Other parts of this series:
In my previous post in this series, I discussed how advances in digital technology, along with other influences, are rapidly changing the business landscape of the financial services sector. I also reviewed how the Millennial demographic will soon become the mainstream demographic impacting the industry in many ways.
As the first generation to be called true “digital natives,” this population has grown up globally-connected, enabled by cable and internet. The use of mobile devices and the popularity of the “sharing” culture is imprinted on this group. It makes sense that Millennials would easily integrate into a digitally-advanced workplace.
How can Millennials uniquely meet the requirements facing the financial services industry?
The traditional place of work is changing. Millennials are driving more flexible work experiences. They expect to have control over where, how and when they work. They possess a willingness to learn and are very entrepreneurial in nature, which means their contributions could change internal organisational dynamics for the better, making for a more robust and adaptable workforce.
Driving an ethics-based culture. It’s not just about the money. Millennials want to ensure their talents and skills are recognised and effectively applied to their positions. They crave transparency and are independent thinkers. At the same time they like to collaborate as a team. When Millennials are given the opportunity to work in a transparent and socially-conscious culture, it can be a boon to financial services firms. In fact, 50% of soon-to-be and recent graduates in the United States want to work with companies that have a good public reputation. Additionally, 74% of recent graduates prefer to work for organisations that are known to have a positive and engaged workforce.
Making multi-generational relationships work. As Baby Boomer retirement looms, it is vital to ensure the right structure is in place to facilitate the transfer of knowledge and expertise from experienced employees to Millennials. This is one of the many signals that a major change is needed in the financial services industry in terms of managing a multi-generational workforce. Managers should support behaviours that accommodate cultural shifts in this dynamic work environment. For example, fostering cross-generational mentorship not only enables effective knowledge transfer, it also helps break down communication barriers. Additionally, offering flexible, part-time or consultancy roles to soon-to-retire employees enhances information sharing while meeting this demographics’ needs at this juncture in their career.
Challenges ahead; enticing Millennials to work in financial services
With just 7% of soon-to-be graduates interested in working in the financial services industry, firms such as banks and insurance companies must strive to understand this demographic and meet their new and distinctive needs. Millennials would rather work for a medium-sized or start-up business where they feel their contributions would be more valued, versus a large company.
While this generation has been known to job-hop, they are serious about working with companies, although their notion of long-term commitment might only mean a few years, not decades. Millennials are willing to work hard, and even relocate if the right opportunity presents itself. If this group is properly supported during their engagement, it’s likely they will stay longer or return after a leave. Compensation packages should be re-evaluated to ensure they fit Millennial needs, such as enabling home purchasing and other generation-specific investment goals.
Millennials as customers
Millennials are both the workforce of the future and the customers of the future. By engaging them as customers, firms have a better opportunity to engage them as employees. Unlike Baby Boomers, Millennials are more interested in sharing investment wealth, which could signal an increase in legacy investing. They’re also more willing to search for a variety of options, and prefer digital investing channels. Financial services firms must integrate powerful and robust technologies to meet this demand. While Millennials may be more conservative investors, it is vitally important to present them with an investment strategy suited to their changing needs over time.
In my next post, I’ll review how Millennials can help financial services firms be successful.
To learn more about Millennials and the financial services industry, read Human Capital Ultimate Guide to Millennials in Financial Services.