Banks meet challenges/opportunities with hybrid work

If there is one phrase that has dominated offices worldwide in the 2020s it is hybrid work. When the pandemic forced nonessential business to shut down, those businesses rapidly had to shift their employees from the office to remote work.

As these restrictions began to lift, businesses found many employees wanted to either remain working from home or shift to a hybrid work model where they would come into the office a few days a week and work remotely the other days.

Banks have had to tackle this issue as well, to varying degrees of effectiveness, in part due to branch culture heavily favoring in-person work, which has been a major point of discussion for the ICX Association Financial Peer Group, which gathers both bankers and analysts to discuss pressing issues in the banking space.

"Like many retailers, banks are challenged with having a certain percentage of employees who work on the front lines and their in-person presence is required to operate the franchise," E.J. Kritz, EVP, training and customer experience at apc and member of the Financial Peer Group, said in an email interview. "For many on the back-end however, banks have been sluggish to keep up with other industries when it comes to allowing employees to work where they believe they are most effective."

In particular, Kritz said banks have been slow to adopt measures that allow employees to work in a manner that best fits their "natural style." This in turn have hurt bank's overall employee engagement.

"Capped off with an ever-present 'old school management style,' most banks seem to have not learned valuable employee engagement lessons that the pandemic taught countless other industries. In short, the banks biggest challenge in hybrid/remote work is its own executive leadership."

On another level, banks have also struggled to create a connection with hybrid or remote workers, as many can feel disconnected from those in the office.

"A hybrid work environment creates a rift between those working in the office and those from home. It also is challenging to reinforce a culture with so many of the workers not in the office," Jean-Pierre Lacroix, president of SLD and member of the Financial Peer Group, said in an email interview. "Elon Musk forced all of his managers at Tesla to work 40 hours at the office. His reasoning is that it was not just to force factory workers to come to work while office managers worked from home. When banks have worked so hard and breaking down the silos and building a strong corporate culture, having to manage meetings both physically and virtually creates a have and have not environment."

However, when banks attempt to get people in the office on a more regular basis, this can drive employees to search for better jobs, as those workers may have moved further away from the branch to new homes.

Despite these challenges, Kritz believes there is still a great benefit for banks with remote/hybrid work: the ability to hire outside of a bank's geographic footprint.

"Especially for remote areas, the ability to find good underwriters, compliance officers, etc. can be challenging. Under a remote work environment, it's easy for a tiny bank on Cape Cod to hire an analyst from Florida," Kritz said. "Furthering the point, banks in areas with expensive cost of living such as New York and San Francisco can also seek employees in places like Omaha and Boise where a great employee can potentially be had at a bargain price. Finally, a bank's ability to now move call centers offsite has expanded both its hiring radius and potentially even offering hours with ease, all while cutting down on unnecessary real estate costs."

All that being said, it can still be a challenge for banks to change their culture to meet the needs of this new work force. But there are ways to make the transition easier.

Lacroix recommends using a variety of tools such as weekly town hall video meetings, creating employee run-content and reviewing the bank's meritocracy structure to encourage collaboration with remote and in-office workers.

Kritz said banks should, "Let people be the humans they are."

"To simply say that 'the underwriting team will now work from home,' on paper sounds great. The reality is though, not all employees (or humans) are the same, and an underwriter who is wildly extroverted will eventually become disengaged, as they now no longer have an office space in which to seek social interaction," Kritz said. "It's critical that a bank base its culture not around the CEO, but around each individual person. A culture based on the gift of choice is prime."

For more insights into banking, click here to join the ICXA Financial Peer Group. The peer group gathers both consultants and thought leaders in the financial industry to discuss key issues in the industry such as remote work, customer experience, branch innovation and more. The group meets monthly on Zoom calls. The group is part of the larger ICX Association, which focuses on customer experience technology and tactics across the business spectrum.