Fourth, in the course of his study a student should gain a considerable knowledge of business. He should esquire a sizable body of facts about business and an understanding of the vocabulary of business. For example, he will get a basic knowledge of accounting, which in many respects is a language of finance. Furthermore, the cases be considers often are about key problems in business. Yet at the Harvard Business School the acquisition of substantive knowledge about business is an objective definitely secondary to the object of developing effectiveness in constructive thinking. In line with this view, the number of courses offered in the various functional areas of business such as finance is limited in comparison with the offerings in some other schools more concerned with imparting substantive knowledge in specialized subjects.
In the course of his study the student should mature rapidly. Many men grow up fast in graduate school, gaining poise and self confidence. The college graduate lacking maturity and allied characteristics upon entry into business will come along slowly into business. As an executive commented to me recently, "We have a young Phi Beta just out of college in our bank. He is a big gangly kid. Unless he develops on the job much faster than I expect, it will be quite a while before we can have him represent the bank with important customers."
Further, graduate study helps many men to mature fast and to find their own career interests. Many men just out of college know little about business or what they want to do in life. In planning their carcers, such men are highly vulnerable to reliance on such cliches as "I want to do personnel work because I like people." Through his graduate study the man has the opportunity to learn more about what work in the various aspects of business will be like and to reduce the chance of false starts in lines that are unproductive. For many men graduate study opens up career opportunities that are better than those available to them just out of college. The able man can gain something from the reputation of the alumni and the School in being considered for excellent opportunities.
Study and Finance
So far I have spoken of graduate study as training for business in general. Now let us consider how such training can contribute to a career in finance.
A first comment is that the word "finance" is applied to a wide range of jobs. To make my point I shall list a few of the different types of institutions offering job opportunities in finance. There are some 14,000 commercial banks in the country, along with numerous savings banks, cooperative banks, and savings and loan association. There are many job opportunities too, with investment companies, with trust companies doing investment work, with those large amassers of capital, the insurance companies, with the finance companies and other firms administering the tremendous volume of consumer credit in this country, and with commercial credit and factoring companies. Jobs within these companies differ widely, including work predominant in sales, personnel, general administration, or service activities.
Often overlooked are the large number of opportunities in connection with the finance function within manufacturing, retailing, and other nonfinancial concerns. While the "financial" jobs in these various financial and nonfinancial institutions and functions are quite varied in nature, finance is business. Although work in finance does require some special knowledge and skills, the executive in finance is continually concerned with the various aspects of decision-making and administration common to all business, so in a real sense, training for business is training for finance.
Broad Thinking
In many financial jobs breadth of thinking is particularly important. Take the case of a loan officer in a rather large bank nearby who must intelligently administer his bank's credits to companies in the following industries: chemical, leather and shoes, finance (consumer lending), lumber and wood products, and building materials. The pressing problems of the company are inseparable from, and often the common denominator of, all the activities of the firm. To administer credit effectively, the banker must be above all a good businessman. He must understand business and the activities back of the figures with which he works.
Further, most financial businesses have to be effectively operated to make money under current conditions. The balmy days of the 1920's when the personable college graduate with good contracts and a nice smile could make good money as a customers' man are over. Salesmanship and contacts still are useful in finance, but financial business needs men with more assets than these. As other doubtless will write in this edition, there are excellent opportunities for men coming into finance jobs today. But the excellent opportunities are for good man, well trained, who can product results ino a competitive, not a lush, environment.
Long-Run Investment
Graduate training for finance is very definitely a long-run investment. Starting salaries in finance are not high, and, unless the man takes a highly specialized program in one aspect of finance, his academic work is no substitute for training programs dealing with particular operations and affairs. Although less true today than 25 years ago young men do not advance fast in finance. So in his first years on the job he may see few direct results from his graduate work. But the graduate training should put him in a position to learn more readily from his job and to profit more from his experience on the job.
If it has sharpened the individual's ability to think effectively, graduate training should speed up his usefulness and help him move up the ladder of responsibility faster and further. For many men, particularly these of ability, drive, and a real desire to move to upper levels of responsibility in finance as in other areas of business, graduate training may well be worth the considerable investment required.