Secrets to Success on Wall Street: Teamwork, not EgoPublished: January 14, 2005 in Knowledge@Wharton
Wall Street firms need to tone down the aggressive, superstar culture of the financial industry, according to Sarah E. Nash, vice chairman of investment banking at J.P. Morgan Chase & Co., in New York. Leadership, she told Wharton students during a talk on campus earlier this fall, means an individual's ability to realize it's not about 'me' anymore.
A 26-year veteran of Wall Street, Nash said that in the last three to four years, corporate clients have grown increasingly turned off by the industry's bravado. Clients can no longer stand that attitude, she said. "We don't want movie stars anymore," she added, suggesting that when smart, hard-working individuals put egos aside to work as a team, they end up creating a better business. "You become a franchise builder. You develop equity in the home in which you live."
With assets of $1.1 trillion, J.P. Morgan Chase & Co. is the product of a string of mega-mergers, including its $59 billion acquisition of Chicago's Bank One in July. In 2000, J. P. Morgan and Chase Manhattan merged. Prior to that, Chase had combined with Chemical Bank in 1995 and Chemical Bank had merged with Manufacturers Hanover Trust Co. in 1991. Nash said that when she meets employees at the bank she can almost always tell if they came from J.P. Morgan, Chase, Chemical, or Manufacturers Hanover. "The toughest thing to do is get people to act like leaders in the new organization and let go of their heritage," she noted.
J.P. Morgan Chase is the second-largest bank in the U.S. behind Citigroup, which was the world's largest before the merger between Japan's Mitsubishi Tokyo Financial Group and UFJ Holdings was completed in October. Jamie Dimon, Bank One's former chief executive, who will ascend to J. P. Morgan Chase's top job by 2006, is ready to take on his former employer, Citigroup. Dimon had been the protégé of Citigroup chairman Sanford Weill, but was ousted in 1998.
J.P. Morgan Chase is superior to Citigroup when it comes to fixed income business said Nash. "That is our legacy. We have better bankers, stronger bankers." She acknowledged that Citigroup has a better national and international banking presence, but said J. P. Morgan Chase is already incorporating the Bank One operations and will begin to roll out new retail business in the United States, under the Chase brand, in 2005.
J.P. Morgan and Bank One are not working to integrate their private equity businesses, with J.P. Morgan's unit holding the upper hand, according to a recent article in The Wall Street Journal. J.P. Morgan is expected to spin out the Bank One private equity unit as an independent entity after it spends the remaining $700 million that J.P. Morgan committed to Bank One's $2 billion fund, the Journal reported.
Learning to Drink Stingers
A native of Montreal, Nash graduated from Vassar in 1974 and was offered a job in Toronto with J.P. Morgan right after college. She turned it down and joined IBM instead so she could move to New York. Her first boss at IBM told her to cut her long blonde hair. "You don't look serious," Nash said he told her. "You look like you're still on your parents' payroll."
After 18 months at IBM, she joined J.P. Morgan's Midwest sales division, one of just a handful of rising executive women at the bank. "It was an era when women were few and far between. It was always 'me first.' You were always racing to be picked" ahead of the others. She remembers being handed a less-than-promising client list and sitting at her phone each day as the top boss and his second-in-command went out for lunch together. Finally, she got up the courage to invite her boss to lunch at the cramped coffee shop where she ate on her starting salary. She complained about her client list and was soon given some choice accounts, including Sears, Roebuck and Co., which set her career in motion.
Nash advises industry newcomers to be open with superiors, because they need to know what is going on at all levels of the company. "You have got to stand up and tell us." Nash herself was aggressive about getting to know her bosses and coworkers, encouraging them to go out for drinks after work. "Back then, a lady wouldn't have done that," she said, adding that she had to learn to drink a stinger. "You need to reach out of your skin and get to know" your colleagues.
Her career success, Nash notes, is due in part to being in the right place at the right time and having a succession of good bosses, although she did have one boss who was a clunker. "We couldn't get on the same page," said Nash, who was too intimidated to confront this person although she suggests that intimidating managers often suffer from their own lack of confidence. Now, she said, she would advise people in that situation to go over the boss's head or contact human resources.
Nash contends she was lucky in that her career provided mobility and new challenges that repeatedly pushed her out of her comfort zone. During her first 10 years at J.P. Morgan, she held various corporate finance positions with client responsibility for Morgan's banking business in Chicago and New York. In 1987, she was named a managing director and made responsible for leveraged finance. From 1990 to the present, she has been actively involved in leading client development and investment banking management for the firm.
Real Style vs. Hairstyle
At some point, Nash said, young people change from being led to being leaders. "We need people to behave like leaders from the minute they walk through the door." According to Nash, the firm cultivates leaders who exhibit trust, integrity, and character. "We spend a lot of time pushing these principles in our people." J.P. Morgan Chase puts an emphasis on "gravitas," which Nash described as "real style versus hairstyle."
When asked who she looks up to as a leader, Nash named Oprah Winfrey, whom she admires because the talk-show host has been able to touch people with her willingness to speak openly about controversial subjects. "Oprah awakened a whole generation of people to be more sensitive and understanding."
Nash was also asked how she maintains balance in her personal life. She is divorced and remarried with two children and four stepchildren. "I didn't do a good job of it," Nash conceded, adding that newer generations of employees at the firm seem better able to juggle their personal lives and careers in finance. "Our industry organizations have lost a lot of people. We burned a lot of them out." At one point in her career she took a year off; her manager said she could take two, a move that cemented Nash's loyalty. "Even if the place was on fire I would do anything for [the company] because of that year."