When my eldest son recently graduated from college, I was eager to leverage my multi-decade network of contacts to help him find a great first assignment in the financial-services industry. Much to my horror, he told me that a job in banking was on his “last resort” list. When I pressed him for a reason, he said: “Mom, the people my age who pursue jobs in banking do so because they need the safety of a role with lots of rules and procedures—and they measure their personal achievements by the size of their cubicles.”
As I pulled the emotional dagger out of my heart, I was even more discouraged to learn that my son’s sentiment is not an anomaly. Millennials, who will account for half the working population by 2020, are increasingly seeking opportunities in other industries. According to a recent Millennial Career Survey conducted by Hanover Research and the National Society of High School Scholars, or NSHSS, the top 25 companies most attractive to Millennials include consumer-product companies, such as 3M and Nike; healthcare companies, including St. Jude, Mayo Clinic and Blue Cross Blue Shield; tech companies, ranging from Google to Apple, Microsoft and Samsung; intelligence and law-enforcement agencies, including the FBI (Federal Bureau of Investigation), CIA (Central Intelligence Agency) and NSA (National Security Agency); and entertainment companies, such as The Walt Disney Company, Netflix and DreamWorks Animation. Not one financial-services company made the list.
Additionally, this year’s ranking of the 100 Best Jobs from U.S. News & World Report didn’t include any financial-services jobs in the top 35, with Financial Advisor coming in at 37. The ranking was determined by a number of factors deemed most important to both Millennial and female job-seekers and ranged from future job prospects to stress levels and work-life balance.
Why has this happened, and what has changed?
When I graduated from college, a job in banking was considered a plum assignment. I see three significant factors that have contributed to the financial-services industry’s cultural brand crisis:
The financial crisis and the heavy degree of regulation and legislative oversight that it led to over the past decade has created a heightened sense of formality and a lower tolerance for risk at banks. This regulatory response to the crisis also diverted investments from growth-oriented innovations for consumers and employees to compliance-related spending.
An emphasis on cost cutting during the past decade, in part due to my previous point, has deteriorated employees’ sense of organizational trust and loyalty, as well as their perception of career growth opportunities.
The slow progress in improving workforce diversity—particularly at top levels of banks—has contributed to higher attrition rates among women and minorities. Harvard Business Reviewreported recently that women occupy only 20 percent of executive-committee roles, 22 percent of board positions and 12 percent of CEO positions in financial services.
Many of these challenges have resulted in too much time playing defense and not enough time on offense. While heavy investment in programs that bolster compliance, fair treatment and ethical practices is important, balance is critical when you’re trying to foster a vibrant, dynamic and stimulating work environment that appeals to the top performers of tomorrow. So, how do we overcome the challenges of our past to position the banking industry as the forward-compatible and relevant employer of choice that it must become to compete effectively?
The answer is in a renewed, intentional focus on bank culture. Workplace culture is vitally important to incoming employees’ decision-making and success criteria. A recent study by Fidelity found that Millennials would accept a $7,600 annual pay cut, on average, if it led to a better workplace culture. Meanwhile, an Accenture study found that when the most important cultural factors are successfully addressed, women in the US are five times more likely to reach senior manager and director levels.
So, how do we get back on the cultural offensive?
The first step is to understand the attributes of a workplace culture that’s important to today’s talent. Here are seven cultural characteristics that I see as the most essential:
Open and inclusive. Employees want to belong to a culture that encourages two-way engagement—in which traditional hierarchies no longer establish unspoken communication rules, and everyone instead has easy, direct access to dialogue with leaders at all levels. Candor, transparency and personal advocacy for diverse talent are also essential leadership behaviors needed to foster openness and inclusiveness. In strong cultures, there are a number of innovative ways of fueling open communication, ranging from internal blogs to video-meetings and social-media tools.
Fun. There needs to be more intentional playfulness in the work setting. One third of our lives is spent at work, and we should strive to make as much of that time as enjoyable as possible. “Get happy, or get going” seems to be an apt mantra for Millennials. And by fun, I don’t mean casual Fridays or a quarterly employee-appreciation day with free pizza. We should instead create a culture in which solving problems is more like working on a fascinating puzzle; an environment in which team wins feel like Olympic victories, and where the learning process is a gamified adventure rather than an arduous and dull HR (human resources) requirement. To be clear,fun isn’t just a fuzzy, feel-good initiative—it’s an effective tool for recruiting and retention as well. Recent research by the UK-based Social Market Foundation and the University of Warwick’s Centre on Competitive Advantage in the Global Economydemonstrated that happy employees deliver productivity increases of 12-20 percent, while the retention and employee-referral benefits are even more compelling.
Flexible. Most officer-level retail bankers are spread across geographic regions and spend a lot of time in meetings, planning and on conference calls. This environment is particularly conducive to flexible work schedules and telecommuting that, along with generous educational- and parental-leave policies, are essential to employees who seek multi-dimensional lives—and these are the multi-dimensional employees who you want. Stewart Friedman of the University of Pennsylvania’s Wharton School of Business has dedicated years to the study of work-life integration and found that people report better work performance and higher levels of personal satisfaction when they achieve harmony across the four dimensions of work, home, community and self. What’s more, multi-dimensional leaders are also perceived as more “real” and approachable by other employees.
Enabling. A 2016 Gallup study found that 87 percent of Millennials say development is important at work and that they seek a workplace that provides new skills. In spite of this, only 39 percent agree that they learned something new in the past 30 days that they can use to do their jobs better. A culture that places a premium on the ongoing and relevant skill development of its employees earns a sustainable competitive advantage.
Nourishing and noteworthy.While true for all employees, women and Millennials in particular have a high need to work for a company that nurtures a sense of meaningful purpose. They seek both internal and external validation that their personal contribution is valuable, while at the same time they want to join companies that add value to society. Successful cultures repeatedly convey a clear and inspiring vision that delivers tangible results. A good offense requires bold commitment that aligns with a unique vision to build a sense of pride and affinity among existing employees—and also attracts new employees.
Spirited. A strong and healthy culture doesn’t mean everyone agrees all of the time. Diverse and open cultures should foster spirited, passionate debate about what’s important. Steve Jobs often told a childhood story about how he and a neighbor collected rocks that they then placed into a tin container with some liquid and sand. When they shut the lid of the rock tumbler and turned it on, a terrible racket ensued; but the next day, when Steve returned, he was pleasantly surprised to see how beautiful and polished the stones had become. For Jobs, debate on a team was like that rock tumbler; there’s a lot of noise and friction—and sometimes pain—but out of that process comes beauty.
Ethical. While a commitment to maintaining a culture of the highest ethics is fundamental to preserving customer trust, it is also important to broaden the expectation of ethical behavior so that it becomes more than mere policies that minimize the risk of misbehavior. Instead, culture should constantly seek new ways to strengthen a pervasive sense of responsibility at all levels to intentionally do what’s right. The absence of malice alone is insufficient to drive differentiation. To truly stand out, we need to actively pursue and foster genuine integrity and benevolence.
Today, 10 years after the financial crisis, we should take stock to see if our teams are playing cultural defense—worrying about how to most clearly define rules to avoid regulatory fines and lawsuits—or whether they instead have returned to offense. If you haven’t recently evaluated your strength on both sides of the “cultural fence”, now is a good time to get started. While you may not lose without offense, you certainly won’t win.