Insights From The Banking Sector

February 6, 2023

We recently had the pleasure of talking with Alice Crawley, who works within the banking sector within Australia. We discussed a number of industry-specific quirks related to change management in the context of banking, as well as the current challenges that change management professions are facing within the industry.

Some of the key areas we discussed were the drivers of change in the banking and financial services sector and the associated challenge of balancing 'tension of opposites', the shift in focus from developing competency to changing behaviours, and leadership buy-in from the executive level down through middle and lower layers of business to facilitate culture change.

Below is a transcript of our conversation. Have any thoughts, questions, or comments? Don't hesitate to get in touch with us on our website, or via social media.

Estimated reading time: 15 minutes


Welcome to Matae’s ‘Talking Change.

Today I'm really excited to be talking change with Alice Crawley and hearing her insights about change management, and specifically change within the banking sector.

Before we kick off Alice, can you please tell us a little about your background and experience?


I've been working in the space of culture and change consulting since arriving here in Australia from Canada twenty-two years ago. I've spent a lot of those years in the banking sector, and have had the privilege and honour to work on some very large scale technical, business and cultural transformations across both private and public sectors. I have a background in psychology, and I'm very passionate about the ‘people’ aspect of change. I believe people that are designed for change organically find their way to change, and I think I was always one of those people. I believe I was practicing change management before we even had a language for it in the industry. There was always a kind of project management, and then we started dealing with all the people stuff, and the engagement.

So I've been in the game for a while and have been involved with a number of multi-organisational mergers. I’ve been with my current financial institution for five years; starting as a consultant and then joining as an employee, largely because there was an opportunity to go really deep into culture and behavioural change.

I think it's really interesting people talk about soft skills and change management. I know that you would be acutely aware that it's not the soft and easy stuff at all, it's actually all the hard stuff, delivering the technical and the business implementation. But what I find really fascinating is how do you help to shift people's behaviours - their mindset and their psychology; to bring them on the journey so you can be successful with implementing change and culture.


Because I know you're a wealth of knowledge, can you share a little bit about what you see as being the key drivers of change in the banking sector currently in Australia?


It's a really interesting time to be working in the banking sector, and I think there are a few reasons for that. There are a lot of drivers, on the back of the Royal Banking Commission, the risk regulatory compliance and security breaches have brought a lot of complexity, but also some very critical drivers into strategic priorities across the across the banking sector, I think it's been a great opportunity because for many years, people culture might have been seen as like the fluffy ‘nice to have’. It's put culture in the spotlight because most of the banking institutions and financial institutions across Australia now have reportable requirements and compliance agreements that they need to meet with all of the major regulators.

And it’s not just within Australia, it’s internationally. It’s a huge driver for change, and it's added a lot more work for a lot of people. It's meant a lot more resources have been on board, so that's definitely a key driver. I think the second driver is because of the breaches, and the issues that that came out of the World Banking Commission and the compliance, security and the regulatory requirements, there’s been a process that most of the banks have had to go through around regaining trust with customers as well as building trust. But I think that regaining of customer trust is a big driver for how we create our culture because it's not only how we do things and how we all feel about each other, there is a very direct impact on how much customers trust us. Ultimately they're entrusting us with their money and we need to make sure that we build those high trust relationships, so I think that's a big driver because it’s not just the feel good factor, not just all the other benefits that come out of high trust, but if any financial institution is going to keep a competitive edge, they need to find a way to build that trust. You can't create high trust with customers and keep a competitive advantage if you are not living and breathing it with your organisation. I feel very strongly about that, so that's been a big driver as well. And then finally, there’s been a big shift around COVID.

What happened with COVID, we've had to shift to hybrid working and then of course that’s another driver around culture. It isn't unique to banking, but it has had a knock-on effect around key considerations around strategic priorities is the attraction and retention of high talent, and that's become a real pressing driver around how we run our business. Of course, throughout COVID we’ve also seen the great resignation as they call it, so that's been a big driver for change as well. So I'd say those are three of the big drivers.


That’s fascinating. I’m also interested to hear more about how you shift culture to achieve the requirements for your license to operate, but at the same time, build a customer brand and an employee brand, because there are some conflicts when I think about the dynamic of those things. Tell us a little bit about your thoughts on how you strike a balance between license to operate and making sure that you're still driving those outcomes that will attract clients or customers and will attract the right level of talent to the bank.


That is definitely one of the biggest challenges that we face into the banking sector. It is a balancing act, and I don't think that any of us are doing it perfectly, and everyone's learning as we go. I think there's a few different dimensions to that; I think that the risk regulatory compliance requirements, needing to up-skill and create awareness and ensure compliance at scale, particularly for the larger financial institutions when we're talking about the big four, for example, that’s a big challenge. There's been a lot of heavy lifting in that space over the last couple of years, across all the banks in Australia in terms of up-skilling, as well as needing to up-skill, build capability, keep up with customer demand - customers have more options than ever before, so keeping everybody at the leading edge in terms of digital facing into the data tsunami, given the complexity of banking, that's where it's really tricky. So in terms of how we keep up with these trends at scale, I’d say it's still a work in progress. But what I am really happy to see, having been in the banking sector for so long, is this is the first time in my career that I have seen such a focus on the behaviours, and the emphasis, from top down, bottom up, inside out around how our people, our leaders need to be thinking and how they need to be approaching things and being less task-focused and more people-focused.

It's a long journey and anybody would know that for any sort of culture change, you’re looking at three to five years to really change the game and change the culture. But it does mean that we've had to open our minds and be more curious and really stay on top of external trends and who the organisations are that are doing it well and drawing on their expertise, and taking a truly multi-dimensional approach in terms of how we tackle it.

I would say the tension of opposites around the increasing pressure and scrutiny on what we need to do to keep our licensing and be a highly effective, efficient operation and the balance of making sure that we're staying empathetic, that we're creating psychological safety, that we’re being really present and connecting with our people as well as our as our customers.

We’re at the point where there is a recognition at scale that it’s not just a ‘nice to have’, but if we don't have it, we will fail. To me that’s what makes it a really exciting time to be in the industry. That acknowledgement that we do need to do all things. It puts a lot of pressure on the leaders and I don't envy them, it’s a tough gig, but then in a lot of ways, everybody has a tough gig right now because they are holding that tension of the opposites.


I really love that dynamic between that tension that you describe between license to operate, actually acknowledging that the people side is equally as important. It sounds like the commitment from senior leadership, and the resources, are there so for a change person and someone who loves the space it's an exciting time to be able to ‘play’ in change.

I guess one of the really interesting things I picked up from what you were saying was the volume of capability that you need to build, and the shifting that to behaviours, and that that needs to be sustained in the culture. And it’s a massive challenge when you've got a number of different drivers where you're trying to grow capability for employees. And then you're trying to shift behaviour over, whether it's digital, whether it's license to operate, or compliance requirements, whether it's remote working or hybrid working environments. How do you look at managing that within a large organisation and how do you keep alignment and focus when there's so much?


It's challenging! However, where I feel we're making a lot of progress in, and where the dial is shifting in the right direction, is the acknowledgement. The exec airtime that is critical to any changes – the tone from the top - is now being set in the right way, as well as blending that with bottom up. What I'm really happy to see - and it hasn’t been easy, it's taken considerable effort and focus and lobbying for support and advocacy – is that we now have a common language and a common understanding that we're not simply talking about future focus skills. This is a lens that a lot of organisations are putting over it because they need to attract and retain talent - regardless of whether that person stays there or goes somewhere else, they have to develop the skills and the behaviours of that individual. And again, there's a multidimensional approach around that.

So from a from a pure alignment point of view, at a board level there needed to be that strong business case that we're talking about behaviours when we talk about future focus skills. We're not just talking about the latest tools and technology, or talking about having a digital mindset, we're also talking about the importance of the right leadership behaviours, and I think that's been the big shift in the last eighteen months to two years. It’s critically important, how I talk to my people, how I connect with my people, being present, listening, following up, honesty, building high trust - all of those behaviours. In the culture space, it's been a very deliberate and conscious campaign around understanding that the leadership behaviours are intrinsic to the skills. You can't simply send somebody on the training course and think you’re good to go. Where I feel we're getting a lot better is drawing on expertise from the leading universities, tapping into the intel we're getting from the Harvard Business School and really looking at what's leading edge.

What we're working towards a lot more now is how do we integrate that into the flow of daily work? Even when we're doing it to the best of our ability, it's still overwhelming. That's a hot topic. It means that we're taking more innovative approaches around learning, practicing, reflection.

So rather than sort of saying, let's just use innovation and that whole principle of making it safe to fail. That’s a pretty common notion that that any organiaation that operates in an agile way understands is critical to their success.

People need to understand the principles of agile, and an agile manifesto. They need to know what agile with a big A and little A is, and how to embed that and reduce the pressure on people in terms of how much training and up-skilling they need. ow. Here are some principles and go and apply that with your team and doing these you know doing these workshops, doing learning sessions, having these interactions with experts to help people really integrate it into how they think, how they feel and how they do things. I think that's where the energy needs to go.  People need to actually practice it and live it and breathe it, top down, bottom up and inside out. In a lot of organisations I've worked in, things get stuck at the  top end, and the middle layers are getting really squeezed and people at different levels aren't really getting the message. So I think this approach of really coming at it from all angles and being open to outside in as well as shifting the mindset and the behaviours inside out is where we're starting to see traction.


I love that 360 degree concept of the way you've got to approach change. You talked about a 360 approach and a very agile and flexible approach to building capability and you talked about the leaders and their role and getting them on board to create those environments of trust and do those things that actually enable and drive the right behaviours at the frontline. In terms of the banking sector, what challenges do those cultural norms that have become legacy look like and how do they make it more challenging? What type of barriers do they throw up?


The last couple of years has really been the first time in my career that I've seen such significant shifts around culture and it’s been sort of by organic design. When you're dealing with well-established organisations - and there are many long-standing financial organisations in Australia - there are behaviours that are hardwired. And I think the best way that we get the message across is by linking it to KPI's and strategic priorities. That's the pitch we've got to give. It's going back to that fail safe and fail fast example. You get leaders who know the neuroscience, they know they need to be present. It's actually a behavioural focus at the moment. It helps that it’s been really put under the microscope and been tackled specifically with some really courageous conversations.

Empowering people in an organisation and flashing it up on the walls that if you're seeing something that isn't lining up, call it out. And if that's an issue, these are all your channels of support. It might sound a little egregious, but if we're going to break down those really old behaviours that are ingrained, particularly with people that have been with long-standing organisations for a long time, I think you need to be.

Another challenge comes back to that balance of the opposite, or the tension of the opposites, and getting that cut through. We need to make it clear and be quite explicit.  We're dealing with incredibly bright, talented, highly educated people, I heard it once described as sort of the Genius Leader syndrome. People can be technically brilliant but they're not necessarily the best person to be interfacing with everyone else. We need  to cut through the complacency, or that sense that you know it all. If we can't demonstrate that we're doing that behaviourally as a culture, we'll be shut down. So it's needing to make it abundantly clear that we won't succeed as an organisation and we will perish if we don't make those shifts.

Carol Dwork at Stanford University talks about growth mindset - fixed versus growth mindset. An example of the fixed mindset could be people that have been in the industry or an organisation for a long time. That's where we hit the guardrails. Another great example would be EQ, people talk about whether you’re born with EQ or you don’t have it. But we’ve been doing some amazing stuff with the guy who created an emotional intelligence program for NASA, and it’s getting people’s attention - if the NASA astronauts needed training in this to make sure that missions didn't fail, maybe we need to pay attention.


I love the comment around prioritising the behavioural component of any change because I think it's so important, especially around culture. I've heard you talk about the systems that are required in terms of aligning KPIs and those type of things, but also the emphasis that you put on the feedback mechanisms and being able to have those constructive conversations. Pulling those things together to drive change, especially in institutions where you've got significant legacy around behaviours and culture, is really challenging.

What are your biggest ‘aha’ moments from working in the banking sector?


I think there's two things. One I would say is, the more you can connect people with a sense of purpose and a sense of meaning and relevance around what they're doing, the better result you're going to get. That’s for any industry. The best leaders I've seen are the ones that can do that well. An example of someone who was the most influential leader in my financial career was an absolutely extraordinary woman. She was very senior, extremely successful, and she had people's respect. People wanted to do great work for her, and we know that that's a principle in leadership. But what she taught me is that no matter how many things she had going on, even if she only had thirty seconds to have a conversation with me, she would pause and connect with me in a way that showed such respect and depth. It was absolutely extraordinary and to me it was a game changer. I realized that what I need and respect and appreciate and admire so much in a great leader is to talk to me like I was the only person in the room. What I took away from that is never, ever underestimate the power of connecting with people in a really meaningful way. And connecting at depth is transformative.


It sounds so simple, but often some of the most simple things that I think we do, especially in the world of change and around people, the most powerful things really come back to those basics - can you be present with people? Can you be there in the moment? And if you can do that, what's the impact that you can have to support people through change and during times that are typically turbulent. There's so much value in that.

It's been awesome to chat to you and I've loved listening to you and hearing you share your insights. Thank you so much for being with Matae’s Talking Change.

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