Heading into November, the United States’ unemployment rate stood at 3.8 percent. While that low number signifies a strong economy, it also creates implications for financial services organizations as they look to hire employees. In contracting labor markets, financial services leaders tend to emphasize retention because the pool of available talent has diminished. Yet employees may feel like exploring the added opportunities to change employers or careers since many companies need to fill vacancies. Additionally, financial services organizations no longer compete with their peers alone: They must deal with competitors from early-stage fintechs to corporate giants such as Amazon. To best retain top talent, financial services leaders need to consider various factors.
Earlier this year, the BAI Banking Outlook research program surveyed nearly 600 industry leaders, including human resource professionals and employees of financial services organizations that ranged in size from community banks to mega banks. The goal was to uncover the top trends in talent management and beyond this, I’ve had the opportunity to engage with talent management professionals in the financial services industry through BAI’s executive roundtables and the BAI Talent Management Benchmarking program. Based on those sources, we’ve identified four keys to attracting talent in 2019.
Update the candidate experience
It can be easy, especially in the context of attracting new employees, to follow the same model and expect the same results. Consider the act of applying for a job at your organization. It is often a time-consuming, repetitive process. Many applications require candidates to summarize their previous work experience, then upload a resume and cover letter separately; they tend to be user-unfriendly. Many online applications aren’t mobile or tablet compatible, either. In financial services, providing an omnichannel experience remains top of mind in terms of customer service and product-related channels. So why should the candidate experience be any different? Financial services leaders should review the current application process and how it compares to fintechs, internet companies and online retailers—and find innovative ways to make it easy for people to apply for positions with your organization. Candidates often treat the application experience as a precursor to the work environment. A clunky or disjointed experience may disenchant strong candidates before they even decide to enter the hiring pipeline.
Consider “non-traditional” candidates
A contracting labor market makes it important to look outside the traditional talent pool. A candidate’s best experience may not come from working at another financial services organization and frontline roles operate in a number of ways. The typical characteristics of strong employees in this role involve:
- knowledge of the organization and its products
- thinking quickly
- problem solving on the spot
- providing excellent customer service, and
- complying with regulatory requirements in all activities.
Internal training usually covers compliance, history and expectations of the organization, and the products and services offered. Traditionally, finding someone with this background produced a net savings for the organization vis-à-vis training time and investment. But exemplary customer service and quick thinking transfer well from the retail, restaurant and hospitality industries; they define customer experience in crucial ways. Keep this differentiator in mind when you review potential candidates and the diverse range of transferable skills and fresh perspectives they can bring to the organization.
Offer a total benefits package
Traditionally, benefits packages have focused on criteria such as retirement benefits, vacation time, parental and family leave options, health insurance and more recently, flexible working hours. Yet over time these benefits have become table stakes and as a result, do not necessarily differentiate employers. BAI Banking Outlook findings show that career development, leadership programs and proper training are keys to employee retention and engagement. These programs not only benefit current employees but also represent attractive offerings to potential candidates. They can also create tangible benefits for organizations. A commitment to investing in and developing employees can lead to content, capable and engaged workers more likely to stay—and more apt to recommend new talent. BAI research also shows that employee referrals are one of the highest quality sources of new employees and one of the lowest cost overall.
While candidates treat career development, leadership programs and proper training as important differentiators, financial services leaders may worry that after investing time and money into developing their workforce, these newly developed employees will leave. Instead of fixating on “what if,” financial services leaders should concentrate on training people without fear of them leaving. Talk to people about career and life aspirations; find unique ways to help them achieve their goals. Provide opportunities to help people develop skills to meet their long-term goals. Remember that these are people, not just employees.
Different generations value different things
By 2020, millennials will make up almost half of the United States workforce. Surprisingly, many companies—financial services organizations in particular—have struggled to establish strong relationships with millennials in the same way they have with baby boomers and Generation X. Several factors play into this dilemma.
According to BAI research, the longer someone stays at an organization the more likely they are to experience dissatisfaction with their career advancement opportunities, which often leads to disengagement. And generationally speaking, millennials have a greater desire to grasp their context or meaning within the organization.
Financial services leaders must constantly reassess what mobility looks like within the organization:
- Do you encourage employees to develop a versatile skill set?
- Does the organization provide training opportunities to help employees become leaders?
- Are there opportunities for employees, especially those early in their career, to try new roles within the organization?
Millennials ask themselves these types of questions and financial services leaders ask them of their organizations.
Consider a rotational program that allows an employee to spend three to six months in a position, then rotate to a new one. Though no longer a common practice in the industry, it can easily enable employees to try new things and find their best fit. It can also help leaders identify areas where employees have high potential, which helps employees and leaders envision a robust career path. Rotational programs may help diminish feelings of being stifled or stuck in a position, and open new doors and career opportunities.
Additionally, rotational programs will provide a broader view and understanding of your organization and how it operates. This deepens engagement and is important to your future leaders. Last, moving through the organization provides workers a chance to build the networks, both formal and informal, that play a critical role in job effectiveness and career success.
Putting it all together: It’s all about people
Financial services leaders often say employees represent their greatest asset and key differentiator. But leaders may feel apprehension about taking the right steps to take their business to the next level. Invest in new technology and ways to approach talent management. Think about candidate experience or emphasize transferable skills. Encourage leaders to cultivate and demonstrate genuine interest in developing their employees through leadership and professional development programs and thus make people feel valued. Finally, consider that different generations have different expectations and what works for one may not work for another. People make each organization different. Investing in your recruitment and talent management efforts will yield engaged, dedicated employees: the building blocks of engaged, dedicated and profitable organizations.
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Byron Marshall is director of research at BAI.