This article is part of a series of special reports entitled “The New Normal” appearing in the March 30, 2020, edition of InvestmentNews.
At some point, ideally in the near future, the COVID-19 pandemic will pass and the financial services industry will be faced with the question of whether it makes sense to bring all those newly remote workers back into the office.
After just a few weeks of adjusting to expansive work-from-home policies, employees and owners of businesses large and small are realizing that remote work could be part of the new normal in the post-coronavirus world.
“We are going to see a massive change in society postcrisis, and it will permeate every aspect of life,” said Ric Edelman, executive chairman and co-founder of Edelman Financial Engines.
In addition to anticipating a greater appreciation of things we used to take for granted and speculating that “handshakes are gone forever,” Edelman believes “the idea of working remotely will be huge.”
“Corporations will discover the amount of money they’re spending on expensive real estate can be sharply curtailed by remote work,” he said. “We will also see business travel curtailed now that people are rediscovering the benefits of teleconferencing and that picking up the phone works just fine.”
Mr. Edelman, known for his research into future trends, sees financial services as one of the industries that could benefit from more liberal use of remote-work policies.
“No question, the bulk of the American workforce will return to normal, but a great many in the service industry will be working electronically because their location doesn’t matter,” he said. “Many employers will discover what they thought was essential by having employees in the office isn’t as important.”
Jud Mackrill, chief marketing officer at Carson Group, where all 250 employees are now working from home in response to the pandemic, said the ability of people to work remotely will emerge as one of the “silver linings” of the deadly coronavirus.
“I definitely think some of our employees will continue working from home, and this will be a positive for the way we all work,” he said.
Mr. Mackrill said that by being more open to the idea of remote employees, companies will expand their access to potential employees.
“This will be a good opportunity for wealth management to embrace more diverse work styles,” he said. “Just think about how it makes you a better recruiter of employees, because certain people don’t want to relocate.”
The adjustment to suddenly being thrust into remote work hasn’t been free of glitches, but people are generally adapting.
At Fidelity Investments, where 90% of the global workforce is now working from home, Pam Holding, co-head of the equity division, is holding daily video conferences with more than 250 people on the line.
“The nice thing is, because we have a global investment organization, we’ve been able to learn a lot of great lessons and be prepared,” she said.
Anthony Scaramucci, founder and managing partner of SkyBridge Capital, said he thinks “more gets done with face-to-face meetings.” He also expects a negative impact on commercial real estate if companies use remote work as a reason to cut back on costly office space.
But he sees the advantages of having people work remotely, which all 52 SkyBridge employees have been doing since early March.
“We recognize through WiFi and VPNs, we can get access to work in our homes one step away from our beds,” Scaramucci said. “A negative is everyone is home so we’re learning about the WiFi capacity of Verizon and ATT, while every child in America is home watching Netflix.”
Dani Fava, director of product strategy and development at TD Ameritrade Institutional, said that as advisers continue adapting to new ways to work and communicate, they will develop new habits and practices.
“The biggest behavior change is breaking old habits,” she said. “Now that advisers have no choice, they’re helping clients figure out how to use Zoom, and you can’t go back to not knowing how to do that.”
While she sees the advantages, Fava said that remote work is still limited when it comes to certain areas, such as training new employees.
A survey this week of 473 advisers who custody at TD found that 47% do not believe working from home will become the new normal, while 45% believe it's the future and are looking forward to it and 8% see it as the new normal but are not excited about it.
Training, camaraderie and the need for personal interaction were all cited as downsides of remote work by John Moninger, managing director and head of retail sales at Eaton Vance.
“I’m just looking at the flow of emails today and it would be difficult for someone to jump right in while working remotely,” he said. “But I do see some flexibility on the back end of this virus, and the acceptance of technology has grown exponentially.”
Most people don’t expect the financial services industry to permanently transition from its remote-work levels of 10% to 20% prior to the coronavirus to the current levels of between 90% and 100%.
But even just a few weeks into what could be a long stint of working from home, professionals are recognizing some advantages and anticipating wider adoption across the industry.
“I believe this crisis has taught us how innovative, creative and resilient we all can be,” said James Guarino, managing director at the advisory firm of Baker Newman Noyes.
“We have adapted to our new working circumstances in a relatively short period of time and the true leaders of our organizations have emerged and they are guiding us through these uncertain and precarious times,” he added. “It is my opinion that the financial services profession will find a happy medium with regard to the choice of working from home or being physically present in the office."
"Much of what we do has a personal nature to it and this relationship is epitomized by face-to-face contact. This experience is challenging to replicate virtually," Guarino said. "Also, much of our work can be successfully accomplished remotely. I see a healthy mix of both service models going forward.”
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