Successful people are simply those with successful habits. – Brian Tracy
I’m not going to Harvard Business School (HBS)
to write a book about what I’ve been through.
Actually, after ten years as a journalist,
I came here to get rid of my writing career,
so that I can no longer dig up real life stories
and put them on the pages of newspapers.
I want to learn about business
to master my financial destiny
and more importantly,
to master my time.
I was tired of having to carry my cell phone
or being bullied by my boss all day.
I hope my master of business administration (MBA)
will help me understand more about the workings of the world
and make more choices in my life.
In fact, I did not write this book to “show people’s backs”.
In many ways, I loved my two years at Harvard.
My classmates are very polite and considerate.
Most faculty members in the department are dedicated
to instilling a passion for the subject in their students.
Facilities and people are very good.
There is no better place to observe capitalism than here.
For me and for everyone I know,
Harvard has changed the way we see the future
and opportunity through business.
But it was also a much more stressful time than I thought.
The amount of lessons was heavy,
especially in the first weeks,
when we had to wrestle
with specialized areas of business such as finance,
marketing and organizational behavior.
A few months later,
the pressure of finding a job, a “proper” job,
was an educational process on its own,
far beyond what happened in the classroom.
This book is an attempt to describe my
and my classmates’ experience in this cradle of capitalism.
After re-reading the diaries of my two years at Harvard,
I was amazed at the emotions that arose from
what I had been through.
I had assumed that my time in business school
would be a carefree period of studying
and preparing for a career change.
But we talked a lot about our aspirations
and future life for ourselves and our family.
That is evident in this book,
in addition to what we learn,
what famous speakers speak
and the decisions we make about our work.
The opportunity to study at HBS is a precious gift.
In 1960, only 5,000 people graduated
with MBAs from American schools.
By 2000, this number had grown to hundreds of thousands.
Today, there are all kinds of MBA courses:
typical two-year full-time on-campus courses or part-time,
online, evening or distance courses.
The number of people applying for an MBA in the Middle East,
China and India is skyrocketing.
People with an MBA tend to have higher salaries and better jobs.
This precious three-letter MBA becomes the “entry” ticket,
in some cases a prerequisite,
to business success.
I studied at HBS from 2004 to 2006.
Up to that point,
among its alumni include the President of the United States,
the Secretary of the Treasury of the United States,
the President of the World Bank,
the Mayor of New York,
not to mention CEOs of large corporations such as General Electric,
Goldman Sachs and Procter & Gamble (P&G).
According to the Fortune 500 list,
HBS alumni account for 20% of those holding the highest positions in the company.
The hedge funds are also full of Harvard MBAs.
Every time they return to school,
they are welcomed like kings.
HBS believes that the qualities required
to succeed in business are also necessary
for all other industries such as politics,
education, health and the arts.
I’m not from the business world,
and I’m instinctively opposed
to the idea that entrepreneurs can run everything.
This view has emerged continuously over the past two years and explains
why a book about an MBA at Harvard is of interest
to a wide range of readers,
not just those who already have or want an MBA.
and leadership styles taught in an MBA affect us all.
Business schools don’t just produce leaders in business.
MBA courses also determine the way we live,
the hours we work, the vacations, our cultural background,
the medical care we receive
and the education of our children.
the Master of Business Administration has made important historical
and global decisions.
In short, the MBA degree,
its content and the network of its holders are very important.
And it has ambitions to become even more important.
This book represents my personal opinion.
No single MBA can represent HBS’s 900 students
for the 2006 academic year.
Everything in this book is exactly as I describe it.
But I have changed some of the character names
and related details for two reasons:
the first is for privacy.
HBS classrooms are a safe learning environment,
a place of trial and error.
My classmates didn’t know I was going to write about
what we went through.
The second reason is that the change allows me
to honestly describe
what I’ve been through without worrying about the reputations of those
I love and admire.
The professors, because their teacher status is public,
as are the speakers who have come to speak,
will appear exactly as in reality.
I intend to combine these approaches
to provide a true picture of my time at HBS.
When our course ended in June 2006,
we received an open letter from Principal Jay Light.
“As you join the ranks of HBS alumni around the world,
I hope you continue to stay in touch with the school,
sharing your thoughts and views on your years there,” he wrote.
Here are my thoughts and views.
The key to success is
to focus our conscious mind on things we desire not things we fear. – Brian Tracy
Chapter 1. LIFE SLOWLY
Don’t we all feel like we’re leaping
to the end of the world at times?― Mick Jagger
“I would like to introduce myself, I’m Philip.”
The HBS principal and 90 classmates stared at me.
At that time,
I was holding a crushed chicken salad sandwich in my hand.
We had been studying for a few weeks,
and at lunch, our principal,
Kim Clark, came to our class, introduced himself,
and asked questions.
He was a devout Mormon, thin,
almost 60 years old, talkative.
“When I was a young professor,
when I first walked into this class to teach,
a guy named Jack sat there.
Now, he’s Jack Brennan,
chairman of investment management group Vanguard.
And sitting over there is Jeff,
a former Dartmouth football player. Currently,
Jeff is the CEO of General Electric.
Over there is Donna’s place,
now Donna Dubinsky is the CEO of Palm.”
Excitement spread throughout the class.
You can feel the whisper of ambition.
Ninety students sat in five rows of horseshoes facing the blackboard,
all thinking: will I be mentioned in 25 years?
The future 2031 dean will say to the class:
“Susan used to sit here.
She used to be afraid to speak in class,
but now runs the world’s largest hedge fund.
Tom over there became the CEO of Google.
And Philip. Rub! You have tens of billions of dollars?”
We looked at each other, wondering.
I first set foot in HBS on a sultry evening in August 2004.
Margret, my wife,
and one-year-old son Augie stayed in New York
to wait for our belongings to be sent to us from France,
where we had lived for two years and a half.
I don’t know anyone at school.
For the first time in 10 years,
I have no boss, no work, and no salary.
About two hundred students,
who knew almost nothing about business,
were called in earlier to study the Foundation Program,
in order to keep up with the 700 other students
who would arrive here in three weeks.
These seven hundred students have mastered the basics of using a laptop,
understanding financial models,
and proficiently using PowerPoint.
On the other hand, in the first year,
we will have to go through an intense study program
which is the Compulsory Program.
Therefore, we were acquainted
with the teaching method based on examples (real situations)
of HBS so that we would not be surprised
when entering the school.
After I signed up,
I was given a briefcase containing examples
for the first week
and would have to meet for 15 minutes
with my team in the meeting room at Spangler Building,
a large George-style building in the center of the university.
I excitedly left the room,
sat down on a chair near the tennis court,
pulled out the first of hundreds of case files to study,
and began reading.
The whole curriculum of HBS is the study of typical cases,
real business cases.
The question that you must answer in each situation is:
What would you do in that situation?
There is no right/wrong answer.
In many situations,
the actions of key players turn out to be disastrous.
The only thing that matters is what you think about it,
how you deal with the lack of information and the unrest.
The hope is that after calculating
or valuing the bond,
you will have a way of thinking
and making an informed decision.
Faculty members have created these scenarios,
which range from a few pages
to more than 30 pages.
They typically include an impressive case narrative,
a business analysis to discuss,
and the tables,
and documents needed to illustrate the problem.
My first scenario was as follows:
“Once upon a time,
there was a lord named Baron Coburg
who lived in a castle on the top of a hill in a small province
in Western Europe.
He managed the peasants
who dwelt on the land around the castle.”
The baron ordered two farmers,
Ivan and Frederick,
to plant crops on two different plots of land.
He gave them seeds, fertilizer, and cows,
but told them to hire a plow from the old Feyador plow.
A year later,
they brought in varying amounts of wheat, two oxen,
and two worn-out plows.
“After they left, the Baron began
to think about what had happened.
“They did very well,
but who did better?” he thought.
This is a calculation scenario,
and our task is to answer the Baron’s question by preparing income statements
and balance sheets for two farms.
Why did a Medieval Baron,
given the choice between looting,
raping and accounting,
That confused me.
But this is an HBS school,
so the Medieval Baron was also very different.
On the tennis court in front,
two students had just started warming up.
One wears a blue bandanna,
the other wears a t-shirt.
At first, they hit lightly,
each a few meters from the net.
I stopped reading to watch them hit the ball,
captivated by the rhythmic beat.
Gradually, they hit harder,
arms darting through the air
and the ball falling closer and closer to the touchline.
Perfect smashes, always aiming
for the ball wandering in atmosphere.
In the rectangular yard,
everything is very precise.
I stuffed the note into my bag and headed to Spangler to meet my group.
Seated around a large blue table were two veterans,
a former employee of the New York City Mayor’s Office,
a Taiwanese management consultant,
and a very confused blond woman
who just recently left the Boston hedge fund management company.
The two veterans seemed too big for the room,
their biceps protruding from their tight T-shirts,
while the blonde looked scared and small.
Justin, the New Yorker,
turns out to be living a few blocks from my house.
Apparently we were all assigned to the Baron case study
and they all knew exactly what to do.
They open their laptops
and get ready to do their homework.
Before going to Harvard,
I only knew how to use Win Word.
I have never used Excel or PowerPoint.
For the first few days,
I decided to stick to the familiar pen
and paper and focus on what other people were saying,
rather than trying to master new software.
After all, even J. P. Morgan doesn’t know Excel,
which runs much of the American economy.
I looked back at the Baron’s problem.
The matter seemed uncomplicated:
a few bushels of rice here,
a few bushels there, fertilizer,
cows, worn-out plows and an exploiting feudal landlord.
“Ivan,” after a moment, I volunteered to answer.
Everyone looked up.
“Ivan does better.”
I quickly explained my calculation.
“You forgot to calculate the depreciation of the cows,” said ex-Marine Jake.
I recalculated. “Frederick,” I said a moment later.
“Have you added the full value of Ivan’s plow
to the ‘cost of goods sold’ field?”
Jake asked again.
This time I decided to keep quiet
My entire knowledge of accounting is only the documents assigned
to read during the summer,
and they are less than what I had hoped for.
“Is this baron a shareholder or a lender?”
Fresh out of the vanguard of fighting in the terror-stricken Baghdad,
Jon seemed the least worried of the bunch.
“Has anyone calculated the wear and tear of barren soil due to fertilizing?”
For the next hour or so,
I scribbled while the numbers buzzed in my head.
“10 kilograms of fertilizer is worth two bushels of wheat,
one cow is worth 40 bushels.
Ivan still owes Feyador the plow…”.
The numbers kept floating around in my head.
First, Ivan was a better farmer,
producing two-thirds more rice per acre than Frederick.
Then Frederick again exceeded 5/6 bushels.
“I worked out some coefficients,” said the blonde.
“Net revenue on assets shows Frederick doing better.”
The others nodded.
But farmers don’t sell anything, I thought.
They just gave all the wheat to the landlord.
So perhaps feudal tribute on property is the better ratio.
This has no benefit at all.
Next comes “The Case of Unidentified American Industries”.
This is our first entry into the financial sector.
Before entering HBS,
I was very afraid of finance.
I was eager to learn but was afraid
that I would fall behind the class.
That first night didn’t give me any confidence.
We were given a list of 12 industries,
from a basic chemical company
and a supermarket chain to a major airline
and commercial bank,
an anonymous ledger of percentages
Our mission is to precisely match industries
to those anonymous balance sheets.
I knew the true meaning of the coefficients
from reading the literature over the summer.
You compare the numbers in the financial statements
to see the quality of a business.
For example inventory.
Companies that hold inventory often try to strike a balance
between storage costs
and the need to keep enough inventory to sell.
This is similar to wanting to have enough food
for the whole family
but not wanting to have so much
that the refrigerator is full and the food goes stale.
On the contrary, you want to buy a large stock to get a discount
instead of having to buy expensive every day at the corner store.
Or are you a foodie
and like to buy fresh food every day?
The problem is that each family has a different way
of controlling food reserves.
To analyze inventory management in a financial statement,
you must start with the “cost of goods sold” and “inventory” numbers.
“Cost of goods sold” (COGS) is the value of goods sold
by a manufacturer over a certain period of time.
And “inventory” is the value of goods that manufacturers are waiting to sell.
Divide COGS by inventory
and you’ll get the company’s turnover rate.
This ratio is equal to 1 which means that the company has enough stock
to sell during the settlement period.
In the fresh food market,
with a one-year balance sheet,
this would be huge because stock is replenished daily.
But in the high-end gem market,
the ratio is lower than 1 because each product has
to wait a long time for a buyer.
“Supermarkets will have the biggest turnover rates,” says Jon.
“Or the meatpacker,” Jake replied.
“Commercial banks will probably have the largest liquid assets
and liabilities due to deposits
and withdrawals,” he said the Taiwanese.
I could tell Justin was just as stuck as I was,
based on the way he was constantly scratching his head and chin.
“Hmm,” I exclaimed.
“I’m wondering who can make 16.7% profit margin. Gem shops?”
I’m just trying to say something.
Everyone looks at the numbers,
trying to figure out what they mean.
We look at the debt/asset ratio.
A company with many fixed assets, such as factories,
is more likely to be in debt than an advertising agency
whose main assets are only people.
One of the most unattractive
and biggest shortcomings of corporate accounting is treating people
as just an expense in the income statement,
never as an asset in the balance sheet.
Unlike a factory,
people can leave at any time,
so banks are often reluctant
to lend money to advertising agencies,
law firms and architects’ offices.
We glanced at the net sales/net assets ratio,
trying to figure out which companies made the most revenue
from their assets.
The advertising agency,
which has nothing but rented office space and a few properties,
has a high ratio,
which means high revenue from few assets,
while the ratio is lower in factories.
After an hour,
we identified half of the companies.
After two hours,
the number had reached eight companies.
When the third hour passed,
it was as if we would never finish our homework.
Just when we thought it was the aviation industry,
it seemed like the automobile industry.
Maybe it’s the famous men’s clothing manufacturer?
I began to feel the energizing effects
of the fluorescent lights,
the vague discomfort of the smell
of Chinese noodles emanating from the wastebasket,
the dryness and itchy skin.
Half of the students in the room were checking email
and surfing the Web,
which is why a question was asked a while back
before receiving an answer.
Through the window,
I saw the huge shadow of Harvard Stadium against the dark blue night sky.
The discussion that had begun
so lively had now slowed down like a lullaby.
Our words and thoughts become sluggish.
It was almost midnight when we left.
When I went to the garage,
it was still hot and foggy.
Our apartment is in West Cambridge,
10 minutes by car from the school.
The streets were empty
and this was the first time in 10 years
that I didn’t live in a big city.
Sleeping in an empty apartment in a new city is unsettling.
My life is tied to school and this room
with an air mattress on the floor
and a picnic table brought back from Costco.
I lay there, listening
to every little noise,
a tree branch scraping the window,
cars passing in the street,
headlights shining on the ceiling.
That night, it took me many hours to fall asleep,
and a single question whirled around in my head:
What did I do?
Whatever you believe with feeling becomes your reality. – Brian Tracy
At seven o’clock the next morning, we returned to the “battle”.
The auditoriums in the Spangler building were packed
with students from the Math department
who were “fighting” with an assignment to identify industries.
They were excited to do this exercise.
The classroom vibrated as we discussed profit margins
and debt ratios.
I heard someone say in a bossy tone that banks tend
to have huge short-term debts or,
in other words, money in their customers’ accounts,
which they can withdraw at any time
and have huge revenues equally large, i.e. money lent to customers.
For banks, loans are assets,
and money held for customers is debt.
It took me a while to understand this frank conclusion.
The money they have is a debt,
the money given is an asset.
But as soon as I understood this,
I looked at the industries that were still undefined
and it popped into my head, banking!
I finally had something to share with the group,
and I rushed into the room with my discovery,
but they already figured it out.
It doesn’t matter where you are coming from.
All that matters is where you are going.” – Brian Tracy
In the school there are two main buildings for classrooms,
Aldrich and Hawes, with 30 identical classrooms.
Aldrich is named after bearded Senator Nelson Aldrich of Rhode Island,
whose daughter is married to John D. Rockefeller,
while Hawes is named after Jr. Rod Hawes graduated
from HBS in 1969 and thrived in the insurance industry.
He built and sold Life Re Corporation of America,
then gave most of the fortune to charity.
In each room, there are 90 chairs arranged gradually,
arranged in 5 rows of semicircles and have two aisles.
Only a few rooms have windows overlooking the courtyard.
Sitting in a windowless room,
turning on the air conditioning
and bright lights like this is like sitting in a casino,
no longer feeling anything about the outside world,
not being dominated by time and nature.
Each person has a space the size of two laptops along a curved table
and a swivel chair upholstered in burgundy fabric.
We had to put a white laminated card
with our name on it in a slot
in front of our seats so the teacher could know our names.
The computer socket is located under the table.
Sitting to my right is Laurie, of Alaska,
with a master’s degree in chemistry,
who used to run the research center of a biotech company.
To my left is Ben, formerly
with the New York City Park Board.
For the first two weeks,
Laurie was very nervous.
Although very intelligent,
she is afraid of being called by the teacher.
If you give her a molecule,
she can analyze it,
then reconstruct it.
But if you ask her about an accounting number,
she will mess up.
Ben is much calmer.
He had a beard, wore sandals,
and had been walking for the previous two weeks
along the Appalachian Road. Like me,
Ben is allergic to computers,
so he takes notes with pen and paper.
But he clearly has a very logical and lucid mind,
suitable for this place.
The marine guy is quite short
and has very thick hair.
For several hours a day for the next two weeks,
his unusual muscles flexing and jerking
just a few dozen inches from my face kept me
from focusing on the average cost of capital
and the decision tree determined.
The instructor stands on the floor,
with a table,
three sets of blackboards
and a projector for teaching.
More active people can use videotapes
and the Gizmo program.
Students can vote on any issue
by pressing a button on the desk,
red or blue, and immediately see the results on the screen in front of them.
Instructors can approach students
or get up and down along aisles and between rows of seats.
HBS adopted the teaching by example method
from Harvard Law School.
At the beginning of the lesson,
the teacher assigns a student to present a situation
that we have prepared the day before for about 5-10 minutes.
After that, all students were allowed
to raise their hands to speak.
It could be a question,
or an example from their own experience
to shed light on the issue.
The only requirement is that the idea
is aimed at enhancing the knowledge of the whole class.
Our first instructor, Mr. David Hawkins,
was an unpretentious Australian
who competed in swimming at the Olympic Games in the early 1950s,
still with the muscular shoulders
and blond hair of a rescuer.
House at Bondi Beach.
Entering the classroom,
he opened the Wall Street Journal
and read aloud the story on the front page.
It’s the story of a company
that was asked to re-declare its income due to years of accounting irregularities.
He leaned against the edge of the table,
leaning back, mouth open as he thought.
In one hand, the teacher held a scratched piece of paper,
scribbling about the lesson that day
, the other hand was a yellow chalk.
“You see,” he said after a moment of hesitation,
“the calculation is really the problem
. Now I return to the Baron.”
He stooped and walked around, dragging on one leg,
looking very much like a Baron.
“It’s hard to figure out which farmer does better, isn’t it?”
A sense of relief spread throughout the class.
When the students were called up to explain their approach,
it became clear that no one had solved the problem.
But what really matters is not solving the problem.
The point of this scenario, Mr. Hawkins explains,
is to show how difficult it is to derive economic truth
from the simplest of situations.
In accounting, following common sense is more important than sticking to the rules.
In the Preparatory Program,
the teachers teach not as closely as the Compulsory Program,
but the schedule is still the same.
We were asked to spend at least two hours preparing
for each class discussion situation.
In addition to accounting,
the Foundation Program also includes subjects in finance,
operations management and technology.
Those were the most calculus subjects we were required
to take in the first year.
Mr. Hawkins’ after-hours was the finance course of Mr. Mihir Desai,
a young Indian professor,
tall and elegant,
He won our hearts
as soon as he mentioned very simple financial concepts.
During his class, we don’t have
to stare at computers and complete spreadsheets.
We learn finance in a very easy to understand way.
Mr. Desai has always strongly criticized the confusing words of Wall Street
(American financial world)
and encouraged us to shed all prejudices, if any.
We learned the basics of finance.
I ran into Justin at lunch.
He grew up in New York,
his father running a successful investment business.
After graduating from college,
he taught in Los Angeles for Teach for America
and later worked in the New York City Mayor’s Office.
He came to HBS only
because the people he admired in the public service industry came
from the business sector.
An MBA will help,
no matter what you choose to do next.
I asked him if he knew what to do next.
“No,” he replied. “I am considering.
If you think of something, tell me.”
We hear around the same dialogue.
Where are you from?
What did you do before?
Why did you come here?
After lunch, we studied operations management
and technology by Ms. Frances Frei.
She is an energetic woman, with shaggy brown hair,
wearing a dark shirt and pants.
The first session we worked with her involved the construction
of a decision tree,
which is a means of predicting the outcome
of an investment decision.
If I drill for oil in one location,
it costs me 10 million dollars
and there are two possibilities 30% chance of finding nothing and 70% chance of finding $20 million worth of oil.
Multiply the percentage by 0 or +14 million dollars.
Therefore, the estimated value
of this investment is $14 million minus $10 million in drilling costs,
resulting in $4 million.
The benefit of a decision tree depends on
how accurate you are at estimating the possibilities.
But the purpose of decision trees is not to find certainty,
but to deal more easily with uncertainty
in order to find a fragile buttress
when it comes to financial decisions.
The next class, Ms. Frei pressed us to learn regression analysis,
a means of assessing the importance
of different factors for a particular outcome.
Our case study is a bank that relies on customer data
to decide what to do with online services.
The bank knew everything about the customer,
from the date of birth and tax identification number
to the average balance in the account
and the usage of online banking services.
Ms. Frei asked us to use Excel to organize
and graph these metrics to build models of customer behavior.
If they were near a bank branch,
would they go there more often?
Does age affect ability to use online services?
Influence to what extent?
Is the behavior of customers in different regions different?
The bank wants to use this data
to decide how much to invest in further online services,
costing them less than branches.
Being a complete stranger to Excel,
it took me a long time to organize thousands of cells
of data into clear graphs.
But even as I struggled with the assignment,
I found myself growing more
and more interested in what I learned here.
Why does the bank send me letters differently from my neighbours?
How much money should I invest in a project with uncertain outcome.
Having spent most of my life portraying life in words,
I was truly amazed to see the power of numbers,
models and statistical tools.
I felt so stupid, and the prospect of taking two years
to come up with a completely new outlook invigorated me.
The last day of the Preparatory Program,
the teams were pitted against each other in a financial negotiation.
The subject was an acquisition
of a tractor company,
and our team was a potential buyer.
We met in the evening,
trying to decide how much to buy.
The next day,
some groups were still wearing vestments.
In our group,
soldiers carry the burden
and are persuasive negotiators
and daring tacticians.
We negotiated very successfully.
At the end of the Preparatory Program,
I was exhausted.
Every day, I study from 7 a.m
until midnight just to keep up with the program.
I was very happy to have my family by my side.
But I’m also tired and grumpy.
I was forewarned about the bubble of HBS:
even the most mundane missions take on ridiculous dimensions,
that’s completely true.
And this is just a rehearsal.
Your greatest asset is your earning ability.
Your greatest resource is your time. – Brian Tracy
The first year of HBS’s two-year MBA program is called the Compulsory Program (RC),
which consists of 10 subjects,
5 subjects each semester,
covering the basics of business.
The subjects of the first semester are: finance 1,
operations and organizational behavior.
Semester 2 includes: finance 2, negotiation, strategy,
leadership and corporate responsibility (LCA)
and a macroeconomics subject called business,
government and international economics,
collectively known as “Biggie” (meaning “Big Man”).
During the second year,
also known as the Choice Program (EC),
we have the choice of coursework or independent study.
We are graded on a limiting curve,
based on our own performance relative to others.
The top of the curve is the elite,
the bottom is the weak.
In each subject, our 50% rating depends on class attendance,
quality and quantity of speeches in class.
The remaining 50% is based on the results of the mid-term and final exams.
Halfway through the semester,
the faculty will evaluate our contributions to the class,
so we know how we’re doing.
Over two years, the top 5% of students in their class will receive a Baker Scholarship,
which is the highest academic honor.
The next 15% will get other rewards.
When your study results are below average,
you will be alerted.
If your academic performance is consistently poor,
you will be suspended or expelled.
If you attend all the sessions,
prepare the case studies in advance,
and work hard to speak,
then you don’t have to worry about it.
I always wondered how I would compete with these students
when I had no business experience at all,
and they had graduated from universities in finance
or business and had many years of honing their craft. skill?
The first time I met full class is the end of August,
when everyone comes to learn the basics
for a week to be able to participate in the Compulsory Program more easily.
We gathered in the Burden Foundation room,
cave-like room in the center of the faculty campus
with steeply sloping seats down to a stage.
Mr. Rick Ruback, Director of the Short, U-shouldered,
Boston-accented Mandatory Program was standing on the podium.
He said that our class has 895 students,
selected from 7,100 applications,
the acceptance rate is 12.6%,
so we are very lucky to be admitted here 34%
of the students are female,
32% are from other countries.
The average age of 27 makes me,
already 32 years old,
the oldest in my class.
Students include Olympic athletes,
former assistant to J. Paul Bremer U.S. Governor-General
for the Interim Coalition in Iraq and a Harvard MBA,
even even the “former head of the Daily Telegraph in Paris” is me.
Next is the principal.
I read his biography on the school website.
He came to Harvard as a student, earned his doctorate,
and rose through the ranks of the university.
He used to be a Scoutmaster,
Bishop of Mormon and has 7 children.
He hooked a pair of glasses with semicircular eyes on a necklace
around his neck and spoke in a sad whisper.
He talked about the purpose of the school
and gave us three pieces of advice:
work hard; be humble, or rather “practice the habit of humility”
and do not be afraid to meet your teacher on the street
or in the department.
After Mr. Clark, came the speech of Margia Yang,
CEO of Esquel a shirt manufacturer in Hong Kong.
HBS had to re-evaluate the school’s way of teaching business ethics
when the Enron Corporation collapsed
under the leadership of one of the most warmly welcomed MBAs, Jeff Skilling.
Yang’s speech also focused on business ethics.
Sometimes it takes a moral transgression to survive.
Her bigger point is this:
business ethics is about adapting as kindly
as possible to changing circumstances
and following strict rules.
Business ethics is a dynamic concept,
not a static one,
and don’t judge on this matter
unless you do business in a place like China.
Finally, a sophomore stood up to salute
and reiterate how important our values are
to our future in business.
He said that just being accepted into HBS means “You have succeeded”.
From now on,
all we care about
is how we are in control of our lives.
From Burden’s room,
we walked to the classroom
where the first subject of the Compulsory Program was leadership.
The situation we studied
that day was a small family-owned ice cream company whose director was in trouble.
corporate profits are in free fall.
The atmosphere in the classroom has changed a lot
since the Foundation Program.
Everyone is full of confidence
and enthusiasm to speak up to get points.
The period of flamboyant speech in the classroom begins.
Students now say “module” for lesson,
“future” for future,
and “consensus building” for agreement.
I always get annoyed
when the conversation turns into consensus-building,
it’s like a prelude to sad group compromise.
The next day, we played “Crimson Congratulations,”
described as “a game that brings excitement to every subject.”
The class is divided into 6 or 7 groups, each of about 10 people,
who will compete in building and running a greeting card production business.
The goal is to run the business in the most profitable way.
We had to buy materials, control inventory,
design and manufacture the cards, set prices,
and then sell them at set intervals over the next two days.
After each sales session,
each team and a trainer will quantify,
evaluate and discuss their performance.
However, the learning objective is
only second in this exercise,
the larger goal is for students
to get to know each other.
At the beginning of the lesson,
we were shown a video tape.
In the tape, a rude British man says in a menacing tone:
“Your job is to run a greeting card company
and make it profitable.”
Then we went to the gym across the street,
across from the school.
The room packed with 895 students participating in this game
became as noisy as the African jungle.
Lions roar, birds quack,
chimpanzees pound their breasts, and crocodiles snap.
Our team consists of three management consultants from Austria,
Indonesia and Canada, a Korean banker from Los Angeles,
a Chinese shoe trader from Texas,
and an Argentine central banker ,
an Argentinian engineer,
a Lebanese-American investment banker,
a biotech executive from Boston,
and Linda, a small, scowling New Yorker,
former home management consulting
and management of a company
but it is said that her true passion is gender and racial equality.
Our first task is to assign work.
Linda took control.
She said she is a negotiator,
so she will buy ingredients and help with sales.
Gunther, an Austrian,
also followed Linda.
The rest split the production and distribution.
One person will check the quality.
Another person has to make sure the card is delivered in a timely manner.
I volunteered on a card production team with two Argentinians
and a Lebanese American that involved cutting paper,
gluing, sprinkling glitter,
and writing wishes.
First, we have to design a Christmas card.
We decided on a simple yet elegant pattern for quick production.
We draw a triangular tree,
dotted with silver glitter,
inside the card is the usual greeting “Merry Christmas”.
Linda rushed to buy supplies while the materials
for making cards were scattered on the table.
I stood at one end of the table,
cutting paper into cards.
Two Argentinians stood ready
to sprinkle with glitter and write wishes,
while the Lebanese-American banker held a blue pen to draw a tree.
The rest of the team surrounded us,
preparing for material deliveries,
timings and quality checks.
A whistle blew and we started.
I cut the paper as fast as I could,
and the Argentinians hurriedly sprinkled the glitter.
Over the next half hour,
we made a bunch of cards until the whistle blew again.
After that, we went to the other side
of the room to talk and rest,
while the organizers examined our desks
and recorded the results.
Linda sat cross-legged, irritated.
She is clearly frustrated.
“The group next to us delivered more cards,”
she said, “and we wasted a lot of material.
We have to work hard in production to increase the quantity.”
The two Argentinians looked at me
and were about to burst out laughing.
But we seriously nodded.
“The quality is not good,”
Linda said, glancing at the list on the cover
of the briefcase she had purchased with our materials.
“And we didn’t deliver a batch of cards right before the game was over.
We need to try harder.”
Raphael and Ernesto,
whispered to each other.
Linda held up a tiny finger.
“We need to talk.”
They were silent.
Gunther rose to his feet and began:
“We need to think about the presentation at the end of the game, shall we?
I think we need to make a chart,
the x-axis is time,
they-axis is the financial performance
to show how we’ve improved our performance.”
Linda looked up at Gunther affectionately.
Finally someone figured it out.
“What does he say the y-axis is?”
the Indonesian woman nudged me in the ribs.
“Financial performance,” I whispered back.
“Hey, do you guys want to share?”
Gunther said, turning to stare at us.
“If you’ve talked, you’ve got to tell us,”
Linda agreed, smiling.
Round two of the game is making cards for Halloween.
While we were trying to think of good wishes,
for the first time since arriving at HBS,
I came up with an idea.
“Happy Masquerade Festival!”
That sentence is both appropriate and easy to write.
This comment is selected.
The production of the cards went much faster this time,
but Linda still scowled as she walked around the table.
When we finished the first batch,
she picked it up,
glanced at it, then angrily threw it on the table and yelled, “What is this?!”
Then, due to poor negotiation,
she brought us blanks and brushes of the wrong type.
A Canadian woman,
who had been silent until now,
began to mutter curses.
During the next break,
Gunther took his place by the board again.
“We have to make a Gantt chart!” he declared.
“A Gantt chart!” shouted Linda, laughing.
“What is a Gantt chart?” I asked Raphael.
“It’s a bar chart used to organize a project’s agenda,” said the Indonesian.
Unfortunately, a riot ensued.
In the end, our manufacturing savior is Ernesto,
because his forte is craft.
After two rounds,
he was able to rapidly mass-produce beautiful cards.
He gave us some basic paper cutting
and folding tips
and we started again.
When it came time to present,
Linda and Gunther mapped out timelines
that were so complicated
that they completely forgot about our main mission.
They couldn’t clearly state
that we were producing greeting cards.
While two Canadians
and Koreans prepared their presentation,
it was much more meaningful.
Because I speak English
and have a bit of experience in public speaking,
people suggested that
I and my Chinese friend present on behalf of the group.
When asked what I have learned from this exercise,
I answered it was communicating
with many people and described a moment when I,
a British, discussed with an Indonesian
and two Argentinians about the reason
for choosing “Masquerade” to include in the Halloween card.
Linda and Gunther have shown me
that just two mentors can mess up a project.
One drives everyone crazy,
the other laughs at his antics.
At the end of the second day of this game,
I ran into Justin and we exchanged notes.
I told him about Linda’s derogatory comment.
He said: “Every organization has people like that.
They always go off topic
but insist on forcing people to listen to them quietly.”
After the “Crimson Congratulations” game,
we went back to class for our first lesson on the origins of modern capitalism.
Sitting to my right is a lithe blonde woman
who has worked diligently
for three years at a New York-based private equity firm specializing in real estate.
She said she came to HBS just to rest.
She wasn’t hoping to learn much,
but was just waiting to get some sleep,
get out of work, and take a long break.
The person on my left is a former financial journalist,
often acting nonchalant by never bringing a textbook,
but whispering comments to me during class.
In one lesson, we learned about the history of Rolls-Royce
and the current state of capitalism in Britain.
During World War II,
Rolls-Royce was called upon to mass produce combat aircraft
Within a few months,
they had assembled a vast network of subcontractors
to help them produce faster and more reliably.
One woman, a Boeing engineer,
said her former boss wouldn’t have imagined being able
to outsource on such a large scale,
the company often wanted to do
as much on its own as possible.
A Frenchman who runs a factory located in Russia
of a large French food company confided to us:
“Where I used to work, it took 6 to 7 months to decide to re-contract,
then another 5 months negotiate
with subcontractors to reach a reasonable agreement,
add another 6 months to start the process.
We’re just following the same path.”
The lecturer asked me to give my opinion on whether Britain would go into recession or not.
I answer definitely no.
Or rather it depends on one’s point of view.
Of course, Britain is no longer an empire,
but it is still a stable and prosperous economy.
It’s still one of the wealthiest countries in the world,
with an extensive, safe-haven social welfare net just in case.
My comment provoked some objections.
The Russian friend said that in his experience,
the British are lazy and incompetent.
A young American manager
who lived for a year in London said
that the subway is not working
and that in general services
such as shops,
restaurants, airports and public services are terrible.
The idea that Britain is still a big country is ridiculous, he said.
I said I’ve lived in England,
France and the US,
I have evidence to back it up
and can’t say one is better than the other.
I compared the shared health care of England
and France to the $11,000 check
I just wrote to buy annual coverage for my family in the US.
I could see the American scowling at me from across the room,
but the Frenchman approached me
and said he appreciated my support for their continent.
“I’m sorry you were swallowed,” he said.
Swallowing is a term used to refer to students
who unreasonably doubt the judgment of others.
I didn’t take the American banker’s hostility all seriously,
but it was clear to the rest of my class.
I was swallowed.
Imagine no limitations;
decide what’s right and desirable
before you decide what’s possible. – Brian Tracy
The last day of the foundation week,
we returned to the Burden building to listen to Mr. Ruback speak and give a slide presentation.
He showed us the anxiety curve in HBS,
where the horizontal axis is time
and the vertical axis is mental stress.
The curve starts at the top,
descends as the semester goes on,
spikes at test time,
and doesn’t show up on the graph during admissions season.
The next slide breaks down the week of study
so we know what the course requires of us:
55.1 hours of study per week,
including classroom hours and at least two hours of home preparation
for each situation research.
Based on what I have learned in the Foundation Program,
I know that number is much lower than it really is.
We won’t have much time left for other things,
but Mr. Ruback says it’s a challenge.
HBS forces you to choose.
What is your ambition?
What is your obligation?
Are they suitable?
If not, what do you have to do to change one or the other?
How do you use your time to get what you want?
For many people, 55.1 hours of study a week is like a breeze.
Because with their previous jobs,
they often worked 80 to 100 hours per week,
they have mastered much of the knowledge of the first year of school.
I am not among them.
At the end of his talk,
Mr. Ruback recounted an anecdote about
argued with someone on the school board.
When he was so angry, the student shouted,
“Why are you treating me like that?
I’m the customer, damn it.”
“No, you are not the customer”,
the person replied,
“You are the product”.
“I guess you guys are confused between the two concepts,”
said Mr. Ruback as soon as the laughter died down.
“Sometimes you are the customer,
other times you are the product.”
After Mr. Ruback’s speech,
we went to Aldrich’s house to meet our class.
Class division is HBS’s most positive socializing and relationship-building action.
During your first year, you will study with 90 other people.
They will be the focus of your academic and social life.
Each class is a miniature copy of the 895-person course,
equal in male/female, American/international,
and ethnically and ethnically diverse.
From now on, the school will treat us as a class.
Every 5 years, we have a class reunion.
Fundraisers also call for class-based donations.
As long as HBS cares,
I will forever be a member of Class A, class of 2006.
Our class 107 is located in the Aldrich building,
in the basement, next to the boys’ restroom.
When we arrived,
our nametags were already in place.
I sit in the middle of the class,
on the left side, facing the board.
It’s a nice, central location,
not too close to the front and a bit hidden.
Before class started,
we had access to a database of photos and résumés of class members,
so when we walked into the class we could recognize each one.
This is extraordinary: you’ve grown up
and are able to control your own circle of friends
and now you’re suddenly thrown into a classroom
of strangers with the message,
“This is going to happen.” is where it all begins.”
But when I look around, I find it very interesting.
After 10 years of working,
I had the opportunity to go to school again.
I was seated between two students from the military.
On the right is Bob,
the pilot of the Stealth bomber.
I met during my Preparatory Program.
Medium Bob with straw blond hair and pale blue eyes,
had four children and always brought lunch from home.
Bob seemed resolute and lacking in humor,
the kind of man to fly such a multibillion-dollar military weapon.
He entered business school
because he was tired of pilot life
and wanted to find great opportunities
for himself and his family.
He was 35 years old and could not continue to waste time.
To my left is Lara, who will return
to the West Point Military Academy to teach as soon as she gets her MBA.
Bob bombed Iraq from above,
and Lara ran the supply and accounting departments in the unit on the ground.
Both Bob and Lara embody one of the three M’s that are said to characterize HBS:
Mormons (Mormon cult), Military (Military),
and consulting firm McKinsey.
The first Mormon follower was headmaster Kim Clark.
The head of the admissions department is also a Mormon,
and there are four Mormons in my class, including Bob.
For many foreign students, and even American students,
this was their first exposure to Mormons,
and their distrust fueled colloquial jokes about polygamy.
Regarding the military,
there are five students who have served in the army, including Bob.
The consulting firm McKinsey seems
to see the school as its own recruiting and training facility.
When the course started, there were five of McKinsey’s in my class,
and by the time we graduated there were four more.
Head teacher Ben Esty is a young finance professor
who is the bridge between us and the school administration.
He does not teach, but certifies and guides administrative procedures for us.
The teacher strode across the class,
brushing his hair down from his eyes
and eloquently talking about the importance
of the class group
to each person.
We will forever remember each other.
Classmates will be the first people we turn to
for help at work and even in our personal lives.
Hand in hand, we will traverse the jungle of the Compulsory Program,
guiding each other through the swamps
of ignorance and possibility,
toward sunlit heights of power and opportunity.
It sounds like a movie,
in which there are lost people,
each with their own gifted explosives expert,
one good at camouflage,
the other good at karate gathered together
to carry out a dangerous mission.
Then we played a game of getting to know each other.
This time, we had 10 minutes to confer
with others in line and find common ground.
It’s a little bonding exercise.
Bob volunteered to lead the conference.
Eva, the slender woman
who was once a trustee of a Mexican cement company,
seemed timid and did not know how to present herself.
The game starts from the middle of the second row.
A male student on the right stood up
to introduce himself very naturally,
then went on to the next person
until he found one thing in common with everyone in the line.
The game resumes with another row.
End of the game, Master Esty good luck
to us and let the class disperse.
From the back of the class,
Misty, a veteran, shouted,
“Has anyone come to the Red Line for a beer?”
The cheers resounded.
She stood at the door of the classroom,
waving to everyone passing
by as if they were soldiers parachuting from a plane.
After experiencing a sense of discovery in the Preparatory Program,
I now suddenly feel depressed.
I left Paris because of this?
People rush out for beer?
Are they hoping to kick-start their social lives?
Outside, on the lawn between the Aldrich and Spangler buildings
, the Student Union had set up a tent
with a bar and a giant sound system.
The Black Eyed Peas are playing a piece of music.
I try to hear the lyrics.
Is this really a chorus?
I listened again while heads bobbed around me.
That’s right. “Slow down here, slow down.”
Today the greatest single source of wealth
is between your ears. – Brian Tracy