The financial services sector has gone through lots of turmoil in the last decade including reputational harm after the global financial meltdown in 2008.
Increasing regulatory requirements and sophistication around them post 2008 crisis forced many financial services companies to rethink their business strategies.
Additionally, technological advancement, pressure to digitize and increasing influence of the social networks made the financial organizations to rethink their customer interactions and focus on the customer experience in these types of interactions.
The changing rules of the participation prompted these companies to take a fresh look at the skillsets that would have to manage, grow and sustain the businesses.
Technology skills which were traditionally part of IT now became a necessity for the whole workforce together with the domain knowledge. Globalization to some extent helped bridge the shortages in talent acquisition.
However, the firms still face resource shortages and are finding it extremely difficult to hire and retain the right talent.
The following are some of the challenges from the Human Resources perspective:
Striking a balance between experience and rapidly changing skill sets
There is a wide gap between the experienced workforce and the Generation Z (millennial) which are entering the workforce. 3-4 different generations are interacting in the same workplace. The HR departments are finding it difficult to strike the ideal balance between expertise and skills and bridge the gap.
As the skills deficit increases in the current market, it is becoming challenging to attract and keep the best talent amongst fierce competition.
Skill shortage in the local markets has forced companies to look for talent globally.
Globalization comes with its own challenges like cultural differences, language barriers, etc.
Also, some areas in the Financial Services industry are market specific restricting HR’s ability to recruit people from a wide geography.
Ability to turn around quickly to respond and support the businesses
In the last few years, the markets have been witnessing shrinkage in the lifecycles of services and products.
The time to market has been reducing drastically forcing HR departments to move away from their traditional maintenance jobs and requiring them to become more proactive to support the business needs.
There has been a growing demand for the HR departments to continuously assess the short-term and long-term aims to be aligned with the organization.
Effective HR Strategies to address the challenges
Developing a comprehensive workforce plan which is flexible can help companies overcome resource shortages.
Flexibility to ramp up or ramp down resources at any given point in time in response to the changing business requirements, market conditions and financial situation can assist these financial institutions to sustain in the market and deliver results.
Customize Rewards & Recognition programs :
While compensation plays an integral role in attracting and retaining talent, there’ll be employees at certain levels which are looking beyond compensation.
Recognizing the needs of employees at different levels and Devising innovative programs at various levels can help keep employees.
Talent Management: Human Resources should adopt a holistic approach in Talent Management area to be able to mitigate the Talent risks:
- Training and Retraining employees, succession planning and accelerating leadership programs within the organization at different levels is crucial.
- Role definition and targeting the right talent in the Market with the social networks and developing talent communities can help companies overcome skill shortages.
Technology Adoption: Human Resources departments can rely on newer technologies to improve their operational effectiveness:
- Treat employees like customers and improve the employee participation and engagement through technology adoption which could provide mobility to the employees.Developing metrics, data-driven Models, and HR intelligence to make informed decisions by creating meaningful and actionable HR insights by embracing the newer technologies can improve results.