Chemical engineers tend to be smart, but in a linear fashion. Complex organizational challenges usually overwhelm them because they involve people and strategies - neither of which can be reduced to simple metrics. Last time I checked more business majors were leading Fortune 500 companies than chemical engineers...by a factor of 100. In fact, more physicians lead companies than chem engineers by a factor of 12.
Oh...any second rate school like PSU is bound to have second rate students; irrespective of their discipline. My sympathies for being unable to secure a better education for your offspring. As a parent, you really should have done better.