An interesting article on the Financial Times talks about a new trend of MBA's going into banking in order to work with the tech industry:
The banking sector is holding its own as an MBA employer. But it is doing so in part by offering new kinds of jobs, either as part of in-house teams developing new digital strategies or for those who want to work for fintech companies.In the US, some of the biggest opportunities for those hoping to work in banking are close to the tech sector in California. It means even MBA graduates who do not take jobs in big tech may end up working for these giants indirectly, for example by serving the tech sector in a large investment bank.
A thorough understanding of the digital world is essential for those going into finance, she adds. Banks are interested in building new strategies based around machine learning and other technological breakthroughs. “The skills they want are digital, such as data analytics and AI,” Ms Briggs says.
The increasing competition for MBA's by tech companies such as Amazon, Google, and Apple, puts pressure on banks to provide more tech-related roles. So no matter where you go, there is a big chance that you are working with the tech industry in some shape or form. If the trend continues, then the skills needed to succeed on the job tomorrow might be very different than those needed today.
What does this mean for us students? How important will tech skills be for wannabee bankers?
Do you think this trend will continue?
How do you think banks will utilize the new technology (such as AI)?
Thoughts?
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There are plenty of non-investment banking jobs for MBAs at Big Banks, after all they are large corporations that need to be "managed".
Traditionally, you had Corp Fin (like Citi) and Strategy Roles (JP Morgan) - but now there are roles in tech, credit card strategy etc.
The day that sales ceases to exist is the day machines takeover and humans lose. This is both from a bus dev & sell side services and products perspective. All of the tech in the world should never replace who is making the final decisions.
No its not. I am a senior at highschool in a pretty high socio-economic area and no one wants to do banking. All the dream jobs are either at a large tech company, having a start up tech company, medicine, or something creative/artsy like a writer or philosopher. It doesn't seem like banking gets much respect outside of the financial sector. I was talking to my aunts, uncles, and grandparents and they all thought of investment banking as a way to sell your soul for money in an industry that is worthless (Ignorant I know). People seem to value innovation and making a difference instead of becoming financially stable. I am not saying one is better than the other; just stating my observations
In my experience, that's because most people aren't really familiar with IB, consulting, or asset management unless they have parents/siblings/aunts/uncles that work in those areas.
At least where I grew up (not even close to a financial hub), most of us in high school didn't have any interaction with those professions, and thought that if you worked in 'finance' you were a stockbroker or financial advisor. I didn't really learn about the other paths until college
Two points:
most people's contact with anyone in "finance" is usually a financial advisor, and maybe they know someone who is a "trader". Other than that, most people's knowledge of finance is from watching wolf of wall street or the big short. Maybe they saw mad money once. I agree with the post above, most avenues in finance are not explored in school mainly because most teachers themselves don't understand the avenue.
People tend to value innovation/dreams jobs because of the disney narrative involved (meaning what they see in a movie or read in a book). For example, if you love to bake and open a bakery, outside people think it's baking bread and cupcakes all day. They forget, you have to clean the store, do the books, pay the bills, get insurance, not exactly things associated with baking. But if you own a bakery, you love baking; love working out, start a gym; like kids, be a teacher. What people tend to forget is that all these things are done for profit, which is also what people do when they enter banking/corporate, they want to make money aka profit.
Very true.
You can see this play out in recruiting too. The kinds of people who end up in finance generally come from:
kids who have exposure to finance via family and family friends.
kids that have exposure to finance by virtue of rubbing shoulders with the children of financiers (i.e. the elite private school and elite public school set or kids involved with elite summer programs)
kids who were guided through diversity programs and mentorship schemes like SEO
kids that fall into finance by way of attending a top university
kids that have been reading about WSO and finance since early high school because they stumbled upon the site
kids that find out too late and generally miss out on UG recruiting because of it but come back at the MBA level
Are you guys even reading the article? This about MBAs - not college kids. Lot of self selection before someone attends a top ranked B School. Real question is whether banks can attract MBA talent.
The most important skill you can build, aside from being able to sell yourself or something else, is adaptability. It is, most certainly, a skill that can be learned. You need to learn how to manage through gray areas, take on any task that comes your way, improvise when needed and never be afraid to take on something that you have no idea how to accomplish until you start doing it.
This is a trend that hasn't changed, and will continue into the future. A different issue is how we have shifted from financialization of companies to some variant of that with technology. Everyone is racing to leverage, develop or jump into a technology related area - be it leveraging data for enhanced or adaptive marketing, democratization or increased access to information through centralized portals, block chain looking to slice out the middle man for transactions, pick through unstructured data, turn data into words, etc, etc, etc. Those are, by the way, some of the least informed and generic examples out there.
As far as the importance of 'tech skills' i'm of a few thoughts. I think you need to choose where you want to be in the food chain. Everyone should have a basic understanding of how to use technology and/or how, broadly speaking, many technologies work. From there, it's figuring out what you want to do - do you want to build things from scratch and code? do you want to sell the outputs of the building to folks who can leverage it? do you want to translate tech speak into business speak, and vice versa? Etc.
I'm shocked that a higher % of Stanford GSB graduates went into finance in 2017 than tech.
I made a similar thread on WSO, where I argued that MBA roles in tech firms are overrated while banking is underrated.
I have thought about this and wonder what the MBA entry level role at FAANG frims even is, I would imagine you are a glorified accountant or sales at these tech firms, just because you can't do any of the firms core competencies to improve the product/Improve the process if you don't code or understand tech inside and out.
Now undergrad comp sci and an MBA could be very powerful at a place like this but I feel like most roles would utilize one and not the other.
I could see Corp/Dev and stuff being very cool tech firms which is still recruited over from IB.
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