Saturday, November 21, 2015

Bankers: Five Ideas to Create a Learning Organization

To get into the holiday spirit, I recently read a short story by William John Locke titled The Story of Three Wise Men. A story of three academics drawn to a country cabin where they delivered a baby to a dying woman. In the book, the author wrote the wise men "had grown old in unhappy and profitless wisdom". In other words, their experiments and theories benefited nobody, as they were all recluses.

I witness lots of wisdom when I interact with bankers. And I wonder, how do we avoid it being "profitless wisdom"?

My answer: create a learning organization. Here are 5 ideas on how to do so.

1. Hire for attitude, reward for effort and results.

So often we look for those with experience. Be careful what we ask for. Because with experience comes entrenched ideas, old habits, and know-it-all ism. There are benefits to experience, as the new employee will be productive quicker. But they are bringing their past culture with them. Instead, consider hiring someone eager and hungry to learn. Someone that is positive and others like to work next to. Someone that will be a builder of your learning culture, not a breaker. 

2. Have a baseline training curriculum.

Do you have a training curriculum by functional position that gives employees the tools to succeed? Based on my experience, I doubt it. You probably have compliance and operations training, because it's required by regulators and needed for employees to function. But do you match the rest of your training, if there is a rest, to your strategy and the job description? Training should start with an orientation program that shows employees the culture you are creating, how to function within it and nurture it, and what your bank's "way" is... i.e. how to answer phones, interact with employees, solve problems, etc. Beyond orientation, do you enroll budding credit analysts in Credit Admin school? Do you use a "test bank" to build a disciplined OJT program so your employees can be proficient at getting things done? 

3. Teach supervisors to supervise.

Banking is a hot-bed for the Peter Principle, advancing good performing employees into positions where they are not equipped to succeed. Does a great wire clerk make for a top notch Deposit Operations supervisor? Supervision and leadership skills to maximize employee performance and job satisfaction are learned skills. So teach them how to coach, reward, discipline, evaluate, and teach. Poor management and supervision is the greatest hurdle to building a learning organization.

4. Allow mistakes.

The amount of effort I have witnessed to avoid audit findings, regulator scrutiny, or supervisor retribution is monumental. Not that I mind this because bankers hire my firm to look at the resulting onerous processes to ask "why are you doing that?".  This no mistakes culture kills experimentation that can lead to significant improvements in how we get things done. An organization that treats mistakes as a lesson learned rather than an opportunity to write someone up is well on its way to becoming a learning organization.

5. Pass on the knowledge.

What good is the wisdom garnered from years of experience if it remains trapped within the mind of the experienced? Create a process to pass on knowledge. For example, perhaps the wire transfer clerk questions a cumbersome process to identity check a customer. The learning organization supervisor encourages employees to identify and solve for cumbersome processes, so the clerk interfaces with the wire transfer software firm to discuss alternatives. She makes a recommendation that looks favorable to the supervisor and compliance. Boom! The bank implements it, and the clerk drafts a "Knowledge Bomb" memo to her co-workers that changed the process for the better. The supervisor publicly acknowledges the accomplishment, and notifies the bank CEO about the clerk's initiative. The CEO publicly acknowledges the clerk in the company newsletter. Per the "allow mistakes" above, if regulators review the process next exam cycle and don't like it, make a modification that works for them and is efficient. But don't use the criticism as an opportunity to embarrass the clerk that designed the process. It would be a lesson learned.

What other ideas do you have for creating a learning organization?

~ Jeff

Further reading:

Harvard Business Review: Building a Learning Organization (1993) Create a Culture of Learning in 6 Steps

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