Making MD at Goldman: How it happens Those who made the investment bank's final cut play it cool, but not everyone makes the grade Getty Images By Portia Crowe November 15, 2017 Updated: 6:28 p.m. GMT Making managing director at a top global bank like Goldman Sachs is among the most prestigious promotions in the industry. With the total population of senior staff steadily declining at the bank, part of cost-cutting measures outlined earlier this year, the MD rank — one step below the highly-coveted title of partner — is also becoming more difficult to attain. This year’s class of 509 people, announced last week, is larger than in 2015, the first year Goldman Sachs switched to promoting biennially rather than annually, but smaller than the combined classes of 2012 and 2013. In classic banker style, many of those who make the cut play down its significance to their careers. But in reality the months-long, confidential selection process can be intense. One Asia-Pacific-based MD said that to cope with the pressure of the selection process, he resorted to reading a self-help book on managing stress. The entire process takes four or five months from the moment senior executives begin seeking input from managers as to who should be considered, until the final decision is made in November. Candidates do not officially know they are in the running, but most will have made it known they would like to be considered for MD. They typically have informal conversations with managers before the process starts around June. READ Goldman Sachs suffers another heavy fall in bond trading “The first six months of the year you need to make sure you have the right cards to be in the process,” said one London-based member of this year’s class. Candidates must demonstrate commercial effectiveness and an ability to enhance the value of the firm, which for front-office employees might mean you are bringing in business and your business ranks on the league tables or is profitable. You must also show signs of leadership such as mentoring junior staff. Next is what is known as the “cross-ruffing” process — a bridge term appropriated by former Goldman Sachs chief executive and US treasury secretary Robert Rubin — where evaluators solicit feedback on candidates from a broad group of managers outside of their division who have worked or been in contact with them. That is followed by a consultation period with leaders of the candidates’ divisions. READ Lloyd Blankfein explains why he won’t ‘pooh-pooh’ bitcoin Final decisions can go right down to the line, and not everyone who goes through the procedure succeeds; some endure the stress and pressure of the process multiple times and never advance beyond the rank of executive director. So what does the promotion mean to successful candidates? “It doesn't really mean much, obviously – it's just a title,” said the London-based employee. “Clearly you want to grow in the organisation if you're ambitious, so you have to get to that title to get further responsibility and then make it to partner.” And, of course, it typically comes with a pay rise. Another London staffer, who identified as “a bit older” than some of the other candidates, said: “It wasn’t particularly going to destroy me one way or the other — it was really just a bit of relief,” adding that among other things, the new title means validation for one’s work. “You do your job well and get recognised for such.” The cathartic release for successful candidates officially comes in the form of a phone call or meeting with direct managers shortly before the new class list is announced internally (the announcement is held until each person has been briefed). But the real nod comes the day before the announcement, when unsuccessful MD hopefuls are pulled aside and informed in advance that they have not made it. Having passed that final hurdle, candidates can safely assume they have been chosen for promotion. “These people are ultimately future leaders of the firm,” said the first London-based MD. “So, yes, it makes a difference.” To contact the author of this story with feedback or news, email Portia Crowe https://www.fnlondon.com/articles/making-md-at-goldman-how-it-happens-20171115