Archive for October, 2008

Interesting times are not for everyone

October 23, 2008

We live in interesting times. The whole world’s financial system and the ’science’ of economics are being re-written, major players in the market are disappearing overnight, it’s madness. Surely this is exciting? Well, guess what. It’s not.

Not doing new deals and sitting the whole day in the office is no fun. I am running out of interesting people to go to lunch with, but it doesn’t matter because it’s always the same conversation with everyone. Even the clients are now beginning to understand that maybe something is going on and have stopped requesting meetings to introduce the next greatest project. News sites cannot provide half the entertainment value of an over-enthusiastic real estate developer, it seems. Hell, I am not even going to get fired, at least this year.

What is worse, it is not just me. Speaking with financial people all over Europe, I get the feeling they are bored to death as well. They just pretend to be scared and excited. They also follow the same pattern of lunch meetings and reading the news. Probably a certain elite minority in the major financial centers are going for days without sleep and brainstorming clever solutions to the world’s problems, but we on the fringes are not so (un)lucky.

So this is how history gets written. A long period of deadly boredom occasionally interrupted by fits of panic. Great. I can’t wait for the uninteresting times to return.

To all of you essay writers – get Q10

October 16, 2008

I just finished the first draft of one of the INSEAD essays, in 10 minutes, between meetings. It is too early to be writing essays of course, I am going to apply for the Jan 2010 intake, but the temptation of Q10 was too much.

Yes, it is that great. If you have essays to write, you need this program or something similar. Notepad is good, but not this flexible. Word can be tweaked to look more writer-friendly, but only so much. So, click on that link already!

Interesting times ahead

October 13, 2008

B-School applications are counter-cyclical. When the economy is slowing, opportunity cost of an MBA goes down and people prefer to go back to school to weather the storm. Or so it was supposed to be.

For applicants in developing countries, applications are in fact pro-cyclical. In a good economic climate at home, more people can afford the cost of an MBA. In a good climate in the developed world, student loans are easier to get. In a global economic crisis, things are looking grim. Few would quit their job over an adventure that might leave them not only unemployed, but under a mountain of debt as well. This is assuming that there is a lender willing to provide said mountain.

Now, some interesting questions arise. Top schools, especially ones with an international image such as INSEAD, make a point of selecting applicants with diverse backgrounds. If the crisis continues and application volume from developing countries dries up, what happens with the diversity policy?

Developing countries aside, let’s look at the civilised world. What if, instead of just slowing, the economy melts down, or is expected to do so? Surely, there is a breaking point beyond which things are so bad that potential MBAs prefer to wait until the economy starts picking up?

Next year will be tough not only for us applicants. B-schools will need to think about their commitment to diversity (and its cost) and about the career prospects of their graduates. As a result of all that thinking, I would love to see more and larger scholarships. A decrease in tuition fees would be wonderful, but that only happens in Barbie world. One thing is certain; next year will not be boring.

Edit (Oct 14): this excellent post by TinyDancer is a must read.

P.S. Some links:
http://gmatclub.com/forum/108-t64549
http://gmatclub.com/forum/103-t71487
http://omnemba.blogspot.com/2008/10/tough-decisions.html
http://missionmba.wordpress.com/2008/10/06/darden-too-out-of-my-list/
http://musings360.blogspot.com/2008/10/citiassist-out-so-is-duke-for-me.html
http://trystwithmba.wordpress.com/2008/10/12/who-will-pay-my-fees-aka-no-loan-no-mba/

Meetings – the practical alternative to school research

October 10, 2008

I just had a chilling conversation with my ex-boss (and future recommender) who has banker friends in London. Thousands of smart and experienced finance people without jobs, some of them willing to work for free just so that they don’t have a gap in their resume. Wow.

Another person I met was a guy from IMD. He basically confirmed the horror stories I had already heard and added some. There were times when he did not sleep for days, and went to class with an alarm clock, so that he could sleep on the floor during breaks. Again, wow. As to the people there, IMD is the HBS of Europe – the students and faculty are confident to the point of arrogance, workaholics, many of them rich, many of them military. They are constantly told that they are exceptional and better than everyone else, and they start believing it. Still, the person I met was cool and helpful and claims that IMD is a good experience, career-wise. The school is definitely focused on industry and general management, but that is a good thing in the current climate.

I spoke briefly with an INSEAD alumnus as well. She also confirmed one of the popular stereotypes for her school – that it is also a lot of fun, not just hard work. The students are constantly organising parties, trips and what have you. There is apparently a huge network of alumni, whom one can contact and ask for help or advice. She definitely did not agree with the “INSEAD is for consultants” stereotype and insisted that the school is large and good enough to be able to launch all kinds of careers.

Definitely I need to talk to more people and do more research, but so far two conclusions are evident: first, LBS, INSEAD and IMD comprise the entire top tier in Europe and second, LBS is not my school because it is too expensive and soon to be flooded with desperate ex-bankers. Yes, the other schools will be flooded with those types too, but this is combined with the already unbearable costs and longer duration. Regarding IMD, I am having doubts whether it is the right school for me, but since there are only two top choices left I cannot afford not to apply there.

The next step is to meet more interesting people from the target schools, including this guy I know who graduated in St.Gallen. Maybe it would be a good idea to visit Fontainebleau and Lausanne. Yes, I am bored and want to travel. Besides, there’s plenty of time till essays are due in Feb/March, right?

Got the official report…

October 6, 2008

… and AWA is 5.0. What a relief. I was dreading something much worse after the disastrous second essay.

In other news, I am still investigating IMD and INSEAD, and meeting some interesting people in the process. So far it looks that this whole business school application thing will be much longer and tedious than expected. And there I was thinking that once the GMAT is done I can live a normal life again. Ha.

Full GMAT debrief and random advice

October 1, 2008

Here is the full GMAT debrief, complete with random advice and observations.

Background

I am a financial guy, but definitely not a quant jock. Before the GMAT entered my life, my idea of doing quantitative work was opening an Excel file with calculations prepared by someone else. Learning (or rather, re-learning) how to add, multiply and subtract (dare I say divide!) without Excel/calculator, was the hardest part of the preparation and the one major source of wrong answers on the practice tests. Even now I cannot claim to have mastered this arcane art. Verbal on the other hand seemed easy – I have always been a quick reader, even in English, which is not my native language. This is the part where the nerd background helps. With the exception of some obscure grammar rules, sentence correction felt natural, too.

I started buying books and access to websites sometime in June, and in July the real preparation started. There is not much to tell here, because everything that happened since July has been duly recorded in this blog.

Test Day Preparation

The day before the test I browsed through some AWA templates before noon and then tried to calm down – went to the gym, did a very, very light workout with sauna and massage afterwards, watched a movie.
On test day, the plan was to sleep until 10:30 – 11 AM, but that didn’t happen. I got all nervous before 9 AM and could not get back to sleep at all. The GMAT appointment was for 1:30 PM, so I had lots of time to get to the test centre, explore the neighbourhood, wash my car, eat lunch, drink coffee. I arrived at the test centre still a bit nervous. Got my fingerprint and picture taken, then freaked out when they wanted me to reproduce the same signature that is on my ID card. (the card is like ten years old, I don’t have the same handwriting style anymore, nor do I write with the same hand). Somehow I got through this and started the AWA.

AWA

The first essay went well, although I was painfully aware I was writing pure BS. Nevertheless, it was logical, organised, grammatically correct BS. The second essay got me though. It was a broadly formulated, vaguely political/philosophical topic and I was definitely not in the mood for tackling such heavy issues. The time went on, so I started typing stupid stuff organised into paragraphs until the stupid stuff was about 350 words or so and left it at that. The result was an awkward, embarrassing abomination of an essay that is best forgotten; I hope INSEAD won’t read this too carefully.

Quant

I was rather shaken by that second essay and started to panic slightly. The whole quant section is now a blur in my head, 75 minutes felt like 5. I could not tell whether it was going good or bad. I remember some insanely difficult questions, as well as some easy ones. One good thing though – my timing was tight and I managed to finish about 2 minutes before the time was up. Hard work does pay after all. As to question content, number properties galore, some coordinate geometry, some plain old geometry, mixtures, sets, only one combinatorics question, no probabilities. This supports my theory that learning combinatorics/probability is useless, unless you are shooting for 50-51 in quant.

Verbal

The Verbal section felt pretty comfortable all the way through. I took my time, never had to hurry or guess an answer, and finished the section with 8-10 minutes to spare. Contrary to other people’s experience, the hardest questions were sentence correction. I had to really think on most of the SCs, especially after the 20th question. On the other hand, CR and RC did not present anything more difficult than OG11 or the OGVerbal guide. In most of the critical reasoning questions I actually saw where the test was trying to trick me, besides there was enough time to check all five answers. Reading comprehension was OK – got one social science/minorities passage, one hardcore science passage, the rest I don’t remember. I am not able to give meaningful advice on RC, because I’ve always thought the science passages were interesting and the social science ones boring but easy. In summary, my quick reading skills gave me time to carefully consider each tricky question, be it SC, RC or CR.

Prep Materials Used

  • Official Guide 11th edition (the OG)
  • Official Guide Verbal and Quantitative
  • GMATPrep – each test three times
  • Kaplan CATs (did not use the book)
  • MGMAT Cats (just the online tests, did not buy any of their ‘bibles’)
  • GMATClub Forum – excellent for solving random problems while at work

I had a ton of books/tests/guides available that I did not use: Kaplan 800, Barron’s, 800score.com (though I browsed through their guide and it was helpful), McGraw Hill.

Practice Test Scores – in chronological order

GMATPrep 1 740 49 42
GMATPrep 2 770 49 48
MGMAT CAT 1 700 44 41
GMATPrep 1 750 47 46
MGMAT CAT 2 700 44 41
Kaplan CAT 1 630 37 38
Kaplan CAT 2 580 36 35
MGMAT CAT 3 710 42 45
MGMAT CAT 4 730 48 41
Kaplan CAT 3 640 38 39
Kaplan CAT 4 640 39 38
MGMAT CAT 5 770 50 45
MGMAT CAT 6 750 48 45
GMATPrep 2 780 49 50
GMATPrep 1 760 50 45
GMATPrep 2 780 50 48

If you use the MGMAT CATs and get great results, bear in mind that it begins to run out of 700-800 level questions by the fifth, or fourth test. This means that in the sixth test you never get to see a high difficulty question, thus inflating the score. Kaplan does that, too, and warns you explicitly with a dialog box before the fourth test.

Preparation for Quantitative

Number theory is extremely important for the Quantitative section. Not only are there many questions in that area, but also better knowledge of number properties will help with most other types of questions. Remember, you cannot use a calculator on the GMAT – so if you know how to ‘dissect’ an integer into prime factors it will make all sorts of calculations easier. Finally, number theory questions are by far the hardest type of problem – my practice tests showed that they are my weakest spot, despite the fact that I concentrated mostly on them.

Combinatorics is overrated. I have the feeling that MGMAT, for example, has much more complex and weird combinatorics problems that the real test, making test takers learn unnecessary theory. Just take a look at such questions in the OG11 and GMATPrep. The ones from the official prep materials are still tough, but somehow smart, meaning that one can solve them with minimum knowledge of formulas and quickly at that. Mastering combinatorics (and probability) is only needed if you are shooting for Q50 – 51, in my humble opinion.

The rest – coordinate geometry, rate/time/distance/work problems, mixtures, overlapping sets, algebra – can be mastered quite quickly, unlike number theory and combinatorics.

Preparation for Verbal

In Verbal, focusing only on sentence correction is bad. Don’t do it. This section tests quite different abilities from the ones tested by the Quant one. Therefore, different type of preparation is needed. What I did was the following – I practised Verbal questions always after work, or after completing a whole Quant section, and almost always with a timer. In other words, I made a point to practice this section when exhausted and under stress. Anyone can master CR and RC in a comfortable setting and with plenty of time, but the real test does not give you this luxury.

Random Advice

  • An excellent verbal section is better than an excellent quant section, at least in terms of overall score in GMAT. Apparently this is because excellent quant results are much more common. So, don’t forget Verbal and definitely do not concentrate only on SC, as many people seem to be doing. The OG 11th edition, the OG Verbal guides, and GMATPrep are the only prep materials I can recommend there. Note: I cannot comment on MGMAT’s SC bible, or the frequently mentioned ‘CR Bible’.
  • It doesn’t matter much whether English is your native language or not. The Verbal section deals with a lot more than pure language ability.
  • Every preparation book/website/CAT is good for quant, as long as it makes you practice the same basic principles as the real test does. This is not the same for Verbal, however. If the verbal questions do not have the same ‘feel’ as the official ones, you’re wasting your time. My advice – try to solve any math problem in sight, but be picky with the verbal practice. About a week before the test, practice from the OG only.
  • Try to take AWA seriously and prepare for it – this will boost your confidence for the Quantitative section. In other words, do as I say, not as I do.
  • Kaplan is actually good for quant. I’d go out on a limb here and venture that Kaplan has questions that are closer to the real thing than MGMAT. Just don’t trust their scoring on the CAT’s.