The Financial Times wrote this week about a powerful new trend – locating jobs where they can be done most efficiently. Cost pressures are not new; nor are multiple locations. The new trend is that the distinctions between onshore and offshore are breaking down. The FT uses both Jacksonville (technically “near-shore”) and Warsaw (technically “offshore”) as examples of the same phenomenon – creating jobs in lower cost locations.
Global capital markets can only be strengthened by being efficient. In an industry which embodies efficient allocation of capital, there is no room for inefficient producers.
Once a bank becomes open-minded about creating roles in lower cost locations, what are the keys to success? The first is good recruitment and the second is good training.
Recruitment in the City and on Wall Street could do with a shake-up. Best practice is used for graduate entry, and is reasonably successful. Processes of hiring thereafter are informal, and don’t always pick the best talent. So, in Warsaw or Jacksonville or in Canary Wharf, you need to make sure that your recruitment is cutting edge. If you’d like to discuss how Frontline Analysts has adapted and evolved City best practice in lower cost locations, drop us a line.
Once a bank has a talented pool of people, how does it train them when there is not a deep pool of expertise in the room? Capital markets have traditionally used apprenticeship to develop talent – guided learning by doing. The research is clear that this is the only way to develop (technical terms alert…) tacit and judgmental skills. Or common sense as we like to say, somewhat oxymoronically.
The bank venturing to lower cost locations has to:
- connect its young talent with masters in their art
- teach those masters how to coach young talent (as opposed to sitting around and picking it up by osmosis, the good old way)
- teach the wider organisation how to manage and leverage the talent in lower cost locations
None of this is optional. None of this is easy. We know because we’ve been refining our techniques in these three areas since 2005.
Want to know what answers we’ve come up with? Want some expert support in expanding in lower cost locations? Do get in touch.