How Banks Can Attract Young Talent

The introduction of AI and digital technology has “forced banks to realize that human connection is what will set them apart and give them an edge. You can use all the technology you want but without the right people to deliver it, manage it, and embrace those changes, you will fail.”¹ Collaboration, empathy, creativity-- all of these new things are humanistic by nature.

According to Penny Crossman of American Banker magazine, banks and other financial institutions often anecdotally mention they have trouble attracting new talent. They’re not getting the top developers or the best graduates at top schools. With “the digital generation” coming of age and entering the workforce, we’re seeing a much more diverse group with different career goals than previous generations.

In the wake of digital banking, banks are no longer just seeking people with finance degrees. They need to broaden their talent to include engineering, design, and other innovation. However, these people have very different personalities than finance majors. You’ll need different approaches to reach these diverse groups.

Aside from methods of talent acquisition, banks must change what they have to offer in order to compete for this talent. Consider your physical workplace. Consultants from Capco, a global business and technology management consultancy firm, relent that the finance field follows a traditional evolution of growth: cube, to slightly bigger cube, to slightly bigger cube, to a shared office, to standalone office, to corner office. However, the digital workforce of today thinks in much more collaborative terms. They want models that look more like shops and factories with pods, open spaces, fluid seating arrangements, and places where people can sit across from each other and have conversations. Something these consultants have noticed about newer generations is that they have much more collectivistic desires than older generations which are more individualistic. The under-30 ratio of entrepreneurs is down by two-thirds since the early nineties. Of course, there are many factors contributing to this number, but they believe it is in part due to a desire for people to work together.

Secondly, they urge that you understand the value that you offer to employees. Previously, financial institutions could ride on the appeal of being a good career path and solid employer, but younger generations need more out of their career than that. Recruiters that lead with the purpose of the company and the way a company does things see the most success. These younger generations care about team, environment, flexibility, becoming a better version of themselves. They need to get personal gain and growth from their career. It’s common to hear that their biggest motivator is how interesting the work is. Of course they want to be dependable employees and do good work, but they also want to get something out of their day-to-day tasks. Providing interesting work and stimulation is a must. This can be done from working with different teams, in different environments, different clients, or just a variety of problems that they work on.

It might be a challenge for people to see their work as meaningful when the job isn’t necessarily world-changing or lifesaving, when the jobs look more like crunching numbers and creating spreadsheets. This loops back around to defining value-- understanding the purpose and mission of your company. One consultant pointed out that “one of the positive outcomes of the financial crisis has been [the] epiphany for banks to look at their role in the community. Large banks have been redefining who they are and their mission for a while now. Purposeful companies see an uplift in profits.” All financial institutions have purpose and serve their communities, “it has to do with enabling people to fully develop their life’s aspirations,”¹ whether it be college, retirement, buying your dream house, or starting a business. All people working in the financial institution drive this purpose and are contributing to the greater good across the industry.

Aside from acquiring talent, banks must also think about how to retain it and grow it. The way performance is managed is typically by feedback. It’s a transactional approach—employer gives you a set of objectives to meet. This approach to success is not in sync with newer generations. This system is centered around what you do as a person. It’s isolating and doesn’t promote teamwork, collaboration, or trust. So naturally, if you switch to a more team-oriented and collaborative work environment, this type of performance review will also need to be reconfigured.

Banks have also been competing for talent with fintechs and startups in more recent years. These younger generations will accept lower offers from a job that has more interesting work, a better environment, culture, or if they just like the people they meet. It’s no longer just about money. Banks do have an edge against these companies though—they are established and mature companies, there’s much more job security and less risk. And while the managers and leaders may not be as cool or exciting, banks often hold better managers. Many times these smaller companies fail to develop proper leaders, as you’ll find people doing multiple jobs at once. Established companies, like banks, offer more stability and structure. Banks have many advantages they may not have realized. It’s all about realizing your value, your purpose, and relaying that to potential employees.

Don’t get so caught up in integrating digital technology that you forget human connections are what will set you apart. No matter how much technology you integrate, if you do not have the right people to create it, manage it, and embrace it, you will fail.

Source:

1. Penny Crossman, Guido Tamburini, Nic Parmaksizian. “It’s Not Just About Money: How Banks Can Attract Young Coders”. American Banker. American Banker. 12 Sept 2018. Retrieved from Apple Podcasts.