Who Determines Who's Laid Off -- HR, or MDs?
I would assume it's MDs; after all, that's who you work with/under all day.
But there was a comment earlier (might have been in GS thread) implying that HR determined who was cut, with MDs having little say/interaction about the decsion.
Is this actually possible, or a thing? Where HR just looks at who "scored" the worst in reviews (bottom bucket), and determines those are the analysts who get cut? Which seems weird bc it seems like you could technically get bottom bucket if you have one below-average experience with your deal team (one of two bankers) that took up the bulk of the year, despite the fact that you could actually could be well-regarded and liked by most of the team, including the MDs you didn't work with on that deal, but who like you, respect your work and like having you around.
So which is it? Or does it depend on the bank?
Yes at a bigger bank it is quite realistic that HR would make the call based on scoring. You say or imply that MDs should have a say, but of course they do . . in the scoring. Agree with you that the scoring can be luck-based, but the firm already decided to put a lot of weight on scoring when they decided to base bonuses off of it. So fair or not there is some measure of faith in the scoring and it would be inefficient to ask the MDs to revisit that methodology for layoffs.
Lastly there could be a legal liability if you depart from objective criteria that you previously used.
Not saying it will be this straightforward but it wouldn’t be surprising at all if the scoring plays a role, probably subject to final approval from group heads.
I guess that makes sense. Just troubling that, if one low-ranking MD and one hardo/disliked VP gave you a mediocre rating based on unreasonable demands they made during one deal-process, you can be gone, even if the majority of bankers think you're doing well and enjoy working with you.
I wouldn't be so worried about it. A lot of things have to go wrong. First you'd have to screw up as described. Then you'd need those guys to actually punish you in the review. Then you'd need the person who oversees reviews (staffer, group head, etc) to not have any process in place to correct/normalize for this unseemly possibility that a single bad experience can cost someone in the bucketing. And then you need there to be no offsetting good-luck events. Then you need HR to just blindly apply the bucketing (which I said is realistic not what will happen).
My first year I had the classic bad deal team that threw me under the bus. I got kicked off a sell-side by an MD who didn't remember his own instructions and blamed me for doing exactly what he told me to do. But I also had two MDs who gave me way too much praise for just going through the motions on easy deals. Ended up top bucket without doing anything too special. Just an example, but the point is a lot of factors come into it.
McKinsey
Well, at least good to hear that sometimes senior people can step in and push against HR's less-subjective decision to can someone who might be well-liked/well-respected.
Definitely seeing a trend of HR having more and more power in these sort of things. Off-topic here, but at my bank the deputy head of a division decided to leave the firm out of internal politics (he exited to be CFO of a plantation company, bless him). He had worked at the bank for his entire finance career, was very well respected, had a say in a lot of things. When he announced his resignation the head of that division persuaded him to stay on for just another month to help with transition and train up the juniors. He agreed, but HR stepped in and disagreed. HR said smtg like 'He's been here for 20+ years, if he had transition and training to do he'd have done it already'
So HR has more power over a veteran
I can't confirm but heard anecdotally from an MD at a BB that HR set the number of people and title and the MDs would need to provide names to fill that quota. Ex. HR says 2 Associates in a group need to get cut and its up to the MDs to select who those two are and submit the names back to HR.
That makes more sense to me. At least seems more "fair."
My experience here is from consulting not banking so if its somehow not applicable someone please correct me.
But if you get 1 or 2 reviews a year and they’re bad, you are a poor performer in the firm’s eyes. Even if you’re performance is viewed positively outside of your reviews, you aren’t protected from negative performance outcomes at all. This is true outside of layoff scenarios, too. You should strive to make sure your performance is accurately logged in your reviews.
I bring this up because this post implies that someone getting the axe because their reviews are bad, even if they are well perceived, is surprising or unfair somehow. This really shouldn’t be that surprising. Reviews leave a paper trail of how you are performing. They serve a borderline legal purpose in this way. Goodwill outside of reviews is not useless to be sure, but definitely shouldn’t be banked on to protect you.
These things aren’t 100% in your control, but you should do everything within your power to make sure what ends up on paper about your performance is positive. Otherwise, you should not expect positive outcomes in regards to promotions, bonuses, or layoff selections.
Yes, one below average experience with a deal team can impact you disproportionately, especially if you dont have other reviews to balance it out.
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