Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Goldman Sachs Tells Interns to End the Late, Late Show

wsj.com

Post reply on HN
Print view View original

41–50 of 64 posts

Re: Goldman Sachs Tells Interns to End the Late, Late Show

#41

Post by ThrustVectoring »

Chinjut wrote: post #34
tdees40 wrote: post #32

A thought experiment: you have a job that pays exorbitantly well, and you want to offer it to someone. It isn't particularly difficult, and any reasonably well-informed, self-motivated college graduate can handle it. How do you hire for that job? The demand is likely insanely high. Spoiler alert: you create an insanely complicated funnel to weed through huge quantities of candidates. And if talent isn't the primary d…

If the demand is so high, why not simply lower the pay to winnow the candidate pool? Why bother with the insanely complicated funnel instead?

If you lower the pay, the "best" candidates get grabbed by competing firms. The funnel works because you're not just selecting a subset of people, but because you're selecting a particular group - specifically, those who are willing to give the firm a better share of the organizational rents.

Re: Goldman Sachs Tells Interns to End the Late, Late Show

#42

Post by whatok »

tdees40 wrote: post #38
Chinjut wrote: post #34

Earlier quoted context omitted.

If the demand is so high, why not simply lower the pay to winnow the candidate pool? Why bother with the insanely complicated funnel instead?

Because your pay is high too! If you can find people to work beneath you for cheaper, why can't they replace you for less money? Edit: also, they do that with intern/entry-level banking jobs. Internships pay well, but it's nothing like what higher-level bankers make. Same with entry-level analysts.

The senior bankers who actually bring in clients are worth their weight in gold. 0 chance anyone in a position like that is going to stick around to get underpaid while bringing in business.

Re: Goldman Sachs Tells Interns to End the Late, Late Show

#43

Post by georgehotelling »

Chinjut wrote: post #34
tdees40 wrote: post #32

A thought experiment: you have a job that pays exorbitantly well, and you want to offer it to someone. It isn't particularly difficult, and any reasonably well-informed, self-motivated college graduate can handle it. How do you hire for that job? The demand is likely insanely high. Spoiler alert: you create an insanely complicated funnel to weed through huge quantities of candidates. And if talent isn't the primary d…

If the demand is so high, why not simply lower the pay to winnow the candidate pool? Why bother with the insanely complicated funnel instead?

Well it's already $0 in some situations, so... charging people to be interns? You just might have a future in finance.

Re: Goldman Sachs Tells Interns to End the Late, Late Show

#44

Post by qq66 »

tdees40 wrote: post #32

A thought experiment: you have a job that pays exorbitantly well, and you want to offer it to someone. It isn't particularly difficult, and any reasonably well-informed, self-motivated college graduate can handle it. How do you hire for that job? The demand is likely insanely high. Spoiler alert: you create an insanely complicated funnel to weed through huge quantities of candidates. And if talent isn't the primary d…

The funnel is not that complicated; it's set up to find the people who are willing to make any amount of personal sacrifice to make huge amounts of money. Those are the people they want to be future Managing Directors. Startups that have insane working hours are doing the same thing.

Re: Goldman Sachs Tells Interns to End the Late, Late Show

#45

Post by whatok »

stephengillie wrote: post #40
tdees40 wrote: post #32

A thought experiment: you have a job that pays exorbitantly well, and you want to offer it to someone. It isn't particularly difficult, and any reasonably well-informed, self-motivated college graduate can handle it. How do you hire for that job? The demand is likely insanely high. Spoiler alert: you create an insanely complicated funnel to weed through huge quantities of candidates. And if talent isn't the primary d…

Instead of having one job pay $200,000 per year (let's say total compensation is $350,000) and require 18-24 hours a day of work, you create 2 jobs that each pay $100,000 (total compensation $175,000 each) and only require 9-12 hours per shift. OR You could create 3 shifts at $66,667 (total compensation $117,000 each) and have true around-the-clock coverage!

So people always bring up outsourcing part of the job to some developing country but that would run into the same problem as your third option. Having too many cooks in the kitchen will introduce a lot of operational error while having a few people who know everything about a project will run things smoother even if they are worked to the bone.

Re: Goldman Sachs Tells Interns to End the Late, Late Show

#46

Post by enraged_camel »

leroy_masochist wrote: post #31
rdl wrote: post #9

What do investment banking interns (and bankers) do which benefits from such long hours? Lots of manual data processing? Reading? I absolutely benefit from uninterrupted stretches of 12-24h working on problems sometimes, but only infrequently -- usually hit diminishing returns between 4-12h. The only times where I've been useful >24h was when the task was more "set up this thing which has lots of waiting on other peo…

Former GS IBD associate here. You basically have two workdays: the client-facing workday, and the preparation-for-the-next-day workday. Client-facing workday goes roughly 9am-6pm. Preparation workday goes from 6pm to anything from midnight (on a good day) to 5am (on a bad day). During the client-facing workday you're spending about 1-2 total hours having meetings with clients, usually on conference calls, occasionall…

>>Hope this was helpful.

I found it very interesting. Thank you for the write-up!

Re: Goldman Sachs Tells Interns to End the Late, Late Show

#47

Post by CornerKicks »

tinbad wrote: post #13
adamnemecek wrote: post #8

So what exactly do they do there for so many hours a day? I'm having a hard time imagining anyone doing anything productive for that long.

Investment banking is all about dealing with other people's money and the customers usually are pretty demanding when it's well, about their money. From what I hear from my investment banker friends a lot of the day is spent socializing and going on client meetings, lunches, dinners to satisfy the relationship and then usually back to the office to do the 'actual work'. It's a lot of hard work but that's why these gu…

Investment banking is about helping companies raise equity, debt and engage in M&A, not dealing with other people's money (maybe your friends were in wealth or asset management, which sometimes sit within the investment bank?)

Having been a junior banker myself (and with friends at most banks across wall street) I can tell you that virtually no one is being taken to events or spending days socializing as an intern, let alone as an analyst or associate. You spend your days preparing pitchbooks (to pitch companies on why you should be the bank representing them), building financial models and putting together management presentations (in addition to any one-off requests your senior people or the client have). Can go into more detail but it's covered pretty well in comments above.

(Also there's no such thing as shadowing a manager in investment banking - just doesn't exist. There are mentorship programs that the banks run, but the vast majority of the time they consist of getting coffee at most once a month)

Re: Goldman Sachs Tells Interns to End the Late, Late Show

#48

Post by Floegipoky »

jorblume wrote: post #14
rdl wrote: post #9

What do investment banking interns (and bankers) do which benefits from such long hours? Lots of manual data processing? Reading? I absolutely benefit from uninterrupted stretches of 12-24h working on problems sometimes, but only infrequently -- usually hit diminishing returns between 4-12h. The only times where I've been useful >24h was when the task was more "set up this thing which has lots of waiting on other peo…

It's a gut check for motivation. How badly do you want to be there? Are you willing to give almost everything for the firm? Hazing might be a part of it but I see it more like boot camp than anything else. Weed out those who don't have the fortitude and drive. They don't want employees who value family time over the company, for example. Forcing people to work insane hours will self select for the "right stuff". It's…

They're weeding out anyone who prioritizes literally anything in their lives above money and their job, and at the same time showing those that are left that treating others as less than human is all in a day's work.

And we wonder why the financial industry keeps finding new ways to profit at the expense of others.

Re: Goldman Sachs Tells Interns to End the Late, Late Show

#49

Post by whatok »

This is a good thing. There may be some work piling up as a result of this but it's not like analysts are lacking for hours in a day to get work done. Since these changes are well-publicized, senior people will have to abide by them and clients will hopefully be more understanding on increased turnaround time.

Re: Goldman Sachs Tells Interns to End the Late, Late Show

#50

Post by 001sky »

stephengillie wrote: post #40
tdees40 wrote: post #32

A thought experiment: you have a job that pays exorbitantly well, and you want to offer it to someone. It isn't particularly difficult, and any reasonably well-informed, self-motivated college graduate can handle it. How do you hire for that job? The demand is likely insanely high. Spoiler alert: you create an insanely complicated funnel to weed through huge quantities of candidates. And if talent isn't the primary d…

Instead of having one job pay $200,000 per year (let's say total compensation is $350,000) and require 18-24 hours a day of work, you create 2 jobs that each pay $100,000 (total compensation $175,000 each) and only require 9-12 hours per shift. OR You could create 3 shifts at $66,667 (total compensation $117,000 each) and have true around-the-clock coverage!

That's not a useful solution. Consider they are trying to get 3 candidates for 1 job promotion; having 6 doesn't help it just dilutes the ability to observe. On the other hand, you now have to manage/babysit double the number of over-qualified, highly ambitious people with too much time on their hands. Thats a recipe for trouble.

Its the same logic as why PhD programs don't simply double their size when there are plenty of people with enough credentials to pass entrace exams. Its a people-management issue, and maintaining the incentives of the rank-higherarchy. It has nothing to do with talent levels.

These positions are only loosely meritocratic. The higher-order filtering is almost always based on some form of social privledge. Its not dysfunctional, at least in a litereal sense. Privledge opens doors and changes the economics (ie, productivity) of the industry materially. That is why it is selected for very heavily.

Post reply on HN