Consumer Banking Under Siege: the Digital Transformation Secrets of Trailblazer Banks

The banking scenery is rapidly changing. Consumer banks, the gurus of risk management and pillars of the global economy, are now urgently called to reinvent themselves. The pandemic has disrupted their retail branch operations, and shifted the preferences of their customers towards remote service models and digital products. The rise of blockchain and AI, coupled with cybersecurity concerns challenge banks' understanding of what digital-readiness entails. Retailers like Walmart, Big Tech providers like Amazon, and a wide array of innovative FinTechs are gaining momentum in the market. This puts enormous amounts of pressure on banks' profitability, who are feeling the heat to digitally transform themselves.

However, not all banks find themselves in a dire state. We just completed a?major industry study?in consumer banking as part of our Global Workforce Intelligence Project, (the entire research collection is exclusively available to the Josh Bersin Company?Corporate Members) and we uncovered a breed of highly transformed banks who are thriving in the market.

We call them Trailblazers and, at a time when the majority of the industry is being pressured, they seem to be accelerating their lead. What sets them apart? Well, it's not what one might initially think...

The commonly held belief is that the future of banking relies a lot on technology and analytics. This is, of course, true. But only to an extent. We looked at the top 200 global banks and identified what sets apart Trailblazers, and it's not better analytics or access to superior technology. It's the uniqueness of their talent strategies, organizational models, and culture.

Trailblazer banks are able to offer the high-touch digital experiences their customers are seeking (and secure their profitability!) because they approach technology, product development, operations, culture and skills differently. Traditional banks aren't challenged to access great technology; they are challenged by the fact that their talent cannot keep up.

We actually ran the numbers on this, examining the skills, talent and organizational structures of more than 200 banks globally. We tapped into the rich database of the Josh Bersin Company around people practices and strategies, combined with million data points from Eightfold's Talent Intelligence Platform around job roles and skills. We also conducted deep-dive interviews with more than twenty of the largest players in the global consumer banking industry to capture their stories. One thing became evident: the digital transformation of banks is a talent challenge.

Most consumer banks are 3-5 years away from providing the digital products and services customers need, because their are short on critical forward-looking tech skills. Meanwhile, their existing skills are either stable or losing prevalence (declining) in time.

Meanwhile, Trailblazer banks have vastly different roles, job titles, skills, and distribution of labor compared to their traditional peers. With 1.3x more people in the IT and digital-related areas of the bank, and 1.6x less people in middle and back-office areas, they place more people where they need them to create better digital services and products for their clients.

Trailblazer Banks also place a lot of emphasis on the type of roles people occupy; not just where they sit in the organization. They have 3.7x less people in middle/back-office and front-line service roles, and 2.3x more people in transformation roles than traditional banks. They don't just focus on building great products. They also run leaner teams and are deeply concerned about how to transform the operating model and change the organization looking ahead.

Skills are top of mind for all CHROs in banking right now. Trailblazer Banks actively prioritize forward-looking digital and technology skills. It's the skills that help them build more modern user interfaces, capture and understand their client base better, and swiftly pivot operations to address those needs.

However critical, the talent mix, tech roles and skills are not the only thing that sets apart Trailblazer Banks from their traditional counterparts.?Trailblazer banks build enduring employee-focused organizations because they adopt key people practices that forge irresistible cultures. They approach the organization as a system, and apply a multitude of strategies that, in unison, help them effectively address any digital capability shortage.

Trailblazer banks invest in building talent organically and sharpen their reskilling muscle. They adopt agile ways of working. They offer flexibility and expand benefits beyond pay and bonuses. And all these strengthen their employer brand and capability to attract and retain the talent and skills required. Trailblazer banks play the long game.

In our rich collection of resources created for this study, you will find:

• A comprehensive analysis designed for CHROs and CEOs outlining the strategies and the practices that work in Consumer Banking right now and help Trailblazer banks effectively address the industry's most pressing business and talent-related challenges.
• In-depth talent mix, role and skills benchmarking guides which lay out the next step in the digital transformation journey of consumer banks, and
• A series of case studies from identified Trailblazer Banks, which will help you see how these strategies and practices are implemented.

And here is a brief video outlining top findings, key results and best practices included in the study.

If you’d like more information about this study, please contact us or download our?GWI Banking Infographic. By joining the Josh Bersin Company?corporate membership program?we will walk you through the findings and you can?benchmark your organization against the Trailblazers. And if you are wondering about Josh Bersin 's key takeaway points from our study, please feel free to check out his latest article below.

For more information on the Global Workforce Intelligence Program,?download our whitepaper?on the changing world of industries, jobs, and organizations.