REAL LIFE ENTREPRENEUR

EDWARD B. SHILS

FOUNDER, WHARTON ENTREPRENEURIAL CENTER

Back in the early 1970s, when many business schools were merely training grounds for corporate technicians, Shils saw that the dynamics of America's economy were decisively shifting from the man-agerial economy of the decades after 1950—the decades of the "Fortune 500"—to an entrepreneurial economy of small and midsized businesses practicing systematic innovation. He saw the shift in large firms from a bureaucratic mode to a more aggressive, opportunistic stance that has become the mark of internal corporate entrepreneurship.

"We got started early, when the whole idea of entrepreneurship was being formulated," Shils explains. "To an entrepreneur, timing and pioneering are everything. We saw that both the students and the business community would not be satisfied with the cookie cutter approach to education. There was just too big an appetite for individualism. The entrepreneurial program had tremendous appeal."

And it still does. The Wharton Entrepreneurial Center's stature within the community is undeniable. One only need review last year's calendar to verify that. Among the many prestigious visitors to the Center were entrepreneurs like Bill McGowan of MCI and Donald Trump of the Trump Organization; corporate giants like Henry Ford II of the Ford Motor Company and Walter B. Wriston of Citicorp; and academicians like Karl Vesper from the University of Washington.

The legend of the founding of the Center goes something like this: Shils saw that many Wharton students were becoming specialized technicians. There were few who adopted a more interdisciplinary approach to management education, one that would show them how to merge all the various elements of their experience into a kind of "managerial gestalt." He also saw a need for business to encourage more innovation and entrepreneurship at every level.

"Too many Fortune 500 firms have become extinct because their bureaucratic formalism prevented them from continuing to create new ideas and new products."

Galvanized by these observations, Shils approached Donald Carroll, then Dean of the Wharton School, for funding to establish an entrepreneurial center. "Too many Fortune 500 firms have become extinct because their bureaucratic formalism prevented them from continuing to create new ideas and new products," Shils argued. "The mission of this school of business should be to create business growth and to encourage innovation, and you don't do that by turning out technicians."

Dean Carroll agreed with Shils' proposal but challenged him to find private sector support for the idea as well. Shils wanted an opening one-year budget of $125,000. If he could come up with the first $25,000. the Dean said, Wharton would match it. Shils took up the gauntlet, and in true entrepreneurial fashion came back with more than was asked for. Thanks to the generosity of two local corporate samaritans Rohm and Haas and the Seltzer Organization, he was able to bring in $40,000 This private money, along with the school's contribution, gave Shils his Center and set the wheels in motion for a new kind of management education at the Wharton School. Funds received from outside companies who shared this entrepreneurial vision exceeded $250,000 during the first year of the Center's operation.

The first entrepreneurial courses dealt with the basics of starting and operating an independent venture. Students flocked to the new curriculum like camels to a fresh watering hole and the program grew exponentially. Today, in addition to the core courses, the Management Department along with the Center offers classes in mergers and acquisitions, venture capital, small business consulting and entrepreneurial decisionmaking.

As part of the Center's objectives, Shils planned to nurture the spirit of entrepreneurship, not only among his students, but in established businesses as well. He set up programs within the Center designed to keep that spirit from being smothered by bureaucracy in big corporations or extinguished by undercapitalization and lack of managerial skills in new businesses.

The Center's relationship with the business community was designed to be a mutually beneficial one. Not only would the community have access to the Center's resources but students would be able to tap into the accumulated wisdom of the business world through internships and visiting lecturers.

Bill Zucker, director of the Kcal Estate Center, an offshoot of the entrepreneurial program, says: "It was the idea of Shils and Dean Carroll to provide, within the school, a window on the real world. It's a way of having our resources made available, and having business people come in and talk with students so that they have an understanding of what the business world is actually like."

Shils' entrepreneurial spirit has kept the Center growing and flourishing for more than a decade. The Center's comprehensive and innovative program has brought it international recognition as a pioneer in the field. A closer look at its offerings will explain why.

The Center is host to a steady stream of foreign visitors who come literally from every corner of the world. Recent guests were from the Netherlands, Sweden, Taiwan, the Philippines, Italy, Columbia, Nigeria and the Ivory Coast. "When many of them first come here," says Shils, "they have only the barest sketch of an idea for an entrepreneurial program. But when they leave, they take home the blueprint of a real working model."

Shils credits the success and growth of the Center under his leadership to a lean but dedicated staff. "Everyone understands that it's more important to get the job done than to worry about whose job it is," says Shils. "The lines of responsibility are loosely drawn and everyone helps each other. Without this kind of group commitment to the goals of the program, we would not be able to achieve such a high level of success. When you have motivated people working for you, you know you're putting out a quality product."

"It really doesn't matter what business you're in; when you get to a certain size, you have to fight like hell not to fall into bureaucratic patterns of behavior.

The individual staff members talk in equally glowing terms of Shils and the Center. "His energy is infectious," says Melinda Schorr, Shils assistant. "Every morning I put on my running shoes just so I can keep up with him!"

"He's really been an inspiration to all of us," comments Bernard Tenenbaum, the assistant director. "It's great to have the opportunity to work with a legend."

Many of the people who work at the Center were attracted by its reputation as one of the oldest and most comprehensive entrepreneurial programs in the world. "We helped open the frontier," enthused one staff member. "Now everyone is rushing to start an entrepreneurial center. Working here, I feel like I'm part of history."

Shils has believed in the blessing of free enterprise since he was a small toddler. He watched his father elevate himself from Russian immigrant to entrepreneur within a few short years after coming to America. "Dad came here at the age of 16, quickly learned English and civics and the trade of cigar making. By the time he was 21, he had his own small handmade cigar-making shop, which ultimately became a national brand."

"America has always been the land of opportunity for those with motivation, drive and perserverance [sic]," Shils adds. "Big business is less than a century old in the U.S. but small business antedates the Union itself. In 1858, Macy was trying to start a successful retail store. Henry Ford was struggling to build his first 'gas buggy' by hand. Today they are part of big business."

So, at the age of 70, is Shils thinking of retiring? Not a chance. Today he is studying law at the University of Pennsylvania and looking forward to passing the bar. "I think the legal profession could be more entrepreneurial," he ventures. "It really doesn't matter what business you're in; when you get to a certain size, you have to fight like hell not to fall into bureaucratic patterns of behavior. A law firm is as prey to this as any other enterprise."

What is Ed Shils' secret of success? Two words: passion and tenacity. He has the passion to pursue his dream and the tenacity to see it through to reality. Combined, these characteristics make Shils an irresistable [sic] force which even the most immovable bastions of bureaucracy have found hard to resist. But then, what else would you expect from a real-life entrepreneur?

Shils with Ted Turner

Shils with Paul Volcker, Chairman of the Federal Reserve Bank