Saturday, 23 March 2013

The 360 degree performance appraisal system

If ever there were a tacit admission that modern financial institutions are too big to manage then the 360° Performance Appraisal system is surely it.

It can be characterised as many things: a orchestrated scheme for institutionalising nepotism; a sanctioned suburbia of rotten boroughs; management sponsored low-level cronyism; a Massive Multi-Player Online Role-Playing Game and, most emphatically, an unflinchingly tedious and colossal waste of an institution’s collected time and resources.

One thing you may be sure it is not is a meaningful way of evaluating staff.

The “360” is administered, as one might administer cod liver oil to an unwilling child, by the good people of Human Resources. They alone hold any affection for the process (and why wouldn’t they: it keeps them gainfully occupied for seven months of the year). Theirs are the ultimata and naked threats that accompany the system’s release each year. (inevitably it is decreed that this year there shall be no deadline extensions under any circumstances; each year defiant non-compliance and massive IT malfunction ensure it will be otherwise). The scope of the 360 - how extensive; how frequent; how in-depth - is a good measure of how captive a firm is to its HR department. It might be fun to index aggregate time and energy invested in the 360 process against share price and marvel at the inverse relationship. But no matter.

No-one doubts the 360 is well intended. So was Neville Chamberlain when he went to Berlin. By polling those with whom an employee has most closely worked regardless of rank, department or disposition and aggregating the feedback, it is meant to provide a comprehensive and unbiased analysis of each employee’s contribution to the firm’s performance.

Scoring is numeric against standardised criteria (i.e., multi-choice) although since marks out of five fail to provide a script for the awkward half hour “performance conversation” each October, appraisers are required to write prose evaluations as well. As one may have as many as 20 appraisals to write, even the most public-spirited employee will find the process trying.

Reducing matters to statistical analysis which can be fitted to a normal distribution is, of course, the sort of thing that aspiring management consultants (who inhabit HR departments in scores) adore, as it dispenses with the need to understand the fundamentals of the business. It is considered, wordlessly, to be lunacy by everyone else. If an employee’s contribution really can be reduced to something no more nuanced than a set of percentages, the open question is why have the employee at all.

Despite its admirable intentions to the contrary, the 360 is wide open to abuse, for the person who knows best with whom an employee has worked is, of course, that employee, and unless he is uncommonly stupid in no circumstances will he nominate anyone with wh0m he hasn’t already entered a mutual admiration pact.

To correct this bias, some systems allow “unsolicited anonymous feedback”. An admirable intention, but bitter indeed is she who goes out of her way to torpedo a colleague who has at least done her the favour of not requesting an appraisal in the first place. Bitter, and clearly short of better things to do. Most appraisers have trouble summoning the will to appraise those whom they do have to evaluate without volunteering to character assassinate those they don’t.

Some institutions will even go as far as appraising the appraisers on the statistical largesse of their appraisals, sanctioning those who are wantonly positive and rebasing their assigned grades. But to go to this length is to concede the system is irreconcilably broken and really only assesses an individual’s acumen at knowing who will put in a good word.

It is also to forget the all conquering power of one’s direct line manager (and, oftentimes, hers). No manager in her right mind will allow the statistical output of an obviously crooked system override her innate prejudice. Simply put, if your boss thinks you’re a moron, no amount of “consistently exceeds expectations” scores from your buddies in Operations will make a rat’s arse of difference to your hopes of promotion. And nor should they. The implied, and wholly false, presumption of a performance appraisal is that your performance management can be crowd-sourced. If that were true there would be little need for middle management or, for that matter, a Human Resources Department (now there’s a thought) at all: the firm would operate like a free market, and not the Soviet-style dictatorship it in fact is.

In the storied history of investment banking, that would be a radical idea indeed.

Wednesday, 20 March 2013

The Internet Monitor

When more than two or three are gathered together in a support function it is more likely than not at least one will find a means of appearing critical to operations whilst being possessed of enough spare time to be perpetually tethered to an entertainment website or mobile phone. Indeed, a nice quiet legal department is the perfect place for detailed examination of news websites, comprehensive perusal of Zara's online catalog or a decent stretch of research into one's family tree.
As long as the phone doesn't ring, the only irritation is the interruption brought about by having to take one's lunch break.
A sense of exasperated Britishness among coworkers (or honour amongst thieves) will usually be enough to mask this behaviour from management, who themselves may tolerate it out of preference over the rancour of a personal confrontation or because there, but for the grace of God, go I.

Friday, 3 August 2012

Gardening Leave

The kiss of the sun for pardon,
The song of the birds for mirth,
One is nearer God's Heart in a garden
Than anywhere else on Earth.
        - Dorothy Frances Gurney

A swizz, pure and simple.

The argument goes that each front office banker, salesperson and trader is so special and so important, and his departure will thus wreak such havoc on the forward prospects the bank (through the disclosure of client lists, trading strategies and the like) that he should be paid to sit at home doing nothing ("gardening" - ha!) from the moment he announces an intention to leave until the expiry of his notice period.

As a matter of solemn & immutable practice, therefore all such employees are frog-marched off the premises and "forced" to sit at home for between three and twelve months on full pay from the moment they resign: the more senior the employee, the longer the period at the greater monthly salary.

Now a naive observer might suppose that multinational investment banks should be made of sterner stuff, especially as they'll generally have as many people arriving who can spill such wondrous secrets as they'll lose in any given period. (Investment bankers are nothing if not fickle: the turnover is conservatively 10% per annum).

This is to forget that these sorts of micro employment policies are set not by shareholders but by fellow employees who fancy a similar deal as and when they switch jobs.

Investment banking pay is scandalous enough before you consider that one salary in ten in a given year is paid to the already departed.

Saturday, 7 July 2012


Investment Banks are equally good at euphemising and hyperbole, in the sense of sort of an inverted form of euphemising to make grubby or unseemly things seem important, grand and dignified. The best at it are their Personnel folk (did I say Personnel? I'm sorry - I mean Human Capital Management).

It is they who come up with bright ideas like "rebranding" your wages & benefits as "Rewards".

Now, being given a "reward" sounds like you've won a competition of skill, returned a missing whippet to its owner, or uncomplainingly completed a lifetime of selfless good works. A "reward" is that gold watch; the football that every good boy deserves.

It doesn't sound much like the filthy lucre that bankers (used to) get paid.

Once upon a time our "Rewards" were called "Compensation". We liked that, because it felt closer to what it was.

"Compensation" speaks of wrongs perpetrated; it suggests vain attempts at rectification; hollow acts of retribution for unspeakable ugliness. "Compensation" implies a forlorn essay at correcting unexpungeable stains of moral compromise on the part of the recipient: that someone has made outrageous use of compromising pictures which nonetheless are clearly of him. 

Friday, 9 December 2011

The Pure Employee

Ever wondered how some people manage to make a living out of, well, making a living?

CLOSELY RELATED, yet fundamentally different, to the Survivor is the pure employee. Whereas a Survivor will amaze all with his knack for remaining unnoticed, compensated and comfortable, the pure employee is quite the extravert: No-one is in any doubt as to his supreme at-oneness with the inner machine. That's his very point.

He thrives without special skill or expertise other than the very ability to thrive. She reflexively creates demand for his own labour the same way a narcotic creates its own addiction.

Purity tends to enrich with seniority. Once operations folk become sufficiently distant from the great steampunk machine they can, and hastily do, disengage themselves from their tether. It is a short step from there to the discovery of PowerPoint, upon which their purity transforms to near 100 per cent, overnight, from virtually zero.
The purest pure employee is possessed no practical worth, not even an evolutionary detritus of skill, but only a Masters of Business Administration, a discipline designed to systematically quash any utility a man might otherwise offer.

He functions as a project manager, business analyst or - most ghastly of all - a change manager. Ideally, he will simply manage other, more junior change managers, who will make it their business to ask silly questions of useful employees, who will give them, as convention requires, silly answers, which will be diligently fed into excel spreadsheets, maniputed, graphed, pivoted, defiled, lacerated, reformatted, rendered in 3-D and recycled as PowerPoint presentations.
This is the singular genius of PowerPoint: to render stupidity as genius.” 
That is to say, the bad data is now overlaid with so much meaningless reinterpretation as to be unrecognisable as stupidity. This is the singular genius of PowerPoint: to render stupidity as genius.

This is, of course, all good clean ironic fun, until you realise it is your job that this PowerPoint wizardry will be eliminating.

Sunday, 6 November 2011

The Survivor

It is hardly a heresy to suppose the principles of laissez faire do not apply with the same vigour inside multi-national corporations as they would have them apply elsewhere. 

JUST BECAUSE your business holds the unchaperoned matching of supply to demand as an article of faith, it doesn't follow that its organisational structure will.

Indeed, the bigger the organisation, the more likely it is to resemble a gerrymandered fiefdom of rotten boroughs.

Evidence that "meritocracy, red in tooth and claw" might be more mouth than trouser comes in the form of the Survivor.

Every department, in every large organisation, has one. Even investment banks. Even Goldman Sachs.

“The Survivor's attributes number amongst them laziness, evasiveness, defensiveness, a penchant for creating confusion and a taste for office politics. He is often idle but rarely stupid and, even when he is, will still have an autistic ability to intimidate, befuddle or bamboozle his managers.”

The Survivor is an individual of no discernible value who flourishes through thick and thin, while better men and women perish, are pushed aside, or throw in the towel. The Survivor's attributes number amongst them laziness, evasiveness, defensiveness, a penchant for creating confusion and a taste for office politics. He is often idle but rarely stupid and, even when he is, will still have an autistic ability to intimidate, befuddle or bamboozle his managers. 

This ability to "manage upward" will have no effect on contemporaries, all of whom will see him for what he is, and bitterly resent his callous gamesmanship. But he won't care a jot, realising that, in a rotten borough, what honest toilers think or do doesn't matter anyway.
The "basis" between colleagues and superiors is all he needs to execute his strategy, which is to hang on to the underside of a bridge like a limpet, but to let go just as an open boxcar is passing below.
A survivor may not be paid, or amount to, much, but it will still be more than he is worth.
His developed and unerring instinct for self-preservation may manifest itself in a number of ways:

  • Superb upward management: It may be a truism that colleagues, clients and service providers understand instinctively the uselessness of such an employee (they're the ones who have to deal with him, after all) but his line management will not: the survivor may escape detection through fluency in management speak and the good works of right-minded colleagues who, believing it is a meritocracy and their actions will be recognised, will constantly compensate for him (and, for their trouble, will be penalised for his lassitude).
  • A sixth sense for knowing whose numbers are about to come up: Lagards have been known to survive for decades in the capital markets by picking the right mediocre organisation in which to go unnoticed, staying undetected and unevaluated as long as possible, only to leave just before it implodes through its own systemic mediocrity. There was a well trodden path through collapsing Japanese security houses in the 1990s, into British and European ones in the 2000s, some even making it to the state-owned promised land of Lloyds and The Royal Bank of Scotland where, for all we know they still lurk, now certain to go undetected;
  • Extreme familiarity with the human resources department: Coming to the attention of HR is not considered to be good practice among diligent employees, but a gambler who is prepared to game the inconstancy and ineptitude of the human resources folk - in fact, a pretty good bet - may confuse and frighten those who make the termination decisions to such a point that they are frightened to act. Having a discriminatable-against attribute (and these days it's a broad church - age, disability, marital status, pregnancy, race, religion, sex, sexual orientation, gender identity all get you home, so worst case scenario you can feign transvesticism) certainly helps.
  • "Key man" engineering: A classic survivor strategy. A survivor who is put in charge of an unglamorous but important aspect of the business (and let's face it: this is prime territory for someone no-one really likes) will naturally turn this to his advantage by hoarding all knowledge and material and cultivating arcane, inefficient and confusing procedures around it so that the function could not be carried out in his. Entreaties for simplification and syndication of knowledge will be met with solemn agreement but no action at all.

Friday, 26 August 2011

Group Secretary

An old curmudgeon who opens the mail, mans the phone and sorts out your entertainment and travel expenses? Oh, no.

The romantic view is that the Group Secretary is like Joan Harris from Mad Men: almost superhuman in aspect and outsized in most characteristics: a contrappostally engorged giantess, midway between a gorgon and a siren, by turns brutal, maternal and licentious, yielding quarter to no man under fifty, and certainly not to any star trader or young hotshot.

But Joan Harris is a neatly constructed archetype: each of her aspects, and what aspects they are, is recognisable in any good Group Secretary, but you'll never get them all at once, and the particular combinations you see will generally leave something to be desired. One constant is a dark and visceral loathing of young smart-arses who think they own the place.

Another is the wherewithal to act on that suppurating contempt.

For Group Secretaries, inevitably, have the unqualified and blind support of someone far more important than you. Politically, they are untouchable. It is never wise to cross them, question them, doubt them, banter with them, raise so much as a bemused eyebrow in their direction, or labour in any way under an impression that you are anything other than utterly at the mercy of their every whim. You are food; you are not their friend.

Don't make the mistake of thinking yours might be weak here: a Group Secretary can only develop to a maturity with such a sponsor. Speak softly, and carry a big stick.

The Group Secretary fears no-one other than the Chief Operating Officer, but even then only in concept, because the two will usually be fast friends and allies: a more fearsome bloc can scarcely be proposed.