“Career Insights: Platformization of Financial Services and the Future of Careers in the Investment Industry”

Speaker: Ujjwal Jain, CFA, Founder & CEO, WealthDesk
Moderator: Biharilal Deora, CFA, Director, Abakkus Asset Manager LLP
Contributed By: Sumit Duseja, CFA, Co-Founder of Truemind Capital Services

Platform is an infrastructure which takes care of everything that is required to run a business and it lets you focus on your core skillset which you are looking to build. Platformization i.e. building a platform to conduct business provides a common ground for producers to meet consumers or vice versa. During this matchmaking, a platform provides inherent business capabilities in terms of unit economics by offering scale and network effect to reach out to the critical mass.  Platformization has changed the banking landscape and is making great strides in investment management industry. Future of investments is more platformized, more technology and digital driven.

Some of the Popular Platforms and Their Offerings:

• AWS and Azure Offerings: Cloud computing services
• UPI Offerings: Payment infrastructure
• AADHAR Offerings: Complete kit for identifying and onboarding new user
• Amazon Offering: Entire infrastructure in terms of reaching out to consumers, completing transaction and delivery available to producer to sell in India and abroad
• Swiggy Offering: Cloud kitchen for discovery and distribution of feed created by chefs who just focus on cooking part

Platforms like above helps reduce the time to launch and scale a business. Platforms can be pure play aggregators like AirBNB or can be software as a service like Shopify.

Disruption in Banking Space

Many banking services like deposits to lending to payment to investing are disrupted and unbundled. Entire aspect of banking has been split into individual services. Fintechs in partnership with incumbents and consumer companies are coming with specialized offerings on top of open banking platforms for retail and corporates.

Due to availability of financial infrastructure platforms, any company can offer financial services using APIs. Many Fintechs are using open APIs to offer services in insurance, lending, payments, investments etc.

How does this change the Banking Career landscape?

Digital banking has become an essence of banking in 2021. Traditional way of banking in branches has given the way to tech-based banking solutions. Increased demand can be seen for digital officers and product managers for building and stitching solutions across different banking products to build more personalized products for target market.

Relationship managers have to be digitally savvy to help client’s access specialized digital solutions offered by the banks. Robotic and automation are improving the efficiency metrics of the banking operations while they are looking at their bottom-line and focusing more on scale.

What is happening in the Investment Management Space?

Platformization has impacted investment management space not just in India but globally. Unbundling of investment management services has happened over the last few years. Open platforms can be used to scale while you focus on your core skill-set of research, asset allocation, trading to name a few.

The terms like interconnected systems, machine learning/artificial systems, Open platforms, APIs should be well understood by everyone having a career in investment management space. Embracing technology is required to achieve scale in the coming future.

Careers are getting more tech-based due to paradigm shift in investment management led by platformization. There is a significant shift in the thought process of new school compared to the old school. Earlier on the resources front, it was all about capital and man power but now it is about data and API. Previously it was about building a product with mass market appeal but now the focus has been shifted to building products with more personalization. Now product management has overtaken relationship management because the customer is interacting on a digital platform. Although communication and networking skills are still important in investment management area but that should be accompanied by aptitude to embrace technology.

Top Skill sets that are inevitable in Careers of future

There is a need to challenge status quo in everything that is done today as it will be done differently in the future. Cross disciplinary approach is needed to solve every problem and no problem should be looked at in isolation.

Having aptitude of understanding technology is very important. Hands on in programming to an extent will help a lot in the long run. Any language such as python, Matlab is a good start irrespective of whether you come from technical or non-technical background.

Empathetic understanding of how a customer looks at wealth management and what the customer expects needs to be built in the user experience design of the digital product. This requires ground level face-to-face understanding of the customer.

Specialized investment management skill-sets especially CFA candidates and Charterholders will drive the innovation in reimagining technology led innovation in Investment space.

For Entry level/early in Career Stage – you need to build a moat by enhancing demonstrated skill sets in your area of interest like research, asset allocation, investment banking, fund management, trading etc. You need to constantly learn by challenging status quo. Augment your niche skill sets as a CFA Charterholder by learning from continuous education programs conducted by CFA institute.

For those coming from the engineering background need to capitalize on programming skills and technical aptitude. For those coming from non-technical background, learn programming at early stage. Build the technical aptitude to adopt and understand technology, inter-connected systems, open platforms, APIs, Cloud Computing, automation tools, product centric approach.

For Mid-level in Career Stage – This is the most exciting time to accelerate on technology led innovation in your respective space of expertise. Need to capitalize digital network effects in your profession. Promote creative thinking and cross-disciplinary approach to problem solving.

For Senior-level in Career Stage – It is the best time to scale your moat by bringing platformization in whatever you do to achieve scale. Entrepreneurship is also feasible within short span in this AWS era of financial services so may be this is the right time to become an entrepreneur. Make data handling and digital transformation an important element of future business decisions. Leverage API economy, inter-connected systems, cloud unit economics, scaling with network effects through platforms.

Upcoming Career Opportunities

Upcoming career opportunities in investments and trading are becoming more technical across entry level, mid and senior level positions. Data scientists, AI/ML experts, software engineers are need in core technical skills. Expertise in analytics, product management, automation and digitization of services to reduce operational costs and enhance digital experience of customers is in demand.

One can also take entrepreneurial route using open platforms to build business at scale.

Implications on Remunerations and Career Growth

Irrespective of the experience, demonstrated skill-sets and how you create high impact in your role to make the organization future ready will be a major factor in deciding your remuneration. Embracing platformization in your skill-sets can help you scale area of business non-linearly and compensations and career growth also takes similar trajectory

A CFA charterholder or equivalent with a non-engineering or finance background but with aptitude to think products and technology and having programming knowledge can easily command a significant premium compared to one with no technical skill sets/aptitude.

Link to webinar: https://www.cfainstitute.org/research/multimedia/2020/career-insights-platformization-of-financial-services-and-the-future-of-careers