From Chaebol to Cheese
Wharton Undergraduates Explore Global Business Practices in Milan and Seoul

Learning retail strategy from executives at Calvin Klein and walking the factory floor of Hyundai were two highlights of this year’s Wharton International Program (WIP) trips to Milan and Seoul.

Fashion Is King in Milan
The Italian business site visits included Calvin Klein, Polo Ralph Lauren, Zegna, Neiman Marcus, and Consortium Parmigiano Reggiano. “The Milan trip had more of a retail/fashion marketing focus,” said Wharton Professor Keith Niedermeier, who has traveled with WIP for the past two years.

Students got a behind-the-scenes view of the fashion industry during their visit to Calvin Klein. “The discussion was not only about the company’s financials, but also took us through the research and development processes of their handbag operations,” said Wendy Lue, W’10. “Handbag design is surprisingly not as innovative as I had thought; designers often look to historical styles and current market trends for inspiration.”

“I was intrigued with how design and aesthetics are endemic to the Italian culture,” said Niedermeier. “The design and beauty of the product was engrained in every discussion of branding and segmentation.”

Before the site visit to Parmigiano Reggiano, students attended a lecture on Italian business at Bocconi University. “We learned that 93.9% of Italian businesses have less than 10 employees,” said Dianne He, W’09. “At Parmigiano Reggiano, we saw how a large conglomerate brought together different businesses and streamlined the entire cheese making process, from raising cattle to mixing dairy ingredients. It was very interesting to see so many small companies collaborating in the production process.”

Korean Companies Break with Tradition
In Korea, Wharton undergraduates met with representatives of Samsung Electronics, Hyundai Motors, Hyundai Heavy Industries (shipbuilding), SK Telecom, and Hana Financial Group, including a visit to the Hyundai Factory in North Korea.

At Hana Financial Bank, the fourth largest bank in Korea, students met with the CFO and later discussed business in Korea with one of the company’s vice presidents over a seven-course meal. “I was impressed by the company’s eagerness to embrace western management styles,” says Lauren Fleischer, W’11. “Since [Korea’s] crash in 1997, Korean companies have been looking to phase out chaebol-centric management styles with more western ones.” Until only recently, the rigid, typically family-controlled conglomerates known as chaebols dominated the Korean economy.

During their brief trip to North Korea, students also got a rare look into the most secretive country in the world. “We were given explicit instruction not to interact with soldiers and civilians, and we were told not to point at the propaganda,” said Lee Kramer, director of student life for the Wharton Undergraduate Division, who accompanied the students to Seoul.

For Prateesh Maheshwari, W’10, the visit to North Korea was a highlight of the trip. “It was a once-in-a-lifetime opportunity. Witnessing such a completely different society was very intriguing. It made me really appreciate living in a modern democracy.”

Bringing the Lessons Home
For Niedermeier, who teaches all sections of Marketing 101 to Wharton undergraduates, the trips are a source of new classroom materials.

“This past year I completely revamped my Marketing 101 ‘Distribution’ lecture to include information from the Li and Fung Group that I acquired on the 2007 trip to Hong Kong,” said Niedermeier. “And, when I discuss branding this year, I will undoubtedly refer to how VF International manages its brand portfolio and how Calvin Klein targets its different markets.”

For the students who made the trip, it was a chance to see global business practices at work. “The trip showed me how all of the different disciplines within the Wharton curriculum come together,” said He. “We saw the real-world practice of integrating accounting, statistics, marketing, and finance, into one business strategy.”

WIP also makes Wharton smaller. “Getting to know my fellow Wharton classmates better was one of the best parts of my trip,” said Lue.