41–49 of 49 posts
How much staff is really really needed for these quant shops? After an algorithm is developed isn't it just rinse/repeat? Honest question, as I'm not a finance guy.
Earlier quoted context omitted.
Unless of course you follow that argument to its logical conclusion...
That's exactly what companies like GE and Intel do. I personally think it's terrible management practice, but it seems to work for them, and there's always fresh young blood coming in at the bottom.
I think the key (and I don't have a lot of experience with folks who work at GE, so I can't speak to it's validity) is that it works if deployed as part of an overall system.
That system is that you reward the top performing earners heavilly (with bonuses and promotions), and remove the bottom 10% annually. In theory, people are constantly being kept abreast of their performance, and given opportunities to improve; so that those in the bottom 10% shouldn't be surprised when the end of the year comes and they are laid off.
Welch defends the practice by talking about the alternate scenario where people are kept on staff for years who aren't performing well, have never been told that is the case, and are suddenly surprised when one day the company needs to have layoffs and are terminated. He calls it "false kindness".
I've always like the part of Differentiation where you let people know where they stand. I've thought it would be nice to work somewhere that had a better model for performance reviews (where I work presently, they are basically a checkbox).
I'd love to hear from someone at GE as to whether the system actually works the way Jack Welch describes it.
Is 10% really that bad? If it's the bottom 10%, it should actually improve company's performance.
Assuming you can actually figure out who the bottom 10% are. Also assuming that the bottom 10% is a constant and not something that literally changes daily.
Now, I agree that quantifying that is non-trivial. I've always been interested in places where they actually do that (and wonder how accurate it is), but I wouldn't be surprised to find that people who find themselves in that lowest 10% don't find themselves there on a whim.
Earlier quoted context omitted.
The downvote seems to indicate a citation is necessary: http://en.wikipedia.org/wiki/Jack_Welch#Tenure_as_CEO_of_GE http://www.geek.com/articles/chips/updated-rumors-intel-layo... (The Intel practice was also confirmed in Andy Grove's book "Only the paranoid survive".)
Did you read the second article? > Intel announced it will reduce its workforce by 4,000 workers (5%), mostly through attrition or voluntary separation programs. I joined Intel shortly after that article was written (2002). For much of my tenure (3 years), Intel had a US hiring freeze (except through acquisition, how I got hired) and aimed to reduce its headcount primary through attrition, not layoffs. I felt like In…
In any case, I think Andy Grove's book is a better citation, but some people on the Internet don't read books.
One thing I always found odd about DE Shaw is how casual the work environment is. It's like google, but in Manhattan. The problem is NY isn't california and quant finance isn't all software. There's a certain pace and overt competitiveness to Manhattan that enforces a discipline and a work ethic onto people. This works quite well in the Darwinian world of finance. But, from what I saw of various parts of DE Shaw's op…
Is 10% really that bad? If it's the bottom 10%, it should actually improve company's performance.
This is sad. Founded by a computer scientist, DE Shaw is perhaps the most tech-focused among hedge funds. I once had a very challenging technical job interview there. Several interviewers had PhD in Computer Science.
i'm not convinced they're smarter than anyone else. i'd rather invest in renaissance or citadel... my coworkers at morgan were all physics or cs phds. and a consulting expert got a nobel prize while i was there. amusingly, i interviewed at google around the same time, and some of the engineers were condescending about the quality and education of my coworkers.
They show off to attract similar candidates because they know they are nowhere compared to these biggies.
If I have a offer from Goldman why the fuck I join de shaw or xyz company.