galawdawg wrote: ↑Sun Feb 05, 2023 7:54 am
beyou wrote: ↑Sun Feb 05, 2023 7:36 am
Most public companies are moving jobs to places far away and losing key staff. Schwab is one of those firms.
Where did you get this information? I have never reached anyone at Schwab who was not based in the US. As far as I know (and I certainly could be uninformed), Schwab does not use overseas call centers.
And while Schwab has been eliminating or reducing duplicate positions as they complete their TD Ameritrade acquisition (as any responsible company should), I haven't read anything suggesting that they are "losing key staff."
Care to elaborate?
I said “far away places” not specifically India in relation to Schwab, though most companies are doing so for certain functions.
As to Schwab it is somewhat old news that they are moving much of their tech and ops out of their historically CA offices to Texas and other locations.
https://www.nbcdfw.com/news/local/charl ... 1/2514658/
https://www.schwabjobs.com/search-jobs
Having been a software developer and manager/CTO/COO at 5 fund manager, and an investment bank, for decades, hiring and firing positions, I can tell you that the knowledge required to do things right operationally in the back office was historically concentrated in a handful of cities. NYC, Boston, Chicago and to a lesser extent because of Schwab, SF have been knowledge worker hubs for decades, for all except the front line broker you see at branches (or talk to on phone). Years ago a couple of large banks openend major operations in Charlotte, NC, attempting to duplicate the knowledge base in a newer cheaper geography. I think they did achieve this to some extent though it took decades. I recall getting recruiting calls to solicit coming to Charlotte, but not everyone with experience (kids in school or spouse working) is willing to relocate, so these firms settle on hiring inexperienced kids and having the blind lead the blind. This happened at Vanguard and it is happening now at Schwab. It is not just retaining people with industry knowledge, but specific knowledge of your own internal systems that is also a key risk when relocating where employees do not want to relocate. I have seen this over and over in my career. There are stages of transition. Initially all is fine as they systems continue as-is, but over time as key staff leave and the systems they knew need enhancements/fixes, they take longer and/or done incorrectly, leading to years of declining service. EVENTUALLY, things should work out as the kids and new hires (without industry much less firm specific knowledge) learn the systems and the industry requirements/best practices, but this takes years.
Large mergers like Schwab is undertaking are always a distraction from meaningful operations and tech progress. Relocation is also a huge distraction, and they are doing both at same time.
The people you speak to on the phone may well be in a US call center and speak clearly and project confidence/competence to you, but ultimately they rely on all those tech and ops guys that are treated as interchangeable garbage by most financial services firms. If I had worked for Schwab in SF, had kids in school and family nearby, I would not move to Texas with the firm. They would lose my decades if very deep knowledge of both tech and fund management/brokerage/investing. I have read that industry averages of employee retention when relocating are close to 20% retained. Given there are so many specialties in tech and ops, and so little redundancy of job functions in staffing, no way 20% of staff can train 80% new hires. It just does not work in any meaningful timeframe. Management often gives staff 3-6 months to train new hires and then lets go the trainers who wont relocate, people who mastered their craft over many years, which leaves replacements pitifully unprepared. I have lived this over and over in my career. Do not expect the next few years at Schwab to go smoothly with the TDA integration moving ahead. You many not feel it, but I can guarantee you it is there behind the scenes.
The one thing Fidelity did better than the rest, they moved same tech/ops jobs within same region so people can stay near family and either make a different commute or relocate locally and still be near family/friends. Much smarter and their ever improving tech shows it, private firms often can do things better. When BlackRock was private, I asked a top exec “what is the tech budget”. His answer was essentially that there is none, we want the best, period. Since then while they have hired in other regions, they did NOT relocate out of their historical home, despite being HCOL, as they understood the value of both retaining key staff AND the ecosystem in NYC that existed pre-covid. Covid changed alot, but some firms still wont allow remote work for those who choose not to relocate to a distant city. Just cheap and short sighted, except BlackRock and Fidelity.
Full disclosure, I and not saying Schwab is any worse than most of the industry, most financial firms are doing this, just that BlackRock and Fidelity are doing it better than most. I have no problem buying a Schwab index fund and could even consider an account there if I was not getting what I needed at Vanguard or Fidelity, but it is a distant 3rd choice for next few years while they ingest these changes underway. Every time I drive by a Fidelity branch I think “maybe I should move”. Not when I pass a Schwab branch. But I did start buying ishares, Schwab ETFs instead of being 100% Vanguard as I once was. But the functions to operate these funds are more isolated and not complex for the limited set of funds managed by Schwab Asset Management.