So here’s my breakdown of what is going on inside Vanguard. The company (long known for paying below industry standard ) was considered a solid place to gain experience and begin a career in the financial industry, and much with any carrot and stick routine in the corporate world, the ability to move up was something that was held out as a solid possibility. Mix that with a good PTO policy and solid benefits and it seemed like a potential place where you could grow for more than the minimum amount of time to make yourself attractive to other employers who might pay you more
I can confirm after three years that this is NOT the case. A couple years ago Vanguard paid 10 million dollars to bring in the consulting firm McKinsey to assist in handling efficiency due to logistical problems from the company’s rapid growth. Rather than simply pay the employees more to increase retention and fix the inherent staffing problems for good, they paid McKinsey an exorbitant amount to reshape the company and how it will interact with the clients. Embracing a factory “efficiency center” model as opposed to a well staffed relationship based firm that it had been in the past.
I used to work in a department known as Flagship. This was the for the high net-worth clients with over one million dollars. While the initial role was comfortable, offered good experience and potential growth, the McKinsey transformation has changed everything. The motto for this position should be RMS: “The Wage Slave’s Winter of Discontent”. Constant micromanagement, complete arrogance from the management team and the greatest display of willful ignorance that I have ever seen.
Pretty much the company started to accelerate in a downhill fashion starting at the end of 2018 when they unveiled “ BLUEPRINT” This was just a repackaged McKinsey “transformation” that had been done in other departments which has now been unveiled company-wide. Side note: I remember when they had an expo for the employees of the department where they were first unveiling what McKinsey would be bringing to the table and the lead exec (who is now in an even greater position of authority) had three sessions. AT EVERY SESSION he brought up on the powerpoint a picture of his daughter and would get choked up and say the line “I always get choked up looking at her photo” (she’s alive FYI) to emphasize how McKinsey and their “lean management” had assisted in helping to create the hospital she was treated at.. I am wary of those who hide behind children to pull on the heart strings of others… Especially when its clearly an act done three times in a row to make an impression on employees. This should give you an insight into the psyche of the management team. But I digress
RIG BLUEPRINT was preceded by an intense focus on numbers and metrics. Where before our high networth clients were given time and we were told to treat handle- time as “merely a guideline” and build relationships by offering investment guidance to keep our clients on course, what has now resulted is a pure factory. Relationship building, empathy, and common sense have all been sacrificed upon the altar of “Efficiency”. Investment guidance conversations have been totally taken away as a standard practice that was part of your expected role. EVERYTHING IN THIS COMPANY HAS GONE TO NEGATIVE REINFORCEMENT and is structured to be your fault if you’re not able to be as efficient as possible. Have a 90+ year old who needs a password reset? Get him off the phone as fast as you can or the metrics will suffer. Got a retiree who knows nothing about investments and wants to put everything in the highly speculative Healthcare Fund? Be ready to say “ok sir!” and push the button since spending a few minutes to educate the client and perhaps have a rewarding interaction that day is far too much time wasted in Vanguard’s eyes if the client isn’t completely ready to have Vanguard manage their account and get them into an advisor’s already strained book.. How about a grieving widow who lost her husband and needs someone to talk to and just a bit of a direction now that the dust is settled? Too bad! Unless she is interested in Personal Advisory Services and signing up for a managed account, she means nothing when it comes to your metrics. You want to have empathy, you want to treat clients well. But the management team of Vanguard has made the environment so unbelievably toxic that it becomes a “you vs them” dynamic when it comes to the client. You’re going to be fighting a two front war. On the one hand you have management breathing down your neck… on the other…. client requests. Something has to give. And in the interest of efficiency, the client’s job is not the one at risk when it comes time for the end of year review.
This has obviously caused huge morale problems which are now rampant with murmurs of cursing about the job function on everyone’s breath
If you’re spending too long unavailable from the phone (likely creating a case to be assigned for followup due to the complex nature of some of the requests received throughout the day) be prepared for a random Team Leader (TL) to “check in” on you with the standard inter-office passive aggressive chat of “I noticed you’re unavailable for over x amount minutes, everything ok??” This is merely a ruse to make sure you’re working on something important and heaven forbid you need a mental break from the non-stop onslaught of calls. Speaking of break. Do you ever use the bathroom like a normal human being? Well hopefully you can get everything done in the 30 minutes allotted for break time… otherwise, as with everything else, your metrics suffer. You literally have to log the time you are doing a bodily function as break time… BATHROOM TIME SHOULD NOT BE CONSIDERED BREAK! This borderline illegal policy is just one more thing to add to the milieu of problems at this place. The mental strain of this place is beyond words. TL’s (supervisors), who have all drank the Koolaid, walk around with their laptops constantly monitoring you remotely and making sure you are working. The new tactic they have employed is to see you’re unavailable and rather than send you a chat, they will walk over and creep up on you to make sure you’re at your desk if you’re showing in “unavailable” status. If you’re not at your desk (say perhaps to go to the bathroom) and they catch you. Rather than speak to you like a normal human being, they will write to their manager and your direct TL reporting the issue. It is like being in Maoist China wading through a network of informants. Do the wrong thing and you’re on a list. If you’re ever in this role, just note, YOUR TL IS NOT YOUR FRIEND! They will smile in your face and use buzzwords about wanting you to “be candid” and “transparent” how you should “have a critical conversation”, BEWARE these are scripts to get you to show your cards. Its actually really creepy at this point dealing with the TL’s. You may have heard the common criticism that Vanguard is a cult. Well I can confirm ITS TRUE.
The behavioral conditioning is more apparent than ever in the absolute jokes that are quarterly meetings. At one of them, they passed out little red paper books with the words “WE” written over them (because only the best cults include a bit of Soviet Russian flair right?). Inside the book there were basic platitudes on Vanguard and “doing the right thing” or “being there for clients”
The leader of this meeting (the head of Flagship) standing at a podium with his captive audience in front of him played a video. Cue 5 min of B-roll footage of inspirational events and a voice over on Vanguard. He then asked everyone to “turn to page 22 and please lets all take moment to read and reflect on that”…. Again it was a page of platitudes, but as I looked across the crowd seeing heads bent looking at their little books, it dawned on me how far this place had sunk. I was appalled that they would try to conduct this meeting as if it were a religious gathering and infuse so much symbolism to try and force a point into the lives of people who are just trying to do their jobs and feed their families.
Speaking of jobs, the whole department is undergoing a radical shift. So one of the major issues is that Vanguard was skirting SEC/FINRA rules for years by having representatives sell advice… The problem is that in order to be within FINRA compliance for “selling advice” the representative doing so, needs to have a series 66 (I.e have the qualifications to actually be a financial adviser). But Vanguard for a long time was making it part of the crew’s metrics to push clients to enroll in our Personal Advisory Services program. These were considered “soft sales”. Pretty much you were and still are expected to generate 4-8 leads per month otherwise your metrics would underperform. Now, Vanguard is getting ready to make a big push for advice by selling it harder than ever before. All crew in the former flagship area now renamed “RMS” (relationship management and sales) will be licensed with the required 66 and be responsible for seeking out and uncovering leads from clients. Representatives will now have a higher emphasis on advice leads for their metrics. Sales tactics are being implemented such as “if a client seems interested in PAS but gives you the excuse of “I will have to talk to my spouse”, go ahead and reply with “great, lets have that conversation! Are they available tomorrow for us all to talk?”… tactics straight out of a used car salesman’s book. Additionally, the assigned representatives are now being shifted to an entirely new role and will no longer be there to maintain any relationships with their clients. Gone are the days where someone with millions of dollars could call a person who was there that they knew on a first name basis
Keep in mind, the culture of Vanguard was to never sell… but after John Bogle’s death that mantra has gone by the wayside. I just want to say…. If you are a young and energetic college grad looking to get their feet wet, or a tenured professional who may be considering Vanguard. I would beg you; please please please DO NOT CONSIDER THIS PLACE! It does not matter if it’s the retail side or the institutional side, the McKinsey efficiency model (a model again used primarily for sweatshops and factories) is being brought out to all ends of the company. Vanguard is a sinking ship that is right now hemorrhaging talent. You have people who are miserable. The tenured older folks are going into work terrified its their time to be axed because of something so simple as an innocuous joke or simple comment over the inter-office chat.. Young adults in their mid 20s already have gray hairs from the daily stress (not a joke) and this misery mill which is like a sad re-enactment of the movie “Office Space” groans onward into the abyss.
