Virtually every large financial services firm has spent some time in the past five years either designing or enhancing their job architecture to address everything from unbalanced organizational structures to improving the employee experience.
Relatively inexpensive for the benefits this exercise can yield, we’re offering the top 10 reasons why you should consider examining and adjusting your firm’s job architecture. We’re also sharing positive outcomes you can expect for the work you put in.
Many financial services companies struggle with top-heaviness, also known as title inflation. Over time, the intended grade pyramid starts to look more like a cylinder — or worse! An integral part of job architecture is leveling criteria and governance around promotion processes. For larger financial services firms, cost savings related to solving for these types of issues usually is in the tens of millions of dollars. And, besides the cost savings, there are plenty of additional benefits to being less top heavy.
Pay equity is a universal concern among financial services companies. As firms conduct audits and analyses, it is critical to compare employes in like jobs for equitable pay. This means going beyond calculating average pay based on gender, race and so on.
Career inequities, promotion inequities and more are important problems to solve. To adequately test for and measure pay equity, you need to know the jobs that your employees are in and at what seniority level.
Pay transparency is another universal concern among financial services firms. As regulatory requirements increase, it is becoming more important for organizations to understand the roles and associated pay opportunities within an organization and then share this information externally.
Nearly all large financial institutions are in some stage of digital transformation. When looking at tech headcount as a percent of overall headcount, the number has more than doubled in the past 20 years.
To do the requisite planning for the workforce of the future as well as create roadmaps for upskilling legacy staff, financial services firms need to understand the current-state roles, they roles they likely are to have in the future, and the skills that will be required. Skills almost always are in-scope in job architecture projects, whether in the foundational development phase or as a phase-two priority.
While many larger banks have asked most staff to return to the office, there still is a meaningful population of employees working remotely at least some of the time. With managers and staff spending less time together in person, it is critical to have clarity around roles, expectations, objectives and so on. A developing aspect of job architecture is goal libraries, where performance management processes are supported by job definitions and associated goals.
Risk, audit and compliance issues are always a focal point in financial institutions. Job architecture helps the compliance team identify cohorts of employees for training and various regulatory-related areas.
Financial services firms were early adopters of offshoring, however there are a slew of new opportunities and concerns arising in the general category of organizational design. Financial institutions are seeking to explore domestic, low-cost talent hubs to reduce people costs via AI solutions, contractor vs. employee models and more. The analysis and planning for these types of shifts rest on a foundation of job architecture and clarity around where and how work is getting done.
While tech firms were faster to embrace skills as the baseline currency of how work gets done, financial services companies are quickly seeking to explore the possible benefits of a skills framework. Early adopters are finding positive impacts on learning and development, upskilling and, perhaps more importantly, career progression. Effective career progression reduces unwanted turnover and saves on costs.
Most larger firms have experienced an acquisition in the past few years, particularly in the retail space where there has been significant consolidation over time. Integrating these new entities is fraught with challenges absent a robust and well-designed job architecture. Conversely, firms that have invested in job architecture development find integration easy and intuitive. Additionally, new joiners ramp up more quickly with clarity around their responsibilities.
Over time, career progression has eclipsed pay as the greatest driver of employee engagement in the financial services industry. Employees want to know what they need to do to progress in an organization, where the lateral opportunities are, the required skills, available development experiences and more. More frequently, organizations are building employee “self-service” models, where staff can access job architecture content and more actively own the navigation of their careers within an organization.
Though they are the top 10, the list of reasons that financial services firms are revisiting their job architecture and job leveling work goes on. And, once that work is complete, the list of benefits goes on too.
