Everyone makes blunders early on in their career, even they eventually end up at the top. Here are the most common lapses in judgement and just plain-old poor decisions that junior bankers make.
1. Playing favourites with managing directors
More specifically, focusing on one single MD – this causes you to limit your exposure and get pinned into a single coverage group, meaning you get pigeon-holed into one sub-sector, says Simon Lewis, managing director and head of the banking & financial services practice at Michael Page.
“Also, the MD can become dependent on you, causing your hours to suffer,” he says.
2. Not sucking up to your staffer
When your staffer likes you, you have a better chance of getting the good exposure to the right kinds of deals that will make your resume stand out.
“Being on your staffer’s good side can help you to avoid Friday staffings and poor-quality new accounts,” he said.
3. Not paying attention during Excel training
Investment banks will teach their juniors financial modeling, but often Excel skills and the shortcuts needed to get out of the office before 2 a.m. are lacking. Slacking off on whatever training the banks provide during the first few weeks is likely to have a long-term detrimental effect on your career.
“Being efficient in this area will help you achieve a ‘top-bucket’ bonus and a third-year offer,” claims Lewis.
4. Following the money and hopping around too frequently
Junior bankers who leave for a new firm every time they’re offered a raise risk being labeled as a job-hopper, says Jeanne Branthover, managing partner and the head of the global financial services practice at Boyden.
On the other hand, staying at a job for, say, three-to-five years can help juniors gain necessary experience and could make them more attractive.
Junior bankers don’t get enough experience out of their first job, according to Carol Hartman, managing partner of the financial services practice, North America, at DHR International.
“I had one of those investment banking jobs right out of college, where you stay two years and move on, so I know there’s a typical program,” Hartman said. “I see a lot of people who leave after one year to do the next thing, often jumping to private equity or a hedge fund.
“Instead, they should take the opportunity to really become experts at what is in front of them and what they’re doing, be in the moment and not focus so much about the next opportunity,” she said. “Don’t worry about what your friends are doing.”
5. Allowing your associate to lead all of the client calls
If you impress the clients as an analyst, then they will be more likely to try to hire you as an associate, Lewis says.
6. Not taking time to network
Focusing strictly on work and not making enough of an effort to network with both peers and managers is a problem, Branthover said.
“To promote your career, it is essential to network both internally as well as externally to build contacts for internal promotions and future external job moves,” she said. “Unfortunately, many junior bankers work long hours, are inexperienced with the importance of building their networks and keep their heads down focusing only on their immediate work, deadlines and pressure.”
7. Missing the MBA window
MBAs are less important for moving up in investment banking than they once were, but top schools in the U.S. are still good seeding grounds. Combining investment banking experience with an MBA not only gives you the opportunity to progress, but also opens up a whole range of exit options.
“Working too many years before going to business school and deciding career and compensation are more important than getting an MBA is a common mistake that junior bankers make,” says Branthover.
8. Taking a job because of comp when there is not a cultural fit
Especially early on in your career, maximizing your compensation at all costs is not the smartest way to build a successful career over the long term. Finding a great fit for your interests, desired skill set and culture are far more important.
“You’re already breathlessly compensated, so don’t worry,” Hartman said. “Life is long, and it’s possible that you’re already making more money than your parents.”
9. Getting sloppy drunk with colleagues
If you’ve been used to subsiding on a college income, then it’s easy to over-indulge when you’re out with colleagues and either the drinks are free or you have more than enough income to pay for them.
When you’re going out to happy hour or at an industry conference’s cocktail hour, Hartman recommends abiding by a two-drink maximum.
“Do not party with your boss,” Hartman said. “I’ve seen unflattering behavior, people making fools of themselves in front of co-workers, and it’s cost people their jobs.
“If you’re going out drinking, it doesn’t have to be an MD, it could be a third-year associate, everybody gets sloppy, people get embarrassed and it doesn’t go well later on,” she said. “Life at work doesn’t get simpler when there are social complications, so keep things on a professional level with a two-drink maximum.”
10. Avoiding the dirty work
Junior bankers should volunteer to step up and do the work that no one else wants to do, Hartman advises.
“Everyone wants to work on the Gucci deal, the sexy deal, but no one wants to work on the dog food company deal, even if that’s where the real profitability is,” she said. “Do volunteer work on the payday lending deal, go where the smart money goes, because you might be generating your biggest bonus opportunity.”
11. Not bothering to figure out how your current role fits into the bigger picture
Don’t rush ahead too quickly without mastering your current responsibilities, even if your job is tedious. Learn the details of the role you’re in backward and forward, because that knowledge will serve you well in the future.
Also, pick up business management skills as much as you can, because as you move into more senior roles of any kind at a bank, understanding how people and departments are managed will set you apart, according to a UBS executive who asked to remain anonymous. Knowing how everything is connected and understanding the dependencies between the front office and the control functions is priceless.
“Knowing how everything is connected and understanding the dependencies between the front office and the control functions is priceless,” she said.
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