Negotiating Canada’s tech talent shortage
Competition to hire the best and the brightest is fierce among employers, including family offices.
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Most Canadian organizations are looking for workers with digital skills—and many are coming up short. Even in the world of IT, at least 55 per cent of Canadian tech entrepreneurs say they’re finding it challenging to hire the talent they need to grow, according to a 2022 study by the Business Development Bank of Canada.
Yet non-tech industries like financial services—including family offices, whose technology needs are rapidly evolving—are facing the same IT talent crunch. In response, many smaller enterprises that need to choose between developing that talent in-house or looking outside their enterprise are turning to service providers such as RBC Investor Services (RBCIS) to leverage technology on their behalf.
Paul Burd, head of client operations, RBCIS, has experienced firsthand the challenges that all organizations looking for tech talent are facing. Prior to joining RBCIS, his career encompassed global roles in the financial services industry, including positions at Fidelity International, Barclays Investment Bank, JPMorgan Chase and Goldman Sachs. In most cases, developing the in-house technology services on which RBCIS clients are increasingly dependent presents a near-insurmountable challenge for smaller enterprises.
“Family offices are growing and also becoming more complex as the products they’re trading and the activities they’re managing are becoming more complex and diverse,” he says. “Our clients are creating greater demand to support the activities of those enterprises as we pivot to cloud technologies and fintech solutions.”
If smaller enterprises such as family offices attempt to bring tech services such as data consolidation, real-time portfolio reporting and other securities services in house, they face direct competition from larger companies, which often possess an innate advantage in acquiring tech talent. By contrast, RBCIS can leverage tech talent from candidates across the entire RBC organization.
“We’ve been quite successful in acquiring tech talent across the RBC enterprise, hiring people out of our capital markets space and out of our wealth and insurance businesses,” Burd says. “We have a deep bench of knowledge and experience.”
As a division of Canada’s largest bank, RBCIS has the resources to do what many organizations don’t: “grow” its own IT talent. For example, when RBCIS looks to newer graduates who have the skills to support fintech solutions, it can also invest additional training resources in new hires who have no investor services experience.
Additionally, RBCIS can develop talent among lateral hires from sectors where candidates possess at least some of the qualities the organization is seeking. These might include candidates with strong leadership and technical skills from the manufacturing sector, from the armed forces and from the ranks of data scientists.
Larger companies also have an advantage in that tech hires look beyond compensation to ways in which the organization offers a clear trajectory for career development. In addition to technical training, high-performing, high-potential individuals at RBCIS are receiving management and leadership training.
“Over the past few years, we’ve been very focused on providing high-potential people with opportunities to develop and climb up the managerial ladder,” Burd says. “That’s very important from a succession perspective. We also need to keep them interested in what they’re doing so we can retain them, offering them a range of projects across products to keep them stimulated. Some of our current projects, for example, involve digital technologies and artificial intelligence.”
Tech employees in smaller family offices or other small company environments are less likely to see the variety of projects that will stimulate their interest, or the opportunities for advancement that will keep them from taking their skills elsewhere.
For a family office to bring its own tech services team in house would also require a significant investment in proprietary technology. In contrast, RBCIS is currently making significant investments to upgrade its core technologies, in many cases with partners outside of a strict vendor relationship.
“We’re working with fintechs in a partnership where both parties have skin in the game to develop products that will ultimately benefit family offices,” Burd says. “For smaller enterprises, it would require investing millions of dollars in the development of best-in-class core and niche products that are already being developed by organizations that can provide these services for them.”
Although software-as-a-service (SaaS) and application programming interfaces (APIs) can expand the technological capabilities of family offices, there are also implementation costs associated with those products and services.
Finally, technical support for financial services products, including security, should be available 24/7 to assure continuity of service. That’s also more difficult for a one- or two-person tech team to provide in a smaller enterprise.
“Ultimately, all enterprises looking for top technical talent are fishing in the same small pond,” Burd says. “Larger enterprises are likely to offer a more stimulating work environment and provide career advancement opportunities. Tapping into those client advantages eliminates the costs of competing for and retaining top talent, while providing full access to the cutting-edge technological capabilities RBCIS is developing — but at a lower shared cost.”
This story was created by Canadian Family Offices’ commercial content division on behalf of RBC Investor Services, which is a member and content provider of this publication.