Viva People Science Industry Trends: Finance

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Welcome to the third edition of Microsoft Viva People Science industry trends, where the Viva People Science team shares learnings from customers across a range of different industries. Drawing on data spanning over 150 countries, 10 million employees, and millions of survey comments, we uncover the unique employee experience challenges and best practices for each industry.

In today’s blog, @Avneeta_Solanki and I share our insights on the state of employee engagement in the finance industry.

The finance industry is complex to say the least, consisting of players in banking, investment and asset management, insurance, financial technology (fintech) accounting, and financial consulting. Despite its complexity, there is one thing that organizations across this industry share globally: heavy regulation and governance that ensures consumers are protected, that the market remains stable, and that practices are fair. And adapting to these regulatory changes creates a pressure that gets passed down to all teams.

Coupled with this, more recent challenges for this industry include:

New and changing customer expectations resulting from technology disruption
Economic uncertainty and geopolitics
The competition for talent and digital skills, particularly within fintech
The changing (and more human) expectation of leadership, including building a stronger sense of purpose and community for employees
The ever-looming threat of data breaches and the need for improved cybersecurity

To explore how these factors are playing out in the employee experience for finance employees, we have highlighted three challenges that are having significant impact on employees and leaders.

1. Disruption from technology. The rise of financial technology has heightened expectations of a seamless, more integrated customer experience with financial institutions, products, and services. This, in turn, has meant that agility, digital proficiency, and a shift from traditional decision-making hierarchies is front of mind for finance organizations today. 25% of banking executives plan to lean into AI over the next two years, believing that it will be the most effective technology to improve the customer experience (BDO, 2023). Employees are feeling the impact of this with higher workloads where everything feels like a priority, the need for upskilling, and having less clarity when it comes to points of accountability or decision-making authority.

2. War for talent. Previously, financial organizations may have relied on extrinsic motivation such as pay to attract and retain talent. However, today employees, particularly younger talent, have higher expectations around career growth, work flexibility and being purpose driven. Inclusion and the ability to speak up (psychological safety) are also common themes yielded from employee survey feedback in this industry. Many of these expectations are being met in other industries or sub-industries. For instance, 78% of fintech organizations offer fully flexible work schedules (Scoop, 2023).

3. Changing expectations of people leaders. To tackle industry disruption, there is a need for both ‘hard’ skills (digital proficiency, agile product development) and ‘people’ skills (leading change, creating connection and collaboration, fostering innovation and agility). For leaders in this industry, there are now stronger expectations to have a learning mindset, over one of command and control, and a preparedness to adapt and pivot where necessary.

As a People Science team, we recommend focusing on these three areas to improve the employee experience in this industry:

1. Use employee feedback (survey and systems data) to understand and address high workloads, barriers to agility, and decision making.

Stay ahead of employee burnout by continuously listening to and acting on feedback about workloads and wellbeing
Understand what aspects of the organizational culture (values, structures, processes) are hindering agility and execution for all levels of the organization, including senior leadership and executives
Challenge ‘command and control’ hierarchies so that teams are empowered to make decision.

2. Provide an employer value proposition that emphasizes purpose, growth, and flexibility.

Connect your strategic priorities to a meaningful purpose (e.g., social and environment impact)
Emphasize cultural values by role-modelling from the top
Define career pathways and ensure managers prioritize regular 1:1s with employees
Review your hybrid and flexible working policy. Are you truly bringing employees into the office for those moments that matter?

3. Reconsider your leadership profiles and competencies and assess whether they are fit for purpose in today’s world.

Celebrate leaders who bring teams across the business together for true connection
Emphasise the right balance between empowerment and accountability for managers of teams
Focus on driving efficiencies in decision making, processes, and ways of working
Embrace leaders who show a learning and inclusive mindset

A downloadable one-page summary is available below for you to share with your colleagues and leaders.

Please leave a comment below to let us know if this resonates with what you are seeing with your employees in this industry.