CASE ANALYSIS: ROB PARSON AT MORGAN STANLEY (A)

Principal Performance Issues at Morgan Stanley

Morgan Stanley, a forerunner in investment banking, had struggled to provide financial services
companies with capital market services. This was because of a number of problems that were
caused by a variety of factors, such as a high rate of turnover in a lower amount of transactions
because of high interest rates, understaffed bank group, and trading coverage. The market coverage
professionals needed to be quick-witted, aggressive, and have a good relationship with clients in
order to aggressively bargain with clients and build this business segment. Nasr hired Parson for the
position in order to achieve this goal, but despite the fact that he brought a number of interesting
qualities to the table that won transactions and expanded the business function, there was
dissatisfaction among the company's internal employees.

Rob Parson's performance assessment and its implications

The feedback from the 360-degree appraisal system was used to assess Rob Parson's performance.
The internal stakeholders at Parson provided a lot of less-than-ideal comments. Although Parson's
emotional outbursts demonstrated a lack of respect for his coworkers and other organisation
members, Morgan Stanley's culture values teamwork and respect for others. He had a great
relationship with every client, though, and he worked incredibly hard to enhance the company,
therefore he received acclaim from external stakeholders like the clients. Nasr was required to
decide whether he can be considered for advancement from principal to managing director by his
division as a result of such a performance review. The input would be disregarded and accusations of
favoritism would surface if Nasr opted to move forward with nodding him for the promotion.
Conversely, if Nasr doesn't go through with putting him up for the promotions after verbally
informing Parson about a potential promotion at the time of joining and ignoring all the results that
Parson had brought into the division, Nasr runs the risk of losing Parson from Morgan Stanley.

Is there anything that might be done to fix the PM system?

The 360-degree appraisal has various drawbacks even if it is a useful approach for learning how an
individual is seen inside the organization. The possibility of biased reviews is not taken into account.
This scenario demonstrates that it is not objective because the performance review procedure
makes no mention of Parson's quantifiable accomplishment in the industry. This approach also has
the propensity to emphasize the negative aspects of feedback and areas for growth while ignoring
the ways in which workers can be constructively reinforced, encouraged, and rewarded for their
current good work. So, the organization should look for ways to enhance or upgrade upon these
current shortcomings or look to convert to alternative methods like constant feedback etc. In
addition to appraisal procedures, the organization should find a way to include adherence to the
organization's culture and norms as one of the performance goals so that workers are expected to
behave in the appropriate way right away.

Lessons learned by both the organization and the individual

Rob Parson's efforts notwithstanding, promotion following such a performance assessment would
only result in a significant disturbance of the division's working environment. Nasr needs to explain
to Parson why he wasn't given a promotion right away and come up with ways to improve his flaws,
such as being "less aggressive" and "learning patience," among other things. Parson may learn a lot
from this as he figures out how to fit into the culture of Morgan Stanley and still meet clients' needs.
Nasr, on the other hand, should recommend that the company reassess Parson after a certain
amount of time (say, six months), and if he does well in terms of improving in his weak areas, then
he should be considered for promotion. In order to prevent permanently losing Parson during the
period of re-evaluation, We must make sure to give very good and consistent feedback as well as to
emphasise the excellent work that had been done up until that point.

The organisation should modernise its performance management system to account for the various
working styles and employee objectives that are needed in various departments under various
conditions.