Fellow MM PMs out there, wondering how you went about firing an underperforming analyst? I’ve never done it before but after a couple of years of contributing no value and not showing much potential to contribute future value I’m considering pulling the plug. Any considerations or surprises when doing this? Is a couple of years of runway a reasonable amount to to give?
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Curious what you define as "contributing no value." I'm assuming you've discussed areas of improvement with said analyst and he/she shows no desire to improve (or is just intellectually unable to improve)?
In any case, I think 2 years is a reasonable time to give someone to figure it out.
Alternatively, you could just give this person a 0 or low bonus and they'll figure it out for themselves.
Contributing value = generating PnL for the book
2 years more than enough.
Many platforms have an HR partner that can help you think about communication and making sure you don't say anything you shouldn't say.
Above all, be an adult and communicate the decision. None of that BS someone suggested of "pay him zero bonus and let him figure it out". People deserve to know and if you want him out, the decision should be yours not his.
If he’s an analyst with a sleeve that hasn’t made money the last 2 years then yeah it’s fair game.
Hm why does it matter whether analyst has a sleeve or not? No value should be the same regardless if it’s explicit with a sleeve or implicit without one?
You’re right. Doesn’t matter if the book is separate or not. If names he’s actively pitched have net lost money each year then I think it’s fair. I was trying to make the distinction between that and an “associate”-like role where there is less expectation to actively take risk / more supporting an analyst
Have a friend who was let go at Millennium. Was very simple actually. The PM notified HR that he wanted to axe the analyst. After that, HR sent an email to the analyst and the PM to schedule a meeting with HR. The PM called my friend 20 minutes before the meeting to let him know he was being let go. The meeting took place with HR doing all the talking (want to avoid any legal issues) and my friend was out the door 20 minutes later.
How long was your friend's job search afterwards? Was your friend about to land on their feet? I might be in a similar situation and am curious how receptive other funds are to being "spoiled goods."
MLP is notorious for poor jr analyst culture and support
MLP will let other PM's know that analysts are available and PM's can choose to interview and hire those analysts. My friend landed in another MLP pod as he was a good analyst but just fell out with his PM. Generally, once you've been at a pod it's quite easy to get an interview at another pod shop.
I would be very disappointed if my PM would not speak to me in person before hand. Imagine you work for two years together in a small team and then they do not even have the balls to look you in the eyes and instead let HR do all the BS talking... Reflects pretty poorly on that PM in my opinion. Of course it is rational for a non-performing analyst to be cut and also for them to leave the building quite quickly to avoid additional IP leaks, but at least the PM should show some empathy and have a short dialogue with the person instead of throwing them out within 20 minutes and never ever speaking to them again.
The goal is to avoid heated discussions that could lead to legal action being taken. It's like any trade, upside not worth the downside risk. Typically, once emotions have cooled down, you might meet up for a beer/coffee to debrief and get some closure.
Unfortunately this seems to be the norm. Analysts are viewed as completely disposable at most firms, and the firings reflect that. Legal action can be taken regardless of what the firm does, and is more likely if the person gets angry.
i heard some (all?) major platforms had internal policies that PMs cant speak with their fired analysts until after 3 or 6 or some number of months - can someone confirm? hr/compliance/legal concerns i suppose
Piggybacking here. I am a pod analyst and I plan on quitting soon. When pod analyst quit do I go to HR or do I talk to my pm first. Thanks guys
Hey OP, I worked closely with our executive team and HR directly in the past. Consult them to lay out a strategy that would best fit to protect the firm - above all else. This will be key. Every company, firm, etc., has different means of letting people go. HR would be the best call (and not WSO) on this one.
Feel free to PM, but good luck.
Don't feel bad about letting go of an analyst, if possible (legal concerns) let the analyst know what factors led to this decision -- and atleast mention how they might have some strong suits in certain areas. I was let go from an AM, and it lit a fire under my ass to never be complacent -- it really is a chapter in my journey that has helped me grow professionally
Did you give him any feedback during this time or any effort from your side to help him/her "fit in" and add value? If so, two years seem long enough. If you decide to let them go def recommend working with HR at least for consultation to avoid any issue.
IK an analyst let go at my pod after 9mo... PM only met him a few times before switching offices, and gave him 0 bonus... then offered 4-5mo time frame to 'find a shop' w/ PM recommendation... sounded like PM got impatient and pulled the plug after just 2mo without notice (analyst just got a random call from HR one day)... analyst def clicked well w/ sub-PM but embarrassed the PM on the trading floor one evening by contradicting an obvious fact and despite apologizing, he could never repair the ego damage dealt to his PM... glad my PM isn't like that. Brutal.
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