Thursday, April 26, 2012
Finance professionals rush to see deal lists, underwriting rankings, league tables for transactions, M&A rankings or rankings of the best capitalized financial institutions. The list of business-school rankings can be useful, except what list is most reliable or captures the correct attributes of an MBA education? What list is updated and, beware, what list uses irrelevant criteria? There are many b-school lists--from the Economist and BusinessWeek to U.S. News, Financial Times, and (occasionally) the Wall Street Journal.
One current list always seems to be useful or eye-opening. Useful for business professionals to detect and evaluate opportunities. Useful in making decisions about where to pursue a career or where there might be, say, a legitimate chance for a woman to become CFO. Useful in determining what companies value input of all employees from all backgrounds. The rankings probably change with minimal variation from year to year. What better way, however, to determine more fairly whether companies are practicing what they preach or what they espouse in mission statements on the front of annual reports.
That would be a list of the top U.S. companies for diversity. Many magazines or organizations produce diversity lists from time to time--including Black Enterprise magazine. The latest list comes from the publication Diversity, Inc.--which this week produced its list of the top 50 companies in diversity (its 13th year). It also presented various subsets of the same--top companies in diversity for executive development, recruiting, culture, Asian-Americans, blacks, Hispanics and LGBT communities.
All lists purport to be (or pretend to be) the results of objective measurement and inputs. All lists present what they claim are objective criteria. The mere selecting (and omitting) certain criteria that they say will be used objectively is a subjective process. Thus, all lists are subjective. But where possible, readers can glean invaluable information or trends and find out what they want to know: Who's walking the walk, talking the talk?
In Diversity's list, financial institutions, particularly large banks, brokerage firms, asset managers and dealers, aren't prominent. That's not new. Most large, notable financial institutions have legitimate diversity programs and have made laudable efforts the past decades. Financial institutions, however, aren't necessarily pace-setters in diversity. They have been embroiled in turmoil the past years, and banks, insurance companies and broker/dealers continue to fight to survive, remain relevant and must navigate the burden of reams of regulation.
Let's get the criteria out of the way first. Diversity, Inc. used four primary criteria--CEO commitment, human capital, corporate communications, and suppliers. It sent surveys to over 1,000 participants and asked them to respond to a booklet (perhaps overwhelming to some) of over 300 questions.
In the latest list from Diversity, Inc., the accounting/consulting firms fare the best for diversity among financial services companies. Pricewaterhouse led the entire list, Ernst & Young and Deloitte squeezed into the top 10, and Accenture and KPMG are in the top 25.
Card companies American Express and Mastercard are also in the top 25. Insurance companies do well, too. Aetna, Prudential, MetLife, and AllState make the top 50.
One common thread among these names is that most have large, diverse bases of customers. Because those who purchase their products are diverse, they will be sensitive to, aware and respectful of the importance of diversity--diversity among employees and diversity in senior management.
Bank of America, Capital One, and Wells Fargo have the same--customers in the millions, branches in the thousands, a presence in just about every state in the Union, and an appreciation that all who use their services (mortgages, credit cards, wealth management, etc.) come from myriad backgrounds. All three make the top 50 in 2012.
Some prominent well-known financial institutions are missing: Goldman Sachs, Morgan Stanley, JPMorgan Chase, and Citi don't make the top 50. Indeed they are institutions that would happily participate in providing survey responses and aspire to be on the list. They likely took the time to fill out surveys and answer questions thoroughly and use the platform to boast about progress and special efforts (e.g., MBA fellowship funding for under-represented groups at JPMorgan and Goldman). Diversity, Inc. concluded they hadn't done enough, or other companies do more.
Many other finance firms won't be found, because they hesitated to participate, are embarrassed with their efforts, disagree with the idle exercise of surveys and lists, or deemed this is not a priority: hedge funds (Citadel), securities exchanges (NYSE, CME, Nasdaq), institutional trading firms (BCG Cantor, Jefferies, Knight), asset managers (BlackRock), retail brokerages (E*Trade, Scottrade), and private-equity firms (Blackstone).
Some of the same above don't have the required 1,000 employees to be included. Some are "all right" with diversity or will proclaim they are '"for it," but haven't devoted resources, energy or passion. Some might argue they have legitimate programs, but don't think it's necessary to flaunt their efforts by devoting resources to complete pages of survey questions. Most firms, however, will bother, because they don't like the market penalty they risk taking (among customers, especially), if they are not on the lists.
(Note, too, the prominent absence of technology companies Facebook, Apple, Google, and Microsoft.)
Pricewaterhouse and Ernst & Young were highlighted for recruiting and retention and promoting women into executive positions. Deloitte was noted as a top firm for Hispanics, while Wells Fargo was cited as the best in community development. American Express is in a top 10 for developing women for senior roles.
Consortium sponsors do well in these surveys and lists. That's no accident. They include past and current sponsors (including financial-services companies American Express, Deloitte, Wells Fargo, Bank of America and KPMG). The same resolve they have in sponsoring and recruiting from pipeline/inclusion programs such as the Consortium (and Toigo, SEO, MLT, and others) is the same resolve they have in promoting employees, developing senior managers and celebrating the differences and input from people of all backgrounds.
Tuesday, April 17, 2012
|NYU-Stern graduate Daria Burke|
Burns, Jung, Nooyi and others preside over companies, business sectors, geographic units, corporate brands, major subsidiaries and functions in finance and treasury. They would also be women from who hustled, regrouped, paused to raise families, scratched, climbed and willed their way into top spots, board rooms and significant leadership positions. Their few numbers, while growing, suggest there is still a ways to go. Those in CEO roles, such as Burns, Nooyi and Jung, are known and are seen commanding the podium at shareholder meetings or outlining strategic plans in a broadcast on CNBC.
Those below the CEO rung may not be as widely known outside of their industries and are not prominently profiled in the business media. As such, they aren't presented as role models as widely as they could be--especially as role models for younger women contemplating a similar corporate-ladder climb or a long-term career in business after the MBA.
That's where Daria Burke, a Consortium alum and MBA graduate from NYU-Stern, stepped in. She is doing her part by establishing a network of black women with MBA degrees, with corporate promise and with the resolve to succeed in business. Earlier this year, she and others established a new group, called Black MBA Women. The group has its own website and Linkedin group.
Burke wanted the group to go beyond sharing experiences and expertise about business opportunities in a network forum. She also wanted network members to learn about, study and follow the career steps of other successful black women in business. For many black women at or near the top rungs, there are lessons that can be shared or advice that can be exploited, based on their experiences.
Hence, the group will present and highlight success stories to share with members. It will spread the news and show what has been accomplished by black women in senior business positions, whether they were CEOs, CFOs, or heads of international marketing and sales, legal and compliance, client relationships, Europe subsidiaries, Asia expansion, risk management, technology and systems, or human resources.
The new group's mission is "to reinforce and create a strong network of African-American women with top MBAs." The group will try to influence and encourage younger professionals and students and "empower the next generation of young black women by increasing their access to education and business networks." Hence, identifying role models, presenting the profiles of women in senior roles, and heralding their achievements are primary objectives.
Burke says in the website she was concerned about the "staggering number of African-American girls and post-collegiate women" who don't know about the business successes of black professional women with MBAs from top schools.
She said this week, "I was truly inspired to create this organization by my personal network and by all the young ladies I meet and speak to about going to business school." She added, "I've gotten a wonderful reception so far and am grateful for the support."
Since graduating from Stern four years ago, Burke has worked in various marketing roles--her specialty. She is currently Director of Makeup Marketing (North America) at Estee Lauder, steadily rising into roles of greater responsibility and impact. At Stern she was a student leader in the school's Association for Hispanic and Black Business Students (AHBBS). Today, she is the head of that group's alumni group and decided, along with others, they can do their part to support black women MBA students and alumnae.
The group's website features "Power Profiles" that highlight the business accomplishments and career paths of black women in senior business roles. They include Tracey Travis, the CFO at Polo Ralph Lauren, who has an MBA from Columbia. Ursula Burns, Xerox's CEO, is featured with a profile that highlights her engineering background. Burns used her undergraduate and graduate degrees in mechanical engineering to launch a 32-year (thus far) career at Xerox. She was named CEO in 2009.
Edith Cooper, global head of human capital management at Goldman Sachs, also profiled, started out in the firm's energy group and now manages all facets of the firm's recruiting efforts and diversity hiring. Cooper received her graduate business degree from Northwestern-Kellogg. Rosalind Brewer, CEO at
Sam's Club, is featured, as well.
As Burke hopes to show, dozens, hundreds, if not thousands, of young students may not have been aware of the women in these roles, the bottom-line responsibilities they have at large, major companies, the quiet, effective influence they have in diversity initiatives, and the impact on younger women just from being in the position.
Burke encourages women to join the group as members on the website or via Linkedin.
Tuesday, April 10, 2012
|Tuck: Over 2,700 applications for just 250 spots|
How will the Class of '14 be different? How will it be like others? What do members of the class hope to achieve from two years on campus?
The application numbers and statistics are likely similar to those in recent years. At selective schools from Harvard to Haas at Berkeley and from Chicago to Carnegie Mellon, gaining an acceptance letter for a spot in the first-year class is still a hard task and the result of perhaps a half-year process of securing recommendations, writing essays, taking tests, visiting campuses, expressing interest and trying hard to be patient and hopeful. In recent years, NYU-Stern and UC-Berkeley have accepted just 15% of all applicants for full-time programs. Over 4,000 apply to Stern; over 2,700 each to Michigan and Dartmouth-Tuck, which accept fewer than 18%.
Total applications across the country fluctuate somewhat from year to year. A dismal economy or financial crisis, such as what we've endured, with irony sometimes sustains the aggregate applications number. Young professionals may choose to wait for a recovery while in the classroom or to transition from areas with little opportunity to areas of growth.
Market conditions, the economic environment, past personal experiences, the general outlook and total costs: All are factors that influence who return for the MBA, where they choose to attend, and what they hope to get from a rigorous, grinding experience.
Is this year's class more interested in unconventional segments, start-up situations or small boutiques, or do they prefer the formal tracks from an experience at Goldman Sachs or McKinsey?
This year's class, just as those who matriculated in the past three years, is familiar with volatility. They know volatile markets, but they are also acquainted with volatile opportunities and even a volatile, teasing, uncertain recovery. Thus, they will approach the business-school experience, knowing they must be flexible, realistic and willing to explore something new and different.
They may write in admissions essays they hope to pursue consulting, investment research or brand management, but they know the environment may force them or even encourage them to change their minds and pursue start-ups, community activities, or even industrial management. They may tell admissions officers they hope to work in New York, Chicago, or San Francisco, but two years later may accept job offers in Indonesia, Ghana, or Boston (as even some recent Consortium graduates have done).
A current student may have her eyes on an associate position at Morgan Stanley in M&A, but she won't be close-minded and will consider opportunities at General Motors, Google, Pfizer or even the World Bank or Zynga.
Those who went to business school until the late 2000s to study finance, especially those who attended known, reputable institutions, could almost chart and measure their ambitions. They could make a conscious decision to go into consulting, investment- or private-banking, trading, research, venture capital or private equity; they could proceed through a check-list of to-do's to get from school to a cubicle at Carlyle, Blackstone, Wells Fargo, New York Life, Goldman Sachs, Bank of America or a hedge fund in Chicago or Greenwich. They could expect to stay put for about 5-10 years, or at least until a vice-president promotion.
In 2012, the current classes approach the finance landscape differently. Someone just admitted to the business school at UNC, UVA or USC may visualize and dream of being in private banking at UBS or in investment management at Aetna , but won't slam the door if a San Francisco-based start-up turns him on to a role in corporate strategy or if a pharmaceutical firm invites him to work in its venture-investments unit.
Business school in 2002 might have been a springboard to a lucrative spot at Morgan Stanley or McKinsey, if the student studied hard, learned a lot, kept up with markets and played the recruiting and networking games astutely and unrelentingly. In 2012, business school still provides an entry into the most coveted spots in banking, finance and investing, but this crop of students will be happy to explore something they never considered, if the opportunity makes sense, allows for rapid personal growth, and offers something on the long-term horizon.
Thus, within the ranks of the Class of '14, there will still be large numbers interested in corporate finance, interested in spots at Goldman, UBS, Barclays, Paribas or JPMorgan, and willing to pursue investment banking, equity research or bond trading in the new, highly regulated environment. There will still be more than a few interested in consulting at McKinsey, BCG and Deloitte.
Yet there will be quite a few who will change their minds in school, will discover a pursuit more pleasing, will choose not to to go through marathon-like motions to chase a Wall Street dream job, or will learn they prefer strategy, operations, marketing, product innovation, and distribution more than investment analysis, corporate finance and capital markets. The top banks, firms and funds won't have trouble finding attractive candidates, but a coveted offer from Citi, Booz, or Merrill won't be the be-all or end-all.
Thursday, April 5, 2012
|Consortium Alumnus Boomer|
Despite the hurdles (raising new capital, navigating regulatory requirements, winning new business and mandates, and gaining trust among trading counterparties), women and minorities continue to test opportunities to do it on their own.
In recent weeks, Consortium alumnus Allan Boomer decided to step away from an apparent secure environment of a large financial institution and start his own asset-management company. Boomer has gained approval from regulatory bodies and has opened the doors to his new firm, Momentum Advisers. The firm will focus on investment advisory and financial planning.
Boomer is an MBA from NYU-Stern and was affiliated with both the Consortium and Toigo. Before he made his move, he studied his chances and the market landscape, assured himself that certain contacts and clients will follow, brought in other partners and expertise and courageously made the move. Boomer had clients, contacts, experience, pedigree, and investment knowledge, but the hardest part of the effort may have been to make the decision. After the decision, he then had to comb through a maze of registrations, compliance and regulation, and choose securities-clearing partners. At the same time, he had to convince clients to follow him and announce that Momentum was open for business.
Years ago, before the move was more a long-term dream and after NYU, Boomer worked on Wall Street into various roles, starting at Merrill Lynch. He soon departed for Goldman Sachs, where he worked for seven years and eventually became a Vice President in Private Wealth Management with clients, products, a global network, and hundreds of millions to manage.
At his new firm, Boomer will start with 15 clients (institutions and individuals who meet his current minimum requirements) and over $30 million under management. He says he hopes to reach $100 million under management in three years. Michael Glickstein, also an NYU-Stern MBA, will be a strategic partner in the new firm. Jontue Long will join him as an investment advisor. Rudy Cline-Thomas will also be a strategic partner.
At Momentum, Boomer and his partners hope to increase assets under management not only by importing old clients or contacts, but growing in other niches. For example, the partners plan to tap into money management for corporate executives, athletes, and entertainers. Boomer spoke about managing money and affairs among sports stars at a conference at Wharton last December, hosted by its African-American MBA Association. He formally announced Momentum was open for business a few weeks ago in New York City. The group still must hustle and compete in a grinding, tough business, but Boomer and partners are anxious, excited and hopeful.
To learn more about Boomer's firm, go to www.momentum-advisors.com, or contact him directly in LinkedIn.