Office Politics

First of all congratulations. Chances are if you are reading this post you either obtained a position on Wall Street or you want to increase your income. This post is going to be quite long but if you can understand the message and execute we can practically guarantee you will see results. This is tailored to Analysts/Associates since most of our readers are at this level. Lets get started.

 

Entry Level Myth:

“If I work as hard as I can and attempt to please everyone in the office I will obtain a top tier ranking and have headhunters pounding on my door in no time”. Entirely False.  

The truth is you must do the following: 1) find the people within the office who are going to help you get placed into a fund/PE shop, 2) manage multiple tasks prioritizing those with more political weight over those with minimal political weight, 3) respond aggressively to important tasks on the fly and 4) get all of the important people in the office to like you as a person.

What does this all mean? It means on day one you better figure out who matters and who does not. There is no excuse for not knowing who the important figures are within this office by the end of the first quarter. Luckily you’re reading this post so we’re going to make your life a whole lot easier.

Day One – Who Matters?

You’re walking into the office with your brooks brothers T-shirt and your oversized suit and sit down at your desk. After the first 8-10 hours the office begins to clear out. While every other Analyst/Associate is sitting around staring at the screen to show “face time” it’s time to become the CSI of your investment bank.

Investment Banker: Open up the most recent pitchbook with a “qualifications” section. There should be 1-6 slides explaining why they should bank with your firm. Guess what? On the slides there will be Tombstones. Tombstones tell you the most recent deals that have closed and include major deals as well. Circle and highlight all the major deals and transactions over the last 2-3 years. Now go on your Company’s internal contact sheet and find the Managing director responsible for those transactions.

Sales and Trading: This is the easiest one. When everyone leaves the office pretend that you are reading research reports to understand what your Analysts are saying when the dust settles immediately go through the Account list. Quickly look for the major accounts. Fidelity, Capital Group, CREF, Invesco, Wellington, Citadel, SAC Capital, Soros…. You get the idea. Now all you have to do is find the sales person in charge of these accounts.

Equity Research: This is a cross between investment banking and sales and trading. Go through the IPOs that have occurred in the past and see which analyst is constantly being asked to cover more stocks. As an example: Analyst 1 seems to be adding companies over the past 2-4 years versus Analyst 2 who has covered the exact same companies. Why? While not related to IBD due to the Chinese Wall many companies will request a certain analyst cover their stock instead of analyst number two if the stock is between two spaces. Finally, the two other ways to find the good analysts is by looking at 1) call log of clients (if large accounts mentioned above fidelity/CREF etc  call in he is a good analyst) and 2) institutional investor is the trump card. If the analyst is ranked in the top 3, no doubt you want to try and become part of that team find all ranked analysts.

Analyze the Data:

You have the dirt. It is time to look at the food chain and figure out where to position yourself within the investment bank. Again no time to waste. If you choose incorrectly you will have a 10-100x harder time getting promoted compared to choosing correctly. If the guy pulling for you can pay for your promotion as a rounding error compared to the revenue he brings in, you better believe the firm will promote you to keep the managing director happy. It isn’t even about you at that point, a big guy says he wants you to stay, this means the firm will make sure you are paid enough to stay.

You got the names in your hand. Lets say there are three important managing directors. How do you know which one to latch on to? Look at what has happened in the past. Find all of the people within the investment bank who have been promoted over the last 3-5 years. Which managing directors did they work for? Of the three that are amazing, hopefully at least two are kind enough to promote within. Now you know who to keep happy.

Lets look at this from a basic business perspective. If your boss is making it rain and is a golden goose to the firm, why would they care about paying you an extra few thousand dollars? A top tier Managing director is making in excess of seven figures. The bank actually works for the managing director, the managing director does not work for the bank because if he is a top MD he is in charge of the relationships and uses the bank for leverage and/or its balance sheet. They will do what is needed to keep him happy and part of keeping him happy is keeping his team intact. If you are an analyst about to get promoted to an Associate there is no way the firm is going to say no to an extra $50K a year in expenses if it means the managing director will stick around. The number of good analysts/associates is small, so this same logic applies to the Associate to VP promotion however the skillset you need to sell is certainly different. They will simply refuse to promote the other analysts/associates and let them exit the firm. Cost structure unchanged, top tier performers are still with the firm. Sounds like an intelligent business model.

Positioning:

We’re making a rather large jump now we assume you know how to do work without making major errors. It’s time to strategically drop quality by ~2-4% on the lower ranked managing directors and increase quality on the higher ranked managing directors by ~2-4%. This is going to take serious concentration and will help you immensely.

For investment banking this means you have a few extra formatting errors on your low level work and for the high up MDs you have none. For Sales and Trading this means you are slightly faster with your requests from the top S&T MDs and for Equity Research this means a mix of quicker speed and quality of information and data requests. As they say, the devil is in the details.

Why would you do this? Well the answer is clear. If everyone else is trying to please every single MD with the same quality of work, you know with certainty that they are giving 9/10 work to everyone, instead you’re giving 10/10 work to some and 8/10 work to others. We’ve said it before and will say it again, what is everyone else doing… probably a bad idea.

Guess what will happen? Slowly you’ll end up doing more work on the right team.

The Transition:

You must be able to change gears if you hope to succeed long-term. Lets say you’ve correctly landed yourself more responsibility on the right team. Lets say you’re heading into that important annual review. It is time to listen to all of the criticism because if you don’t you’ll miss the train.

Here is the explanation:

At the bottom of the totem pole your movement to the next level is generally a function of likability and error free work. Make everyone like you within that team. There are no excuses, no matter how much you may want to kill that one Director or that one psycho Vice President… It is simply not worth it to lose the momentum you’ve created.

With that said, the best time to find your weak political spots is going to be… during your review. Take copious notes on any negative feed back and immediately triangulate who made the comments. Do not shirk on this step or you will regret it. This is because your life is going to be chaotic at this point. Simplistically, if 8 people reviewed you at the end of the year, you need to be certain that person 1 and person 6 are the ones that made comment one and comment 4. Why? Now you can remember this specifically for their projects. No matter what, do not let this error occur again on their projects. Everyone makes mistakes, but you need to dial in on these comments to win their affection when it comes time for that promotion.

The Home Stretch:

So you have the office situation locked up like a death row inmate. The key is to remain on the gas pedal and continue to ask a smart questions once in a while and receive minor actionable feedback. Why would you do this? You’re validating their belief that they are good leaders. Again this is not about you, no one cares about you, this is about slight nudges of validation after you ask an innocent and intelligent question. Here is the example unrelated to Wall Street.

You want to gain a few pounds of muscle but you’ve hit a plateau. You read a few books and still can’t seem to jump the gap… You find someone who has done this before. You contact. No answer. You contact again. No answer. You contact a third time and the person finally answers.

“I know you’re a busy person and I have been researching this topic for a few months and learned xx and xx, to cut to the chase I’m trying to gain another 5 pounds and have hit a plateau. Would you mind sparing me a few seconds so I can troubleshoot the issue”

Guess what, you’re going to get an answer and then they are going to hang up. 9/10 they are hoping you don’t contact them again because they are extremely busy and don’t have time to waste. 2 months go by. You send them the following

“Didn’t gain just 5 pounds of muscle, gained 10. Thank you for everything. (attached photo)”

Want to take a guess if this person will be willing to help you again?

Comments

  1. IB Analyst says

    Wow, wish I had this post before I joined. Made some errors based on this, I was in the please everyone camp. Thoughts on what to do if you were ranked in the middle of the class instead of the top for political reasons?

    • Wall Street Playboys says

      Depending on how bad the political situation is you could either 1) try to slide onto a team with no assigned analyst (ie: one group with a heavy hitting team doesn’t favor any of the analysts) or 2) switch banks as a lateral.

      If you can slide under a top MD who won’t promote you at least you will have a higher ranking and be able to recruit for PE/HFs. If you think this is impossible it is better to lateral over to a larger bank. This way you can start fresh and appropriately align yourself with the right MD.

  2. BackOffice Slummer says

    What if you work in backoffice at a really big hedgefund, who should you please if anyone? Most of the guys around me have been here since this companies inception and look like they are just waiting to be replaced, any advice and this is not what I want to do but the companies prestige is too high to give up doing backoffice work even though I want to do a more active research oriented role.

    • Wall Street Playboys says

      None of our writers have made the jump from back office in a Hedge Fund to front office so unfortunately we can’t help, you’re best served finding an individual who has done so.

      With that said, typically the move from a back office accounting role to get into Wall Street front office roles is to jump to up a tier to level 2/3 as noted in our navigating Wall Street post. Many also go from accounting to business school to Investment banking.

      Unless a specific PM wants to add you to his team your current set up is a long shot because there are hundreds of people applying to the same position with resumes that already have Wall Street backgrounds. Place your shoes into those of the hiring PM.

      Would you hire an accountant with no experience investing in securities or someone with 2-5 years of experience…

      So either 1) hope and get lucky by getting a PM to like you or 2) find an entrance into a lower rung on the Street and work up.

      • BackOffice Slummer says

        Im non-accounting, just basic excel monkey work but it pays good, so all this accounting advice does not apply :/ and i havent heard of anyone moving from backoffice to front except a few guys who ran P&L and eventually became traders (had good connects too i’m guessing)

  3. Josh says

    This post needs to be read in every single college nation wide. Politics are just as important as job performance. You can’t have one, you need to have both.

    • Wall Street Playboys says

      Missed this… You probably figured it out by now, it is simply an add-in that you can choose when flipping through the twitter installs

  4. Woke up says

    I came to this blog a week ago, via B&D or Dangerandplay, when browsing game stuff. I am the poster boy for an archetype you mentioned in an earlier article about dicking around in college and having no focus. I work for a recruiting agency that supports multiple buyside firms on every functional, non-revenue producing job. Basically, we cover any role that makes the front office’s life (you) easier so I continued to read because of the domain alignment and need for a stronger understanding of capital markets lingo and culture. I have begun career change because I recognize that the current business model is too far out my control unless I want to commit 10+ years to the profession. It’s actionable, fills a huge need, and comes natural to me, advertising.

    After reading above, you’ve done three things:
    1. Smashed my perception of Wall Street Professionals.
    2. Hooked me. I came for the pussy advice, I’m staying for the value.
    3. Increased my confidence in America.

    So in other words, you bring massive value to us non-finance types as well.

    Thanks.

    • Wall Street Playboys says

      Cool, if you have questions don’t be afraid to ask we’re happy to help. See the ask us anything section.

  5. says

    I regret not stumbling across this article much sooner.

    I have relied on my social skills and likability for far too long. If I am going to make the next jump, from a front line manager to the manufacturing manager, I need to play ball.

    From a young age I understood who’s important and who’s not so I have that in check but my attention to detail is sloppy.

    I didn’t realise how making small mistakes can get irritating for the eagles of the company until a few weeks ago.

    My plan of attack now is to play it like a long chess game and not think with my tempter and emotions.

    Keep my mouth shut as Im a nobody yet, unless I have something clever to add to the situation, distinguish myself from the heard of losers, continue to be likeable, and be a professional.

    I really like this blog, even if some content doesn’t directly apply to me.

    Ant

    • Anonymous says

      Hi Ant,
      Would you please elaborate on how you distinguish the big guys?

      Much thanks for helping out the oblivious!

      • Wall Street Playboys says

        He will unlikely see it.

        1) does he travel a lot? Good sign.
        2) does he suck up to the head of banking? Bad sign.
        3) does he have problems getting HR rules to bend? Bad sign
        4) is he asked to screen all new revenue generating employees? Good sign
        5) how many transactions has he closed? More is always more.

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