January 21, 2024

Culture Change at a Financial Institution

The GFC: the catalyst for change

The Global Financial Crisis (GFC) in 2008 sent shockwaves through the financial services sector, disrupting established practices and forcing our client, a large global financial institution, to adapt to unprecedented challenges.

Before the crisis, our client primarily generated revenue in three ways: advising clients on mergers and acquisitions, providing capital for growth and operations, and investing their own funds into profit-generating projects. However, the GFC prompted a shift in priorities as the institution had to protect its balance sheet and take a cautious approach to it’s investments.

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Slow and steady

By 2016, the organization was returning to rapid growth with market conditions becoming much more favorable. New opportunities arose, existing and new client activity increased and private and institutional investors were looking for opportunities to partner to deploy capital.

The end of the “rebuild” phase for our client was marked by a significant acquisition (a large investment bank) which dramatically expanded an existing market sector for them and nearly doubled their size.

A new horizon

Even with all this change, the true turning point came with a change in leadership with new leaders appointed to replace the recently retired head. They recognized the need to reposition the business, an evolution of its strategy and culture change to support more aggressive growth and expansion.

In creating their new strategy, they recognized that their culture would need to support more risk-taking, growth orientation and collaboration. However, there was a significant disconnect between this vision and the existing culture, which had emphasized prudence, stability and individualization.

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Working with Rutherford HR

The new leaders knew what they wanted and were confident in driving the organizational, commercial and risk changes. However, they were less certain as to how to change culture and how to do this whilst simultaneously running a multimillion, global business.

Recognizing the need for increased capability and capacity to guide their progress, , Rutherford HR was engaged to help plan, support, and implement the necessary culture transformation.

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1. Initial research to lay the foundations

At the time we were engaged, the leaders had been in the business for seven months. In addition to directly asking them about their desired culture, we analyzed their formal communications and presentations from their first six months in charge. This allowed us to gain insights into how the aspired culture was projected, what they were instinctively hoping to achieve and what this represented to the organization.

2. Culture surveys to gain insights

This was a good start but we needed more information and our clients wanted data, analytics and insights to measure and track cultural effectiveness, empowering them to make more informed decisions.

We designed and distributed a comprehensive culture and engagement survey, garnering responses from approximately 2,000 individuals. This survey aimed to unveil the current state of organizational culture.

Additionally, we conducted a smaller, targeted culture with the top 100 leaders. Unlike the previous survey, this was future-focused and designed to uncover the cultural aspirations (linked to strategy) of those responsible for driving the strategic and cultural change.

The outcomes of these surveys revealed critical gaps between the current and aspired cultures in three key areas:

Collaboration: It became evident that there was untapped potential in delivering various facets of the business to the same clients through cross-selling, enhanced account management, improved client relationships, and a sense of client ownership. Fostering trust and gaining a deeper understanding of colleagues' roles within the organization emerged as key steps to nurture a collaborative approach.
Innovation: The survey results highlighted the need for greater engagement in innovation and a willingness to invest in new ideas - linked to an overt change in risk appetite. The organization needed to step out of its comfort zone and embrace calculated risks to foster innovation goals.
Broader perspective: While the organization's structure focus had been focused on tightly defined geographic groupings, survey findings encouraged a broader perspective.

Furthermore, our surveys provided valuable demographic analytics, providing insights into which segments of the organization might pose the greatest resistance to change, where to initiate transformation efforts and which geographical areas would need the most attention and resources on the three areas of cultural misalignment identified.

3. Leadership conference to inspire ownership

A leadership conference (with the 100 most senior leaders) was conducted to inspire ownership of change, drive self-directed action and increase buy-in.

We started by presenting a summary of the survey results to educate leaders on the current culture. Then, we facilitated a brainstorming activity that encouraged leaders to think about solutions for moving the culture from its current state to the desired state. For example, they were given problem statements for the identified gaps (collaboration, innovation, and scope), such as, “How do we work across sector and geographical boundaries to deliver more value to our clients?”, and asked to come up with solutions.

4. Workshops to put plans in motion

Following the conference, pairs of highly experienced leaders volunteered to lead change efforts for each of the 3 areas of initial culture change focus. Their role was to spearhead transformative initiatives spanning the entire organization, harnessing ideas from the conference and driving cultural change initiatives.

To empower these leaders, we designed and facilitated three culture change workshops. These one-off sessions were delivered to a select group of key individuals, which included subject matter experts and the two primary leaders. The subject matter experts were company influencers who were highly regarded by their peers. They were strategically brought in, not only for their expertise, but for their ability to explain the changes and buy-in that their involvement would generate in others.

The workshops were focused on three critical change aspects — behaviors, systems, and symbols — and targeted the previously identified problem areas of collaboration, innovation, and scope.

Behaviors: The primary driver of change in workplace culture is a change in leader behavior. When leaders consistently adopt new behaviors, the organization naturally follows, often subconsciously. This sounds easy and enabling, yet we know that modifying behaviour can be challenging and demanding. Therefore, we combined this approach with the subsequent systems and processes workshop to align and adapt them for more effective results. Some of the behavioural changes we set out to implement included:

Redesigning and refining leadership training programs.
Re-evaluating our client’s hiring criteria to ensure a better cultural fit.

Systems: In this section, participants outlined the necessary changes to their systems and processes to support and encourage the desired behaviors (or the removal of barriers to their adoption). These included:

Adapting performance and reward criteria to recognize behaviors and activities that would incentive increased collaboration and a global outlook.
The establishment of systems for more efficient client and knowledge management.

Symbols: This section focused on defining the visible and overt indicators of cultural change. For instance,

Changing recognition award criteria and events to celebrate collaboration rather than individual victories.
Internally launching a new set of organizational “principles, defining expected behaviors

In each workshop, we supported the design and planning of such projects for implementation.

Subsequently, we assisted in executing these programs, bringing practical ideas to life. Many of these initiatives necessitated separate work streams, highlighting the need to address multiple facets of the organizational system to drive meaningful change.

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Tangible transformation

The culture change initiative created by Rutherford HR resulted in significant positive outcomes for our client, including:

Enhanced global connectivity and alignment.
A change in the number of multinational market opportunities.
Improved engagement with global clients and increased numbers of offerings being delivered to them.
Increased mobility of employees between geographies.
Changes to core development programs, such as leadership training.
New and enhanced performance management approaches.
More efficient communication pathways.
Modified assessment criteria for Internal identification of high potential and promotable talent.
New systems implementation to provide increased knowledge management and client understanding.

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Need a new culture for sustainable success?

This client story highlights the importance of culture change in achieving strategic goals. If you’re looking for a partner who can help you assess, define, and implement a new culture aligned with your growth objectives, we’re ready.