10 quirky business school terms every MBA student should know about!
It is true when people say an MBA degree can change the person you are. It changes your skills, the way you perceive the world, your priorities, and surprisingly, your lingo! Once you step into the world of a B-School, you find exposure to numerous acronyms and terms which radically change the way you speak. There are countless business school terms you learn which can help you successfully grasp the wonderful language of MBA.
Without a doubt, there are countless business school terms and acronyms that students come across. While some of them provide the fundamentals of MBA, others are quite amusing in nature! Check out the following list of some of the most quirky business school terms which can effectively guide you throughout your MBA journey.
BATNA is an acronym that is used as a common negotiation tactic, making it one of the most important business school terms. It stands for ‘Best Alternative To A Negotiated Agreement’ and is defined as the most advantageous alternative that a negotiating party can take if negotiations fail.
The acronym is coined by Roger Fisher and William Ury in their 1981 bestseller, ‘Getting to Yes: Negotiating Without Giving In’. It helps you understand the value of your best alternative by clarifying your reservations and underlining your negotiating power.
- Big Mac Index
Invented by The Economist in 1986 as a lighthearted guide to whether currencies are at their “correct” level, the Big Mac Index is one of the most popular business school terms used today. It is an informal way of measuring the purchasing power parity (PPP) between two currencies, thereby providing a test of the extent to which market exchange rates result in goods costing the same in different countries.
For those who aren’t aware, the Big Mac Index compares the price of a McDonald’s Big Mac burger across countries. It essentially serves to measure a currency’s relative purchasing power. Who knew fast food would give birth to one of the renowned business school terms!
- Blue Ocean vs Red Ocean
In their classic book ‘Blue Ocean Strategy’, Chan Kim & Renée Mauborgne coined the terms ’red ocean’ and ‘blue ocean’ to describe the market universe. Today, it has indisputably become one of the most crucial business school terms, which helps in providing strategies to help you gain an edge on your competition.
To briefly sum up the terms, the blue ocean strategy is when a company creates its own market space and makes competitors irrelevant. The red ocean on the other hand is a competitive market space, where companies fight to get customers. And yes, red is associated with blood!
No, this is not the name for some robot in a Disney movie. ELI-5 actually stands for, ‘Explain it Like I’m 5’, making it one of the goofiest business school terms you may have come across. As quirky as this term is, the logic it carries is quite helpful for any MBA student to quickly grasp complicated concepts.
The acronym comes from The Feynman Technique, which is based on legendary physicist, Richard Feynman, and his tips on being a quick learner. The idea is to break down difficult concepts into simple language, which even a child could easily follow. This forces you to gain a deeper understanding of the subject you’re studying, which ultimately helps you in forming a simple connection between complicated concepts.
- Finance Troll
Don’t worry, no one here is going to get trolled for this term! Finance Troll is surprisingly one of the most significant business school terms when it comes to participating in B-school competitions. It emphasises on the rule of thumb where 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. So if you’re planning to register for a competition, make sure you’ve got a Finance Troll on the team!
- The HiPPO Effect
As funny as the name sounds, the HiPPO Effect is one of the most useful business school terms to keep in mind while performing any task. The acronym stands for ‘Highest-Paid Person’s Opinion’, explaining the phenomenon of pleasing the senior-most person in the room while making decisions.
The HiPPO Effect acts as one of the most cautious business school terms, and eloquently reflects hierarchical group psychology behavior. The effect can take place within any group, be it at school or work. It highlights the issue of overlooking the content of any project, in order to please our superiors.
No, this is not a new item on the McDonald’s menu. Among several other business school terms, McBainCG is a clever way of amalgamating the big three consulting firms. The big three include Mckinsey, BCG, and Bain & Company. If you are interested in a career in the field of consulting, then get prepared to hear this term all the time!
- The Three S’s
Every student currently pursuing their MBA degree is aware of the hectic schedule they follow in order to survive. No matter how busy they are, such students always tend to miss out on one thing or another. The Three S’s is a term that very well depicts the compromising choices B-schoolers have to make during their journey.
The Three S’s are Sleep, Socialising, and Studying. In a precise manner, the term expresses the notion that no B-schooler can achieve all the Three S’s at the same time, pushing them two prioritise any two. If you wish to focus on your studies and socialise with peers during your MBA journey, then say goodbye to your precious sleep!
Other than the amusing manner the term TOSCA sits on your tongue, it surprisingly serves as one of the most principal business school terms when it comes to solving any problem. The acronym serves as a checklist when you need to frame your problems with clarity. It stands for, ‘Trouble-Owner-Success-Criteria-Constraints-Actors’. The method helps you effectively build the core question or business problem, in order to frame a comprehensive strategy.
For those of you who have read the book ‘The Goal’ by Eliyahu Goldratt, the term Herbie would be self-explanatory. The book is one of Amazon’s top sellers, and thoroughly explains the Theory of Constraints, making it a must-read for every MBA student. Herbie is described as a metaphorical bottleneck in any task, making this one of the most fundamental business school terms.
To understand the frequently used term, Goldratt tells us the story of Herbie through the protagonist of the novel, Alex Rogo. Herbie is the slowest kid on a hike in his Boy Scout troop. The troop must stay and reach the campground before sunset. The speed of the hike is wholly dependent on how fast poor Herbie moves. The proverb “A chain is only as strong as its weakest link” describes that if one member of a team doesn’t perform well, the whole team fails.
The author compares business production to the hiking troop; how to get Herbie to move as fast as he can so that the troop reaches the campground faster. If Herbie’s backpack and other load is distributed among other troopers, they can reach their destination faster. With this example, Goldratt encourages everyone to find the Herbie/bottleneck in the work they do, in order to successfully persevere through whatever obstacle life confronts them with.
The language of business is vast and increasing day-by-day, making knowledge of business school terms an important aspect in any MBA student’s life. So, start incorporating these quirky terms in your vocabulary to ace your B-school life!