Matt Levine on CX cadets
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Matt Levine on CX cadets
From today's Money Stuff newsletter:
Oh, not cadets, he's talking about IB analysts...
Ask a Manager Here is a fun online advice column in which a senior investment banker apparently wrote in to ask how they could get analysts to stay for the full two-year analyst program. “I’m thinking of something along the lines of a contract that would acknowledge that the training provided has value that must be repaid if the person doesn’t stay for 24 months,” they suggested. The columnist — Alison Green of “Ask a Manager” — replied that that sounds bad but try working them less:
To keep them, you need to be able to compete with the other options they have. That doesn’t just mean money; it means lifestyle too.
You’re looking at ways to penalize them for leaving … but having exhausted, overworked people who are there only because you will bill them if they leave is a recipe for demoralized and resentful staff.
What if you hired more junior staff, had them work fewer hours each, and lowered the pay accordingly? Everyone might be happier with that in the long run. It’s more people to supervise, and that’s more work … but it’s not more work than training people who then leave just as they’re becoming useful.
I don’t know what is going on here? I assume that if you are a “high level manager bringing in significant business” at an investment bank you are not actually writing in to an online advice columnist to ask how to run an analyst program? Still. I was an investment banker for a while and I have an instinctive negative reaction to “what if you hired more junior staff, had them work fewer hours each, and lowered the pay accordingly?” “That’s just not how it works,” I want to shout; “this is a client-service business and clients need continuity of coverage, and without total commitment you will never learn the skills deeply enough to be useful,” all the usual stuff. But it is the case that (1) everyone who is not indoctrinated into investment banking tends to say “why not hire more people and work them less?” and (2) banks do seem to be having trouble keeping analysts. Perhaps emailing outsiders for advice has some merit.
To keep them, you need to be able to compete with the other options they have. That doesn’t just mean money; it means lifestyle too.
You’re looking at ways to penalize them for leaving … but having exhausted, overworked people who are there only because you will bill them if they leave is a recipe for demoralized and resentful staff.
What if you hired more junior staff, had them work fewer hours each, and lowered the pay accordingly? Everyone might be happier with that in the long run. It’s more people to supervise, and that’s more work … but it’s not more work than training people who then leave just as they’re becoming useful.
I don’t know what is going on here? I assume that if you are a “high level manager bringing in significant business” at an investment bank you are not actually writing in to an online advice columnist to ask how to run an analyst program? Still. I was an investment banker for a while and I have an instinctive negative reaction to “what if you hired more junior staff, had them work fewer hours each, and lowered the pay accordingly?” “That’s just not how it works,” I want to shout; “this is a client-service business and clients need continuity of coverage, and without total commitment you will never learn the skills deeply enough to be useful,” all the usual stuff. But it is the case that (1) everyone who is not indoctrinated into investment banking tends to say “why not hire more people and work them less?” and (2) banks do seem to be having trouble keeping analysts. Perhaps emailing outsiders for advice has some merit.
Oh, not cadets, he's talking about IB analysts...
