Here's a curve ball for those who believe every new hire is expected to hit the ground running, with zero ramp-up period: Senior executives from two investment banks (one mid-sized, one bulge-bracket) just publicly rejected that nostrum.
Andrew Duff, chief executive of Piper Jaffray, even gave a specific time period: "We estimate it takes 18 months for a senior hire to reach full productivity, with some variability by business," he told analysts on a conference call Wednesday.
Meanwhile, Morgan Stanley CFO Ruth Porat also acknowledged Wednesday that newly hired producers need time to get up to speed. Describing the bottom-line impact of some 350 new sales and trading professionals who came aboard last year, Porat said, "With a client-facing business and a trading business it takes a period of time to ramp up to full throttle."
Executives in Morgan Stanley's conference call repeatedly portrayed last year's additions as phase one of a "multi-quarter build," but wouldn't specify what's next. Porat said the bank remains focused on "catalytic hires." CEO James Gorman said:
In institutional securities, we completed the first stage of our global hiring plan announced last year. We'll continue to broaden our footprint through ongoing key hiring and talent retention.