TalentHive: Digital Talent in Financial Services

From Employment Gap to Talent Development

The accelerated digitalization and automation of our work environment is also called the “Fourth Industrial Revolution.” This digitalization has been going on for some time now, but the recent technology breakthroughs and the continuous accelerated introduction creates an increasing insecurity about the consequences for everyone—not only in our daily life, but also for our job content.

Through the collaborative innovation platform B-Hive, we will we set up collaborations and initiatives to meet the challenges of digitalization. The platform includes the main players in the financial market; banks, insurers and market infrastructure players, along with technology companies as well as various public partners and the government.

One of the tangible areas in which we work is talent. With the TalentHive program, we focus on mapping and strengthening the talent pool in the financial sector in Europe. This exercise aims to ensure that today's talent is equipped with the right skills and experience to address the digital challenges in this sector.

The digital transformation of the financial sector

The financial sector is no longer considered as much of a steady job industry as it was 20 years ago. In the past, people would stay with a company for their entire career. Employees were loyal to their employer and vice versa. Given the banking crisis and rapid emergence of new technological possibilities, banks and insurers had to redefine themselves as technology companies. This economic reality and the radical technological evolutions have had a major impact on their business models and in job security. Look at the recent restructuring of big players in Belgium on the financial market, for example. Different options are therefore considered an enabler for people to work outside of the financial services industry, whether or not retaining their wage at their current employer.

At one end of the spectrum, millennials form an important part of our labor market and the number of staff will continue to grow as well. They bring a different background to the financial sector; their technological interests, networking, real-time online and mobile communication, their worldly vision and their entrepreneurial spirit. They like to take matters into their own hands when it comes to their lives and careers. In addition, they possess many digital skills and want to use and strengthen them in their working environment. Young people also want to face new challenges within work and are not satisfied with repetitive tasks where you do not need to think in an extensive way.

The latter will furthermore be facilitated by the technological evolution. A clear example is the deployment of staff in relation to the use of artificial intelligence that currently allows companies to roll out reports and analyses, that previously required specialists. The technology generates these faster and are more accurate than any other team. It is now up to the employer to see how his analysts are deployed to create added value to these automatically generated reports. For many large companies, this is a challenge they cannot yet respond to as they are self-learning on the digital and technological front. It is clear that both sides are not yet aligned with each other.

At the other end of the spectrum, the financial sector has a large workforce of the 50+ age group, who are expected to work longer in this new environment. Most of them would not be open to digitalization in the financial sector; let alone implementing and applying the new technological trends.

Burnout and bore out are more present than ever in the workplace in both groups, so we can derive that there is a mismatch between personal ambitions and expectations and the job content itself.

The challenges of the financial sector

Digitization will lead to new types of jobs as the changing market and technology demand new business models. An example of this is the training of machines and robots that will drive the "chatbots" afterwards or provide the aggregation of data. All of this will be new positions in which we do not have a clear view of today. The necessary flexibility will become crucial in order to survive.

Employers must learn new skills, such as highly reactive and inclusive interactions with clients. They are needed in the future work environment because technology has created a real-time profile of the same customer across the different departments.

In this context, soft skills will increase with a focus on flexibility, openness, communication and building bridges. Digital transformation does not mean that everyone has to learn to code. The new platforms will assemble and organize all the data, but it will also be up to the employee to make the right links and connections and transfer them to the customer. That human understanding will hopefully gain importance.

Employers cannot fill in current vacancies for these types of jobs because they do not find the right profiles on the market. There is a clear shortage of people for this new type of jobs due to lack of education and retraining. Nor will they have enough people within their own talent pool to complete all the vacancies—again creating a mismatch.

What are the focus points of digitalization?

Digitization will sooner or later impact every process and person active in the financial sector. It is getting faster and wider. In June 2016, Europe published the "New Digital Skills Agenda," indicating that 90% of all jobs in the not so distant future will need some form of digital skills. 40% of today’s jobs in Europe currently have no need for such skills. Let it be clear that each of us will be impacted. The question is only to what extent and by which technology. The job of an office worker will be more impacted than that of a software developer, but it will also be partially replaced by AI and will work at an abstract level. For the human resource employees themselves, new tools will be available for real-time and data-driven work.

So, let's not see technology as an enemy, but investigate how it can be used positively in our daily lives and jobs. We already notice that digitalization and the possible flexible and mobile working models make the fixed-office boundaries and hours fade away. What needs to be clearly put into practice is the adequate deployment of staff: a higher quality of matchmaking between the position and the person. Employ people in the function of the added value they can deliver rather than have them perform repetitive tasks - in addition to the work of robots, chat boxes, etc. People should be able to distinguish themselves from the machines in this post-industrial era.

The work will also be organized more and more by rotation teams and no longer by department. People are then brought together according to the intended end result and project in order to deliver good work, based on their own skills and how they are complementary to each other. This means that there will be much more rotation, more interaction and thus will make work more flexible.

Such teams will no longer be hierarchical, but will instead divide the work as a self-managing team. People will get more control over the content and the way they will perform jobs with a much greater impact on the end result. Self-management skills will be crucial in the future for every employee, just like the case today with self-employers and freelancers. Studies indicate that this will also have a positive impact on job satisfaction and control of potential stress factors. All this regardless of age, experience and skills.

Focus on skills, not only on tasks and knowledge

In a rapidly evolving technological environment, the question is no longer how much experience you have in order to execute a particular job. The question will also no longer be whether you are adequately trained. Given the current talent pool, we know that we can place qualitative people. Rather, the relevant question will be whether or not the employee has a skill set that matches the job and the technology in which and with whom they will have to work. Skills evolve, grow and adapt to the context in which they are deployed. This will provide more opportunities for filling out open vacancies with links that are not obvious, like the deployment of an older employee with experience in administrative support in a new job regarding cybersecurity testing and deployment where accuracy, punctuality and attention to detail are indispensable.

Today, we are able to identify people's skills through assessments, job experience and other techniques. The crucial question is whether or not employers are able to identify job opportunities that do not just list what is expected, but also provide a description that identifies the challenge, describes the technology and indicates which talents are needed to make progress. Once we speak the same language on both the employers’ and the employees’ side, those with the talents, they will be able to do qualitative matchmaking and use the right people in the right place, complementary to the latest technological means.

Are there also tasks for the government and other public players in this regard?

Definitely; New business models, new technology, new skills and new expectations on job content also ask for new structures that can be worked out.

Formal Learning Tracks should be encouraged: not only if you are without a job, but also from an existing position. People should be encouraged to keep learning, not penalized for social/pension rights but instead be able to retrain with a social safety net.

Sharing knowledge should be the essence of our daily job and thus our knowledge economy; about ages, positions and business boundaries. Only then will we acquire advanced insights, deliver creative solutions and build on the constantly evolving technology. The government can help and stimulate employers to effectively share knowledge. Utilize the older and very valuable talents so that their knowledge can be the basis upon which others can build. Use their knowledge to critically study and evolve technological evolutions where necessary.

Learning by practice and learning at work, job shadowing colleagues, coaching and mentoring; not only within companies, but also across business boundaries. From a big bank to a technology starter, from university to private, a school graduate following a 55+ course during an internship. Also, from the VDAB this can be considered as the concept of “dual learning.”

People should be able to switch from job to job, from project to project. Such a transfer should not give an administrative burden to the concerned parties or should not employ three or more public institutions. Through technology, the government also has the opportunity to approach its working population digitally and thus faster, more accurately and in real-time.

Employers must work together at the sector level, just like the financial sector within B-Hive, on a neutral innovation platform where initiatives can be rolled out across companies. This can take the form of a sector-level study on workforce planning and reorientation, in which joint projects can be set up, or develop training courses for jobs that will be open to all companies from the same sector (e.g., data scientists).

If we look forward to issuing work permits and recognition of diplomas within the EU, then we conclude that there is still a lot of work to be done. Let's welcome people with knowledge from abroad so that they can build on our digital society tomorrow. They have the expertise and experience we lack and therefore need to be globally competitive. They bring new perspectives and other cultural influences and break through the "village" mentality through their mobility. It will only broaden and strengthen our own knowledge and position on a global scale.

The main implications for the financial sector in terms of employment, job content, knowledge and skills, employment relationships and working methods

Digitization becomes the norm. It is, therefore, crucial to include everyone in the current and future talent pool to ensure that they are digitally equipped. Issuing a "digital driving license" is one of the measures that is taken in the sector to ensure that everyone in the financial institution can use and understand the technology.

The organization of work will be done in teams that become self-managed. Such teams are drawn up in function of certain projects, dissolving results and achieving results. Rotation of people becomes the norm both internally and externally, positioning them with the best skillset to reach the goal. The financial sector will have to work across industry boundaries with all stakeholders, including technology companies, universities and service providers to realize such a rotation.

This flexible workforce lays the focus on talents and their skillsets so that they can evolve them over their careers: lifelong learning and taking responsibility of your career are necessary. Let us, as the government and as employers, define the chalk lines so that people can actively and positively work on their skills in the function of technological evolution. As with the centralization of customers in the new business models, the financial sector must not forget that their human capital are also "customers" with which they are expanding the business.

Essentially, it will be worth estimating human capital and put it as the focus in the business strategy. This is more about the mindset than the technology or the organizational limitations: creating a culture that focuses on innovation, growth, openness, speed and customer satisfaction. The World Economic Forum has also called on companies to embrace digital talent and skills, and to encourage such cultural transformation. Only then will the financial sector be able to step into a digital building block of our economy during and after this technological revolution on a global scale that we are confronted with.

Ellen Thijs, Executive Program Manager

Wim De Waele, CEO B-Hive