Myths about the Investment Banking Hierarchy broken.
At the lowest level of the investment banking hierarchy are the analysts. To find this young talent, the I-banks send their manicured young bankers out to IITs, Harvards and Princetons of the world to roll out the red carpet for top undergraduates and begin the process of destroying whatever noble ideas these youngsters may still have left. For the recruiting banker, the ideal candidate is somebody with high intelligence, love of money (or the capacity to learn that love) and the willingness to work all night, every night, with a big grin on his face, like the joker from Batman.
The Analysts are at the bottom of the shit heap. They are like the public toilets at the local bus station. They'll spend two to three years being mentally, emotionally and physically abused, and for that benefit they'll be well trained and extremely well compensated. No matter how bad things get, they'll never have anybody lower on the corporate bean stalk to whom they can off-load their misery.
Following their two-to-three-year stint, the vast majority of the analysts will either strike out for any of a handful of graduate b-schools, depart the firm for other investment banks or hedge funds, or regain their sanity and elect to pursue other interests entirely.
A majority of the analysts leave the job pissed off and with a deep hatred of the investment banking institution. They learned a lot and enjoyed being paid more money than they ever thought they could make, but they also despised the work and the people that made them do it. However, amazingly, it seems that about 50 percent of those analysts who hated what they did go back to investment banking after two years in a graduate business school program. Somehow absence makes the heart grow fonder. As with a bad injury, they tend to forget how terrible the pain was. They know it was painful, but they just forget all that and go back into i-banking thinking that life as an associate will be different. Well as they say grass is always looks greener on the other side, they also face this truth to reinjure themselves .
The Next stop in Investment Banking designation ladder is the associates. You can generally assume that the associates are a happier lot than analysts, since they have both the institutional backing and the ability to ease their own misery by dumping the pain onto analysts. Therein lies the beauty of the hierarchy.
For the associates in the investment bank, there is no corresponding get out of jail free program to avail oneself of at the end of a two-three year stay. Associates are generally expected to climb the corporate ladder to the top of the goldenpyramid. Vice President, Senior Vice President, Managing Director, Group Head. The path is clear. In reality, the attrition levels for associates is fairly high. The one's who get tired of working like a slave in the same firm without any promotion move on to rival investment banks. They leave to work for the clients of Investment banks. Some leave when they realize that sex with themselves is becoming the norm. These days the investment banks doles out the designation of associate vice president to keep these associates from fleeing to other banks.
The Others- Vice President to Managing Director
Please don't get carried away when someone working in investment bank flash their visiting card or business card which says vice president or managing director. No other industry/ sector/ company would have so many vice-presidents or managing directors in the same firm. Sometimes, i wonder if there are more vice-presidents than associates and analysts. The work done by these people are more or less same, the only difference being the size of the paycheck that this category take home is significantly higher than the rest of the people working in the corporate sector. Atleast, in the Trading side where i also happen to work, the work done by everyone from associates to managing director is the same. All walk in at the same time, sit in the same trading floor, trade markets and go home. Vice Presidents and Managing Directors have their own secretaries and Offices.
Every Associates' goal is to make it to Vice-President in three to four years, senior vice president in five to seven years and managing director in seven to nine years. They all hope to make seven and eight figures by the time they hit managing director.
Sometimes, though, from the associate's perspective, it seems like there are just three levels in the investment banking hierarchy: analysts, associates, and everybody else. After all, anybody senior to an associate has the institution's divine sanction to shit on the associate's head, and if you're the one getting suit upon there isn't usually much reason to further subdivide the hierarchy of those doing the shit-ting.
Supreeth S M & John Rolfe