1st Years: Highly Leveraged, Yet Undervalued...
Jodi Glickman '02
Issue date: 2/13/01 Section: Viewpoints
MFI and IBI students now know that increasing leverage (debt, that is) increases the value of a firm. As part of the MFI elite, I relayed this newfound knowledge to a friend in SiM who smiled enthusiastically at the news and proclaimed, "Well then I must be worth a lot more now then I was before b-school."
Exactly. Laying aside the technicality of the generalization (yes, I know it's because of the tax shield, but for argument's sake, let's just run with it), this basic tenet of business extends to each and every one of us.
Extremely indebted b-school students are worth more now than we were six months ago. I'll say it again. We are, as a group and as individuals, worth more today than we were in August. The reason I say this so emphatically is because many of us are beginning to doubt this implicit truth.
Instead of thinking of the intrinsic value of learning or of the extensive and amazing network of peers and professors which now surrounds us, we are choosing only to focus on the negative: the undeniable fact that many of us are jobless.
Of course we're jobless. Isn't that what we came back to school for-to be students again? To relish the opportunity to expand our horizons, increase our sphere of influence in the world, to take risks and challenge ourselves continually?
Every one of us left our job willingly last August, certain of the added value of an MBA education, committed to the long-term investment of self-improvement. Even if we couldn't articulate it at the time, we all knew intuitively that we were creating positive NPV projects in ourselves. So where is that idealism and energy now?
Too many of us are walking around and judging ourselves based on the number of closed lists we're on; diminishing our self-worth to a single performance in a 30-minute interview, convinced that we are now un-employable. As if, suddenly, we've lost all value in the marketplace.
Admittedly, things are rough this year. The economy is in the toilet according to first-years aspiring to join Wall Street. Consulting firms are canceling interviews. Hewlett-Packard's marketing department laid off 1,000-plus employees, leaving future brand-managers mystified. Students are left dazed and confused, wondering what to make of the chaos.
Exactly. Laying aside the technicality of the generalization (yes, I know it's because of the tax shield, but for argument's sake, let's just run with it), this basic tenet of business extends to each and every one of us.
Extremely indebted b-school students are worth more now than we were six months ago. I'll say it again. We are, as a group and as individuals, worth more today than we were in August. The reason I say this so emphatically is because many of us are beginning to doubt this implicit truth.
Instead of thinking of the intrinsic value of learning or of the extensive and amazing network of peers and professors which now surrounds us, we are choosing only to focus on the negative: the undeniable fact that many of us are jobless.
Of course we're jobless. Isn't that what we came back to school for-to be students again? To relish the opportunity to expand our horizons, increase our sphere of influence in the world, to take risks and challenge ourselves continually?
Every one of us left our job willingly last August, certain of the added value of an MBA education, committed to the long-term investment of self-improvement. Even if we couldn't articulate it at the time, we all knew intuitively that we were creating positive NPV projects in ourselves. So where is that idealism and energy now?
Too many of us are walking around and judging ourselves based on the number of closed lists we're on; diminishing our self-worth to a single performance in a 30-minute interview, convinced that we are now un-employable. As if, suddenly, we've lost all value in the marketplace.
Admittedly, things are rough this year. The economy is in the toilet according to first-years aspiring to join Wall Street. Consulting firms are canceling interviews. Hewlett-Packard's marketing department laid off 1,000-plus employees, leaving future brand-managers mystified. Students are left dazed and confused, wondering what to make of the chaos.