John Thiel, Bank of America Merrill Lynch's new boss, has put his own stamp on the business with a revamped and leaner management structure.
But some wonder if he might be taking on too much responsibility.
Mr. Thiel, head of global wealth management at Bank of America Corp., laid out the new, flatter management structure for the company's U.S. wealth management and private-banking and investment groups in an internal memorandum sent Sept. 21.
Gone are the three divisions to which Merrill's 16 regions used to report. In turn, there are now 11, each to be led by a market executive who will report directly to Mr. Thiel.
The revamp also eliminated a parallel reporting structure previously used by Merrill's high-net-worth Private Banking Investment Group.
Mr. Thiel, who took over three weeks ago after the ouster of global wealth management chief Sallie Krawcheck, called the change a “market-driven, client-driven and streamlined” arrangement for the firm.
The reorganization isn't surprising.
“Firms reorganize all the time,” especially with a new boss, said Mindy Diamond, president of recruiting firm Diamond Consultants LLC.
“But is it due to cost cutting,” she asked. “That's how it's being received” by Merrill brokers, who Ms. Diamond said are worried about loss of support.
The 11 individuals named as regional market executives are all former financial advisers, said Ron Edde, a recruiter at the Armstrong Financial Group Inc.
That should help “quell a concern” that bank people might take over after Ms. Krawcheck left, he said.
Mr. Thiel also is a former adviser.
CAN HE KEEP UP?
Still, some observers wonder if Mr. Thiel's new management structure might be too lean. The list includes Brett Bernard, mid-East; Chris Dupuy, Pacific Northwest; Linda Houston, New England; Paul Lambert, mid-America; Bill Lorenz, mid-Atlantic; Jeff Markham, greater Texas; Sabina McCarthy, New York metro area; Don Plaus, South Atlantic; Jeff Ransdell, Southeast; Jodi Rolland, Heartland; and Chandler Root, Southwest.
Eleven regional managers are “certainly a lot of direct reports,” said Brad Hintz, a broker analyst at Sanford C. Bernstein & Co. LLC.
“I wonder what Peter Drucker would say?” he said, referring to the management consultant who urged managers to meet frequently with those who report to them.
“The reorganization provides greater empowerment locally,” Merrill Lynch spokeswoman Selena Morris wrote in an e-mail, adding that the regional leaders are all industry veterans and have an average of 20 years of experience.
Merrill's former divisional managers typically made “big real estate decisions, big compliance decisions, like a settlement, and big recruiting decisions,” said Danny Sarch, founder of Leitner Sarch Consultants Ltd., a recruiter.
“These are big-money decisions,” he said. “So you either empower lower people to make [decisions], which is not Bank of America's style, or you put more on [Mr. Thiel's] desk.”
Email Dan Jamieson at [email protected] or Darla Mercado at [email protected]
