Repost: Jeff Schmitt of Poets and Quants, "Goofiest Terms You Learn in Business School"
About two weeks ago (mid-June), an IRGC missile landed about 300 meters from my Tel Aviv apartment. It did a number on my building. I’ve been staying in a hotel since. The apartment is salvageable. The roof and walls are already fixed. But I took a break for my mental health and spent my last few sheks on a Nintendo Switch 2. Now I’m easing back into job hunting, startup development, and, of course, writing blog posts here and on my Jew-focused sub-blog, Jude.
I drafted a post a year ago about the general nonsense of MBAs, including my own experience. While looking up MBA puns (to avoid plagiarizing any not-so-witty titles), I stumbled onto a site that deserves a preamble of its own. This post is basically the warm-up, a little mood-setter before I get into the real roast.
Having worked at a bunch of companies, I can tell you this business school stuff gets out of hand. It turns regular work into some weird frat/srat culture. It’s the cool kids’ table energy that us nerds laughed about from the geek table. Sure, sometimes the terms are useful. I get why one of my projects clung to “PLG” to mean “Product Led Growth.” But other times it’s just layering fluff to make things sound important. My recent nightmare went like, “We are going to create a TKE for this user-based issue.” Cue this w/ Bob & David (Mr. Show) clip and you’ll get the vibe.
Don’t even get me started on “Tier 1.” Sometimes it means highest severity. Sometimes lowest. Depends on the mood of the company. Don’t dare ask for clarification. They will insist their definition is standard. Of course it is. ‘Yep, everyone uses your 0-4 scale for severity, then inverts it for tiers, then ultimately pushes it off to R&D because your CS and Support Team are not qualified to really help.’
Poets & Quants, a site I found during my pun-quest, describes itself as “highly creative stories on the things that matter most to the graduate business education market...” They publish critiques, long-form pieces, and apparently, also satire. I’ll be keeping an eye on them. Love a website that screams, “We have a ton of money, but we aren’t going to spend it on cosmetic fixes.”
The article I’m referencing is from way back in 2019, which feels like another lifetime thanks to COVID and literally 100+ wars since then, three of which greatly impacted me. I don’t know the author and didn’t ask for permission to repost it. You can read it directly here (https://poetsandquants.com/2019/05/14/goofiest-terms-you-learn-in-business-school/ ) .
Disclaimer: I am not copying images of the random students featured in this article. If they want the article removed, or adjusted, they can let me know.
WTF is this stock image they used???
Goofiest Terms You Learn in Business School
Jeff Schmitt on May 14, 2019
Finance is often described as the “language of business.” In many MBA classes, you’ll find a strange dialectic being spoken, a crazed concoction of acronyms, buzzwords, and metaphors. Some call it “MBA-speak” – a robust set of synergies that enable students to gain traction, build bandwidth, and leverage their learning.
In a nutshell, MBAs drill down and peel the onion so they can close a loop end-to-end. This requires them to formulate a scope and weigh the optics from a 30,000-foot view. To do this, MBAs are trained to ramp up the scale of their turnkey solution so they can monetize the next stage across the value chain … delivering a win-win ROI across the triple bottom line.
Is it any wonder that some people think MBA stands for “Masters in Buzzword Accumulation” (when the term isn’t being twisted into “Mediocre But Arrogant,” “Manager By Accident,” “More Bad Advice,” or “Me Before Anyone”)?
COMMUNICATE OR OBFUSCATE?
For the University of Missouri’s Orvil Savery, a 2019 Best & Brightest MBA, such clichés create a “secret club,” replete with a “secret language and a blazer.” If anything, he says, MBA-speak serves an essential purpose. “You haven’t truly become initiated until you can walk into a room or give a presentation and say something like “It depends” for literally every answer without anyone looking confused,” Savery jokes. “You might not fully have the answer but at least you’ve bought yourself some crucial minutes to come up with a solution.”
Admittedly, notes the London Business School’s Allie Fleder, MBA-speak can be wielded as a weapon against those “not in the know.” However, the language is increasingly sparking a backlash among students – with cutesy models heading the list of complaints for the University of North Carolina’s Svitlana Niskoklon.
A LIST OF MBAs’ FAVORITE B-SCHOOL TERMS
“Acronyms that drive me crazy are 3Cs or 5Ps models,” she says. “Did you know that 5Ps stands for “product-price-promotion-place-people” for marketers, “plan-ploy-pattern-perspective-position” for strategists and “planning-process-people-pricing-partnerships” for entrepreneurs? Same story with 3Cs. Please, tell business people who create those models that there are 24 other letters in the English alphabet. Stop overusing P and C.”
Alas, P&C itself can stand for “property and casualty” or “personal and commercial” in business school too. Despite being dense and overlapping, MBA-speak conveys some real truths – often tongue-in-cheek – about MBA life. Ever hear of the Turkey Drop? It’s seemingly an annual ritual, usually around Thanksgiving, where a first-year MBA will dump a long-term or long-distance beau. How about the Circle of Death? At networking events, eager MBAs form a circle around recruiters, each vying to make an impression. Of course, everyone knows FOMO – Fear of Missing Out – an impulse that leaves thousands overcommitted and overwhelmed every year.
What are some of the most critical terms in the business school lexicon? This year, Poets&Quants asked our Best & Brightest MBAs and MBAs To Watch to share the “goofiest MBA term or acronym” they encountered…along with its meaning. Looking to get a head start on business school – or in need of a good laugh? From the Big Mac Index to the HIPPO Effect to the Relationship IPO, here are 30 MBA terms that left the biggest impression on the Class of 2019.
BATNA: It stands for the Best Alternative to a Negotiated Agreement. If you don’t know your BATNA, you don’t know anything. Andrea Caralis, Carnegie Mellon (Tepper)
BHAG: Big Hairy Ass Goals – Set them and set them often. I remember celebrating receiving my full-time offer with my career coach, who gave me a hug and then immediately asked me what my next BHAG would be (after mere minutes of feeling the high of a job offer). Setting goals is important, achieving them is rewarding, and then setting the bar to a higher level is what helps us to continue to grow. Jennifer Solomon, Indiana University (Kelley)
Big Mac Index: This compares the price of a McDonald’s Big Mac burger across countries; it essentially serves to measure a currency’s relative purchasing power. Before business school, I never knew that fast food could tell us so much about foreign exchange rates. Franklyn Darnis, University of Virginia (Darden)
Blue Ocean vs. Red Oceans: I first listened to this in a Global Strategy class and I had no idea of what it meant. But basically, blue ocean strategy is when a company creates its own market space and make competitors irrelevant. Red Ocean can be explained as a really competitive market space, where companies fight to get customers. And yes, red is associated with blood. Barbara Chavier Mandarin, ESADE
It’s ironic that Blue Ocean Strategy represents uncharted market space, and Red Oceans represent common market space. In real life, most oceans are blue, and red oceans are very rare. Charlotte Pekosk, Notre Dame (Mendoza)
Circle of Death: Imagine you are at a networking reception and there is one representative from your dream company in your dream function. Now imagine there are 10 other people also interested in speaking to the same representative to form a connection and somehow you all end up in one large, growing circle. Everyone is awkwardly nodding and smiling at the same person while thinking of that one “home run” question. To make matters worse, no one knows how to politely exit. This is the infamous circle of death. Ashley Fox, University of Texas (McCombs)
CRAAP: When doing research for a memo, I stumbled across CRAAP (Currency, Relevance, Authority, Accuracy, and Purpose) and had to double-check that it was real. Michael Hilfiker, Wisconsin Business School
CRaP: In my summer internship, we frequently used the acronym CRaP. This stands for specific retail items that “Can’t realize any profit” and thus should be considered for potential removal from the Amazon retail channel program. CRaP was succinct, descriptive, and always good for a laugh. Caitlin Styres, Arizona State (W. P. Carey)
DBW: At Fuqua, we have a saying— DBW or “Don’t Be Weird.” The spirit of it is definitely sarcastic, but at the core it means “be yourself.” This advice is especially useful during recruiting when we get in our heads. It’s meant to remind each other to be our authentic selves. Ashley Brown, Duke University (Fuqua)
Efficient Frontier: When I first learned about the “Efficient Frontier” portfolio theory in our investor class – from what I remember, it represents an optimal set of portfolios that offers the highest expected return for a certain level of risk – I remember doodling a set of planets and aliens on my handout. It sounded like something from Star Trek! Jasmine Ako, Yale SOM
ELI5: Explain It Like I’m 5 (years old). Hilarious and so useful!! Thabo Lenneiye, Cambridge University (Judge)
Finance Troll: In the UF MBA program, we love to participate in case competitions. We have a rule of thumb that every successful team needs to have at least one strong finance troll to help crunch the numbers. It is a loving term of endearment for one of the most important members of a case competition team. Nicolas Ramos, University of Florida (Warrington)
FOMO: One that everyone knows is FOMO: Fear of Missing Out. It was crazy to see people booking airplane tickets after they discover that a bunch of colleagues is going to “this island” during the weekend. Online ticket prices surged 250% just because of the FOMO effect. People are so afraid of missing events and not following the crowd!! Francisco Lobato, INSEAD
GOOB: Get Out of the Building. It was in reference to the Lean Launch method of Entrepreneurship. Caitlin Dishon, Arizona State (W. P. Carey)
Herbie: In operations, we read The Goal. Herbie was the bottleneck in the process. My classmates use Herbie in all contexts. When we go hiking, the slowest person will refer to themselves as Herbie. Manasa Murthy, University of Texas (McCombs)
HIPPO Effect: I have taken a few classes with Professor Leonard Lane. He would always warn us of the perils of the “Hippo” effect. I came to learn that this was indeed the “HPPO” effect: Highest Paid Person’s Opinion effect. This is when the highest paid earner (the boss) often would make decisions based on personal experience and preference instead of data and analytics. Joy Mina, U.C.-Irvine
It Depends: In business, a lot of things are dependent on various conditions, so “it depends” is everyone’s favorite. It is encouraged to give a conditional answer as business decisions are dependent on various situations. However, I still struggle to use this term a lot as I am used to giving clear and direct answers. Avni Sabhani, University of Illinois (Gies)
JVs: At Kellogg, we call significant others “JVs” – short for “Joint Venture.” While the term has the advantage of being inclusive of all types of partnerships, it doesn’t quite resonate with people outside of the business world. My JV (who is in the medical field) thought it stood for Junior Varsity until last week! Megha Kosaraju, Northwestern University (Kellogg)
Leverage: One of the most overused words I have come across during my MBA days is “leverage.” It has been used relentlessly to describe how a situation can be controlled. I am amazed at how this phrase can be worked into almost any situation. Sree Madakkavil, University of Rochester (Simon)
LIFO and FIFO: LIFO (Last In, First Out) and FIFO (First In, First Out) are acronyms used in accounting for inventory. Although the goofiest thing about these acronyms are their pronunciation, I find them funny because they are somehow constantly relevant to my life. Every time I go grocery shopping, I think “I’m going to FIFO these groceries.” But every time I go into the fridge, I end up LIFO-ing these groceries. That’s how I end up with spoiled vegetables and expired kombuchas. Swati Patel, Rice University (Jones)
McBainCG: It’s always funny to label the big three consulting firms as “McBainCG.” A few of our professors use it to generalize McKinsey, Bain, and BCG and it always gets a smile. Vito Errico, Yale
Pay to Play: This term sounds like it should be used in a scene in The Godfather. “Pay to Play” actually means that in a subsequent round of financing the previous investors in a company are required to invest in the company to keep their pro rata share of the company or their preferred shares will be converted to common stock. Andrew Engram, U.C.-San Diego (Rady)
PIE and 4 Slices: I’ll pick on our strategy class, since they relied heavily on acronyms (e.g., GSCAL, DSIR, PARC, etc.). The one that most of us struggled with most was “PIE and 4 Slices.” Think of it as Stanford’s less popular and more confusing version of Porter’s 5 Forces. While it caused some eyes to roll, I’ll acknowledge that it differentiates itself by distinguishing between value creation (i.e., “potential industry earnings”) and value capture (i.e., buyer power, supplier power, rivalry threat of entry). Geoffrey Calder, Stanford GSB
Relationship IPO: The first time a business school couple posts a picture together on social media. Alyssa Murray, MIT
Three S’s: Sleep, Socialising, and Study. It’s the notion that you can’t have all three but need to prioritize the top two. Frankly, I think it’s possible to do all three if you only need 4 hours of sleep, go out twice a week at the most and study without procrastination. In fact, I think it’s missing the fourth: job hunting! Alissa Warne, IE Business School
TIGS: At some point during our first year, someone coined the acronym “TIGS” which stands for “This Is Grad School!” Whenever we were stressed out or someone was complaining about school work or the job search, someone would just say, “TIGS.” Steven Murchison, Georgia Tech (Scheller)
TL;DR: It might not be an MBA-specific term, but I had never heard of it before Tuck. I kept seeing it pop up in student e-mails, and so I finally researched the definition. It stands for “Too Long; Didn’t Read.” I was so confused because people would use it to summarize a point at the beginning of the e-mail…when no one has yet read the referenced content! SMH. I fell into the trap, though. I now use it too. Kayla Lorraine Demers, Dartmouth College (Tuck)
TOSCA: Of all the problem solving and strategy frameworks we were taught at HEC Paris, TOSCA wins. It’s a method to develop the core question or business problem. I don’t know who developed it, but it stands out because it brings all the drama of opera to the challenge. Using the plot and the name of the opera, it helps frame a problem. Trouble. Owner. Success Criteria. Constraints. Actors. TOSCA. Tricia Wilson, HEC Paris
Turkey Drop: Referring to relationships that break up around Thanksgiving of your first semester. Using this phrase trivializes the experience of a b-schooler in a relationship. As someone who came in to b-school in a relationship (and is still in that relationship!) it seemed like too casual of a term for how tough it is to be in a relationship while in b-school. I found that talking with my classmates who were also in relationships was a huge well of support and helped us get past this silly term. Jasmine Hagans, USC (Marshall)
UPOD: Under promise, over deliver. Hearing it spoken makes me think of those Pod storage units. Amie Pierone, Arizona State (W. P. Carey)
VUCA: Used to describe a business environment that is increasingly volatile, uncertain, complex, and ambiguous. Sure, the acronym makes sense, but also “VUCA” sounds like a contagious disease, no? Briana Saddler, Columbia Business School
WACC: Weighted Average Cost of Capital) – Every time I hear it, I just think of the “wiggity, wiggity, wiggity wack” line from “Jump” by Kris Kross. Shirley Liou, University of Washington (Foster)
ZOPA: This stands for the “Zone of Possible Agreement” in a negotiation. It describes the open field where two negotiating parties would be better off compared to if they didn’t have a deal. “Zopa” sounds like the capital city of a European country. Anish Bhatnagar, University of Chicago (Booth
