Retention of top talent at financial institutions, like any organization, is an important part of company strategy. However, today, it takes on a different slant as talented people are presented with both new opportunities and fewer options, depending on their specialization.
“While bloodletting will remain ongoing for a while as the industry continues to shake-out, retention of key personnel is of chief concern to banks at the moment,” notes James Kerr, president and managing partner, with Best Practices Enterprise Group, a Cromwell, Conn.-based consultancy. “There will likely be some hiring of technical ‘uber-specialists’ within some sectors, but, keeping essential personnel will be the challenge for the remainder of the year.”
Just as it’s easier and cheaper for banks to retain good customers rather than find new ones, the same is true with good employees. Craig Stephenson, global head of technology and operations across financial services with Los Angeles-based executive recruitment firm Korn/Ferry, says he has been spending a tremendous amount of time discussing this issue with his clients. “Engaged top talent is a great value to the organization and the cost is greatest if they are lost,” he says. “Top talent is a differentiator.”
Stephenson says talent retention takes on more urgency in an economic crisis since this is when the relationship between employee and employer is most vulnerable. “Banks are taking a focused effort here,” he explains. “In a transition period like this, sometimes retention bonds break. So you’ll want to engage your executives and top IT talent even more.”
This involves a consistent and common message to makes life easier for employees. He says this consistency of message is most vital to IT workers since they are often involved in most strategic initiatives in some manner.
Best Practices’ Kerr says the banking crisis has insulated most “job-hoppers” to a large degree. However, those in IT may find themselves faced with one of two scenarios. “The best and the brightest IT generalists always have the option of leaving for greener pastures,” he says. “But, hiring trends within the industry over the past few years have led to the stock-piling of IT banking specialists within most banks. These specialists don’t have as many options available to them. Consequently, they’re staying put because they don’t have anywhere else to go.”
Still, it will become more challenging for banks to hang on to those with marketable skills, says Andrew Curtis, director of customer service with Hazlet, N.J.-based iCIMS, a provider of HR talent management software. “If a company is not performing the way it once was, the talented people have more options. Even for companies not really looking to hire, if a good resume comes along that shows the person generates results, they’ll find some way to hire them.”
So how does a bank identify these people, keep them and get the most mileage out of them while they’re at it? The key is using techniques and technology that convey to employees their value to the larger organization and map out a clear career path for them for the future.
“Engaged top talent does not leave,” asserts Korn/Ferry’s Stephenson. “They are people who are focused and invested in the organization’s future, they’re willing to do more with less, and will go above and beyond their traditional job expectations. Those who can do this will thrive in the crisis.”
For Stephenson, employee engagement involves three elements: having the trust and respect of top management; allowing them to feel and observe their impact on the business; and giving them recognition. With this last component, monetary compensation is just a part of the picture. Stephenson says there are plenty of intangible, less costly ways to give employees positive reinforcement.
“Although compensation is important, there’s more to it,” he says. “There’s professional development, having a clear career path, being able to influence and make decisions, and having a sense of ownership.”
And as organizations begin to cut back on their budgets, it’s more important to be able to identify the key people quickly, notes iCIMS’ Curtis. “Every dollar is being scrutinized. If you can see who in the bank can handle more responsibility, there’s an opportunity for the organization to become more efficient. So banks can use performance management tools to see where someone’s strengths lie so that when conditions turn around in the market, they’ll be able to respond more rapidly.”
Use of performance management tools is definitely increasing, he says. “Over the last six months, I’ve really noticed things picking up around performance management tools among banks. They’re committing to investing in this process now so they’ll be ready when the market recovers,” Curtis relates.
For the most part, companies like banks are coming from a paper-based performance management process or one that might involve spreadsheets. Curtis says by moving this to a more automated, self-service process, banks can not only save money, but they can create a more dynamic means for evaluating employees. “These old methods had no interaction and they couldn’t keep up with changing company objectives,” he says. “If you move all these online, the information is more accessible and it becomes a living, breathing part of the work strategy.”
The performance management tools offered by iCIMS are designed to identify a company’s core objectives and then tie in measurable results of how individuals are meeting these objectives. This is measured against their goals to produce tangible ratings for the organization.
There is no doubt to Korn/Ferry’s Stephenson that banks need to do a better job measuring performance and productivity. He is seeing a growing understanding in the industry around these elements as banks look more at people who can align strategic goals with execution to get the most out of investments, especially in IT. Korn/Ferry’s Talent Management Architect product helps managers identify high potential talent and what must be done to engage these people. It provides analytics and reporting to help managers better define priorities and develop retention plans around these priorities. “It allows the firm to develop meaningful data they can move on and it lets employees feel like they’re being heard,” he says.
Identification and engagement are just the beginning. Banks must also find ways to keep people producing as well. Increasingly, banks are turning to collaboration tools to help do this. Wells Fargo’s technology and operations group (San Francisco; $1.3 trillion in assets) uses collaborative technologies as the foundation of workplace productivity. “We want to give our team members tools that will increase their opportunities to collaborate effectively, communicate efficiently and network successfully,” says Chris Bowman, VP and manager of enterprise messaging and collaboration at the bank.
Portals form the backbone of Wells Fargo’s strategy here. “Portals are a great way to increase productivity, allowing team members to easily share information and documents, while streamlining processes and workflow, all in one environment,” he explains. Among the tools Wells Fargo employs here are blogs, wikis and discussion boards.
Although Curtis says iCIMS doesn’t do quite as much work in the productivity management area, he has still seen a movement by companies toward collaboration tools, similar to what Wells Fargo does. “I’m seeing this more, especially in project management areas and in handling day-to-day tasks where the tools let you put work-in-progress into a shared environment. It gives people additional levels of feedback rather than their working in isolation,” he comments.
Instant messaging also plays a role at Wells Fargo as the company tries to encourage more immediate and conversational dialogue between employees, according to Bowman. “In today’s work environment, team members want answers fast—even more quickly than e-mail—and the speed of IM, along with the ability to see a team member’s presence [via away-messages], allows them to work more efficiently.”
The bank is also rolling out Microsoft’s SharePoint My Sites to allow team members to create an individual profile that includes their photo, role and skills, and allows them to connect with other team members across Wells Fargo’s virtual environment.
“The benefits of these profiles include increased productivity and greater efficiency. By expanding the pool of knowledge and sources, it makes it easy for team members to effectively locate, obtain and transfer knowledge,” Bowman explains. “Combined with communities of practice, team member resource groups and other internal community-based organizations, this has been a powerful formula for bringing the organization together to serve our customers.”
Tools such as those used by Wells Fargo are a perfect fit for the so-called Gen Y workforce, according to Best Practices’ Kerr. “Today’s Gen Y workforce is thirsty to embrace knowledge, extend their individual reach and establish an intimacy with the world they live and work in,” he says. “If banks want the most out of their people, they must make management systems that make sense to, and work for, the individual.”
iCIMS’ Curtis thinks companies that don’t invest in such technologies run a real risk of being left behind.
Adds Korn/Ferry’s Stephenson, “Technology is the most important lever to improve the performance of a business for the future. The increasing visibility of IT and its impact on the business continues to evolve, so there’s a bright future for tech folks. But organizations need to invest in their people. The last thing a bank wants once the crisis settles and hiring picks up is for good people to walk out because of how they were treated over the last 12 months.”