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DECEMBER 14, 2000 B-SCHOOL NEWS Wharton's Invasion of the Bay Area B-School Scene The elite B-school will open an exec MBA campus in Stanford's and UC-Berkeley's backyard
Such a plan may not be as bold as it sounds: This enemy territory, now held by Stanford University and the University of California at Berkeley's Haas School of Business, is ripe for competition. Wharton is the No. 1 B-school in Business Week's biennial ranking, and it boasts 10,000 executive MBA and nondegree students each year. By comparison, Stanford University's prestigious business school (No. 11) doesn't offer an executive MBA and serves about 1,300 people per year in its nondegree executive-education classes. And the University of California at Berkeley's Haas School of Business (No. 18) caters to 2,500 per year in nondegree executive classes. And with nearly 200 full-time professors, Wharton is a goliath compared with Stanford and UC-Berkley, which together have fewer than 150 full-time faculty members. "Size matters," says Wharton Dean Patrick T. Harker. Moreover, while some B-schools, like Harvard and London Business School, have opened small research centers in the Bay Area, none has gone so far as to create an actual campus. LONG WAY FROM PHILLY. Despite the tech sector's recent cooling off, Wharton officials believe there's still a tremendous market for executive education in Silicon Valley. Moreover, they say, the area is loaded with other types of business, and there's a lot to learn from the downturn and the problems of Valley companies. Indeed this issue -- and the valuable research it could produce -- may have led Wharton's faculty to vote unanimously to move forward with the San Francisco campus. Regardless of the tech shakeout, there's money to be made in executive education in the region. San Francisco may seem a long way from Wharton's Philadelphia home, but that's exactly the point. "It's happening here. It's one thing to observe from Philadelphia, and it's another to have a presence here," says Wharton alum and former Hewlett-Packard Co. Chief Executive Lewis E. Platt. He's spearheading the San Francisco facility, which will deliver Wharton's executive MBA program and other nondegree executive-education courses to clients in the Western third of the U.S. The upshot: It could be a boon for the elite B-school to make it more convenient for the region's execs to choose a Wharton MBA now that they won't have to spend long hours flying to and from classes every other weekend. Harker says the offensive move is based on a business plan conceived over the past two years. Besides education, the goal is increased revenue and profit. The San Francisco campus will initially give Wharton's executive program a 20% increase in students. "EXPENSIVE BUT AFFORDABLE." Dropping into the center of West Coast commerce won't be cheap. Startup costs could top an estimated $10 million -- not including rent for a planned 15,000 square feet of space or hotel rooms the school will need for execs who commute from outside the immediate area. "It's expensive, but it's affordable," claims Harker. Indeed, Wharton expects the project to pay for itself, and then some. Platt is helping raise money for the program, largely from Wharton's 7,000 West Coast alums. The $49,000 per year charged to EMBA students -- most of which is paid by the companies they work for -- should also help recoup the costs. Is Wharton's West Coast thrust forcing its competitors to catch up? It depends on whom you ask. Stanford officials say they're not too worried, and although the school's administration has talked about expanding its executive program, Stanford's size and resources don't provide for much growth. The school's officials say they won't use adjunct professors in their executive programs, and expanding would stretch its faculty too thin. While Stanford is hardly unaware of Wharton's looming presence, the elite school will count on its Valley roots and its own reputation to hold its ground. At Berkeley, the administration has already met to plan its strategy, saying they anticipated such moves from East Coast schools. "Regardless of Wharton's initiative...we are investigating launching our own executive MBA," says Jay Stowsky, an associate dean. Timing -- and potential partners -- for such a venture are still up in the air. The school is also considering a satellite campus in Silicon Valley to cater to executives and part-time MBA students there. But, Stowsky says, Berkeley has one advantage: a 57-year history in the Bay Area. And Berkeley's nondegree programs have grown 70% over the last few years. But it's clear that both San Francisco area B-schools are watching Wharton warily. The West Coast battlefield has just gotten more crowded.  By Jennifer Merritt in New York  | | [an error occurred while processing this directive] Learn about your online education options |
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