Too many banks leave their corporate culture on cruise control.
So says Anthony Abbatiello, a principal in the human capital practice at Deloitte, who believes that culture — if properly tended to — has the potential to focus employees more intently on making the business strategy work.
Unpacking the insight behind that statement can feel like a counseling session, mostly because it relates to the emotional landscape of an organization and how employees feel. Not many companies — our Best Banks to Work For being among the exceptions — focus on such squishy things from a business perspective. And maybe the squishiness is one reason why. "Corporate culture is often talked about as being fluffy and emotional," Abbatiello says.
But as hard to measure as corporate culture can be, it is becoming increasingly important. A majority of top-level executives across industries (82%) believe culture is a potential competitive advantage, according to this year's Human Capital Trends report from Deloitte. That's up 9% from last year.
One trend driving this is the influx of millennials in the workplace. To this important demographic, putting "people over profits" matters, Abbatiello says. "What millennial values are and how those align with culture is the core of what's going to attract talent, especially millennial talent and digital natives, to many organizations," Abbatiello says.
He lists three steps to creating a corporate culture that will help businesses thrive. First is making sure that the strategy executives put in place properly aligns with the corporate culture.
"The second is around the emotional connectedness," he says. "And the third is around the rigor you put into measuring that. And that emotional connection piece, we found that really to be the 'X' factor."
Connecting with employees on a personal and an emotional level — so very Dale Carnegie — is a priority for those on our annual list of Best Banks to Work For. They are generous with time off for employees, show them appreciation regularly, encourage their feedback, keep them updated on company performance, and otherwise demonstrate to them that their thoughts and feelings — and their happiness — matter. They also argue passionately that all this translates into stronger business results.
And yet, they remain outliers in their business strategy. Despite many executives knowing that emotions are often the driving force of human behavior, in business, they are rarely, if ever, the focus.
"When it comes to the employee population, we stay away from that. We tend to be more medicinal and sterile in how we approach it," Abbatiello says.
He advocates for a change in that approach.
To be most effective, every organization should have a mission, a reason for being with a vision behind it. The strategy is how you get there, how you accomplish that vision. The corporate culture is what enables the strategy. "It's the values and behaviors that drive how work gets done inside the organization, Abbatiello says.
This is how Abbatiello sees many companies go wrong. "C-suite executives develop strategies to address the opportunities in various areas of their business, but very often they leave their culture on cruise control, meaning they don't actually evolve the values and behaviors of the organization to align with what they're trying to accomplish as an organization in their strategy."
One way that often plays out in banking is with the push to be innovative.
"What's needed in that environment is a culture of collaboration — the ability to fail fast and often and know you're going to be rewarded for it," Abbatiello says.
But many companies — banks in particular — struggle to achieve that kind of cultural shift. The reason is that despite a new strategy and clear business goals handed down from the top, the values and behaviors within the organization remain unchanged.
Storytelling can help. Abbatiello gives as an example of a client that needed to spur innovation and, consequently, encourage more risk-taking. This required getting employees to really believe that it would be no big deal to fail sometimes.
So the company began to highlight examples of this in employee meetings. Those giving the presentations not only talked in detail about what went wrong, but how it made them feel. The tactic backed up words with action.
"Actually living that, telling that story and being a bit vulnerable in front of the organization helps make that emotional connection," Abbatiello says. "It helps people to hear that personal story of 'I tried this idea and it failed. It failed miserably because I didn't have the right team together, I didn't have the right skills and capabilities, and our strategy was flawed. But I knew from that moment what we needed to put in place as we went to the next iteration of it.'"
The bottom line for Abbatiello is that feelings matter in creating a strong culture. And thanks to millennials, we might just see more such squishiness in the next iteration of the corporate world.