Top financial institutions feature many of the same faces year after year. This goes not just for senior management, but also for middle management and even branch managers.
This is not the case at enough banks — and I believe that high turnover rates can hinder banks as much as any other factor.
Things like the increasing presence of individual production goals, extended hours, weekend schedules and leaner staffing models have likely contributed to increased turnover in recent years.
Of course, some turnover is normal. But I’d estimate that the question I’ve received most over the past decade involves finding ways to motivate employees. Reducing turnover is a close second. This suggests that the problem is not that employee morale issues are going unnoticed. Yet many do not seem to prioritize getting turnover under control — or realize that these losses can lead to a vicious cycle.
Professional sports teams tend not to win championships when made up largely of rookies. It is not that rookies do not have talent, enthusiasm and potential. They usually do. It does not mean rookies cannot be star players — they can. But what a team filled with rookies tends not to have is cohesiveness, deep knowledge or levels of resilience that experience tends to produce.
It simply takes time to become competent — and then exceptional — at a job, whether in sports or in banking.
That means that high turnover rates can keep branches from ever performing at their best. Moreover, the attrition of managers and front-line employees actually affects banks more adversely than it does many other businesses.
At most stores, the products purchased are removed from the person standing behind the counter. If the shoes, or coffee, or sandwich you are buying is desirable and competitively priced, you aren’t likely to be factoring the competence of the employee selling it to you all that much into your decision. They may be nice and even offer helpful opinions, but we do not consider them an integral part of the product itself.
In banking, our product involves trust and security. It also involves respectful service, competent problem resolution and knowledgeable advice. These are all crucial to the business of banking — and they rely on informed, engaged and experienced employees.
Unfortunately, there’s no magic wand that can be used to slow turnover. Higher wages can help if pay structures are not competitive with the market, but even financial institutions with high pay can experience high levels of turnover.
Until leadership has an accurate grasp of the factors leading to the individual turnover issues at their institution, the problem endures — and frequently gets worse. Moreover, the people most disheartened by continual turnover tend to be solid, loyal employees worn thin by having to operate in understaffed or inexperienced offices.
Bank executives should talk to some of their most valuable employees now, before they potentially turn in their resignations. It always amazes me how many leaders underutilize and undervalue some of the most relevant “consulting” available to them — frank conversations with their own top performers at various levels of their org charts. Quite often, the things most wearing our good people thin are not even on our leaders’ radars. And while issues vary from bank to bank, senior management is frequently surprised at how easy some “fixes” are for seemingly trivial things they never worried about before.
Most solid and conscientious employees are not putting their hands up to tell their leaders when and how they are losing faith that they are where they should be. They continue working hard right up to the moment they submit their resignations.
If nothing else, telling valued employees that they are respected and critical to a team’s success tends to be a retention enhancer in itself.
In an evolving and ever-more-competitive industry, the push to do more with less will always be on us. Having the right mix of people in the right places at the right time might be the difference between a high-performing branch and one that ends up on the chopping block.
Some organizations are becoming more sophisticated with their staffing models and creative with their mixes of tellers and universal bankers, as well as full-time and part-time job roles. One friend recently told of very positive results when they became far more involved in helping their managers strategically schedule their workforce.
They are seeing that the stereotypical “the best employees only want to work full time” belief is often wrong. In many instances, increased use of part-time employees along with offering qualified people more flexible schedules are attracting and retaining high-quality team members.
Financial institutions don’t always closely enough connect staff turnover and overall performance, but those that do stand to gain.