Why Do People on Here/WSO Crap on "Back Office" So Much?
Yeah, I don't make as much as my friends who did IB, but I'm still making 6 figs after 5 years in a big city where 6 figures actually has purchasing power (i.e. not NYC/SF/LA) and work a helluva lot less. Furthermore, a lot of my friends in IB have either washed out on the buyside and are looking to get their MBAs, or missed on PE recruiting and are in corp dev/corp fin roles anyway. Sure, the ones that made it on the buy side or moved up within banking are killing it, but they are also completely out of shape, having dedicated almost all their time to being the best at their job, and are constantly worried about job security and don't ball out all the time anyway.
Finally, even though I don't make that much, I can also live anywhere in the country instead of mega finance centers and can still make upwards of $200K as a controller or upwards of $300K as a CFO (if I'm lucky) even at regular MM companies. For example, I want to move to Denver because I love the outdoors/skiing, and it's much easier for me to find a job out there than a comparable IB/PE job.
Is it really the money/"prestige" or why is it such a big deal online? Outside of a few assholes, most people in IB/PE value whatever contribution I have to their project and don't have the same attitude as people on finance sites. Why is it so commonplace to crap on "other" finance careers online then?
Because we want to fit in.
I don't want to wait 5 years to make six figures, I want to make six figures now. I also want to live in NY. If I don't like it, I can move anywhere after two years and still make six figures, rather than having to wait 5 years. I have nothing against people who have back office jobs but they are not at all what I'm looking for and the same goes for most of the people on this forum.
this is the "trading" forum...this is where people talk about becoming a trader, advancing as a trader, and learning about trading. if you want to learn about a backoffice career...i'm sure there are other forums out there for you to find. but just remember...without the traders, the back office would be out of work.
Without back office (a GOOD back office), traders cant do their jobs...goes both ways tbh. If all your trading systems are messed up, you dont know your risk, trades are missing etc
it really doesn’t go both ways..if there’s no revenue producer what would the back office do...?
do you feel better now?
I think you need to go to Backofficeoasis.net
I love the back office and honestly I can't wait until I can get out of public accounting and enjoy that sweet 120k salary in a LCOL area. One of the benefits of accounting is that you can really move anywhere and find a job.
Short story: back office conducts administrative functions which aren't necessarily transferrable skills. Whereas if you're in IB, ER, or similar, you have good financial analysis skills or relationships skills that can transfer well into other jobs both inside and outside of the financial services industry. Back office is by nature very niche specific to the finance industry, so your options are limited--and, since it's an admin role, you basically work yourself out of a job. Back office exists only because an AI or other computer hasn't been programmed yet to do that work instead of you. I predict that time will come eventually, especially with advances in blockchain tech and DeFi which will change the game in things like derivatives markets.
Look, if you want an easier lifestyle, go for it. It's your career, not mine so I can't judge. That said, coming on a forum like this and saying you prefer back office is like going to a barbecue joint in Texas and complaining about the vegetarian options. It just doesn't fit the context lol.
One last comment, it's not about "prestige." There are just certain realities of the skillsets that you build doing front office versus the skillsets that you build in back office. One is transferrable and marketable, and the other is not.
How are BO skills not transferable? Sure, you might not work in PE, Consulting or in the trading desk of a L/S HF, but the tech and quantitative proficiency you acquire in certain roles is transferable to other kinds of jobs. Risk management is an example (though MO not BO) of a job of which the skills can be leveraged to become a quant. Tech guys can go to startups and make as much as bankers or investors (more if you account for WLB).
Interesting point on the automation - what processes do you think will be the first to be migrated, or which ones do you think are the most costly to maintain without automation?
Wrong. Bankers skills are totally useless out side of finance. A banker is only useful for a Corporate Finance team where maybe they'll do 1 deal a year if the company feels like making an acquisition, which is also usually lead by the CFO who most likely worked as a Big 4 accountant and has a CPA. The only exit ops for bankers are other opportunities in finance, it doesn't open doors to any other industries. As far as companies are concerned all a banker is to them is another version of an accountant and not even a valuable one since they don't do any actual accounting work. There's a reason why you rarely see any former bankers working as a CFO or any other key/core finance role at a normal company and why said roles are usually filled with former accountants.
Imagine your parents putting you in a top private school for you to get into Harvard, then you end up at Michigan or Penn, and then you decided to be the hardest, most anti social nerd on campus, and now you need to also go work in a windowless room, with a constant buzzing, droning sound as background texture, doing repetitive processes, with 0 recognition from those parental figures who call all the shots. No. WSO HATES back office. It's an affront to most.
The work is mostly repetitive and boring with no or limited learning potential and very low, if any, transferability of skills. You're mostly surrounded by unambitious underachievers who are doing that job because of complacency rather than anything else. I know because I used to work in the back office, and boy was I happy once I received my FO job offer. And trust me, even if I was paid the same as front office bankers (I wasn't) I'd be dying to get out and do an FO job, even at the expense of a work life balance.
Don't take this the wrong way, there's nothing wrong with working in the back office, but to put any higher value or meaning to it is a long shot - it is what it is, a cost center that exists because it musts, and if the bank could get rid of it, they would do so in a heartbeat.
So what you're saying is you traded one mindless repetitive job for another mindless repetitive job?
Most if not all jobs are mindless and repetitive at the most junior levels. However, compare a BO MDs day to day work and a FO MD, which one is more mindless/ repetitive?
If you want to be filthy rich doing back office or middle office related functions... automate shit like how broadridge did and take over the street... now they're filthy fucking rich. If you not keen to technology shit but want to secured your operations job... know everything from front end to back end so when something blows up, people come to you for questions. Don’t just be a puppet doing mundane task every day.
I both agree and disagree with you.
I agree that people tend to crap on back office in a way that doesn’t quite make sense. People have different interests, different opportunities, and prioritize things differently. There are people in back office because they couldn’t get “better” (or their preferred) jobs and then there are people that simply prefer it (whether the work or lifestyle).
That said, I don’t understand your need to rationalize it to yourself. There are plenty of FO roles (especially on the buyside) that have good hours and excellent pay (7 figures). I know people who stay in good shape, take vacations, work 50-60 hrs, and get paid...a lot. Is it likely to land there? No, probably not being able to have the perfect job, but that is what many people are shooting for. The main reasons I have seen for people preferring FO:
1) in general more interesting work (although that can be debated in entry level IB jobs). Definitely true as you move to HF or PE and have more control over investment decisions. It becomes more of a “what are your ideas” rather than “implement these ideas”
2) opportunity/upside - FO roles offer more career opportunities and much higher upside on comp. people tend to underprice the risk (or be willing to take it) and focus on the upside. While people fail and burnout that isn’t the mentality that people go into the career with.
3) prestige - I see this less, but yes some people care about prestige.
@MylesDawson people on here will hate on you for whatever reason but they get really triggered when you don't work 80+ hours and still make 6 figures in a LCOL city. They assume because you're in the back office you are a drone doing repetitive tasks (because IB excel and power point models aren't repetitive apparently) with no ambition. People can make great careers and have importance to their firm in any role. The only difference is that FO people get to the 6 figures out of the gate normally. There is nothing wrong with working your way up to that level while having a solid work life balance. They get really mad when you make 6 figures out of college and only work 8-5 while living in a very tax friendly state.
I think it’s mostly people that haven’t even graduated college. I couldn’t even do my job if it weren’t for the support of back office staff. You could arguably run a trading floor at just 50% FO capacity, but you sure as hell could not with just 50% of the BO staff. Those are facts.
I can't emphasize this enough. It's basically people who haven't really worked in the industry. FO roles are going to continue to go down the drain especially in S&T as banks realize they don't need the headcount.
Meanwhile support staff are crucial, whenever something needs to be fixed or developed, guess who is doing that? Recon and settling our trades? Without them, we cannot do our jobs period. If anything, you need to hire more support staff especially in systems development and maintenance.
The industry (both sell-side and buy-side) needs to be downsized considerably - which we've already been seeing over the past few years. The days of being "ok" at your job and being paid decently are over and never coming back. Banks are rightfully putting more budget towards tech development and less towards paying FO staff.
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