When the oldest members of Generation Y, born roughly in the 1980s, began graduating from college, a collective groan was heard on investment desks throughout Wall Street.
Gen Y is the stereotypical tag attached to the rookie investment bankers that comprise the current pool of new hire candidates. Many bankers have claimed that Gen Y-ers have an excess sense of entitlement, are pampered, arrogant and lazy. They want to do work on their terms and receive a constant stream of feedback.
I remember literally being petrified of senior staff. On the contrary, Gen Y (or Generation Why?) has been raised to ask questions and be assertive. As confident, independent thinkers, they look to modify existing protocols. Not to mention, Gen Ys are oftentimes referred to as "trophy kids," a term that reflects the trend in competitive sports where mere participation alone is enough for a reward.
Recently, I spoke with a managing director and the feedback I received on this generation’s new analyst class was: “They walk into the place like they own it, they aren’t interested in doing the stuff we really need them to do. They want to be the associate, the VP from day one. However, without doing the nuts and bolts work down there in the analyst pool, how are they going to know how the dynamics work? Yes, this stuff can be tedious, but it’s a learning experience. It’s a necessary rite of passage.”
When the economy tanked, millions of Gen Y-ers reinvented themselves to show how much and how quickly they can add value to their organizations in the most efficient manner. The talent pool is changing. I’ve always had the belief that change tends to be good; it inspires evolution. But change needs to be managed and integrated otherwise the result is conflict and distrust. Conflicts can arise with Gen Y hires that have been tagged as having an undeserved sense of entitlement, unrealistic expectations, an opinionated view, lack of loyalty, a lazy attitude, as being pampered, an arrogant approach and a needy disposition.
This type of judgement can be viral – stated once and then repeated many times throughout the business. An opinion, even one based on the briefest experience, can become fact through sheer repetition. An entire generation of analysts surely cannot be labeled with one broad brush stroke.
I have come to appreciate that it’s not so much that there is an authority or respect issue, but an approach issue. Senior bankers are used to analysts being in the engine room not wanting or pushing for an invite at the captain’s table. Gen Y is keen to take on responsibility, to be involved and to have a say that is heard. They believe they are good enough to take on the task. I am keen to encourage such behavior as it sends the analysts up the learning curve quicker. However, this sometimes overly enthusiastic approach can cause a head-on clash of cultures or generations.
Generational divides can best be managed in a number of ways. Improved training. Stimulating, value-add training can lead to employee appreciation and helping them transition into the existing culture of a bank. The training must drag the analysts out of the text book and spoon fed environment they have become accustomed to while in education.
This is a job. It requires judgement, thought, analysis and a pitch to clients. Training must mirror this environment and develop this behavior through live cases studies and deal-based transaction cases currently in the market. Get them to do rather than just learn and repeat. The real world does not just regurgitate a circular set of prescribed deal scenarios. Each one is different in its own way. The analysts must be given the training provision to get the technical foundations in place and then be allowed to apply them to current deal scenarios.
Better management and delegation of projects. Gen Y analysts must be shown the reasons why their work is bringing value to a project, rather than being assigned to a project without any meaningful context or support.
Continuous feedback. Gen Y professionals thrive on constructive criticism and positive reinforcement and some level of continued feedback can help motivate and engage these analysts.
Gen Y must pick its battles. They should not question every little decision or process but question only when appropriate. The established bankers must be given time to transition into dealing and managing this generation. Some banks will train their new staff on how to transition into work. We need to focus on getting analysts to think about the impact of their actions, their co-workers and the banks they work for.
The older generation must adapt too. This is a generational evolution. It is not like this is the first time generational behavior has shifted. Imagine what the senior bankers back in the 1980s thought of the new recruits back then. I remember these guys being labeled as yuppies. Each new generation causes its own conflict with the established regime.
At the end of the day, these analysts are probably some of the best qualified, most well-rounded analysts we’ve seen in decades. Their extra-curricular activities are wide ranging and their qualities and self-beliefs make them incredibly mobile.
Geoff Robinson is head of investment banking at 7city. Contact +44 (0)845 0727620 or G.Robinson@7city.com