For heads of operations at big funds management firms, moving 100 per cent of their staff to work from home was their biggest challenge of dealing with COVID-19. But what quickly followed was that share market and derivatives trading volumes spiked. It was a scramble to get back to business as usual.
Ross Gulliford, head of investment operations at Challenger Ltd in Sydney, told a Fund Business webinar last week (June 10) that there were monitors and even chairs leaving the office. “It was a logistical challenge. Some people wanted to keep two screens, etc. Our I.T. people got onto it early, though, even before lockdown. And then volumes went through the roof. March was a record month.”
Rob Scott, First Sentier Investors global chief operating officer, said from Hong Kong that moving to a situation in which 100 per cent of staff had to work from home in a very short period of time was a challenge.
He said the initial focus was the challenge of getting everyone working from home and then aimed for business as usual (BAU) from a risk and operations standpoint.
“We needed to make some quick decisions at the management level,” he said. “A lot of the staff had challenges working from home, particularly those that needed to do home schooling… We’ve been running daily committee meetings around pricing etc. Some of our project timelines had to be re-prioritised, with the less-necessary projects being delayed. But it was all continued and it was all pretty much delivered. Surprisingly, it’s been a pretty good result, and everyone managed to perform their roles with little [additional] risk coming off the back of it.”
Ross Gulliford said that in some ways the term business continuity planning didn’t really apply. “A typical BCP [business continuity plan] where the building or the communication centre is out has not applied so much… It was more a matter of BAU, but doing it from home and with increased volumes and liquidity pressures,” he said.
At Challenger, Gulliford said, the business analysts were moved back to work with the operations teams, which worked out well. There were annoying things for some staff, though, such as the internet dropping out occasionally.
Linda Coffman, New York-based executive vice president for the ‘Reference Data’ business unit of SmartStream Technologies, which ensures that data to institutional clients comes through at a high quality said: “I think that everybody was pretty happy dealing with the volumes. For ourselves we found it was very helpful to communicate with staff that BAU (business as usual) was the priority. We made people relax… But nobody thought we’d be here for this long. When they stopped to say ‘OK, if we are going to be here for three months’, what does that mean?”
She said that everyone had always known that volumes correlate with volatility. For listed derivatives, there were no new products, but the number of contracts exploded.” They more than doubled between February and March. “For us I think we handled exceptions pretty well. There was a lot of pressure there because of the increased volumes.”
Rob Scott said that in the OTC derivatives space, operations vendors across the board experienced challenges, particularly with respect to more manual transactions. India was a concern, with working from home there. “But people found ways to continue to deliver their services. Standards never dropped off. We had a weekly check-in with the business owners among our suppliers.”
Linda Coffman asked: “What’s going to stick?… There may be some silver linings which continue. Communications with vendors is an example. We found they got a more intimate relationship with clients. Everyone was happy to get on video calls. The relationship and partnership aspect clicked up a notch.”
Rob Scott said that “collaboration tools” came to the forefront during isolation. “We had struggled to get people to use them before.” He hoped that it would sound the death knell for the fax machine and “printing everything off”.
Ross Gulliford said: “This whole COVID time has been much more about people.”
The webinar – “Operational Resilience” – was part of a series produced by Fund Business, called “Leading Minds”. It was moderated by Wietske Blees, the editor at Fund Business. The second episode in the series takes place on June 24. It will discuss decision-making and data use against a backdrop of Corona virus, and, how data can be used to gain a clearer picture as securities markets appear to be de-coupling from the real economy. Here is further info or you can register here for complimentary access