case study

Proposing Leadership

As discussed, SG Cowen delegates significant resources into the recruitment of prime candidates. Unlike traditional Wall Street recruiting, the company moved from recruiting candidates as solely “core” schools in an effort to attract top talent regardless of school choice, instead of average candidates at top schools. Pfeffer would commend SG Cowen’s selectivity in recruiting as it ensures new hires are i) capable, ii) compatible with company culture, and iii) loyal to the company (Pfeffer, p. 97). In theory, Rae’s recruitment science attracts appropriate candidates. The problem arises when upper management, who embody and understand the company’s vision, are removed from the early process. Instead, junior and mid-level associates lead the first interviews and potentially weed out those with “personality” and “sparkle”, as Bill Buchanan noted.

While the recruitment process is arguably flawed, SG Cowen is set apart in their organizational structure and leadership’s involvement. Because of their decision to retain a boutique-sized firm, the company is better able to affect cultural changes (p. 103). Additionally, the company employs symbolic egalitarianism in their commitment to ensuring peripheral offices have equal access to resources as with their central and corporate offices (p. 101) SG Cowen’s CEO Fennebresque is exemplary of Proposition 8: Leaders Reveal Weaknesses and Proposition 7: Leaders are the People. Fennebresque managed to turn the weakness of his non-finance background into a hallmark of SG Cowen -- that is, what sets the company apart from other Wall Street firms. Because of his celebration of candidates from non-traditional finance backgrounds, Fennebresque created a diverse culture of thought and perspective, and a more loyal workforce who are thankful for the chance to succeed. Furthermore, Fennebresque’s active involvement in recruiting and his accessibility to junior staff demonstrates the idea that he is in the trenches alongside his associates.

Judgement, Decision Making, and Creativity

SG Cowen has grown into one of the largest and most successful financial services companies in the United States and global market. The success of the company has been attained through consistency in internal business processes such as decision-making processes. In project-related judgements and decisions, the company starts by identifying the specific problem or issue that needs improvements through decisions. This involves consultation among various stakeholders such as directors and managers to assess the prevailing issue. For instance, when the company is deciding to make an investment or extend a product line, all stakeholders are engaged to ensure they contribute to the identification of all necessary variables in the decision. One of the instances at which the process was evident is during the introduction of the new hiring process adopted by the company. SG began the process through convening meetings where the stakeholders contribute to the prevailing issues.

Furthermore, SG Cowen ensures quality of decision-making by leveraging the availability of data. Data is collected through research activities which focuses on collecting all necessary variables in the related field. Data enables the managers and other stakeholders to make more informed decisions. Also, the company collects market data such as trends to ensure the decisions made are up to date and match the prevailing needs at the market and industry.

Recruitment

SG Cowen has a very unique hiring process and the decision-making process used in determining the success of a candidate. The employing system in the organization depends on the procedure of picking the best up-and-comer in the Masters in the MBA program from the top business schools. The applicants picked are consolidated into the organization's partner programs. Despite the fact that the organization is searching for the best ability, the measures utilized in choosing the volunteers don't get a capable competitor. The enrollment and the recruiting system are in any event, testing. The contemplations to the key positions incorporate the high scholastic exhibitions and impressive occupation achievements.

The criteria used by the SG Cowen Company has a unique way of determining the eligibility of a candidate in a given position. A significant region the organization was thinking about incorporates extraordinary scholarly accomplishment especially in business. Likewise, the competitor should show the right demeanor and energy at work to be given. Different ascribes the organization was thinking about incorporating relational abilities, social advancement abilities, culture and relational abilities. The models utilized by the organization to enlist the best applicant are testing and don't get the skilled competitors required. The recruiting system starts by visiting business colleges giving the data with respect to the organization goals and the employing system to the expected competitors. The meeting and the data arrangement measure is trailed by the meeting, which is long and includes complex cycles. As the case demonstrates, the recruiting standards in the organization have numerous issues. In the first place, the financial experts embrace the employing measures rather than the HR chiefs. HR experts are attempting to employ abilities and skills in the recruiting system. Along these lines, utilizing the financial experts was an incredible slip-up (Laschever & Weinstein, 2021). Because of the absence of formal preparation in the enrollment interaction, the SG Cowen workers wound up with enlistment models that generalized their up-and-comers. The enrollment group considered factors like the conjugal status, the sort of English the up-and-comer use, actual appearance just as other individual credits that don't enhance the firm.

Staffing, Selection, and Law

While not explicitly stated as a recruiting guideline, SG Cowen demonstrated discrimination in the staffing and selection process by considering a candidate’s parenthood status as a factor for his employment. The firm is giving parents a disadvantage in the recruitment process by denying employment on the assumption that parenthood will affect an individual's performance negatively. Parenthood can arguably fall under the Personal-History area of employment case law.

A number of bankers at SG Cowen also demonstrated national origin discrimination in their consideration of a foreign candidate. The Equal Employment Opportunity Commission (EEOC) would not consider English-only rules fair unless there is a business justification or need. The notes provided within the case study indicated that the foreign born candidate was well educated and would be able to competently perform the job, albeit at a potentially slower pace due to English being a secondary language.

Perception, Attribution, and Performance Appraisal

Although Rae had made the bankers make a case for their candidate, there are obviously going to be potential biases for each person. Each candidate will have a different perception of how well the candidate could fit in based on how strong their case was made. The bankers who wrote the case could also be giving misleading information that would make a candidate seem more qualified then they actually are.

There are also plenty of other ways candidates could receive an unfair advantage during the interview process. Each candidate could be stereotyped which would lead to the process of categorization, homogenization or differentiation. All of these stereotyping processes could lead to preconceived thoughts on an individual based on their race, gender, culture, social status etc. It’s also important to note that not all stereotyping is intentional. These perceptual biases of the candidates occurs as unintentional (systemic) discrimination due to the decision makers having already establish notions of an “ideal” candidate for the role.

Ability, Personality, and Values

When selecting the new recruits, SG Cowen evaluated a candidate based on their ability, personality and value. As we look at the SG Cowen Investment Banking Division Associate Evaluation Form, there are several different sections on how they evaluate each person. As of now, each candidate’s interpersonal skills are evaluated by their impact/ presence and communication skills. Their leadership ability is determined by their initiative and motivation. A way that SG Cowen can evaluate each candidate’s interpersonal skills and leadership is to use the five-factor (big five) model. This model will help break down the five most representing personality traits: conscientiousness, agreeableness, neuroticism, openness to experience and extraversion. It will help the company recruit members based on the personality trait they are looking for.

From the information given on exhibit 1, candidate Bill Berry would score high on extraversion as he was considered to be a good salesman. However, Berry’s score on conscientiousness would be considerably lower as the interviewers thought he would need to be carefully managed and falls short on the number crunching. The next candidate, Sam Damon would score low on extraversion and openness to experience. The interviewers considered Damon to have a weak presence and not an original thinker. The third candidate, William Xu would score low on conscientiousness as he lacks the proper skills and was not considered to be “polished.” The last candidate, Sara Wicher would have a high neuroticism score as she showed a negative attitude during the interview.

Motivation

One of the most important considerations when considering candidates for a role is what motivates them. Studies have shown that employee engagement predicts employee and work unit performance. However, these same studies have shown that 53% of the workforce is not engaged. This signifies the importance of SG Cowen’s conundrum of electing candidates to join the team, not only do they risk the new team member not performing; but also bringing down the team with them. When evaluating candidates based on their motivation and engagement, it is apt to consider that drives shape needs; these needs imbued with social norms and past behavior lead to our current behavior and decisions. A great example of this is found in the case with the candidate Martin Street. Although he is applying to a civilian job; his drives are shaped by his past experiences in decision making in his four years in the military.

It is critical we understand what drives our candidates, whether that is the drive to acquire, the drive to bond with fellow bankers, the drive to comprehend or the drive to defend. These are all examples of both intrinsic and extrinsic motivation. An example of intrinsic motivation in this case would be Natalya Godlewska’s desire to achieve success despite language difficulties. Whereas Ken Goldstein’s desire to provide for his wife and children would be an extrinsic motivation that bankers would foresee clashing with his intrinsic motivation to spend time with them.

The final consideration for motivation in this case lies in the future of SG Cowen. The Expectancy Theory of motivation states that we will work on behaviors that people believe will tend to lead us to an expected outcome. This means we should consider in these candidates which behaviors they have already manifested in order to get where they are, and if they will need to make any drastic changes to their behavior to achieve our expected outcome at SG Cowen.

References

Laschever, R., & Weinstein, R. (2021). Preference Signaling and Worker-Firm Matching: Evidence from Interview Auctions