The top concern for bank leaders going into 2022 is the ability to attract qualified talent. According to a December survey conducted by Cornerstone Advisors, the percentage of banks identifying hiring as a concern jumped from just 19% in the 2021 survey to a whopping 67% in 2022.
It’s clear that banks haven’t been immune from the pandemic-fueled “Summer of Quitting” and the members of the Alloy Labs Alliance, a consortium of innovative banks, are no exception. In fact, Alloy Labs members are especially prone to hiring difficulty because they’re trying to fill in-demand roles that support technology and innovation.
As the labor shortage continues to intensify, the members of Alloy Labs’ Innovation Culture Center of Excellence are taking a fresh look at the opportunities and challenges around hiring. Recently, the group hosted Brian Love, Head of Banking and Fintech for Travillian — a boutique executive recruiting firm dedicated to serving financial institutions. Love’s discussion with members yielded key insights on the new rules of talent acquisition.
Rule 1: Re-examine your hiring process
To keep candidates in the pipeline, banks need to streamline and possibly re-order their hiring process.
Requiring applicants to jump through preliminary hoops and have initial conversations with HR can create hurdles too early in the hiring process for today’s competitive environment. Love suggests getting candidates on the phone with the bank’s innovators immediately. “They need to meet that brain trust so they can understand where ideas at the bank are coming from.”
There also needs to be total alignment on messaging among those involved with hiring. Any miscommunication or disorganization among the bank’s hiring staff will leave a lasting impression on the candidate that may cause candidates to drop out of a hiring process. Love suggests that those with a stake in the new role have a kickoff session before beginning their search to ensure consistency.
Rule 2: Choose your battles wisely
It’s an employee’s market these days, and employers must be more flexible than ever before to fill the roles they need. Nowhere is this tension more evident than in the demand for remote work.
As one Alloy Labs member described, it’s difficult to consider hiring remote workers when a huge part of a bank’s value proposition often rests on the promise of local, personalized service. But the dearth of available tech talent is forcing some banks to rethink their stance.
Love recently led a search for an innovation role for Alloy Labs member Lincoln Savings Bank where the need to be flexible on geography was accepted from the start. “There was no location preference [for the role], and I thought that showed incredible foresight,” Love said of his work with Lincoln CEO, Erik Skovgard. “It’s a painful decision for a bank that spent millions of dollars renovating a beautiful building in Iowa. But they realized that they were seeking a niche role in innovation management and there’s not a lot of people that can do that.”
Some banks are also coming to grips with the need to loosen standards around personal appearance for roles that aren’t customer-facing as well. SVP and Chief Strategy Officer for Alliance member First Mutual Holding Co., Jennifer Raynor, pointed out that many of the roles innovative banks are looking to fill require creative people. “Creative people may choose an expressive style with their appearance that companies need to be more open to now,” she says.
Rule 3: Put your best foot forward
Before beginning any search, Love meets with the Chief Technology Officer of the bank. He does this regardless of the type role that he’s hiring for. Love reasons, “even if it’s a CFO we’re hiring, we want to understand what tools and resources are going to be available to them. The talent wants to know that there’s a commitment to innovation, to automation — that they’re not going to walk into a CFO role where they have millions of spreadsheets.”
Similarly, candidates need to be assured that they’ll have the support and ability to make the impact they want to have on the bank. Simply having an innovation title at a bank isn’t worth much if the rest of the culture isn’t supportive of their change-making efforts.
Love recalled an instance where a role didn’t evolve as the candidate expected it would. “Two years in, the candidate realized there were all these organizational layers over technology that really stifled what he thought he could bring. He’d made some great strides,” Love says, “but he hit a plateau.” That employee was snatched up by another bank whose CEO promised higher compensation and extended an offer during their first phone call.
Rule 4: Hire for culture first, then skills
One of the key competencies Love says banks should be hiring for isn’t a certification or a programming language or any other functional attribute. It’s an entrepreneurial mindset.
“When we do our vetting of candidates, I’m trying to figure out if this person can think of the bank and its vision as their own business,” Love explains. “That’s what’s at the root of all innovation — someone who owns something like it’s their own business.” If a candidate’s first inclination is to delegate, Love sees that as a red flag he’ll need to push harder on. He believes banks should be looking for people who instinctively take ownership.
Raynor noted that learning agility and comfort with ambiguity are two more crucial soft skills for people taking on innovation roles within banks. These qualities are difficult to suss out, but they’re more important than hard skills in many cases.
“I’m a believer that culture does trump skills,” Love says. “Someone who can exist in that organization and fit in very quickly is more important than someone who’s got ten out of 10 skills.” Plus, Love says, you’re not likely to find someone who checks every single skill box anyway. Flexibility, it seems, is the new name of the game in talent acquisition.