Morning Coffee: The Morgan Stanley intern who was promoted at a crazy speed. Swiss banks’ adventures with replacing employees with algorithms
As meteoric rises go, they don't get much faster than this – seven years ago, Jannie Tsuei was an intern at Morgan Stanley. Yesterday, it was announced that she has been promoted to be their Chief Operating Officer for Southeast Asian investment banking. Looking at Jannie's LinkedIn suggests that the COO title is not the whole story - she still lists herself as a VP - but even so it's some impressive progress. What can we learn from this rapid rise?
First, you need to be an academic high flyer. Ms Tsuei is a graduate of Harvard and Wharton, who wrote for the prestigious university newspaper “The Crimson” as an undergraduate. That’s often a passport into high flying media jobs and is one of the best resume points there is. She also graduated magna cum laude from Harvard and cum laude from the Wharton MBA program, both indicating a position near the top of her year.
Second, some business experience in the real world helps. Rather than taking the undergraduate path into investment banking with successive summer internships on Wall Street, Ms Tsuei got a teaching qualification at the Harvard Graduate School of Education, then spent three years as a business analyst at the Sears Corporation, before going to Wharton to do the MBA with specialisms in Finance and Real Estate. Time spent at one of America's biggest retailers - and a company which had no shortage of financial and real estate problems to work on – would have been excellent preparation for her first role at MS, on the US real estate advisory team.
Third, don't be scared to move to where you will be most appreciated. In 2015, Ms Tsuei left New York to join the coverage team in Singapore. That could have been a shrewd move. It's always good for a young banker to get international experience, and to demonstrate commitment to the job by taking on an expat posting. But for a young female investment banker, Southeast Asia seems to be a remarkably good place to get yourself recognised. In Malaysia, for example, the CEOs of three local investment banks, plus the country heads of Credit Suisse, Rothschild and OCB are all women.
Finally, think about your career in the long term. Many people would be resistant to a promotion which took them out of the front line of revenue generation and put them into a back office COO role. If your main concern is immediate bonus potential, this is not a bad way to think about things. But if you have designs on the most senior roles, it can make sense to sacrifice short-term greed for long-term ambition. Moving between front office and operational roles is often the sign of a true high flyer. If someone is being groomed for even more senior posts in the future, then at some point in their life they are going to be in a position where they are responsible for these issues, so they might as well get some experience now.
Not many of us could follow these examples exactly – Ms Tsuei is clearly a bit special. But this doesn't mean she can't be emulated. And if she's not your role model, you can always follow the trajectory that took Jim Ratcliffe from private equity to becoming Britain’s richest man.
Separately, while MS is bringing on the new generation, the Swiss banks are continuing with the project of replacing employees by robots, with varying degrees of success. The data science team at UBS are working on “Netflix-style” algorithms to recommend trades to clients based on positions they have taken in the past.
This could go either very well, or very badly. Giuseppe Nuti, the head of the UBS team responsible for this idea, is correct when he tells the FT that one of the key skills of a salesperson is to know a comment and his or her trading style, and to recommend ideas which suit that particular client. But the key skill here is to present these ideas in a reasonably tactful way. Nobody, least of all a hedge fund trader, wants to be thought of as predictable or set in their ways. If the algorithm is going to come up with things like “hey Steve, you like shorting tech stocks and you don't like larger than life CEOs so why not short Tesla?” then it is still going to need a trained professional to make things sound convincing.
Credit Suisse's “Amelia” also needs human beings to work with her for the time being. Amelia is a chat bot, which sometimes serves as the first point of enquiry for CS employees when they try to get the help desk to sort out some of their IT problems. The idea was that Amelia would be able to recognise enough human language to give canned responses to the most common issues like forgotten passwords or full email boxes, leaving more time for the professionals to deal with more complicated things. At present, Amelia can understand around 13% of the questions which come in, which could be good – the programmers reckon she does the work of a dozen professionals - or could be seen as indicating that human beings will be needed in banking technology for a while longer.
Morgan Stanley has launched the first employee childcare scheme in Canary Wharf (Goldman Sachs already had one, but not in that part of London). Via a salary sacrifice scheme, employees can sign up to get places which have been bought from Bright Horizons, a private nursery provider. (City AM)
Brexit preparations are now being described as “panic” as fund management houses including Artemis, First State and Newton attempt to get the right to authorisations for their Luxembourg and Dublin offices to be able to continue offering their products on the same basis as they do now. (Financial News)
In Asia at least, the staff cuts at Deutsche Bank are now nearly complete. That's the message from a interview given by James McMurdo, the regional CEO, in which he says that “our core banking team has stayed together” and that Deutsche is now making more revenue in the region despite lower staff numbers (Bloomberg)
If you've been following the Goldman / Chris Rollins legal case, Bloomberg have a background piece on Lars Windhorst, who is widely believed to have been the “notorious European businessman” responsible for the compliance breaches which got Rollins dismissed (Windhorst, through a spokesman, denies this identification and says the case is nothing to do with him). The issues raised about who owns the relationship with a big client will be familiar, although people are usually more likely to be trying to take the credit rather than avoid the blame (Bloomberg)
Paul Greenwald, a former hedge fund millionaire who lost his fortune and who had been sleeping rough, has gone missing from the hospital he was staying in. (New York Post)
Another day, another senior level hire at Goldman Sachs. Healthcare banker Jonathan Piazza, joining from Barclays. Not clear whether he will be joining at the partner level, but given his rank and experience (Managing Director who came to Barclays with the Lehman acquisition) it’s certainly possible. (Business Insider)
London is not just under threat from Frankfurt, Paris and Dublin – Manchester wants to give it some domestic competition in the fintech sector (Finextra)
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