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S G Cowen: New Recruits

We are who we recruit. The quote describes how the organization defines itself and highlights the
S G Cowen strategy to achieve sustainable competitive advantage through the effective human
resource management. Since people define the organization, the hiring becomes the single most
important process in creating a differentiated competitive value proposition. The recruitment and
hiring process starts with deciding what positions to fill, building a pool of candidates for these jobs,
using selection tools, and deciding whom to make an offer. Goals of hiring are attract and select high
qualified performer who is aligned with organizational culture and vision at minimal cost.

Recruitment philosophy varies from organization to organization. It can be external, internal,

diversity based, lateral, campus hiring, hybrid etc. Internal sources of candidates has several
advantages, as in their strength weakness aspirations are known so assessing applicants fit with
requirement is relatively easy. In general, external hiring is done through series of interviews and
other selection tools. Careful employee selection is important for several reasons: organizational
performance depends upon the employee, recruiting and hiring cost, legal implications, and
potential defamation. A selection interview is a selection procedure designed to predict future job
performance based on applicant responses. One reason selection interviews are often less useful
than they should be is that managers make predictable error that undermine an interviews. The
interview panel should not jump to conclusion based on preliminary information and should explore
deep down into the background and the personal characteristics clarifying the match with what the
job really requires. The focus of interview should be to verify the information, and to probe personal
characteristics such as motivation, creativity, entrepreneurial initiatives, goals, interest, intellectual
abilities, values etc. The interviewer should be free from all types of biases and perceptual errors.
The manager should design and conduct an effective interview before extending the job offer.

Recruitment at S G Cowen
S G Cowen recruits three categories of applicants. First category includes analysts who were
promoted to first year associate after completing 3 years as analyst at the firm without going to
business school. Other associates started out as intern in summer during business school
programme and subsequently were offered full time employment. Third category is hired directly
from business school through series of interviews. First two categories of recruitment can be
classified as internal recruitment where as the last category is external hiring.

The hiring process for new outside associate hires begins in the fall, when SG Cowen makes
presentation at its core business schools. Rae modified the core school strategy so as to focus on the
top of the class and therefore extended the scope of core school from top 10 schools to top 25
schools in US. At each of the core schools, S G Crown scheduled the company presentation educating
students about the company and promoted advantages of being a boutique firm. Post presentation
interested candidates are invited to S G Crown office to interact and learn about the firm. Though
this process was not evaluative, it provided some insight about the candidate.

Next stage happens to be on campus round. In this round students are interviewed and screened
for next round Super Saturday Round. On campus rounds are conducted by associates because
they can better test skill sets and cultural fit. This ensures senior management can be involved on
the final stage, without wasting time in initial processes. The shortlisted candidates are invited to S G
Cowen office for five interviews by senior management. The candidates are evaluated on patterns
of success demonstrated in past, extent of love and passion for the job, commitment & loyalty,
interpersonal skills, team player attitude, maturity, technical knowledge, and versatility. Based on
evaluation the candidates are offered to join the firm.

As per Rae he tries to get people to act and behave like a firm so he thought through entire selection
process. He wanted to make sure bankers were not overly partial to candidates from their own alma
maters and also that bankers hire people who would only succeed in any team. In spite of all efforts
there are some concerns in selection process. Firstly there are biases of interviewers who strongly
supported their candidates. While discussing the candidate profile post interview, a number of
panellists may nod out of confirmatory pressure. These biases need to be removed to test the
suitability of candidates objectively. Following recommendations if implemented may enhance

1) The interviewer panel may present their insights and assessments. Based on these
assessments and clarification other people may decide or rank the candidate. Post
discussions candidates are selected based on overall ranking.
2) Rae should look into the candidate assessment from broader organizational perspective.
3) Interviews are held on Saturday, a normal off day. Panellist has to part away with their
personal time to conduct interviews. Either the interview should happen on working days or
panellist should be compensated for the loss of day off. Otherwise few interviewers may
tend to wind up the process by selecting candidate superficially.
4) More methodology could be involved to test the cultural fit of individuals.
5) Personality tests could be used to determine the personality match with nature of job. This
may in turn help to judge loyalty and retention dimensions.
6) Due to uncertainty in acceptance rate of the offer by the candidate, the numbers of offers
are more than required. This increases cost of recruitment therefore the firm device some
mitigating framework.

Candidates for Hiring

In hiring meeting a number of candidates were selected, leaving four probable candidates for two
positions. Out of four may be two would turn out to yes.

1. Natalya Godlewaska

Finance background and her understanding of financial market
Excellent reference from previous employer, and academicians
Analytical Skills
Highly determined and ambitious
Go-getter and can do attitude

Stiff, inflexible and uncomfortable during small talk
Not fluent in English, lacks interpersonal skills
Cultural misfit

2. Martin Street

Substantial leadership experience
Better interpersonal and communication skills
Dynamic personality, culturally fit, confident and articulate
Mature and high on ambition

Low on loyalty, not sure whether he would accept the offer
No relevant work experience
Cultural misfit

3. Ken Goldseitn

High flyer, risen to manager at PWC within 5 years
Excellent reference from previous employer
Mature and strong leadership skills
High on ambition and initiative

Apprehensions on his commitment as he has personal responsibilities that is against
normal culture of first year associates do not have life.

4. Andy Sanchez

Entrepreneurial background
Enthusiastic, personable and great at making people feel relaxed
Well informed and connected. Showed genuine interest in S G Cowen

Apprehensions on competence as GPA is low, though has high GMAT score
Apprehensions over commitment and loyalty as he owns his business

Selection should be in line to opening the quote We are who we recruit. Not only the success but
also the identity of firms depends upon the quality of human resource in the firm. Potential mistakes
while selecting employee have very high future costs. Keeping in mind the organizational
requirement the most suitable candidate will be Natalya Gadlewska. She has strong academic
background in functional domain and excellent references. This strength signifies her strong base on
that she can build her career. Her high ambition and positive attitude will help her to surpass any
obstacle that may come in the journey. Being a female, multi-lingual, and multicultural bring
diversity in team. The diversity also implies the natural dynamism she carries. Only major
apprehension about her not so perfect English and social skills seems superficial considering her
talent, intent and ambition. Person with intent and talent can evolve to any extent in due course of
time. Considering her excellence in functional domain, she has time resource to improve upon her
English. Her diversity will help her to lead the divisions across the globe. Considering the skills
required as associates in Investment Banking, she scores fairly high on almost all parameters. If she
evolves with due process of time, she may emerge as industry leader.

On similar lines of intent, attitude and competence the second candidate will be Ken Goldstein. He is
a high flyer and has proven his skills and attitude in previous roles as confirmed by references.
Everyone who interviewed him liked him and found him fit for the S G Crown. The only reason he
was not selected immediately is the apprehension over his commitment conceptualized on the basis
that he is married and has children. The commitment of a person has more to with internal
motivation factors rather than externalities. This conjecture that he may not work 24X7 is based on
biases and doesnt take in to account his ability and motivation to manage work along with family
affairs. His elder son is 2 year old, that means he has having family life since he was flying high in
PWC. It is the intent and ability of a person that determines his commitment and success not the
external factors.

Other two candidates are talented but can be ranked lower when their strengths and weakness are
matched with S G Cowen requirement. Through Martin Street has proven leadership experiences, he
lacks functional knowledge as well his loyalty is doubtful. Major concern regarding Andy was
actually his low undergraduate GPA. He has been running his own business that may lead to
divergence of his personal goals and organizational needs.