Thursday, May 28, 2009

Why Firms Must Sell Themselves

Who has the edge in the current finance recruiting marketplace? The newly graduated? MBA hires? Or banks, private-equity firms, hedge funds, asset managers? Or the Federal Reserve Bank and U.S. Treasury? Most will contend financial recruiters have the upper hand--whether for entry-level positions or mid-career posts, especially in an environment where hundreds chase a handful of open slots. But do they?

On paper, banks and investment firms no doubt have an advantage. Countless people are looking for fewer open spots--particularly at mid-level and senior positions. In some instances, firms have received over 1,000 resumes' for a single role. With these numbers, they can pick, choose and select whom they want--and when they want and how they want. They can rush the process, or they can (as many in the market will tell you) take their time, be deliberate and choose on the basis of odd, unusual criteria. (The demise of Lehman and Bear Stearns and the troubles of others enhanced that upper hand.)

But the dynamics might be slightly different for BA's and MBA's in the first stages of a career.

The number of first-year spots have declined at banks and funds, as these firms have restructured and pared down because of less activity, a slowdown in deal flow, or the outright shutdown of certain busineses (mortgage securitization? new derivatives products?). But the same firms worry that the number of people pursuing finance might have declined since last year and may continue to decline in the year or two ahead.

More important, they worry that the number of extraordinarily talented people will go elsewhere. They are comforted by large numbers from which they can choose, but will be concerned that exceptional people might not bother. It wasn't long ago when a fifth of students in Ivy League colleges were interested in Wall Street or when 20-25% of students at top business schools had an eye on a career at a Morgan Stanley, Blackstone, Goldman Sachs, Citadel, D.E. Shaw, Lehman, Merrill or KKR.

Big banks always prized themselves on hiring exceptional talent, because they contribute immediately and are productive right away. Top talent can:

(a) hit the ground running and get immersed in live deals or transactions in no time,
(b) learn new material and master it in days, no matter how little experience or exposure they may have had beforehand,
(c) do in-depth, useful research almost overnight on any relevant finance topic,
(d) produce astounding models, analyses, and presentations in a short period of time--material that will be stimulating, penetrating, profitable (of course) and immediately beneficial to clients,
(e) add creativity and special insight to new products, new transactions, new clients, new industry groups, etc.,
(f) execute and be productive with an uncanny ability to get things done swiftly and with unusual levels of energy, and
(g) be role models and astute tutors for those who follow behind them.

Firms have always "catered" to the exceptionals by giving them responsibility and compensation (and of course an unrelenting heavy workload). (Unfortunately sometimes how a fraction of new talent gets classified as "exceptional" or "extraordinary" might be subjective and political, especially when for years almost all entry-level talent was excellent.)

In essence, young MBA's can and did make a difference in getting the business, executing a deal in a creative way, making ground-breaking presentations to clients or executing a unique trade.

In years past, Goldman felt comfortable it could attract the top students in finance from, say, Darden, Ross or Tuck. Or Morgan Stanley felt it could convince a top student from Stern to accept its offer over one from the Federal Reserve. Lazard and Blackstone knew they would get the best and brightest from Wharton or Harvard. The same firms will want to continue the pipeline of top talent.

Today, that top student may have second thoughts, as he/she first tries to scope out the finance landscape in the years to come (Will the firm still be around in five years? Will new bureaucracy at banks stifle creativity?), tries to assess work-life balance, and wonders whether he/she will be able to contribute in a different financial environment.

Also, that top student may be wooed away by a more attractive and just-as-intellectual experience by the U.S. Treasury, Federal Reserve Bank, the SEC, or by a more interesting (and less stressful) entrepreneurial experience on the West Coast.

They worry this group might be lured to other professions with nothing to do with finance. A decade ago, dot-coms lured them away. Now even the arts, sciences, or government service could lure them away.

Thus in the coming year, banks and investment firms won't bask in the glory of being able to pick and choose as they please. They will revise, update and spice up how they present the "attractions" of financial services, corporate finance, sales and trading, and private equity. They will fill their quota in hiring easily, but want to be assured they still get their fair share of exceptional talent--talent that made a big difference in deals, transactions, analyses and client presentations in the years before.

Tracy Williams

Thursday, May 21, 2009

Cornell Makes 15

The Consortium announced this week that Cornell's Johnson School will become its 15th school. The Consortium adds yet another top-tier school, expanding choices for top-notch potential applicants. Yale joined the Consortium last year, and its first group of Consortium students start this fall.

Adding another top school will likely increase Consortium applications, as this attracts talented applicants who otherwise pay more attention to such non-Consortium schools as Wharton, Columbia and Stanford. This makes it even harder for the best students across the country to ignore the Consortium experience, network, fellowship, and a larger slate of just-as-good business schools, such as Cornell, Dartmouth, USC, Virginia, Michigan, Yale, and others.

Adding another top school will also likely increase the total number of Consortium students. All other factors being equal, adding Cornell doesn't mean other schools will reduce their respective numbers.

By comparison, the Johnson School is not large--medium-sized by b-school standards, about 270 students in each MBA class, smaller than NYU, Carnegie Mellon or Michigan, but slightly larger than Dartmouth.

It has sponsored a notable pipeline of alumni to careers in finance, as expected with Wall Street being not too far away. The CEO's of Kraft and Sprint Nextel are Cornell MBA alums. And large numbers of senior bankers at Goldman Sachs, JPMorgan and Morgan Stanley went to Cornell. The current head of the Rock & Roll Hall of Fame in Cleveland is a Johnson alum.

Cornell no doubt helped its bid to become a Consortium school in part because of an exceptional emphasis on diversity. It maintains a highly regarded Office of Diversity and Inclusion--whose objectives and programs complement what the Consortium is all about.

Also worth noting is the fact that it graduated its first black MBA almost 60 years years ago, Wilbur Parker, class of '50, who after Cornell went into public service holding senior positions in the city of Newark.
Tracy Williams

Thursday, May 14, 2009

Transitions: Gaining an Edge

The marketplace is crowded, and blame the financial crisis; bankers, brokers, analysts, researchers, and traders are worried about their jobs, are out of jobs, or are concerned their number might be next.

What can you do to separate yourself from the pack, differentiate yourself, or gain a special edge?

At the Consortium Finance Network's second event, Charlotte Lee, lead consultant at global consulting firm DBM-New York, had a bundle of ideas, offered a slate of concrete suggestions, and shared stories of what works and what doesn't work when you are interviewing, networking, or simply transitioning from one finance sector to another.

Citigroup and its director of graduate recruiting Fatimah Gilliam hosted the session in New York May 13. The gathering included Consortium alumni, new and current Consortium students and other CFN members.

Because everybody has top-notch skills and good experience, because LIFO (last-in-first-out) is the rule of the day in many financial institutions, because there might be 1,000 resumes for one job, you must have an edge. You must find a way to stand out.

She suggested many pointers. In an interview or in a networking moment, the words (content, meaning) count for only 10%. The tone of voice counts 20%, while body language is 70%. Tone, presence and manner of speech help others remember you.

Lee encouraged the group to do the following while out in the marketplace: Always ask yourself: What motivates you? Money? Work-life balance? Creativity? Relationships?

Don't focus on your skill set. Focus on fit. Do you fit into a firm's culture, environment, work pace? "Can you get along well with others in the sandbox?" she asked. How you fit or whether you fit will determine whether you like a position and, too, do well in it.

If you perceive you don't fit or can't fit, then you probably shouldn't accept a position. If you are in a current position, you may want to move on.

How else can you set yourself apart? Lee's recommendations fell into two categories: personal and professional.

Having a personal edge ties to body language, personal appearance. "Almost like speed dating," she said. "Stay upbeat, smile, show enthusiasm for you can do and what you know."

Manage the icebreaker. Look for "mutual-interest intersection," she suggested. Find that common ground, whether it's school, hobbies, birthplace, shared acquaintances. Common ground breaks the ice, but also establishes a rapport and sets you apart.

In an interview or a networking meeting, "first impressions are last impressions." Manage your side of the meeting: "Have a strong beginning, a strong ending, and an ask (at the end)."

Having a professional edge means being "accomplishment-oriented." In resumes and in dialogue, highlight, summarize and simplify achievements, deals done, projects managed, costs saved, and revenues generated.

On the resume', Lee explained how the top and the bottom are the most read. Make sure they are strong, clear statements.

Stay current, highlight professional designations (CFA, CPA, Series 7, etc.), and make sure to "manage and expand your online presence." Make it easy for others out there to find you, but make sure they see the best of you.

In networking or in networking, Lee suggested, "Have an opinion and a solution (about current topics)....Bring the dead mouse to them (with an answer or game plan)." Others around you should see you as a resource. "Be seen as the go-to girl."

Polish that elevator pitch, she said. Get it down to three bullets about yourself and your career.

Make yourself known, do public speaking, or do volunteer work in the community or even in the industry. And make sure you present your complete self in Linkedin.

The session was spontaneous, interactive, sometimes humorous in the midst of uncertainty in the industry, but Lee was always honest, telling it how it is in these times.

Audience members asked many questions including those related to the difference between fitting in vs. separating yourself from the pack and the difference in cultures at banks vs. government institutions.

Others who attended are encouraged to share feedback here.

Tracy Williams

Tuesday, May 12, 2009

First Years: The Summer Before School

Banks (including investment banks, money-center banks, some boutiques and regional firms) have an unwritten rule (a truce, so to speak) that they not start formal recruiting of first-year MBA candidates for critical internships until after the school year starts. Internships are important, because banks use them as the pool from which they will make full-time offers. Some b-schools, in fact, don't permit banks and consulting firms to approach students on campus until well into the first year.

Orientation Program. Hence, banks do not do formal interviewing and recruiting at the Consortium Orientation Program (or other "pipeline" programs, such as Toigo or Jumpstart). They do, however, start sizing up potential candidates early, gauging whether candidates will "fit": Are they client-oriented, do they exude enthusiasm? Do they have in-depth interests or insight on banking topics? Can they "hold their own" in presentations, financial models, or debt-equity arguments? Do they bring something special to the table?)

At these summer sessions, there is no formal measuring of technical skills. But no doubt, they start checking intangibles right away.

The chance to prove technical ability will come later. Some banks presume a base level of technical competence from the sheer fact they are looking at candidates at top schools who have passed a first-level test by getting in. Some will interview carefully later to see how well candidates have learned b-school material in finance and accounting. Other banks put candidates through a tough technical drill, almost impossible to prepare for.

Interviews. As the summer nears its end, first-year students start planning "informational interviews" with contacts at the banks they are interested in. Information interviews are not formal, but new students use them to create a "buzz" about their candidacy.

They don't entail a technical evaluation. Often they will be with school alumni at the bank. HR people don't conduct them, but help arrange them. They are important, nonetheless. Banks will use those meetings to determine who will be placed on the preferred interview lists on campus. (For more, see Informational Interview I, II blogs.)

In 2009, the environment is different. In a less-competitive environment (as MBA students explore other options and after the departures of Lehman and Bear), banks will spend more time this summer and early fall convincing talented students that corporate finance and sales & trading are still highly desirable and rewarding paths.

They know they must sell students on banking, as they did in the early 2000's after the dot-com surge imploded. Students should listen to the arguments and weigh them against their inclinations to try something else.

Well into the first year, banks will have formal technical interviews, but after they have selected students for first-rounds. Getting on the coveted first-round lists is sometimes the hardest step in the initial phases (not the interviews themselves, some will say).

Late Summer. Over the summer, it might not help to worry about being technically ready. Students instead should assess which banks might be a best fit and start preparing by getting into a rigid process of keeping up with what's going in markets and products, among top firms, among potential clients. To say the least, be informed, be up to date, be confident, show insight and have a plan when school starts.
Tracy Williams

Monday, May 4, 2009

Rankings: Take a Peek, But Be Cautious

Another major publication (U.S. News & World Report) just unveiled its latest business-school rankings. If you look closely, they are hardly similar to rankings at other publications—most notably those provided by Business Week, the Wall Street Journal, and the Financial Times.

The best advice? Take a peek at rankings, but don’t get obsessed by them—whether you are applying, are in b-school or are an alumnus. Nonetheless, you may encounter a world or a culture (ours) that is fascinated with rankings, ratings and lists.

  • Consortium schools, on the whole, generally fare well. That Consortium schools aggressively seek students from all backgrounds and foster a diverse environment might be a contributing factor.

Rankings identify quality business schools that are “doing it right,” keeping up to date, accepting top-tier students and making themselves relevant. But the criteria can be a problem. They vary by publication. And even for the same publication, both criteria and rankings may differ significantly from period to period. It becomes hard to determine which ranking in which year is the fairest.

Rankings are controversial, but attention is paid to them—at least for a short period after they are publicized. Students and alumni in transition hope they add prestige and differentiation to a resume’. (And sometimes they do.) Other alumni care about them merely for pride’s sake.

  • Corporate recruiters pay attention to them, too, if only to narrow the pool of schools they can efficiently recruit from or draw the line above which they will focus recruiting efforts. In that respect, rankings are a planning tool, not a point of prestige or pride.
  • Deans may be forced to obsess over them, even if they don’t want to. Rankings might be one of the benchmarks for how they are evaluated. Deans, therefore, will be attentive to all criteria for which they can influence (students’ test scores, placement efforts, recruiters’ perceptions, faculty-student ratios, alumni giving, etc).

There are plusses and minuses when it comes to rankings. The minuses first:

  • Deans and school officials will inevitably focus on them, sometimes too much, because rankings may be a factor in evaluations or in how outsiders perceive their performance. That risks the leaders of b-schools distorting the basic missions of teaching students, increasing knowledge, contributing to global enterprise and promoting dialogue.
  • Deans don’t want to deviate from the mission, but they have constituencies they must respond to. They may need to explain a decline in ranking from, say, no. 7 to no. 13 in one year. Rankings will force them to care more about GMAT scores, the school’s perception from the outside, and the starting salaries of the graduating class. Caring too much about starting salaries might mean the school pushes students to work at hedge funds rather than in public service.
  • Rankings can also be unreliable, just when some feel the need to rely on them. Even Stanford might be rated no. 1 in one, but no. 6 or 7 in another. Or in the same publication, it might be rated no. 1 this year, but fall to no. 4 or 5 the next year.
  • Rankings might influence a prospect’s decision to choose one school over another, when the lower-ranked school is a better fit.

Beyond the vaunted lists of 1-50, there are some subtle plusses in the effort:

  • The exercise might highlight good, unheralded schools that, for some reason, exist (and thrive) outside the halo of a “Harvard-Stanford-Wharton.” For example, when rankings appear, we see Wharton on the lists, but we also see other outstanding schools such as Carnegie Mellon, Case Western, Vanderbilt and USC.
  • We may also see how some schools from year to year improve or deserve attention for special initiatives or novel changes in curriculum. Note how Yale last year courageously altered its entire approach, possibly setting a trend. The process can reveal how, say, Cornell, NYU, and Dartmouth are competitive and have sneaked into top-tier.
  • The exercise permits prospects to review and compare certain statistics if they need to. The criteria, however, are still based too much on narrow statistics (e.g., average starting salaries).
  • Publications tend to accompany lists with a general, somewhat thorough assessment of graduate business education, the curriculum, and relevance to global issues. They step back to report whether schools are preparing students for the next generation of corporate challenges (in management, technology, environment, globalization, and even accounting). In the latest, U.S. News analyzes schools’ efforts to increase female students.
  • No doubt for the next round, publications will ponder whether schools have “taught the crisis” sufficiently and have prepared students for a new landscape in finance (including regulation, risk management and recession-proof initiatives).
  • Rankings sometimes highlight schools that excel in a particular field: marketing, finance, international business, operations, etc. Schools with distinguished specialties can be highlighted—to the benefit of recruiters or prospective students. If Michigan and UNC excel in operations, and if NYU and Virginia excel in finance, the publications will say so. In the latest, Indiana is among top schools in accounting.

In sum, the best compromise would be for publications like Business Week and U.S. News to identify a class of top schools (say, top 25 or 50), all deserving of, say, a AAA-rating based on minimum criteria, but not ranked.

The problem with that is that doing that risks their selling fewer magazines. Rankings create mild controversy, which of course increases newsstand sales.

Tracy Williams

Saturday, May 2, 2009

The Informational Interview, Part II

Requesting an Interview in Person or by Phone

Bankers who grant informational interviews are generally willing to share 20-30 minutes of their time to explain their expertise in their field. Remember to be flexible in your scheduling, bankers are usually busy throughout the day. I found the best time to schedule meetings was between 5-9pm. If your prospective interviewee seems too busy to talk to you, ask a convenient time when you could call back to discuss scheduling an appointment.

Although there are many techniques to requesting the informational interview, the following are good approaches I used:

  • "Hello, my name is ____. I’m conducting career research in your field. I would like to meet and talk with you for about 30 minutes so that I can find out more about your field of expertise."
  • "Hi, my name is ____ and I’m a student at ___ University. I got your name from ____. You’re in a line of work that I’m interested in, and I was hoping that you could help me gain insights into the profession. I’m sure that my questions could be answered in a 20-30-minute informational interview."
  • If you prefer to arrange an appointment in person, recruiters (HR) are your best resource. They hold the key to getting inside the unit or section of that organization, if you do not already have an inside contact or referral. Ask them some of your questions. You will usually get good information. Recruiters know how things work, the names of key people, job requirements, etc. It is important that they understand what you want. If you ask them something that they feel could be more fully answered by someone else, they will usually give you a referral.
  • You can use your own creativity, but the most important thing is to emphasize that you are simply trying to get first-hand information, and whatever they share with you will be appreciated.

Most of the time, your prospective interviewee will be more than willing to take 20-30 minutes to answer your questions. Sometimes the person will want to talk over the phone, but often he or she will invite you to his or her workplace. When you can, schedule the interview at their workplace because you’ll learn more and make a stronger connection with the person.

Within a day, follow up with a short note expressing appreciation for the opportunity to meet, if possible, remarking on your continued interest, preferably with reference to something specific discussed in the meeting. This can also be a point to remind the banker about a referral you had requested.

A word of caution: Scheduling informational interviews early (June through Sept) has pluses and minuses. On the plus side, you begin to improve your network, knowledge, and ability to articulate your story that much sooner. On the minus side, those early contacts may have a harder time remembering who you are come December (remember the “A-List” in Part I). That said, I would follow up again with a second informational request closer to November and December. Just make sure not to ask the same questions over again. This would be the time to impress them and show what you have learned since your last conversation.

At the end of your informational, do not miss the opportunity to expand your network. Ask for a referral. If things went well, it is usually okay to say, “Is there someone else in your group you can refer me to?” or “Can you introduce me to X in Z group?” This simple move can unlock many doors.

Additional Tips and Resources

If your cell phone contract is almost up, or if you are thinking about upgrading your phone, invest in a Blackberry. It can be a time-saver. Sometimes your meetings need to get pushed up or down, or someone who wasn’t available beforehand, now has a 30-minute window to meet with you. Your Blackberry will make sure you don’t miss a beat.

Once you invest in a Blackberry, it’s usually not a good idea to write long emails to bankers. As a rule of thumb, if you have to scroll down to read your email on a Blackberry, your message is too long. Either way, get comfortable with the idea of never getting replies from bankers, or having to follow up several times just to schedule a meeting.

In Summary

Be prepared

  • Research and understand yourself (the best answer, not the first answer)

  • Be prepared to talk about everything on your resume

  • Do a mock interview

  • Understand the industry, company and job

Differentiate yourself from the rest of the candidates

  • Do so through stories and accomplishments

  • “Bullet-point” the answers to the questions, dig into the back of your mind

  • Ask good questions (Banking Tidbits, Part 2)

Make good first impressions

  • Dress professionally and appropriately

  • Travel light

  • Be on time!

  • Bring extra copies of your resumes, paper, pen and handkerchief

Most interviewers make their mind up within the first three minutes of the interview

  • Good eye contact

  • Warm smile

  • Firm hand shake

  • Good posture

  • Relaxed and confident
Show enthusiasm and focus

  • Focus on the positive

  • Think before you speak
  • Know what you want to get across and then do it. Memorize points, not passages. It makes your answer linear and you know how and when to end. The inability to end an answer can be fatal.

  • Maintain a sense of humor

Don’t forget to

  • Turn off your cell phone

  • Turn the interview into a conversation

  • Get across your main points before you leave the room

  • Write out questions you want to ask in advance

The Informational Interview, Part I

The Informational Interview, Part I
As is the case with anything that requires consistent effort and self-discipline, getting started on your summer internship search is the toughest part of finding your dream job. This summer many of you (especially career-changers) will wonder where exactly do you begin?.

Networking sounds like a logical first step. After all, networking means informing people you know—personally and professionally—that you are looking for a job. Let’s assume that you have become skilled at networking, and that you’ve established several career objectives (with a particular industry or firm in mind), the next step is informational interviews. They are an excellent way to expand your personal network and collect valuable information about a company or position that interests you. Also, they are important because they help gain internships, which help gain full-time offers upon graduation.

Two Types
Informational interviews can be used in two different ways: you can use the interview to get information, or you can use it to make an impression.

To get information, you need a basic understanding of the organization. This means doing some research on your own about the firm, and developing a good set of questions. I cannot over emphasize how important your research will be in developing insightful questions (Also read Banking Tidbits - Part II). Although it’s been said that informational interviews are considered a safe environment to ask questions, make no mistake that impressions are being formed very quickly about your knowledge, passion, personality, communication skills, and technical skills.

There are many reasons to conduct an informational interview. Here are a few:

  • You can evaluate your compatibility with the company by comparing the realities of the field (skills required, working conditions, schedules, culture, and common traits of the employees ) to your own personal interests.
  • You can determine how people in a particular business, industry, or job view their roles and future growth opportunities.
  • You can gain insight into the kinds of topics and concerns you might face in a potential job interview, and improve your interviewing skills.
  • You can get feedback on your relative strengths and weaknesses, and learn industry jargon.
  • You can expand your network, gather more valuable information, and learn of possible job opportunities.
  • This type of interviewing is usually acceptable after your first two-to-three months in business School. By December you should be more comfortable and able to have in-depth conversations with your contacts.
Make a Positive Impression
Try to schedule several meetings in person because putting a face with a name can be as powerful as the questions you ask. For example, I traveled to New York City five times from Bloomington, Indiana, during the first semester in B-School. This worked in my favor, as recruiters acknowledged the extra effort and cost associated with these trips. My willingness to travel allowed me to get more face time than some of my friends who were attending schools within walking distance of Wall Street.

Make sure if you are visiting someone’s office to dress as you would for a job interview. If you are meeting someone for coffee, use common sense, and dress to match. Specifically, if you are in New York, Chicago, or San Francisco and meeting a banker for coffee, I recommend wearing your interview suit. Also, offer to pay for the coffee. It’s a nice gesture. Chances are they won’t let you pay, but you should offer anyway.

When you are setting up your informational interview, make sure to find out with whom you will be meeting and their position or title. Google the interviewer to find out more information on him or her, including recent articles, or announcements of their latest business deals. This could help you develop a more targeted list of questions.

If you want to make a good impression, you need to have a solid grasp of the following:

  • Organization — Know the names of the key people and their titles, products, industries, recent deals, and the culture.
  • Questions — Have them ready (take a page from the trial lawyer handbook and know the answer – for the most part, to any question you ask); make sure you understand the jargon .
  • Group(s)Which one do you want to work in? Why you are passionate about the firm and a particular position? (Rehearse your story and elevator pitch; your answer to “Why banking?” should flow by this point.)
Again, regardless of which type of informational interview you are requesting, the importance of researching the industry and company cannot be over-emphasized. It’s critical to at least appear well-educated on the subject.

Bottom line: You want to be able to demonstrate a familiarity with the company’s activities, and with the current issues facing that sector (this will also keep the conversation going).

Ultimately, you are trying to impress them enough so that they will continue to refer you to others within the firm. You want as many VP’s and MD’s as possible pounding on the table and reciting your name when the company puts together their interview list (the “A” list). This typically occurs sometime in January.

Finally, when requesting an informational interview, make sure to tell your contact right away that you would like to learn more about their industry or firm, and that you will be the one asking all the questions. Most people won’t feel offended (especially once you assure them that you are not asking for a job), and will usually be more inclined to help.

If you tell a contact that you want advice, mean it. Also, unless specifically requested, sending your resume to someone you would like to meet for an informational interview will probably give the wrong impression. Have your resume handy, in case they ask for it, and be ready to talk about your past experience, if necessary.

All that said,
I encourage you all this summer to begin the process early, instead of waiting until school starts. If you would like additional tips to help you prepare for technical interviews, I encourage you to visit