Your bank’s culture matters … a LOT. Of course, you already know that culture permeates every aspect of your operations. Although it can seem like an abstract concept sometimes, here’s some concrete perspective on just how much culture matters to the bottom line. A 2020 article from Gallup found that employees who are not engaged cost their company the equivalent of 18% of their annual salary. So YES, culture is a big deal. Good news: if your bank’s culture is broken, it can be fixed. In fact, working on culture is one of the easiest and fastest ways to bring money right to the bottom line—but only if you know what you’re doing.
Only 50% of Banks Will Survive to 2025: Fix Your Culture and You Can Even Thrive
We’ve seen massive consolidation in the banking industry in the recent past, going from 18,000 banks down to 5,000. If the trend continues, I predict that only 50% of banks will survive to 2025. The ones left standing will prevail not because of their size, or how long they’ve been around, or even because of how their numbers look. The ones that will prevail will be the ones with a culture that can both generate and sustain sales, profitability and growth.
What is culture, really? Is it a happy little feeling deep inside? It is that,but it is also so much more than that. Culture is a series of systems born of the organization’s values. It aligns behaviors, drives performance, and creates results. In a nutshell, culture is best described as, “This is how we do things around here.” It’s that fire in the belly to make great things happen.
In a strong bank culture, when the impossible needs to happen, people say, “Bring it on.” They feel that “everything is figureoutable.” Their motto is, “We can do hard things.” That’s more than surviving … that’s thriving.
But for that to become a reality for you, you and your bank’s executive team must bust the five culture myths that crush performance and profits.
Banking Culture Myth #1: “I hire good people and get out of their way.”
It’s our fault if employees are left to wonder what’s expected and think that simply being “busy” is an indicator of performance. Who cares if the number of new accounts is growing if those accounts will never be profitable and are demanding you match rates while giving you only the crumbs of their business? When you create a strong culture, every team member knows precisely which actions to take to reach the important metrics that tie in to the strategic plan.
Banking Culture Myth #2: “Culture is a feel-good ‘happy bus.’”
It’s not such a happy bus if everybody’s happy but the bus isn’t going anywhere because we’re not tying our team’s happiness to sales and profitability … and then we have to lay off their friends and freeze their salaries. That’s not happy. When you create a strong culture, employee happiness is a consequence of knowing that what they’re selling makes a valuable and important difference for their customers and community.
Banking Culture Myth #3: “Culture is solved with sales training, goals, and incentive pay.”
Sales training, goals, and incentive pay are extrinsic rewards. What closes the gap between where you are and where you want to be performance-wise are intrinsic rewards like purpose and contribution and personal growth and feeling they’re making a difference. The things that move and motivate people. The things they’re really about at their core. When you build a strong culture, every team member believes in your organization’s purpose, has a burning desire to achieve it, and trusts they’ll be supported as they work toward it.
Banking Culture Myth #4: “Culture will plummet during pandemics, economic downturns, and other disruptors; it’s inevitable.”
If it does, it’s an indicator that you’ve let go of some of your cultural systems or you’re not working them properly. Culture is more important now than ever before. With some employees working from home and some working on site at the bank, a weak culture is fertile ground for resentments and misperceptions to grow, leaving each group feeling that they have the harder job. A strong culture will get you OUT of the binds, keeping everybody happy and productive during good times and bad.
Banking Culture Myth #5: “Learning is a luxury.”
Every employee needs to be on such a profound learning path that they will improve their effectiveness 10% or more every single quarter. If you’re not growing employees to knock it out of the park on their current role and prepare for that next job, not only will your results suffer but you are also going to have a serious executive shortage down the road. When you build a strong culture, everyone is committed to continually learning so they can provide even more value to their customers and community.
Is your bank celebrating cultural breakthroughs, keeping your best people and best customers, and racking up the right kinds of sales to hit key profitability indicators despite the Great Resignation of 2021? Banks thrive and outlast economic and labor force uncertainty by building a culture that ties each team member to profit on a daily, weekly, monthly, and quarterly basis in systematic ways. REGISTER NOW for the replay of our Culture Mastery Webinar, where you’ll learn what only a few bank executives know about creating engaged, accountable, consistently high-performing teams.
Herway, Jake. “Increase Productivity at the Lowest Possible Cost.” Gallup.com, Gallup, 20 Nov. 2021, https://www.gallup.com/workplace/321743/increase-productivity-lowest-possible-cost.aspx.