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Similarities between investing, intelligence analysis


We’ve talked before about how the analytic techniques and critical thinking that serve as the foundation of intelligence analysis are the same used by many of us in our daily tasks and across a range of professions. In particular, I am always struck by the similarities between intelligence analysis and investing.

Investing uses standard analytic techniques and critical thinking to calculate risks, organize and analyze imperfect data, and identify alternative hypotheses, information gaps, and contrary evidence. Those who invest must be forward thinking and predictive of future events when considering information and circumstances within and outside of their control. While the goal is to make money, the process is similar to an analyst analyzing emerging trends and threats or the evolution in intent and capability of a group or country.

Consider the recent announcement by Hewlett Packard that the company is planning to spin off its personal computer business unit. The stock was hammered on Friday after downgrades and doubts about its future strategy followed. Without a clear vision forward, some investors may decide to avoid investing in HPQ altogether. Others may see an opportunity to consider whether investing in this down-but-maybe-not-out company presents a potentially lucrative upside.

An investor could use an intelligence analyst’s toolbox to calculate the risk and opportunity of an investment in HPQ, crunch numbers, gather data, analyze imperfect information, and develop an analytic product of where HPQ may be in a set time frame. Could the company survive without a third of its profits from a unit that had a low operating margin? How should the statements and outlook of the company’s leaders be interpreted? Is this an oversell, or is the company heading for more trouble and the selling is justified and likely to continue?

I read a book recently that said the best traders on Wall Street only make money on fifty-three percent of their trades. It’s in their analytic techniques and risk calculation that they maximize their chances for success and, perhaps more importantly, minimize their losses. They push themselves to think smarter and act on information that indicates a favorable risk-reward. News and global events that affect the market will come and go, but tried and tested analytic techniques and critical thinking methods are constants. Intelligence analysts take note.

So you want a degree in intelligence?


It is one of the most frequently asked questions I get from those interested in the field: Where do I go to school if I want to become an intelligence analyst?

Most aspiring intelligence professionals know that securing tangible, critical skills and training coveted by the community will go a long way to lifting their resume to the top of the pile: critical thinking, languages, technology, international relations, regional expertise, oral/written communication, etc. Focusing on acquiring applicable proficiencies, certifications, and real-world experience is perhaps the surest path to a successful intelligence career.

Degree inflation and increasing competition in the job market have caused some interested in the field to question whether there is a need to specialize deeper and grab an intelligence masters or security-related degree if they have not done so already. My advice is caveat emptor when considering intelligence degrees or education programs. Sure, you can get an advanced degree in intelligence, but should you when so many of the aforementioned skills and traditional degrees have been proven to advance careers in the intelligence field? There may be a reason why you are considering this option.

Since 11 September 2001, terrorism and intelligence have been described by some as cottage industries. Programs and training of varying credibility seem to be popping up almost daily. To cash in, universities have been rolling out certificates and degrees related to all facets of homeland security, intelligence, and counterterrorism. Likewise, private companies and institutes have developed their own professional development ranging from seven-day trainings in Israel to fellowships and 10-week courses.

The darker side of this growth has been navigating the minefield of sub-par programs that look like the hot new offering in counterterrorism and intelligence but may actually be a short-term business enterprise with an uncertain future. Some of these are taught or facilitated by experts who moonlight in the intelligence world but may work in different although slightly related fields. The degrees may not be accredited or even recognized by employers.

I am certainly not suggesting that programs with a concentration in intelligence, terrorism, or security studies are not good or even great for working in the field of intelligence analysis. Just be careful that you are not sinking your time and money into a venture that may not be around in five years.

So how can you separate the cash cows from those programs that could add some class to your resume?

First, peer perception and rankings do matter (somewhat). You owe it to yourself to go to the best school to which you can get accepted and afford. It may sound less than official, but sometimes online college boards and graduate discussions are the best place to find out which schools and programs are held in high regard and which could be a gamble. Student accounts, rankings, cost, reputation, and other factors are weighed and debated on message threads throughout these types of sites.

Also, avoid thinking that because something says intelligence or terrorism in the title that it automatically boosts your marketability. Consider whether it is more beneficial to attend a Top 20 school with a solid international relations or government department or an online intelligence degree ranked No. 1 by a private magazine with an unknown methodology.

Second, government agencies that fund, set standards for, and use as laboratories these new programs have identified them as Centers of Excellence for various specializations in homeland security. Many have certifications, academic degrees, and fellowships. Start your search there before you commit 20K a year to a program you hardly know.

Finally, remember that there are many paths to work as an intelligence analyst. One of the exciting and demanding aspects of the field is that it is multi-faceted, and requires the mastery of a number of diverse skills to be successful. So before you drop 50K on an online intelligence degree or 5K on a trip to Israel thinking they are easy tickets to your dream intelligence job in a tough economy, take some time to consider your options and whether it is a program that will be as strong in 10 years.