October 10, 2023

Financial Services’ Traditional Approach to Talent Is an Obstacle to Transformation

Financial Services’ Traditional Approach to Talent Is an Obstacle to Transformation

The financial-services industry, like so many others, is under pressure to transform. The myriad reasons include the rise of new, agile fintechs and challenger banks; the digital movement symbolized by the shift from bank-branches to online banking; “fierce” competition with tech companies for tech workers; and the need for greater security and fraud prevention.

Biggest Challenges  

The talent shortage is the top challenge for financial-services executives.

For banks, some of the most sought-after talent include developers, solutions architects, data scientists, and data analysts. Not far behind that: fraud analyst, risk-management, and other niche roles unique to the industry. Customer-service associates and client experience reps are also in demand.  

For insurers, claims analysts/managers are always critical; organizations cannot build talent pipelines of claims professionals fast enough to meet demand. Underwriting managers, too, are critical. Like banks, customer service/experience associates at multiple levels can be hard to find and sometimes harder to keep.  

Of course, all this depends on the organization. CBOE Global Markets, to take one example, is most in need of people with an understanding of options, futures, derivatives, crypto, and high-speed trading technologies. “We don’t hire a lot of early career talent because the skills are hard to teach,” VP of Talent Acquisition Crystal Stanfield tells me. “We have an Options Institute to support ongoing skills development, but you need a foundation coming in.”  

All of the above is a challenge for an industry with historically linear career paths and a lack of knowledge of the skills of its own workforces. Think of it this way: it’s hard to reskill 30 people for cybersecurity or fraud-prevention (see “Financial Crime Prevention” case study) jobs if you don’t know who has what skills; who has adjacent skills; and what the gaps are between their skills and what they need to know.

Where to Start

Banks, insurers, and other financial-services organizations looking to change their approach and stay competitive need to move to a skills-based, not jobs-based mindset.  

The change in approach requires a culture change in an organization and won’t happen overnight. We’ve seen organizations like Gainwell succeed in this ... and we’ve seen early attempts at it that have not worked.

The method we’ve seen work best has four parts. We suggest you start with the first two parts, which involve asking yourself what skills your organization needs, and what skills your organization has. This should be done for your total workforce, including contingent workers.

Without the answers to those questions (What skills do you need? What skills do you have?), you don't know what skills your bank teller lacks in order to be more consultative. You don’t know who’s most ripe for reskilling into a cybersecurity role. You don’t know which of your employees has data-science skills, because they very well may not have the words “data science” in their job title.  

We’re working with multiple large financial-services companies to help them answer those questions, and make sure they stay competitive given the challenges we laid out in the very beginning of this post. Let us know if you want to talk about how you can do the same.

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