By Louise Story March 4, 2013
The former accountant from Arthur Andersen sat next to the former analyst from Enron in our assigned seating during my first year of business school.
I sat two rows up. I was the sole aspiring journalist and a bit of an odd duck pursuing an M.B.A. More than a few of my professors and fellow students asked me a bit incredulously – are you really going into journalism? In fact, more than a few journalists back then asked me the same thing.
The answer was, yes. I attended business school precisely because I planned to pursue a reporting career. In many stories, following the money is the best plan of attack.
Here are the things that I’m most glad I picked up in business school:
Accounting, Statistics, Excel – if those sound like dirty words to you, you might consider forcing yourself to learn them. The basic concepts of accounting – flows versus stocks, for instance – come up not only for business reporters, but for political reporters looking at budgets and foreign reporters examining international aid. Or take “a dollar today is worth more than a dollar tomorrow.” I can’t tell you how many times I’ve heard people botch that one, but it is a basic financial rule known as the time value of money and it’s critical for reporters sizing up a company’s worth. As for Excel, if you gain confidence with it, as B-school forces you to, then functions like pivot tables and filters will become your secret weapon in journalism, helping you spot stories that other people miss.
In 2009, I wondered if bank pay would be going up or down after the financial crisis. I couldn’t look at total compensation at the banks because some had larger workforces than others. I had to look at compensation per employee. So into the bank financial statements I went. I designed a basic Excel spreadsheet and hours later, the result was in: bank pay was going up. Ditto on stock market volatility. Lots of traders were saying 2011 was more volatile, but they were speaking anecdotally. So I plugged the year’s stock closing pricing data into Excel, and soon, I had an answer. Last year, I wondered how much states give companies in tax credits and other subsidies. Once again, a little numeric literacy came in handy. In all these cases, I was able to give readers answers that didn’t exist without my analyses.
Another core of most M.B.A. curriculums is strategy. That class involves learning rules of logic and thinking ahead to predict others’ actions. It’s common-sense stuff, but studying it is immensely helpful in thinking ahead about how a story is likely to evolve.
More broadly, studying business history proved helpful to me as I started covering it. Part of anticipating what might happen is knowing a bit about the past. I took a class on the history of bank regulation, another on financial fraud at companies like WorldCom and multiple economics classes.
When I was asked to help out on a quick turnaround story about the recall of Thomas the Train toys in 2007, I remembered reading about the Tylenol recall in the 1980s. It was a classic example of a corporate crisis that I could reference. I had a similar leg up when delving into what went wrong in the financial crisis. Knowing the alphabet soup of bank regulators and how laws like the Glass-Steagall Act had changed what banks were allowed to do was critical during the financial crisis. And there’s no substitute for understanding how interest rates work, especially during a housing bubble and thereafter.
In journalism, most reporters get to spend their days focusing on their stories and do not have to worry much about the business side of what they do. This makes journalism unique from almost any other sort of industry. Over time, though, reporters become editors, and a big part of that job is to manage people and strategize on how to attract more readers. I am not sure I ever want to be an editor, but if you do, you might be glad to have studied management. And as our industry tries to find new paths forward, I think understanding marketing will be helpful to me even as a writer. So often, we have to market our journalism to get people to read it.
All that said, an M.B.A. in no way replaces bootstrap reporting experience. And many of the things you learn in business school are things you could pick up over time writing on business. Still, my background equipped me to jump in cold on the Wall Street beat just as the financial crisis of 2008 was heating up. When Lehman Brothers, Merrill Lynch, Citigroup and many others hit trouble, I was glad to be well prepared.
Louise Story, a reporter on the Investigations Desk at The New York Times, graduated from Columbia University’s Graduate School of Journalism in 2005 and Yale University’s School of Management in 2006.
This entry was posted on Monday, March 4th, 2013 at 10:11 pm. It is filed under Skills and Tradecraft and tagged with business school, compensation, Excel, MBA, statistics, The New York Times, volatility. You can follow any responses to this entry through the RSS 2.0 feed.
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