Graduate Plus: These days it's prudent to be dynamic

Roger Trapp reports on innovations and risks in financial services

One thing that is going to confront graduates entering the world of finance more than any other is change. Now, just about every industry claims that it is changing at an unprecedented rate. But there can be no doubt that the world of pin-stripe suits and bowler hats that their fathers came across has been replaced by computer screens and other mainfestations of high technology.

The stable situation that existed in financial services until comparatively recently was characterised by a bank executive quoted in the recently- published book Igniting Innovation as the "3-6-3 rule". This translated as "pay 3 per cent for deposit money, lend it out at 6 per cent and be on the golf course by 3pm".

Any graduate expecting a career in banking or a related business to be as simple as that today is going to be in for a rude awakening. Rising expectations on the part of customers and increasing competition are putting tremendous pressure on financial services organisations. The spate of mergers and takeovers is one response to this situation. Another is to seek to be innovative.

The arrival of operations such as Direct Line demonstrates how the market can be fundamentally altered by one good idea. But the recent slide in that business's results as rivals have sought a piece of the action also shows that it is impossible to sit back and relax.

One banking organisation that - after a rocky period at the end of the 1980s - has established a reputation for innovation is Citibank, the US financial services giant headed by engineering graduate John Reed. He claims the organisation's hallmark is "our energy and innovation". Consequently, it seeks recruits who have the imagination and the drive to keep the bank one step ahead of the competition. That is the sort of thing all businesses are liable to say. But the delivery of it - particularly in the financial services sector - is rather more tricky.

Another new book, Market Unbound, by McKinsey & Company consultants Lowell Bryan and Diana Farrell, argues that the globalisation of capital - which is one of the drivers of the immense changes everybody is talking about - will create many opportunities for companies of all shapes and sizes. Work being done by Andersen Consulting also suggests that - despite the growth of financial behemoths - career opportunities in finance will not be confined to big-name organisations. There will even probably be many niches for single-person operations.

But this will not reduce the pressure. Bryan and Farrell imply that advances in technology make isolation of risk - a central part of financial services - much easier. But that does not mean there will be no failures.

As Kari Lampikoski and Jack Emden point out in Igniting Innovation, "The continuous change in financial markets is a kind of two-edged sword: it constantly brings new challenges and opportunities but it also causes major risks to financial institutions."

PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
Latest stories from i100
iJobs Job Widget
iJobs Student

Ashdown Group: Trainee / Graduate Helpdesk Analyst

£20000 per annum: Ashdown Group: A highly reputable business is looking to rec...

Ashdown Group: Graduate Data Analyst - Essex - £25,000

£23500 - £25000 per annum + Training: Ashdown Group: Graduate Data analyst/Sys...

Recruitment Genius: Graduate Account Manager

£16000 - £30000 per annum: Recruitment Genius: A Graduate Account Manager is r...

Guru Careers: Graduate Account Manager / Sales Executive

£18k + Uncapped Commission (£60k Y1 OTE): Guru Careers: A Graduate Account Man...

Day In a Page

Isis hostage crisis: The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power

Isis hostage crisis

The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power, says Robert Fisk
Missing salvage expert who found $50m of sunken treasure before disappearing, tracked down at last

The runaway buccaneers and the ship full of gold

Salvage expert Tommy Thompson found sunken treasure worth millions. Then he vanished... until now
Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Maverick artist Grayson Perry backs our campaign
Assisted Dying Bill: I want to be able to decide about my own death - I want to have control of my life

Assisted Dying Bill: 'I want control of my life'

This week the Assisted Dying Bill is debated in the Lords. Virginia Ironside, who has already made plans for her own self-deliverance, argues that it's time we allowed people a humane, compassionate death
Move over, kale - cabbage is the new rising star

Cabbage is king again

Sophie Morris banishes thoughts of soggy school dinners and turns over a new leaf
11 best winter skin treats

Give your moisturiser a helping hand: 11 best winter skin treats

Get an extra boost of nourishment from one of these hard-working products
Paul Scholes column: The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him

Paul Scholes column

The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him
Frank Warren column: No cigar, but pots of money: here come the Cubans

Frank Warren's Ringside

No cigar, but pots of money: here come the Cubans
Isis hostage crisis: Militant group stands strong as its numerous enemies fail to find a common plan to defeat it

Isis stands strong as its numerous enemies fail to find a common plan to defeat it

The jihadis are being squeezed militarily and economically, but there is no sign of an implosion, says Patrick Cockburn
Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action

Virtual reality: Seeing is believing

Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action
Homeless Veterans appeal: MP says Coalition ‘not doing enough’

Homeless Veterans appeal

MP says Coalition ‘not doing enough’ to help
Larry David, Steve Coogan and other comedians share stories of depression in new documentary

Comedians share stories of depression

The director of the new documentary, Kevin Pollak, tells Jessica Barrett how he got them to talk
Has The Archers lost the plot with it's spicy storylines?

Has The Archers lost the plot?

A growing number of listeners are voicing their discontent over the rural soap's spicy storylines; so loudly that even the BBC's director-general seems worried, says Simon Kelner
English Heritage adds 14 post-war office buildings to its protected lists

14 office buildings added to protected lists

Christopher Beanland explores the underrated appeal of these palaces of pen-pushing
Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Scientists unearthed the cranial fragments from Manot Cave in West Galilee