Meet Finance Professor Micah Officer
Micah Officer talks about his role as a finance professor and administrator for the Executive MBA program, and where he sees the fields of business and finance headed in the new global economy.
Describe your various roles in the EMBA program.
As a professor, my job is to get students excited about finance. Many students are intimidated by finance because of the quantitative nature of the discipline, and — by virtue of their career progression — typically haven’t had to get “in the weeds” with math since their undergraduate days. But finance is so important because it is a discipline that affects every single one of us. We all have to manage our personal finances, pay our bills, put our children through college, and save for retirement. There isn’t a single student in the EMBA program who isn’t touched by finance in one way or another (and most of their jobs are actually affected by it).
Sparking that inspiration can be a challenge due to the diversity of experiences and perspectives in an EMBA classroom. Over the course of my EMBA career, I’ve taught a fighter-jet pilot, a church administrator, a professional model, and a portfolio manager for one of the world’s largest asset-management companies. Finding common ground where students can be inspired by the material can be very challenging. For example, some students feel that the class is moving too slowly, while others feel like it is moving overwhelmingly fast. With such student diversity, finding the right pace, method of delivery, and depth of material that works for everyone is a balancing act that keeps me on my toes.
As a module leader (what we call a “manager”), I’m responsible for behind-the-scenes organization that results in faculty teaching students for eight hours every Saturday. I ensure that faculty schedules are aligned with the module calendar; that the curriculum is current, relevant and approved; that textbooks are ordered and delivered, etc.
How do you see an EMBA education as an enabler for students’ careers?
I see this as an issue of perspective. An EMBA education isn’t about acquiring tools to use in the workplace; rather, it’s about acquiring the perspective to make oneself a better manager of people. That perspective on how these tools (finance, accounting, marketing, etc.) are useful in analyzing business problems allow leaders to see the connection between the outputs of an organization’s functions, and understand synergistically how the pieces fit together. By getting exposure to the big picture, our graduates become better leaders because they have the perspective on how each of these tools are used and how they fit together. In the example of finance, almost none of my students will go on to become finance managers. However, they will become better general managers because they will know what someone is talking about when they use the term “internal rate of return” or “net present value” – and will know how those concepts can be applied for the greater good of the organization.
Why is financial literacy so important for leaders today?
All successful organizations have one fundamental process in common: they take capital, grow it, and return more of it to the providers of that capital. At the core of every business are the following key finance questions: How do we raise capital needed to invest in an idea or product? How should we decide which ideas or products are likely to grow that capital the fastest? How should we return that capital to the institutions that provided it to us? Finance is at the heart of every business process; therefore, understanding finance is a skill business leaders must possess.
What challenges/opportunities/trends do you see in the US/global economies?
Globally and in the United States, the main economic challenge is growth. We've reached a level of development where shortage of capital is no longer a problem in most developed markets. As long as you have a good idea, in the vast majority of cases, someone will fund it.
To maintain standards of living, economies must grow their output faster than their population. On every continent (perhaps except Africa), growth is slowing and a lot of that is driven by a decline in productivity. An economy grows by increasing productivity. The Internet era introduced a massive, positive productivity shock to the US and global economies. As a result, we as a society could produce and consume much more using the same inputs. But the positive effect of that productivity shock has worn off and we need to find something else that spurs productivity growth. Since the financial crisis, US aggregate output simply hasn’t grown more than two percent annually, if that. This level of growth, when compared to the expansion of our population, isn’t enough to continue improving our standard of living (such as we did from 1990–2005).
Technological advances have also created many challenges and opportunities. Politicians today are obsessed with preserving and expanding the base of “well paid” jobs in America (a noble goal); the problem is that many of these jobs no longer exist and will continue to disappear. For example, according to the 2012 census, the second most commonly-reported occupation in America is “cashier.” Amazon is working on a cashier-less grocery store in Seattle; and I’m sure there will be more in the years ahead. Combine that with the damage that driverless cars and trucks will do to the taxi- and truck-driver occupations. It is possible that we have innovated ourselves out of the means to employ many working-age people in this great country — one of the reasons some economists are talking about having a Universal Basic Income in America (paying people whether they work or not because there aren’t enough jobs for everyone).
In such an economy, the “skill premium” is obviously higher. If there are large fractions of the population without unskilled jobs, it means that the skilled part of the population must, in combination with technology, be incredibly productive, and therefore well compensated. Going through an EMBA program is one way that people can both increase their current skill levels in specific areas (perhaps helping their current career) and increase their perspective about business (and the world) to help them prepare for a future career which may be very different.
Skilled and talented people, such as those that EMBA programs produce, have always had an advantage in the labor market, and I anticipate that gap widening considerably in the years to come.