The skills gap in the financial services industry is intensifying. To drive continued innovation and remain relevant, companies must bridge this gap to gain access to the skills needed for the future of work. Here, Patrick Luther, VP and Principal, Financial Services Advisory at Ceridian explains how companies can accomplish this.
The financial services industry is changing. New skill requirements are emerging, while other skills are becoming obsolete. Future jobs are expected to be more robot-assisted and data-driven than in the past, but importantly, they will also likely require more human skills – like critical thinking, for example – to solve complex business problems. And this is all happening at a rapid pace – even faster than the talent pool and the education system that feeds it can adapt.
In PwC’s 2019 Financial Services Talent Trends report, 54% of CEOs claim that the unavailability of key skills impacts their customer experience, as well as their ability to innovate effectively. One reason for this skills shortage is that candidates with the required skills are increasingly attracted to the technology sector. For instance, 32% of new grads from Haas School of Business University of California Berkeley are choosing to work in the tech sector and only 17% land jobs in financial services.
Furthermore, financial services companies often struggle with adopting technology to modernize processes and address the skills gap. As a result, they’re left scrambling to fill vacant roles instead of focusing their efforts on company growth and innovation.
Organizations that are unable to adapt to the new skills economy will find themselves on the losing side of disruption. To ultimately close the skills gap in our industry, organizations must move away from antiquated ways of hiring and training talent and adopt forward-looking strategies to build a workforce with the skill the future of work demands. Here, I outline three ways financial services companies can accomplish this.
1. Reskill the workforce
Emerging technologies such as artificial intelligence and robotic process automation continue to shift the balance of labour between employees and machines. These technologies are streamlining jobs in financial services and heightening the need for different skills as existing jobs are transformed. As a result, technical and analytical knowledge, as well as critical thinking and problem-solving, will be valuable skills in building innovative digital experiences for customers.
Companies will need to develop learning systems that cater to the needs and learning styles of their workforce so they can quickly build the skills of tomorrow. One example is microlearning, which is learning in the form of short skill-building videos or text messages pushed from smartphones.
Social learning methods are another impactful way employees can build knowledge and skills quickly through peer collaboration and coaching in an informal setting. This form of learning is reflective of the personalized experience the workforce expects as consumers. Learning Experience Platforms (LXPs) for example, are one way organizations can offer up personalized content to suit the varying learning styles and preferences of employees. This type of learning enables employees to share concepts and ideas on discussion boards, allowing them to reply to questions and read answers on specific topics. Additionally, modern workplace learning experiences such as social and microlearning help employees to not only understand concepts faster, but to engage with and retain the information more effectively than they would learning through a traditional course.
2. Expand talent pools
The financial services market is being shaken up, largely due to the widespread adoption of new technologies and fast-moving fintech startups that are accelerating the customer experience. Without a resilient and adaptable workforce, established financial services companies won’t be able to keep up. Therefore, success in the future relies on an organization’s ability to hire people who can embrace change and drive the business forward in the digital future.
One way organizations can gain access to this type of talent is by recruiting candidates that have certain behavioral skills and attributes that demonstrate they will thrive in changing environments. For example, certain people prefer rigidity, structure, and repetition, while others are more agile and able to stay productive amid transformation.
Organizations can expand their traditional sources of talent and hire people from diverse educational and work backgrounds, as well as from outside the industry, such as the technology sector. This approach will help organizations tap into larger pools of high-potential talent that are likely to have the attributes needed for the future of work. Organizations will need to invest in modern recruitment technology that allows HR teams to create talent pools based on the behavioral skills and attributes they’re looking for.
3. Develop leaders from within
Digital disruption within the industry has led to the emergence of new customer-centric digital ecosystems. This means leaders must understand how to leverage these new technologies effectively and understand how to integrate digital talent into their teams. However, the reality is that only 15% of executives and digital leaders claim to be “very prepared” to guide their companies through the eye of the digital storm.
Companies can overcome this challenge by training emerging leaders on various digital capabilities to drive continued innovation within their teams. Succession planning can play a key role in helping companies identify and develop leaders with the right skills to manage teams with technical know-how.
The financial services industry is experiencing the effects of digital disruption more than other industries and as a result, must work harder than they have in the past to acquire the skill of the future. 82% of insurance CEOs, for example, say that technology will disrupt their sector in the next five years, compared to 64% of all CEOs and just 43% of those in the hospitality and leisure industry. Companies within our industry must immediately work to address the gap in skill they have now and the skill they need for the future of work.
Download the guide, Investing in the Future to learn how to overcome the acute skills gap in the financial services sector.
The Ceridian Institute provides forward-looking insights that build awareness and advocacy of the trends and challenges facing the workplace. The Institute is composed of industry leaders from Ceridian’s Industry, Value, and Solution advisories, reflecting the team’s research into the future of work and business intelligence.View Collection
Patrick Luther is Vice President and Principal, Financial Services at Ceridian. He has over 10 years of experience in product management and marketing of enterprise software, and 10+ years in consulting for the financial services sector. Patrick is a former U.S. Navy Lieutenant, and has held leadership roles at IBM, Rational, Infosys, Deloitte, and various SaaS startups. Patrick holds a B.S. in Mechanical Engineering from the University of Rochester and an MBA from Yale.View Collection