Workforce strategy a priority for the evolving BFSI industry

February 22, 2018 | Thought Pieces

Workforce Strategy - BFSI Industry

The Philippine Banking, Financial Services, and Insurance industry experienced growth in 2017, with the banking industry GDP rising from 6.7 percent to 6.9 percent in the third quarter and insurers experiencing 22 percent income gain.Firms expect to ride the country’s economic growth in 2018, especially with the implementation of Tax Reform for Acceleration and Inclusion Act (TRAIN).  

However, global advances in technology and the rise of new competitors require banks and insurance companies to think beyond simply running their business to transforming it. Customers demand greater digitalization and innovation, and financial technology companies are quick to offer what traditional banks and insurance companies, with their retiring employees and legacy systems, cannot. If it is to sustain long-term growth, the financial services industry as a whole needs to evolve with the times—beginning with its aging workforce.

Building a new workforce

Employees older than 40 currently comprise 60 to 65 percent of the banking industry workforce. As they retire, banks must hire a new generation of employees with different needs and work expectations. Not only will banks have to transfer the knowledge of their retirees to a younger workforce, they also have to identify new ways to attract, retain, and motivate them.

This proves especially challenging as millennials value personalization, flexibility, and rapid career growth in contrast to the industry’s traditional mindset. Companies will have to rethink their compensation and benefits packages to address the varying needs of millennials and offer them opportunities to build their career over a shorter period of time.

Competing for talent

With the banking industry moving toward further digitalization, there is greater demand for technology-related roles. The economic growth has also opened up opportunities for insurance companies to tap a wider range of customers, and they require skilled representatives to better manage clients’ needs and solutions. Banks and insurance companies therefore compete not only with recruiters within their industry but also with technology firms and startups that have become today’s employers of choice.

To attract the talent that they want, companies need to change their reputation for being conventional and position themselves as dynamic and innovative employers. This entails redesigning their spaces for collaboration, investing in work technology, and offering more flexibility in the workplace.

Providing necessary training

As companies hire and expand their workforce, they must continue to train their existing employees in digital technologies, data science, and best practices in order to keep up with the continually evolving industry. Learning sessions are especially important in insurance firms to avoid employees mis-selling insurance plans.

With millennials looking for challenging and varied work, the onus is on Human Resources and managers to recognize their potential and give them opportunities to diversify their skillset. This enables employees to contribute to different departments within the company while also furthering their personal career goals.

Prioritizing employee engagement

The financial services industry has always relied on cash to attract and retain employees, but in many cases, technology firms offer flexible working schedules and extra incentives on top of a hefty compensation package. Banks and insurance companies must then increase their efforts in engaging their people to avoid losing valuable talent.

Employers will have to change the way they manage their people, drawing on a keen understanding of the different generations in the workplace. This involves encouraging communication between managers and team members, implementing rewards and recognition programs relevant to a diverse population, and promoting a culture of collaborative growth.

Technology is propelling growth across multiple sectors, prompting changes in the nature of work. To maintain relevance and competitiveness, the financial services industry must be quick to adapt and develop a strong people strategy as foundation for its continued success.

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