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Eyeing the Front Office? Step One is to Prepare

Making the jump from Operations to front office management often brings with it a healthy dose of bumps. Factors like education and perceived skill can pigeon-hole candidates, forcing them to overcome the stigmas associated with years spend in the back office. The good news? It can be done.

Doug Rickart, of Robert Half International in Minneapolis, argues the stigma associated with Operations jobs no longer exists. "There are a lot of very talented professionals on the Operations and support side in financial services," he says.

While a number of people on Wall Street might disagree, the truth is the expertise needed for trade reconciliation, processing and clearing isn't much different than that required for front-office work. Both involve an arsenal of analytical skills and a logical approach to problem solving.

Still, making the move isn't only about the work. It's about changing perceptions, too. Overcoming how people regard a back-office resume requires taking a hard look at your background to identify those abilities that will be viewed as assets in investment banking. Often back-office functions like trading support, settling trades, P&L and risk management are the very functions of the average first- or second-year investment banking associate.

Having an open mind is important, says Rickart. So is making use of resources that are available internally. For example, do you have a mentor, such as an investment banker, who can provide advice on how to make a change? Is moving into a junior position an option? And, Rickart recommends professionals making the switch shore up their credentials by working toward an MBA or earning a CFA.

A Strategy That Fits

A leap from portfolio accountant to portfolio manager often requires strategy modification. While firms like JPMorgan or Morgan Stanley offer the widest range of opportunities, top-tier investment banks also have the tightest competition. As an alternative, look to regional firms or boutique firms, such as asset or risk managers. Firms specializing in a single area, such as settlements and clearing, can often offer you a broader set of responsibilities. At such firms, professionals are more apt to have the chance not only settle to trades, but to analyze assets and investments, as well.

And, as banks delve into areas such as risk management and financial controls, the lines between the front and back offices are becoming blurred. "Someone doing risk analysis on a portfolio is developing many of the same skills that are transferable to the front office," observes Rickart. "You're basically taking post-analytic work and doing it on the front end."

If you're at a major investment bank and don't want to jump, you'll face a tougher time changing perceptions.

Rickart notes there are many professionals in Operations whose talents are highly regarded. "It's a matter of getting respect," adds one UK recruiter. "In the back office, you interact with client banks and their customers, helping value, trade and settle their derivatives transactions. As your skills develop, you'll be eligible for other opportunities and promotions within the company."

What do you think? Is it really so manageable to move from the back office? Or do people behind the scenes still get a bad rap? Post your comment below.

AUTHORScott Krady Insider Comment
  • Al
    12 June 2009

    You believe me or not, I have moved from backoffice roles - portfolio accounting, middle-office role - asset allocation then now real-estate financial analyst focusing on project finance, financial modelings & corporate strategies. Thus, it is proven that "Nothing is impossible"

  • An
    3 January 2008

    Well ! as many of you stated, I am completing my MBA(part-time) from a top-tier Business School but still see no way to break into the Front Office. I support the Back office IT functions of Fund Managers and would like to move to a Portfolio Manager role.

    Possible path could be MBA -> Research Analyst(Asset Mgt.) -> Portfolio Manager. Does anyone spot any flaw in my plan ? Suggestions welcome ..

  • Jo
    Joseph W.
    10 December 2007

    Pete - I did the same sort of move. Was hired as a developer for into the risk group of energy consulting firm. Built the system for them, and learned the business at the same time. Black Scholes, options, swaps - all these were new to me when I started. Was at this firm 5 years, and got an MBA (focusing in Financial Engineering) part-time as well. Have a Masters in Physics before that. Started playing around in Matlab to improve system efficiency, and learn that application since I think it looks good on my resume. Understood the financial models better than anyone else in the group - on the analyst or IT side. Now working as a Risk Analyst at a different firm, where my primary role is financial, but my systems background is helpful. Looking towards moving to front office, but still evaluating options & chances... good luck!

  • dr
    drv ops
    27 November 2007

    i am in deriv ops in a hedge fund. not to be haguhty or anything, there is maybe one or two people who are as smart as i am in ops. how can i move up?

  • pe
    8 November 2007

    It is interesting to read discussions about moving from BO or MO to FO. What about even moving within the BO and MO?I'm an IT auditor who wants to move into financial risk management space. what chances have i got? I intend to do an MSc in Financial Risk Management/Financial Engineering

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