By Dr Amanda Salter

A 2022 study by the National Australia Bank found that 25% of Australian workers looking to switch jobs were in the finance and insurance services sector, a worrying increase from 19% earlier in the year. Digital and data workers, one of the most valuable skillsets for a progressive organisation, represented the highest proportion of people looking to change jobs, at 27%. The ‘great resignation’ is clearly not over yet.

Don’t leap to the conclusion that salary hikes alone will solve this problem. Research done by MIT last year showed that compensation ranked only 16th among all the factors that influence employee turnover. Temporary measures such as off-cycle wage reviews are kind but difficult to rollback even if inflation falls. So, what else can be done to keep hold of your most valuable employees?

Here are five avenues that forward-thinking banks can explore.

1. Fix your specialist career progression pathways

Many organisations promote their best individual contributors to management based on their technical skills. If you have a fantastic data scientist, the sensible reward is to promote them to the next level as a data science manager. Right?

Wrong. This is the classic ‘Peter principle’ – a part-satirical management concept by Dr Laurence J Peter and Raymond Hull to describe how people in hierarchical organisations tend to rise to “a level of respective incompetence” – in action, and can be a costly mistake. Don’t assume that everyone who can do a highly skilled job at expert or master level will automatically be good at managing others to do the same. Also consider that as people managers, they will, as a matter of necessity, become distanced from the hands-on work they love doing. The organisation effectively pays double in this scenario – firstly in losing a valuable and highly skilled individual contributor, and secondly in declining team performance as the newly promoted manager struggles to master the corporate management skillset he/she needs to do a good job.

Don’t force your highly skilled staff into management in order to progress. Many specialists, especially in the digital and data space, are better off remaining as individual contributors. Consider a branching specialist career pathway, where at specific job grades employees can move either onto an individual contributor pathway or to a people manager pathway. Only place people on the management pathway if they display good potential for it. The individual contributor pathway should have the same number of grades and levels as the management pathway. Each step up on either branch should be recognised and rewarded with a more prestigious job title and the accompanying corporate accoutrements, including that corner office or reserved parking lot.

2. Give employees sufficient autonomy

Research in the area of self-determination theory suggest that humans have three basic psychological needs – autonomy, competence, and relatedness – that are crucial to driving motivation. When all three needs are met, individuals become highly motivated and engaged in their work. This leads to many benefits, including enhanced performance, creativity, or persistence.

Autonomy specifically refers to the feeling that you have choice and control over your own behaviour and actions. Smaller banks can emphasise the flexibility and agility afforded by flat organisational structures, ability to influence the direction of the company, and easy access to decision-makers. Larger banks may be able to provide tailored packages where employees can select the benefits they prefer, such as time off in lieu of working on public holidays, flexitime, more comprehensive insurance, or longer paid time off.

A recent example of this is Citi’s new post-Covid resiliency programme. In 2022, Citi Singapore launched a partially paid sabbatical leave option, allowing eligible full-time employees to take up to 12 weeks off while drawing 25% of monthly pay. This allows employees to pursue personal interests and focus on well-being, travel, spend time with loved ones, voluntary work, or just to recharge.

There are different ways for managers to provide freedom and choice in the workplace, and the options offered should work with the team culture and needs. The size of the organisation matters here – larger organisations may be able to afford more options than smaller ones. Also, don’t go overboard – too much autonomy can lead to a loss of connectedness and can also lead to poor behaviours in employees.

3. Ensure each employee’s work is clearly linked to company objectives

Employees who can see that their work is contributing to a meaningful purpose are generally happier, work harder, and are more resilient at overcoming challenges. Large organisations have historically struggled to create a direct sense of connection between employee and the broader company vision or objectives, especially for frontline colleagues. Research from McKinsey found that frontline managers and workers were three times less likely than leaders to say that they can connect their daily work to the organisation’s purpose.

Global organisations from Google to Barclays Bank use a framework called Objectives and Key Results (OKRs) to ensure that everyone can connect their contribution to company goals and objectives. How do OKRs generally work? At the beginning of every quarter, the company board sets their OKRs and makes these visible to everyone. Once that’s done, departments and teams lower down can then set their own. OKRs belonging to departments and teams must align to other OKRs that are higher up, at any level. A team can choose to align their work to OKRs at the board level if they wish.

Well-managed OKRs drive accountability and transparency because every team’s OKRs are always visible, together with the progress that is being made towards achieving them. Well-written OKRs grant every employee clarity and visibility on how the work of their team ladders up to the bigger picture, all the way up to the board.

There are other benefits to using OKRs. OKRs deliberately focus on outcomes instead of outputs. This grants more autonomy to teams to choose the best way they feel they can drive the higher-level outcome that the organisation is looking for.

4. Foster and embrace innovation from the grassroots

Many banks understandably rely on external consultants for innovation services, but to do only this is missing a trick. All banks are sitting on an untapped goldmine of insight and knowledge that can spark thousands of innovative ideas. This rich resource resides within the collective intelligence of your own employees. Your employees already have a deep understanding of the issues that your customers face with the existing services. They know which internal processes need to be transformed and overhauled in order to improve the way things work. They are also more motivated to fix these problems because they have a direct connection to improving the day-to-day lives of colleagues and customers.

Innovative banks can create channels where employees can submit ideas for improving things. The mindset here is that valuable innovative ideas can come from anyone, from the lowliest intern to the highest paid executive. Giving good ideas recognition, credence, and support builds engagement and loyalty as employees see that their ideas are valued and adopted.

BNP Paribas’ Lab4Good intrapreneurship programme enables employees to submit a social action idea in line with the UN Sustainable Development Goals, apply for support, and, if successful, progress their ideas into the pilot stage. The Lab4Good programme is now in its fifth year and around one-third of the projects emerging from the incubator are taken up by the bank’s business lines. Successful projects range from a new responsible savings account for clients with options to invest in the sustainable economy to a complete energy-efficient retrofit solution for office buildings utilising expertise within the BNP Group, including financial advice for renovations.

5. Weed out toxic bosses, protect your workforce

Research from Stanford Business School concludes that organisations tend to hire narcissistic leaders, particularly in times of turmoil. A narcissistic leader can demonstrate, on the plus side, extreme self-confidence, a strong visionary attitude, charm, and charisma. On the downside, they exhibit aggressive behaviour, extreme self-interest, a lack of empathy, and a defiance of ethical boundaries. In a position of power, these behaviours percolate downwards, guiding the behaviour and expectations of others, shaping the culture, and normalising unethical, self-serving behaviour. Organisations large and small can be destroyed from within by putting this type of leader into power and examples abound from Enron to WeWork.

There is truth in the cliché that ‘people don’t leave bad companies, they leave bad managers’. Working for a narcissistic, toxic boss results in higher levels of depression, lower job satisfaction, and ultimately, the loss of high-value employees.   

In evaluating candidates for senior leadership positions, look beyond the interview. Don’t skimp on background checks – feedback from people who have worked with them and for them in the past is critical. Look for discrepancies in feedback from the people above and below them – narcissists will treat both very differently.

Ensure your grievance policy and whistleblowing procedures provide enough protection for staff to feel safe. Provide conflict training to staff so that they are equipped to better handle a toxic manager. As for the toxic individual themselves, professional coaching can help, but if faced with a stubborn, aggressive person, you must be prepared to let them go, even if they appear to be driving great benefits for the business. This is the only way to protect your workforce.

None of these avenues may seem like an easy fix. Is it really worth investing in employee engagement, motivation, purpose, and well-being? A recent joint study by Oxford University’s Said Business School and Harvard University uncovered positive evidence for the long-suspected belief that companies with higher employee well-being (which includes aspects of happiness, purpose, and satisfaction) have higher profitability and better stock market performance. Improved well-being naturally increases the likelihood that employees will stay with you for the longer term. This saves on employee turnover costs, which can have a significant impact on your bottom line.

At the end of the day, if a valuable individual is determined to leave, there is not much you can do to stop them. Where banks can make a difference is by giving their people more reasons to stay.

Dr Amanda Salter is Associate Director at Akasaa, a boutique content development and consulting firm. She has delivered award-winning customer experience strategies for the Fortune 500 and been an Agile practitioner for over a decade. Previously with Accenture’s London office, Dr Salter holds a PhD in Human Centred Web Design; BSc (Hons) Computing Science, First Class; and is a certified member of the UK Market Research Society and Association for Qualitative Research.