With pressure constantly growing on companies in the financial sector to make smarter hiring decisions, some firms are using real world-style contests to cast a wider net for skilled technology workers they might have missed on traditional campus recruiting tours.
One example is Interactive Brokers, a Greenwich, Conn.-based broker that competes with major investment banks and hedge funds, not to mention popular tech destinations like Yahoo!, Google and Microsoft to recruit software engineers who can design systems to give its traders and customers an edge.
Three years ago, Interactive Brokers cooked up a trading contest to widen its talent search, luring skilled contenders on college campuses with a $100,000 top prize. This year's winner, Chris Michalak, a Ph.D. candidate in mechanical engineering at the University of British Columbia, beat out 326 other contestants from North America, Europe and Asia with a high-risk, come-from-behind bet on the euro.
Unorthodox thinking is part of the firm's corporate culture, and the contest is designed to ferret out such prospective candidates. Interactive Brokers is best known for its fast and low-cost options trading systems, and, like other financial firms, it is constantly upgrading and developing new systems to keep up with fast-moving markets. As such, it needs a solid supply of fresh ideas from software designers.
Outlandish ideas get noticed, too. Michalak was in 171st place going into the final week. That's when his computer program kicked in. He had designed code to either buy or sell euros--not based on any market analysis, but rather on an algorithm using a randomly selected number between 1 and 0.
The way things worked out, his program made the order to buy euros: a well-timed bet considering the currency rose that week, and he netted $2.1 million in paper profit off the original $1 million sample account each contestant was given to trade.
Alenka Grealish of Celent says contests like this could be "a good r�sum� vacuum" because they tend to attract the sort of creative, self-starter applicants that traditional recruiting tests miss. Interactive's trading "Olympiad" requires contestants to submit a trading strategy and write a program that will execute it. This broadens the field to include software and computer science engineers from various backgrounds, not just grads with skills in the COBOL language.
Conventional technology recruiting examines an applicant's depth of knowledge, whereas a competition challenges them to demonstrate those skills, said Rodney Nelsesteun, a senior analyst at TowerGroup.
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