Q&A with Nefarious - a Strategy Associate at a Fortune 500 Company - (Part Two)

Following up my my post from last Thursday , I'm here today with part two of my interview with Nefarious.

For those of you that need a refresher, Nefarious is a Strategy Associate at a global Fortune 500 aerospace & defense company. Check out part one of my interview with him for some great in-depth information on how he broke into his role, what he does from day to day, and the pros and cons of working in Strategy along with some great follow-up Q&A in the comments.

In today's post, we cover tips on breaking into Strategy roles, potential exit opps for Strategy professionals, and his views on both the defense space and the fiscal cliff.

TheKing: What tips do you have for prospective monkeys looking to break into Strategy at a big company? Anything you wish you knew when you went through the interview process? What does your company look for in prospective hires?

Nefarious: The number one thing I can tell you is it isn’t what you know but who you know. On paper, I am not that impressive. Small tech firm experience, non-target top 50, mediocre GPA. Network and get yourself in front of the right people. Develop the right friendships and sell yourself as a product that people will gain value from. It’s never too late to change directions. Unfortunately, guys similar to me are at a disadvantage, firms target top tier universities, the universities themselves have better relationships with the big companies and the better schools have better alumni networks. Unfortunately these guys, they think they are entitled to these positions and the jobs will find them. Take advantage of their arrogance and strike before them.

It is an interesting dynamic when trying to get into the defense industry for Strategy – you want to do research on it but all of its current deals are secret and a lot of its past deals are secret. Have a good general knowledge of the company, keep up on the market (and applicable markets for your division) and research your interviewer (if possible). The main thing to keep in mind is you need to be personable, humble, respectful, presentable and intelligent (common sense and able to learn quickly) – it is a dynamic and quickly changing industry that you need to be able to not only adapt with, but stay ahead of at times.

TheKing: How about exit opps? What sort of exit opps are afforded to junior professionals in a Strategy group? Any opportunities to work in a management capacity?

Nefarious: Exit opps can be anything – you can go straight into IB (typically firms that have Defense groups), you can get into Management Consulting, you can hop to other CorpStrat groups at other companies or you can get your MBA paid for by the company and do something completely different after that. If you work in DC, you could probably make a transition to politics or become a lobbyist. The opportunities seem to be endless in the DC area. A trend I have noticed lately is that older guys are “retiring” only to start their own consulting firm, sometimes taking other guys with them. If you are interested in getting in on the ground floor of something like that, that seems to be an exit opp right now.

Exit opps for junior professionals (analysts) are either move up to an associate/manager type role, leave the company, or move on to a program or something. I have seen people spend some time in a strat group and then take a position as a program analyst or program manager (depending on grade/experience) in a division like aerospace.

Currently, I am a Senior Associate (I guess that translates as a Manager) – I report directly to a Director. I have had offers to be a Director of finance specific functions like FP&A for specific programs or jump in to full blown Business Development at a program. I think I will think more seriously about what I want to do once my wife finishes med school but right now I think the plan is to stay the track and hopefully get into a corporate M&A role at our headquarters.

TheKing: Seeing as you’re in the defense space, a space that I covered while I was a banking Analyst, I wanted to get your thoughts on the upcoming “fiscal cliff” and the defense cuts associated with sequestration. Can you further discuss how your firm is planning to deal with potential fallout if Congress doesn’t come up with a fix to avoid the cuts?

Nefarious: This will have a different outcome for different divisions. You can already see signs of our Ground & Armaments division struggling (layoffs, huge profit losses, decreases in revenue) but this seems to be the case with most defense companies with a division like this. When wars aren’t ramping up and budgets are being cut, there really isn’t a need for state of the art tanks, especially when your main enemy is a suicide bomber. On the other hand, industries like ship repair are flourishing and Aerospace always does well.

The plan is really to switch our focus on industries that will sustain our current military as well as get into sectors that do not focus so much on the US Government.

TheKing: What are your long-term views on the defense space? Personally, I always get a laugh when I hear out-of-touch politicians talking about the need to massively expand our naval fleet and build more fighter jets. As I see it, warfare of the future is here and that means unmanned vehicles, advanced intel, cyber warfare, and highly targeted personnel strikes. What’s your view?

Nefarious: You’re exactly right. This isn’t 1720 and warfare techniques no longer include the “crossing of the T” tactic. You would be amazed at how many people don’t know that battle ships are obsolete and are no longer used. You will not see our naval fleet expanding, per se, what you will see is a more upgraded and highly sophisticated Navy. The Navy is important for a few reasons:

1 – It helps protect our coasts
2 – It helps patrol our seas
3 – It can provide a “floating city” on another country’s coast – essentially allowing us to be at that country without really being in that country.

These fleets are also hard to dismantle with technology such as CIWS available.

Although, none of that seems to matter if you are an oil tanker.

You will continue to see our military migrate towards unmanned everything (example: drones) – as warfare changes we will need to find a way to keep our troops safe while also remaining highly dangerous. Drones provide that opportunity.

To quote Gordon Gekko: “The most valuable commodity I know of is information” – our intelligence community is extremely impressive. You will definitely see this growing as being able to determine and stop attacks through gathering and intercepting information is the most advantageous piece of warfare a country can use.

TheKing: Are there any stocks in the space that you’re bullish on?

Nefarious: I am not a huge stock guy. I think L-3 Communications is a solid, stable company. General Dynamics and Northrop seem to be staying the course as well. I also like Lockheed and UTX. Boeing is always a safe bet as well.

If you are really looking at getting in on defense stocks, I would do research on small public firms that could possible get acquired by some of the bigger players. Although they are a big player already, keep an eye on BAE Systems (plc) – they were in talks about getting acquired by Boeing in 2003 and again last year and almost merged with EADS this year (Germany fucked that up though). It seems like their big goal for the past ten years has been sell or merge.

TheKing: Do you have anything else you’d like to share with the community?

Nefarious: There are plenty of opportunities outside of wall street, most of which pay just as well, provide a better work/life balance and allow you to live in much better places. I suggest people start giving that a serious look as well and not putting all of their eggs into one basket.

_______________________________________________________

That's all, folks. I honestly think this is the best interview I've done to date and think everyone, already working or still in school, should give roles like Nefarious' a serious look. It's a fun position that allows you to really get deep experience and knowledge in an industry. And thanks again to Nefarious for taking the time to do the interview.

If you've got any additional questions, leave them in the comments. And don't forget to check out part one of the interview.

 

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You're born, you take shit. You get out in the world, you take more shit. You climb a little higher, you take less shit. Till one day you're up in the rarefied atmosphere and you've forgotten what shit even looks like. Welcome to the layer cake, son.
 

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"The whole problem with the world is that fools and fanatics are always so certain of themselves, and wiser people so full of doubts." - Bertrand Russell
 
Best Response

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You're born, you take shit. You get out in the world, you take more shit. You climb a little higher, you take less shit. Till one day you're up in the rarefied atmosphere and you've forgotten what shit even looks like. Welcome to the layer cake, son.
 

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Remember, once you're inside you're on your own. Oh, you mean I can't count on you? No. Good!
 

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You're born, you take shit. You get out in the world, you take more shit. You climb a little higher, you take less shit. Till one day you're up in the rarefied atmosphere and you've forgotten what shit even looks like. Welcome to the layer cake, son.
 

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You're born, you take shit. You get out in the world, you take more shit. You climb a little higher, you take less shit. Till one day you're up in the rarefied atmosphere and you've forgotten what shit even looks like. Welcome to the layer cake, son.
 

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You're born, you take shit. You get out in the world, you take more shit. You climb a little higher, you take less shit. Till one day you're up in the rarefied atmosphere and you've forgotten what shit even looks like. Welcome to the layer cake, son.
 

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If your dreams don't scare you, then they are not big enough. "There are two types of people in this world: People who say they pee in the shower, and dirty fucking liars."-Louis C.K.
 

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You're born, you take shit. You get out in the world, you take more shit. You climb a little higher, you take less shit. Till one day you're up in the rarefied atmosphere and you've forgotten what shit even looks like. Welcome to the layer cake, son.
 

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You're born, you take shit. You get out in the world, you take more shit. You climb a little higher, you take less shit. Till one day you're up in the rarefied atmosphere and you've forgotten what shit even looks like. Welcome to the layer cake, son.
 

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Life, liberty and the pursuit of Starwood Points
 

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You're born, you take shit. You get out in the world, you take more shit. You climb a little higher, you take less shit. Till one day you're up in the rarefied atmosphere and you've forgotten what shit even looks like. Welcome to the layer cake, son.
 

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You're born, you take shit. You get out in the world, you take more shit. You climb a little higher, you take less shit. Till one day you're up in the rarefied atmosphere and you've forgotten what shit even looks like. Welcome to the layer cake, son.
 

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MM IB -> Corporate Development -> Strategic Finance
 

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You're born, you take shit. You get out in the world, you take more shit. You climb a little higher, you take less shit. Till one day you're up in the rarefied atmosphere and you've forgotten what shit even looks like. Welcome to the layer cake, son.
 

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Metal. Music. Life. www.headofmetal.com
 

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You're born, you take shit. You get out in the world, you take more shit. You climb a little higher, you take less shit. Till one day you're up in the rarefied atmosphere and you've forgotten what shit even looks like. Welcome to the layer cake, son.
 

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You're born, you take shit. You get out in the world, you take more shit. You climb a little higher, you take less shit. Till one day you're up in the rarefied atmosphere and you've forgotten what shit even looks like. Welcome to the layer cake, son.
 

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You're born, you take shit. You get out in the world, you take more shit. You climb a little higher, you take less shit. Till one day you're up in the rarefied atmosphere and you've forgotten what shit even looks like. Welcome to the layer cake, son.
 

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If your dreams don't scare you, then they are not big enough. "There are two types of people in this world: People who say they pee in the shower, and dirty fucking liars."-Louis C.K.
 

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Career Advancement Opportunities

April 2024 Investment Banking

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