MBAs in Space

I went to a screening of the movie Avatar recently. Set 150 years in the future, a corporate firm has ventured light years away (at subluminal speeds), to the distant planet Pandora, where they mine the aptly named 'unobtanium', which sells for (IIRC) $20M per kilogram on Earth.

This MBA candidate had some questions.

1) how did the learn about the unobtanium? How was the research conducted and who owned the original research? These questions lead up to the formation of the firm: was it formed to puruse a known opportunity, or to discover opportunities and then act on them? I can envision a future where observational space exploration is privatized and information is sold off to investors. Imagine, if you will, a ratings agency for extra-solar space exploration. Alpha Centauri could be AAA rated. Epsilon Eridani, not so much.

2) is the corporation the only human agency on Pandora? it seems to me that in real life there would be some small state actors, and possibly competitors. James Cameron always depicts corporations as monolithic entities fueled by greed. He doesn't seem to realize that firms - even monopolistic firms - compete with one another, and typically operate in a regulated environment.

3) The firm behind Pandora's exploration is clearly incorporated; reference is made to answer to shareholders. What is their capital structure? Colonizing a planet that takes several years to get to, let alone return from, is a capital-intensive project that will not generate returns for many years. Real-life examples that come to mind would be telecommunications and power companies. Perhaps warrants, convertibles, and other special instruments were used to fund the company.

4) Clearly the humans have been involved on Pandora for quite some time. They have had time to study the native biology, build schools, teach them English, and (presumably) develop mining operations outside of the scope of the film.

OK, so that last one isn't a question, it's just an observation.

Halfway Point

I am officially halfway through my degree. I don't know my grades yet, but the end of this semester marks 30 credits. Next spring, I start taking electives. I am really looking forward to that.

So, what have I learned to date?

I learned about accounting. I like accounting, it's pretty straightforward. I got a little lost managing my contra-asset and contra-liability accounts (but fell in love with the wording), and how to manage an allowance for bad credit, or for theft, but still, the high level discussions of Enron and and Worldcom shenanigans were very interesting.

I learned about management. I learned how to organize teams, whether hierarchically or vertically, by function or geography, as well as a lattice structure. This was very applicable to my current environment. I work for a ginormous international conglomerate.

I took two strategy classes, back to back; I wish I hadn't, but I really wanted to take Strategy II. Here, I learned of a field I might be particularly interested in. After apocryphal stories of Coke kicking Pepsi out of Venezuela, and learning that Google is not in as strong a spot as it is widely considered to be, I decided to make strategy one of my specializations.

Statistics was nearly the end of me, but I grew tremendously. Firms and Markets was alternately easy and baffling - we had a new prof who would sometimes skip steps.

Operations was more difficult than I expected; Global Economy was easier. Here, again, I found a topic of long-term interest - macroeconomics - to consider as a specializations. Foundations of Finance began as a very interesting class but devolved into a forced march through options pricing.

So now that I've finished up Corporate Finance and Marketing, I have the basic skills of a proto-MBA, right? I at least know the questions to ask, and can follow developments in the news.

Financial Analysis

I have been flooded lately with a new revelation. I cannot pinpoint the source; I can only say that I'm having one of those extended moment where months of education come into a broader epiphany.

After struggling through Foundations of Finance, I seem to be able to dog-paddle through Corporate Finance. Here, am finally applying Betas and CAPM and all that other fun stuff. I learned recently that Google Finance (and others, I am sure) provide Beta values, so now, calculating the valuation of firms is almost fun.

Actually, it is fun, I just don't have time for it as I've got a lot of reading to catch up on.

Another light came on today, when I attended an hourlong CapitalIQ presentation. I actually work for the company that owns it, so I've heard of it and am vaguely aware of what it is used for, but I never had an account. Now, in two weeks, I will. It is frankly amazing, the depth to which the data goes, and I honestly can't wait to use it - again, for fun.

Contrasting Quotes

I came across this for an internal newsletter I send out:

"You can never plan the future by the past." - Edmund Burke.

"The best of prophets of the future is the past." - Lord Byron


Note the distinction between planning and predicting.  It's easy to contrast these quotes, but I'm not sure they're in opposition. I would argue that both can be correct, in that Burke says, you can't define your future goal state in terms of the past state, while Byron is stating the a future state, left untouched by our own hands, will be best defined by the past; that is, if we do nothing, nothing will be changed.

In fact this is my own synthesis, and knowing what I know about these two figures, they probably would disagree. It's a philosophical question that everyone deals with, whether they put it in these terms or not: can we create our own future, or not? Do things stay the same no matter what we do?

Even businesspeople are conflicted. They stereotypical B-school grad says, yes, I can change the world, past performance is not indicator of present or future performance. On the other hand, the more conservative voices use all kinds of mathematical models to take historical data - even recent history - to predict a likely outcome of events. So which is it? A synthesis: here is what I believe will happen, and here is what I will do in order to affect that outcome.

An Exclamation

OK, it was not exactly a "J'accuse" moment, but I did get a reaction when I described this week's Corporate Finance case as a "European colonial" model.

Basically, the company we were studying develops property, then sells off part of the asset while maintaining enough of a stake to require them to manage it. So, they borrow some seed money, build, then get others to buy the risk (giving them back some of their seed money) and they make money running the place. It keeps their risk exposure low as they continue to expand. I thought it was a pretty straightforward case, with some intricate Beta and CAPM calculations.

Some of my friends in that class are European. I think they must have been shocked. Even better, the professor is Dutch (she took it with humor).

The thing is, I didn't mean to imply any negative connotation. I didn't say "A European colonial model wherein the firm gives pox-laden blankets to the locals in order to obtain resources", or "the firm enslaves the local population to strip the land bare of its mineral wealth." You borrow some money, build some ships, build a fort, then sell some other firm a stake in the fort while you continue to run the trading post. There is nothing wrong with that. Easy peasy lemon squeezy.

It does remind me though, I need to keep my trap shut.

Google Intervention - Marketing

A non-MBA friend of mine sends along this article.

As I read it, Google is setting p a third-party online forum that users can access at a moment's notice from their browser toolbars. This is a forum that individual websites have no control over.

I don't know what this means, other than another example of how the internet continues to change the relationship between firms and customers.

http://www.nextdayflyers.com/blog/google-sidewiki-if-you-have-any-web-pages-read-this/

More on Starbucks

After chatting with my Marketing prof at the break yesterday, I brought up Starbucks' marketing of Via. I mentioned my anecdote about being offering Via for free (essentially). OUr topics for the day were segmentation and brand extensions, and it wasn't clear where Via fit in Starbucks' overall strategy.

Our prof generally thought it was a bad idea. He said that while Starbucks has had success in selling its coffee beans and branded ice cream in grocery stores, Via was different because they were also trying to sell it in their own stars. Here you have a coffee brand that appeals to people who will 1) stand in line and 2) pay a hefty premium over deli coffee. Does Starbucks expect these people to stand in line in order to pay a premium for an instant version of coffee they can already acquire in other ways?

From my own life, I can say that if I want Starbucks coffee, I can either 1) stop in a Starbucks while I am out or 2) make coffee in my french press using beans I buy from Starbucks. The only time 'instant' single-serving enters the equation is if I am not going out and don't want to make more than one cup. This is an extremely rare situation.

That being said, I want Starbucks to succeed. Despite all the criticism leveled at them as they have become an international uber-chain, I still like the company, their products, and the fond memories of Seattle that they bring to mind.

Starbucks Promotion

A couple of weeks ago Starbucks rolled out their new line of instant coffee. I tried it; it's not bad; I even bought some, though I haven't used it yet. What grabs my attention, though, is how hard they've been pushing it.

The quality of Starbucks' coffee is a topic of high debate for some. I am one who likes their coffee. Every morning I get a tall cup of their over-the-counter coffee, with flavored syrup. The syrup is free because I have their rewards card.

This week, I have left my rewards card at home, lost it, whatever, so I've been paying a little more than two bucks for my drink. Two for two this week, Starbucks has offered to 1) give me free syrup and 2) throw in a three-pack of their instant coffee for $1.95 - less than the nominal value of what I'm buying in the first place.

That's right: they are offering their instant coffee for free and charging me less.

Yesterday It took the deal. Today I didn't. I already don't know when I'll drink the instant coffee that I do have. When I'm traveling, maybe?

In any case, it's something to bring up in marketing. How low will you go to promote your products? What's Starbucks' game here - to goose the numbers, to move product, to encourage people to try it?Hard to tell.

The Current Classload

So, we are officially three weeks in to the Fall 2009 semester, one quarter of the way through. I ought to comment on my current classes, Corporate Finance and Marketing.

Now that we've learned how the sausage is made (in Foundations of Finance) it's time to apply that to corporate planning. So far, we've learned how to model discounted cash flows for use in determining net present values, and to use NPV to make go/no-go decisions on projects. I find this very interesting, as I work in IT and I've worked on many projects from the ground level; now I am learning how they are valued and decided. Next up is risk assessment, which centers on gauging the beta value of a project, line of business, or segment.

Marketing is similarly proving to be much more interesting than I anticipated. It's a Saturday morning class, which I don't mind at all; it's an excuse to stop by my favorite bagelry (Murray's on 6th, just below 14th st). Marketing is so closely tied to strategy, I'm considering it as a specialization. All this time, I thought marketing came afterwards, but it seems that the intelligence gathering and product testing elements can actually help drive strategy.

Valuation

So in Corporate Finance, we're talking about valuation - how to value a company or a capital project. I work in IT, so it's interesting to see how the financial end of the decision-making process is managed. So many technology projects are rolled out with no concern as to the initial or ongoing expenses, and no regard as to what processes they are replacing, it's wasteful. 

Our case for last night's class had some interesting nuances to it. It revolved around a pharmaceutical company considering an opportunity to license an unapproved drug from another company. The pharmaceutical company would pay the costs to test and shepherd the drug through the FDA approval process. What was interesting to me was how to factor in the chances of successfully getting through each trial, along with the potential for the drug to have more than one benefit. 

Once the options were laid out in a decision tree, it was just like game theory: start at the end, and work backwards to see which branches were profitable. As it turned out, they all were, though some were more profitable than others.

My own company is engaged in the same process, but in reverse. We are divesting one of our flagship business units. How do you place a value on that? According to class, we'd have to look at the net present value of the company, which, based on their business model to date, would be diminishing (this is my speculation, and not a representation of my company's position, or based on any information not already public). What are the employees worth - thinking back to Strategy II, is this business unit an EVP or AVP proposition? From where I sit, they're on the cusp, and that makes the valuation all the more awkward.

JDs, MBAs, and JD/MBAs

I found a little bit more on the previous subject of JD/MBAs. It seems that generally, an MBA is seen as an enhancement to a JD, but that a JD adds less to an MBA.

JD/MBAs are often seen as neither fish nor fowl within either professional track. Law firms worry that they'll jump to more lucrative non-legal job opportunities, and businesses don't know what to do with the JD half of the degree. The exception seems to be specialized fields such as investment banking, or related M&A work, where the combination of legal diligence and business analysis becomes more important.

http://writ.lp.findlaw.com/hilden/20080414.html

My Fantasy Alternate Reality

Lately I've been perusing the possible specializations I might obtain with my degree: Strategy, Economics, Operations, Law & Business. This last is particularly interesting to me right now.

It's difficult to explain why I'm interested in law and business. Maybe it's because regulation and politics - both firmly rooted in the law - are kind of hot right now. Maybe it's because I tend to be far more qualitative than quantitative. Maybe I just like making arguments. 

I spent three years simply being interested in the law, not counting post-college mental perambulations. Five years ago I was reading about law, talking to lawyers and almost-lawyers. I read www.nylawyer.com every day over my morning coffee. I toured Fordham and Brooklyn law schools. I paid off all of my consumer debt, then studied for over a year and took the LSAT.

I bombed. Still, the allure of law persists.

It's tedious and detailed. I work in IT, which is already tedious and detailed. There are kinds of rules, regulations, the mechanics of our society. Come to think of it, I was first enamored over ten years ago, when I worked at a dot.com startup and the telecommunications industry started to deregulate. What does it all mean? How does this work? Instead I moved to NYC to work in media, and ended up in IT instead.

When I first set out for an MBA, I was going to go to Baruch. They have a JD/MBA program with Fordham and Brooklyn. Granted, these are not toppity-top ranked schools but they are well-regarded in the city. As it stands now, getting my MBA at NYU significantly impacts the kind of opportunity cost I'm willing to take on for a second professional degree.

But still, I dream of law school. Reading up on contract law, torts, interstate commerce clause. It all sounds so fascinating, at least until there's a test on it.

Maybe I'd be better positioned now as a full adult in school, not a young'un trying to be cool and high-achieving and encountering setbacks for the first time. I have much more fortitude than I did in my twenties.

More than anything else I like to know what I'm talking about, and these days, I'm more interested in talking about government and business than, say, the annual politics of a film festival, or the latest album by some arty Canadian band.

Law school, we never had ye, but ye be missed.

Recession, Worker Pay, Health Costs

Slate's "Slatest" has two oddly juxtaposed items today.

First of all, a recent poll indicates that many employers expect to shift the cost of health care more to their employees, noting that costs are increasing rapidly; an estimated 166% in the next ten years to an average of $30,000 per employee.

Second, people are getting raises - and it's not just financial seers. Apparently, for those who managed to keep their jobs, not much has changed, pay-wise, beyond the ongoing fear, uncertainty, and doubt permeating the economy in general.

Unrelated: Lego, Boeing

Two articles in the NYT caught my eye today. Oddly both mention business news about two companies I liked when I was a kid.

I loved Legos, and spent all kinds of time building moon bases, spaceships, houses, submarines, and much more. I would be one of those adults slightly disappointed that all Legos seem to be based on licensed settings now. That said, it seems to be a strategy that works.

I built spaceships because I was into aerospace, and my granddad would take me out to the airport to look at planes; we greeted the Concord when it came to Tulsa. Boeing was one of those Big American Companies I saw mentioned all the time, and it's been interesting to read about them in some of my classes - in particular, my microeconomics class featured a case about the Airbus SuperJumbo vs the Boeing Dreamliner.

I have to admit I was partial to the Dreamliner, partly because so much of the case history told the story of what Airbus was doing wrong and Boeing was doing right. Either way, they both pursued different markets. The case history stopped around 2005, when Airbus was first encountering production delays - and now, apparently, Boeing is as well, in large part due to their outsourcing model.

(Tangent - this is the kind of problem outsourcing always brings about. I don't believe outsourcing is particularly good or bad, but it certainly requires more orchestration on the part of the outsourcer, something most are not prepared for. In my current position, it's clear that we can't just turn over functions to our outsource partners, though I doubt that, as Boeing has, we'll end up buying one of those partners).

http://www.nytimes.com/2009/09/06/business/global/06lego.html

http://www.nytimes.com/2009/09/06/business/06boeing.html

An MBA Candidate Looks at Health Care

While the health care debate in the US ebbs a bit, I've been finishing up Amity Shlaes' The Forgotten Man, an account of the Depression that goes into the contemporary politics of the time. I understand it's considered at least slightly revisionist, critical of missteps by the Roosevelt administration, as well as a bit more forgiving of the Coolidge and Hoover administrations, though in my opinion she doesn't outright condemn or condone either. In any case, what I find most intriguing is how much the debate over power utilities during the Depression matches the debate over health care in the current period.

The most similar argument is that a government option will put private providers out of business, or at least make the fields so unprofitable as to be not worth pursuing. Roosevelt built the Tennessee Valley Authority and similar public power works; Obama's much-debated and ill-defined public option arguably will provide the same.

I don't believe I know enough about either arrangement to make a cogent argument for or against. What I do believe, however, is that while the free market may be the most efficient provider of services, this is not always true, and there are certainly gaps that the market does not address. In the case of electrical power (and telecommunications, I might add), the market does not have the incentive to develop service in areas that are not profitable, such as rural homes and smaller municipalities. Similarly, the market has no incentive to provide health care coverage to those who are unemployed, underemployed, self-employed (except at a steep premium than corporate policies) or simply not profitable such as consumers whose premiums no longer cover the cost of care.

Creating an incentive mechanism to cover these gaps is just one of the many problems in health care reform. The more I learn about health care as an industry, the more clearly I can see why health care reform is and always has been so difficult.

There's the method in which doctors are paid. There is the complex relationship between government and hospitals, as well as the distinction between public and private service. There's preventive medicine, catastrophic care, end of life and long-term disability, pharmaceuticals, advanced imaging, prosthetics, and research.

Oh, and we still can't cure the common cold, Airborne notwithstanding.

Add politics to the financial complexity of health care, and you'll get an entanglement of cables, doused in molasses, encased in ice.

Ask most Americans about health care reform, and they'll agree it is needed. Where to start? If they have any idea at all, it usually comes from personal experience. If someone tries to stand up and offer a specific idea, all their opponents need to do is convinced the uninformed that that person is wrong.

It's frustrating to watch.

An Economist on an Economist's Prediction

I recently saw a Bloomberg article that I thought contradicted the general consensus of just a few months ago, so I asked one of my Economics profs about it. Here is his response:

"What [corporate economic advisor] says is not that much different from [another corporate economic advisor's] view. [Previous Guy] had suggested about 4% growth in the next four to six quarters- and that is pretty robust indeed. I can understand the arguments for that and I think it is plausible. [Opposing View's] view of 2% growth in the coming years is propaganda for [Company's] position- not a serious view."

Weeks Later . . .

Another term has flown by. I did alright in my Foundations of Finance class; not spectacular, but alright. I really busted my butt for the final, and even before then was going in for extra help. That's got to be the biggest difference in being an adult getting an education; I am a much less passive learner than I was in undergrad.

Right now I am on hiatus. While many of my classmates took one class, then another, and are now in summer intensives, I took two classes, then Finance, and no intensives. It is awesome to have a life back. I practically don't know what to do with my time. I've been easing back into my summer activities: riding my bike and kayaking, plus staying up late and sometimes even going out at night.

I've had time to think about what I want to do with my MBA; now I must think of it as this MBA, an MBA from a finance-heavy school in the town that plays home court to Wall Street. I find the financial M&A world interesting but I don't have the quantitative chops to be competitive; I do like strategy and management, and I'm very analytical, so I think perhaps I could go into a different part of the M&A world, or straight into Management Consulting. Strangely, consulting does not hold the appeal that it did when I started. I don't know if that's age, or the realization that I've more or less acted like a consultant in my career to date, and I get a little frustrated when clients don't take my advice.

My company is going through a re-org, and that includes my department. There may be internal opportunities to pursue. I'm polishing up the resume and dressing a bit more like an adult. Forty percent way through my degree should count for something.

Final

Last night I took my last final for Summer I. The course was "Competitive Advantage from Operations" or Comp Ops for short. It was taught by the department head, a wiry Dutchman who's been teaching for thirty years.

It was a very interesting class, once I'd been looking forward to for quite a while. It was a bit more quantitative than I had expected, though fortunately since my near-death experience in Statistics, I seem to have ingrained some of the fundamentals of how to utilize the normal curve. Where I got lost at times was in parsing the problem, that is, how to express it in math.

The final was hard, but not inordinately so. It was, as the CFEs describes, "appropriately demanding of my time". We were given two and a half hours, and I clocked out at two hours twenty-five minutes. I later learned he let people run long, since most of the class was still on the case when I left. This morning, there was an email about extending partial credit more generously on the last problem; apparently a lot of people had difficulty with it.

All of that being said, I found the class very informative and useful in my present position. Reviewing my study notes, it's clear we covered a lot of very distinct topics: queing, supply chain management, project management, resource management, quality control, and using statistical models for decision making. It's the kind of thing that I used to make fun of in my youth - that period when we rebel against ourselves in order to prevent mono-dimensional personalities. I have to say, if (for example) you're shipping boatloads of cars overseas to market, you'd better have an accurate way to predict demand and resource your warehousing appropriately.

So, with that, Summer I is done. Summer II begins tonight! This time I am taking only one course - Foundations of Finance. I'm sure it will be a more demanding course, but the simple fact that I'm not getting home at 10 four nights a week will be greatly appreciated.

Xbox

I recently bought an Xbox, and I've come to a realization: the Xbox is Microsoft's iPod.

It's not a totally accurate comparison - the Xbox unit has yet to be profitable, while the iPod has been enormously profitable - but in terms of strategy, it occupies a similar space. Microsoft has spent a lot of money creating not just a product but a platform on which additional goods and services can be built.

The Xbox is not just a game machine, but a DVD player and network media center. It's what WebTV was supposed to be and so much more. WebTV was ahead of its time; now that broadband is commonplace and third-party suppliers of media content such as Netflix exist, Microsoft can concentrate on developing a platform with hooks into other services. Add to that the lowering cost of HD televisions, and you have a device where the game play is almost an ancillary function. At half the price, I could almost buy an Xbox for everything but the gaming functions.

That being said, the Xbox is an example of a strategy I learned about in business school. A firm may spend a lot of money just to enter and exist in a market space, even if the business is not profitable. The reasoning is that the market will eventually be profitable, and it is easier to enter the market when is still being developed rather than later. Instead of letting two (or three, depending on how far back you go) other firms lock up the market - say, Sony and Nintendo - enter the market, develop your internal operations to support additional goods and services, and eventually you'll take enough market to make it all worthwhile.

I do not know for certain, but I have read that the Xbox would be profitable if Microsoft hadn't taken a $1BN charge to facilitate repairs of units that fail due to a bad manufacturing process.

In any case, the Xbox is an interesting product to watch. Compare to the Sony Playstation 3, which is similar in aspiration and scope, but a year or so behind in development (which makes sense -it came out a year after the Xbox360). Sony is still trying to develop the backend connectivity and business relationships. Watch the business, not the device.

It will be interesting to see how these firms evolve their products to fit the market.

Shopping and the Market

The NYT has a piece today about changing strategies for retailers. A number of strategies are being attempted. Having recently engaged in various forms of shopping myself, I compared my experiences to the retail reality.

For one thing, supply chain management is huge. I have recently come into the market for a television, and after tons of research, settled on a particular model. While I normally shop online, I decided to check the local stores and kick the tires, so to speak, finding my model on the floor. Three times now, in the past two weeks, I have been thwarted in my attempts: the model is out of stock, and there are no guarantees as to when new stock will arrive. In fact, even when I use the retailer's online store to find where they stock the model, I have found them to be sold out by the time I get to the store.

This is one of two points in the NYT article. For one thing, retailers are beginning to combine their online shopping with in-store shopping, through shopping kiosks where customers can essentially order online within the store for in-store pickup. For another thing, consumers are buying within shorter, less predicatble time horizons, and so stores are not stocking as much inventory ahead of time. The result sems to be - in my case at least - that items in production are still hard to come by, unless I commit by ordering online, which is what I tend to do anyway for small items. It's one thing to order an external hard drive through the mail, quite another to order a television.

Apt

It's worth mentioning that I am actually wearing pinstripes and denim today - the name of this blog. Pinstripe pants from H&M and a denim jacket from the Gap.

Frustration

I was chatting with a co-worker earlier today, and together we hit on what we're finding frustrating in our organization.

"It's as if we're more concerned with limiting our liability rather than providing a service," one of us said.

It's an old split in the IT world, a split that reflects the industrial origins of whoever is promoting the position.

Businesses rely on technology to automate processes and provide a competitive advantage. Things have to work, or the business won't make money.

On the one hand, any sane service provider (which is what IT is) is going to be very careful about setting expectations. On the other hand, If you don't provide services, you aren't (arguably) creating value.

The split can also be described as the difference between being a plumber vs. being an architect, or a technician vs. an engineer.

So, which is it? It depends on whether or not you're trying to grow your domain. Or rather, how you're growing your domain. In our case, there are some responsibilities we've inherited, which we do not need to compete for. There are other responsibilities which we are pushed to take on, but are reluctant to, because the scope is not fully defined.

The result is that we spend a lot of time talking about the things we can do for internal business units, but when they have a specific request, we backpedal. Or, worse, we commit, then find out that a process we were relying on is not supported for our needs, and we fail.

The end result, which is bad for the company at large, is that no one wants to approach us for help, because we either say now, or we fail. So, no one changes how they do things. No one reports problems, nothing gets fixed, and we hobble along; we muddle through and get by.

Summer Breeze

I'm taking two courses in Summer I, Competitive Advantage from Operations and Global Economy. My classmates think I'm crazy for taking two courses at once - this amounts to four nights a week. However, the course load seems manageable, and so far, I really like the material.

There are all sorts of crazy stats I've learned. Six million Americans work in call centers. Open heart surgery is conducted as an assembly line operation. Customer satisfaction for fast food and investment brokerages are about the same. The post office, of all things, rates among the highest customer service experiences, though not quite as high as expedited delivery services.

On overindulgence

I came across the following article on Slate's The Big Money site. It's a very fascinating overview of how not to run your resource-rich country. Hint #1: don't have a one-note economy.

Hell in the Pacific 

Disappointment & Collusion

My midterms are awful; the only shining line - dare I say, a sun that illuminates at the risk of burning my flesh - is that my midterm scores only apply if they help my final exam grades. Let's just say that this is an unlikely event in both of this term's courses.

What's the problem? I'm not a quant. I can follow the theories and takeaways, but the underlying arithmetic is a hedgerow maze of mathematical transformations. I understand the fundamentals of supply/demand curves and statistical analysis, I just seem to get the basic math wrong. I've spoken with both professors and obtained guidance on my weak spots, but still, it's hard not to feel a little daunted. 

One thing though - one prof makes continuous references to the "Stern curve", as if to chuckle and say, hey it doesn't matter, you're all going to be fine in this program. He's made comments to the effect of us being yuppies. Yuppies? Generous curve? Success no matter our interim failures? I find that hard to believe, or at least hard to take heart in. 

All things considered, I am paying more attention now, not only in class (I was paying attention before! I swear!) but in devoting an entire day on each weekend to study. I want to do well, even in my weak areas.

Spring Eternal

What's an MBA Candidate supposed to write about? Certainly not existential questions such as that. It's been quite a while since I posted here. Spring midterms are next week; Winter intensives seem to be forever ago.

So, math is hard. I am enjoying my courses conceptually, but the math itself is hard. Perhaps not hard, but detailed. Initially I found statistics to be more difficult, if only because it is more rigorous, but both classes are demanding. When your professor says "There are two ways to do this, one for those who like calculus and one for those who did not" . . .well, maybe that's a sign that I should have just taken the LSAT again instead of the GMAT.

In the meantime, real world lessons learned: one cannot hang up the phone in impatience, and when a business manager talks shit about one's service offering, one shan't sass back.

The Spring of Things

I'm back in class. This semester, Statistics, and Firms & Markets, which I am told is macroeconomics.

The Winter Intensives were aptly named. I don't know that I could run on that schedule year-round, not effectively anyway. Also, while I am glad that I took Strategy I and Strategy II together, I see the wisdom of spacing them apart. I will probably forget most of what I learned by this time next year.

It is nice to have the weather warming, even if just for a little while. marching downtown through the ice and the wind was not conducive to learning.

Winter of Discontent

So, it's been a long winter.

I got Bs in my first classes; one was a B+ and one was a B-. Now I'm in Winter Intensive Strategy classes. I love them, maybe because they're all about concept and there's no real responsibility. I'm not sure I'd love strategy so much if I had a stake in whether or not my strategy would work.

Our instructors for Strategy I and Strategy II are very different from each other. Our Strat II prof is very real and blunt about the motivations and goals of firms. It's nothing I disagree with; I've always thought firms were about making money, and ultimately, innovating ways to make money. Certainly, the firms we've studied have been very innovative (DeBeers, Pepsi, Google).

It is a dismal time to be eying the corporate world though. Millions of Americans have lost their jobs, and firms can't get capital to float their projects. Now the debate is turning to the mass bonuses certain financiers received; hand-in-hand with that is the observation that Bank of America overpaid for Merril Lynch because the top talent left the firm with their bonuses.

So that was interesting. 

This week we finish up Strategy II, and next week start regular Spring term classes: Firms and Markets, and Statistics.