More Recruiting Tips

Hat tip to fellow consultant and recruiting buddy S. Chen who not only presents a lot more useful advice but also an amusing tidbit which I’m sure too many students undergoing recruiting can probably also relate to:

“It’s okay if you fell asleep at a company presentation – I did that for my own company’s during the process! I know, so sad, but try to sit in the back if you’ve been having a rough day.”

In her defense, it was a very boring presentation made by people who, while bright and interesting, did not seem to be trained in how to convey those feelings about their work.

Recruiting Tips

With recruiting season kicking into full speed in campuses across the United States, I felt it might be helpful for some if I share some tips I picked up from this past year, divided into the four phases I enumerated last time.

Phase 1: Presentation

1. Go to the presentations – I stand by my original claim that there is not much you can do to improve your odds of getting a job offer by going to a presentation, but not only is there the slight chance that you might improve your odds, but there is a reasonable chance that you’ll learn something about the company so that when you are trying to pick between firms once you received your offers, you’ll be in a better position to judge where you’d actually want to work.
2. Ask questions – The more you know about a company, the better position you’ll be in to talk in an interview about why you want to work for that company — even if it’s just bullshit coming out of your mouth.

Phase 2: Resume Drop

1. List academic awards – If anyone’s ever told you that “GPA doesn’t matter”, guess what, they lied. The truth of the matter is, most firms get thousands of applications, and they have almost no good way to distinguish between applicants, therefore, one of the first filters they apply on the resumes they receive is usually a GPA screen — it’s the only way they can quickly determine who actually worked in college (and thus might actually show up to the job) and who’s “smarter than the average bear”. Of course, if you’re working on your resume, it’s probably too late to up your GPA, but listing academic awards can quickly boost one’s “apparent smart-ness” and may win you just enough distinction to be taken seriously.
2. Use action words – Look at your resume. If every point does not being with a verb explaining something that you did, then either delete or fix it. If the action word is something like “assisted” or “helped” or “attended meetings”, then replace it. When a recruiter reads that, one of the first thoughts that come to mind will probably be “so instead of actually doing something, you sat on your hands and watched/attended a meeting?” Yes, it is a hasty generalization to make, but tough luck, you’re dealing with people who can only make hasty generalizations about you, so make them good generalizations. Make sure all your points are full of action words. Real action words.
3. Give specific numbers – Nobody really believes the numbers that they see on resumes. But, their emotional impact and the boost in one’s credibility are real. Do I really think you managed that $10,000 budget all by yourself? No. But do I think its impressive that you were involved in the budget effort of a group that had $10,000? Probably. Using a number tells the world, “hey, the job I did, even if it was just deliver coffee, was important — and I’m so confident in myself that I’m willing to tell you all about it.”
4. Revise revise revise - Tons of perfectly good resumes are rejected for pathetic reasons. Grammatical mistakes. Spelling mistakes. Not following the instructions. Seriously, if the instructions say, “tell us your GPA and your mother’s maiden name.” They both better be there. Failure to do so says that you’re sloppy, can’t follow directions, and will probably be just as sloppy and incapable of doing what’s needed in a job setting. Make sure that you read, and re-read your resume. Then make sure that your friends read it. That your career counselor reads it. And then read it some more. Incidentally, make sure you do the same thing for your cover letter. Nobody reads your cover letter for any real content, except to make sure that you haven’t done something stupid — like use a competitor’s name (has happened many, many times).
5. Use the largest font and the largest margins you can. LaTeX embodies good text output. And it uses huge margins and large font. While this isn’t always possible in a resume which you have to cram onto one piece of paper, it should be noted that even the most rational of human beings is positively swayed by clean, clear layout. So, use big font and big margins — reviewer happy. Use tiny font and tiny margins — reviewer thinks its the textbook in college that he never read (and that you probably didn’t read either).

Phase 3: Who Got the Interview?

1. Relax. You’re going to get the interview, if you’re going to get the interview. There’s not much you can do after you submit the resume, so there’s no point stressing about it, there’s no point getting angry at people who got interviews that you didn’t, and there’s no point in doing anything but relaxing. A few months later, you won’t even remember the names of the firms that rejected you.
2. Practice. If you’re doing a consulting interview, go buy Marc Cosentino’s Case in Point which was written by a Harvard career counselor and is essentially the bible for consulting interviews. It gives a quick-and-easy overview of the consulting interview setup and has many practice cases you can do with friends. Regardless of what job you’re applying for, however, practice. Practice delivering answers to standard questions that you should NOT trip up on (e.g. “why do you want to join this firm?”, “what’s your greatest strength?”, “why consulting?”, etc.). Practice doing quick mental and pen-and-paper math that almost every firm will throw at you in a college-level job interview. Practice doing case interviews. Practice — it will make you less nervous during the real thing, and it will make you better.

Phase 4: Interview

1. Be polite. Unless your House MD brilliant, you won’t be able to get away with being rude. And, let’s face it, quick 30 minute interview rounds don’t give you enough of a chance to be brilliant. So, while showing basic courtesies won’t get you the job, failure to do so will almost certainly disqualify you — because everyone else is on their best behavior and so you need to be as well. So, no offensive jokes, and make sure you thank them verbally and by email after the interview.
2. Slow down. As a debater in high school, I found that speaking really quickly and still being clear and intelligent were not mutually exclusive. Most people don’t feel the same way. If anything, most people find the speakers who are able to pace themselves slowly (although not painfully slowly) to sound more confident and intelligent. So, take a deep breath and speak slowly — you’re probably nervous enough that it’ll speed up to just the right pace.
3. Get sleep. It’s commonsense, but most college students don’t. So it’s worth mentioning here. It’s hard to seem intelligent when you’re sleepy — instead, you may seem bored, lazy, unsure of yourself, or just plain sloppy.
4. Hand gestures. If you’re the type of person who can’t control them, keep your hands on the table. If you’re the type of person who can, then use them to emphasize points. Crazy, out-of-control hand gestures make you look stupid. But, well-done hand gestures can communicate understanding and gravitas.
5. Write stuff down. Two reasons for this. The first is that nobody wants to speak to a dis-interested audience. Writing stuff down while the interviewer talks is a good way to show that you are interested (even if you’re not). The second is that it makes you look organized and methodical.
6. Treat the interview like its an episode of Who Wants to be a Millionaire. Say out loud what you’re thinking. Even if its trivial — although it may seem kind of dumb, it creates a personal connection between you and the interviewer, and it lets the interviewer know where you’re going so that they can either (a) be impressed by your clear thought process or (b) direct you towards the right answer.
7. Let the interviewer help you. Real business problems are difficult. That’s why consultants and bankers and programmers and managers get paid so well. This means that the interviewer knows that he/she will have to guide you to the right answer because any problem can be tackled from many different vantage points. A candidate who refuses to listen to the interviewer’s hints is not only hurting him/herself, but is also demonstrating a lack of understanding of nuance.

Hopefully these tips help some of you out there.

American Civics

Econ-blogger Megan McArdle notes that graduating Harvard University seniors score an average of around 70% on the 60-question Civic Literacy Test (which I’ve kindly linked too because anyone who reads this probably wants to take it to see if they’re smarter than the average bunch of Harvard graduates).

Well, boo-yah, Ms. McArdle (who apparently describes herself as very tall and who wikipedia classifies as a ”tall woman” [6 ft, 2 inches apparently]) – this graduate got a 95%!

How Bad Does Your Company Have to Perform . . .

before the CEO calls the performance “dreadful.”

Apparently, we:

• have to wait for British Petroleum’s upcoming Third Quarter results to find out
• have a wonderful commentary by the British financial newspaper the Financial Times about the proper etiquette in which a CEO is to lambaste his or her staff

Recruiting in a Nutshell

Senior year in college. For many students, it’s a time of joy and a time of reflection. But for those intending to join the finance or consulting worlds, it is potentially a time of stress and turmoil. At the major universities, future bankers/hedge fund analysts/consultants/private equity analysts/marketers/software programmers flock towards their career counselors, polish off their resumes, and prepare for a a few months of recruiting drama and stress.

The general procedure for recruiting at these firms is pretty simple and consists of four phases:

Phase 1: Presentation

The beginning of the school year at major universities brings a multitude of interested employers to campuses teeming with legions of students hoping to grab a piece of the economic pie which is the college-graduate-salary. At these events, major employers shell a pretty penny to rent out campus auditoriums, hotel conference rooms, and local restaurant dining rooms in the hopes that the spectacle will be dazzling enough that the really smart, hard-working kids will be interested in checking out the firm. Words like “exciting”, “room to grow”, “fun place to work”, and “great way to start a career” flow freely as the firm reps shower students with undeserved confidence-boosting praise. In this day and age, the firms also attempt to portray themselves as youth-friendly, talking about how often their firm holds parties and “pub nights” (or some other euphemism for free/subsidized alcohol-providing events), and progressive, stressing their commitment to employing minorities, women, and non-heterosexuals (aka strictly statistically speaking, not the people who show up to recruiting events). At the same time, students, drawn by free food and the hope that they won’t be homeless next year, attend these sessions hoping to get their foot in the door with the right people by saying the right thing at the right time.

It is my experience that with the exception of the really stellar firms and the really amazing individuals or the individuals who already had a “foot in the door”, it’s pretty rare that these events succeed for either party. Students almost never get a real leg up in the recruiting process, and the most any student can hope for is an assessment of whether or not a firm is the right fit for him/her. Firms which lack stellar names, alas, don’t attract the talent they are hoping for and may simply be wasting good shrimp cocktail. But, because every other firm does this, and because every other student is trying this, both students and firms find themselves locked in a pitiful bind where they all have to put up with these fairly low value-adding activity. Thankfully, these events have enough free food and enough people that there has to be someone there who’s interesting to talk to…

Phase 2: The Resume Drop

Following the presentations is, unfortunately, the horrible process of compressing your life into a single page. It leads to many tears as students realize that, had they drank a little less, maybe their GPA wouldn’t be quite so low, or maybe they might have been able to take that leadership position in that one club. The resume session also leads to existential angst as countless students see the past couple years of their life represented on a single, flimsy sheet of paper and wonder — “was that it?”

Yes, really, that was it. And then, fear the firm and give glory to it, for the hour of its judgement is come… (oh and by the way, nobody reads your cover letter — stop working on it and go become president of a club or something so you can put that on the sheet of paper people actually read)

Phase 3: Who Got the Interview?

So, I lied about the phase before this. There are actually some people who’s resumes are truly spectacular. The kids that were made fun of in class for always answering questions in section, always going the extra mile in their extracurriculars — they’re the ones who’re laughing now.

The closest to describing what this phase is like is seeing who made the cut after sports tryouts — except with two notable differences: (1) if every firm were a different sport, the same people would be given spots on practically every single team; and (2) doing well at sports tryouts means you’re good at sports and nothing else, doing well at recruiting means you have a future. Just kidding (or am I?)

Phase 4: Interviews

This is the meat of the recruiting process. At this point, the exact nature of the interview structure varies from industry-to-industry and from firm-to-firm. But typically there are two rounds of interviews. The first round typically occurs somewhere on campus or nearby (aka you haven’t proven yourself yet, so why should they fly you anywhere). For consultants, the interviews are 2/3 case interview, 1/3 fit interview. The former means that interviewers will give students a simplified business problem to solve whereby the student will have to demonstrate some semblance of fluency with numbers, some ability to cope with sudden changes in context or circumstance, and critical thinking ability. The latter is a basic assessment of the candidate’s leadership potential, fit with the firm culture, goals and dreams, etc. For programmers, some programming (*gasp*) may be involved. For bankers, some command of basic corporate finance is probably involved. For hedge funds and private equity analysts, some greater command of statistical reasoning is involved. For those who did well enough to move past the first round, there are subsequent rounds of interviews which are usually held in nicer places and, oftentimes, in the very office that one is hoping to land a job in. It is more or less the same thing as the first round, except the questions are more challenging and the interviewers tend to be of higher tenure and level than those from the first round. Interviews in the second round are sometimes split such that one interview is completely about fit while the other interviews are completely about solving a case.

In truth, the interview questions are never that difficult. The fit interviews usually consist of general questions about one’s resume (so it would be wise for applicants to practically memorize their resume as to prevent the horrible gaffe which is appearing to consult the resume before answering) and general questions which anyone who has done a bare minimum of practice with interview questions should be able to handle without blinking. (But make sure to blink, because else it looks too fake) The case interviews are also never too difficult. In truth, what screws people up is either being flustered by the question or being unable to present and communicate the correct answer. Neither problems are easy to solve, but nor are they impossible to ameliorate with practice (and possibly lots and lots of counseling — “your interviewer is laughing with you, not at you. With you, not at you. Keep chanting…”).  

And, if one survives the grueling experience which is back-to-back interviews, and is actually, I dare say, good at it — then he or she is rewarded with the highest privilege of being a college student: servitude to a corporate entity for the next couple of years which will strip the “winner” of any idealism which he or she might have once had.

Isn’t recruiting grand?

Bake-off

I had the chance to have lunch with a senior partner at my firm yesterday, and got a “in the trenches” feel for the competitive landscape of management consulting.

There are, of course, a large number of management consulting companies. There are the traditional “big three”, Bain, BCG, and McKinsey. There are also other large players such as L.E.K., Mercer, Katzenbach, Accenture, A.T. Kearney, Booz Allen Hamilton, etc. And, there are a lot of niche players — healthcare specialty firms, technology specialty firms, IT specialty firms, finance consulting groups, etc.

What this means is that, although there are certainly industry leaders in specific segments of the consulting market (i.e. a dominant firm in a region, a firm that has a great deal of experience with one particular sector [e.g. Booz Allen Hamilton and Wargaming]), there will usually be some competition between firms for specific projects.

While a big chunk of projects are sold on the grounds of a partner leveraging his or her network of connections, or sold on top of a prior successfully conducted case (i.e. LEK selling a European customer service center overhaul project after successfully helping the company cut costs in its Asian call centers), there is still ample room for consulting firms to engage in what is called a “bake-off“.

It sounds like some crazy hybrid between a bake sale and a dancing contest, but what it actually involves is the major competitors for a specific consulting project making presentations about why they’re the best for the job (so definitely more like a dance-off than a bake sale). In doing so, the various firms attempt to leverage:

• Their brand strength/prestige (i.e. heavily relied upon by top players Bain, BCG, and McKinsey)
• Their unique competitive strengths (i.e. specialty practice areas)
• The experience and credentials of the relevant partners and team managers/leaders (i.e. resumes and biographical sketches get passed around)
• History/Background (i.e. “we have done 50 cases on that just this past year, and we’ve always been right!”)
• Overall firm strategy (i.e. “we create a strong working relationship with the senior management”, “we are dedicated to solving your problem!”)
• Innovative thinking (i.e. “we’ll present some cool slides showing how we think ‘out-of-the-box’”)
• Cost (self-explanatory and shouldn’t even warrant this parenthetical)

The deciding factor is usually not cost except when a large, experienced player attempts to break into a market or gain a foothold into a potential flagship client (i.e. a new BCG or Bain office breaking into McKinsey territory will “typically” charge lower fees), but usually revolves around the experience/credentials of the people involved and the background of the firm in that particular area. This is not surprising given that most of the other factors do not help in differentiating companies (who isn’t going to at least pretend like they’ll create a strong working relationship with senior management).

In addition to these factors, many unspoken (and undesirable) considerations go into the decision as well. Bake-off presentations involve more than just advertising the firm’s credentials, they also involve partner’s attempting to make personal connections with the executive team — oftentimes by acting subtly as “yes-men” for an executive’s pet project. I’m not aware if any consulting firm participated in the train wreck which was the AOL-Time Warner merger, but if there was one, one quick-and-easy way to win the bake-off was probably to subtly suggest to AOL that buying Time Warner is an “interesting prospect worthy of additional work” (or something equally wrong and equally flattering).

So that’s what partners do. . .

Capitalism is Alive and Well in China

This is either a sign that capitalism has fully been entrenched in China, or the sign of the coming apocalypse, but, Hooter’s has Moved to China (Hat tip to A. Phan). With more from that groundbreaking story, we have ABC reporter Rebecca Lee. Rebecca?

Although Hooters Beijing is the Alabama-based restaurant’s fourth branch in China, this opening is making waves. It was one thing when the first Hooters opened in the more cosmopolitan Shanghai in 2004, but in conservative Beijing, the “Hooters Makes You Happy” mentality feels a little more out of place.

Regardless of its exotic location, walking in to Hooters Beijing feels exactly like walking into any other Hooters location. With the same wooden tables, orange hot pants on the waitresses and that same smell of fried wings wafting through the air, Hooters Beijing could easily be found in America’s heartland.

I don’t know what makes me more surprised (disturbed?), that Hooters was already in China, or that it feels just like “America’s heartland”. But, if Beijing is more conservative, how is it that Hooter’s happened to make it there. Well, correct me if I’m wrong, but I don’t recall a Chinese character for “hooters”…

Like with any cross-cultural trend, some things get lost in translation, including the name’s reference to the female anatomy.

In Beijing, “Hooters” simply means “owl,” but that doesn’t mean the point goes overlooked.

And the best line in the article,

With the Olympics just around the corner, Hooters executives are also hoping to attract foreigners visiting this ancient city who may miss a taste of home.

I would like to meet the people who consider Hooters “a taste of home” . . .

Grad School?

That’s what Monday, September 17′s issue of PhD comics asks:        

Fire!

I was driving home with C. Yu, A. Agrawal, and J. Rosario after lunch today, and from the highway we see in the distance a big cloud of smoke — probably one signifying a fire. I nonchalantly cracked a joke, “Oh crap, guys, my house is on fire!” We all laughed.

Little did I know those words would come back and haunt me…

As we drove closer to my home (we were actually intending to go to C. Yu’s house and we just happened to be driving closer), I realized that the fire was nearby, and in fact, it was very nearby. Arriving at my house, I found cars parked every which way as spectators came to watch the fire. Running into my house, I saw my mother frantically packing things, and my father in the backyard with our garden hose attempting to soak the surrounding area (I live on a hill surrounded by dried grass — which, naturally, catches on fire). I was a little alarmed at this, but took it in stride and tried to assess the situation. Looking down the hill, I saw firefighters extinguishing the flames (one hapless owner saw the flames approach to within 3-4 feet of his backyard), and felt things must be under control.

That sentiment vanished when I looked down the side of the hill closer to my backyard — there, no less than 20-30 feet from my house were roaring flames. I raced into my neighbor’s home to get backup — they weren’t home, so I broke into their backyard, and took their hose and immediately started drenching the area around both our homes with water in the hopes that it would at least slow the nearby flame enough (if the flame got any closer) such that the fire fighters could work their way to our home.

Thankfully, the firefighters arrived before things got too hot (yes, bad joke, but I’m trying to make what could have been a horrible scenario into something light); at the end, the fire was stopped ~20 feet away from my backyard.

Luckily, no serious property damage or injury happened for me, my family, or any of my neighbors and local property owners. But, a very harrowing experience indeed.

And of course, here’s a picture of me laughing in the face of danger as I use my neighbor’s hose to stem the evil flames. (Yes, that’s right, Consultant by profession, Lucky-wannabe-firefighter by happenstance)

A Business Way to Look at "the Surge"

If you were to ask a Democrat about the success of President Bush’s “surge” in US troops, (s)he’d (probably) tell you the Surge is a failure. If you ask a Republican, (s)he’ll (probably) tell you the Surge has made progress. Both sides can cite valid statistics which seem to tell contradictory messages. Yes, civilian casualties are down without an enormous increase in soldier death, and yes, some progress has been made in training and in other areas. But, at the same time, there seems to be no significant improvement in the prospect that the violence will one day end, nor does there seem to be much improvement in the prospect that the Iraqi government will soon be able to take over the security and finances of the country.

How do you determine which side is right?

First, you have to ask yourself what constitutes success. As I mentioned before, one of the primary problems with the War on Terror and the War in Iraq is a lack of clear goals and clear means to measure one’s achievement towards those goals. But, lets just say (since this seems to be the general consensus I’ve seen in the media) that the end goal of the War in Iraq is a stable Iraqi government. If one exists, then the War was a success. If one doesn’t, then the War was a failure. Therefore, the Surge is a success if it contributes towards establishing a stable Iraqi government, and the surge is a failure if it is not contributing (and a particularly bad failure if it is making it less likely) to that goal.

So, is the Surge a success? How do you find out?

You could ask the politicians to debate, or you could ask a political expert/pundit – but, generally, pundits and politicians seem more interested in sounding right rather than being right (the same could apply in a business setting to executives and their pet-projects as well). While the truth may come out from such an exchange, this seems to be a risky and protracted (and quite sound-byte-y and un-informative, if most live-TV political debates are any indication) means to find the answer to a simple question.

But, there is an easier, and quite possibly, much more accurate way to find an answer. Every government running a deficit issues public debt, usually in the form of government bonds. These bonds, for those who don’t know, pay an interest rate to whoever is willing to loan the government money. The Iraqi government is almost certainly deep in debt at this moment. Now, the way the market works, a bond has to pay interest based on how risky the bond is. The reason is obvious, would you lend to a company that you knew would probably default? No. Would you lend if they were willing to pay you interest equal to half the loan? You would at least think about that prospect.

Now after a bond is sold, the interest rate is (for simplification purposes) set in stone. If the payor of the bond suddenly seems much less likely to pay off the loan, the value of the bond drops (because the interest rate isn’t going to move, who wants to hold onto a bond that pays the same but is a lot less likely to pay out?). If the payor of the bond suddenly seems more likely, the value of the bond increases (more people would love to get their hands on that bond). So, the point of what seems like a long digression is the price of a bond gives you an idea of how likely the company/government will not be able to honor its debts.

So, to answer the original question, how do you tell if the Surge was a success or a failure? The answer is simple: check the price of Iraqi government bonds before the Surge and after. If the price drops, the Surge is more likely a failure. If the price goes up, the Surge is more likely a success.

Why is this true? Why must bond values reflect likelihood of default? It’s because people want to make money. Yes, they may be Republican or Democrat, but if a bond is worth more than it should, then someone is going to sell, because there’s no point in holding onto an overvalued bond. And if a bond is worth less than it should, then people are going to buy (and bid up its price) — and you can count on this aggregate group of investors doing their best and spending their time and effort on figuring out the right answer.

And this is precisely what a paper by Michael Greenstone seeks to do. From the abstract:

“This paper shows how data from world financial markets can be used to shed light on the central question of whether the Surge has increased or diminished the prospect of today’s Iraq surviving into the future. In particular, I examine the price of Iraqi state bonds, which the Iraqi government is currently servicing, on world financial markets. After the Surge, there is a sharp decline in the price of those bonds, relative to alternative bonds. The decline signaled a 40% increase in the market’s expectation that Iraq will default. This finding suggests that to date the Surge is failing to pave the way toward a stable Iraq and may in fact be undermining it.”

This is the essence behind prediction markets, which use human greed coupled with human knowledge and reasoning to aggregate the collective wisdom of many people. This isn’t to say that these markets are necessarily correct (the market is not always efficient after all) or that they can pinpoint exactly what will happen (the answer above gives only a risk assessment after all), but this is about as unbiased (and if a large enough number of people are aware of and participating in the market) and accurate a method as any to figuring this out.

Note: I’ve only skimmed the section of the paper that describes the market valuation segment — I have a couple of issues with the paper’s methodology, and lack the patience and the talent to gauge the impact of adjustments to the method to the final answer, but suffice to say I think the method used to explore this problem is very cool