Investment firms from Paris to Geneva
How one institution has over 5x the assets to manage but only double the staff.
Previously, I analysed the differences in workforce between investment firms in Europe and the Middle East — today I’m comparing two in Europe. This blog explores how one company is managing over five times more assets than the other, but only has over double the employee headcount.
Comparing two global institutions in Europe highlights the differences in human capital between two fairly culturally similar companies and countries. ODDO BHF and Pictet Group are investment, asset management and banking firms, based in Paris and Geneva respectively. Both companies have a worldwide audience and reach. Pictet has 698 billion CHF (687.5 billion EUR) in assets under management and is larger than ODDO who has 125 billion EUR in assets under management.
What is immediately noticeable is the difference in company size. Pictet has almost double the number of employees compared to ODDO. This is unsurprising given that Pictet is larger, however, Pictet manages nearly 5.5 times the volume of assets under management so why is their workforce not 5 times larger? What people and skills have they invested in that means they can manage a larger number of assets with a smaller staff?
The first answer is to look at experience. Pictet employees have on average 15.6 years of experience, compared to ODDO’s 12 year average. Over 70% of Pictet’s workforce has more than 15 years of experience. This shows Pictet hires the most experienced and knowledgeable employees in the industry. What’s more is that Pictet doesn’t hire as many inexperienced employees as ODDO. 13% of all ODDO employees have under 3 years of experience, compared to 3.9% at Pictet. Again this shows that whilst Pictet might be hiring new employees or graduates, they do so extremely selectively. This may explain the lack of proportional employee with asset under management growth. Pictet looks to employ only the most experienced of selected graduates whereas ODDO has a slightly different hiring policy. This is definitely not a bad thing, ODDO is hiring younger and more “inexperienced” employees and getting them into the workforce — this requires more people to train and mentor young employees.
Osterus’ software looks into hundreds of data points to analyse and assess patterns between companies in order to find similarities and potential irregularities. We can then interpret these signals and suggest what they mean in the context of the industry. This enables Osterus to build score cards for companies and benchmark them against each other and the industry in general.
In general here we see both companies are male dominated — this will not come to a surprise to those who have worked in finance before! Over 65% of the workforce is male compared to 35% female. This statistic shows that both firms have the opportunity to diversify their workforces and get more women into roles in their companies.
This is specifically true when looking at the most experienced employees (15+ years of experience). These employees tend to be higher ranking owing to their experience — therefore a lack of women here suggests a lack of women in leadership/senior positions. ODDO has just 8.3% of its 15+ year workforce identifying as female, compared to 23.4% that identify as men. That’s around a 4:13 ratio. Pictet has 13.3% identifying as female in the same group with 35.7% identifying as male. That means nearly 3 times the amount of men are in this group than women.
When examining the workforce of Oddo Bhf, we realise that 22.5% of their employees are finance professionals, vs. Pictet, which has 12.1% of finance experts.
Both companies have a very similar percentage, when it comes to software developers and data scientists, Oddo’s workforce represents roughly 10.6% vs. Pictet 10% of their employees within those domains.
The Previous Companies data for Oddo shows that the highest percentage of employees come from banking and investment environments (Deutsche Bank, Commerzbank Ag, BNP Paribas, Société Générale), as does Pictet’s (UBS, Credit Suisse, J.P. Morgan, Deutsche Bank, Société Générale,), with both companies hiring employees with similar backgrounds. One of the noticeable differences is also Current Job Work Experience (Oddo 4.3yrs and Pictet 5.9 yrs), which could indicate that Pictet does a better job at retaining its employees, and keeping the turnover rate low, while Oddo’s slightly lower score could be the result of recent scaling or higher percentage of interns amongst their workforce.
In terms of education, both Oddo and Pictet employees predominantly have Master’s and Bachelor’s Degrees, with Pictet having a higher percentage of employees with PhDs.
Their average education length averages around 6 years. The most attended Universities for Oddo are: EDHEC Business School, ESSEC Business School, EMLYON Business School University of Giessen and University of Münster. The most attended Universities for Pictet are: University of Geneva, University of Zurich, EDHEC Business School, SKEMA Business School and ESCP Business School.
In this case, Osterus was used to pinpoint crucial workforce metrics behind two influential investment banks on the European market. In no time at all, we can even go a few steps beyond with another meticulous look at additional company data. We can:
- Benchmark the workforce against the competition
- Access deep insights into vital urban areas to examine quality of life and cost of living
- Analyze company workforces to spot potential irregularities during the due-diligence process
That’s only a smidge of what’s possible.