Firms embracing the latest communication, collaboration and workflow platforms have a significant advantage. Coronavirus has caused a dramatic shift in working practices globally, with particular challenges for front office workers in capital markets. Financial
institutions have moved operations in differing ways but there has been a clear progression from staff split between office and disaster recovery sites, through to the entire workforce working from home.
Initially, due to both the nature of how a sales and trading desk runs as well as regulations around recorded phone calls and record keeping, front office workers were still going into the office. However, as lockdowns tightened and following the Financial
Industry Regulatory Authority (FINRA) temporarily waiving some of its supervisory rules the majority of sales and trading staff are now working from home with a reluctant few still having to travel in to man a skeleton staff dealing desk.
Fortunately, the post credit crisis increase in financial regulation and focus on operational risk has led to improved contingency planning, and regular comprehensive testing of offsite technology, with many firms enforcing days or weeks working from home
before the tightened lockdown to ensure a seamless transition.
In conjunction with improved planning there has also been a change in the way businesses operate over the last decade – expensive city locations have led to a desire to downsize available space for workers. Many firms do not provide enough desks to cover
all staff and hence increased home working has become prevalent in many teams. The cost of any perceived reduction in productivity was seen to be easily offset by savings on desk space and the benefits to employees of a more flexible working environment; from
easier childcare logistics to lack of a commute. Whilst these employees in capital markets were more likely to be away from the front line of trading it has been a valuable learning exercise in how to improve the home working experience.
#WFH – A new paradigm
Working at home for the most part involves remotely connecting to a work computer via VPN – this places less stress on home PCs and internet access. Although reliable
broadband can still be an issue, especially when combined with multiple other users such as family members, who are all isolating in the same location. As home setups are unlikely to have the 6-8 monitors that a dealing desk has, contingency planning in
the weeks before lockdown went as far as arranging work screen layouts to fit into those available at home. Unfortunately, those that were looking for additional home screens have struggled with both rocketing demand and global
shortages in PC equipment making new screens, webcams and hardware hard to come by.
As governments further tightened restrictions and lockdowns, operationally these moves have appeared to have been a success – core tasks have been achievable, levels of service have remained superficially similar, but activity levels have fallen.
The challenge of remote working now moves away from the physical logistics to how to operate in this new environment. The proliferation of systems, screen real estate, applications and communication methods need to be simplified. The new working environment
needs to adjust working practices towards less screens and less verbal communication while allowing for more non-work interruptions (particularly if young children are at home) as well as a new interpersonal dynamic.
Technology steps up
During the first phases of lockdown, cloud providers have seen a meteoric rise in usage with many additional datacentres being brought on-line, with even the likes of Microsoft suffering outages in Azure (its
cloud platform) and Teams (its chat platform) due to surging demand in mid-March.
Meanwhile chat platforms are seeing record numbers of usage with Symphony seeing 40% increase in daily users in Q1 and Microsoft
Teams usage has more than doubled to 44 million users, while video conferencing applications like Zoom are now a household name.
Recreating a sales and trading desk to work from home
One of the biggest complaints so far from sales and trading has been around screen real estate. This is a problem at the best of times (with 4-8 screens in the office) but now this issue is significantly amplified due to home set ups only having 1-3 screens.
However that hasn’t stopped some traders sharing their home trading setups, which now even has its own hashtag on Instagram – #ronarigs.
The prolific rise in chat usage has gone some way to replace the rapid fire communication on a dealing desk – a combination of shouting, absorbing chatter through
osmosis and hoot-n-holler speaker systems – which have all but disappeared. These dealing room conversations, and camaraderie among peers, form a valuable part of market colour, which now needs to be recreated digitally.
Sales and traders from both buy-side and sell-side have said that there has been a significant increase in chat and calls, making it harder to stay on top of everything. The increase in communication results in a slower speed of trade. What is needed is
a better, smarter and faster way to aggregate and consolidate communication, data, notifications and workflow, with less back and forth communication.
Therefore, there is ample demand for digital initiatives, such as:
- Simplified workflows with manual interventions becoming the exception rather than the norm – emailed trades sent within spreadsheets or prices copied and pasted into a chat that are then entered into pricing systems should be replaced with
data driven flows outside of email or fully integrated into chat
- User defined notifications become ever more important, as not all apps may be visible on a desktop particularly with limited screen space
- Axe collation and distribution, commonplace on many sales and trading desks, should integrate with RFQ tools to monitor performance and client interest
- Price or economic data aggregation, to condense 10+ sources into one front end, reducing screen space and enabling more effective filtering and watchlists
- Key risk and performance metrics should be timely, easy to collate across disparate systems and subsequently made available in the best possible way to users
- Elimination of sequential file sharing and increasing the ability to work on the same documents in parallel
- On screen charts that colleagues used to walk over to view, now need to be accessible, more self-explanatory and intuitive
With a thriving capital markets fintech ecosystem, vendors not only interoperate between each other but also provide the tools to streamline workflow more efficiently for sales and traders working at home.
One UK investment bank that has embraced the fintech ecosystem has seen a significant increase in price requests from digital channels, further reinforcing investment to ramp up more digital initiatives. Technology is very much providing an edge in this
Because many business user tools were not built for dynamic and unstructured work and front office dealing desks were not built for home working, there is a huge opportunity for lasting and improved workflow efficiency through the use of technology.