Addressing skills shortages is a constant challenge for tech leaders at financial services organisations, as the required capabilities evolve to meet developing digital transformational strategies and new fintech competitors. Finextra speaks to Sean Farrington of tech workforce development company, Pluralsight, and spokespeople from major financial institutions to explore how these challenges are to be addressed.

According to research by PWC, 76% of CEOs in financial services see skills shortages as a threat to their growth prospects. This is compared to 50% a decade ago. 

As digitisation at financial institutions continues and accelerates due to the events of last year, tech leaders are faced with the increasingly important task of mapping required skills against the organisation’s broader technological strategy.

Sean Farrington, senior vice president EMEA at Pluralsight, describes this as “closing the gap” between skills capabilities and business goals.

Chief technology officers and other tech leaders in the financial services industry must appraise the current capabilities they have at their disposal, where the gaps are and how they are to be filled to meet the business’ technology strategy.

Skills and strategy

Tech leaders are faced with the challenge of focusing on capabilities that can be applied to both the business’ current priorities as well as its broad strategy and the needs that may emerge further into the future. 

“We bring together new learning and new technologies and new communities to prepare our people and customers for what comes next,” says Zoe Williams, head of learning technology at HSBC.

“Regular reviews take place whereby we identify the skills that are required to deliver on the technology strategy. As part of that we assess the availability of those skills and adopt a build-and-buy strategy to ensure the required skills are available to deliver the strategy.”

Tech leaders should therefore plot their journey, starting with business strategy, identifying the technologies that will enable it and then finding the skills needed to bridge the two.

“They need to identify where they are today and where the gaps are,” Farrington says.

“So, you complete an inventory of your existing technology workforce, identify what key skills are missing and then close those gaps.”

Banks may decide to view their required skills in a very broad sense, in order to accommodate the changing face of technology within digital infrastructures, thus avoiding backing themselves into corners should their broader strategy need reassessing.

This can be achieved, according to Farrington, with a “personalised learning journey” for each individual within a business to map out what their existing skills are and where they need to develop to contribute to the business’ strategic goals.

“If you replicate this hundreds or thousands of times across an organisation, you get an inventory of existing skills and an understanding of where your gaps lie,” he says.

“If you understand that, you can understand what the barriers are to you driving your strategic outcomes.”

Skill assessment

As financial service companies’ strategic priorities change, so too do the necessary skills capabilities, given how the industry can change from one year or even one month to the next. Looking at how banks, insurance companies and their peers have had to respond to the whirlwind events of 2020 shows what a complex task assessing required capabilities is.

“The future of work is already vastly different than just a few years ago,” says Hans Brown, head of enterprise innovation and chief information officer for corporate technology at BNY Mellon.

“With client needs and technology evolving at a rapid pace, we must become more agile in our response to these shifts.”

This is where smaller players and challenger banks may have an advantage over incumbents due to their smaller payrolls. Tier 1 banks will of course have far bigger employee numbers which may limit their room for manoeuvre should they need to expand teams or reinforce certain areas of the business.

At larger organisations, however, the first option should be upskilling or reskilling. 

Their tech leaders should therefore be seeking tools and programmes that enable employees to assess themselves as their skills pertain to particular roles.

“We’re trying to leverage tolls and make training and assessment more consistent across our organisation,” says Kris Harris, managing director in technology, data and innovation at Deutsche Bank.

“This establishes more of a baseline which enables comparison between people from a competency, skill and expectation perspective. Going forward, this will allow us to make much better assessments in terms of the capabilities we have.”

The next step is to define roles within the organisation as they pertain to the strategic business outcomes, which requires an assessment process to measure proficiency levels.

“From here, you are able to quickly sort and understand competency levels in particular skills and stack them together to create a vision of a particular role,” Farrington says.

This helps plot the learning journey for the individual and informs the tech divisions of the business where the gaps are. It will also provide a road map for how long it will take it for them to attain the blends of roles that they have identified as being critical to completing the transformation they wish to achieve. [ND1] 

The key skills

The challenge for FS firms is to identify  what skills will be required in technologies like AI and blockchain. These promise much for innovation but are still relatively nascent, particularly those with legacy business models, systems, and processes.

“The changing business environment requires individuals who can communicate effectively, apply problem solving and critical thinking to drive digital change and foster an innovative spirit,” Hans Brown says.

“Innovation requires a certain level of personal courage, an ability to bring in a diverse set of voices as well an environment to rapidly experiment.”

This demonstrates the broad approach that should be taken with regard to the skills and capabilities sought. Firms should be seeking people who can demonstrate a buy-in to the culture of innovation, continuous development and improvement, rather than the technical prowess that these emerging technologies would appear to demand. 

“AI and blockchain are hot technology areas where we see a lot of emphasis and activity among the users of our platform,” Farrington says. 

“What we’re seeing though is that they are part of a broader conversation of creating roles that can harness those technologies to navigate what may lie ahead in the future.”

Considering the pace of digital transformation that can be expected in the years ahead to negotiate challenging economic circumstances, organisations should be looking to achieve a people-positive approach with dynamic individuals who demonstrate self-starting and self-improvement behaviours to slot into teams that can tackle ever-changing challenges.

How to bridge tech and L&D

For these goals to be met, the relationship between tech leaders and the learning and development (L&D) area of the business is an important one.

Both need to be harmonised  in instilling a culture of evolution and growth to meet the pace with which technology changes. 

“There has to be a very close working relationship, because technology evolution is one of the key areas that will define the future of the way we operate the business, work together and serve customers,” Zoe Williams says. 

An organisation could have a best-in-class technology skills platform, but if there isn’t the leadership in place to encourage, motivate and engage with technologists to actively participate, then it will be difficult to drive value from it and achieve the desired business outcomes. “Technologists are, if you like, the customer in terms of being the ones who need the skills to do the work that empowers the organisation’s digital transformation” Farrington explains.

“In that sense, L&D are like the sales team. They need to be the domain experts who ensure that the platform is delivering the best possible experience and navigate the human factors of the whole equation.”

This will help create the necessary environment and culture of learning and continuous improvement that drives the maximum value of a skills platform like Pluralsight.

You can dive deeper into the key skills challenges facing tech leaders in financial services and how to overcome them in Pluralsight’s new eBook ‘The Power Within’ available for free download.