John Whitehead suggested a revolutionary concept: separating roles within investment banking between those who sold banking services and those who provided those services. Most of all, the same investment banker who sold the service provided the service. No banker would solicit business - and especially not from a competitor’s client. Traditionally investment banking at every firm followed a number of unwritten rules. What he then proposed not only changed fundamentally the new business approach at Goldman Sachs but the firm’s organizational structure itself. In response, John Whitehead spoke with partners, business staff and even competitors about their new business organizations. I think it is the most important one in the office today.”
#MEANING BANK MEMORANDA FULL#
Noting the firm’s challenges in securing new business beyond Sidney Weinberg’s own extraordinary network, he instructed Whitehead to “make a full and exhaustive study of our set-up for the solicitation of new business.
The 26-page document was created in response to Sidney Weinberg’s letter sent two months earlier, on the heels of the landmark Ford Motor Company IPO. Weinberg a memorandum that would revolutionize investment banking, not only at Goldman Sachs but throughout Wall Street. In one of the firm's most important industry innovations, John Whitehead submits a memo to Sidney Weinberg in 1956 outlining the establishment of Wall Street's first marketing arm for investment banking, later known as Investment Banking Services (IBS).
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