Onboarding in a Digital Era: Bridging the Gaps
Firms are planning for a digital future, when the world of work will be unpredictable. While many see the implementation of new technologies as a vital competitive advantage, we believe people make the real difference.
‘Digital technologies provide huge possibilities for efficiency gains and customer intimacy. But if people lack the right mindset to change and the current organizational practices are flawed, digital transformation will simply magnify those flaws.’[i] (HBR,2019)
Last year alone, over $1.3 trillion was spent on digital transformation initiatives but it’s estimated that up to 70% was wasted.[ii] With investment in new technologies expected to grow exponentially over the coming years, the price paid by firms for failing to keep its people strategy in step with its tech strategy should not be overstated.
While the reskilling of existing staff represents the largest immediate obstacle to overcome, the methods by which firms approach new talent acquisition will have a major bearing on whether their existing culture and practices are reinforced or superseded in the coming years.
Financial firms have long held a monopoly over the recruitment of the best and brightest at source. The prestige of Wall Street or the City coupled with high wages has for generations lured Oxbridge and Ivy League graduates. Today, the landscape has changed, and banking attraction and retention rates are suffering more than any time in living memory.
“In 2017, just 9.6% of London School of Economics graduates applied for roles in investment banking, compared to 41% in 2012.”[iii]
Even after fending off competition for recruits, the reality of 100-hour weeks and prescriptive career tracks means graduates are finding themselves drawn to alternative sectors such as technology or Fintech.
So, how can banks get back to the top of the pile?
Broadly speaking, we believe it comes down to an acceptance of a new reality and a determination to bridge the gaps that are at the root of the problem.
We examine three of these disconnects below and discuss what firms need to do to recalibrate.
- Disconnect between Graduates and Employers
- Disconnect between University and Corporates
- Disconnect between Short-Term and Long-Term
Graduates and Employers
Everyone has nightmares about turning up for the first day of a new job to find out you’re in the wrong building. Feeling like you’re at the wrong company can be a lot worse.
People quickly form opinions about the company they have joined. In fact, 90% of new employees decide to stay in or leave within their first six months.[iv]
Most of the reasons for leaving stem from a misalignment between what the employee was expecting and the reality of life at the company. The effect is even more pronounced for millennials and Gen Z who are, more so than any previous generation, seeking more than just a paycheck.
It goes without saying that being left isolated and feeling neglected in a strange environment is not going to win over any new recruits but for banks in particular, ensuring recruits buy into your mission and culture carries even more importance in the face of competition from the world’s most admired companies – namely Apple, Google, Amazon, and Facebook.
For these reasons, it is crucial that the onboarding process for new hires is not only a positive experience, but one that creates a sense of belonging and dispels the myth that working at a bank and making a valuable contribution to society have to trade off.
University and Corporates
Creating an inclusive culture can ensure you have the best shot at keeping talent beyond the first 90 days, but they won’t last long without the right skills needed to be productive.
40% of employers say a lack of skills is the main reason for entry-level job vacancies, and the same study suggested that as many as 60% of new graduates are ill-prepared to do their job efficiently. [v]
There is much finger-pointing between firms and universities about who exactly is to blame for a widening gap between campus and corporate life. With the shelf-life of university-acquired skills now reduced to just five years, there are real questions being asked about the validity of some university degrees, not just from debt-ridden students but also from employers.
The traditional trajectory of school > university > job was once able to sustain both employer and employee for long periods of time, but the digitally induced dwindling lifespan of ‘hard’ skills means more agile models and more agile personnel are necessary to keep pace with change.
In the future, banks will be increasingly reliant on a core of permanent personnel who will not only need the hard skills to perform in their role but the broader soft skills necessary to effect change. On the flipside, it means that banks will increasingly need to get better at training specialised, and often contracted, staff more quickly and more often.
While this has led to a growing proliferation of outsourcing and resourcing companies lining up to sell skilled personnel to banks on a short-term basis, it doesn’t relieve banks of their responsibility to ensure staff are trained to the standards required for growth.
This means banks must get better at prioritising investment in different areas and on different skills. In the digital era, sheep-dipping must go the way of the dodo.
Short-Term and Long-Term
Since the dawn of time, firms have tried to strike the right balance between growth and profitability but in the past ten years, a singular approach to profitability has dominated the strategies of most financial institutions amid a weaker trading environment.
In the intervening decade as banks indulged in navel-gazing, star-gazing competitors have exploded onto the scene to steal market share and syphon off would-be banking talent all at once.
In a talent context, banks short-term focus has manifested itself in an emphasis on ‘desk-readiness’. As a result, graduate programmes have favoured shorter, more-intense bootcamps focused on drilling recruits for survival on the front line.
Unsurprisingly, army analogies have done nothing to dispel graduates perception of themselves as banking fodder. Gen Z, having grown up in the aftermath of the financial crisis, are more attuned to the impermanence of work than perhaps any other generation. As a result, they value lifelong learning and are attracted to firms who offer the opportunity to skill and reskill as standard.
94% of employees would stay at a company longer if firms invested in their development[vi]
Bootcamps might serve the business in the short term but if banks want to retain staff over the long haul, they will need to get better at outlining what career development looks like and what lifelong learning means beyond buzzwords.
The workforce is transforming, and we must consider how roles are being displaced and which roles will emerge as a critical priority for business.
Financial services firms are struggling to attract and retain quality candidates. Couple this with the pace of emerging skills gaps, and organisations are under enormous pressure. For digital transformation to be a success, firms must rethink talent as a strategic priority.
Onboarding is only one part of the equation, but it is a good place to start.
Download our backpack to briefcase guide to ease the transition to a new world of work.https://hbr.org/2019/03/digital-transformation-is-not-about-technology [ii] https://hbr.org/2019/03/digital-transformation-is-not-about-technology [iii] https://news.efinancialcareers.com/uk-en/289796/brexit-graduate-programmes [iv] https://www.shrm.org/resourcesandtools/hr-topics/talent-acquisition/pages/onboarding-key-retaining-engaging-talent.aspx [v] https://www.mckinsey.com/featured-insights/employment-and-growth/technology-jobs-and-the-future-of-work [vi] https://learning.linkedin.com/resources/workplace-learning-report-2018#