3 Strategies to Attract and Retain Talent in Financial Services
In the past few weeks we have been dealing with the challenge of talent acquisition in the rapidly changing financial services sector. The following article examines three key strategies than can help deal with this challenge.
3 Strategies to Attract and Retain Talent in Financial Services
The financial services industry has undergone a number of changes. It has been impacted by advances in technology as well as disruptors that are changing the way financial services and related products are delivered. Rising competition among banks and other institutions as well as the rapid growth of financial technology, such as peer-to-peer lending, trading apps, and online personal finance management, make it challenging to attract and retain talent in financial services. In fact, in one survey, 88 percent of financial services leaders said their business was at risk due to the rise of financial technology innovations in the industry.
There is also a widening talent gap that makes it more difficult for financial services firms to find and keep talent. In a Bullhorn survey of recruiters and financial services business leaders, 73 percent reported a significant shortage of skilled talent for key roles. Within a rapidly changing industry, a talent shortage only makes it more challenging to design and deliver successful talent management programs. However, many of these challenges can be overcome with three key strategies that help to attract and retain talent.
1. Build a people centric culture.
No matter the industry, company culture matters, and it can impact a company’s ability to not only attract, but also retain talent. Company culture dictates how teams work together to innovate, and it also impacts the degree to which the organization manages change. When you build a culture where people embrace change and focus on continuous improvement, high performance is the result. And a high-performance culture helps to attract and retain top performing talent.
Having a people centric culture relies on leaders who can help individuals develop the required mindset and behaviors needed for long-term success. Leaders can support the development of a positive culture by:
- Supporting employee learning and development so that individuals can perform to their potential
- Setting the bar for high performance and leading by example
- Ensuring clear and frequent communication around important objectives
- Coaching individuals for performance improvement
- Recognizing and rewarding individuals whose behaviors support key goals and initiatives
For financial services organizations in particular, perceptions about company culture are impacted by the actions of industry players and the reputation they’ve built. When there’s an economic downturn or boom, banks and other financial institutions are often front and center. You can take steps to build a strong culture and reputation by undertaking a culture transformation that allows you to take a critical look at your culture and examine what’s working and what areas of improvement there are. Another way to support the development of a healthy people centric culture is by specifically seeking out and recruiting leaders and other key hires who personify the cultural values that are important to the organization.
2. Provide development opportunities.
Perhaps now more than ever, financial services firms need individuals that possess the optimal mix of skills and knowledge to help their company grow and compete. In many cases, however, individuals don’t possess the necessary skills to succeed in financial services today. In their recent report on the future of talent in banking, the Bank Governance Leadership Network says that changes in financial services such as new technology and competition with disruptors will require significant retraining of staff. One company in the report noted they would need to retrain 60-70 percent of their workforce as a result of these changes.
It’s clear that some of the required training will be job-focused, but financial services employees will also need training in soft skills. Communication, teamwork, and process improvement, to name a few, are skills that are critical to the innovation and growth that companies in the financial services industry require. Other training that financial services professionals will benefit from includes:
- Leadership development – Developing financial services leaders who can build and lead high-performance teams
- Change management – Training individuals to lead teams that embrace change
- Customer centricity – Helping individuals understand how their actions impact the customer journey
There are also developmental opportunities that complement training. Job rotations, stretch assignments, and participation on task forces and other projects can all provide opportunities for employees to learn and master new processes, interact with a broader spectrum of individuals and teams, and develop a new perspective and awareness about their role in the organization.
3. Create a 21st-century employee experience.
Today’s employees are interested in more than a big salary. In addition to competitive compensation and benefits, they prefer job characteristics typically associated with technology unicorns and startups: innovative work, plentiful developmental opportunities, and flexibility that allows for a strong work-life balance. As a result, millennials and other talent have begun to flock to tech companies in greater numbers than to financial services. According to an article in the Financial Times, in an almost complete role reversal over the last ten years, tech firms now out-recruit financial institutions at the top U.S. business schools.
To attract and retain talent, financial services firms will need to offer the benefits and perks candidates and employees value most. You can provide a 21st-century employee experience by providing candidates and existing employees with the following:
Opportunities to build their digital skill set
According to PWC’s 2018 Tech at Work study, 73 percent of more than 12,000 surveyed employees from around the world said that they know of digital systems that would help them be more productive at work. Those surveyed who work in the financial services industry said they’d be willing to dedicate 18 hours a month to digital skills training. Given the level of employee commitment to developing a digital skill set, offering those opportunities can go a long way toward attracting individuals who will help your organization succeed in the digital future.
In addition, millennials, already a large portion of today’s workforce, are digital natives with the desire to use digital tools in the workplace. In a SurveyMonkey poll of millennial workers, 93 percent said having up-to-date technology was one of the most important aspects of the workplace. Financial services organizations can build digital competency in the workforce by not only recruiting millennials, but also continuing to provide engaging work experiences and training that will expand upon their digital skill set.
Opportunities for career growth and mobility
In addition to opportunities to develop their digital skills, many in today’s workforce value stretch assignments, job rotations, and other experiences that give them a more in-depth understanding of the organization and their role. As an example, a study of millennials in financial services found that 72 percent expect and want to complete an overseas assignment during their career, which can provide a valuable competitive advantage for organizations who need to compete globally.
Flexibility and purpose
In the past, many in financial services have worked long hours, and this remains true today. When people think about investment banking, for example, the vision of individuals in the office well into the night to close a mammoth M&A deal comes to mind. In some cases, individuals are expected to continue working until the deal is done. Though the need to be available doesn’t go away, the changing nature of work means that individuals in financial services, as in other industries, can and want to work with greater flexibility. In an eFinancialCareers survey of financial services professionals, the option of working from home was ranked high on the list of non-compensation benefits employees wanted from their employer. Even as individuals are willing to do the work and put in the hours, they place value on having flexibility in where and how they do their work.
Today’s employees also want to feel that what they do serves a larger purpose. There is evidence that a strong sense of company purpose can help individuals be more satisfied and productive at work. According to a study by Mercer, thriving employees are three times more likely to work for a company with a strong sense of purpose. A well-communicated purpose built into your culture can help you to attract and retain the sort of individuals who are more likely to support your organizational goals.
Attract and retain your desired workforce.
Financial services, like many other industries, is impacted by a changing business and customer landscape, which presents new challenges for attracting and retaining talent. New market entrants and the growth of financial technology, combined with a shortage of digitally minded financial services talent, requires a shift in talent management strategy and a focus on company culture and the employee experience.
There is also the reality that banks and lenders are often on the front lines in good economic times and bad. Because of this and the unique skill set required to be successful in financial services, banks and other financial institutions must build a strong reputation and a highly skilled corps of motivated employees. By hiring and developing people who can help the organization successfully innovate, and by establishing a culture that people want to be a part of, you can make big strides in building a high performing workforce.