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The Financial Technologist BlockChain 2016 special edition

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Q2 .. 2016

BlockChain’s Breakthrough EXPERT OPINION: IS 2016 THE YEAR B LO C KC HA I N R I S E S F RO M T H E S HA D OWS ? Fingers on the Pulse: Abide Financial, VPD Financial Software Consulting, itarle AG, Quincy Data, Commcise, BSO Network Solutions and Velocimetrics talk to Harrington Starr

AND

Enclothed tell us how to dress casually in the office

Plus

The Breakdown

Latest salary trends in contract, software sales, change, infrastructure and networks.

Talent ID or Character ID? Simon Hartley looks at the keys to great hires.

HELPING THE WORLD’S MOST EXCITING COMPANIES IN FINANCIAL TECHNOLOGY GROW WORLD CLASS SALES TEAMS

The Financial Technologist | Q2

Contents 04

Introduction by Toby Babb

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FEATURE

GROWING BRANDS

GROWING NETWORKS

Working exclusively with the sector’s most dynamic sales talent

Leveraging your brand through our publications and publicity

Connecting and creating business opportunities through events, introductions and connections

BlockChain Special

What is Blockchain and how will it affect your business and the market?

Fintech Focus

Starr Insights

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30 34

Market news & commentary

64

63

Insight on the market from dedicated experts in their field 40

FEATURE Five steps to motivating and retaining great salespeople

Andrew Watson explains Warren Buffett’s principles on motivating and retaining great sales people

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66 68 70 72

How to dress casually in the office FEATURE

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Enclothed tackle the anxiety of what to wear on Dress Down Day at work 50

FEATURE

Over 600 of the leading software vendors, consultancies, fintech startups, banks, hedge funds, brokerages and exchanges trust Harrington Starr to grow their business. Join the community www.harringtonstarr.com

FEATURE

Talent ID or character ID?

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By Simon Hartley,Founder of Be World Class 56

FEATURE

What makes a good application support analyst? By Luigi Negri Best place to work for a developer, By Jon Kay Top five skills in it change & professional services within finance, by Felix Symonds

The breakdown

The 2016 sales market 2016 contract rates: London fintech market Infrastructure and networking salary trends 2016 Change and professional services 2016 salary survey

Harrington Starr sales Conference 2016 FEATURE

An elite group of Senior Sales professionals discuss the most pressing topics affecting the sales market today

Selling the dream

Kona Coaching instruct you how to increase resilience in your workplace 54

The definitive interview guide FEATURE

Parts one and two of the most in-depth and all-encompassing interview advice you will ever need

Michael Ourabah, CEO, BSO Network Solutions Steve Colwill, CEO, Velocimetrics

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GROWING TEAMS

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The Fintec Influencers

The whitepaper from our spring time FinTech Influencers event looking at how much longer the FinTech boom has to last

Harrington Starr US is here! FEATURE

Harrington Starr’s newest outpost. We meet the team taking on new frontiers! 80 81 83

Meet the Editorial Team About Harrington Starr Contact

GLOBAL LEADERS IN FINANCIAL SERVICES AND COMMODITIES TECHNOLOGY RECRUITMENT 0 3

e are delighted to showcase some hugely exciting brands and thought leaders in this first edition as well as sharing our thoughts and insight on the FinTech market in 2016.

TOBY BABB, MANAGING DIRECTOR, H A R R I N GT O N STA R R

Welcome to The Financial Technologist Harrington Starr’s publication merging our previous magazines The Trading Technologist and The FinTech Capital.

W elcome to the Q2 edition of The Financial Technologist. With the start of the year having been dominated by market uncertainty, the second quarter looks set to be cautious. Brexit, China, the news of Nomura pulling out of the equities markets and high profile job cuts in some of the sector’s most established firms have led to some levels of paralysis in the market. Circling continues as the build up to June’s European decision brings speculation as to how the country will benefit or be hurt by staying in or opting out. Earlier in the year, the turmoil from China impacted the City but again, perhaps with lessons

of recent years having been learned, the bounce back to stability was rapid and impressive after initial panic. The natural impact of this conjecture has been an air of caution in the City. The explosion in jobs of 2015 has, thus far, slowed slightly in 2016, though levels remain high in numerous markets. It will be interesting to see how London, as the FinTech Capital, copes following the in/out vote of June 23rd and how quickly the market returns to confidence. With President Obama joining the chorus for the in vote and a deafening noise around the potential harm of leaving to export trade, a key part of FinTech growth, it is my feeling that the sector will grow rapidly in the second half of the year should the in vote win through. Confidence has long been part of the economic success of the country and the media plays a huge part in this. With headlines building an environment of fear and uncertainty, positive press is in high demand. The London Mayoral election, Brexit, UK retail institutions such as BHS (at time of writing) in deep strife have all contributed to a stream of headlines that have done little to build faith in the economy. The natural reaction has been to stop and wait. For some, this has created a genuine opportunity.

A Year of Stunning FinTech Growth in 2015

The FinTech space has had a strong feel good factor in recent years and 2015 was seen as the year where the movement became mainstream. We saw near double investment in the space from 2014 to 2015 with a 92% year on year rise. The five most active FinTech investors (Sequoia Capital,

As with 2008 – 2011, the darkest economic times of recent history, this year has opened the door to companies established to take advantage of the market and show genuine value to their clients. It was interesting to hear Paul Malloy, European Head of Fixed Income at Vanguard Asset Management, speaking at this year’s TradeTech in Paris. Speaking of the startups that he felt would succeed in the months ahead he claimed that the ones who asked the question “how do I commercialise my idea?” will win. This has long been a question that suffocates so many tech startups who have great technology but fail to solve a real problem. He said the ones that got his time were the “ones that show they really understand your problem rather than just sell their product. The ones that boil the product down to its essence and keep the jargon and technology to a limit, then explain how it will continue to evolve and work in 5-10 years.”

"In my mind, the biggest differentiator between companies who have thrived and those who have failed in the post 2008 years has been in the answer to the question “what is the problem you are solving?”"

In my mind, the biggest differentiator between companies who have thrived and those who have failed in the post 2008 years has been in the answer to the question “what is the problem you are solving?” With cost and integration the two biggest pain points of these times, those who find the perfect answer, and importantly pitch, to the above question will be those who can boom whilst others pause. Despite a more cautious market, Q1 has seen astonishing examples of some of our client’s absolutely exploding in both revenue and headcount. Looking at the potential pain points of the remainder of 2016, those who are focussed on proving cost reduction, improved user experience and answers to the inevitable onslaught of regulatory issues look set to be in the box seat for growth.

Blockchain

Also set for growth this year are those who are deeply involved in Blockchain’s breakthrough to mainstream capital markets. Rather than just the technology underpinning Bitcoin, more and more senior technologists in the financial sector that we are talking to have been mandated to explore the benefits of Blockchain technology. The distributed ledger’s new approach to data management and sharing seems to offer a solution to many of the inefficiencies affecting the industry. The big carrot on offer is that of a shining new architecture that will allow all capital market participants to work from common datasets in near real time. The new tech paradigm does however face some major obstacles again, with traditional caution and scepticism associated with breakthrough technology in the capital markets. The scalability


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of the technology is as yet unknown. Big question marks need to be answered around regulation and legislation along with its fitness for purpose. Common standards and governance needs to be established and questions arise around the management of anonymity and the need for a robust cash ledger. With one route being the challenger disruptors developing outside the core ecosystems able to happen almost instantaneously, the capital markets may not see an overhaul of the core parts of the system for up to ten years before we see a shift from the existing value chain to Blockchains. Collaboration is at the key to the breakthrough in capital markets with a collective view on the potential of the technology essential. Established players must work with innovators to ensure the strengths of the sector are complemented by developing the standards of the future. The potential savings to the industry are huge. Transparency in pre-trade offers exciting opportunities. Clients on the buy side in particular will accrue real benefit from cost of capital markets dealing and securities servicing. Major operational benefits would appear for users through transparent real-time data and the removal of the need for data enrichment. It is very much a part of the agenda for boards throughout the banks at the moment and some clear steps need to be taken collaboratively for this to appear. Participants and challengers need to unite in learn by doing programme. The business mind needs to help the tech startups to understand the issues and help them navigate the procurement landscape. They must challenge the service providers to innovate and help to work on case studies giving clear proof of concept. Most importantly, there needs to be a clear plan and pitch prepared for the regulators and supervisory pockets. All of this is unlikely to happen in isolation. The raft of Blockchain conferences in 2016 show that the appetite is there for this collaboration to help speed up the breakthrough. Will it be mainstream by 2017 or are we looking at a decade of toes being dipped in the water? Without question, the incentives for working at pace to create the breakthrough couldn’t be better timed.

FinTech Partnerships

On the subject of collaboration, it was interesting to see partnerships a key theme of TradeTech’s brilliant FinTech panel hosted by Julia Streets. A panel of the aforementioned Paul Malloy, Alfred Eskandar of Portware and Sam Chadwick, Director of Strategy & Innovation at Thomson Reuters

We have heard more and more in recent years on how startups are increasingly frustrated by the procurement processes of big institutions. As Julia Streets highlighted “it can be incredibly hard for FinTech startups to sell their ideas." debated the future of FinTech. It was interesting to hear how Thomson Reuters have been involved in helping over 70 startups use them as a platform. We have heard more and more in recent years on how startups are increasingly frustrated by the procurement processes of big institutions. As Julia Streets highlighted “it can be incredibly hard for FinTech startups to sell their ideas. It can take two years to breakthrough and procurement can then need three years accounts, understandably difficult for a startup!” She continued that passionate entrepreneurs are being told what they want to hear and then the door closes in the procurement process. The route around this is partnerships where institutions are working with FinTech companies to circumnavigate the issue. The security of issues of a large firm working with a startup is circumnavigated by partnering with companies such as Thomson Reuters and it was impressive to see their innovation in helping solve this industry pain point. Their partnerships with companies has included peer to peer (where Chadwick saw real potential), Robo Advisory, Currency Transfer and those who “focus on user experience and cost reduction.” The panel were unified in their thoughts that these areas offered some of the most exciting opportunities for growth along with crypto currency. Interestingly, they looked at who was likely to succeed and the factors that would contribute to that success. Whilst funding, product, the founder’s track record and management teams were all important, the number one factor was market timing. “Is this the right time for it?” was seen as by far the most critical factor in assessing the potential success of an investment. Another reason

why this may just prove to be the breakthrough year for Blockchain.

Trader Exodus to FinTech

I was recently asked to comment by Financial News on the recent cuts at Nomura. The article, which can be read at http://www.efinancialnews. com/story/2016-04-15/nomuras-equitiescast-offs-well-placed-for-hedge-funds-switch, focussed on what those impacted by the announcements could do. It was interestingly timed as we have recently noted a heavy flow of CVs coming from Traders and Brokers looking to switch their career into FinTech sales. It has been by far the most common CV to come in to our sales desk since the turn of the year and complications occur. Whilst many of the skills are transferrable, the lack of product sales experience is not making these resumes top the pile of shortlists for the positions. Those in tech roles are, however, extremely attractive, particularly to the buy side where we have seen more and more move from one side to the other. Additionally, the landscape has changed significantly in technology with a far more diverse landscape for technologists. The FinTech revolution has meant that the bastion of the big ticket investment bank is no longer necessarily the most lucrative or technologically interesting of these positions. For technologists, the cull may have been a blessing in disguise.

In summary

To conclude, the months ahead will either prove a challenge or an opportunity. Those who position themselves to take advantage of the market timing can prosper as we have seen time and time again in the last decade. We’ll see a continued buzz around new and emerging technologies and expect to see Blockchain continue to dominate debate if not P&Ls for the months ahead. Confidence should return by the mid to end of the year as decisions are made around the Brexit. Whichever way the voting swings, the uncertainty in the market will be lowered if not removed. As a nation, confidence is critically important to our productivity. Whilst the market postures in the months ahead of us, those who help increase that assurance and deliver cost effectiveness have a great opportunity ahead of them. I hope that is you. Have a great Q2.

Toby

Thought certainly needs to be invested by traders impacted by the market. Re-invention is key but sacrifice and backwards steps may be needed before big steps forward are taken.

The months ahead will either prove a challenge or an opportunity. Those who position themselves to take advantage of the market timing can prosper as we have seen time and time again in the last decade. GLOBAL LEADERS IN FINANCIAL SERVICES AND COMMODITIES TECHNOLOGY RECRUITMENT

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BLO CKCHAIN T E C H N O LO GY EXPLAINED

By Antonio Ciarleglio

BLOCKCHAIN SPECIAL What is Blockchain? How will it affect my business? In this editions special feature Harrington Starr reveal what is behind the hottest talking point of the last year as well as other news from across the market place.

Harrington Starr

A BlockChain is a database of transactions shared by all participants in a system which is based on the Bitcoin protocol. A complete copy of each BlockChain currency contains all transactions executed in a specific currency. This information will allow you to discover exactly how much value belonged to each and any address at any moment in history. Each individual block contains a hash of the previous block, this creates a chain of blocks from the initiating (first) block to the current block. Every block is guaranteed to immediately follow the previous block in chronological order otherwise the previous block's hash would be unknown. Each block is also almost impossible and impractical to modify, because once it has existed in the chain for a short time period, every block following thereafter would also have to be regenerated. These are the properties which make it very difficult top double spend bitcoins. The BlockChain is the main innovation of Bitcoin. Honest generators can only build onto a block, by referencing it in blocks they create, if it is the most recent block in the longest valid chain. "Length" is calculated as total combinations of difficulty in the specific chain, not the number of blocks, this distinction is important in the context of a very small number of potential attacks. A BlockChain is only valid if all of the blocks and transactions within the BlockChain are valid, and only if it starts with each individual block containing a hash of the previous block, this creates a chain of blocks from the initiating block.

Every block in the chain can only have one path to and from the initiating block. Coming from the initiating block, forks can be created. Block forks are occasionally created when two blocks are created just a few seconds apart, when this happens the generating nodes build onto whichever of the blocks they first receive. The block which is included in the next block will become part of the main chain because this chain becomes longer. Forks which are more serious can and have occurred during bug fixing which required backward-incompatible changes. Blocks which end up in shorter or invalid chains, are not used for anything. When a bitcoin client switches to another chain which proves to be the longer chain, all of the valid transactions of the blocks within the shorter chain are re-added to the pool of queued transactions, these will then be included in another block. The reward for the blocks on the shorter chain will not be present in the longest chain, in effect they will be practically lost. This why a network-enforced 100-block maturation time for generations exists.

E AC H I N D I V I D U A L B L O C K C O N TA I N S A H A S H O F T H E P R E V I O U S B L O C K , T H I S C R E AT E S A C H A I N O F B L O C K S F R O M T H E I N I T I AT I N G (FIRST) BLOCK TO THE CURRENT BLOCK. The blocks on these shorter chains are called "Orphan" blocks. This is because the generation transactions do not have a parent block in the longest chain, therefore these generation transactions show up as ‘’Orphan’’ in the ‘’listtransactions RPC call’’. Several pools can and have misinterpreted these messages and started calling their blocks "Orphans". These ‘’Orphan’’ blocks in reality have a parent block, and may even have children. A block can only reference one previous block, therefore it is impossible for two forked chains to merge. ■


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BLO CKCHAINS AND NETWORKS

By Matthew Lempriere Global Head of Financial Services Market Segment, Telstra

If there is one topic that has accelerated its way up the hype cycle in late 2015/early 2016, that topic is BlockChain. I remember being at a FinTech event a little over a year ago, when it wasn’t even on the agenda. Fast-forward to today and it seems like everyone is now talking about potential use cases for BlockChain technology.

ones such as those underpinning digital currencies like Bitcoin. Perhaps not surprisingly, the banking and finance industry remains somewhat nervous about the latter approach, given that there is no central ownership or oversight of the ledger. Hence the fact that the majority of BlockChain use cases and pilot projects currently under way in the industry revolve around permissioned distributed ledgers, where only trusted parties can participate.

Another element that needs to be considered regarding the BlockChain network, particularly for pilot projects, is that there should be a good degree of flexibility in how that network is deployed. Software-Defined Networking (SDN) can really help here in that it enables secure network nodes to be spun up and down on an ad-hoc basis, as pilot participants are onboarded and as the project evolves from a pilot into a full-blown solution.

Some recent example of such “gated community” BlockChain projects include: Nasdaq’s Linq, a solution for digitally managing share ownership; JP Morgan Chase’s initiative with Digital Asset to address liquidity mismatches in loan funds; ASX’s undertaking to streamline its cash equities posttrade clearing and settlement processes; DTCC’s project (again with Digital Asset) to improve Repo clearing; and various other initiatives. The list grows every day.

In conclusion, during these early days of BlockChain adoption, while use cases are still being developed and tested, it is essential that those who are rolling out BlockChain pilot projects do not underestimate how adopting the right approach to the network infrastructure, and working with the right network partner, could help them achieve their goals. ■

Of course, any kind of distributed ledger needs a distributed network to connect all the participants together. And central to all of the initiatives outlined above – and to any other project where an institution or consortium needs to control access to its private distributed ledger – is the requirement for a highly secure and trusted network, with dedicated, high availability connectivity between each party.

The BlockChain technology has the potential to transform a number of areas across the posttrade landscape, bringing about more efficiency, lower costs and greater transparency across the front, middle and back office, which is why the market is expecting at least $1bn to be invested in BlockChain-related initiatives in 2016.

The importance of network security cannot be underestimated in any kind of gated, permissioned approach to a distributed ledger, which is why any bank, institution or consortium investigating the use of BlockChain technology - particularly in a private, permissioned environment - needs to seriously consider how it is going to manage the security aspect of its network. Working with a trusted Global network partner that is able to create highly secure links between all its community participants can greatly reduce risk in this regard.

Much is being made of the fact that Digital Asset Holdings, the BlockChain startup headed by the former JP Morgan banker Blythe Masters, raised $60m in funding earlier this year from 15 financial institutions - including Santander, Citigroup, JP Morgan and Goldman Sachs - as well as IBM. Meanwhile R3 CEV, another well-funded BlockChain startup, is being supported by the likes of Barclays, Credit Suisse, Commonwealth Bank of Australia and UBS. According to various venture capital sources, a number of other BlockChain startups and consortia are now entering the fray.

LEGAL CHALLENGES F OR BLO CKCHAIN BUILDERS

By Raoul Lumb Associate, Hill Hofstetter

Matthew Lempriere is Telstra’s Global Head of Financial Services Market Segment based in Hong Kong, where he is responsible for identifying and leveraging opportunities for the company within the sector across Asia Pacific, EMEA and the US.

BlockChains represent terra incognita for legal professionals and FinTech developers alike. For lawyers the difficulty is that, because the technology is still in its infancy, the law simply hasn’t quite caught up yet. However, that’s not to say that there aren’t any legal potholes that BlockChain builders need to look out for as they start to bring products to market. So, in no particular order, here are three obvious challenges that ought to be on every technologists mind as they look to build and develop BlockChain solutions.

Matthew joined Telstra in August 2013, bringing with him over 20 years of sales and account management experience in the financial and telecommunications industries. He has in-depth specialist knowledge in the delivery of electronic trading and information applications in the banking and finance industry. Prior to joining Telstra, Matthew was Head of BT Radianz for Asia Pacific. He has also held a number of other senior management roles at BT including Sales Manager, Greater China for BT Global Financial Services, Business Development Manager for BT Radianz and Senior Account Manager for BT.

The first is that the kind of indelible, irreversible ledgers that BlockChain creates are both a blessing and a curse, granting one kind of security while taking another away. To break that statement down a bit, because a distributed ledger cannot be unilaterally amended by a single party, it is highly resilient to attempts by External Attackers (‘hackers’ in the popular press) from generating bogus records or unlawfully transferring assets from one account to another. However, there is nothing about BlockChain networks that make them entirely immune to having Internal Attackers perpetrate fraud across them (by masquerading as another party, enticing others to enter into transactions using deception, etc).

I T I S E S S E N T I A L T H AT T H O S E WHO ARE ROLLING OUT B L O C KC H A I N P I L O T P R O J E C T S D O N O T U N D E R E S T I M AT E HOW ADOPTING THE RIGHT A P P R OAC H T O T H E N E T W O R K INFRASTRUCTURE, AND WORKING WITH THE RIGHT N E T W O R K PA R T N E R , C O U L D H E L P T H E M AC H I E V E T H E I R G OA L S .

Regarding how and where the BlockChain technology can be applied in the financial services industry, most of the current interest seems to be around the use of “permissioned” (i.e. private) distributed ledgers as opposed to “permissionless”

Usually a party that finds themselves out of pocket has the option to petition a central ledger keeper to reverse the relevant transaction or to go to court and sue for the return of the asset in question. However, in a BlockChain environment neither of those options is realistic as the asset in question


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BLO CKCHAIN – T H E U LT I M AT E D I S I N T E R M E D I AT I O N OR A FINTECH MIRAGE?

is ‘locked away’ until the party holding it chooses to cooperate and can’t be compelled to return it; therefore the only remedy that the injured party has is to sue for money, which isn’t much use if the party facing the claim is insolvent or has, to use a technical term, done a runner (as fraudsters are remarkably prone to do…).

FOR TECHNOLOGISTS THEN, THE SMART MOVE IS TO SEE THESE PROBLEMS COMING AND TO THINK A B O U T H O W T H E Y C A N ‘ F I X ’ T H E M I N A D VA N C E . HOW CAN USERS BE GUARANTEED EFFECTIVE REMEDIES WHEN THINGS GO WRONG? The second is that consumer-facing BlockChains are likely to be on a collision course with European data protection law. The reason for that is because the Data Protection Act (and its soon to be European successor, the General Data Protection Regulation) hates the idea of personal data being permanently stored and widely disseminated. European citizens have a right to have their personal data processed for no longer than strictly necessary, and to have it protected from being processed by unauthorised third parties. However, those rights sit uneasily alongside a technology that relies on sharing full copies of a transaction ledgers across a wide network of members. Finally, it’s worth noting that there’s still some doubt about whether intangible units of exchange on BlockChain based systems (such as Bitcoins and Ether) are capable of qualifying as ‘property’ in UK law. We are currently without an act of Parliament that declares them to be property, and given that it’s quite difficult to slot ‘cryptointangibles’ into any of the existing categories of intellectual property, it’s hard to see how they can be classified as assets capable of ownership at the present time. Further, precisely how they will end up being classified (will they be physical property or currency, for example) will have significant ramifications for how they are regulated and taxed in the future. For technologists then, the smart move is to see these problems coming and to think about how they can ‘fix’ them in advance. How can users be guaranteed effective remedies when things go wrong, and how they might partially anonymised ledgers be implemented that protect customer identities without compromising the integrity and security of the underlying system (such as by rendering them entirely pseudonymous, untraceable and open to asset laundering in the same way as the Bitcoin network).

In conclusion, it’s worth noting that the above list is distinctly non-exhaustive and that specific BlockChain applications will come with their own ramifications. As such, if you’re in the business of developing BlockChain solutions, consider taking your local technology lawyer out for a coffee as part of the design process. ■ Hill Hofstetter is a UK business law firm specialising in technology, financial and industrial markets. Its highly rated Technology team advises a wide range of European and US companies on Intellectual Property, Privacy and Regulatory matters, and helps them to draft and negotiate contracts with their customers and suppliers.

By Sophie Halberstam Associate Agitator, Cruxy

The advent of BlockChain has polarised the technoscenti more than any other technology since the internet itself came to prominence over 20 years ago. If adopted widely, it could sound the death knell for financial and other intermediaries and revolutionise not just finance but all provenance-based transactions. It could be deployed to certify and distribute everything from art to diamonds and music to bananas. However, tech and hype are common bedfellows. One need only consider the precipitous descent of recent “unicorn” Powa Technologies to see where the dangers lie. At best, BlockChain is seen as a democratising technology which enables users to trade on a P2P basis, circumventing exploitative middlemen, notably credit card providers and banks. At worst it is seen as synonymous with the “Silk Road” which provides an anonymous interface to the dark web, enabling traceless payments to be made for drugs, arms and other socially repugnant lines of trade. This diametrically opposed stand-off is, to some extent, based on an erroneous conflation of BlockChain with Bitcoin. Bitcoin is the most famous crypto-currency and Bitcoin transfers, for both legal and illegal transactions, are processed via the BlockChain. BlockChain is a decentralised ledger system which supports not only cryptocurrency transfers but also a wide and ever-expanding range of digital commerce transactions and transfers. For example, BlockChain can also be used for transfers of digital assets (such as copyright licences), transfers of securities,

invoicing, and issuance and administration of insurance policies. The potential list of applications is almost infinite. Furthermore, whilst Bitcoin was the first and somewhat flawed model, there is now an ever expanding list of cryptocurrencies and associated platforms ranging from the highly acclaimed Ethereum and associated Ether currency (the value of which has increased 1000% in recent months) to lesser known examples such as “Potcoin” which services the legalised cannabis industry. Detractors see the distributed, disintermediated nature of the technology and concomitant lack of central control as a bar to growth as governments will suppress what they cannot control and what they find difficult to tax. Focal to the concerns of the establishment are that key tools of monetary control, notably quantitative easing, would be completely undermined if there were one or more viable alternative currencies, the supply and control of which were outside the sphere of influence of government. US economist, Paul Krugman, has written that “Bitcoin is evil” and he is not alone. One can understand that vested interests, notably in the financial services industries, are trying to protect their domains against the BlockChain barbarians. It is clear, however, that central banks and governments think that BlockChain poses a material, existential threat, which is best addressed through a combination of embrace and competition. This is evident from the recent reports of the advent of a proto-currency known as RSCoin, jointly developed by computer and the Bank of England. It works on the BlockChain platform but, rather than promote a libertarian agenda, it would be used as a tool of state control, allowing the central bank to keep a tight grip on the money supply. Maybe the clearest guide to the future comes from the clever money. For those who think that the technology is a fad or craze, it should be borne in mind that American VCs invested over $1 billion in bitcoinbased ventures in 2015. This exceeds the sum they invested in internet ventures in 1994 and it looks like they got it right with the internet. If there continues to be a standoff between the believers and the cynics we may never progress. The success of businesses built on BlockChain relies on widespread validation and consensus. Conferences, meetups, seminars, and endless noise will not underpin the necessary paradigm shift. Unless the financial services community overcomes its fear of disintermediation and redundancy and embraces the BlockChain through investment and adoption, the promise and potential will simply rust and crumble." ■


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More firms required to report more transactions in more detail

New reporting regulation captures more investment firms within their remit. With few exceptions, MiFID II and MiFIR reporting obligations apply to all investment firms including investment managers, credit institutions, market operators (trading venues), EMIR counterparties, some non-financial counterparties (under EMIR), central counterparties and third country firms offering investment services within the EU.

RISING TO THE R E G U L AT O RY REPORTING CHALLENGE

By Chris Dingley

MiFID reporting obligations extend beyond EU/ EEA borders to any derivative traded outside the EU if the underlying instrument is traded on an EU trading venue, to any offshore firm giving execution instructions to an EU broker and to firms executing ‘offshore’ for dual listed instruments for an EUbased decision maker.

Head of Sales, Abide Financial

The range and reach of new reporting obligations – MiFID II/MiFIR, the EMIR rewrite, SFTR and others - are a major headache for operations and compliance teams when precious internal resources – people and capital – are focused on a host of prescriptive market conduct rules affecting client servicing and fair and transparent trade execution that go beyond MiFID, like Market Abuse Regulation.

Not only do more parties have to report, they have to report more information about more transactions. In fact, pretty much every tradeable instrument and derivative of an instrument admitted to trading on an EU trading venue (or where the underlying is traded on a trading venue) falls within new regulatory reporting rules. Further, firms must provide details of any trade execution that changes a firm’s or its clients’ positions in a given product; MiFIR, MiFID II’s companion regulation, imposes additional and specific reporting obligations relating to equity execution quality and commodities positions.

Transaction reporting compliance requires eligible firms to be able to identify all transactions subject to new rules and to deploy an efficient process workflow to satisfy obligations to report to local regulators “as soon as possible”.

Retail derivatives firms are impacted particularly and significantly by these new rules and will no doubt be consulting lawyers on the question of whether they must become an OTF (Organised Trading Facility) or SI (Systematic Internaliser). If either of these states applies, those firms will then become subject to most of the reporting rules applying to major regulated markets, as well as pre and post-trade transparency requirements, SIs will also need to ensure continuous, public, two-way pricing at all times, likely facilitated by an APA (Authorised Publication Arrangement).

Regardless of uncertainty about implementation deadlines, doing nothing in the hope that this headache will go away is not an option. Regulators have indicated that they will take a very dim view of firms that fail to report in the prescribed manner at ‘go live’, with those that fail to comply facing severe financial penalties and reputational risk.

It is of course hard to scope the scale and impact of change when rules aren’t (yet) set in stone, or the timeframe for satisfying them. Regardless of delays to proposed implementation dates, regulators are clear U N D E R S TA N D I N G A N D M A N AG I N G T H E C O M P L E X I T Y that they expect reporting O F N E W R E P O R T I N G O B L I G AT I O N S P R E S E N T S A N firms to show progress NOW in ENORMOUS CHALLENGE TO ALL REPORTING FIRMS AND preparing and implementing PA R T I C U L A R LY T H O S E E N T I T I E S T H AT F I N D T H E M S E LV E S reporting processes that S U B J E C T F O R T H E F I R S T T I M E T O N E W R E G U L AT O R Y will ensure compliance at R E P O R T I N G O B L I G AT I O N S . go-live.

Consolidation and disclosure of trading data under MiFIR

services to non-EEA clients that have been, to date, somewhat reluctant to provide them (LEIs).

 ARMs (Approved Reporting Mechanisms) remain substantially the same in concept as those authorised by the FCA under MiFID I, although they pick up certain additional obligations and organisational requirements.

 National/Individual person identifiers for investment decisions/trade execution A new requirement for additional identifiers (e.g. National Insurance Number in the UK) to identify individuals (natural persons) within transaction messages is also potentially problematic. As well as having to enhance client on-boarding processes to collect LEIs, investment firms must also take data from internal HR systems that ‘identifies’ individual employees responsible for investment decisions/ trade execution.

In the continuing quest for best execution and market transparency, MiFIR introduces new rules around timely public disclosure of transaction data. Data must be disseminated by one of three authorised Data Reporting Service Provider (DRSP) channels:

 Consolidated Tape Providers (CTPs) are self-explanatory (although to date no organisation has put itself forward to assume this particular mantle).

 Alternative Instrument Identifier (Aii) replaced by original ISIN standard The Alternative Instrument Identifier (Aii), which took four years to implement under MiFiD and was taken up subsequently by EMIR for exchangetraded derivatives, has been discarded in favour of the ‘legacy’ ISIN standard. Instruments that don’t have an ISIN in their own right, or are not listed in the ‘official’ ESMA list when it is published, will require up to 15 additional fields of description and categorisation to be associated with them, including a ‘complete and accurate’ CFI code.

 Authorised Publication Arrangements (APAs) require most explanation and play a much more significant role than current Trade Data Monitors (TDMs), mainly because of the vastly increased number of products which will become tradereportable. Every investment firm and Systematic Internaliser trading a bespoke product on its own books will have to appoint an APA to make trade details available in (quasi) real-time on a reasonable commercial basis (think of it like a regulated stock price ticker), make the information public (through the APA platform), and supply the data to authorised CTPs. (Although the identity of originating firms will not be made public, each trade will be given an individual reference by the APA to facilitate enquiries from firms and their regulators).

While the July 2015 update to ISO 10962 (Standard for CFI Codes) is a comprehensive categorisation of financial instruments, firms may still struggle to find ‘complete and accurate’ codes for new and/or bespoke products, like CFDs based on bond futures, for example, and commodity-based spread bets. Similarly, while the ‘underlying instrument’ field for OTC derivatives must be populated with an ISIN value, not all instruments currently in scope as reportable will have a readily identifiable ISIN (e.g. CFDs on currency pairs listed currently on at least one MTF).

Significantly expanded reference data obligations

A key element of MiFID II is its focus on data quality and the breadth of reference data that firms will be obliged to obtain, maintain and use to report transactions.

As such, reporting firms and trading venues have to resolve the conundrum of reporting on myriad (now) reportable transactions to comply with regulatory reporting timelines without knowing exactly how to report them - and in the absence, potentially, of ‘complete and accurate’ CFI codes and /or underlying ISIN values at the time they must be reported.

 Legal Entity Identifier (LEI) required before providing client services The Legal Entity Identifier (LEI), which caused so much pain when it was introduced under EMIR, is reinforced under MiFIR as the standard for identifying corporate entities. New and explicit MiFIR Regulatory Technical Standards require that investment firms obtain LEIs from clients before providing services which would trigger reporting obligations in respect of transactions effected on behalf of those clients” (RTS 22(13)). This may prove particularly troublesome for firms offering

Given all of these challenges, it is hardly surprising that impending regulatory reporting obligations tax the imagination of even the most experienced operations teams.


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Avoid a transaction reporting migraine – be right first time

Understanding and managing the complexity of new reporting obligations under MiFID II/MiFIR and with the proposed EMIR Rewrite and other evolving regulatory frameworks like SFTR thrown into the mix, presents an enormous challenge to all reporting firms and particularly those entities that find themselves subject for the first time to new regulatory reporting obligations.

C RO S S I N D U ST RY I M PA C T F R O M R E G U L AT I O N S

Eligible firms must determine whether they have sufficient expertise to evaluate evolving reporting requirements effectively themselves and the right resources to expand or adapt internal systems and processes to deploy an effective and compliant solution to multi regime, multi jurisdiction transaction reporting obligations.

By Michael Weitman Senior Consultant/Manager, Finance & IT VPD Financial Software Consulting

Alternatively, firms may choose to partner with an external service provider focused exclusively on understanding and managing the impact of regulatory change on transaction reporting processes, and to manage end to end reporting processes for multiple regulatory regimes and reporting destinations.

Why fund management companies should care about Solvency II (and Insurance companies about data management) It is natural to focus on the regulations that directly impact your company. However, that may lead to that you miss some important side effects that will sooner or later take you by surprise. An area where we see a growing interest is the need to disclose the underlying nature and composition of investment funds.

Clients of Abide Financial benefit from a fully managed process that takes the pain – and effort - out of untangling the complex web of diverse (and changing) reporting requirements and mitigates the risk of reporting failure as new rules come in to effect. ■

Why? The Solvency II directive that affects most insurance companies has like the Basel III directive for banks imposed new stricter and more diversified capital requirement and reporting regimes. Institutional investors such as insurance companies are often a major client base of investment funds, and when they are targeted by stricter capital and reporting requirements (e.g. see article 84 in the EU regulation 2015/35) they will require more detailed and timely information about the funds they have invested in. This will soon be regarded as a musthave institutional client service. Insurance companies which have invested in pooled investment products such as AIFMD funds (private equity, real estate and special funds) and UCITS funds need to classify and categorise these investments and apply risk weights on these assets together with other assets that are held directly. In order to minimise the hair-cut on assets and the

negative effect on capital requirements, more data on the underlying investments need to be collected by insurance companies. Fund companies that are unprepared and unable to disclose and provide information in a timely, concise and effective manner may suffer in the competition for new and existing institutional clients.

HOW FINANCIAL SERVICES PROVIDERS CA N R E A P R E WA R D S O F M I G R AT I N G TO THE CLOUD

A S R E G U L AT O R Y P R E S S U R E S O N T H E I N S U R A N C E C O M PA N I E S G R O W T H E Y W I L L R E Q U I R E M O R E DATA AT A H I G H E R F R E Q U E N C Y , M O R E E F F I C I E N T LY A N D W I T H L O W O P E R AT I O N A L R I S K .

By Adam Eaaton Sales Director, Pulsant

Failing to look-through investment funds and other pooled investments on some level could mean that insurance companies are limited by the capital requirements and even unable to add attractive investments such as private equity funds, and the overall investment opportunity could diminish.

Regulatory Landscape

Even if capital requirement is not a restraint on the investment opportunities for insurance companies with a high solvency ratio, the regulatory reporting requirements have raised concerns both from a compliance perspective and from an operational data maintenance perspective among insurance companies. Failing to validate, categorise, aggregate and report exposures, including the underlying exposures of investment funds, correctly may lead to future sanctions from the supervising authorities.

In a survey carried out by the Cloud Security Alliance, How Cloud is Being Used in the Financial Sector, 61 per cent of respondents admitted that a cloud strategy is only in the formative stages within their organisation, with 39-47 per cent planning to use a mix of in-house IT, private, and public clouds, and 18 per cent planning to use private clouds. None of the respondents have plans to host a majority of their applications or systems in a public cloud. Yet outside of the financial services sector 88% of enterprises utilise public cloud in some way, shape or form. So why are financial services providers lagging behind?

An effective data collection and validation process supported by effective systems with mechanisms to extract, transform and load data efficiently is necessary to control the data management costs and operational risks involved. The large number of data points to collect and maintain for each investment is a daunting task. As regulatory pressures on the insurance companies grow they will require more data at a higher frequency, more efficiently and with low operational risk. ■

Before discussing the rewards available for a financial services organisation in the cloud and why adoption is slow, it is important to get an understanding of the regulatory backdrop. In October 2014 the Financial Conduct Authority (FCA) launched Project Innovate, an initiative to foster innovation in the cloud. The key driver behind this project was to understand in more detail where the regulatory framework needed to be amended in order to foster innovation. It has been broadly recognised by the UK Government and the FCA that in order to foster innovation and remain at the leading edge of the financial services industry innovation needs to be embraced and promoted. Interestingly it is often down to the location and movement of data the cloud encourages that drives some of the regulatory challenges. Indeed, the FCA defined the following three points as significant:

Michael has been with VPD for over 20 years and leads our clients through a host of their regulatory projects from inception to completion, scoping requirements, automating data management, configuring the calculations, and refining the internal and external regulatory reporting. The VPD Data Management solutions include a data warehouse, an automated ETL import process, data reconciliation and data validation. For more information, contact us: [email protected]


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1. Cloud customers may have less scope to tailor the service provided. 2. Cloud customers may also have to accept that cloud service providers will move their data around; however, in some cases, cloud customers may be able to specify which overall geographic region in which their data is stored. 3. Firms should also consider the risks associated with outsource service providers who may contract out part of their operation to other cloud providers. This may occur without the firm initially realising Companies should also be aware of new legislation and how it impacts a move to the cloud, specifically new EU Digital Single Market strategy and reform of EU Data Protection legislation. The exact form of the cloud service adopted, whether PaaS, SaaS, IaaS or another flavour of cloud does not change how an organisation adheres to regulatory requirements and when outsourcing to a third party the organisation must still be aware of their obligations under the relevant regulations. Despite the significance of the three points identified by the FCA the Finntech industry in the UK is already booming and offering some of the larger financial organisations a view of how cloud can deliver genuine rewards.

I T H A S B E E N B R OA D LY RECOGNISED BY THE UK GOVERNMENT AND THE FCA T H AT I N O R D E R T O F O S T E R I N N O VAT I O N A N D R E M A I N AT THE LEADING EDGE OF THE FINANCIAL SERVICES INDUSTRY I N N O VAT I O N N E E D S T O B E E M B R AC E D A N D P R O M O T E D . Gartner predict that public cloud spending in 2016 will grow to $204bn globally and demand for IaaS will rocket, but that has to exclude many financial services firms who are reticent in their uptake of cloud services. What would the total spending be if the financial services industry were to get on board? So with the backdrop of a heavily regulated industry, albeit one that is trying to incorporate cloud, how do new and traditional financial services organisations begin the lengthy process of unlocking benefits in the cloud? Benefits already realised in other less regulated markets such as content and digital media.

I firmly believe the answer lies not in adopting an ‘everything in the cloud’ strategy but in pursuing the goal of Hybrid IT. Hybrid IT is defined as an approach to enterprise computing in which an organization provides and manages some information technology (IT) resources in-house but uses cloud-based services for others. When talking about cloud the first thing that often comes to mind is the public cloud providers and from an enterprise perspective how this pillar is being adopted today. In Q1 2015 AWS reported revenues of £1.57bn, just slightly more than that sum its four nearest competitors Salesforce, Microsoft, IBM and Google. So with a public cloud market of more than $3bn in Q1 alone I would be reasonably confident in suggesting that financial services organisations are no different to other industries where shadow IT and un-regulated use of public cloud services is prevalent. A great example of hybrid cloud adoption is Suncorp Bank Australia who, in 2013, launched a virtual private cloud and virtual data center, and the bank is now in the process of moving more than 2,000 applications and large parts of its core banking system to the AWS Cloud. As part of its “all-in” strategy with AWS, Suncorp also decided to exit a disaster recovery (DR) site designed to support 12,000 virtual desktop users, in addition to other critical applications. To do so, the bank worked with NetApp cloud experts to deploy a private storage solution with a direct connection to AWS.

It is the adoption of a hybrid strategy that will deliver the most significant benefits to financial services organisations, however Gartner point out that a hybrid cloud computing model is still two to five years away from achieving mainstream adoption, with just 15% of enterprises consciously adopting a hybrid approach. In the past I have spent time with organisations who have treated the move to the cloud as a binary decision, I either will or I won’t. The complexities of managing multiple IT environments will not go away, however technologies that allow you to move workloads effectively and efficiently across multiple IT environments is becoming more readily available. Imagine if your Hybrid IT environment consisted of access to a public cloud for cheap, flexible compute. Your revenue generating applications are managed by yourself in a collocated environment as you do not wish to lose control. Regulated applications sit in the cloud with a 3rd party cloud provider to ensure data location and for longer term projects your 3rd party provider offered an enterprise cloud. It is when all these clouds align that you will reap the rewards of migrating to the cloud. ■

USING ALGORITHMS TO REDUCE FX COSTS ON OVERSEAS EQUITIES TRADES

By Dr Paul Lynch CEO & Founder, itarle AG

Many UK and US-based investment managers who trade equities look overseas - particularly towards emerging markets – in their search for alpha. However, as those markets generally settle in their home currency rather than US Dollars, fund managers are often left holding a position in a currency that they don’t actually want when making a trade. What they actually want is a position in the stock, it just happens to be denominated in a different currency. This unwanted currency balance (particularly with the recent increase in emerging markets FX volatility) can lead to additional costs, unwanted risk and inefficient settlement processes involving FX transfers, not to mention awkward question from compliance departments as to why the fund manager is invested in Roubles, for example.

Many of the customers and prospects I talk to today discuss the challenges of managing shadow IT in their organisations but also recognise that public cloud could form a cornerstone of their IT strategy. Indeed, according to a Cisco report in 2015, the number of unauthorized cloud apps being used in the enterprise is 15 to 20 times higher than CIOs predicted. Hybrid IT offers organisations the opportunity to incorporate public cloud into the IT strategy where appropriate. The challenge for financial services organisations is to understand their application portfolio in detail and to overlay regulatory requirements on top of those applications. Other industries can often approach this piece of work from a different angle, ie which applications are cloud ready, financial services organisations need to ensure that regulatory requirements are also met. Once applications have been classified according to cloud readiness and adherence to regulatory requirements it is possible to build a Hybrid IT strategy where certain applications can be migrated to the cloud.

How can this whole process be made cleaner, so that at the end of the trading day, the fund manager holds his account balances in US Dollars and not the foreign currency?

The problem with ADRs

One approach would be to use Depository Receipts or ADRs traded on the home market, so that the position is being traded and settled in US Dollars. This approach does have its drawbacks however. First of all, ADRs might not be available for the stock in question. Secondly, because they mimic what is happening on the primary exchange, ADRs often provide only shadow liquidity with little real depth,


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so trade executions can be costly due to wide spreads and thin trading. There can also be a cost implication from increased margin requirements. And some fund managers have mandates that prevent them from investing in ADRs, which can rule them out completely. So whereas ADRs might make sense in some specific circumstances, in many others they would not.

An algorithmic approach

There is a more elegant approach to solving the problem of unwanted currency balances on overseas trades, which is based around algorithmic trading. The way this works is remarkably simple. All it takes is for the broker to be able to offer a cross-currency execution algorithm. An example of how this works is as follows. A fund manager wants to take out a position in Gazprom and would like to be able to take advantage of the narrow spreads and depth of order book on the stock’s primary exchange, Moscow Exchange (MoEx). However, he does not want to see any Roubles on his books, he wants everything to be executed, cleared and settled in US Dollars. Using the cross-currency execution algorithm, the fund manager sends the parent order to the broker, who routes it to MoEx for execution using the chosen algorithmic method (e.g. VWAP; TWAP; Arrival Price; Participation; etc). At the same time that each child order trades on the exchange, the broker automatically performs a USD/RUB FX trade, so that each and every fill is delivered to the fund manager in US Dollars. Because the fund manager only sees fills coming back in his home currency, it makes the whole process much cleaner from his perspective, as he doesn’t have to worry about holding balances in Roubles or doing any FX trades to convert his position into US Dollars. It’s all done for him in real time.

Clearly, offering a service such as this gives the broker a competitive advantage because very few brokers are currently offering this. Brokers can also enhance their margins by taking a spread on the FX component. The key to all of this is the algorithmic element. It’s a much more simple and streamlined process for the broker to offer FX currency conversion algorithmically in an automated way than it is for them to have resting orders with their FX desk to convert client balances for example. At the time of writing, currency pairs such as USDJPY have been averaging 30 day volatility of 13%, with more volatile currency pairs such as USDRUB averaging 35%. With most Western central banks heading for negative interest rate policies and with emerging economies struggling from depressed raw commodity prices, this FX volatility is sure to continue. By automating the FX conversion in real-time the end user benefits from reduced execution volatility whilst the broker can simultaneously offer FX price improvement and improve overall profitability. Simply put, using algorithms to automatically convert currencies at the point of execution is a win/win situation, for both the client and the broker. ■ Dr Paul Lynch is CEO and Founder of itarle AG, an algorithmic trading service provider for banks and brokers across global exchanges, combining extensive quantitative trading and modelling experience to produce robust private label algorithms with market leading functionality and performance.

L O W E R L AT E N C Y A N D L O W E R C O S T: H AV I N G YO U R C A K E A N D E AT I N G I T T O O

By Stéphane Tyc Co-Founder, Quincy Data and McKay Brothers

For years now we have heard about how banks are under increasing pressure to cut costs. In the post-crisis era, a large proportion of spending has had to be earmarked for upgrading systems to meet regulatory requirements. With the latest annual cost of compliance survey from Thomson Reuters showing that 70% of firms expected regulators to publish more regulatory information concerning requirements (with more than a quarter of firms expecting “significantly” more), it’s little wonder that banks have been putting much of their focus on compliance-related spending rather than performance-related investment. Although this means proportionally less money is going into technology that could enhance performance, such as via lower latency networks, there is an upside to this situation, which is that banks are increasingly open to innovative solutions that both maximize the return on investment and minimize the total cost of ownership. What if someone said you could dramatically reduce your latency and save money at the same time? Suddenly investment decisions could become a lot easier. That possibility is finally becoming real as new networking solutions that combine traditional fibrebased traffic with cutting edge microwave technology come on stream.

And this doesn’t just apply to emerging markets. There are many US clients who like to trade Canadian stocks but settle in US Dollars for example, and vice versa.

Advantages for the Broker and the Client

When it comes to latency, banks have had to strike a delicate balance. They need to be fast – to serve latency sensitive clients and for their own risk management - and they need to be reliable. But banks also have plenty of clients for whom shaving

It is clear that this approach is advantageous to the fund manager for the reasons outlined above, but what’s in it for the broker?

microseconds doesn’t matter so much. So how can they stay competitive in latency terms without spending a fortune on latency reduction investments that some of their customers may not deem essential? Given the spending restraints they’re already under due to regulatory requirements, this question becomes even more difficult to answer. There could be a way. The technology is actually not that new but it was given renewed attention thanks to microwave networks. Microwave bandwidth is so scarce that market data providers have developed very efficient compression algorithms to distribute even a limited subset of the data. Now those investments in better compression and more efficient distribution can be ported to fibre. Today, a host of microwave networks are in place that can be leveraged in a way that can give banks access to much lower-latency networks without sacrificing reliability, security or limiting the ability to move large amounts of data over great distances. The icing on the cake is that once you combine the speed of microwave with the reliability of fibre, firms will actually be able to lower their market data distribution costs. Since service providers such as McKay Brothers are already running ultralow latency networks that can meet the requirements of the most demanding customers, making that technology available to a wider client base is not that great a leap. The hard work already done for these ultralow latency customers means the technology can be extended without the service provider taking on a great deal of extra cost. The obstacle has always been that while latencybased trading firms can design their trading strategies to minimise the amount of data that crosses a network, banking firms don’t always have that option. Often significant amounts of data need to criss-cross the globe. Cloud technology, improving data storage and data mining capabilities and increased regulatory risk management requirements are just some of the factors behind the exponential rise of data traffic. Think of it as a cost of doing business. The solution comes from combining microwave networks with fibre. By combining these technologies, banks can get the most relevant information by microwave and receive a full feed of all the data via fibre. The first microwave networks, developed half a decade ago, linked the futures markets of Chicago with the cash equity markets of New York. Since then, numerous networks have sprung up that


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I T ’ S A B O U T S T R AT E G Y A N D PRIORITIZING THE MOST I M P O R TA N T DATA F O R CLIENT SERVICE AND RISK M A N AG E M E N T . I T ’ S A B O U T COMBINING BEST-IN-CLASS P E R F O R M A N C E W I T H I T S AV I N G S .

RESEARCH PAY M E N T S A CHANGING LANDSCAPE FOR THE BUY SIDE

shave milliseconds off of transit times between a host of major financial centres, including London and Frankfurt. The companies that demand the lowest latency possible were the earliest adapters. Demonstrating the value of these ultra-fast networks within a bank’s infrastructure is a natural extension.

By Amrish Ganatra Managing Director & Co-Founder, Commcise

Marrying the robustness of fibre with the sheer speed of microwave is a work in progress. But it’s happening. Banks are already exploring the benefits that this marriage can offer. For those that do, the marriage is not actually about technology. It’s about strategy and prioritizing the most important data for client service and risk management. It’s about combining best-inclass performance with IT savings.

Any day now, the European Commission (EC) will officially release its longawaited draft of the MiFID II “Delegated Acts”, part of which will refer to the unbundling of commission payments.

In the hard-nosed world of finance, no one puts much stock in fairy tales. But the combination of fibre and microwave may just be one of those happily-everafter marriages you occasionally hear about. Watch this space. ■

Although a leaked draft of this document has been circulating around the market, investment firms are still looking for answers.  What will change under the Delegated Acts?  What exactly is a Research Payment Account (RPA)?  How will firms account for research payments under MiFID II?  What steps should an Investment Manager take now to prepare for the future?

Stéphane Tyc is Co-Founder of McKay Brothers and Quincy Data. Stéphane received a PhD in Physics from Harvard University. He continued his fundamental research at Thales Group. He earned multiple patents on power transistors for microwave radios and superconducting logic devices. Stephane enjoyed a 17-year career at BNP Paribas. He directed Equity Derivative Quantitative R&D, Global Business Management, and Post Trade Services. His responsibilities included low latency arbitrage research, high performance computing, and market risk. He also served on the DTCC Warehouse Trust Company Board of Directors for two years.

This article aims to address these questions.

The Delegated Acts changes how research services must be paid for

A key driver behind the Delegated Acts is greater transparency around commission payments for research. The regulator wants to ensure that:  end clients know exactly what they are paying for;  a clear separation exists between research and trading activity; and  research cannot be provided as an inducement to trade. The EC’s preferred solution is for firms to pay for research from their own P&L; they believe this removes the risk of inducements (even if the firm then recovers those costs by increasing customers’ fees!).

However, our conversations with asset managers suggest that fewer than 10% of investment firms will adopt this P&L approach; typically those with a research budget of less than $1m or so. Such firms have often cited cost/benefit reasons for moving to a hard dollar model.

Our expectation here is that firms will be allowed to manage payments at the fund level (rather than right down to individual client level) provided that they make clear to fund investors that charges will be in proportion to their holding.

R PA S A R E D E S I G N E D T O ENHANCE THE CONTROLS AROUND COMMISSION SPEND, C O N T R O L S W H I C H C U R R E N T LY T E N D T O E X I S T S I M P LY A S DISCRETIONARY CSA BUDGETING OR MONITORING PROCESSES

RPAs create an opportunity for firms to provide better value

The majority will opt to pay for research out of a separate Research Payment Account (RPA) that they control, funded by client money specifically allocated for this purpose. Whilst many asset managers currently operate Commission Sharing Agreement (CSA) programmes, RPAs are designed to enhance the controls around commission spend, which currently tend to exist simply as CSA budgeting and monitoring processes at the discretion of internal teams.

The Buy Side must take control

An investment firm will be ultimately responsible for their RPA account(s), and this is one of the main areas where the new regime differs from the old.  In the past, CSAs were generally controlled by a broker or bank and often any funds that they manage [on behalf of an asset manager] sit on their balance sheets.  Under the new Delegated Acts, the RPA is categorically the responsibility of the investment firm, even if its administration is outsourced to brokers or a third-party service provider. The investment firm will now need to set clear and external-facing research budgets and collect the corresponding charges from its clients. This brings us to the first potential area of confusion:  The language in the leaked draft Delegated Acts talks about clients, but the reality is that investment firms generally manage their assets at a fund level. To accurately monitor commission spend at the individual client level is generally out of practical reach for most large investment firms. This is because there are often hundreds or thousands of clients in a given fund who can change on a daily basis.

Firms are seeking clarity on how the Delegated Acts will impact research budgeting: The leaked text states that the budget must be set by the investment firm, but does not specify the level to which it applies – firm, region, fund, or client. One interpretation of this is that firms could be compliant by setting and managing a single firmlevel budget for their research spending. Our view is that firms must be able to demonstrate budgets are being managed at a much more granular level. Best practice will be for firms to provide:  the rationale behind their overall research spend;  how and why this budget is spread across various regions, sectors, teams or funds;  a written policy document that sets out the robust quality criteria used to evaluate their research expenditure and how they ensure its ability to contribute to better investment decisions. In conclusion, in order to prepare for the future, we believe large asset managers may consider grouping funds (which have similar research consumption profiles) together into ‘pools’, and then manage a hierarchy of budgets at the pool level. In reflecting on the distribution of research spend, firms have an opportunity to increase the impact of money spent (or even to reduce the cost burden on their clients!) Investment Firms will be expected to produce justifiable, granular research budgets; doing so is an opportunity to increase the impact of money spent on research. ■ Amrish Ganatra is a Managing Director at Commcise Software Ltd. Commcise provides an innovative fully integrated cloud-based Commission Management solution that incorporates automated reconciliation, invoice management, commission budgeting, service history or consumption tracking, service evaluation (“voting”), commission management, share of wallet reporting and accounting functionality. Commcise is used by over 75 asset managers and brokers globally.


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In the early 2000’s the smartphone hit the market and the concept of having email on your phone transformed businesses. Then came the game changer – the iPhone - in 2007, for both business and personal communication. Voice started to be sexy again! Apple took mobile technology to the next level and showed how we could incorporate and consolidate data, information, Internet and voice into a single multi-touch device! The global uptake of smartphones was a phenomenon with an estimated 1.5Billion in use worldwide seven years later in 2014.

IS VOICE GETTING SEXY AGAIN?

By David Moonie

However during this time the Trader Voice marketplace had not progressed at any real pace and the market was still dominated by the three core vendors: IPC, BT and Etrali, all producing robust dealerboard systems, but which remained standalone from the rest of the corporate telephony platform. Not unlike the old Nokia 3210, forever seen as the best mobile device for making calls and sending texts, but unable to compete with the functionality of smartphones.

Head of Sales, Abide Financial

Ever since the first stock exchange began in Amsterdam 400 years ago, voice communication has been the foundation on how the Financial Markets trade!

However this landscape has started to change. The acquisition of Etrali by IPC, the end of life of historic product lines and more importantly the emergence of new Next Generation vendors such as IPTrade, GreenKey, Cloud9 and Enepath all of whom have started to cause a buzz in the usually steady, reliable (if somewhat boring) space of Trader Voice technology.

Over four decades ago specialised voice systems (dealerboards) were invented to meet the traders’ need to communicate to multiple counterparts simultaneously. These systems were designed to run independently of the corporate telephony system, providing increased functionality and resilience for the demands of the trading floor. The sight of the trader with a handset in each hand yelling, “Buy” in one and “Sell” in the other has been globally portrayed in films, TV and media. However with the rapid growth and speed of Internet and Cloud technology, voice trading started to be overshadowed! The death of voice trading has been mooted annually for as long as I can remember, especially with the closure of the open outcry floors, such as LIFFE in November 2000. Electronic trading was the future; automated trading platforms, FiX Engines, order routing hubs and the growth of electronic trading venues all became the new sexy technology that financial institutes were investing in. The rise of the “Flash Boys” had begun! Nevertheless, with old fashioned client relationships still core to trading, the Dealerboard remained the same steady reliable system that underpinned the trading floor; however the technology was becoming antiquated, stale, and expensive to maintain.

Women

role. The dealerboard is the device that enables them to talk to their counterpart and it does exactly that, so why change? This is a valid point. However the way traders - and all of us - work has changed considerably over the last decade. Just look at your desk, gone is the Rolodex, the calendar and the diary. All are now on your laptop and mobile, and all are synchronized to each other. Now think of the next generation of traders, they have never seen mobile without Internet, all have been using a smartphone and tablet in their everyday life, in fact I doubt many have see a push button telephone! The question for the end user shouldn’t be if the technology needs to change, as it already has! The question should be, “when do I change?”

in

Is Voice starting to become sexy again? Maybe, maybe not; but there is definitely a buzz in the sector and the next couple of years will be of interest. ■

THE QUESTION FOR THE END USER SHOULDN’T BE IF THE TECHNOLOGY NEEDS TO CHANGE, AS IT ALREADY HAS! THE QUESTION SHOULD BE, “WHEN DO I CHANGE?”

Fintech

The “NexGen” vendors are approaching the Trader Voice technology space with a wealth of experience, but without the legacy technology baggage. They are looking to the future and at the way institutions are viewing their trading desktop and their Unified Communications. These new players have focused on developing software as well as hardware, providing multi-touch screen technology that combines the performance of a dealerboard with the functionality of a multi-application tablet; such as video conferencing, web apps, custom apps and voice recording. They have also turned the head on physical infrastructure, eliminating the need for huge real estate to house racks upon racks worth of telephony equipment, this has all been replaced by cloud or fully virtualized environments. In short these new players are bringing the smartphone into the trading floor.

Download your free copy now!

Some debates have been about whether trader voice technology needs a drastic change? After all the traders have multiple systems that provide them with information and tools to perform their

Visit www.harringtonstarr.com – downloads – reports GLOBAL LEADERS IN FINANCIAL SERVICES AND COMMODITIES TECHNOLOGY RECRUITMENT

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FINTECH

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HARRINGTON STARR TALK TO SOME OF FINTECH’S MOST EXCITING BUSINESSES

Michael Ourabah, CEO of BSO Networks, speaks about what attracted him to the company and the industry as a whole. He also offers advice on the lessons he’s learned along the way

1 MICHAEL OURABAH CEO, BSO Network Solutions

Can you tell us about your business? BSO is an Ethernet network, cloud and hosting provider for global businesses wanting superior infrastructure and connectivity to the world’s most dynamic marketplaces. We consider ourselves technology pioneers, especially between emerging and established markets where we design solutions offering the highest availability and lowest latency in the financial industry. Our mission is to use the most powerful technology infrastructure combined with the highest service levels to free businesses from their network challenges. Essentially, we provide clients with the competitive advantage they need to seize global, progressive opportunities as soon as they arise. What has been your journey to current position? Twelve years ago I was studying computer science at university with my friend, and now business partner, Charles-Antoine Beyney. It was the early days of the Internet when slow, unreliable networks were commonplace. We found ourselves frustrated with the high latencies and stuttering connectivity. Instead of putting up with this, we channelled our frustration

into developing our own high performance, low latency network. Charles and I quickly realised that we weren’t alone in our frustration and that we were able to apply our engineering knowledge to help other businesses facing the same issues. That was when BSO was born. What interested you in this space? For me, there is nothing more satisfying than when a client tells us we’ve made a real difference to their working life and how they run their business. I love a challenge and problem solving is a real passion of mine. When others say there is no diverse path available or that a lower network latency isn’t possible, it sets the team and I on a mission to find a solution for the client. Our network is continuously refined to provide a service that is faster, more secure and even more reliable each day. How have you settled into the business? BSO is doing very well, particularly over the last few years. We now have over 70 points of presence around the globe, including over 20 financial exchanges on our core network. Each area of the business is expanding and we’re continuously reinvesting in our own

We consider ourselves technology pioneers, especially between emerging and established markets

operations to maintain our customer experience as we grow. Last year we opened a regional headquarters in New York, taking our offices total to six worldwide. I see a very bright future ahead for us! What lessons did you learn in your previous role? Forming BSO whilst at university gave me a remarkably different perspective. We have never been defined by a certain way of doing things, conforming to the ‘status quo’ of the industry. Instead, I had a fresh outlook to reengineer the approach of the traditional telecoms industry, placing client satisfaction and high levels of service at the very centre. I surround myself with very talented, passionate people from a variety of backgrounds and cultures. As a team, our knowledge and experience is extremely broad and we have experts in every pocket of the business. Recruiting the best talent available is a tough task for any company, but we’ve always made it a top priority. Where do you see the opportunity for you in the UK and European market? Our strengths really lie in connecting established European markets and emerging markets, particularly in the Middle East and APAC regions. Financial growth in traditional markets is still very low. Ultimately, it is our customers who drive how BSO evolves and the opportunities we search for – if European organisations wish to connect to other marketplaces, that is what we will focus on. Many of our most significant innovations have come from this approach. For example, listening to customers, understanding what technology they require to leverage emerging marketplaces and designing a service meeting their needs. The financial community has responded extremely positively and the momentum shows no sign of slowing down.

I surround myself with very talented, passionate people from a variety of backgrounds and cultures. As a team, our knowledge and experience is extremely broad and we have experts in every pocket of the business.

What are some of the major challenges facing the industry that your company overcomes? I’d say our ability to react rapidly to change is one of our core strengths. Many other network providers just don’t have the flexibility to operate this way. We design and implement new routes extremely quickly without compromising on performance, reliability or security.


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For example, we delivered Fidessa’s fully diverse, low-latency Singapore to Hong Kong route within three months. There’s also the cultural challenges we help overcome. Accessing diverse marketplaces such as India, China and the Middle East requires a careful, considered approach. When business cultures collide, issues can easily arise – we see our role as a guiding force that manages the entire relationship for the client.

MICHAEL OURABAH CEO, BSO Network Solutions

How does your company differentiate itself from its competitors? One of our defining differentiators is our independence. As a privately owned company, we have always recognised the value of owning our own network and cloud infrastructure, an autonomy that we guard fiercely. But we remain infrastructure-agnostic, which means without the restrictions of our competitors who have invested in cable consortiums or built their own data centres, we have no hidden agenda. No investment to justify or huge debts to subsidise. Instead, we have the freedom to adapt our network and services to suit the changing needs of our customers in real time as the world’s markets develop. This gives our clients a genuine competitive edge. Where do you see the future of the market heading? I spoke at a symposium about this in Dubai. There are so many transformative technologies emerging and many clients are looking to us for guidance on how to adopt these and how the network should evolve. There is a lot of discussion at the moment about the competitiveness of HFT – it’s a sub-market that’s particularly difficult to regulate because of the speed at which it operates, as well as its scale. Despite apprehensions, I believe the power of technology to be a force capable of delivering financial benefits on a global scale. Our world will become increasingly smaller; financial services, a more united

define industry policy and governance – it’s often considered a ‘dry’ topic, however the sector never sits still and it must be challenging from a macro-economic perspective.

industry; and there will be a wider diversification in trading strategies and how markets intersect. What do you feel are the biggest obstacles facing the industry? Regulation is often the largest, purely because of the pervasiveness of global financial markets and the speed at which technology accelerates decision-making. The international regulatory landscape often collides with local economic policies, nationalistic control and political positioning. Regulation affects every aspect of global finance, including telecommunications. I have to say, I do not envy those that

How do you plan to overcome those obstacles? Knowledge and patience are two important characteristics we look for in everyone we hire. Our customers want to know that when they access a new location, their technology is compliant, adheres to local regulations and is designed with redundancy. We embed ourselves in each region we provide access to. That means as soon as there’s a change in local regulation, we adapt our services immediately and keep the client informed about how their technology is operating. We also build new services to be compliant with upcoming regulations, which allows our customers to stay ahead of these changes rather than having to react under time pressures.

As a privately owned company, we have always recognised the value of owning our own network and cloud infrastructure, an autonomy that we guard fiercely.

that could see a lot of change. Automation and Big Data analytics are also very exciting to track. What do you think the financial services sector will look like in five years’ time? It’s difficult to say, five years is a long time in this industry! I think we’ll see a different relationship between exchanges, brokers and traders. Exchanges are investing heavily in their own technology infrastructure and trading firms are looking for more direct interaction with marketplaces and the data they hold. This will definitely have an effect on how global finance flows across borders in the future. ■

What makes your company an employer of choice? Diversity, passion and a clear vision. As I said before, our people are our most valuable asset so we make sure they are well rewarded and motivated. We hold a lot of team events and everyone knows that there is always support available when they need it. One of my main focuses is ensuring we stay true to our founding mission as we grow. This means creating an exciting, interesting place to work with real purpose.

www.bsonetwork.com

What areas of financial services do you see as most ripe for disruption by technology? This topic came up when I was speaking in Dubai. The buy-side/sell-side relationship has changed dramatically in recent years and this is something that will continue. Advancements in how traders develop multi-region strategies is another area


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FINTECH

FOCUS

HARRINGTON STARR TALK TO SOME OF FINTECH’S MOST EXCITING BUSINESSES

With over 25 years’ experience in financial technology, Steve Colwill offers his view on the future of the market

2 STEVE COLWILL CEO, Velocimetrics

What can you tell us about your business? Velocimetrics enables financial institutions to track and continuously analyse the real-time status of all orders, trades or payments being processed. Delivering complete operational oversight, users are instantly alerted to any changes to the way in which these items are flowing that could indicate emerging performance, operational risk, client experience or regulatory concerns. Providing the real-time view required for effective “in the moment” decisionmaking, clients are often able to act

The financial sector is fundamental to the UK economy and it’s great seeing political leaders such as Boris Johnson and David Cameron supporting FinTech.

quickly enough to avoid an issue entirely. And when this isn’t possible, use actionable insights to bring the issue to its resolution in a swift and controlled manner, whilst simultaneously quantifying the real business and client impact. Velocimetrics was formed in 2009 and our client base now spans 6 continents. We have clients that use our technology to assess the quality of the market data they are receiving and others that use it to identify risks in their HFT and algo trading processes. Then at the other end of the spectrum, it’s used in settlements and payments processing. What has been your journey to your current position? I’ve been working in financial technology for over 25 years. My background is engineering high volume real-time pricing and trading systems. About 7-8 years ago, I was a partner in a consulting firm and a client asked me to design and build a system that would track their equity orders on an international 11-centre basis. The problem they faced was that when an order went missing, finding and fixing it could sometimes literally take days. As well as the manpower costs, there was a reputational cost to the client too. It seemed crazy to me they couldn’t buy such a solution off-the-shelf. However, it appeared that whilst many companies were offering technology that would tell you if your servers in London and Hong Kong were running or the effectiveness of your network, none of these solutions could actually determine if orders were flowing, how fast they were flowing or where a particular order was in the system. It was the realisation that everyone else was looking at this problem from an infrastructure perspective, versus focusing on what trading firms really cared about – the orders and trades being processed,

which led to the concept of Velocimetics. To paraphrase Bill Clinton – it’s the business flow, stupid! Since this time there’s been the HFT and low latency wave through the industry, but the underlying requirement for operational oversight has never disappeared. In fact, the regulators are now demanding it. Where do you see the opportunity for your business in the UK and European market? The financial sector is fundamental to the UK economy and it’s great seeing political leaders such as Boris Johnson and David Cameron supporting FinTech. Because the financial services industry is so important to this country, it attracts top IT talent, and as a London based FinTech firm that’s great for us, it’s enabled us to hire some really smart people. However, in terms of how we look at the world, for our sector I don’t think there is such a thing as a UK or European market anymore – the reality is that everything is now much more globally interconnected than that. The firms we sell to are used to working virtually and on a distributed basis. Compared to 10 years ago, there’s much less resistance to working with companies like us, that may be around the other side of the world physically, but can still work with them directly via VPNs etc. Today it’s really much more about domain knowledge, rather than where your staff might happen to be. What are some of the major challenges facing the industry that your company helps its clients to overcome? From a trading perspective the major challenge impacting most firms is regulation and the huge swathes of new obligations on the horizon. We’re working with firms to help them achieve the level of understanding of what is really happening to their orders and trades on a real-time basis, needed to effectively meet evolving requirements.

In comparison, for the banks operating payment platforms, one of the biggest challenges faced is the emergence of new entrants. The traditional players often operate extremely complicated payment systems, built using legacy technology, with functionality added following mergers and acquisitions, or to meet regulatory and client demands. In some cases, these systems are now so incredibly complex that understanding how everything fits together is beyond the organisation’s collective comprehension. Managers in those firms face the double-whammy of serious challenges to keep things going as they are, whilst simultaneously having to innovate to compete against new entrants. In comparison, the challenger organisations have entered the market with client focused, state-of-the-art platforms that are real enablers of innovation. Our technology helps people get their arms around their current systems and reduce running costs whilst improving reliability and customer experience. This frees up money, focus and energy to innovate. How does your company differentiate itself from its competitors? Instead of monitoring an environment by looking at the health of the infrastructure or the IT process, Velocimetrics is focused on the trades or payments flowing across business processes. To effectively track these items, from the moment they enter the process to when they complete, Velocimetrics’ technology detects, the often very complex, cause and effect relationships that exist between different data elements. When correlated together they tell the complete story, so we identify, for instance, the precise market data tick that drove an algo to execute an order and the resultant trade, providing adopters with a realtime understanding of the end-user’s experience. Because Velocimetrics’ technology


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STEVE COLWILL CEO, Velocimetrics

www.velocimetrics.com

will do all of this in real-time, users can effectively predict how well their operations are likely to behave during upcoming events and take proactive steps to ensure they can cope. Furthermore, because Velocimetrics is examining trades and payments, instead of concentrating on server, application or network health, when an issue occurs, users can not only determine where and forensically investigate it, but also identify exactly which trades have been impacted, how and the clients they belong to. Ultimately, Velocimetrics is about providing solutions that deliver as much value to the business as they do to technology. Q. Where do you see the future of the performance monitoring and analysis market heading? I think there are two key trends that have started to emerge that we are going to see much more of. Firstly, the continued move away from using performance monitoring and analysis purely as a means of effectively reacting to incidents that have already occurred, but instead as a way of proactively avoiding these incidents happening to start with, through the increased use of predictive analytics. Secondly, I think artificial intelligence in the form of machine learning is going to start playing a bigger role in this industry. Machines are very good at automating routine and highly repeatable tasks, of which there are many being manually conducted at present by firms monitoring and analysing operational performance. Automating these tasks frees up resources to focus on more profitable activities. Q. What are your plans for 2016 and beyond? We plan to continue innovating in the area of real-time data correlation and analysis, so we can provide clients with a richer array of instantly available predictive analytics that they can use to form

powerful actionable insights. With this information, clients will be able to prevent an even broader range of issues, such as costly SLA breaches, occurring to start with. It’s all about enabling users to more effectively manage and proactively control their operational environment. Secondly, we are currently investing in building more intuitive solutions. For example, to enable a monitoring solution to effectively alert users to abnormal activities, the system needs to understand what normal looks like. Configuring the technology so it recognises that, for instance, a particular instrument in a market data feed should tick a certain number of times a second is currently a very manual task. When you consider a bank might be receiving feeds including hundreds of thousands of instruments, and what is ‘normal’ changes overtime, the manual administration of thresholds is a significant overhead. In 2016 and beyond we’ll be looking at how we could employ machine-learning capabilities to help alleviate the need for such manual tasks. Q. What area of financial services do you see as most ripe for disruption by technology? I strongly believe the payments sector will look significantly different in the not too distant future. This is currently a rapidly evolving space. The advent of digital currencies, peer-to-peer payments and contactless payment systems are transforming the retail market and the desire for increased convenience, even faster and more transparent transactions is only likely to spread to the corporate sphere. We live in a world where we expect information on-demand. However, over recent years we’ve witnessed a stream of banks experience software glitches that caused problems for thousands of customers. In many cases, customers became aware that they had been impacted, before the bank did. So when

they sought information, the bank was only able to provide limited details. The degree of attention from the national media and accompanying regulatory fines these incidents now attract demonstrates their lack of social acceptability and are a call to action. Technology has the potential to massively disrupt this sector and the availability of alternative offerings is only set to increase. To effectively compete and retain clients, more traditional players need to innovate and improve experience levels. So the next time an incident occurs, the bank knows precisely which clients have been impacted and how, enabling clients to be proactively notified and their experience effectively controlled right through to the point their transaction completes. Q. What do you think the financial services sector will look like in five year’s time? If I was asked, what types of firms I think will thrive in the new world? I’d have to say, I think it will be the firms that, in the slightly adjusted words of Jack Welch, have changed before they’ve had to. Those who are building businesses where they have their operational ducks in a row, where they know what’s coming up and how they plan to control it, the types of firms that know exactly what their client experience is here and now – not once the client has been negatively impacted. In the new world, these clients will be going elsewhere, what we used to perceive as barriers to exit across so many sectors of financial services are being removed, either through technology change or government action – portable bank accounts being an example of the latter. I also believe innovation will be key, we’ve seen huge amounts of it in recent years and being able to continuously evolve to meet client and lets not forget regulatory demands (as those guys are going nowhere) will be an essential capability for the firms that will be staying ahead. ■

We live in a world where we expect information ondemand. However, over recent years we’ve witnessed a stream of banks experience software glitches that caused problems for thousands of customers.


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SOFTWARE VENDORS

Market news & commentary

THE SOFTWARE VENDOR Market remains highly competitive with functionality and price remaining as two of the biggest factors for a business when deciding on a new software system. DURING AN IN DEPTH CONVERSATION with a client recently, who have an excellent name in the portfolio management space, they have highlighted lots of new business has been won and they are currently ahead of their competitors due to the improved functionality of their solution/systems and also they have decided not to charge clients for the implementation of their software. This shows that if your system stands still and you do not incorporate improvements and change, then you will be left behind by your rivals in the current market place.

Bite size news from the financial services and commodities technology markets

AMPHORA, a leading provider of Energy and Commodities Trading and Risk Management systems has appointed a new CEO (Risk Nelson). Risk joins with a wealth of knowledge with the E/CTRM space and is looking forward to the new challenge. They are essentially re-launching the company following this C-level hire and, to emphasise this, announced fantastic figures of 20% client growth for 2015. In a difficult choppy market where larger competitors have been involved in M&A to help gain larger market share, Amphora have done it differently. AMPHORA looked at their product and listened to their clients and used the architecture skills they have in-house to continue the improvement of the application and built a fit for purpose system that meets clients’ wants and needs for the current market climate. FIDESSA and Alpha Omega are the latest to engage in a partnership and one that certainly makes a lot of sense with Fidessa being one of the household names of FinTech and Alpha Omega one of the pioneers of FIX-based solutions. Together they are able to offer a one stop solution for post-trade affirmation. This is an exciting development for both businesses and they are able to offer a low cost affirmation processing services to Fidessa’s extensive community of buy and sell sides globally. TERADATA is rolling out a new solution which it says will provide a simple and automated way for businesses to carry out regulatory reviews and guarantee compliance in their digital communications by detecting suspect material. WE HAVE SEEN A LOT OF GROWTH within the Vendor space with more and more start-ups popping up. Leaving legacy infrastructure software vendors scrambling to evolve their portfolios and new technology and delivery models change everything.

FINTECH/DISRUPTIVE TECHNOLOGY

During an in depth conversation with a client recently, who have an excellent name in the portfolio management space, they have highlighted lots of new business has been won and they are currently ahead of their competitors due to the improved functionality of their solution/systems

COMPANIES LIKE CHARLES RIVER are always looking at ways to stay at the top but other legacy vendors are struggling to stay up to date. RISK MANAGEMENT remains a booming area for software sales and is on a similar standing as regulation in terms of being a key area for financial firms to focus their IT budgets on. We are hearing reports of strong sales from a wide spread of vendors which suggests a good level of opportunity in the market across the buy and sell side. We anticipate this to continue for the foreseeable future as companies look to reinforce their ability to manage market, credit and liquidity risk more effectively. A NUMBER OF START-UP FINTECH SOFTWARE VENDORS are looking for exceptional and talented DevOps Engineers to add value to their teams. By implementing a DevOps approach this will ultimately result in a shift in IT culture, in that processes are modified and workflows simplified between technical groups rather than employing specific tools. These DevOps tools can be used by organisations to make it easier to share information and automate processes by reducing deployment times. Ultimately it helps businesses get much closer to continuous integration and deployment ideals.

IT IS SAID THERE ARE 3 ESSENTIAL INGREDIENTS FOR SUCCESS in FinTech. 1) Talent. There are 60,000 people employed in FinTech in London which shows there is an abundance of talent in areas such as engineering, maths, coding and designing FinTech apps. Something very apparent in the UK which makes it stand out is the promotion of diversity as we have a higher percent of female FinTech leaders in our firms than the rest of Europe. London was recently rated the number 1 city for financial services in the world and with 250+ languages spoken, we have the most diverse landscape in the world to develop new solutions. 2) Technology. Currently there is huge opportunity to offer customers and consumers better financial solutions. There are roughly 2 billion people using smartphones in the world with this set to triple in the next 4 years, meaning financial services applications will keep being adopted en masse. 3) Investment. UK investment in FinTech is huge with over $12 billion in 2015, second only to the US. This huge investment has shown it's not only start-ups that care about FinTech as banks and the like have started to focus on capital efficiency and keeping up with the disruptive FinTech companies. THE OCC (Office of the Comptroller of the Currency) a top US regulator, are trying to find better ways to understand and ultimately regulate new and disruptive technologies, such as BlockChain. The move has been welcomed in a lot of quarters with many commentators applauding the news MISYS, THE LEADING FINANCIAL SOFTWARE COMPANY, announced it has appointed Mourad Ayachi as European Head of Professional Services and Bob Kubala as Regional Sales Manager for North America for its Investment Management division. Both will support the Misys FusionInvest product suite, a fully integrated portfolio and risk management system for buy-side firms. MISYS are looking to build out their buy-side offering with these hires, and looking to build market share within the buy-side specifically. MOURAD AYACHI joins Misys from Murex where he was Program Director for Europe and North Africa. He started his career in investment banking at Indosuez and joined Murex in 1998 where he held a number of senior positions and was a founding member of its Professional Services business. BOB KUBALA joins Misys after spending more than 12 years as Vice President, Sales at FactSet. “Misys has made great progress in the buy-side space in recent years, and the FusionInvest solution is poised to make a significant impact among portfolio managers


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within in the North American market,” he said. “In addition, the leadership team’s commitment to investment in product development sets it apart from its competitors. I am delighted to join the team and help expand our footprint in this market.” NEXT GENERATION, Real-Time Collateral Optimisation Capabilities such as CloudMargin have recently announced, are part of a continued movement to harmonise process across asset types. CLOUDMARGIN USERS can now consolidate inventory across multiple custodians around the world, combine disparate collateral pools to maximise usage and make the optimum usage of available, or re-hypothecated assets – all without continual user intervention. COULDMARGIN have been consistent in their delivery with innovative solutions for the OTC Derivatives. This new advance will allow clients the benefit of real-time collateral optimisation across all of their margined business lines. LONDON HAS GROWN to be a global FinTech hub, but recent sources and clients we have been engaged with have talked over the lack of action within the social payment apps. We are predicting a rise in these FinTech companies spinning interesting apps out. CIRCLE HAVE JUST LAUNCHED THEIR APP, which allows money to be transferred with messages including the use of emojis, which is fun, easy and free as well as striking a popular theme of making banking more accessible to younger generations. ALSO WITHIN THE INDUSTRY, we are seeing some exciting start-ups bringing some innovative business models, which are being finely crafted by financial engineers and UX specialists. We are seeing companies using ReactJS and functional programming languages to build software that will change the trading industry across financial services and commodities. THE IDEA OF FINTECH and its new technologies is to fundamentally disrupt the biggest players in Finance. Fintech may be on the cusp of an “Uber moment,” challenging old fashioned traditional old fashioned banks. There are a lot of small payments coming through hoping to become replacements for companies like PayPal. WHAT IS IT THAT SETS APART a disruptive FinTech company? It’s not just its technology; it’s also the algorithms and quantitative models that are built into the platform that make a real difference. One of the reasons Algomi was called Algomi is because there is a set of Algorithms and models at the heart of the platform that seek out liquidity in the Fixed Income market. We have seen numerous start-ups hire PhDs

and junior level Financial Engineers as cost-effective Quants who are working on ways to really shake the industry up. So whilst Quant Analyst and Quant Trader positions continue to prove a big draw to mathematicians there is definitely still opportunities for those who want to help disruptive the financial industry. THE MUCH TALKED ABOUT BLOCKCHAIN is still the most exciting thing (in many peoples’ opinion) on the technology horizon. I’m saying it’s on the horizon as whilst it is starting to be used in anger, it is still evolving. Realistically, BlockChain could be the next big thing as it is following the steps that the internet, social media and mobile took. We are at the beginning of that process with BlockChain technology at the moment, and there is a long way to go in order to fully integrate finance, but without doubt there is a lot of promise there.

INVESTMENT BANKING IS THE INVESTMENT BANKING SECTOR worrying about FinTech? Recent surveys show that there is less growing concern over FinTech disrupting Banks. The major banking groups believe that the Fintech companies will be able to build sophisticated models/ products, but gaining customers is where they will become stuck and need to partner with each other. FROM A RECRUITMENT PERSPECTIVE we are seeing a lot of talent from IT wanting to move out of the

Realistically, BlockChain could be the next big thing as it is following the steps that the internet, social media and mobile took. We are at the beginning of that process but without doubt there is a lot of promise there.

banking space to work with these companies due to the technical challenges, exposure to the full architecture and freedom to implement some of the latest technologies.

working in Financial Services technology then I would highly recommend that you become up-to-date on current affairs with everything IOSCO related. IT STANDS FOR THE INTERNATIONAL ORGANIZATION OF SECURITIES COMMISSIONS (IOSCO) and it is an international body that brings together the world´s securities regulators and is recognized as the global standard setter for the securities sector. IOSCO develops, implements, and promotes adherence to internationally recognized standards for securities regulation. This regulation comes from a higher governing body to protect and regulate the way we so business today in Financial Services Technology and a lot more clients are becoming interested. Candidates with such knowledge that can help, shape and influence a business will surely find themselves at the front of the queue with job offers that will be very hard to turn down. For more information on IOSCO and to learn A-Z about this regulation I would recommend you spend your time navigating around this link: https://www.iosco.org.

Q1 IS ALWAYS A CHALLENGING TIME for people working on the sell side and Banks tend to have minimum movement of staff at this time of year. This does usually change and coincides when spring arrives, days get longer and Bonus time sets in. With this in mind and the fact that Banks are tending to do a lot of outsourcing, we are finding a lot of candidates are open to moving into consultancy and vendor space using their expertise and system knowledge in a different environment. This tends to be an interesting proposition because people tend to be “pigeon holed” in the big organisations such as the Tier 1 Banks and being a small piece of a very large jigsaw. These candidates have now been given the opportunity to join smaller organisations where they get the chance to play a big part in full life cycle projects. We have recently seen a sharp rise of Java Developers, especially, leaving the large investment banks and wanting to join medium size or smaller companies which can further attest to this.

A S S E T / W E A LT H / I N V E S T M E N T MANAGEMENT & HEDGE FUNDS

WHAT FEW HIRES WE HAVE SEEN IN THIS SPACE, have become subject to hiring freezes which has led to the market place becoming very competitive. A number of clients have stressed that even when staff have left they have been left unable to replace some key hires within the business, this has meant when some areas are hiring they are able to be very precise in the skill sets they are looking for. Key areas have included the regulatory space with mangers looking at Dodd franks, EMIR and MiFID II, Some IT managers are now spending up to 30% of their budgets on regulatory change programmes. This couples with Murex and Calypso experience seems to be setting apart candidates in the hiring process.

WANT TO GO INTO TRADING? You’ll need to know coding. ALTHOUGH IT WAS DIFFERENT in the past there is now no way round the fact that if you are interested in going into a career in trading you’ll need to have at the very least an appreciation of coding. The type of languages you’ll need to have worked with could be one of a number including Python, R Matlab, VBA or the object oriented ones such as C++ or Java. So much of trading now relies on systematic modelling (even parts of discretionary trading) without having core knowledge of the technology and programming it will be extremely difficult for you to move forward.

EUROPE’S BIGGEST BANK HSBC said in June that it planned to slash nearly one in five jobs and shrink its investment bank by a third in response to sluggish economic growth and tighter global regulation of bank balance.

THE HEDGE FUND INDUSTRY looks like it is picking up after a slow start to the year. After the worst start to the year since 2008 hedge funds repaired some of the damage in March as investments in equities, fixed income and commodities increased dramatically. Bloomberg News said that nearly 70% of hedge funds in the world advanced last month with on average 2.3% returns. The drastically improved performance was said to be largely down to the gains generated by long-short equity and event driven strategies as markets rallied.

OTHER BANKS such as Barclays still needs to cut costs and analysts predict headcount could fall by another 5,000. A hiring freeze is already affecting many parts of the bank. ALL THIS TOGETHER should make for some interesting times ahead.

ASSET MANAGERS have been looking to add business analysts to their team, in particular business analysts with an in depth understanding of the front office and back office workflows. On the perm side Asset managers want a broader range of system experience rather than one individual system i.e. Charles River, but in particular that strong business knowledge around the front and back office functions.

IOSCO has been a very hot topic within the Financial Markets for 2016 so far. We are hearing from all around the City that clients are looking at projects that are heavily based in the IOSCO area and the problem is…well, there aren’t many people that actually understand this regulation! If you are


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TILNEY BESTINVEST, a leading investment management firm, has acquired Towry for £600 million to continue the recent trend of big acquisitions in the buy-side space. The deal which is still subject to regulatory approval, should it go through will result in Private Equity firm Palamon Capital receiving a return on its initial investment of 13 times. BLACKSTONE ALTERNATIVE INVESTMENT ADVISORS (BAIA), an affiliate of Blackstone’s hedge fund solutions business, will be closing the Blackstone Alternative Multi-Manager Fund, the smaller of its two mutual fund products. Blackstone launched BXMMX in the middle of 2013 as a dedicated vehicle for Fidelity Investments. Blackstone will now liquidate the fund by the end of May 2016. FOLLOWING THE RECENT SALE of Barclays POINT – Risk Analytics and Index Solution to Bloomberg has started to see some ripples through the market. POINT is a strong Fixed Income platform for performance attribution, risk analytics and scenarios. Bloomberg has started that POINT will be supported for 18 after the completion of the sale, after the 18 months users will need to have an alternative and PORT has being the suggest system from Bloomberg. THE IMPACT ON THE BUSINESS has have been received with largely negative reviews – Users of POINT were shocked at the sales and retirement of the system. Some clients are currently finishing off implementing POINT and are now looking at alternatives to replace the current platform. The major concerns are limitations in the functionality of PORT, historical data and how migrations will be conducted. STATS CONDUCTED FROM CITISOFT STATES that “Over 92% of respondents use POINT for risk analytics, but 0% of respondents believe PORT can fully support their risk analytics needs for fixed income. Similarly, no respondents believe PORT fully supports performance attribution, and nearly 40% of respondents believe that the retirement of POINT will have a critical impact on.” A NUMBER OF PERFORMANCE MANAGERS that we have spoken to are concerned and are now creating RFP for new system selection post POINT sales. FULL STACK DEVELOPERS with Angular.JS experience has been a key hire for the buy-side community. TOWARDS THE END OF LAST YEAR we spoke with a number of clients who were all interested in looking at overhauling the front end part of their platforms. From both internal and external websites clients have been looking at how they can improve then user ability and looking at creative technologies such as JavaScript, Angular.JS and mean stack technologies to use to implement. With those technologies in mind clients have also looked at Developers who

are just as skilled using backend technologies such as C#.NET or Java. This full stack ability has really started to become a popular choice of profile within the Fintech Market and it has proven to drive rates up to secure such talent. Candidates who have this experience are easily now commanding somewhere between £600 - £650 compared to the £500 - £550 during the last quarter of 2015 DATA MANAGEMENT has been a critical subject, not just in the Buy-Side space but across all industries. Data Redundancy, quality, governance, transparency are issues all too often talked about. A product that has embedded itself across a number of organisations across the buy-side space is Markit EDM. Professionals with experience in this highly growing contract space are continuously in high demand and a trend is that companies are undervaluing their permanent experts in this space. Contractors with Markit EDM experience can expect high rates starting from £500 per day and with a number of new large Asset Managers buying the product in the last 12 months, the rates and Markit is set to stay competitive. WHEN SPEAKING TO CANDIDATES they have shown great interest in moving to asset/wealth/hedge fund organisations. Some of these companies have a great name on the market which normally gives the candidates a huge interest to work for them. Rather than being just a number in the larger organisations they can make a big impact on the business with their skills and expertise.

C O N S U LTA N C I E S BUY SIDE CONSULTANCIES are consistently looking to add Business Analyst consultants to their teams. With a steady pipeline of projects coming up at Asset Managers and expansion of their client base has required them to look to add consultants to the team. These consultancies are looking for multiskilled candidates with expertise across different solutions; in particular BlackRock Aladdin and also Bloomberg AIM are systems where there is a shortage of candidates on the perm side with an in-depth working knowledge and are requirements in particular for these buy side consultancies. A NUMBER OF OUR SMALL-MID SIZE TECH CONSULTANCIES in the buy-side space are reporting steadily increasing project pipelines with their mid-large asset management clients. In particular, it seems there is an appetite for technology change at the moment across front, middle and back office systems. The key driver for these consultancies is to secure top-talent consultants with detailed knowledge of the business of asset management, how they make their money and how various systems assist in their operation.

THE VOICE TRADING TECHNOLOGY COMPANIES NICE and IPC/Etrali are both in an arms race regarding new tools for analytics and compliance. An additional output derived from the analytics is mapping emotional expression by callers to observed behaviours in order to enhance understanding of customer desires, motivations and actions.

BROKERAGES, EXCHANGES, TRADING HOUSES, MTFS, A LT E R N AT I V E T R A D I N G V E N U E S LSE / DEUTSCHE BORSE proposed merger – described as a merger of equals yet Deutsche Borse will own 54.4% of the shares of the new company. This will create the world’s largest exchange operator, trading more than €5.2tn in equities and more than 3,200 companies listed on its markets. Blimey. What happens if ICE, the recent purchasers of NYSE, joins the party with a reported $10bn bid to go head-tohead with Deutsche Borse? However it pans out, there’s going to be a global super-power created and that has divided opinion in the City. This is third attempt at a merge and if it goes ahead there will be a €450 million cost cutting exercise.

NEXTGEN NETWORKS, a global provider of high-speed fibre-optic services, announced that it has deployed new Points of Presence (PoPs) in data centres run by Equinix in Tokyo (TY3) and Frankfurt (FR2). HIBERNIA NETWORKS is using Accedian to provide tiered termination aggregation services.

PEOPLE

NOMURA RESEARCH INSTITUTE are working with the Japan Exchange Group and several major financial establishments to test the use of BlockChain technology in the securities industry. BlockChain technology allows anti-tampering stock information management and gets rid of the need for reconciliation between stockholders.

SUNGARD AVAILABILITY SERVICES names Susan Lynch as Chief Financial Officer. Previously, she was CFO for global information solutions at Hitachi. PERSEUS has hired Nigel Warner as European Sales Director. PICO TRADING has hired Gareth Richardson as European Sales Director

THERE IS A DEFINITE DIVIDE between firms who have taken the MiFID II delays as a reason to relax in this area and those who have seen it as additional time to get their house in order. As time marches on, it is highly possible that more and more vendors will come to the market with solutions to help with MiFID II – will companies who have planned ahead ‘too’ enthusiastically miss out on future solutions which could offer promising efficiencies?

L O W E S T L AT E N C Y R O U T E S ?  London to Frankfurt via Custom Connect  London to Moscow via Avelacom  London to Hong Kong via BSO Networks  New York to London via Hibernia Networks

M A R K E T D ATA P R O V I D E R S SR LABS, are partnering with Quod Financial, a leading provider of adaptive trading technology, to support client requirements to integrate the two firms technology solutions

There is a definite divide between firms who have taken the MiFID II delays as a reason to relax in this area and those who have seen it as additional time to get their house in order.

NETWORK, INFRASTRUCTURE, SERVICE PROVIDERS WE HAVE RECENTLY SEEN that a number of the MSPs that we are working with are building out their IT teams quite significantly. They are currently recruiting for hybrid skill-sets to bring on board candidates with many hats. The reason being is that these candidates have multiple offerings for their clientele and as a result they are ensuring that an excellent service is constantly being delivered. The majority of the Engineers are from a Windows background however a Linux skill-set is highly sought after so they are now looking for people with a hybrid skill-set.


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*The sales board by Andrew Watson

Five steps to motivating and retaining great salespeople ADVICE FROM WARREN BUFFET T The Pareto Principle is based on the work in 1906 by the Italian economist Vilfredo Pareto. Initially used to ascertain that 80% of Italy’s wealth at the time was owned by 20% of its people, the theory has moved onto become universally accepted in business. The 80/20 Rule means that 80% of your sales will come from 20% of your sales team. How do you retain and incentivise these top performers without having to constantly up their salaries and bonuses? The American business magnate Warren Buffett (net worth $67 billion in 2015 according to Forbes.com) has identified five rules for motivating and retaining your top sales people. This is not to say a good salary and commission programme is not important – it is. But evidence shows there are other factors that ensure you get optimal performance. By incorporating these 5 factors into your sales management strategy you will get happier, more productive and more loyal salespeople.

WA R R E N B U F F E T T ’ S F I V E FACTO R S F O R M O T I VAT I N G A N D R E TA I N I N G G R E AT SALES PEOPLE ARE AS F OLLOWS GLOBAL LEADERS IN FINANCIAL SERVICES AND COMMODITIES TECHNOLOGY RECRUITMENT 4 0

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1 S E T C L E A R E X P E C TAT I O N S Salespeople perform best when they know what is expected of them. A salesperson’s goals should be fair and reasonable. That’s not to say that the goals should not stretch them. Getting buy-in from the individual salespeople is critical when setting expectations. The best way to do this is to solicit the salesperson’s feedback and involvement in setting their goals. Failure to do so will limit the salesperson’s ownership and can create an “us vs. them” mentality (i.e. “My boss is always raising my goals and doesn’t understand what I’m dealing with. My goals are totally unrealistic. He just doesn’t understand. I can’t do everything he wants me to.”)

Now think, Harris, what did you do different on that day?

SALES

2 GET THE RIGHT MARKETING ST R AT E GY & I T SYST E M S To have a highly functioning sales team, you must develop appropriate marketing strategies for your products and services and the prospects that you sell to. In addition, you need to have CRM and service delivery systems that will support these strategies. One of the biggest obstacles to success is a “winging it” approach. Make sure that you create the systems and tools that give detailed steps for sales success in your business. For example, is the value proposition of your product or service easy to define and articulate? Can your sales team contact and engage with the right customers easily and repeatedly in a systematic way? What analytical tools are in place to track the sales team’s activity and performance? Furthermore Sales Managers need to be evangelists of the strategy and CRM tools. If you haven’t mastered them then why should your sales team?

W INGIN G I T


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DEVELOP A CUSTOMER-FOCUSED S A L E S C U LT U R E

HOLD YOUR SALESPEOPLE AC C O U N TA B L E A N D R E WA R D S U C C E S S

What is your company’s sales culture? Is everyone in your organisation involved and/or supportive of the selling process? Or is there some conflict between the sales department and the operations staff? Often, salespeople get caught up in the role of client advocate because if they don’t, no one else will. And sometimes, the demands on the salespeople can be unrealistic so they react by over-promising which puts an unnecessary and unwanted burden on the operations staff.

This is the part of the job that most sales managers do poorly, but it is crucial if you want a high performing team. One of the toughest parts of managing is dealing with poor performance. Failure to do so, however, is a recipe for disaster. So address issues head-on and quickly. Don’t shy away from the difficult conversations.

The best companies overcome internal challenges by clearly defining and performing in the best interest of the customer. If everyone is focused on how to serve the customer, then these internal conflicts can be avoided or, at the very least, addressed in a productive manner. Sales Managers need to proactively support this customer-centric mind set to all other parts of the company.

After you’ve set clear expectations or goals with your sales team, you must determine the rewards and consequences for hitting or not reaching those goals. A sales manager who tolerates consistent under-performers will de-motivate the top performers. By the same token, Sales Managers must reward success and do so frequently. What happens when your company hires a new salesperson? If you’re like most organizations, you probably have lots of room for improvement here. You’ll need to determine what training is appropriate and how to make it effective. At Harrington Starr we maintain detailed but effective and easy to use Sales Manuals for best practice in recruiting. All new recruitment consultants are put through a “boot camp” to learn and practice these tools. We then maintain a constant on-going use of these methods for recruitment. You’ll need to consider training needs from a number of angles. These include the following:  COMPANY ORIENTATION  INDUSTRY KNOWLEDGE

 PRODUCT/SERVICE KNOWLEDGE  CUSTOMER SERVICE PHILOSOPHY


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5 DEVELOP A CUSTOMER-FOCUSED S A L E S C U LT U R E In addition, you’ll need to provide some level of sales training. This should be much more than having the new hire ride with you or a seasoned salesperson a few times and then saying, “Okay, now go do it.” Most training programs fall short because of the process that is typically used. It’s the classic “throw a lot of information at someone” approach and hope that some of it will actually stick. The reality is that if you use this misguided approach, research indicates that after about 16 days, only 2% of the information is retained. Not only do the trainees not retain the information, but there is no hope that behaviour or habits will be positively impacted. To be effective, training must incorporate the ways that adults learn. This means your sales training incorporate active engagement exercises, repetition, and specific goal setting, as well as direct application and accountability for what’s being learned. Managing salespeople can feel like herding cats at times. By focusing and implementing the five key areas above, you will take the chance out of your sales growth.

“ L U C K I S W H AT H A P P E N S W H E N P R E PA R AT I O N MEETS OPPORTUNITY" SENECA , 60A .D.

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www.harringtonstarr.com EXCELLENCE. EXECUTION. ESPRIT DE CORPS. GLOBAL LEADERS IN FINANCIAL SERVICES TECHNOLOGY RECRUITMENT. THE AUTHORITY IN TECH RECRUITMENT. SUPPORT. COMRADESHIP. WINNING NEW CLIENTS. WORKING WITH A TALENTED AND INSPIRATIONAL TEAM. BEING PART OF AN ELITE GROUP. BEING INSPIRED TO PERFORM AT MY BEST. THE LAUGHS. PROBLEM SOLVING. BEING PART OF AN EXCLUSIVE CLUB. EXCELLENCE THROUGH UNDERSTANDING. CONNECT, COMMUNICATE, COLLABORATE. JOB. DONE. RIGHT. I THINK, THEREFORE I KAIZEN. BEST PRACTICE MAKES PERFECT. INFORMATION, IMPACT & INFLUENCE. PROFESSIONALS WITH PERSONALITY. QUALITY, QUANTITY, DIRECTION. MEET, ADVISE, DELIVER. SPEED, PRECISION, CONTROL. FOCUS, CONFIDENCE, MOTIVATION. PROCESS, PERFORMANCE, RESULTS. BRING THE HEAT. MAKE IT HAPPEN. FUN. TEAMWORK. PASSIONATE LEADERS. WORLD CLASS APPROACH. THE PEOPLE. FAMILY FEEL. OLD FASHIONED MANNERS. YOU CAN CONTRIBUTE. GREAT BRAND AND IDENTITY. GREAT TRAINING. ENCOURAGEMENT. SUPPORT. TRUST & TRANSPARENCY. NO POLITICS. UNITED. RESPECT. VALUES. EXCITEMENT ABOUT THE FUTURE. GROWTH AND PROGRESSION. NEW YORK. HARRINGTON STARR. NORTH STARR. GLOBAL. EUROPE. ASIA. HIGH VALUE, NICHE MARKETS. BRILLIANT BASICS. MAGIC TOUCHES. COMMUNITY. CONTINUAL STRIVING TO BE THE VERY BEST. CONSTANT IMPROVEMENT IS OUR DAILY GRAIL. WE KEEP IT SIMPLE, STAY FOCUSED AND GET THE JOB DONE. NO DICKHEADS! CONTRIBUTION, COLLABORATION AND COMMUNICATION. MULTI BRAND STRATEGY. OUR BUSINESS IS BUILT ON YOUR SUCCESS. EVERYONE IS DIFFERENT. PERFORMANCE PATHWAY. DEVELOPING THE PERSON, THE PROFESSIONAL AND THE RECRUITER. OUR 800 PAGE HARRINGTON STARR PLAYBOOK. INFOGRAPHIC MANUAL BRINGING RECRUITMENT TO LIFE VISUALLY. MENTORING. CLASSROOM SESSIONS FROM BOARD EXECUTIVES. EXTERNAL TRAINING FROM LEADING SPORTS PSYCHOLOGISTS AND MILITARY LEADERS. LEARNING LIBRARY. WEEKLY LUNCH AND LEARN SESSIONS. BUSINESS DEVELOPMENT EVENING SCHOOL. LEADERSHIP RECRUITMENT MBA. CRYSTAL CLEAR PROGRESSION. RIGHT PEOPLE DOWN THE RIGHT PATH. ELITE PERFORMANCE. BART STARR. VINCE LOMBARDI. FLOYD WOODROW. BRITISH CYCLING. SAS. NAVY SEALS. NEW ZEALAND ALL BLACKS. DAVE BRAILSFORD. CLIVE WOODWARD. SIMON HARTLEY. GREEN BAY PACKERS. BRILLIANT EXECUTION OF THE BASICS. WE CONSTANTLY LOOK TO INNOVATE. MARGINAL GAINS. UNFAIR ADVANTAGE. CAR ALLOWANCE SCHEME. BART STARR AWARDS (QUARTERLY CASH BONUSES FOR “ESPRIT DE CORPS”). PRESIDENT CLUB LUNCHES. SUPPER CLUBS AT TOP RESTAURANTS. FREE GYM AND POOL IN THE OFFICE AT VINTNERS PLACE. ADDITIONAL DAYS HOLIDAY ON PERFORMANCE TRIGGERS. COMPANY EVENTS. LEADING COMMISSION SCHEME. THINKS CLEARLY UNDER PRESSURE. GOOD ON THE PHONE. READS THE BUYING SIGNALS. ASKS BETTER QUESTIONS. FINDS THE NEEDS. TURNS OPINIONS. SHOWS BENEFITS. INFORMATION GATHERS. SEEKS EXTRA TRAINING. KEEN TO SELF-DEVELOP. SELF-CRITICAL. KNOWS & USES STRENGTHS. COACHABLE/WILLING TO LEARN. COMMITTED TO ATTAINING EXCELLENCE. GROWTH MINDSET. LIKEABLE. A STORY TELLER. ADAPTABLE. CREATIVE. SELF-COMFORTABLE. CONFIDENT. A “GOOD EGG.” LEAVES THEIR EGO AT THE DOOR. FOCUSES ON WHAT’S IMPORTANT. ABLE TO EXECUTE THE BASICS. HAS HIGH IMPACT ACTIVITY. FOLLOWS THE PROCESSES. HIGHLY FOCUSSED. SMART. LOOKS THE PART. CARES & TAKES PRIDE. SETS THE STANDARDS. PRIDE. INQUISITIVE. ASKS LOTS OF QUESTIONS. FORENSIC. THINKS BEFORE SPEAKING. LISTENS. RESILIENT. TAKES ON CHALLENGES. MENTALLY TOUGH. SELF-STARTER. AUTONOMOUS. THRIVES IN DISCOMFORT ZONE. DE-CONSTRUCTS PRESSURE. OWNERSHIP. ACCOUNTABLE. GOES THE EXTRA MILE. FOLLOWS UP. GREAT IF YOU ARE WATCHING OR NOT. HAPPY TO TAKE THE LEAD. PUSHES THE LIMIT. FOCUSSED ON BRILLIANT BASICS. HIGH QUALITY PREP & PLANNING. STRIVES FOR MORE. THOUGHT LEADER. KNOWS THEIR STUFF. REMEMBERS THEIR STUFF. USES THEIR KNOWLEDGE. KEEPS PEOPLE INFORMED. BROADCASTS THEIR KNOWLEDGE. BUILDS THE BRAND. CONNECTS. COMMUNITY. RELATIONSHIP BUILDER. CONNECTS PEOPLE. NETWORKS. CALMS PEOPLE DOWN. INFLUENTIAL. UNDERSTANDS YSOB. UNDERSTANDS MAGIC TOUCHES. GREAT COMMUNICATOR. GOOD WRITTEN & SPOKEN ENGLISH. GOOD COMMUNICATION. DETAIL ORIENTATED. CREDIBLE. UNDERSTANDS DIFFERENT PEOPLE. HONEST & TRUSTWORTHY. EMPATHETIC. EMOTIONAL INTELLIGENCE. SOCIAL GRACE. SELF-AWARE. SEES THE BENEFITS OF A TEAM. POSITIVE ZEST/PASSIONATE. PUTS OTHERS FIRST.

www.thenorthstarr.com

HOW TO DRESS CASUALLY IN THE OFFICE

T-shirts Make sure you choose t-shirts that fit and flatter in: grey/dark grey, white & black. A selection in these colours, that also show-off and compliment your shape, are a must. Having them in these three different shades means that one of them at least will be able to work with most other combinations of clothes that you put on.

Leather Boots The shape and silhouette of a boot will often tend to lend itself towards a winter outfit that comes with multiple layers. That being said, if you find the right boot, they can also look great with jeans and a t-shirt. The best way is to experiment with both, and find a pair that compliments them both. Enclothed Recommends: H BY HUDSON

Enclothed Recommends: CALVIN KLEIN

[By Toby Cosser, Enclothed] The week is drawing to a close, you could not be happier that Friday and all its perks have arrived – however there is just one ominous consideration; DRESS DOWN FRIDAY. Free from the shackles of a tie, uncomfortable shoes and a restricting blazer yet faced with a fresh dilemma; what to wear? Enclothed (www.enclothed.co.uk) was launched just under two years ago by two young entrepreneurs, Levi Young and Dana Zingher. Enclothed is the men's online clothing service that uses algorithms and dedicated in-house stylists to assess the clothing requirements of each customer before remotely curating a box of clothing based on the customer's size, budget and style preferences. The items the customer keeps, he pays for and anything he chooses to return is collected, also free of charge. Each item returned provides the stylist with crucial data on the likes, dislikes and clothing preferences of the customer, so that each box he receives gets better each time.

A key point to consider, is to retain a certain sartorial standard without appearing formal or too dressed down, for example, light denim is a huge leap from a formal trouser and potentially something to avoid, likewise for ‘over the top’ prints and logos. Bottom line, keep it classic, cool, and understated but not devoid of personality. Here are some suggestions that every causal capsule wardrobe should include and what every man should bare in mind when they are faced with the challenge of dressing casual to work.

Enclothed is the ideal tool to help you manage your wardrobe and get to grips with how to dress casually in the office!

Casual Shirt For those times when you don’t want to be in a t-shirt but a smart button-up is just too much. Great to throw on over a t-shirt and keep you warm, or smarten you up. Enclothed Recommends: SUNSPEL

Fitted Jeans A good pair of fitted jeans are the cornerstone of so many people’s wardrobes. Once you work out what cut is best for you, building outfits around it becomes simple. Experiment though, and try not to be completely drawn to skinny or straight or whatever else you prefer. There is a wide array of styles out there, so find your best shape.

Bomber Jacket The bomber jacket is perfect for those not so formal occasions. Its minimalism is cool, collected and sure to make you stand out.

Enclothed Recommends: LEE JEANS

Enclothed Recommends: TOMMY HILFIGER

Over all these are key pieces that we believe are necessary wardrobe tools that will make the grueling decision making process much easier.

environments. (With of course the option of an over coat as appose to a blazer.)

If you are cemented in smart attire and wish to take an even smarter casual approach, a shirt/jumper combo with a pair of jeans is always a winner and a personal favorite for the majority of men within office

Enclothed recommendations are brands that we think are best suited for each individual item… try them out! Use discount code “HARRINGTON10” for a 10% discount on your first order.


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Selling the dream

Gemma Roberts is a chartered psychologist, specialising in business, career and resilience coaching. Gemma is the founder and Managing Director of Kona Coaching, and in this interview she’ll fill you in on the science behind building a Resilience Advantage to create strong, sustainable success for you and your organisation.

K NA

COACHING

Once armed with my chartered psychologist status, I began to consider what to do next. Again I had to reflect on what I’d enjoyed (and not enjoyed) in my career and decide what my next step was. After a few of years of consulting projects working on coaching and development in organisations, I took the leap and started Kona Coaching.

What can you tell us about your business?

The ethos behind Kona Coaching is to help people do work they enjoy - whatever that may be. For some that may be promoting in an organisation or creating a successful corporate career, and for others in may be starting a business or creating a portfolio career. What I specialise in is helping people achieve their goals, but more importantly I help people to break down the barriers that stand in their way, build their resilience (their mental toughness so they can keep moving forward), and to master their mindset. I really am a psychologist through and through, and I wanted to create a business that is commercially relevant and accessible and the plan is for Kona Coaching to pioneer a new wave of career coaching in the UK and eventually globally.

Kona Coaching is a training and coaching company that’s a bit different. We take the best of psychological methodology, extensive commercial experience and in-depth knowledge of coaching and development practices to create coaching and training programmes that yield tangible results. Our main areas of expertise are resilience training (increasing ‘mental toughness’ to cope with adversity), career development and career change coaching, career branding training, leadership training and training focused on building resilient sales teams to increase performance (which is unique to Kona Coaching).

What has been your journey to current position?

What interested you in this space?

I started out as a psychology and sociology graduate, with no idea what to do with my career. I knew I wanted to work with people in organisations (which were both a passion), but in reality I had no idea how to do that. It started with a bit of trial and error in the HR world, working for large corporations in the areas of graduate recruitment, generalist HR and recruitment, and eventually I figured out I wanted to help people develop in organisations so I moved into learning and development.

I’m naturally inquisitive and I’ve always been obsessed with learning how and why people create success. I joke that my current job started in primary school, but it really did. I’ve always loved autobiographies and learning about how people have achieved great things across different businesses and careers, so I suppose I was destined to do what I do now. I wouldn’t say it’s always been an easy or obvious journey though, it’s taken a lot of reflection and learning about myself, but each career step I’ve taken has moved me closer to what I do now. It’s very easy to connect the dots when you look back, but you can’t always see where you’re going when you’re in the middle of it.

Eventually it became clear that I wanted to use more psychology (or a scientific approach) in my role, and really learn how to understand, motivate and help people make tangible changes and improvements to their working lives. I went on to undertake an MSc in Organisational Psychology, which I completed alongside my role in learning and development at an investment bank, and then continued to work in the L&D field for various FMCG and Professional Services organisations whilst I studied to become a chartered psychologist (which took three years).

How have you settled into the business?

Luckily I’m doing work I love, but settling into running a business has been a whole new adventure.


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What lessons did you learn in your previous role?

and strategies that can be applied successfully in a commercial environment. On the flip side, we’ve come across training and coaching companies who don’t necessarily focus on the psychology (i.e. the science) behind what they’re trying to achieve with people-related activities in organisations, and so these interventions often don’t produce the results organisations expect to see.

I’ve learnt so many lessons in all of my previous roles. I think mostly I’ve learnt what kind of work it is I want to do, and what I’m actually good at (and not good at). I’ve learnt that creating or changing anything in an organisation takes time, persistence and focus. Whether that be a new product, service, culture or team, to really make tangible changes that create results you need to commit and be prepared for it to take time.

Where do you see the opportunity for you in the UK and European market?

There’s a huge market for what we do at Kona Coaching in the UK, Europe and in fact globally. We run face-to-face training all over the world, and because of the online side of the business, our programmes are accessible immediately for people in any location that has wifi or 3G access.

What are some of the major challenges facing the industry that your company overcomes?

There’s been a huge amount of change within the Financial Services sector, and in particular in the FinTech industry, and we’ve worked with numerous Financial Services clients whilst they’ve been navigating these changes and developments. Some changes that have occurred may be generally seen as challenging, and some may be positive, but either way change can affect different people in different ways. From a people perspective (which is our area of expertise), now more than ever it is critical to create a resilient (mentally tough) workforce.

We sit in the middle of these two worlds, we utilise cutting edge psychological research and data (so all of our coaching and training programmes have robust design methodology), but we translate this into programmes that can be easily understood and implemented in the corporate environment. We also draw on our experience of working in the corporate market, so we know sometimes what might be a great psychological theory needs adapting to create results in a corporate environment.

The ethos behind Kona Coaching is to help people do work they enjoy - whatever that may be.

All of our programmes are robust and professional, but also accessible and implementable for everyone. We’re also a bit different in that we have a business to business (B2B) side to the business (corporate coaching and training) and a business to consumer (B2C) division which is aimed at individuals interested in developing their careers.

In times of change and uncertainty, (positive or negative), it can cause increased levels of stress and anxiety. A more resilient workforce is proven to be able to cope with stress and anxiety more effectively, and the impact on the company is less absence, decreased attrition and increased employee engagement. Learning how to be resilient also encourages people to ‘bounce forward’ when they come across challenges, which means they can alter their mindset so they don’t only just ‘bounce back’ to where they were before the challenge occurred, but they can use the experience to propel themselves forward and capitalise on what they’ve learnt to move towards greater achievements. Resilient people also make better decisions and have a greater capacity to build meaningful relationships with colleagues, both of which are qualities that are essential in an continuously developing industry.

Where do you see the future of the market heading? Online learning is a huge trend in the coaching and training industry. Whilst we’ll always have a face-toface element to our business, we’ve invested in our online portfolio of programmes to meet the growing

We’re all psychologists at Kona Coaching, and we’re sticklers for only hiring people that are qualified and have extensive experience. We’ll have roles for graduates and interns where we can help them develop, but anyone client-facing is a qualified psychologist and coaching psychologist, so we know they’ll do a good job. In a competitive market, in order to achieve longevity you’ve got to be good at what you do, and you have to create value for your client - and that applies to any business. My hope is that clients help us to raise the bar in the coaching and training industry by focusing on results-driven interventions.

What makes your company an employer of choice?

demand of online learning. Much of the information we take in today is online, immediately available and accessed whilst we’re on the move, all thanks to advances in technology. We’ve become accustomed to googling anything and everything, watching videos during our commute, reading books and articles on our iPads and phones, it makes sense that we would want to access coaching and training programmes in the same way. This trend will undoubtedly continue, which is why we’ve created online, bite-sized programmes our clients can access wherever they have wifi or 3G signal.

We practice what we preach at Kona Coaching - we help people to do work they enjoy. We help new hires to determine whether our organisation and the culture are right for them, and whether our company and their individual strengths, values and skills match. We’re also focused on helping employees build their resilience, so they can cope better with challenges, and we have a flexible approach to how and when work takes place.

What are your plans for 2016 and beyond?

In the development industry there’s also a growing focus on building a community. People are moving on from the perhaps simpler requirements of old where they wanted to access information and learn on their own, and we’re seeing a move towards people wanting to perhaps learn in their own time, but also be part of a wider community. The concept of social learning also applies here, more and more of us are learning from peers rather than ‘experts’ or ‘gurus’.

We have new live and online training and coaching programmes launching in 2016, focusing on:  Matching candidates to specific careers, roles and organisations  Creating a personal brand  Building resilient teams (in particular sales teams)  Creating balance between work and life

What do you feel are the biggest obstacles facing the industry?

The most exciting launch this year will be our ‘Career Compass Club’ which is taking what we offer a step further by creating a community of people who are looking to develop their careers, enhance their performance at work (whatever type of work that may be) and create success in their future. It’s a new concept and it’s going to be a game-changer for the career development industry. ■

The quality of delivery and products. So many organisations and individuals are marketing themselves as experts without actually being able to help people make tangible changes or see real results. There is also a focus on quick results in the world of personal development (think ‘how to get rich in 30 days’ type courses), and in reality most (if not all) substantial changes take time, planning, strategy and effort.

How do you plan to overcome those obstacles?

We’re massively focused on quality, in terms of our products, services and programmes we create. It’s really important to us (and our brand) that we help people create results they can measure, but also that we don’t over-promise or under-deliver. If you have an ambitious goal, we’ll help you get there, but we’ll make sure you know how much time, energy and effort will be involved so you have clear and realistic expectations.

How does your company differentiate itself from its competitors?

We’ve found often academic psychologists struggle to translate insightful and useful research into ideas


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Talent ID or character ID? By Simon Hartley, Founder of Be World Class.

alent Identification has been a hot topic in sport and business for many years. Every organisation is out to spot those who have what it takes to be highly successful. In sport, it often means analysing the requirements of the sport and then matching promising athletes, who seem to have the attributes required to succeed. There are some highly sophisticated Talent ID programmes, which scientifically measure an athlete’s physiology, physical

of ‘talented people’, which might be difficult to measure. Michael Duncan, from Coventry University, argues that ‘talented people’, from a wide variety of domains, are defined by ‘high energy’, ‘creativity’, ‘imagination’ and are ‘less linear’. In addition, he states that talent sits at the intersection between skills, motivation and creativity. If these attributes are the essence of talent, how can we measure them with real certainty? Are they even measurable? Perhaps this question led researcher, Roel Vaeynes, to state that there was “no empirical support for the traditional approach to talent ID in sport” (Vaeynes, et al, 2009). Michael Duncan goes on to state that the only thing that consistently differentiates International and National level athletes is that the international level athletes have spent 50% more time involved

ability, size, height, body fat, functional movement, medical history, sport history, family history, decision making, self-confidence, motivation, anxiety management and a whole lot more! The NFL Combine uses similar tests to assess the potential of college football players before they get drafted by the NFL Franchises. They also measure speed, agility, strength, power, position specific skills and body measures (amongst other things). The franchises are also allowed to interview players for 15 minutes. This data gets added to the many scouting reports that the clubs hold on each of the athletes. The teams then make multi-million dollar decisions on which athletes to recruit, and which to reject. However, it seems that there are some attributes

in their sport. Perhaps there is a disconnect between the attributes that underpin success, and our attempts to identify talent. Maybe Talent ID programmes look at the wrong things? Interestingly, two of the greatest quarterbacks in NFL history were drafted as the 199th overall pick; Bart Starr and Tom Brady. Neither of these two legendary players qualified as ‘talented’, according to the Talent ID models. Tom Brady, has led the Patriots to a record four Superbowl wins and six Conference Championships. He was awarded the Superbowl MVP (Most Valuable Player) three times and the League MVP twice, making him one of the greatest quarterbacks in history. Incredibly, Brady took part in the NFL Combine. He was considered to be “un-athletic”, “kinda skinny”,

“not strong enough” and “too slow” (his 5.2 second 40 yard dash was well below par). And yet, the New England Patriots drafted him. So, how did they identify that Tom Brady had the potential to become a great quarterback? Dick Rehbein, the Patriots quarterback coach, was sent to scout Brady. He described him as the “best fit for the organisation” because of his mentality, his leadership and, in particular, his ability to “go in and lead his team back to victory”. The Patriots Head Coach, Bill Belichick, also noted that Brady was learning and progressing fast. Belichick saw that Brady had made a significant step up between his junior and senior season as a College quarterback. Belichick also noticed that Brady has two qualities that he prized; he was tough and competitive. Bart Starr was also the greatest quarter-back of his generation. He led his Green

Bay Packers team, with coach Vince Lombardi, to multiple championship wins and the first two Superbowl crowns. He was also voted the MVP in the Superbowl and was the League MVP in 1966. This undoubtedly world class player was recruited in the 17th round of the draft, also as the 199th overall pick. So, why did the Packers draft Bart Starr? Interestingly, Bart Starr was a student at the University of Alabama. Although he played American Football, it was the basketball coach (Johnny Dee) that noticed him and recommended him to the Personnel Director (Jack Vainisi) at the Packers. Rather than focusing on his skills as a quarter-back, The Packers were convinced that Starr had the ability to succeed in the NFL and would learn quickly. It seems that the Packers recruited Bart Starr because of his ability to learn, and therefore his

potential to become great (Hartley, 2015). Whenever I talk to elite sports coaches about the kind of athlete they’re looking for, they don’t describe physical attributes, 40yard dash times, vertical jump scores or body fat percentage. Instead they describe the character of the person. Like Bill Belichick, they are interested in toughness, competitiveness, resilience, tenacity, adaptability, their composure and ability to perform in critical moments, their work ethic and their ability to learn. These are characteristics, elements of character, not physical qualities or even mental skills. So, if we really want to find those with the potential to become highly successful, the question is… Should we engage in Talent ID or Character ID? ■

If you’d like to find out how to assess and develop character, check out the free sample chapter of How To Develop Character http://www.book2look.com/ book/NfeCzVgKjA References • Duncan, M., James, R., Thake, D & Birch, S. (accessed 2016) ‘Talent Identification’, Science and Football.com Available Online – 29th march 2016 www.scienceandfootball. com/uploads/306.pdf. • Hartley, S.R. (2015) Stronger Together; How Great Teams Work, London: Piatkus Books. • Vaeynes, R., Gullich, A., Warr, C.R. and Philippaerts, R. (2009) ‘Talent identification and promotion programmes of Olympic athletes’, Journal of Sport Sciences, 27(13); 1367-1380


5 5

Those

were the headlines from the 4th meeting of The FinTech Influencers, an invitation only group of some of the leading names in UK Financial Technology. Designed to help drive innovation and growth in the UK, we have looked to debate the key trends and pressure points in the industry and build a community of collaboration. The topic of this session’s conversation was “FinTech Bubble or Structural Shift.” Compere Mike O’Hara was joined on the panel by Leanne Kemp, CEO and Founder of Everledger, Rob Casebourne, Global Head of Electronic Trading at Deutsche Bank and Richard Atkinson, Managing Director of Development and Applications at SS&C. Here is a summary of their thoughts. With approximations of investment in Fintech ranging from $4bn in 2013 to $20bn in 2015 the prospect of another bubble has long been on the horizon. Leanne Kemp believes that there has been a plate shift with technology now seen in finance as a solution to problems that can “lift the cloak” and provide transparency. Rob Casebourne suggested that it is not an either/or question. “It is factual that there is a shift” he said “but with the big valuations, there will absolutely be a bubble on the way.” Wealth will be created but companies will “100% fail.” Leanne Kemp agreed citing “dumb VC money” being pushed into FinTech. She urged businesses to use money the right way but claimed that this is not a bubble but happening right now. Richard Atkinson continued that regulation was pushing FinTech innovation and that was not set to go away fast.

BlockChain has arrived

The global warming in banking, BlockChain’s arrival and the insurance tech boom.

BlockChain quickly found itself on the agenda. With recent months seeing numerous BlockChain startups it was claimed that not all will succeed and “a lot of saplings will die on the way.” A year ago, we debated BlockChain in our first session. Today it was far more understood. As Rob Casebourne said “a year ago it was associated with criminals and now it is a technology that can be applied to loads of things.” He continued that it has become real and showcased Blythe Masters work with Digital Asset Holdings having raised $50m and its deal with ASX to upgrade its systems. With the ASX having been set to “replace CHESS with son of CHESS” their signing the deal with Masters made it real. It was the moment when the market could say “this is going to happen.” Casebourne continued that he is really excited about the potential of it all. Leanne Kemp’s huge success with Everledger echoed the positivity around the technology. She had a “racehorse ready to jump on the track” but held the company back as she was not convinced it was really ready to go as a technology. BlockChain, she said, was similar to RFID in the 90’s competing with bar-codes and rather than either becoming obsolete, needed to find their place in the market which we still see today with bar-codes still very much in use and RFID prominent in Oyster Cards and the like. With regards to BlockChain, the last 6 months have confirmed that there is going to be real

traction. MIT, Cisco, Intel and IBM are at the table. Larger companies are interested in the ledger technology. Google and Netflix both offer test cases in distributed ledger technology and we can look to learn from them to adopt it quickly inside the industry.

What is hot for 2016?

Richard Atkinson pointed that, on the Buy Side, managing costs and an increasing interest in Cloud Technology were en vogue. Technology that helps to do things “cheaper, easier and better” and platforms to provide economies of scale would dominate. Regulatory challenges would also be firmly in tech agendas with data also a problem that needed to be cured. Both would continue to be hot in the year ahead. Rob Casebourne confirmed that banks would continue to look for innovative companies that could provide partnerships to “do interesting things with.” Applying verification technology to algorithms and smart order routing was a current example. The bank was looking to FinTech to innovate and bring in skills by partnering with others. The conversation turned to the influence of innovation hubs and their importance of connecting FinTech companies with VCs and opportunities. With Everledger having grown through the Aviva Innovation Weekend and having been a part of the Barclays Accelerator, Leanne Kemp was well positioned to comment. She pointed at how hubs such as BBVA and Barclays can give startups the tools to commercialise their ideas. “Tech guys have ideas but find it difficult to commercialise. These accelerators help to give them the tools.” Regulation remained the threat to slow down integration with large companies and banks. As Casebourne said “there are enormous levels of diligence and paranoia. You can’t just give it a go.”




5 7

Leanne Kemp claimed that there is a “Global Warming in banking.” The “controlled evolution” had allowed P2P to happen but banks remain the “trusted authority.” With Google and Apple Pay circling and innovation in China, we should be aware as it is “too late when the glaciers are already melting.” The relationship of banks and “disruptors” is interesting. ROI is considered. Is it a threat to the business line and, if it is, how can we embrace them? In other instances it is a curiosity. Do they like the team and feel there is a talent alignment? Kemp said that “startups are scrappy so they can’t afford to make mistakes or there will be no rice in the bowl.” Startups can do it “30 times quicker and 10 times faster” and hence companies like Barclays want to embrace startups. Google has Google Ventures, BBVA has entered the VC world. There is an acceptance now that industry led startups can provide positive disruption. Companies like Everledger “accelerate the industry and solve problems. This is not disruption but making improvements.” The question was posed about whether the Government was doing enough. Leanne Kemp was “surprised by the appetite” from the UK Government and claimed that there was “a lot of talk and action” coming from them. It was claimed that Universities were struggling to provide the talent for the new technology. Rob Casebourne suggested that we should be slow to point the finger at government intervention here. In the US on the West Coast these kind of degree courses were established and quickly over-subscribed. It is a “self-correcting problem” and we have seen UCL already create Level 38 to help link to the Level 39 eco system and individuals see space and opportunity to create innovation labs to bring through talent. UCL, Oxford and Cambridge are adapting and the future looks promising. ■

" "

With approximations of investment in Fintech ranging from $4bn in 2013 to $20bn in 2015 the prospect of another bubble has long been on the horizon.

FinTech Predictions

The event concluded with the panellists being asked their one prediction for FinTech in 2016. They were as follows: Richard Atkinson: “It will be an interesting 3 months for Bitcoin. There is a cliff ahead that it will either pull over or have major problems ahead.” Rob Casebourne: “The use of Artificial Intelligence has a lot of legs.” Leanne Kemp: “Insurance Technology will overtake and eclipse some of the banks in terms of delivery. This is a really exciting area.”

Our thanks go to all of the speakers for their time and insight, to the full house of FinTech leaders who joined us and our fellow committee members from The Realization Group, Cake Solutions and Centre4Testing.


5 9

The definitive interview guide by Nadia Edwards-Dashti

PART

1

Approaching your interview

Interviews can be a stressful time and the fear is often perceived that the interview itself will be a one sided barrage of questions aimed directly at you, delving into all facets of your life. Granted, this type of interview can still happen however, it is very much a rarity as firms are now understanding the importance of a conversation skills and would rather a meeting of minds instead of the more traditional grilling. Gone are the days where a candidate should feel like asking, “Am I good enough for this company?” Instead, both candidate and company should feel are they ‘right’ for each other. As such, it’s so important that going into any type of interview you are prepared to put in time to researching and finding out everything about the opportunity in order to allow yourself to fully understand whether it’s the right one for you. Companies are well aware that the best people, those who are truly motivated, will want to know about the role, the company, the people they will be working with, the technologies, the career progression and most importantly what they will learn.

Comparatively, they are becoming more and more prepared themselves to have that type of conversation. If you are armed with great questions you are likely to get great answers and in the process elevate yourself above others. Preparation: Know the company, do your research, know what you need to know to make a decision, can you see yourself working there? What do you need to know to answer that question? Thought and Clarity: Do you know what you want to say and how you would like to project yourself? Have you thought about a project that best exhibits your skill set and will that allow you to ask about their projects? How will you clearly explain what you would like to do and what you would like learn within the business? What can you bring to the table? Motivation and Excitement: Are you excited about this interview? Why? What will motivate you to want to stand out? Will this interview opportunity motivate you more than others or your current role?

PART

2

The devil is in the detailthe technical competency interview

Being the best person for a job and getting selected for that job are unfortunately two every different things in this market place. Over the years firms, their HR teams and their hiring managers have built their own unique ways of trying to identify if someone can do the job, whether they are someone who they want to do the job and, if they can overcome those hurdles, does that person want the job and are they willing to commit to that long term. Sounds simple but in fact the reality is far more complex than it may first seem. One of the most recent phenomenon to affect even the most technical of hires has been the competency based interview. This style of interview has ended many an applicant’s chances of their dream job simply because they were blindsided with the type of questions, and moreover, questions that demand the need for recollecting a specific situation to showcase how you react to things. Competency questions allow the interviewer to assess how you have conducted yourself within a team or in a standalone individual speaking with other areas of the business. Culture and environment fit is becoming increasingly important within the technical interview especially in environments that promote positive challenge within the team to encourage constant growth and communication. The typical preparation for this type of interview is the STAR technique and please follow this link to what that entails and how the answers should be tailored around Situation, Task, Action and Result. A competency based interview will typically involve questions around specific examples where you have struggled with team members or a particular task and how that was resolved quickly and efficiently. Every time the choice of scenario and the details

that follow it determine how confident the interviewer is in your ability to get to a solution with minimal disruption to the team. Typical questions include:  Describe a time when you were a member of a team and witnessed a conflict within the team. What did you do? What were the results? What could you have done better?  Give an example of how you dealt with a difficult or sensitive situation that required extensive communication.  Give me an example of a problem you have faced in the past, either as part of a team or as an individual. How did you solve the problem? What many people fail to prepare themselves for is the thought process around how problems were solved and how the outcome was positive even if the particular scenario was negative. When answering these questions, you should consider the following: 1. Choose the best example for you, don’t pick an example that will be difficult for you to explain the scenario or, even worse, someone else’s example as you won’t be able to explain the thought processes you went through to solve the problem – “what a tangled web we weave, when first we set out to deceive!” 2. Make sure they are real and you have the detail behind the story 3. Know what you could have done in hindsight to get to a quicker or better solution 4. Practise telling the scenario to someone out loud (be sure to choose both a technical person and then someone non-technical to prepare for your varying audiences) 5. Think about how your audience or team around you perceived you through this situation – is that how you wish to portray yourself now? 6. Everything you say will paint a picture of you make sure you are truly happy with every detail ■

Parts 3 and 4 in the next Financial Technologist


6 1

INSIGH R R TS A T S

INSIGH R R TS A T S

What makes a good application support analyst?

Best place to work for a developer

Support of applications is critical for 75% of organisations, but over half are struggling to maintain and manage their portfolios.

In particular, FIX Protocol is continuing to grow as a requirement, with most Application Support Analysts having to have had at least some exposure to it. It has revolutionised the trading environment and has become the language of the global financial markets used by buy and sell-side firms to communicate trade information. Application Support Analysts will be expected to know or learn fix as part of their daily tasks will include FIX troubleshooting.

So, what makes a good Application Support Analyst? A common requirement for By Luigi Negri Application Support Analysts is that they need strong communication skills – but what exactly does that mean? Firstly, it is the ability to express yourself well, verbally, on paper or email. You also need an acute understanding of your role within the organisation. Other people within the business depend on your services and so you must know how to respond to that pressure and dependency.

For advice on how to make yourself a more attractive prospect in this volatile market, or for a discussion on where a career in Application Support can take you, get in touch on 0203 5877007 and ask for Luigi.

By Jon Kay

Working in financial technology I get to interact with lots of organisations and candidates. My aim is always to provide a world class service to both candidates and clients. On the client side we look for people who will add value to their company and on the candidate side we aim to deliver them the best opportunities for themselves for career satisfaction.

your way up the ranks of a company is ample motivation for a developer and the chance to impart your hard-earned knowledge onto a team is what drives these professionals into a new role. This sort of conversation is invaluable when it comes to planning your career and ensuring you’re in a role for the long-term. It helps partner to parties in a positive way. Financial technology is exciting and there are many different types of business with different selling points. If you are driven by business exposure and full stack development, Hedge funds and asset management firms could be for you. If you like coding to a spec, the vendor space could be for you. There are great options within this industry, which offer work as exciting as your Amazons and Googles so don’t look away from finance. With all companies ramping up their respective technology budgets and bringing talent in from Microsoft and Amazon, Finance could offer all the ingredients you need for a great career in software development.

Each developer I speak with is different although many seem to be driven to a limited number of factors; some are driven by using the latest technologies, others working on Greenfield projects, training, career progression or money. The beauty of working in this dynamic industry is that technology is at the heart of a financial company’s success. Technology is providing a competitive advantage for organisations, whether it be for low-latency trade systems, risk management systems or analytical platforms that can forecast the financial markets. With this in mind, it allows many options for software developer professionals that I work with.

Then it goes without saying that an Application Support Analyst will need to demonstrate IT literacy around applications and systems, you could be using either Windows or UNIX but databases skills (particularly SQL) are key. The ability to script has also become a common requirement as well as other manipulative abilities, with Python being the most sought after skill. There is a lot of movement within the vendor space with stellar companies such as EZE Software and Charles River always on the lookout for analytical driven individuals to support their clients and essentially represent their business. This makes communication and even customer service skills even more important in the vendor space.

A lot of companies have an incredibly detailed and diverse set of requirements so to find one person with all of the required skills is rare.

Due to a lack of stand-out talent within Application Support it is a very candidate driven market. A lot of companies have an incredibly detailed and diverse set of requirements so to find one person with all of the required skills is rare. This recent trend of having on person cover so much of the support environment has left a real talent shortage but also means that those who do have the skills can command higher salaries than their contemporaries of 5+ years’ ago.

What is an ideal best place to work for software developers? Greenfield projects – Although there is major risk involved and not all ends up being successfully deployed, the majority of developers are looking for end-end builds of software systems throughout all phases of the life-cycle. Learning – This is a keen factor for developers looking to move. People enjoy being challenged and the stimulation of learning new technologies, systems and business models is a major factor for finding a new role. Work-Life Balance – This may play a large part for software developers in changing roles. Although some companies offer rewarding bonus packages which require longer hours than the standard 9am-5pm. Career Progression – Achievements can be measured in different ways and sometimes, the opportunity to work

So what are these skills that are so highly sought after?


6 3

CLOUD FINANCIAL SERVICES

INSIGH R R TS A T S

• EUROPE’S LEADING CLOUD FORUM FOR THE FINANCIAL SECTOR • SAAS TRANSFORMATION DISCUSSIONS • ALL MAJOR EUROPEAN FI’S ATTENDING

24-25 MAY 2016 LONDON

USE THE CLOUD TO DRIVE DIGITAL TRANSFORMATION AND IMPROVE CUSTOMER INTERACTION

Top five skills in it change and professional services within finance In this era of business having knowledge is key to opening up new opportunities for you. IT Change & Professional Services roles within Financial Services often look for a specialism whether that be a specific OMS platform understanding, working approach or technical know-how. By Felix Here I look at the top 5 leading skills Symonds that are currently required in the market for roles within Finance in Change IT and Professional Services.

150 FREE PASSES FOR FINANCIAL INSTITUTIONS

this is a top skill to have on most system implementations 4. Prince 2 Foundation/Practitioner/PMI/PMP Are you a certified Project Manager? These courses don’t take a long time and chances are you have probably been working to the standard, however most employers want to be assured that you know exactly how to work to a specific standard

LAST FEW REMAINING VISIT THE WEBSITE TO RESERVE YOUR FREE PASS

5. Agile/Waterfall Methodologies All technology companies work to a process (methodology) when deploying a new phase of development and if you are either trained in Agile/Waterfall or have worked heavily in a house that works to both then you will be very much in need as a BA or PM. This kind of knowledge will be very specific to individual tech companies as neither is similar and each company have their own beliefs on how deployments should be carried out in the most effective way, finding the right balance and company to work with is key to the relationship working.

1.Front Office Trading Systems – Specific OMS platform knowledge Having clear understanding from both a technical and functional perspective is key if you are looking to get into the Buyside in a Business Analyst role, having system knowledge similar to Charles River Development, Fidessa and BlackRock from an upgrade or maintenance stand point is critical to certain Asset Managers and in a technology era being able upgrade to latest versions is paramount to organisations turning a profit.

Having a good understanding of what future clients or employers might need will help you get ahead of the game, now I’m not saying that in order to get ahead you need to know the above but what does help is finding a good match for both you and your future employer / client. If you understand what their need is then you can match your requirements.

2. FIX A Unified/Standardised language for Pre-Trade communications. This is used both by the BuySide and SellSide for front office trading and with the increased Regulatory requirements this is the perfect tool to gather and store information required when reporting. It is forever developing and they are hoping to expand into Post Trade services within the Back Office. If you have a clear understanding of how this operates and can develop then you will be an asset to a BuySide organisation in a Business Analyst role.

THOUGHT LEADERS INCLUDE:

YURI MISNIK GLOBAL HEAD OF DIGITAL IT AND ENGINEERING HSBC

DONYA ROSE CHIEF OPERATING OFFICER GLOBAL TRANSACTION BANK DEUTSCHE BANK

CHRISTIAN REBERNIK CTO NUMBER 26

IGNACIO BERNAL GLOBAL HEAD OF ARCHITECTURE & IT INNOVATION BBVA

FIND OUT HOW TO TAKE ADVANTAGE OF THE FULL CAPABILITIES OF CLOUD INCLUDING: • • • •

3. SQL When asked why do I require SQL in a PM or BA role which is very common, simply my clients have over the years been looking for candidates that can interrogate databases and have a good understanding of what is required from a system. By no means will you be required to be DBA level but

Harnessing the transformational potential of SaaS Managing disparate cloud applications to control shadow IT Reducing the length of product development cycles to improve competitiveness Use cloud computing to support low latency environments and increase trading profits

PARTNERS INCLUDE:

6 4

WWW.CLOUDFSEUROPE.COM

TIM HYNES, CIO ALLIED IRISH BANK

BREAKDOWN

THE 2016 SALES MARKET ith 2016 well under way, Harrington Starr look at the disparities and similarities between the Sales markets in the UK and US and the average experience required to be considered for each role in “The Breakdown,” our series into disciplines across financial technology.

professionals. This is also the stage where top end sales executives can have one eye on management or look to continue up the ladder towards Senior Sales Executive and the sort of money that attracts people to the sales market in the first place.

W

The US market shows a similar path and, due to the plethora of start-ups and FinTech disruptors, provides an exciting prospect for those who feel the grass is greener across the pond. After something of an exodus of home-grown talent in recent years, doors have been left ajar for bright and exuberant junior sales to play whilst the more experienced cats play overseas and it is resulting in a real fascinating variety to the space.

The Sales market is diverse and demanding but the well-publicised rewards are there to be obtained by those who display the warranted skills and persistence. The beauty of the industry is that there are any number of roles that can provide you with the experience required to get your foot on the ladder towards the more lucrative positions of seniority. Notwithstanding technical professionals who will forever be tempted with the glamorous move across to Pre-Sales, opportunity for less experienced professionals to join in is rife.

s o f t w a r e Junior Sales Graduate sales – £25 - £28k

Sales executive (2-5 years)

–

–

SALARY

SALARY

£28 - £35k

£40 - £70k

OTE

OTE

£35 - £45k

£80 - £120k

50% of companies offer a car allowance @ c£5k/year

Graduate Sales

Those initial 2+ years’ should provide a good indication as to whether Sales is going to be a feasible career and it is this point where commission structures begin to reflect ability. OTE’s tend to reflect a base level of business generation and so can be well-exceeded by diligent and hard-working

(0 – 2 years)

(1 – 3 years)

–

–

–

SALARY

SALARY

$45 - $55k

$58 - $75k

OTE

$63 - $85k

OTE

$75 - $115k

SALARY

(6-15 years)

– £80 - £120k OTE

Sales Director (management) (15+ years)

– SALARY

£130 - £150k OTE

£180 – £250k

£200 - £300K

Senior Sales

Sales Manager

s a l e s Junior Sales

(2-6 years’ experience)

–

(10 years’ experience)

– SALARY

Managed a team of 10 persons, revenue £40m approx.

–

SALARY

£75 - £90k

OTE

£130 - £180k (uncapped)

£150 - £180k

Senior Sales Exec

Sales Manager

Head of Sales

–

–

£40 - £60k

£60 - £80k + Bonus

Sales Exec

SALARY

£100 - £130k

SALARY

Junior Sales

Sales Manager

OTE

Pre Sales –

u s

Pre-sales – £70 - £90k

n e t w o r k

The moral of the story tends to lend itself to hard-work and immersion in what it is being sold. There is a pot of gold at the end of this FinTech rainbow that will rival most C Level salaries but the route there is rarely smooth sailing. For those passionate about what they are involved in, share options and management of up and coming sales gurus provide ample motivation. Talent is a commodity not lightly sniffed at within the space, however, so if the rewards aren’t there, there will be plenty of potential suitors ready and willing to offer a route out.

Junior Sales positions can be obtained with as little as 6 months’ experience and, whilst the basic will reflect this lack of experience, there is usually a clearly defined path to more senior positions. Graduate schemes will allow you to go straight into a company upon completion of a degree and will provide insight into the product from scratch however, some managers prefer applicants who have the experience of talking directly to clients, managing processes and dealing with objections which can be gained through telesales positions in any industry.

(6-18 months experience)

s a l e s

£70-100k

OTE

SALARY

£90-110k OTE

s a l e s

(3 – 6 years)

(6 – 9 years)

SALARY

$80 - $100k OTE

SALARY

SALARY

$100 - $120k

$110 - $150k

OTE

$160 - $200k

(9 – 12 years)

$200 - $240k

OTE

$220 - $300k

(12 – 17 years)

– SALARY

$150 - $200k OTE

$300 - $400k


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2016 CONTRACT RATES

Buy side average £488 - £623 per day Vendor/Start-up average £404 - £536 per day

LONDON FINTECH MARKET arrington Starr has put together the latest in a series of infographics highlighting the average rates contractors can expect in the 4 main verticals within the financial technology industry. There is, of course, a disparity between the Buy and Sell sides, the Energy Trading space and Vendor and start up environments which comes as no surprise. The Sell Side continues to be the highest payers and throw their financial weight around in a bid to obtain the best talent. However, whilst the money may be with the Sell Side, they come with a lot of pressure to perform and a high expectation to be an expert in a fairly narrow field.

Boom” which is offering up some fascinating projects for people to get stuck into, getting them off the ground. With the huge swathes of new companies springing up offering new ways to invest, save, or use your money and existing software companies having to react to keep up there is ample opportunity for those with the know-how to step in for short to medium length contracts and do the same job across a number of companies.

H

Whilst the Oil and Gas industry has taken a well-publicised hit in recent times, there is still ample opportunity out there for specialists within the Energy Trading community with knowledge of the space, especially within the Change disciplines, to make good money with the various regulatory changes imminent.

This is why a lot of contractors, especially early on in their careers, are choosing the Buy Side. Whilst the rates may be lower, the range of work is broader with generally larger teams and support structures in place. This allows for greater personal development opportunities and, more often than not, paves the way towards the more lucrative contracts further down the line.

Overall, the sun is shining on the contract market and 2016 is making good on what was a promising end to 2015. Emphasis remains on project experience within the Development space, whilst infrastructure candidates should look to boost their experiences with Risk, Compliance and Security skills to make them un-passable to hiring managers. For Interim Change professionals, ThinkFolio and Charles River remain the stand-out skills and the time is now for Rick, Regulation and Compliance as companies look to make double sure before

Contrary to popular belief, the contract market is not all about the money and this is reflected in the popularity of the Vendor and Start-Up space. This market is seeing resurgence along with the recent “FinTech

Sell side average £546 - £742 per day

energy trading average £503 - £667 per day

BUY SIDE

SELL SIDE

VENDORS/ START-UPS

ENERGY TRADING

C#.NET

£500 - £700

£550 - £800

£400 - £500

£550 - £700

C++/Java

£500 - £550

£550 - £900

£400 - £500

£550 - £700

Front End Technologies

£550 - £600

£500 - £750

£350 - £450

£450 - £650

Testing

£450 - £550

£550 - £750

£350 - £500

£500 - £650

App Support

£450 - £650

£400 - £500

£400 - £500

£350 - £500

FIX Consultant

£450 - £550

£500 - £650

£450 - £600

£450 - £550

Infrastructure

£350 - £500

Specialism dependant

£250 - £400

£400 - £500

Networking

£400 - £550

£500 - £600

£250 - £400

£400 - £500

Security

£450 - £600

£500 - £700

£400 - £550

£550 - £650

PM

£550 - £700

£600 - £800

£450 - £600

£600 - £700

BA

£550 - £700

£500 - £700

£400 - £500

£500 - £850

Senior Programme Managers

£600 - £800 £750 - £1,000 £550 - £750

£700 - £900

Risk Consultant

£550 - £650

£600 - £800

£500 – £600

£550 – £750

Commodity BAs

•

£600 - £700

£500 - £650

£500 - £800

Development

support

change

6 8

6 9

BREAKDOWN

INFRASTRUCTURE AND NETWORKING SALARY TRENDS 2016 he next in Harrington Starr’s series of Salary Surveys looks at the Infrastructure and Networking verticals and highlights some interesting differences between disciplines.

architecture. Security is also now finding itself embedded in the Networking side of the technical playing field which seems to be emerging as an alternative career path for some more junior engineers. At the lower end of the scale, it is rare to find a pure networking role any more with most companies opting to bring in less experienced engineers with all-round experience of server support, maybe a CCNA and some desktop experience in an all-encompassing position and so, again, the emphasis is on broad skills rather than particular expertise in any one field, hence the wide range of career paths open to infrastructure/networking professionals of the modern age.

T

The first thing to note is that the survey is a guideline and far from exhaustive. In fact, were it to include all the roles covered by that section of the business, there would be little room to include salaries, such is the variety and complexity of some of the requirements in that field over the last 12 – 18 months. What is interesting is that the sway is still towards Linux as a skill, regardless of the fact that, in the US at least, 7 of every 10 desktops still use Windows. A lot of companies are looking to Linux because of the cost-effectiveness of having an open source platform and some of the money they are saving is going into hiring the right people with Linux professionals garnering an average of £5k more than their Microsoft counterparts. The real stand-out people here will be those who have a firm understanding of both Windows and Linux, a trend we will see more of later in the piece.

If there is one area which is becoming more silo’d, it is the Cloud. Having taken an age to be accepted by the masses, it is now here and demand is high. Such is its importance that hiring managers are realising it requires dedicated engineers to support it and Architects are garnering top dollar to design and implement. DevOps is another area that has a variety of paths leading to it and, now that is more understood about the position there are more opportunities to get in at a more junior level, whether it be through a sys-admin route, app support, development or even networking there are opportunities to learn whilst still earning circa £45k.

Network Engineers’ stock continues to rise, perhaps nowhere more than in the senior roles, before moving into architecture. Wizened engineers who have seen it all, developed the skills to do low level architecture but are still capable of getting their hands dirty can garner as much as £80k + benefits with a short skip and a jump towards management or design and

For more detail, call any one of our consultants for a discussion on the market and other options tailored to your skillset.

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Windows Cloud

Cloud Engineer £65k Cloud Architect £75k - £90k

1st Line up to £30k 2nd Line £35k 2nd/3rd £45k System Engineer £50k - £60k Service Desk Manager up to £50k Desktop Support Manager up to £60k Infrastructure Manager £80k - £100k

Network Engineer Junior up to £40k Middle £50k - £60k Senior £65k - £80k Manager £85k - £90k

Security DevOps

Junior £45k Mid £60k Senior £70k - £90k

Junior £45k Mid 60k Senior up to £85k Info Sec Manager £85k - £100k

Linux

1st Line £35k 2nd Line £40k - £45k Systems Engineer/Systems Admin £55k - £65k Senior Sys Admin £80k - £90k

GREAT PEOPLE FOR GREAT BUSINESSES WWW.HARRINGTONSTARR.COM Global Leaders in Financial Services and Commodities Technology Recruitment, Events, G L O B A L L E A D E R S I N F I N A N C I A L S E R V I C E S Insight A N D C O Mand M O D I Consultancy TIES TECHNOLOGY RECRUITMENT 7 1

FI L E A D E R S S U M M I T

The Breakdown

Change and professional services 2016 salary survey BUY SIDE/ COMMODITIES HOUSE

VENDOR

CONSULTANCY

EXCHANGE/ BROKERAGE

SELL SIDE

Junior

£40k - £50k

£40k - £50

•

•

£50k - £65k

Mid

£50k - £75k

£50k - £70

£60k - £75k

£55k - £65k

£65k - £85k

Senior/Lead

75k - £95k

£70k - £85

£75k - £90k

£65k - £80k

£85k - £95k

£100k+

•

•

£80k+

£95k+

15%

10-30%

10-20%

10-25%

10-50%

BUY SIDE/ COMMODITIES HOUSE

VENDOR

CONSULTANCY

EXCHANGE/ BROKERAGE

SELL SIDE

Junior

£55k - £65k

£45k - £55k

•

•

•

Mid

£65k - £75k

£55k - £70k

£60-k - £70k

£65k - £85k

£60k - £80k

Senior

£75k - £100k

£70k - £100k

£70k - £100k

£85k - £95k

£80k - £100k

Head

£100k+

•

•

•

£120k+

£80k - £120k

£90k+

£110k+

£100k+

£120k+

15%

10-30%

10-20%

10-25%

10-50%

Westin Copley Place, Boston MA June 07 - 09, 2016

business analyst

Head

Bonus

Bringing Together The Most Inﬂuential Buy Side Heads Of Trading For Credit and Rates

Project manager

Programme Manager

Bonus

VENDOR

VENDOR implementation Consultant

product manager Mid

£65k - £80k

Junior

£40k - £55k

Senior

£80k - £100k

Mid

£55k - £65k £65k - £90k

Senior Strategic Product Manager/owner

£100k+

Senior/Lead/Manager

Bonus

10-30%

Bonus

10-30%

Book Now To Secure Your Place For 2016 and save 15% VENDOR

VENDOR

Business Area Product Manager Senior

Simply quote “HARRINGTON15” when booking online! www.ﬁxedincomeus.wbresearch.com

professional services £100k - £120k

Senior Strategic Product Manager/owner

£120k+

Bonus

10-30%

Head

Bonus

7 2

£120k - £170k 10-30%

Sponsors:

+

Harrington Starr sales conference April 19, 2016

Essentially, he boiled it down to the fact that “we are all money-grabbing people, or have been to get to this point” One of the main reasons to get into sales is the amount of money available. So why do Sales people join a company? One manager found it boils down to a small number of reasons: 1) that opportunity to earn big. 2) The opportunity to gain a sense of fulfilment or achievement. It’s not about what you can buy with the money but using it as a metric for success. 3) The chemistry with the boss and 4) the global brand. So why do they leave? Well usually it is because of a lack or a loss of one of the 4 points aforementioned which leads to breakdown of trust. There is a common statistic banded about that suggests 70% of sales people leave a role because of their boss. This was hotly debated and decided to be largely true and that a boss would be a factor in someone wanting to leave and in more cases than not, this would be the direct result or symptom of the issue at hand. Mostly, there seems to be a breakdown somewhere else along the line which then leads to a breakdown in the relationship and the trust therein. 

+

By Scott Richardson

The topic up for discussion is how best to retain sales talent without just throwing money at them and our host kicked us off by highlighting the perspective with which to view the discussion. This was not going to be a list of secret tips that will revolutionise the way we all run sales teams, it is not that simple unfortunately. He drew reference to Andrew’s article on Warren Buffett’s 5 principles and suggested that if you applied that, you wouldn’t be going too far wrong in so far as the methodologies and principles that apply to this issue.




7 5

days ‘banging the phones’ and ‘pounding the pavement’. That’s not to say that phone times and meetings booked are necessarily the indicators of success. Times have changed and rather than the influential advice giver of the 80’s and early 90’s, consumers are now well-researched and knowledgeable about their respective markets and so the role of sales is now more around personal branding. KPIs, especially for new joiners, should be geared around networking, writing blogs, producing content and shaping themselves to be successful for the long run. Each member of the team, when they walk through the door for the first time, should be aware of what will be expected from them after 6 months, 12 months, 2 years and what the plan is to get them to hit and exceed those expectations and the full development lifecycle before they become genuinely valuable assets to the team.

Another large factor in moving on is technology. If a Sales consultant cannot see that their company is in a growth market, it prompts them to move to software sales or network sales, wherever they see the market moving. The mentality seems to be: “The world is changing and we aren’t keeping up so I’m going to make the move myself.” An argument was put forward that it seems to be a matter of Science vs Art. If Science is the figures and the compensation scheme which can become very complicated, then Art would be the relationship built with the manager and company, the brand and so on. Also, how to make sure you have good sales people that you want to retain in the first place. Some good sales people may not have been realised that they were good sales people at the time. Environments are created in which a bad salesman can be created but who in another environment could have flourished and been very good.

“The most effective brand awareness is when a sales consultant is sitting in front of someone”

“If you want someone to sell ice cubes but you give them the Antarctic as a territory, they’re not going to sell jack!”

Processing a performance management scheme and incentivising that and ensuring they value the less obvious aspects of selling are key to ensuring you are left with a good sales team.

Responsibility lies with the company/management to give junior sales guys big accounts to see if they can be successful instead of the companies your top guys wouldn’t touch, that way you can see how they perform on the big stage.

This understanding of what is expected should be something each member of the team is proud of and if a member doesn’t take pride in what they do or how they perform, it is normally an indicator of a lack of understanding of the profession. This can be seen on 2 levels: personal commission and corporate pride.

On the flip side, there is opportunity in the accounts that have been left alone due to difficult previous relationships and the like because the only way is up! Given time, you can turn a poor account into top earners. The emphasis still lies with management to allow time to turn the account around but the long term gains are two-fold with the account itself but also the lessons learned by the junior salesman.

“Commission is paid when the sale goes through, but actually you have to incentivise the whole sales funnel”

It highlights the important of individual motivation and how sales consultants should be compensated. One of the issues is that Britain trend leans towards high basics and so salesmen do not need to sell. There are exceptions to the rule of course, who offer lower basics but uncapped commission but even here, it is important to ensure that they have the opportunity to make the most of that by giving them the right territories to work. With higher basic salaries, the general consensus was that, rather than unrealistic 1st and 2nd year sales targets with the scenarios already mentioned, non-sales related KPI’s are a better way of incentivising junior members of the team. The KPIs themselves should be geared around learning their market, getting in front of clients and learning the expectations of what a member of the sales team should be doing.

It’s also possible for a good manager to create a successful team out of perceived “no-hopers” using this pride and selfbelief. An example was given of a manager who continuously reinforced a mish-mash team of ex-telesales, traders and retail sales people, seen by the rest of the sales department as out of their depth. He told them that they would be successful and the work they were doing was good and results would come and it was the self-belief, team ethos and self-fulfilling prophecy that resulted in a top performing team at the end of the year. An interesting theory was that a lot of sales teams were being measured on the wrong thing. The Einstein quote on judging a fish by his ability to climb a tree sprung to mind.

There is a “hard knocks” aspect that older generations of sales professionals went through, pre-internet days which younger generations don’t seem to understand on the whole which was a bone of contention for many. A hand-out mentality in which junior sales consultants join and expect leads and new business to be handed down to them as a divine right sticks in the craw of many a seasoned manager who spent their early

This was followed by a statistic that if a person was not positively reinforced verbally at least once a week, they will become disengaged but it also highlighted the necessity for salesmen to take responsibility and not blame poor results on the team or technology. The discussion moved onto recruitment and how to combat

importance of building a relationship between team members and management which begins at interview stage.

with the unavoidable fact that there is a shortage in top sales talent and good sales managers since the recession hit. Some attributed this to unrealistic expectations from C level and compared the role of Sales Manager to that of Premier League football. Part of securing the job in the first place is convincing the board that you can turn a flailing team’s fortunes around however, not many are willing to allow the time required to build a team from scratch and require immediate results so there becomes a turnstile scenario of managers and team members coming and going amid poor results in the short term.

Career development and progression has long been a carrot used to entice longevity in employees but in sales it seems to be heading down a slightly alternative route. Mentorship plays a huge role in the progression and development of a salesman, and the days of spending 25, 30 years plus with the same company are, sadly, a thing of the past. The best companies are the ones who are reinventing the role or the requirement at least, consistently every 2 or 3 years to aid the development of the individual but also provide the variety required to retain buy-in and engagement. In cases where that just isn’t possible, the better managers seem to realise that, in the interest of development, some salesmen are better served moving onto another company. This may seem like a case of cutting ones nose off, however, it allows time to replace the person leaving whilst avoiding the shock of someone leaving out of the blue and also opens the door for that person to return further down the line in a position of seniority having gained experience elsewhere and perhaps jumping the hurdle that was preventing them from progressing in the first place. It is cases like these that see managers hiring the same people multiple times, often for various companies as the respective managers’ move on themselves, as a result of the trust and bond formed through mentorships.

One suggestion was for targets to be brought down to a more reasonable and achievable level according to the market at the time and allow sales teams the moral boost of hitting targets. However, offering stretch targets will often lead to teams over-achieving and therefore increase the short term earnings and increasing the boost in self-belief if they do manage to hit the target. It seemed to boil down to the manager taking

"Everybody is a genius. But if you judge a fish by its ability to climb a tree, it will live its whole life believing that it is stupid."

What is also evident is that the speed of change is much faster than ever before in that lives can change inexorably in the space of a year or 2 unlike previous generations, and companies now need to reflect that and cater for someone whose motivations change from a party lifestyle to a more settled one, for example.

Albert Einstein

The stigma attached to sales positions among society is one of irreverence and this is contributing to the lack of top talent. In the boom years of the 70’s and 80’s, university degree were considered elitist so for those incapable of attaining a degree, they applied their hard work and drive towards sales. People would sign up, making a conscious decision to take a basic salary usually at half of the national average wage knowing that they would give their all and work as hard as they could to make sure they could earn a good deal of money knowing that they would get out what they put in. Now, in the social media age, people are bombarded with advertising offering huge OTEs and glamorous lifestyles in an effort to overlook the stigma and brushing over the grit, determination and drive required to succeed and so inexperienced juniors are going into jobs on a huge basic with a delusional view of what’s required of them.

responsibility for managing expectations from above, whilst offering as much support, encouragement and reassurance to those below. Another key factor to consider is the length of sales cycles and how they affect budgeting and targets with many in the room attesting to have dealt with sales cycles in excess of 12 months and therein butchering any hopes of an annual target and brought the discussion back to motivations of the individual. On a motivational level, every individual will be motivated in either a “Food” or “Play” basis according to their lifestyle, age, family situations and so on, so the incentives have to be adjusted accordingly as people join the business. If a company has a “one size fits all” approach to motivators, it is all but guaranteed to lead to constant turnover in staff.

Where there is some movement is the other stigma that sales is strictly a men’s environment as more and more companies have more female presence in the sales room and seeing huge gains as a result.

A consistent hurdle when bringing in staff emerged in external members of the business getting involved. Company induced barriers such as university degrees get in the way of genuine sales experience and it was widely agreed that a good education did not equal sales ability.

The final thought was a summary and whilst it was widely agreed that this group of elite senior sales managers and directors had barely scratched the surface of the topic of staff retention, one seemed to sum it up nicely:

“[There are] not many more important hires in a company than sales. Don’t let [anyone] get in the way!” It is so important that hires are not delegated, going back to the original point of the

“If you can get the right people and get them in the door the right way, half the battle is behind you.” Onboarding is key to retention. ■


7 7

W W W . H A R R I N G T O N S T A R R . C O M

T: +1 646 381 2067 E: [email protected]

HARRINGTON STARR US IS HERE! E

xciting times at Harrington Starr as we see the launch of their US office, the first foray of feet on the ground outside of Europe and leading the way are Rob Grant and Sarah Philby.

Focussing on Sales, Rob and Sarah have launched with no little experience behind them amassing an impressive 20 years’ recruitment experience across a range of environments. It also marks an impressive coup for the Harrington Starr group after a successful move into the heart of the City of London and continued success across the financial

technology market in the UK and Europe.

the natural next step for us with Wall Street having long represented the heart of the global financial district and strong relationships with many of the European arms of current US clients. We look forward to this marking the first step in our international strategy that will see further growth in other US Cities as well as European and Asian expansion.”

Company CEO, Toby Babb, had this to say: “This is a great opportunity for us to take our old fashioned values and successful recruitment model and apply it to another huge, but very different market. New York is

Rob joined Harrington Starr having seen plenty of success prior, running his own recruitment agency, before seeking opportunities State-side. Sarah was born in the Deep South and grasped at the chance to return to the country of her birth having

Sarah Philby, left, and Rob Grant

7 8

worked across Support and Sales teams at Harrington Starr, working her way up to Managing Consultant in her time with the company.

Babb continued “The move has been driven by continued customer demand from our international client base. We are delighted to now be in a strong position to service our US clients in the same way as those here in London. We have a superb team and are looking forward to growing with similar thinkers in the months ahead. ■ If you are interested to find out more about the Harrington Starr US business, please get in touch with Rob or Sarah.

LOVE, LIFE AND WORK – FINTECH ADOPTION IN THE USA 2016 has continued to see FinTech adoption increasing significantly across the banking and trading sectors. A recent report from EY has predicted that this level could as much as double over the course of the year meaning that companies are reconsidering their product deployment and are looking to both refresh legacy systems and adopt more disruptive technologies in a bid to gain market share. The USA remains one of the most active markets in adopting FinTech across a plethora of its banking functions both on its investment and retail arms. This race to the top has seen many European companies endeavour to cross the pond and showcase their products and services to a hungry, and eager-to-buy audience. For those that get it right the rewards are huge. Europe and particularly the UK are seen as being one of the key “centres of excellence” for FinTech developments and the potential for transatlantic growth remains incredibly alluring. However, it’s not a step to be taken lightly and shortterms wins are few and far between. With an average sales-cycle lasting anything from 6 to 18 months any company looking to “break America” has its work cut out for them. A clearly defined value proposition coupled with a strategic and long-term approach is absolutely essential. Many companies have tried and failed despite developing some truly innovative and disruptive technologies. Technology in itself is not enough. To horribly paraphrase the words of New York playwright Elbert Hubbard “the cemeteries are full of ‘indispensable technology’”.

Additionally there’s the rather important matter that no-one spends more on FinTech development investment than America itself meaning there is no small amount of domestic competition to be considered. This results in the need for a full competitor analysis and thorough research before any growth plans can be even developed. Top sales people with a proven track record and an extensive network of contacts are a highly sought-after resource and can quite often be the difference between success and failure. The traditional strengths of some FinTech start-ups; innovation, technology, the desire to disrupt are insufficient for the product to get traction and that is where and experienced sales, marketing and product team come into their own. No matter how good the product, unless it’s relevant to the needs of the customers – it won’t work. No matter how innovative the solution, unless it’s being sold and marketed correctly, effectively and almost most importantly relentlessly – it won’t work.

"THE USA REMAINS ONE OF THE MOST ACTIVE MARKETS IN ADOPTING FINTECH ACROSS A PLETHORA OF ITS BANKING FUNCTIONS BOTH ON ITS INVESTMENT AND RETAIL ARMS."

With all the money being spent on developing the technology itself it’s worth remembering that securing top talent must be given equal importance and resources. As with any company it’s the people that are the most valuable asset and recruiting the top talent is an essential part in any international expansion plans. To those that get it right the rewards are huge and as the saying goes if you can make it here you can make it anywhere but breaking America isn’t easy…unless of course you’re One Direction! ■ 7 9

EDITORIAL TEAM C

Alex Odwell

O

Nadia EdwardsDashti

Lee Harding

N

T

R

James Hounslow

Claudine Eastwood

I

B

U

Hari Sopal

Antonio Ciarlegio

T

O

Elliot Parfitt

Andrew Thomas

R

S

Richard Twumasi

Scott Childs

Tom Kemp

Scott Richardson

About Harrington Starr Imagine if you had a Recruitment partner whose purpose was to help you grow.

James Platt

Jordan Betts

Charlie Emery

Graham Hill

Felix Symonds

Andrew Watson

Robyn Harper

Imagine if you had a Recruitment partner that believed better people made by better clients, better candidates and better people. Imagine if you had a Recruitment partner that cared as much about putting the right people into the right businesses, as they did about investing back into the community they belonged.

Jonny Kay

Lewis Bickerton

Ian Bailey

Sarah Philby

Harriet Lamplugh de Smith

Michael Paterson

For more information, please contact: Toby Babb at Harrington Starr

You can! Harrington Starr. Your Success, Our Business.

Adam Williams

Lee Farthing

Ryan Waters

Toby Babb Editor

Luigi Negri

Stephen Quinn

Rob Grant

In 2010 we launched Harrington Starr and over the past five years we have become the Global Leaders in Financial Services and Commodities Technology recruitment, insight, events & consultancy. Delivering high quality opportunities for professionals on a permanent, retained, contract, and interim basis, to over 500 partners within the sector.

Dan Biddulph Art Director 8 0

8 1

T: 0203 002 2850 F: 0207 022 1750 E: [email protected] Harrington Starr Company Registration Number: 7246003 Company Headquarters: Vintners Place, 68 Upper Thames Street, London EC4V 3BJ Company Telephone Number: 0203 587 7007 Company Email: [email protected]

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