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Case analysis :
SG Cowen New Recruits
In partial fulfillment of the course on Managing People and
Performance in Organizations
Submitted to: Prof. Ravi Kumar
12/3/2012
Submitted by
Harsha Jyoti Malviya (1211343)
Ishan Vishnoi (1211346)
Karthik P (1211347)
Kavya Gollavilli (1211349)
Koneti Nishitha (1211350)
Rajani Ch(1211368)
Ritesh Yarlagadda (1211372)
S.Sairam(1211376)
Soumya Basu (1211385)
Introduction
SG Cowen is a financial industries firm based in the United States. The firm is
looking to recruit for its Associate program. The case outlines the methods,
process and decision criteria that the company uses to arrive at the final
decision. We have studied and assessed these processes, criteria using the
models from the course book and material and have suggested improvements
wherever possible. We have also designed a linear model that will allow the firm
to standardize and quantify the various criteria it uses in its hiring decision.
Using this linear model, we have assessed 4 candidates that the firm is looking
to hire and pinned down the 2 most eligible candidates
was also believed that the associates and senior associates will be more in tune
with the requirements of the job and will be more rigorous in assessing the
skills. There were two rounds of interview conducted and finally 3 candidates
were shortlisted from the school.
Some decision points which are considered in this stage are:
Does the candidate have the required skill set for the job? - The
associates and the senior associates tested if the candidate was
competent enough to be a part of S G Cowen. As the banking sector
required specific skills, this was an important criterion.
Is there a cultural fit between the candidate and the company? - Chip Rae
believed that having a cultural fit was more important than a person who
lacked a bit in the skills. The cultural fit included things like if the person
will be able to devote the long hours, to forego a social life and be able to
adjust to a new location.
Stage 3 - Super Saturday
The 30 students who were shortlisted in the on campus round were invited to
the S G Cowen office for the final interviews. These interviews were conducted
by the senior employees of S G Cowen. Each candidate had to go through five
interviews and each interview lasted for almost half an hour. The major decision
points which were considered while evaluating a candidate were as follows:
Do they demonstrate a pattern of success in their past life? - Schoenberg
believed that what a candidate has done in the past did not matter much
in choosing the ideal candidate. It was very possible that a person had a
different career choice before, but he excelled in whatever he did. Such a
candidate proved to be a good candidate.
Will they really love working at S G Cowen? - Fennebresque, the CEO of
the company, believed that it was essential for a person to like what he is
doing in his job. A person might be good at something, but if he doesnt
like it, then there is no point in him doing the job.
Are they interested in technology and emerging markets? - S G Cowen
was a boutique firm which focussed on technology and emerging markets.
So a candidate which had an interest in these areas proved to be an asset.
Will they be committed to the firm and be loyal to the firm? - In the
banking industry, the company used to have high turnovers as many
employees used to shift to a different firm. So, it was essential to have
people who were loyal to the firm.
Do they have good interpersonal skills? - The work required the
employees to interact with clients who were looking for a person with
energy and enthusiasm. Thus, interpersonal skills became an essential job
requirement.
Will they be good team players? - The life of an associate was strenuous
as he had to spend long hours at work. Most of the deals were the result
of team activity and so, good team players were needed.
Are they mature in their judgements? - Since most of the decisions taken
at S G Cowen involved a lot of risk and responsibility, the candidates were
expected to show maturity in their judgements
Are they technically sound? - In the banking industry, it was very essential
to have knowledge of core finance concepts. Most of the decisions taken
were based on analysing financial data and making specific models.
Hence, the candidates needed to have strong technical skills.
Are they flexible and versatile? - Due to the inherent uncertainties of the
job, the candidates were required to be flexible and versatile
Informal Interviews
SG Cowen used informal interviews to gauge the interest of students in their
firm. Each core school had Team Captains who would usually be the alumni of
these schools and were responsible for interaction with the candidates. This was
extremely beneficial as it gave the students a chance to learn about the banking
industry. However, students at non core business schools did not have such an
option and had to approach bankers themselves for conducting these
interviews. This process was difficult and cumbersome as usually the bankers
would have extremely busy schedules. As described by Schoenberg, SG Cowen
was not very receptive to the people from non core business schools. The
process of informal interviews might thus create an undue advantage to people
from core business schools.
Also, the team captains are not human resource professionals and thus may end
up testing only skills and not personality. This might lead to bias creeping in the
process as the team captains might be selecting candidates on few
characteristics and thus stereotyping the candidates. The involvement in
recruiting activities was taken into consideration in the performance reviews
which decided year-end bonuses. This might be an insufficient motivation for
the team captains.
On Campus Round
Two rounds were conducted in campus. The first round was usually conducted
by associates or senior associates. Candidates were also tested for cultural fit in
these interviews. This helped to select candidates who would be able to work
efficiently and satisfactorily in the organisation. At the end of the first round
interviews, the two or three people who were interviewing candidates discussed
their observations about the candidates and compared their notes about the
different candidates. They had a fixed number of candidates to be chosen after
this round, ie, 6. The focus of interviewers was to quickly conduct a second
round so that they could be conducted on the same night for the 6 shortlisted
candidates. Ideally they should allow time between the two so that the
candidates are relaxed and at ease to give their best. Also, having a fixed
number of students whom they want to forward to the next round might result
in losing out good candidates or selecting not so good candidates.
Super Saturday - post lunch process - collective decision making
The collective decision making process lacks a proper structure. The process is
more qualitative than quantitative. The process relies on the recruiting skills of
the bankers who are more suitable to evaluate the job talent of the candidates
which forms only a part of the objective of recruitment process. One managing
director gets turned off by the salesy nature of the candidate while another
feels that he is eager to contribute and has a great attitude. When there is
Chip Rae will collect the votes and the results shall not be announced
immediately but shall be withheld till discussions on all 30 candidates are
completed. At the end of all the discussions, the candidates will be ranked
according to the number of yeses they have received and the top 20 shall be
given the offers.
Some additional features that can be added are:
Instead of the 5 interviewers presenting their views within the group, Chip
Rae can himself present the views without revealing the names of the
interviewers. This will reduce the chance of other members of the group
being biased by the source of the feedback (boss, subordinate, same team
etc)
Chip Rae can take the initiative to lead the group discussion. According to
researchi, one of the most powerful methods to improve decision making
is simply to make group members consider the opposite of what they
are thinking. This has been found to reduce errors in judgement caused by
biases.
Testing cultural fit at the first stage
The firm followed the practice of interviewing candidates for cultural fit in the
first round by asking questions about work and education experience and this
was used as one of the criteria for eliminating candidates. Research findings ii
have exposed the myth that companies that screen for values have better
performance than those that screen for intelligence. The research suggests that
though culture is a good determinant of job satisfaction and longevity in the
firm, it has low correlation with job performance. Moreover, given that the
industry in question here is banking which involves complex skills, we believe
that cultural fit should be given secondary importance and should be done at a
later stage in the process.
Overall positives of the S G Cowen hiring process
They hold their interviewers responsible for the quality of candidates they
bring thus ensuring that only the best candidates come to the firm.
It was made sure that the bankers were not partial in their selection
process and favouring candidates from their own alma maters though its
not mentioned how.
They looked for the right people with the attitude to work at SG Cowen
and were willing to go the extra mile to create jobs for them if required.
Making sure that candidates are relaxed and comfortable before Super
Saturday.
They did reference checks with previous employers and ensured that
candidates gave the right information.
One gap we find is that the process is fraught with uncertainty about
whether the candidate will accept the offer or prefer another firm. They
need to have an alternative in place so as to mitigate this risk. And the
recruitment process is also sandwiched into a very short time frame and
this will cause a lot of stress both for the interviewers and the
interviewees. Given that the firm is very particular about cultural fit,
initiative and on the job learning and they are inviting all shortlisted
candidates for a Super Saturday, SG Cowen can try to create an
Assessment Centre for the candidates in the long run.iv Assessment
Centres can provide a more comprehensive and balanced view of the
suitability of a candidate for an organization. They can design exercises to
simulate the key characteristics that they are looking for in candidates
and this will eliminate the subjectivity in the process. Since performance is
measured in several dimensions and several candidates are assessed
together to allow for interaction, it would facilitate better comparison of
candidates potential.v
A student who comes for a summer internship works in the organization
for 2-3 months. During this period, the organization can judge the
candidates skills, cultural fit and future potential and hence the firm can
make a better decision on hiring for a full time position. The students who
intern at SG Cowen has 2 months to understand the culture of the firm
and hence can make an informed decision if they want to pursue a career
with the firm. So the acceptance rate will be much higher compared to
that in the case of new recruits. The current number of associates hired
from summer interns is 8. This can thus be increased in the future.
MBTI to assess work ethics and personality type
While a lot of emphasis is laid upon personal fit in the organization, it is
quite difficult to gauge a persons fit objectively. To eliminate any
discrepancy and to scientifically analyse a prospects work ethic and fit,
we could have them answer an MBTI. The MBTI is a standardised test and
we have results from past tests to guide us in this regard. Study of a
number of Investment Banking personnel profiles has revealed that
Investment Bankers typically fall into one of these personality types: INTP,
INTJ, ESTJ, ENTJ, ISTJ.vi
Based on the information given in the case, we have evaluated the importance
of each criteria and we have given the following weights for each of the criteria
Category
Weights
Commitment to Firm
10%
Judgement/Maturity
Interpersonal
Impact/Presence
Communication Skills
Leadership
Initiative
Motivation
Technical
Creativity
Modeling
Accounting/Finance
Prioritizing
Work Ethic
Team Player
Flexibility/Versatility
Motivation
10%
5%
8%
7%
8%
7%
7%
12%
6%
7%
7%
6%
Technical Skills: We have given this the highest weight. Investment banking is a
skill-heavy job and firms are fighting for candidates with high technical abilities.
Given that SG Cowens core competency and competitive advantage comes
from research, technical skills should be given the highest weight (32%).
Work Ethic: SG Cowen is a boutique firm. Because of its small size, its associates
usually work very closely with firms and they need to demonstrate good team
abilities and flexibility as they are given high responsibilities and very little
hand-holding. Also very important is the fact that the candidate must be
motivated to join the company as if a person rejects the offer after being made
one, then the company has committed an error. We have given this a weight of
20%
Leadership: The importance of initiative and drive is expounded by various
senior members in the firm. All of them unanimously feel that in a field like
Equity Capital markets, it is very important to have the drive to learn on ones
own. They also talk about the importance of being a self-starter in a small firm
like SG Cowen (15%)
Interpersonal Skills: SG Cowens associates work very closely with clients, often
taking on huge responsibilities that they would generally not take on at other
firms. Also, they need to frequently interact with co-bankers and managers as
this is a collaboration-intensive field of work. We have given this a weight of
13%
Commitment to Firm and Judgement & Maturity: As stated earlier, it is very
important to retain talent in the investment banking industry where there is
dearth of the right talent. Also, there are a lot of situations in I-banking where
bankers need to use their judgement to make a decision. We have given both of
these 10% each.
Parameter
Commitment to
firm
Judgement/
Maturity
Interpersonal
Skills
Impact/
Presence
Communication
Skills
Leadership
Initiative
Motivation
Technical Skills
Creativity
Modeling
Accounting/
Finance
Weights
(total 100)
Natalya
Godlewska
Martin
Street
Ken
Goldstei
n
Andy
Sanchez
10
10
7
8
9
8
9
7
9
9
9
9
7
7
5
10
5
5
5
9
5
5
12
10
Prioritizing
Work Ethic
Team Player
Flexibility/Versatilit
y
Motivation
Overall Rating
7
6
7
5
7.07
5
5
5.9
7
5
6.59
5
6
6.88
Appendix
Scorecard for Natalya Godlewska
Natalya Godlewska
Commitment to
firm
Judgement/
Maturity
Interpersonal
Skills
Impact/
Presence
Communication
Skills
Leadership
Initiative
Motivation
Technical Skills
Creativity
Weights
(total
100)
10
10
Mar
ks
Remarks
Outstandin
9 g
Reasons
Called the bankers she had met at
presentation for informational
interviews
7 Good
Unsatisfact
1 ory
4 Fair
Outstandin
9 g
Outstandin
8 g
5 Fair
Modeling
Accounting/
Finance
Prioritizing
Work Ethic
Team Player
Flexibility/
Versatility
Motivation
Overall Rating
Outstandin
10 g
12
6
Outstandin
10 g
5 Fair
7 Good
7
6
7.07
7 Good
5 Fair
Martin Street
Commitment to
firm
Judgement/
Maturity
Interpersonal
Skills
Impact/
Presence
Communication
Skills
Leadership
Initiative
Motivation
Technical Skills
Creativity
Weights
(total
100)
Mar
ks
Remarks
10
Unsatisfact
1 ory
10
7 Good
Reasons
Though he said he preferred the
boutique nature of S G Cowen, it was
not sure if he would accept the offer
if made
Having served for 4 years in the
military, he was expected to show a
high maturity level
Outstandin
9 g
Dynamic Personality
Outstandin
9 g
Outstandin
9 g
7 Good
5 Fair
Modeling
Accounting/
Finance
Prioritizing
Work Ethic
Team Player
Flexibility/
Versatility
Motivation
Overall Rating
5 Fair
12
6
5 Fair
5 Fair
7
7
6
5.9
7 Good
5 Fair
5 Fair
Ken Goldstein
Commitment to
firm
Judgement/
Maturity
Interpersonal
Skills
Impact/
Presence
Communication
Skills
Leadership
Initiative
Motivation
Technical Skills
Creativity
Modeling
Accounting/
Finance
Prioritizing
Work Ethic
Weights
(total
100)
Mar
ks
Remarks
Reasons
5 Fair
3 Fair
7 Good
7 Good
Outstandin
9 g
Outstandin
9 g
5 Fair
Outstandin
9 g
12
Outstandin
9 g
Outstandin
9 g
10
10
7
8
7
Team Player
Flexibility/
Versatility
Motivation
Overall Rating
Unsatisfact
2 ory
7 Good
5 Fair
6
6.59
Andy Sanchez
Commitment to
firm
Judgement/
Maturity
Interpersonal
Skills
Impact/
Presence
Communication
Skills
Leadership
Initiative
Motivation
Technical Skills
Creativity
Modeling
Accounting/
Finance
Prioritizing
Work Ethic
Team Player
Flexibility/
Weights
(total
100)
Mar
ks
10
Outstandin
9 g
Reasons
He had several informational
interviews with the firm and talked
to other asosociates on several
occasions whenever it was possible
10
Outstandin
9 g
7 Good
Outstandin
9 g
Outstandin
9 g
Outstandin
9 g
7
7
5 Fair
5 Fair
12
6
5 Fair
5 Fair
7
7
5 Fair
5 Fair
Remarks
Versatility
Motivation
Overall Rating
References
6
6.88
6 Good