Case Summary Of Rubin, Stern And Hertz

SUMMARY
Rubin, Stern and Hertz (RSH) an investment banking firm situated in New York is facing a problem of hiring replacement for the star semi-conductor analysts Peter Thompson, who left the firm to join the competitor. Stephen Connor, Director Research at RSH encouraged Peter’s Junior Analyst Rina Shea to stay at the firm to take charge of the upcoming deal with the PowerChip Company. Connor cannot leave this post vacant for long; therefore he landed upon a task of finding a permanent replacement for Peter. He also asked this particular question to himself whether to make a permanent offer to Rina Shea or hire someone from outside.
RSH corporate culture was especially strong in its research division. Instead of competing with each other,
Senior analysts often began as junior analysts and remained at the firm long after the research director gave them their own franchises. Instead of competing with each other, the analysts supported one another; many had open door policies. Each analyst strove to become ranked by the Institutional Investor Magazine II; although many considered the success of the research department as wholly if not more important. It was common for RSH employees to develop contrarian views on stock. Teamwork led to superior company coverage. As an additional incentive to teamwork, the director of research tied analyst’s bonus not only to individual success but also to the success of the group. At the Semi-annual offsite retreat, analysts could work on their analytical and writing skills in focused workshops and participate in exercises aimed at fostering communication, trust and commitment to the firm. Senior analysts mentored junior analysts and there was formal training program to mould promising analysts into superstars. It was uncommon to reject offers of 15-20% pay increases at the firm because employees like the atmosphere encouraged by RHS. Therefore the turnover was very low. RSH was dedicated to their employees and the same was expected by the employees to the
CATEGORIES RHS GOTZ & LOEB SPENSER’S AND COMPANY WHS JEFFERSON BROS.
Culture Team work, open door policy, the company dedicated to the employees and vice-versa. No team work, disdained formal business culture. Traditional full service with elaborate organisation structure. Firm’s formal managerial style and standardized procedures Have minimal managerial staff. No guidance, freedom. Independence, minimal managerial authority.
Compensation Uncommon to reject offers of 15-20% pay increases at the firm because employees like the atmosphere encouraged by RHS Many analysts covered unknown companies which generated lavish commissions for Gotz and Loeb Analyst’s compensation was based on whether they met the goals outlined in their plans. WHS offered very less salaries- analysts were expected to earn the rest of their compensation through bonuses. Linked according to the