I confess - I thought I knew a lot about business. As a commercial lawyer with experience in transactions like M&As and project financing, as well as disputes involving vast sums of money, I felt I understood the "binary code" of business - the contractual mechanism and rules-of-play that seal or sever any commercial relationship.
Surely law was the key component in business, the gateway through which all activity needed to be funnelled if any outcome was to be achieved?
This is why I am grateful I signed up for the HBX CORe program in July 2015, which quickly put me right. The coursework filled in knowledge gaps in areas where I knew I was weak, but also greatly enhanced my understanding of concepts and topics I'd previously felt confident in.
While my legal education put an emphasis on the "how" of business, like how a company takes over another, how a regulator applies a rule or how a plaintiff enforces a right, etc., CORe taught me the "why;" the intuitions that underly any commercial decision before legal ink even hits paper.
And CORe did this by doing exactly what it says, by focusing on the fundamentals. In doing so, it not only gave me new understandings of business but new perspectives on law itself.
The fundamentals of business
I confess, I first expected Economics for Managers to involve bone dry theories and memorization of abstract curves. CORe quickly put those worries to rest. Harvard Business School’s signature case method brought real-world fidelity to each concept, putting us in the shoes of actual managers who struggle with them. One memorable case study demonstrated how a little device called the Kindle could transform an entire industry because of its impact on incumbents’ fixed and variable costs. This overturned my preconceptions on how companies think about and respond to competition, and showed to my surprise that disruptions could be opportunities as much as threats.
Then the revelations crept closer to home. I learned how regulation, that lawyerly domain, is what economists call a market “friction” that companies can exploit in maintaining a competitive advantage over competitors. I also discovered how the spirit of a law like anti-gouging, designed to ensure greater fairness, could produce opposite and sometimes worse outcomes in reality if it ignored basic economics. Law was not necessarily the determinant factor in a company’s considerations, but one of many.
Assets, Liabilities, Equity, Revenue and Expenses. I encounter these fundamental terms daily and, because I advised on legal “liabilities”, or “equity” financings, felt I understood them. Financial Accounting taught me their precise meanings and how they relate to and interact with each other. In the end I saw how financial accounting truly is the “language of business”, fluency in which enables you to gain insights into the present and future performance of any company, regardless of the seeming complexity of its accounts. This is empowerment in the truest sense as accounting principles apply everywhere, whether to your neighborhood corner store or Apple, Inc.
Finally, Business Analytics demystified “big data” and the tools companies use to contextualize information, challenge shibboleths and execute learnings for maximum results. Case again provided its vivid tapestry in demonstrating how everything from Amazon adding a single word on its homepage to Disney deciding a major home entertainment release is driven by data analysis. Most surprisingly, the daunting names of these analytic tools like “hypothesis testing” and “multiple regression” belie remarkably simple fundamentals which trace back to high school mathematics.
As an ex public prosecutor, I discovered that a trial is essentially a hypothesis test. The burden of proof (“reasonable doubt” in criminal cases) is the confidence interval of this test, which if decreased makes a false positive (a mistaken guilty verdict) more likely but if increased makes a false negative (mistaken not-guilty verdict) more likely. The same logic used in a court of law applies equally in the decision making of the world’s most successful companies.
Each time I sat down with CORe I encountered “Aha!” moments like these which showed me how much I had yet to learn about the world of business. Simultaneously, I was humbled by new insights into the role law plays within this world.
Want to hone your business skills to help you advance in your career and feel more confident contributing to conversations about finance, economics, and business analytics?