Everyone makes blunders early on in their career, even they eventually end up at the top. Here are the most common lapses in judgment and plain-old poor decisions that junior bankers make.
Focusing on one MD 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/founder of Simon Lewis Associates.
“Also, the MD can become dependent on you, causing your hours to suffer,” he says.
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,” Lewis says.
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,” Lewis says.
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 at DHR International.
On the other hand, staying at a job for, say, three-to-five years can help juniors gain the necessary experience and could make them more attractive.
Junior bankers don’t get enough experience out of their first job, agrees Carol Hartman, managing partner and head of the financial services practice at DHR.
“I had an investment banking job right out of college, where you stay two years and move on, so I know there’s a typical program,” Hartman says. “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 not focus so much on the next opportunity,” she says.
If you impress clients as an analyst, then they will be more likely to try to hire you, Lewis says.
Focusing strictly on work and not making enough of an effort to network with both peers and managers is a problem, Branthover says.
“To promote your career, it is essential to network both internally and externally to build contacts for internal promotions and future external job moves,” she says. “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.”
MBAs are less important for moving up in investment banking than they once were, but top business schools in the U.S. are still good seeding grounds. Combining IB 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.
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, skill set and culture are far more important.
“You’re already breathlessly compensated, so don’t worry,” Hartman says. “Life is long, and it’s possible that you’re already making more money than your parents."
When you’re going out to happy hour with colleagues or at an industry conference’s cocktail hour, it's easy for recent graduates to over-indulge.
“Do not party with your boss,” Hartman says. “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 associates, everybody gets sloppy, people get embarrassed and it doesn’t go well later on,” she says. “Life at work doesn’t get simpler when there are social complications, so keep things on a professional level with a two-drink maximum.”
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, because it's sexy, but no one wants to work on the dog food company deal, even if that’s where the real profitability is,” she says. “Volunteer to work on the payday lending deal – go where the smart money goes, because you might be generating your biggest bonus opportunity."
Master your current responsibilities, even if your job is tedious. Learn the details of your role backward and forward, because that knowledge will serve you well in the future.
Also, pick up business management skills, because as you move into more senior roles 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 are priceless," she says.
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