Bloomberg News – Pepsi Ex-Chief Targets Jobs, Duke as Wake Forest Business Dean

By Oliver Staley

Sept. 17 (Bloomberg) — When he led PepsiCo Inc., Steve Reinemund had no shortage of buyers for his products. As the new business dean at Wake Forest University, he knows he'll have to work harder at getting employers to hire his students.

Reinemund, 60, says his task is to improve the job- placement rate for graduate students, which at 73 percent lags behind regional rivals Duke University at 79 percent and the University of North Carolina at Chapel Hill at 80 percent, according to the schools' 2007 data. Since April Reinemund has recruited a career-management director and invited executives of Wal-Mart Stores Inc. and Deere & Co. to strengthen their ties with the school. He has even coached job seekers personally.

While few retired or ousted executives attract offers to be deans and fewer accept the role, Reinemund embraced the challenge of creating a nationally recognized business school at the university, in Winston-Salem, North Carolina. Although experts say improving the program's reputation will take years, helping graduates find employment may provide immediate gains in national rankings.

"Getting a job, in my mind, is absolutely the first essential,'' the slim, intense Reinemund said over a Diet Pepsi during breakfast at a campus cafeteria on Aug. 19. "Our goal is that every single student that comes to Wake Forest will leave with the job of their wish — a job that fits them and their desires for their life.''

Reinemund says he retired from PepsiCo in May 2007 after more than five years as chairman and chief executive officer and six months as executive chairman so he could spend more time with his wife and two teenage children. Familiar with Wake Forest as a guest lecturer, he was lured to the job by university President Nathan Hatch, who served with Reinemund on the U.S. advisory board of the nonprofit Salvation Army.

He says he left the final decision to his family, then living in Dallas.

"We had a meeting and everyone had to vote yes or we weren't going to go,'' he said. "I was able to attend but I wasn't able to talk or vote.''

Pepsi Profit

As CEO of PepsiCo, the beverage and snack-food company based in Purchase, New York, Reinemund more than doubled profit in five years, to $5.64 billion in 2006, topping the 28 percent growth at Atlanta-based Coca-Cola Co., while increasing sales 38 percent. He also engineered the $14.5 billion acquisition, in August 2001, of Gatorade producer Quaker Oats Co.

In April, Reinemund was named dean of the Calloway School of Business and Accountancy, which has an undergraduate program and offers a master's degree in accounting, and the Babcock Graduate School of Management. The former is named after an alumnus and donor, the late Wayne Calloway, who also was a CEO of PepsiCo and introduced Reinemunde to Wake Forest.

Reinemund "chose a school that will benefit from his help,'' said lawyer Vernon Jordan, who serves with Reinemund on the board of New York-based American Express Co., in a telephone interview on Sept. 9.

Fuqua, Kenan-Flagler

One of Reinemund's first tasks will be merging the two business schools so they share faculty and combine functions such as career services, said Wake Forest Provost Jill Tiefenthaler.

"We needed someone who can look at the big picture and think about both schools at the same time,'' Tiefenthaler said in an interview on Aug. 17. "He's going to outline a bold vision for us.''

Reinemund will also try to raise Babcock's ranking from No. 55 among U.S. business schools rated by U.S. News & World Report magazine. Babcock should rank much closer to Duke's Fuqua School of Business in Durham, which is in a three-way tie for No. 14, and the University of North Carolina's Kenan-Flagler Business School, which is No. 19, Tiefenthaler said.

Harvard University in Cambridge, Massachusetts, and Stanford University in California are tied for No. 1.

A Student's View

Reinemund said that while he doesn't have a goal in mind for the Babcock school's ranking, the number "needs to improve.''

His arrival as dean has impressed students frustrated by 39-year-old Babcock's position.

"Let's face it, we're not in the top 10, but we'd like to be,'' said Steven Rutenberg, 28, of Clearwater, Florida, at a barbecue on campus. "I don't know if top 10 is Steve Reinemund's goal, but I think top 20 is.''

The school will have to displace others that are also seeking to improve, said Scott Shrum, the director of MBA- admissions research for Veritas LLC, a test-preparation company in Malibu, California. U.S. News's rankings are hard to move because 40 percent of each rating is based on how well a program is viewed by other deans and by corporate recruiters, he said.

"It is extremely tough and, unfortunately for a school like Babcock, so much of it based on the reputation of a school,'' Shrum said in a phone interview on Sept. 9. "That can take decades to change.''

Naval Academy

A graduate of the U.S. Naval Academy in Annapolis, Maryland, Reinemund spent five years in the Marine Corps before studying business at the University of Virginia at Charlottesville.

He is one of a handful of top managers to step from an executive suite into a dean's office. In a June 2007 survey of 230 business school deans, just 10 came from jobs as corporate president or CEOs compared with 213 who had other academic posts, according to the Association to Advance Collegiate Schools of Business, a trade group based in Tampa, Florida.

Executives usually aren't interested in the slower pace and lower pay of academia, and management schools rarely recruit them because professors prefer to work for people who have been professors themselves, said Gail Naughton, the business dean at San Diego State University and former president of Advanced Tissue Sciences Inc., a now-defunct medical company.

"The dean is appointed by a vote of the faculty,'' Naughton said in an interview on July 9. "If the faculty says we don't want them, it's not going to happen.''

Groff Hiring

To help Babcock's students find jobs, Reinemund is contacting business acquaintances about establishing partnerships with Wake Forest that could lead to internships and permanent positions. He also hired Guy Groff, the former director of career services at the W.P. Carey School of Business at Arizona State University in Tempe, to head Babcock's placement office.

Reinemund said he will involve himself personally in job searches when necessary as he did for Tom Bove, a May graduate who struggled to find work before being hired at Booz Allen Hamilton Inc.'s office in Fairfax, Virginia.

"Here was someone who has been a CEO and was hearing my story and not saying, `You're wasting your time,''' said Bove, 40, in a phone interview on Aug. 22. "He gave me hope.''

To contact the reporter on this story: Oliver Staley in New York at ostaley@bloomberg.net.

Last Updated: September 17, 2008 00:00 EDT