The single most motivating factor for me is that I have a job," exclaims one senior technology architect with a Boston-based custodian bank, who declined to be named. "That's what motivates most of the people I work with right now. We're happy to have jobs and we want to keep them."
In a tough market, where pay freezes have been in effect for up to two years, technology budgets have been cut to the core, and comrades have been laid off, what's a CIO to do? How does he or she keep staff motivated and productive during a market slump? And, more importantly, how does he or she ensure that productivity is at a level that prepares the firm for a possible rebound of the financial markets?
Though the pressure to keep a job in this market may seem to be motivating enough, that's not what Wall Street & Technology found in a recent survey of salaries and attitudes of senior-level business and technology executives at buy-side and sell-side firms. The survey found that close to 50 percent of respondents feel underpaid. And, if the top-motivating factor for any employee is money, that puts technology managers at a major disadvantage.
"Money is the number one way, by far, to keep someone on board," says Alan Geller, managing director of AG Barrington, a financial-technology career-management firm. "I wish I could tell you that things like offering education or time off are things that would really motivate people, but I would say for the real, true, career professional, it doesn't matter. It's not going to hold them. What does matter to them is the monetary commitment and the challenge of the job."
Jory Marino, managing partner, Global CIO Practice, Heidrick & Struggles, a New York City-based executive-search firm, agrees that money and job challenge are the top motivators. "The value proposition of coming to Wall Street is that you will be working on ground-breaking initiatives, and you will be paid way more than anywhere else."
That said, however, he believes the job challenge is a more significant motivating factor than money. The way he sees it, "The novocaine of your paycheck wears off quickly if you don't enjoy what you do."
With salary hikes out of the question and budget cuts affecting the number of cutting-edge projects available to technologists, it would seem that managers have no hope.
However, financial-services firms are trying their hand at motivating staff in alternative ways, and it's working at some firms.
It's not Where you work but Who you Work With
A senior technology executive at a small investment bank, who declined to be named, reminisces, "There was a time when the more bells and whistles you had, that was what really motivated people." However, she adds that although her firm has had a salary freeze for two years, the bank only lost 10 of its 560 technology employees last year.
She says people stay and are productive because management makes it a "nice place to work," and the technology staff enjoys the people they work with. It might sound like fluff, but she says the company spends a lot of time on "team building" and offering flexible schedules. "We don't have a utopian environment, I won't even try to claim that, but we've been able to maintain our tech folks," she says.
Her staff's motivations aren't surprising, as many financial-technology executives say the third largest motivator is "the people you work with and for."
Personal Development is a Plus
The same small investment bank also tries to promote from within and move people around internally, so they can work on different projects. Training is offered to help them prepare for these new roles and projects.
Another aspect that has helped keep tech staff motivated is the bank's commitment to bringing the technology staff closer to the customer. Having the technologists well trained in business issues and more in tune with the overall goals of the company makes them feel included in the company's overall mission, she says. In other words, it motivates.
Geller says this is done far too infrequently on Wall Street. He says most financial-services firms couldn't be bothered to train their technology staff in the ways of business. "There have been individuals on the technology side that have wanted to get this kind of training, and what they are being told is,'We get the best trained MBAs in the world to work for our firm, why in tarnation do we need to train you on the business side?'" he notes.
That said, he acknowledges that a few firms have indeed invested in training their people. "Morgan Stanley is one. And Morgan Stanley does retain its people."
There are other types of training that are being done today as well. Marino says, "Many firms are using the 'non-investment period' to raise skill levels of teams and to prepare them for future jobs."
Some firms are offering their more senior-level technology people an opportunity to further their education. Whether it be through an executive MBA program or another type of continuing education, it is something that makes an employee feel like they are getting something from the company, agrees the senior tech architect from the Boston-based custodian bank.
"My company is big-time high on education. We can take classes anytime, for as long as we'd like. In an atmosphere where we have a salary freeze and no bonuses, some people feel satisfied that they are getting money in another area while boosting their skill set," he says. "I'm getting my MBA."
Along the vein of skill-set improvement to further motivate staff, Barclays Capital has instituted a professional-development program. "More than ever, it is important for staff to have clear goals," notes Kevin O'Reilly, head of IT and Strategic Planning, Barclays Capital. He explains that it creates a framework of competency for each employee. O'Reilly is in the process of rolling out this "competency framework" to his 1,200 person tech staff.
The plan includes a Web-based system that helps employees and their managers keep tabs on their progress. "The idea is to manage by objective and to identify a direction for the employee in terms of the overall business, as well as determine the next appropriate project for them," O'Reilly says.
PJ Di Giammarino, chief operating officer of IT, who works closely with O'Reilly, adds, "We've always done a good job of doing management appraisals. We've put a lot to time and money into personal development this year, and we expect that it will pay off." Barclays is also investing in skills training.
O'Reilly and Di Giammarino say the professional-development program is motivating because it creates an environment where there is clear communication between the managers and the workforce, and it puts people in control of their career development. O'Reilly says, "It's been well received. We're a young organization. People are up for it. They're positive."
From Vacation Time to Bonus Time
How else are people motivated? Options that vest are always a good way to keep an employee, says Geller. He also suggests that a one-time-event bonus is also a good carrot. If a firm is going through a merger or acquisition, offering a bonus at the end of the integration project is another good way to keep employees focused.
Geller points out that there are certain things that can be done to motivate select individuals. For example, some financial-services firms are offering select individuals small bonuses by taking them aside and telling them that no one else is getting a bonus. "Even if it is just a token, this can make a difference, especially for the developer type of employee," Geller says. Also, for a programmer from India or Europe, H1 and F1 visas provide incentives to keep working hard, he says.
Another suggestion for motivating a staff member, who a manager cannot offer more money, is to offer to pay him or her as a consultant, suggests Geller. He says he worked with a hedge fund CIO who liked being paid in this manner, because he received more money. In this type of scenario, the person would have to take care of their own benefits, but pay would be higher.
Geller also points out that, "Although firms are crying poverty - If a key person decides to leave, they suddenly start loosening their purse strings by offering $10,000 to $15,000 for an employee to stay." He has seen up to a $50,000 counteroffer.
Equally as important as feeling challenged is the feeling that technology is valued at a firm. Ensuring that the CIO sits on the executive board sends this signal to the technology department, notes Geller.
Who's Doing It Best & How?
Firms that are said to be doing a better job of motivating staff include: American Express, JPMorgan Chase, Goldman Sachs, Morgan Stanley, Deutsche Bank, Putnam, Fidelity and Bank of America. The reasons? "They have hired great people. They're well run organizations. They invest in their people. They have good leadership and they pay well enough. Put all of these elements together, and you have a motivating place to work," notes one source who asked to remain anonymous.
But, there's only so much employers can do to motivate their staff. Most of the motivation has to come from within, says one technologist. This is a time for the technology employees to differentiate themselves and prepare for a shift that is occurring within the organization, industry executives say. Outsourcing, for example, is one of the biggest de-motivators as it can be job threatening to the IT staff. However, "People should look at it and say, 'What can I do to fit into the new IT order?'" notes the technology analyst from the Boston-based custodian bank.
He suggests that IT professionals identify opportunities. An example? He explains that the legal department and procurement departments at financial-services firms will grow in importance as outsourcing increases. This is an opportunity for some technologists to get involved in building the new process.
Words to Live By
All in all, finding that delicate balance of cutting costs and maintaining productivity is difficult. Some say that downsizing can have a positive effect on staff as, "It is an opportunity to get rid of dead weight." In addition, it enables those left to get their hands on a variety of projects, which can be motivating.
However, Marino suggests that financial-services firms beware of cutting too much and should make sure they don't forget the value of their people. "Continue to invest in people and build skills in those individuals," he says. Most importantly, "Be mindful that as you downsize the organization, there is a point at which you can become at risk. You have to know when to stop downsizing, so you're not creating gaps for future leaders of the organization."
The bottom line, he says, "Financial-services firms need to continue to motivate their staffs and invest in their skill development in order to be prepared for future growth."
Are You Underpaid? Survey Says ...
Below are the results of a recent Salary and Attitude Survey conducted by Wall Street & Technology. The questionnaire went out to all WS&T readers for whom we had e-mail addresses. Results were received from over 400 management-level technology and business employees working at broker/dealer and asset-management firms. Here's what they said:
LARGEST MOTIVATING FACTORS