Although challenged by corporate restructuring and cost cutting, banks and financial firms can’t afford to overlook talent development, which could impact their long-term performance.
Brenda Wilson, Mercer’s Asia-Pacific leader of talent development consulting, says regardless of the current economic cycle, banks must be careful with redundancies to avoid losing key people and draining their talent pool. While banks may face training budget restraints, talent development programmes should be maintained as these will help build a workforce that can overcome challenges and deliver results in the future, says Wilson.
“Organisations that don’t have a clear strategy around their workforce needs and retrench the wrong staff could end up facing stiff challenges during the next economic upswing,” she adds.
Wilson says surveys show that firms which cut the wrong segments of their workforce struggle to make profits even when markets recover. “If a company cuts the wrong 10 per cent of its workforce, there is a risk that it is cutting 100 per cent of its value,” says
Wilson, citing the need to keep experienced bankers and skilled technicians who would be difficult to replace.
Wilson explains that when job cuts are necessary, human resources (HR) departments must assist management in evaluating workforce risk and the business impact of job cuts.
“Economic cycles come and go, so banks need to look at their short, medium and long-term strategies and the workforce they need to achieve their objectives,” she says. “In many cases, if it is necessary to downsize the workforce, a surgical rather than an aggressive, invasive approach could be more effective.”
She adds that once lost, employees with skills and experience can be difficult to replace. “There remains a core Asia-Pacific issue of labour supply and demand imbalance, which impacts talent development. Ageing populations and labour immobility are two of the contributing factors,” says Wilson, adding that leadership development is a key concern among CEOs in the region.
Dora Wong, managing director at talent and career management firm Right Management, says talent management is often a case of what banks are not doing rather than what they are doing.
Wong says talent development is not simply a case of providing one-size-fits-all multip