Is acquiring Digital Technology Skills the new challenge for Financial Institutions?

illustration depicting cloud migration
illustration depicting cloud migration

As customers continue to embrace digital transactions (a behaviour exacerbated by the Covid-19 pandemic), providing an intuitive customer experience together with a diverse and innovative product and service portfolio is essential for financial institutions to create or even maintain competitive advantage. This is particularly true for those more traditional organisations who have been slower to modernise their digital offerings, leaving them behind their more innovative, online peers.

The Tech Talent Challenge

Wherever you are on your digital transformation journey, whether you are a traditional high street bank or a start-up fintech, one challenge is essentially same - acquiring the digital skills and capabilities needed to drive your roadmap forward. With the world of work now dramatically changed with the spread of Covid 19, there has been an unprecedented wave of tech adoption across all industries as companies have learned to work remotely and connect with customers virtually. The fight to source tech talent is fierce with demand outstripping supply in areas such as cloud engineering, cyber security, app development and artificial intelligence. As a result of this new rising demand the costs of acquiring such skills will undoubtedly increase over the coming months. Organisations will also need to enhance their attractiveness to potential recruits.

Can you Compete?

Finding people with in-demand technology skills isn’t easy. As financial organisations intensify their focus on technology, they face increasing competition from other employers targeting people with the same expertise. Fintech companies continue to expand and are luring technologists with the promise of flat hierarchies, laid-back working environments, and sometimes equity stakes. Large Banks can face certain disadvantages when hiring when compared to other marketplaces as they are highly regulated, so their products take a comparatively long time to get to market. This can be off-putting to developers who prefer a faster pace of work. There is a perception that many large banks are technology laggards with dated technology stacks and even more archaic development approaches. This, of course, is often unfair as many banks, particular during the pandemic, have proven that they can innovate and deliver digital product and services at pace.

How can you look to fulfil demand in the coming years?

While traditional recruitment tactics may be adequate to boost attractiveness in the market in the short term, new initiatives are essential if banks are to attract and develop the talent needed to maintain competitive edge.

1. Establish a digital academy approach to develop future talent.

One way in which organisations can develop and nurture talent is by taking a digital academy approach, attracting bright, driven school leavers, graduates and others looking to develop a career in technology and giving them the training they need to take on in-demand roles. At Exception, we support our customers in developing this type of approach in a number of ways:

  • helping to shape the learning programme collaboratively
  • providing professional accreditations
  • providing on the job experience, allowing participants to practice and hone their newfound skills

2. Retrain existing staff.

By 2030, 14% of the global workforce may need to switch jobs as digitisation, automation, and artificial intelligence (AI) disrupts the world of work, according to a McKinsey Global Institute report. Upskilling initiatives, therefore, are a major focus for many companies to help retrain staff, giving them the skills required to move into in demand roles. One example of this is Mastercard, who are upskilling their staff to compete with start-ups, encouraging them to develop new skills through the learning platform Degreed.

3. Partner with third parties.

Another option is to engage with a Partner who can provide scale and flexibility by giving access to their own talent pool. This works well if you are looking to add niche expertise or accelerate a programme and don’t have the time or resource available to recruit. This can be viewed as a lower risk model than recruiting as you are not increasing headcount or committing to long term overheads. The likelihood of getting the hire “wrong” is also lessened as if someone is not the right fit, the onus is on the partner to bring someone else in who can fulfil the role.

While none of these options will solve the technology skills gap on their own, a strategy that combines all three could provide an organisation with the immediate support they need (working with a partner) together with a longer-term way of fulfilling demand for technical skills (academy and staff re-training). The banks that are able to get this right and develop a sustainable model for securing and developing talent are likely to come out on top and gain highly coveted market share.

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