.

Has this changed at all from years past?

No.

What do the essays ask?

Well, the first question that's mandatory asks them why they want an MBA and how it will help them achieve their professional objectives -- sort of their short-and-long-term goals. For the next two, they have their choice of two out of three .. Assume you are a successful executive in the process of hiring a new manager, what questions would you ask? Suppose you had to choose three people to travel with you on a cross-country auto trip. Who would you choose and why? And lastly, describe a situation in which you felt compelled to take a stand against the majority. How did the experience strengthen your understanding of leadership?

The optional essay asks the applicant to provide anything else we should know that hasn't already been stated.

Are there word limits?

We ask them to try to keep it to one side of a page, which for us is about 300 words. Every year there are a handful of applicants that provide a whole lot of information that we just don't need. Certainly a part of it is to get a sense of their writing skills. Their topics tell us about their judgment and maturity, but it's (the essay) also about communication. Can they be concise? The question I ask myself after reading an essay is: Do I know anything more about this applicant after having read this essay than from when I started?

How many recommendations do you require?

Two. But candidates can submit more than one if they so choose.

Ideally, what's the best type of split between recommendations? What's your preference as far as how they should be broken up?

We don't have a strong preference. I value recommendations from people who have had contact with the applicant and who can provide insight into their management potential or even their academic potentional. Every once in awhile you'll get a letter from a CEO who the applicant doesn't really know. A fancy title doesn't help me at all; it's the depth of knowledge and the ability to make the recommendation worthwhile that works.

What amount of work experience are you looking for from a candidate?

Definitely we'd like to see at least two years. Our average for this year is 4 1/2 years.

This year, about 3% of Indiana's Class of 1999 had no work experience -- that's down from 5% just last year. Is it getting harder/more competitive, then?

It's a combination. Certainly as our applicant pool gets larger and stronger, it seems like there's a lot of self-selection. We don't encourage people to apply if they haven't had meaningful professional work experience. Some people are in our program with limited work experience, however. Probably some of the people in this group are doing the JD/MBA program, and they tend to be well qualified in all areas except for work experience.

But as I tell candidates who are finishing school and are anxious to start b-school right out of undergrad, they need to focus and set more realistic goals. Because of the collaborative nature of our program, where much of the study and learning is done in teams, the work experience is really important for them to make a contribution. Also the MBA experience will be that much more meaningful for them if they have garnered the experience.

How have these zero work experience folks successfully navigated themselves into the program? Good grades? Extracurriculars?

Again, the numbers are so small. For a class of 260 people, 3% isn't many people (roughly 8). Usually though, they have had significant summer internship experience. Some have cooperative internships or five years worth of experience collaborating with an organization. They aren't just high GMAT takers with high GPAs. They have experience, whether it's through internship or leadership experience, that at least provides them with some base.

Do you allow accepted applicants to defer?

Yes. This year we had about 95 people defer. We allowed everyone that requested it to defer. We found, though, that our number of defers is high but that we don't necesarily see all of them coming back. We'll get maybe a third of them that actually enroll. We're looking at our defer policy and in all likelihood it's going to be tightened up for this next year.

How many applicants were waitlisted?

Just over 100. And 43 people were accepted from the list. We have usually gone to the waitlist and taken some off over the past couple of years. It varies in size and amount admitted each year.

What should the waitlistee do while waiting for a definitive answer of admit or deny?

Just let us know that they continue to be interested. At a point when we decide whether or not to go to the waitlist, we're evaluating criteria, of course, but we're also looking at those applicants that provided us with new stuff that they've done. We're looking for people who made a visit and anyone who showed the extra interest.

Do you encourage rejected applicants to reapply?

If someone wants additional feedback, we will provide them with about a page long written critique of their file. And then if they want to pursue further, they can call us. But the critique usually answers most of their questions -- what was competitive and what was not.

What is this year's tuition total?

For tuition-required fees it's just over $16,000. That's up I think 4% from last year, and it's a flat fee that's guaranteed for both years of the program. So tuition won't rise for the second year.

And the cost of living?

I'd estimate the cost of living to be .. it's very reasonable. The cost of a one-bedroom apartment is probably in the neighborhood of $500 per month. We do real well when we talk about the cost of living, compared with the East coast especially. And there are a lot of nice apartment complexes that MBAs tend to gravitate to. They can be paying under $300 for their share.

Jim, I know that your are on the board of directors of the Consortium for Graduate Study in Management, the group of 11 schools working together to bolster minority enrollment in business school education. How many of this year's students received aid from this organization?

Twenty one of our entering, first-year class. All of our recipients are African-American or Hispanic Americans. And the fellowships cover the full tuition.

Are there any other sources of scholarship available for minorities or women?

Most of our scholarship opportunities are open to any student -- even internationals. There are a few that have been designated by specific criteria depending on the benefactor. Graduate assistantships cover a lot of people. About a third of our students each year get an assistantship that covers partial fee remission. For our 12 hours/week assistantship, the full package is about $9,500 with just over half of that coming off their tuition and the rest in cash stipend.

How many students in the Class of '99 received aid -- loans versus scholarships? Can you quote an average amount?

In terms of merit-based, I don't have that exact figure. But it's probably close to 40% who received something. Among our domestic students, my guess is that probably 60% - 65% borrowed something. We make it really easy here, though, and we try and provide aid through our MBA program. About three years ago we negotiated to pay a portion of the salary for a financial aid counselor (at Indiana Unviersity undergrad). So we now have an assistant director of financial aid who spends 4 1/2 days a week in our MBA office, does all of the processing of MBA packages, and attends meetings. So that's been helpful.

Bloomington is a beautiful area, but it is fairly set apart from any major metropolitan city. The closest -- Indianapolis -- is 45 minutes away. Do you feel that Indiana is rather isolated? Does that affect the school's recruiting efforts? Because I know that some IU MBAs are complaining about the lack of geographically diverse recruiters.

Our placement office has done a lot over the year to not only maintain the companies that are already recruiting here, but also to build on them by focusing a lot of energy on both the East and West coast enterprises. The greatest growth has been in the West, specifically with Silicon Valley firms. The concern about being in a small college town is probably a concern that in reality doesn't have that significant an impact. The reality is that for a company that is interested in our students, flying into Bloomington isn't that different from flying to an airport in a major metropolitan city. They don't come for the location, they come for the student.

Do you feel that the finance department is the predominant factor that draws students to Indiana?

Really it's finance and marketing.

Who are your toughest competitors, in terms of competing for applicants?

Our most significant one is MIchigan; that's the school which we share the most applications with .. and which we probably lose the most to, frankly. With smaller numbers we compete with Texas and Carolina (UNC - Chapel-Hill's Kenan Flagler School.) Just because of our proximity, people applying to other schools in the Midwest will include us in their short list as well.

Would you like to add anything else before we wrap up?

One of things that I've been really pleased with is that we're a program that doesn't stand still. There have continued to be enhancements in the program -- from the academies to our integrated core. We continue to be innovative and try new things. Most of the changes come as a result of feedback from the students, alumni, or recruiters. So we stay current and we listen.

Jim, thanks much for speaking with me today.

No problem. It was my pleasure.