Panel discussion on “Sell-Side Solutions” at the 87th Annual Market Structure Conference

Jack Miller, Head of Global Execution Services, recently led a panel at the Security Traders Association’s (STA) 87th Annual Market Structure Conference. The session, titled “Sell-Side Solutions,” convened a group of industry leaders to discuss how sell-side firms are working through the pandemic environment and helping clients navigate the inherent challenges.

Joining Miller were Kevin Kruszenski, Head of Institutional Equities, KeyBanc Capital Markets; Philip Pearson, Executive Director, J.P. Morgan; and Vicky Sanders, Global Head of Investment Analytics, Liquidnet.

The panel kicked off with a discussion about the industry’s shift to remote work. The panelists shared their firms’ experience with the work-from-home paradigm and the opportunities and challenges that flowed from these arrangements. Miller shared Baird’s experience:

“We are still primarily still work from home. You can see I’m at my home in Milwaukee, Wisconsin, and we have maybe 10-20% of folks in the office. We never officially closed the offices, but we essentially sent everybody home back in mid-March like so many firms. It’s been a little bit of a volunteer system here for those that want to get back into for whatever reason, we’ve been able to accommodate that…

“In mid-February, I would not have agreed or wouldn’t have guessed that the transition to move to home from a trading desk was even possible, let alone something that came across very seamless… I think we owe a big debt of gratitude to our IT departments and a shoutout to the folks who really work on all the technology. It’s been a pretty good experience, all things considered, from that standpoint.”

The discussion then shifted to the topic of client engagement. The panel agreed the pandemic greatly impacted client relationships for sell-side firms. While firms faced new challenges in engaging with clients in the early months of the pandemic, the industry found a way to adapt and maintain client relationships. The panelists remarked their client conversations are beginning to return to temporarily shelved, “deeper-dive” topics. Miller agreed with the panelists’ comments and shared a similar experience at Baird:

“I definitely would echo that experience in terms of the pacing of the year. I mean, certainly in the springtime. We’d just gone through this kind of forced experiment of work-from-home. The markets were incredibly volatile. There wasn’t really an audience for probing into some of the deeper-dive topics. But as, you know, as the proverbial dust settled a little bit, there is now an openness and to the points, made by you, Vicky and Phil, a willingness and sort of a different ability to engage on of some of those sorts of things. It’s been an interesting evolution as the year has moved on.”

Panelists also spoke to the major challenge of competing for clients’ time and attention in the pandemic environment. Miller offered Baird’s perspective on the industry’s shift to virtual client meetings, events and conferences. He spoke about the firm’s migration of its annual institutional investor conferences to a virtual format in 2020:

“One of the big benefits of it, though, is it’s not geographically constrained. Before there was a lot that went into where we were hosting it and you would certainly see spikes of attendance sort of localized around that. Now the reach is much, much broader - but you have to compete for that… you know it is not a captive audience, as you said, it’s very easy to come and go. So certainly an interesting adaptation. I do think that there are certainly positives of it and things that will live through this period that we’re living through here.” 

To wrap up the panel, Miller turned the discussion to recruiting and onboarding. Each participant spoke to their firms’ experiences, and all expressed some surprise that it was possible to vet and successfully hire new employees in the pandemic environment. Miller added Baird’s perspective to the discussion:

“We have a very intensive recruiting process where it’s a lot of meetings, formal and informal - really getting to know people. That’s been a challenging thing to carry forward in this virtual type of environment and related to that is training. Jim Toes (President and CEO of STA) likes to say we existed in an apprenticeship culture where the way most of us learn our job is sitting next to a senior person and they show you the ropes.”  

All panelists held virtual internship programs over the summer months and had positive experiences. Baird also moved forward with its 2020 internship program, and Miller echoed the panel’s comments:

Just speaking from our own internship program over the summer – a lot of similar threads to what you touched on. Surprisingly successful. We were able to pull from a broader pool of folks, to help enrich their experience and ultimately not just evaluate the talent, but begin developing it, too. Previously it was a very localized experience, depending on which office the intern was in, which for us is predominantly Milwaukee. So, we’re able to draw on our global reach from that standpoint.”