Office Politics… It Only Gets Worse

We wrote a quick view of office politics at the entry level and it only gets worse. Once you’re able to distinguish who “matters” from who doesn’t and correctly align your reputation with the top performers… You’re only one step into the madness. We’ll attempt to explain some of the high level strategies to continue getting ahead while maintaining high external performance as well. Fortunately, we’re no longer in the field and this will likely be the last Wall Street related post we do for quite some time (excluding general market compensation updates well ahead of the news).

Review: Before jumping into office politics at the revenue generating level lets review what needs to be done for a junior banker who is trying to make the jump from low six figure income to mid-six figures as fast as possible:

1) Performance always comes first. Without doing your work correctly no person at the firm will ever like you. Throw away this notion that it is “all politics” in reality it is more of a 50/50. But. The first 50 percent is a *requirement* which means without good performance, nothing you do from a politics stand point will ever help you (only exception is your mom or dad is the CEO of a major client/company).

2) Once your performance is locked down… It is time to avoid association with people who are not in the “inner circle”. This is easy to find out. Write down all of the people who are generating the most revenue and write down the order of the names on internal large emails. People will mess up. You will be able to tell that the top priority people are generally mentioned up front in several emails “accidentally”.

3) While rank order at a firm is important it is not a 100% predictor of being in the “inner circle”. You may find that a managing director is on the verge of being fired, while a director has clear line of sight to an MD promotion. The clear move is to associate more with the director since the MD is losing more and more of his *political capital*

Now that we’ve reviewed the three basic items we’ll go into the details of how to survive in a revenue generating role.

It Only Gets Worse (Part 1): Make no mistake. The politics only get worse at a revenue generating role as you’re forced to cross pollinate your support internally. It is not enough to have one or two big hitters above you as support. You now must spread your marketing internally to other branches of the firm. If you’re a banker, you want the sales team and research time (only top performers) to know you extremely well. Once you have support from other branches the firm will then believe you’re “in it for the long haul”.

1) The first step is finding the top performers in each division and slowly building out a contact list there. Maybe you can meet at conferences and industry events or you can meet at Company wide “global leaders” events. Either way. You must find a quick way to begin establishing rapport with the rest of the top performers

2) You must avoid stepping on the wrong toes. If person A is well liked by person B (higher up)… and Person A does not like you… You’re going to have to find a way to get Person B to like you. Why? Well, with 100% certainty Person A is sharpening a knife to throw right into your back as soon as you slip up even once. Make one mis-step and he’ll take you out. The only way to avoid this political disaster is if Person B already likes you and he’s aware… Now you’ve effectively castrated a potential conflicting situation. Person A will now find a easier fish to fry.

3) Divest the HR team. At this point, HR becomes less meaningful and you can simply begin divesting your interest in their opinion. While you were previously building rapport across HR as a junior employee, your best bet is to simply get Junior employees to be “okay” working for you and HR will view you as a “middle of the road employee”. This is now okay. Your pay does not touch the hands of HR anymore so you’re best to invest time internally promoting your own work.

In summary, while your previous goal was 1) performance, 2) top performers and 3) HR. Your new goals are 1) clients, 2) Top Performers and 3) performers outside of your group. This is a key distinction as your time spent being the HR cheerleader is no longer worth it.

The VP Avalanche Zone: To summarize the first level of revenue generation, you’re on the chopping block. The best way to think about Wall Street is as follows: 1) Analyst – overpaid person they are trying to invest in, 2) Associate underpaid person by year 2 as you should be client facing, 3) VP – every single action scrutinized, 4) director/MD – consistent performance based income.

1) The biggest mistake is mentioned above. Now that your entire livelihood is based on performance there is no reason to waste your valuable time with issues that do not generate income. You already have a strong foothold with HR and other non-revenue pieces of the Company so you just need to maintain your perception in the office. Do not reinvest valuable time into being a cheerleader when you can make 2-3 phone calls to clients instead. Finally, if you have an extra 10-15 minutes to help a non-revenue generating position like HR… Then go for it. The point is that you never spend a single second on it if you can find ways to generate revenue instead.

2) Bolt on if possible. Assuming you’ve done a great job establishing relationships with top performers, there is a high likelihood that the top performer has spill over clients. This is a gold mine. While you’re not going to make a ton of money taking table scraps from the guy making $3M+ a year… You’re not going to get yelled at either. There is nothing wrong with serving clientele who were previously *underserved* in the past. Lots of people make the mistake of either 1) going it all alone into a different direction or 2) trying to build a base from scratch when others are willing to help. There is a clear middle ground where you pick up easy slack and spend your free time on adhoc client building.

3) Get ready to manage egos. No matter what you do, lots of clients and internal employees will not like you. This is the name of the game. The president of the United States gets a 50% approval rating so don’t expect a 90% approval rating from clients either. Again. This emphasizes the importance of solid internal relationships as the hand me down clients are the easiest to win over if you can simply avoid dropping the ball.

In summary, you’re going to take the low hanging fruit if possible and get used to lots of people not liking you because… well.. it’s always a numbers game.

Break Off Transition: Assuming you’ve done a good job with the three items above it is now absolutely paramount to do the following 1) give credit to everyone who helped you and 2) get an offer from a competing firm. What?! Yes you read that correctly.

If you do extremely well and give credit to people who help… you’ve successfully done the right thing in the eyes of everyone. However. If you have correctly built out a base outside the low hanging fruit it will be extremely easy to jump to another platform. Once you obtain an offer you’re going to see exactly what they think in terms of your potential long term. This is going to result in a direct promotion or a new position… with of course another promotion.

There are rare instances where you won’t need a bargaining chip. But. The reality is that they will hold you at the VP level for as long as possible. They will claim all your success is related to people above you and you’ll “play dumb” by echoing the same sentiment. Again. If you’re smart. You’ve used the low hanging fruit as selling points to your other group of organic clients and can hit the ground running at a new firm. In addition, once your current firm realizes you’ve already carved out a new niche, they will have a hard time letting you simply walk out the door.

It Only Gets Worse (Part 2): Now lets assume you’ve done everything correctly. You survived the avalanche zone. You have moved into an SVP or Director role. Now you’re effectively a standalone entity with a dwindling amount of political capital. The positive is that all your political capital can be used directly to make more money and the negative is that you’re officially back to square zero from a political capital perspective. (Reminder, each year of solid performance is about 1 unit of political capital and every 3-4 units means a meaningful promotion or raise).

Just one problem. The ceiling is becoming real.

At this point, you’re surrounded by ~80% solid performers and 20% mediocre ones. The bonus pool to chase after is now a dog-eat-dog fight as all of you understand the game and will be leveraging every single offer to get more money. Every transaction closed, every single item that shows up as revenue will be an immediate tug into the direction of the generator. In an ideal world you’ll be doing more transactions than most. But. That is not always the case.

Finally, the last bit of headache is the client hurdle. The top performers naturally have the top clients so it is even more difficult to crack into the higher fee transactions without even being in the room.

You can guess what needs to be done now… Which is latch on aggressively to your new carved out sector and client base. Your new game plan is to continue growing the base outside of the giant clients and wait for them to evolve and grow. The faster your new clients grow to become major companies, the better and easier your life will become.

One last word on this… Wall Street is extremely small. If you find a specific person was recently fired or jumped to a new firm… You should immediately email and contact that firm to see if you can jump in with a few extra business cards (IE: they let you take over a sector that was already covered internally by your firm).

Thoughts on the Future: Near-term we’re not incredibly bullish on Wall Street compensation. If money is continuously printed perhaps we see a couple of years of flattish pay until the inevitable decline and eventual recession. The layoffs have already occurred and as we noted… well in advance… bonuses were down about 5-10% (9% being the average).

The quick take is that we’ll eventually have to go through a downturn or compensation compression time period for a couple of years. In this environment it is actually better to *enter* the industry at the bottom and it is best to *exit* the industry around now before the decline.

Thoughts on What to Do: We’ll say it a million times (pun intended), there is no reason to rely on someone else to pay for your food, rent and livelihood. Every single person should own a business that does not require you to trade time for money (no scale). Once you can create an actual product that sells and is not a mumbo jumbo feel good product (heroine for regular people) you can sit back and really appreciate actual control of your life. Most think they dislike their career, but in reality they dislike *reporting to other people*. Being in charge of your own life and freedom is really the first step to being rich in the first place.

Comments

  1. Young Manhattan says

    Looks like you guys still know what’s up even though you don’t work on the Street any more!

    Think a major mistake some juniors make is putting politics before work performance. Ie. focusing 100% on the top MD’s work but getting the bottom MD’s work flat out wrong or shit quality. Although you’re right from a political perspective, if you’re getting other work WRONG or doing it after very low quality it’s hard to bounce back…

    • Wall Street Playboys says

      You got it right. It still is a 50/50 however. Just the first 50% is performance.

      If you’re good but attach yourself to the guys who are going to get popped… You wasted all of that work on a nobody.

  2. DropOutSoftwareEngineer says

    I really like the part about looking at the order names on an email…Never thought of that before!

    One thing I’ve noticed as someone in the tech industry (I’m guessing this also applies to all industries) is that you have to be good at what you do AND be willing to do extra to help out top performers and people “in charge”. I followed this and surprisingly have this reputation at my job now (been there 7 months) of being a dependable guy who gets the job done. I get shoutouts all the time from the managers. Downside of this is of course is that other people want to tag you onto their tasks, but I’ve learned from reading this post to slowly eliminate people who won’t contribute to me generating more value to my political capital.

      • says

        This post and a lot of the advice in it crosses over into other industries, I work with electricians and I applied your revenue/performance first, getting person a to like you when person b doesn’t, and impressing the top dogs advice to great effect. Keep up the great work fellas.

  3. Wolfinsheepsclothing says

    Made the mistake of telling my boss about registering for an networking event in CIB. I work in retail side. They asked to me to speak to hr too see if I’m allowed to go. When my boss’s boss confronted me I replied it said “young leaders external networking event so I just clicked register”. Playing dumb. He laughed and carried on as per normal. Playing dumb saved me from an embarrassing situation.

    In essence none of your co workers (including friends and family) want you to do anything outside of the job as it reflects on how they are doing, making it even more crucial to learn how to play dumb.

  4. Bob Smith says

    Gladiators killed and died for freedom.

    You taught me that all one has to do for freedom is create a scalable business that can be run remotely.

    Thank you.

  5. Eric says

    One of my very successful entrepreneur hated office politics because first he is not good at playing it and also dislike it very much . and that’s part of the reasons he started his own venture in a business that he could deal with clients directly and make money his way. Another thing he said he would Fire anyone who is trying to play pilitics to drag his own organization down.

    • Eric says

      I guess that’s also why the big distance between the boss and employees and all that structural layers give room for people who are good at office politics to grow and proper

      • JG says

        I work in enterprise software and the quality of the code (product) is definitely not the most important thing in the industry – at least not in my experience.

        One reason is because software companies sell to business executives who make the purchasing decisions. They won’t use the software everyday.

  6. says

    Quick question:
    Just kidding.

    Great post as usual. I just accepted a tier 3 job. Started reading this blog around 6 months ago. Almost moved to another tier 4 without realizing it (asset management) before I read your navigating the street post.

    Thanks for all you do, keep it up.

  7. says

    The higher you go, for sure the more politics there is. You need 10+++ people to be your supporter to get up to MD. If it is not consensus, you are screwed, b/c the MDs themselves don’t want to piss off other MDs in other departments.

    Got to look at the stats of what percentage get to Director then MD. Once you realize it’s a minority, then I think you might be happier.

    Sam

  8. RR says

    Brilliant, as always.

    I like how you put emphasis on branching out in this post. A lot of people seem to pigeon-hole themselves by not connecting with power players in different divisions or former coworkers that relocate to different firms. Great insight.

  9. Sergio says

    Even off wall street I feel a lot of what you say applies. Your talent is usually 50% of the equation and your network(politics) the other 50%. I saw that even since middle school, growing up in a small cow town, my mom stood out with her bachelor’s degree and 15-plus years in architecture, so she landed a job pretty much on her first shot, even though she was weak on the politics side. On the other hand, I know of many talented people who go to a very competitive market(wall street, silicon valley, etc.) and they get lost because their MBA, internships and experience make them a dime-a-dozen, where getting endorsed by the right people makes the difference.

  10. Anonymous says

    As soon as I started thinking more business strategy oriented and bettering my dating life I started acting more confident on default. Coworkers literally began starting shit with me and interestingly enough word got out that I was “lazy” and ‘not doing shit’. Funny part was I was the only one that gave a damn about productivity and would work hard and honestly felt (emotional cloud) I was getting along with everyone. I was moved to two different departments because the coworkers told HR they ‘couldn’t work with me’. These cats are hands down salary slaves with poor health, style, and 0 ambition (CEO included) -go figure. It’s an internstional engineering company that even Carl Icahn would be very disappointed in if he’d even bother looking at it; the workers are poorly managed. I see now it’s my fault since I let slip twice that I was entering real estate on the side with hopes of running my own business one day with a good portfolio. I learned my f*cking lesson for sure -no matter how well you think you get along with your coworkers, if you surpass them in virtually any aspect, they *will* throw you under the bus first chance. The flip side is my people skills have gotten better, I know how to keep my mouth shut and who, upon talking with them/even looking at them, I need to lie down with. Also now I’m grinding my ass off more than ever to leave this joint. Good news is I’m projecting that I’ll be out within a month or two tops seeing that I have a strong plan I’m acting on.

  11. Syd says

    Spot on. Echoing what others have said the advice branches out to other industries (accounting/financial planning for me) no one cared how much I made, switch to a new revenue generating role suddenly I’m paid too much for what I do (bring in new clients). Easy fix – commission doesn’t go on pay slip for a period, that period’s pay slip can easily be found, on accident of course… Suddenly people think I’m paid less than everyone else and they are all friendly again, willing to do the work for a new client I bring in freeing me up for my side gig bring in more clients and making more money… Go figure

  12. Brett says

    This has proved invaluable to me as I start my career in enterprise software sales. Relatively same structure over here but a little more laid back but regardless it translates. Lots of fish in these waters and few sharks.

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