High Performance Technologists
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The document discusses the challenges banks face in attracting and retaining top technology talent compared to mainstream tech firms like Google and Amazon. It highlights the importance of understanding high performance technologists (HPTs) and their motivations to maintain engagement, as well as the need for a meaningful career path that doesn't solely rely on managerial advancement. The research aims to identify key behaviors and differentiate HPTs to create a pipeline of talent that can drive innovation and enhance the banks' competitive edge.
High Performance Technologists
- 1. High Performance Technologists www.catalyst.co.uk Original Findings May 2013 Where do we start? LinkedIn’s 2012 analysis of the most in-demand employers shows Google, Apple, Microsoft and Facebook occupying the top four places. The most popular bank was Goldman Sachs. It came in at number 90. Initial findings from new research shows banks face major challenges attracting, retaining and motivating the very best technologists in the face of this competition from mainstream technology companies. Solving these challenges is important because the top 1% or 2% of the technology population can add significant value to a bank’s bottom line. Good programmers can be as valuable as good traders if they can develop the code that will give a bank an advantage the Front Office did not even see. A bank that does not have a critical mass of technologists recognised as world-class experts in their field will struggle to compete with those that do. The High Performance Technologist Opinions differ on what defines a High Performance Technologist (HPT). According to one MD interviewed, “a good technologist does the work of five average technologists. But a High Performance Technologist does the thinking of five good technologists.” Catalyst has recently initiated a large-scale study into the make-up of a High Performance Technologist, drawing out the differences
- 2. © Catalyst Development Ltd 2 between good and great on a range of behaviours. This will allow banks to identify the rising technology stars and start to develop these behaviours from an early stage. The study also involves collecting data on what differentiates the very best technologists from their less able colleagues in terms of their motivations and career aspirations. This will allow banks to distinguish those who are best kept working with the technology from those who are suited to leadership roles, and to keep them motivated and performing to their full potential. By knowing who to target and the key behaviours to develop, a bank can create a pipeline that ensures it has a sufficient number of top technologists in the right roles to help deliver on its strategic agenda and have an impact on the bottom line. The early findings from the research highlight a number of common challenges faced by banks as they compete for the best technology talent. Competing with Tech firms Up until the financial crisis, investment banking had its own ‘cool’ and was more than capable of competing with technology firms. But in the last year salaries for new recruits have had to rise by 5% to offset what PricewaterhouseCoopers call “reputational issues”. A recent YouGov survey placed banks at the top of a list of brands that angered the public. According to Howard Flint, MD of recruitment firm Omni Resource Management Solutions, “with such a negative attitude towards banking and bankers, the sector’s ability to attract graduate talent could diminish rapidly.1” 1 Even though technologists occupy roles far removed from the casino-style operations blighting the reputation of banks, the research confirms this is affecting their ability to attract the very best technologists. One of the MDs we interviewed in the US referred to ‘the negative aura of banking’ as one of the biggest strategic 1 1 Negative opinions among graduates could leave the banking sector short-changed of talent. HR Magazine, 10 Sept 2012 challenges facing Technology within investment banks. When asked what was the main downside to working in a bank, one HPT interviewed replied ‘the pariah of banking’. It is not just the negative aura surrounding banking. Many of the senior people interviewed said they now find it difficult to compete with technology firms when it comes to attracting new talent. A CIO from a UK bank said “banks no longer pick up the best, and lose out to Amazon etc. Whichever is cooler. We need to know how we become more relevant to the best technologists.” The answer, according to the research, does not involve paying them more. Top technologists regularly cited the opportunity of working with other very smart people to solve complex technical problems as key to attracting them to the banking sector. Keeping technologists motivated and engaged Banks also struggle when it comes to motivating their current pool of top technologists. The emphasis on regulatory requirements, reducing costs and managing risk means less scope for the creative ground-breaking work that attracted HPTs to work in the banking sector in the first place. When asked what their employer needed to do to motivate them to perform to their full potential, HPTs cited things like greater control and autonomy, the freedom to work on interesting ideas, and having interesting and challenging work. Banks, meanwhile, have imposed more and more controls over what their people do. “It used to be like the wild west here, but now it’s overly bureaucratic” said one technologist, somewhat ruefully. “Put me in a position where I am challenged daily. Don’t leave me stuck doing the same thing. Give me career choices”. “Complex maths, high profile work, and lots of talent,” was how another described the main attractions of working in a bank. The reality is more mundane, and many said they now felt their job was more akin to being a generalist manager or an accountant constantly
- 3. © Catalyst Development Ltd 3 checking the figures to see where costs can be cut. “Infrastructure has become commoditised. We don’t have the ability to change the technology environment given all the regulations”, was how one person interviewed described it. “I need to believe the bank does not see Technology as an inconvenience. So many managers here are just accountants”, was how another put it. Efficiency gains and process improvements have replaced technical achievements as the standard by which HPTs now feel they are judged. The consequence is some feel bored and restless. This is not the reason they joined a bank, and being a manager/accountant is not on their career path. The challenge banks face is keeping the very best technologists interested and engaged when the employee value proposition has changed so significantly. The risk, of course, is that they will take their talents elsewhere, outside the financial sector. Providing a meaningful career path Banks also struggle to find a meaningful career path for those who do not want to become managers. One person interviewed said “I want to feel valued and that I am making a difference.” But many said there is little way for banks to show this other than increasing their number of direct reports, and this is not what these people want. Those interviewed who now occupy CIO or CTO roles spoke of the challenge of retaining these people and showing they are valued while being unable to offer them real advancement up the organisational hierarchy. Genuine technology leadership roles, such as enterprise architect, are few and far between. Some banks have talent development programmes targeted at developing engineering skills, in addition to programmes developing managerial skills. These programmes are a good way of demonstrating the value placed by the bank on these skills. But without a clear route from this type of programme to a senior technology role or a title such as ‘distinguished engineer’, their value can be limited. Banks need to work out a way to use these development programmes to feed a pipeline that will ensure they have a significant number of industry-leading technologists driving their organisation forward. Research trends Catalyst’s research has highlighted a number of other trends that will drive future investigation. For example, there appears to be significant differences in style and approach within the category labelled here as ‘High Performance Technologist’. These differences manifest themselves in how these people approach technical problems and the kinds of solutions they develop, and they have important implications for the way they are best managed. Some have developed a commercial and enterprise ‘mindset’, while others identify strongly with a more ‘purist’ approach to technology. The research is also investigating the extent to which there is a common set of high performance behaviours among technologists. If a common core can be found it will be possible to assess and identify potential HPTs before their talent has fully shown itself. This will allow banks to nurture the development of these behaviours at all levels of seniority, ensuring they are widely practised and creating a pipeline that will provide adequate numbers of the very best technologists. The challenges that lie ahead Early findings from the research also point to other challenges that are broader in scope than those highlighted here: the loss of basic programming skills as more work is off-shored to low cost centres; the dearth of women among the best technologists; new business models that require different skills and approaches from technologists. Enhancing understanding of these things will make significant inroads into the challenges outlined here and allow banks to use these people to make a real difference to their bottom line.
- 4. © Catalyst Development Ltd 4 Meet our author philipullah@catalyst.co.uk Dr Philip Ullah Philip is a Partner at Catalyst, specialising in designing and delivering Catalyst’s leadership development offerings. This includes leadership training, executive coaching, and senior management team development. He is an Organisational Psychologist, having worked as a consultant for 22 years. Prior to that he was a Senior Lecturer in Psychology at the University of Western Australia. Philip is the Author of Collaborative Leadership in Financial Services (Gower, 2011), and three other books. His research into psychology and work has been published widely in leading industry and scientific journals over a period spanning 25 years. He has spoken at academic and business conferences in the UK, Australia, Indonesia, Ireland, and Singapore and is regularly invited to speak at internal events within a number of leading banks. Over a 20 year period he has consulted to some of the world’s largest global banks and hedge funds, including JPMorganChase, Bank of America, Deutsche Bank, The Royal Bank of Scotland, ING, and Man Investments. He is an acknowledged authority on topics as diverse as leadership, collaboration, human factors and risk, business process re-engineering, the psychology of high performance, and psychological responses to change and uncertainty. Catalyst uniquely combines teams of financial markets experts with organisational change specialists to deliver enduring results. We provide honest guidance to help you succeed. We are catalysts for enduring excellence. Catalyst Development Ltd, 167 Fleet Street, London, EC4A 2EA T +44 (0) 870 901 4155 F +44 (0) 871 433 8876 www.catalyst.co.uk