Graduate study is not essential to a successful career in finance. The highly fruitful careers of a great many men who have not had graduate training for business, or for that matter college training, provide abundant support for this statement. But graduate training should help--later on in this article I will indicate just why and how.

There are many quite different graduate programs which are aimed at preparing men for a career in business and in finance. Since my experience with education for business has been primarily at the Harvard Graduate School of Business Administration, this article is written primarily in terms of graduate work at this school.

The more important question regarding graduate study facing the undergraduate considering a career in finance is: "Will graduate study help me enough to be worth the cost?" or in financial terms, "Will an investment by me in graduate study yield a satisfactory return?" As the bold type suggests, the answer to this question depends a great deal on the individual and his particular circumstances. The price of the investment and the value received are each highly subjective.

Time Factor

Monetary cost is the first consideration in weighing graduate study. Almost all current college graduates can find a job in finance upon graduation in which they can be self-supporting. If they undertake a two-year graduate program, the total cost averages between $4,000 and $5,000 for single men and obviously more for married men. Even after one subtracts $500 to $1,200 for income that could be earned during the two summer vacations, the amount for all but the wealthy men is a very significant one. Fortunately, in many graduate schools scholarships and other financial aid now are available in substantial amounts. At the Harvard Business School financial aid is in the form of long-term loans rather than gifts, but we are proud of the fact that any student who is willing to take on a substantial obligation can obtain the funds to finance his graduate study.

For most men the time invested in graduate study is more important than dollars and cents. This is particularly true for men who must devote two or more years to military service after graduation. In general, the older the man is after college or service, the more important is the time investment in graduate study. The man coming out of college or the service might well profit more from two years on the job than from two years in further study. This is particularly true when the graduating senior has an especially attractive job opportunity that may not be open two years later.

Also to be considered is the cost in effort involved in graduate study. A good program calls for rigorous, consistent effort for everyone regardless of their ability. The work week is long, with heavy study at night and through much of the weekend. Many men find the work harder than would be experienced in actual business. We do have a few men like a recent Harvard College graduate who resigned from the Harvard Business School in mid-November frankly explaining that "to me it just is not worth the hard work I am putting in."

Risk of failure in the graduate program might also be considered a cost of graduate work. Despite a careful selection process, not all men admitted the school can handle the work and some are dropped for scholarship reasons. The man with a good college record finds failure in graduate school a most unpleasant experience.

There is the additional hazard that the immature graduate student will gain the mistaken impression that his graduate work places him on an easy escalator to high responsibility and success. On the job such men soon find that education is no substitute for hard work and "drive" and discover vigorous contemporaries with sharp elbows and keen if unlettered minds moving past them.

Now let us consider what the typical man can expect to get out of his considerable investment in money, time, energy, and risk-taking in graduate study; then more specifically how this investment can help in preparing for work in the field of finance. It would be helpful if I could forecast the extra earnings that will accrue as a result of his graduate study. Although considerable data has been accumulated on the business progress and incomes of our graduates, we do not have enough to justify any real conclusions. Several factors limit the usefulness of the available data--for example, the fact that reports from graduates are voluntary and thus may not be a representative sample, and the more basic fact that it is difficult to judge whether one's success or lack of it is due to the Business School. We do know that starting salaries for our graduates in 1954 average $4,800, which seems significantly above levels for arts college graduates generally. But starting salaries by themselves mean little.

Sharpen Thinking

Without reliable statistical data as to the results of graduate training I will speak in terms of my own experience with students at the Harvard Business School and what I think I see happening to them in their two years here. First, through such a graduate program, almost every man appears to sharpen his ability to think constructively on business problems. During his two years at the Business School the student studies more than 1,000 case problems drawn from actual business situations. He is asked to analyze these cases and to work out a sensible program of action on the problem. Although the elusive and yet extremely important quality of good judgment is not easily learned in school, judgement based on habits of this careful analysis is likely to be very much better than judgment based on hunch or snap conclusion. Consequently, the individual's ability to tackle a problem and reach sensible judgments should be advanced in important degree by his graduate study.

Second, the man should enhance his ability to express his ideas both orally and in writing. He learns to put forward his own ideas and to defend them against the attacks of fellow students or the intellectual assault by his instructors. Skill in these respects is no small asset in business.

Business Knowledge

Third, the student should increase his ability to work with others in group activities. Much emphasis at the Harvard Business School is placed on group efforts, on cooperating and working with other men in getting a job done.