Business Schools

The Wine MBA's First Vintage


Wine-tasting classes for business professionals are a dime a dozen. But getting an MBA in wine? It's happening: On Jan. 14, 11 executives who last September started a 13-month, part-time MBA program on the wine biz embarked on a five-country tour to learn about variations in vineyard management and the habits of wine drinkers. In addition to such tours, guest speakers, and tastings, they're becoming better informed on the economics, finance, international marketing, and other tools necessary to the wine trade.

Most business schools offer degrees in a wide variety of disciplines, including agribusiness, but the Wine MBA appears to be the first of its kind. The Bordeaux Business School in France awards the degree and chooses the students in the program. Four other B-schools combine to deliver about three weeks worth of the course load: the Graduate School of Management at the University of California-Davis, Keio University in Tokyo,

the University of South Australia in Adelaide, and Pontificia Universidad Catolica in Santiago, Chile.

Do wine execs really need an MBA of their own? The B-schools think so. "There are a peculiar set of problems in the wine industry," says Robert Smiley, dean of the UC Davis B-school, who notes that vineyards are among the most vertically integrated companies in the world. Operations typically include the planting and harvesting of raw materials (grapes), plus production of the finished product -- fermentation and bottling -- and, ultimately, the marketing and distribution of wine. "There are a whole set of different business problems as you move from grapes to marketing," he says.

TOP OF THE POPS. Along with the vagaries of nature come a few man-made uncertainties. Take demand: As it blows past the 22 billion liters of wine sold worldwide in 1999, growth is presenting a problem for France, says Isabelle Dartigues, manager of the Wine MBA program at the Bordeaux school. To maintain the quality of France's wine, and to keep the supply and demand for domestic wine in balance, government restrictions limit the amount of wine French vineyards may produce annually.

So to expand, many French wineries have had to plant vines abroad or form joint ventures with foreign companies. At the same time, consumption of other kinds of alcohol is outpacing that of wine, putting pressure on vineyards to maintain their market share.

Until the Wine MBA came along, execs who wanted to hone their skills were more likely to take a course on viticulture (the cultivation of grapes) or enology (the study of wine and wine making) than to worry about business strategy. At some B-schools, students learn more about navigating a wine list than

marketing one. But tens of thousands of wine execs around the world could benefit from knowing more about how to run the business, estimates Richard Vine, professor of enology at Purdue University.

ROTHSCHILD'S BACKING. UC Davis was one of the few schools to take the subject seriously: Execs from Napa Valley could attend the school's part-time MBA program or its annual three-day, nondegree course for about 50 wine executives -- at a price of $3,600 per head.

The Wine MBA isn't for just anyone: People with less than five years of experience in the wine industry needn't apply. "We want to be different from other programs. We want to be top-level," says Dartigues. Current students include the general manager of the Austrian Wine Marketing Board, an executive from a

Lebanese wine producer, and a sales manager at Robert Mondavi Europe.

Next September, the schools hope to more than double their enrollment, to 25. To help recruit that class, the program's patron, Philippine de Rothschild of Bordeaux, is encouraging her contacts abroad to apply. "The baroness' role is giving credibility to our program," says Dartigues. The school shouldn't have trouble attracting recruits, though: About 400 people inquired about the first class after the Bordeaux B-school advertised in Wine & Sprit International magazine.

"A GOOD SYRAH." Participation isn't cheap. Execs who enroll in the second class will pay about 30,000 euros -- $26,505 at current exchange rates -- to cover tuition, room, and board, and will have to pay for their own flights to countries the class visits. That's 2,000 euros more than the

inaugural tuition rate and could help partner B-schools such as UC Davis break even on the program, says Smiley.

In the meantime, Smiley just wants to put his school on the map for its expertise in the business. "Right now, I'd compare [my B-school] to a good Syrah -- or Shiraz in Australia -- a red grape that's becoming popular as consumers discover how good it tastes." If UC Davis can raise its profile with this group,

perhaps its B-school will gain the reputation of, say, Cabernet Sauvignon. By Mica Schneider in New York


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