Other parts of this series:
In this blog series we’ve looked at the findings of Accenture’s research into workplace culture at banks. Workplace culture is a major reason why most banks right now are struggling to attract and retain the talent they need.
The situation could be described as a crisis—and a crisis is no time for staying the course.
In that spirit, we’re going to wrap up the series with a different format. The following Q&A is a condensed version of an interview I recently gave about the situation banks face today and the choices they must make.
1. The struggle for talent in banking is nothing new. What’s given it new urgency and depth?
First, the workplace has changed dramatically following the pandemic. COVID accelerated many trends and changed the workplace forever.
Next, you’ll have heard about the Great Resignation. Attrition levels have gone up for nine straight months, and there are more than 11 million vacancies in the marketplace. The talent shortage is more acute now than it’s been in a very long time, so you must love and care for the people you have.
The third issue driving talent as a priority is technology. When I look at banks, they are rapidly moving along the adoption curve for cloud and emerging technologies, for example. For cloud technology to be effective and for banks to realize the expected return on their investment, they need to invest also in the people aspects that drive cloud. This means that banks need to retrain their people in cloud technology and create cultures of continuous learning. This enables technology professionals to make the switch from mainframe to the cloud.
2. Would it help for banks to become less hierarchical? And if so, how should they approach this?
There’s enough research and case studies to show that getting rid of all hierarchy isn’t wise, especially for large, regulated organizations like banks. But a lot of our thinking on the topic comes from the military and Taylorism—and they’ve been outdated for a very long time.
In 2022, we still need to know overall who is accountable and in charge. We still need leaders. But do we need 10 or 15 levels between the CEO and the bank’s early career and frontline associates? I think all that is breaking down. One reason is that young people entering the workforce don’t just want flexibility in terms of where they work but also what they work on and how they work on it.
Banks need to look at the grading systems and hierarchy that were put in place decades ago and ask if they’re fit for purpose in today’s world. We’ve seen time and again that trust is a big element of culture and of people choosing to leave or stay. The more hierarchy you have, the more control you need because there’s less trust. Organizations can benefit from thinking about how they build or break down trust.
A bank can start by considering which roles and skills really matter. Every skill has a shelf life, and research shows they’re declining. Think about career systems that are more skills-based: what someone can do and what they can learn to do, versus what they are responsible for.
3. To what extent can higher wages and recruitment solve the problem?
If we look at wages, retention packages are often used in times of business disruption when there’s a talent shortage. They work, but they create a false sense of security when organizations expect people to stay simply because of retention packages. As soon as you take them off, people move on. The packages also need to be meaningful, possibly six months’ pay or more to make them effective, and that’s expensive.
You might also give an employee a pay increase if they have another offer, and it might renew their motivation for a while, but a few weeks after that they are still in the same environment they were thinking of leaving in the first place. So, higher wages can be a short-term answer but an expensive one.
Our research shows that most people aren’t leaving for money. They may be paid more in a new position, but they are leaving because they are looking for a better opportunity—one with more flexibility, more development, that takes them in a direction they want to go.
As for hiring, the challenge is you don’t know how long it’s going to take. With new technologies such as cloud there is an acute shortage of talent. You could spend eight months or more finding someone and successfully onboarding them into the organization. New hires also need to adjust to the culture and achieve a certain level of institutional knowledge to be at their most productive.
And that assumes you can find someone with the right skills to hire in the first place. A recent survey of banking leaders, commissioned for our Banking Cloud Altimeter publication , found that cloud and cybersecurity are the most in-demand technical skills across all of banking right now.
It’s easier and faster to take your current people and offer them the development and skills that they need.
In the final post in this series, we’ll answer four more burning questions about the culture crisis—starting with how to begin investing in a superior employee experience.
If you’d like to discuss workplace culture in banking today, I would love to hear from you. I can be reached here.
You can also learn more about the changing nature of work in Accenture’s The Future of Work—Productive Anywhere report:Read Report