Last week, I had a coffee with the head of research sales at an investment bank. When you work on a trading floor, it’s well known that the people in sales trading and research sales are paid well, so I wanted to know what life was really like in his area of the business.
He gave me his honest opinion: most people are superfluous.
My friend compared research sales to the likes of a football team. Although you need a full team to play, only two or three of the players are needed to win. Unfortunately, you need a whole team to support them.
As the head of the team, he sees people in his business becoming even more specialised. He estimates that within a few years, it will have completely changed. You’ll still need a macro research sales team to give an overview of the general market and sector specialists. But the research sales generalists will dwindle.
If you’re a generalist, you’re just there to support clients that the firm feels it has to cover. Specialist salespeople are constantly talking to traders and have a good understanding of volumes and client needs. They know their sectors inside out – ask them how many cars Volkswagen sells in China and you’ll get a quick answer. Generalists, thought, are detached. Covering vast numbers of clients, they get their data from research reports. With the dawn of natural language processing, theirs is the kind of service that computers will provide in the very near future.
Generalist sales jobs are already going down hill. Clients are investing more in their own research and budgets are falling. If you work in generalist sales, your days are numbered. Specialize or get out.
James Jones is the pseudonym of an equity salesman who left a large US investment bank
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