Other parts of this series:
While culture has always played an important role in talent retention at banks, it hasn’t always received the focus and investment it deserves.
But as the Great Resignation unfolds and record-breaking numbers of Americans continue to leave their jobs, and as the demand for talent (especially digital talent) in banking intensifies, the need to modernize organizational culture at many banks is becoming impossible to ignore.
As we’ve seen in previous posts in this series, most banks have substantial work to do in this area. Research from Accenture Organizational Analytics shows that banking, as an industry, trails most others on key elements of organizational culture. These include supporting experimentation and the rapid testing of new ideas; mutual respect and collaboration; creativity and learning from mistakes; and responding quickly to changes.
Of course, no bank leader sets out to foster a culture
that hinders innovation and doesn’t encourage employees
to stick around. Yet too often, this is just what happens.
Our Organizational Analytics team used AI to analyze over 485,000 online comments from current and former employees of organizations from many industries, including financial services. Their work highlights how culture can magnify a bank’s strengths or dull its competitive edge.
Drawn from their research, there are five organizational culture changes banks should consider if they want to attract and retain the talent they need to remain competitive.
1. Carefully dismantle some hierarchy
As a highly regulated industry, with some companies’ roots reaching back over a hundred years, banking has a well-earned reputation for being hierarchical. And to be clear, some degree of hierarchy is necessary for banks to function.
But at many banks this goes too far. Workers today generally want more flexibility, trust, and self-determination from their employer. Most prize collaboration and resist micromanagement. This is antithetical to hierarchy.
Too much hierarchy also hamstrings banks by constraining agility and stifling innovation, and making employees feel that they are not appreciated or encouraged to bring their best selves to work. It’s one reason just 10% of Gen Z and millennials are interested in working in finance.
2. Encourage more risk taking, experimentation and learning
Our research has found that employee retention in banking is strongly linked to empowering employees to experiment, to try things that might not work out, and to learn continuously. Yet banking, in the analysis mentioned above, scores lower than the cross-industry average for creativity, testing new ideas, and responding quickly to changes.
The regulated nature of banking can make fostering innovation and smart risk-taking a challenge, but the successes of many leading banks and fintechs suggest these hurdles are not insurmountable.
3. Spend more time building trust
Organizational trust is a two-way street, especially in a world where organizational agility and flexibility are crucial to competing. Leaders can build a foundation of trust by addressing employees’ needs for psychological and physical safety.
Yet banking overall scored below the cross-industry average in the research mentioned above for employee trust in leadership. Likewise, banking scored the lowest of all industries in our team’s study when it comes to treating colleagues with respect and listening to the opinions of others.
Trust is simple to build, in theory, but it cannot be faked and there are no shortcuts to it. The crucial ingredients are leaders treating people with respect, spending time with them, and acting with transparency.
4. Invest more in the employee experience
One of the pandemic’s biggest impacts on work is how it changed the expectations of current and prospective employees. Our report, Care to do Better: Building Trust to Leave Your People and Your Business Net Better Off, surveyed both bank workers and leaders to measure today’s expectations of the employee-employer relationship.
It found that, pre-pandemic, 67% of the banking workforce strongly believed that their employer should help them become net better off—that is, meet all of their fundamental needs instead of simply offering a paycheck. But only 30% of C-suite leaders felt the same way. During the crisis, these figures changed to 78% and 50%, respectively.
The research also found that leaders have a narrower view of how to recognize employees. They focus on rewards, learning opportunities, and employability. Most employees see things differently and have a more expansive expectations of employer responsibilities that include areas such as mental health and wellbeing.
A truly superior employee experience will include every part of wellbeing, from the physical to the emotional to the relational. It will also provide employees with a sense of purpose and help them become lifelong learners.
5. Build organizational agility
Research from Accenture Organizational Analytics has also found a strong link between employee retention and the ability of banks to sense and quickly respond to changes in the marketplace. This makes sense, as star employees are less likely to be tempted away by the “next big thing” if the next big thing is generating excitement at their current employer.
Identifying the stumbling blocks behind these five recommended changes is the first step to avoiding them. And that’s essential for any bank looking to improve its culture to attract and retain the talent it needs to thrive in tomorrow’s marketplace.
The final post in this series will present some more key insights on creating a workplace culture that attracts and retains top-tier talent.
Dive into the details of our latest Future of Work report, or contact me here to learn more about how to transform your bank’s culture into a talent magnet.
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