It doesn’t need to be this way
Im a group head and it’s been some time since I’ve been on this board, until the very justifiable outrage over the tragic death. It’s not the first time it happened, but it’s the first time it can be directly tied to unacceptable work hours. I appreciate the idealistic zeitgeist and desire for wholesale change and it’s again, justified. That said, even without wholesale change, IT DOESN’T HAVE TO BE THIS WAY.
I will caveat that banking will always involve and long and often unreasonable hours; deals are time bound events where large amount of work needs to happen in short periods of time. It’s a competitive industry with high rewards to the winner. However, there are several practical things that can happen in a culture to retain, sustain and motivate good people while avoiding soulless and unhealthy burnout.
In my own team spent the past few years trying to turn around a culture that was deeply inefficient and characterized by unecessary work hours and turnover. Nothing is perfect, but I’d like to say today we have industry leading retention of analysts and associates and a culture we can be proud of without sacrificing business. Selfishly, retention of people creates much better client outcomes and makes for a much happier environment to be part of. In that light, I thought I would offer some practical tips (without being too specific to reveal who I am) to anyone who cares to listen about about steps that can be taken to create better banking work environments.
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Create the right senior incentives - Banking focuses too often on the top line and not the cost to achieve it. I monitor my senior bankers use of juniors and make sure they know it will hit their comp if they are inefficient with the time of others or cause turnover. I also reward efficient senior bankers for that.
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Get client exposure to juniors - a lot of banking inefficiency happens because a client request comes in and by the time it filters down to the person doing the work, it’s longer, vaguer and more urgent than it would have been. When junior bankers are interacting with clients and build relationships, the flow of work is far more efficient and it has the ancillary benefit of helping them grow their careers.
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Don’t succumb to mid level clients - mid level clients are the worst. My senior bankers will get destroyed if I find themselves doing make work for mid level clients
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Create systems and process and force accountability - I can’t get into the specifics of what I do but before any workstream, I’ve forced through a process to the team that builds senior level buy in and is designed to limit the iterations. We are not perfect here but working to get better.
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Find leaders and culture carriers - when we began working to transform our culture, I sought out the leaders amongst the juniors, listened to then, implemented their suggested changes and given them increased managerial responsibility.
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Empower staffers - staffers are very clear that their primary job is to protect juniors, and act as a sounding board and buffer. No senior banker has the ability to overrule the staffer.
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Treat people like individuals - everyone is wired differently and you get the best out of people when you treat them like individuals. For example, I know there are some juniors who will never push back and the staffers have to proactively set limits for them. Other people -are quite capable but don’t like to leave the comfort zone so staffers are encouraged to put them in situations where they are forced ti take risks.
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Weed out poor performers /- all of this works when people are good performers and committed and would break easily if we tolerated poor performance. Stronger performers are more valued and more empowered.
The goal of all of this is to create a work culture where individuals are valued and high performance and efficiency are seems as symbiotic. Are we there yet? No, but we are a lot better than before and the environment is a lot happier SAS a result. And yes, it’s possible to create a better work culture if people try.
Can I work for you?
Are you hiring?
How about we use this thread for practical, implementable solutions to a) increase workplace efficiency, b) improve junior learning, c) address lifestyle excess. I believe all of these things will inherently include quality of client service (if they don’t, they won’t happen). I’m always interested in hearing what’s out there.
What’s your stance on people taking vacation time? Would you be unhappy if someone took a 2-week vacation?
I think it’s pretty important for people to take their full vacation time, and I think analysts and associates deserve to be truly offline when they are out. As such, the As and As a system that ensures vacations are staggered, planned well in advance and they have redundancy when they are out.
In general, I think two weeks of vacation is tough outside of late summer and Christmas. This is particularly the case for analysts where two weeks are not meaningless in the life of a deal and they don’t have the muscle memory to recover quickly. That said, vacations are monitored and managed at the junior level and the staffer and if they say it’s ok, and have the appropriate cover, it’s not my place to have an opinion. In general, I take the view that if my juniors are going to behave like adults and take responsibility for their work, I’m going to treat them like adults and give them the discretion to make those decisions.
This is 100% accurate, and all of the above are things that are NOT done at my current bank. Are you hiring?
No ones going to be doing this job in 5 years anyway
Wherever you're a group head at I'm sure your employees are very happy and know they're lucky, props to you. Best way to retain talent and build a loyal office as well.
The long-hour culture in ibanking is rooted in the incentive-structure of senior bankers ( MDs ). MDs make money by a profit cut ( the revenue they bring to the bank minus the operating cost ), and guess what? Everyone from analysts to associates to non-deal-bringing VPs are part of “operating cost”. The less headcount for these roles, the more money MD makes. So MDs make money by keeping the team super lean. Some of the most lean teams have 10 MDs and 10 non-MDs, and the non-MD people are getting crashed. Why not hiring 20 more people to distribute the workloads ? Because every penny used to hire are deducted from the bonus pool of MDs. This problem will never go away unless the underlaying incentive structure is changed.
there's also no accountability if the juniors on your team die from blood clots caused by being overworked
why not some sort of "utilisation" for operating cost ie junior banker hours?
e.g. each one has 70-80 hours utilisation cost per week. if they are being over utilised above these hours then it hits which ever MD is running the deal. that way there is incentive not to do pointless pitches & to slave people away for 100+ hours as it will cut down their margin.
appreciate its a "fixed" cost but perhaps if looked at as if it wasnt, things would be different.
So the less productive MD will have to maximize the hours on stupid books
Completely agree with all of what you’ve said. In particular #1, 3 drive me nuts the most. The MDs who never say no to mid level clients and have us running in circles doing endless work (these people are often paying us the worst fee) and relatedly, the MDs who monopolize junior (and VP/D) time on nonsense pitches where we have no chain. Those are the people who have nothing to show on the bottom line. Even when I bring these issues up, nothing gets done to fix it or hold people accountable.
hits home. ive been on an account for a low level client for over two years now and we havent been paid a dime and have put in hundreds of hours of work collectively as a team
It was mentioned above, but I really think junior morale and culture would improve if there was some sort of mandatory PTO block that you HAVE to use every year. I have a bunch of friends in S&T, and everyone on the desk (analyst through group head) is mandated to take a 2 week vacation every year (in addition to your other PTO) where you are totally unplugged. They do this for compliance reasons, but I truly think it would make the job infinitely more palatable and sustainable. Imagine working consistent 80 hour weeks but you have a two week complete break from work to look forward to - at least there is a light at the end of the tunnel.
I have worked in banking for several years now at a few different banks, and my analyst years were pure hell. Even now as associate when I am pretty okay at the job, I still have zero control over my time. The longest period I have had not working was between jobs, and any PTO I took during employment was usually interrupted by one off requests. There was actually an instance when I got berated on a PTO day for not being “accessible” enough (I didn’t have my phone on my for 1 hour in the morning and missed a call). The point is, banking PTO is fundamentally flawed and not truly relaxing.
My fix would be a mandatory 2 week PTO block every year for every team member where you do not open your laptop. This is non-negotiable and it starts at the top, if insecure MDs and VPs do not adhere to it, then no one will. People need breaks in order for this job to be any form of sustainable. And don’t give me the bullshit about staffing needs and client emergencies - everything can be figured out and it’s not the end of the world. Bankers need to learn to push back. There are 52 weeks a year and 7 days in a week and the reality is that most bankers will still be working 6 days a week for 50 of them. It’s a drop in the bucket.
MDs and VPs are constantly on deal related calls even on vacay. Cancelling vacations are super common. Hard to see the mandatory vacation works
That’s the wrong attitude. There’s always going to be shit to do and people who want to talk. It goes back to the idea of bankers being insecure and pushovers. The harsh reality is that the stuff we do in banking is NOT important and DOES NOT matter all that much, despite the grandiose sense of self that some of you have. Have someone else handle it and staff accordingly. The clients and the deals will be there when you get back. I truly feel people would benefit immensely from this.
Agree with all of these and great post. I have a few additions that I've tried to implement in our team to increase efficiency and reduce the number of all-nighters, which I believe could have been almost completely avoided if it weren't for lack of communication and planning:
1. Automation of processes:
Juniors are encouraged to build upon and expand our template presentations and models. Many of the recent grad hires are more capable coder writers, and if you are able to automate a task that was previously manual it will reflect in your performance review. For any template, model or macro, there should be a descriptive and to-the-point "Read me" section to allow other juniors and interns to use it, and it is all saved in a shared folder.
2. Sharing best-practices:
We also encourage sharing best practices, and tips and tricks are gathered in a Notion that we use across the team. This includes anything from how to make the best use of software that we pay for, how to use Outlook efficiently, the formatting guidelines we use, and an email template for various parts of the process.
Oh, and if it's not shared, it didn't happen.
3. More direct communication from seniors to juniors:
If I am presenting something I already have a pretty clear vision of what the presentation is going to look like and what the key messages are. The junior will be brought along, and we often tend to write out many of the headers for the presentation together to make sure we are aligned and agree. This removes a lot of the ambiguity of what is desired and reduces the need for iterations if there is a misunderstanding between the MD, VP, Associate, or Analyst.
3.1. Involving seniors in the drafting process for documents:
We previously had an issue with analysts being afraid to show seniors things that were not in pristine condition, and although detail-orientation is key, I believe many have gone too far. We encourage analysts to share their drafts with the top of the deal team if they believe input is required (not just to the associate level as many others do) to increase efficiency. It does take slightly more time up-front from a senior's perspective, but we have reduced the number of late-night revisions that often come at the twelfth hour and there are a lot fewer "surprises" in the deck drafts (ie. ambiguous or contradicting analyses that distort the message or confuses the reader).
3.2. Call your seniors, DD teams, or the client, if needed:
Many recent hires seem to prefer Teams/Slack/email over the phone, but you often lose nuance when writing compared to speaking. If you have a question that you need an answer to we encourage calling over writing. When you've agreed on something over the phone, take the necessary time to summarize what you've agreed and then send it to the person you just spoke to and cc any relevant team members so that everyone's aligned. Being allowed to call DD teams, or the client, directly builds professional confidence and gives the juniors a greater sense of ownership because they now have a more "personal" interest.
Great post, thanks for sharing.
Generally good responses here, but lots of top down views on how culture and efficiency can be dictated from the top. That requires sympathetic MDs or group heads.
Can we get some tips for juniors in sweaty groups who don't have sympathetic seniors on how to manage, push back etc.? I'll write up a list when I have a bit more time.
This is the way
You don’t know me, I don’t know you, we’ll probably never meet.
But from the bottom of my heart, truly, thank you for saying this as someone in your position. You sound like the dictionary definition of a true “leader”. I would kill to work for someone like you and I am sure your juniors are extremely loyal as a result.
My only request would be the following: you have connections to other MDs, to people that make these decisions. Slip this into your dialogue with them. You are an extremely rare type in this industry and, unfortunately, it feels like MDs only listen to other MDs when discussing in private. Spread your culture, I hope it will be contagious.
Thank you for posting this, truly
Love this! Some reactions:
On #1, the bad managers are usually the rainmakers bc they are hunting for deals all the time. No banks will ever penalize the rainmakers until well, it’s bad enough like this bofa incident
On #6, staffers are used to allocate resources not protect juniors from my exp. They are incentivized to please the MDs and to get the promotion
On the mandatory vacation piece w/o ever working above, as long as you are in deal related high finance roles, this unfortunately won’t happen
Disregard my title, I'm S&T. When I was deciding where to work I went to a range of talks from IB and also S&T.
Very senior IB MD was giving a talk about how he had a really big overseas family trip planned but at the last minute had a big deal so he cancelled the family vacation to work. He thought he was awesome and his job was so important.
Instantly turned me off IB.
An earlier poster talked about the mandatory two weeks of PTO in S&T.
The thing is, if your job isn't serious enough that compliance mandates you take two weeks off then the reality is it doesn't matter if you finish some slides or not. The culture in IB is ridiculous.
My advice is go to S&T until IB gets reasonable and looks after the health and wellbeing of juniors.
End rant.
There’s a reason that S&T gets paid lower than IB
It does make less… really top traders can make as much. But on a $/hour basis it isn’t even close. S&T is substantially higher pay when factoring in working hours. So it just depends what you are looking for.
Cool in theory. 99.9% likely that it's standard IB lip service. Heard the same spiel at different banks in the past. The issue is the most senior people are also the craftiest, so they know which buttons to push and what people want to hear. Yawn.
Yeah, I'm confused why so many people on WSO think the recent BoA death is going to change anything. Do people not remember the NYU intern who fainted on the subway tracks and got ran over by a train because Lazard didn't even provide any transportation after the Mets game? If nothing was done after that fiasco, there won't be any sweeping reforms after this tragic incident either
Late but this is very well-stated. So many of the Directors, MDs, etc in this industry (not just IB) lack proper, standardized leadership development, which translates to a culture of "I went through it, so you have to." No -- the means don't justify the ends. It's one thing to run a deal process, it's another to invest in people, and if you don't do the latter then God help you.
I find the belief that culture is the primary problem... interesting. Especially because every senior will always caveat this perspective with "deals are always going to be intense and time pressured and sometimes the all-nighter just needs to happen". So there's an acknowledgement that the kind of circumstances that led to this most recent tragedy are inevitable for deal teams.
Given this, I think culture accounts for about 30% of the problem, the rest is being 20 years behind modern technology. The tech investment gap between the trading floor and the investment banking teams is WILD. I started by career in S&T and lateraled into investment banking a few years in. I did my fair share of all-nighters. I would say that during those all-nighters at least 50% of my time was spent on truly mindless work: copy/paste, format, etc. The work just wasn't that hard, the tools were totally insufficient.
In S&T, similar mind-numbing jobs exists, but there seems to be enough margin compression in those businesses that there is steady progress toward automation. The job I had as an Analyst 1 in S&T doesn't really exist in the same way today.
Whether it's being siloed from tech teams due to deal confidentiality, a lack of margin compression to motivate investment in tech, or just being in the middle of a 20 yr fire drill and not looking around, banking has fallen decades behind other industries. They are going to have to invest in more than a bigger army of analysts to close this tech gap.
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