Executive Outlook
Taking stock of learning agility on Wall Street by Alan Guarino
June 2010
Alan Guarino is global sector leader of FinTech/Electronic Trading & Transaction Services for Korn/Ferry International. He is based in the New York office.
Analysts, pundits, journalists, academics, legislators and regulators worldwide are attempting to make sense of the financial crisis of 2008-2009 and its aftershocks, like the May 6 $1 trillion market plummet. There is discussion of systemic risk, systemic failure, principle- versus rule-based regulation, exotic instruments and on and on. What has not yet come to front and center is the people. After all, it was people who decided to take those risks, people who made the judgments, and people who designed structured products. The factory for the near global collapse may indeed have been lax regulation, some greedy mortgage originators, politicians seeking votes, and capital markets leaders taking risks with the carry trade. Yet individual people manned those assembly lines all the way to the meltdown. If financial services firms aren’t now taking a hard look at how they can better acquire, and deploy their human capital, they’re courting another disaster. Regardless of their place in the market (regulator,
bank, brokerage, or exchange), effective processes to, recruit, assess, and develop people will be essential. Firms need professionals with the same depth of expertise in talent management as they have in law, or finance, or technology. Other industries are light years ahead of Wall Street in this regard.
The pace of change shapes talent needs Financial services organizations worldwide operate under four key drivers: technology, regulation,
competition, and globalization. On all four levels, practices are fundamentally different from a decade ago, and the pace of change is speeding up exponentially. For regulators, principle- versus rulebased regulation and global harmonization are trends; and machines versus voice-traders has evolved beyond just the equities space. In this ever-shifting environment, securities firms need to seek and develop people who can adapt quickly and grow their thinking — not only in response to the financial crisis, but in anticipation of the flood of unstoppable changes rolling toward the industry. Such individuals, who can fulfill a variety of roles within changing management structures, possess a personal attribute called learning agility. Learning agility —the ability and willingness to learn from experiences, successes, failure and exposures — may be the single best predictor of a person’s potential. Empirically measurable, it is the key to identifying leaders and future executives, certainly. I also believe it is applicable when predicting the potential of a trader, who must adapt to changing market dynamics and market structure, as well as to a risk manager who must continually evolve her thinking as markets change. Learning agility in either of these roles can spell millions of dollars made or lost. In short, learning agility assessments can determine who on your team has achieved their highest
level of likely success, and those who can still achieve greater success as they take on new challenges. While just one of myriad tools available, learning agility represents the best starting point for finance organizations looking to optimize their talent pool. Wall Street faces a world of new challenges right now. The sooner firms focus on their acute need to hone talent management practices, the sooner its immediate and longer term challenges will be on the way to being solved. They can begin this process, one tool at a time.
About The Korn/Ferry Institute The Korn/Ferry Institute generates forwardthinking research and viewpoints that illuminate how talent advances business strategy. Since its founding in 2008, the institute has published scores of articles, studies and books that explore global best practices in organizational leadership and human capital development.
About Korn/Ferry International Korn/Ferry International (NYSE:KFY), with a presence throughout the Americas, Asia Pacific, Europe, the Middle East and Africa, is a premier global provider of talent management solutions. Based in Los Angeles, the firm delivers an array of solutions that help clients to attract, develop, retain and sustain their talent. Visit www.kornferry.com for more information on the Korn/Ferry International family of companies, and www.kornferryinstitute.com for thought leadership, intellectual property and research.
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