The importance of inclusion and diversity in recruiting and retaining the skills and talent needed in the asset finance industry was a prominent issue raised in a number of sessions at the AFC June conference, with a group of young ambassadors discussing the components of diversity strategies that are crucial in attracting and retaining a pool of talented people.
Building and growing the right relationships between staff and clients and partners is of paramount importance to the auto, asset and equipment finance industry.
SGEF’s Florence Roussel-Pollet pointed to some historical long-term partnerships of over 20 years at SGEF, stressing the importance of building these relationships by shifting together as a company’s business model transforms. Developing strong and close relationships helps lenders and partners overcome adversity and address the current economic situation.
To meet these growing challenges and changes in our societies and economies, companies must create diverse teams, to reflect the wider diversity of business and society at large.
Within the UK market, the number of job vacancies currently exceeds the number of job seekers. According to McKinsey, 53% of employers are experiencing greater voluntary turnover than they have in previous years. And 64% expect this to get worse over the next six to 12 months.
Therefore, companies now more than ever are in a talent war to attract new talent to a company and retain new recruits and hires. Ylva Oertengren, Chief Operating Officer at Simply Asset Finance agrees: “there is a war for talent and it is really an employee’s market at the moment”.
Businesses need to consider corporate responsibility in the context of diversity as social exclusion and low economic activity rates can limit business markets and their growth. Corporate responsibility was previously centred on environmental issues, but an increasing number of employers now take a wider view, seeing the overall image of an organisation as important in attracting and retaining both customers and employees.
Oertengren highlights that many new young employees have a passion to work for a purposeful company in a purposeful industry: “unless you can explain why the company’s values are important, then you won’t get the best out of people”.
People want to work for employers with good employment practices and they also want to feel valued at work. It is important to create open and inclusive workplace cultures in which everyone feels valued, respects colleagues, and where their contribution is recognised.
As Nathan Mollett, Head of Asset Finance at United Trust Bank points out, “The next generation of talent put greater emphasis and importance on working for an organisation that has common values and common purpose.”
Matthias Grossman, CEO Commercial Finance at Siemens Financial Services believes that a company’s values are increasingly important to future employees.
Key areas of debate
Four young ambassadors from the asset finance industry – Alex McWilliams, Communications Manager at Simply; Lauren McQuilken, Business Development Manager at United Trust Bank; Jessica Hall, Business and Performance Manager at NatWest Group; and Ricky McNeil, Director of Operations at MAF Finance Group – discussed the topic in greater depth at the AFC June conference.
They considered the three key areas highlighted in McKinsey’s 2021 research entitled, ‘Great Attrition’ or ‘Great Attraction’? The choice is yours’:
- avoiding transactional relationship
- career development and progression
- providing a sense of community
According to McKinsey, if companies make a concerted effort to better understand why employees are leaving and take meaningful action to retain them, the Great Attrition could become the Great Attraction: “By seizing this unique moment, companies could gain an edge in the race to attract, develop, and retain the talent they need to create a thriving post-pandemic organisation.”
Avoiding transactional relationships
McWilliams believes that while work is always going to be transactional, a transactional relationship can only take an employer so far with their employees. People want to be valued and credited for their experience in ways other than remuneration.
However, over the last two and a half years, a lot of people have been affected by the Covid pandemic which created a slight separation between employees and employers, and relationships were no longer going to be enough. According to McWilliams, this can be resolved “through good culture, making sure that your employees feel like they’re in a sort of a safe space where they can communicate properly, making sure that there’s career development opportunities as personal and professional development opportunities.”
By keeping communication open, reducing separation and creating a good culture where people feel valued and able to talk freely about their aspirations, enabling employers to understand their employees, the relationship will start to feel less transactional resulting in increased productivity and employee engagement.
As stated in the 2021 McKinsey article, “employees want meaningful—though not necessarily in-person—interactions, not just transactions.”
In McNeil’s experience, salary and bonuses have only ever been a short-term retention plan. If a company is using financial incentives as a key retention strategy, then they are going to struggle to create any long-term relationship or loyalty with employees.
Reverse mentoring has been frequently highlighted as a tool to help companies understand the next generation’s culture and values, and to improve employer-employee relationships. This is a two-way benefit as the young ambassadors get a rewarding working environment within a purposeful company that helps them develop, while the senior management that the young talent is reverse mentoring gain huge benefit as well. As Roussel-Pollet highlighted, there are many initiatives going on inside organisations like SGEF that the young ambassadors and young talent have bought to management and that have since been implemented.
Career development and progression
McNeil believes that career development and progression is an extremely important part of retaining talent, and a key area of most employee’s strategies. When a company has the right culture in place, they are able to empower employees to take ownership of their own development by signposting people to routes of opportunity, highlighting success stories and resources.
Nathan Mollett agrees that “giving younger people within the organisation project management responsibility is also viewed as a promotion in terms of career progression and keeping them interested”.
Employees are increasingly focused on opportunities for development and progression in their role, as well as striving to find an employer who has similar ideals to them, with a sense of responsibility, culture and teamwork.
Having the right conversations with employees to understand their development ideas and where they want to go in their career is vital for employers, according to Hall, so that they can help and support their employees, and point them in the right direction.
As McWilliams concludes, “it’s about having an open dialogue and creating a space where employers listen to what it is that employees want.”
Sense of community
Most young people entering a new role in a new organisation want to enter an industry that has a sense of community within the company and within the industry as a whole. Hall believes the asset finance industry offers a lot of opportunities to do this.
McWilliams points to the innovative work carried out by the Leasing Foundation’s Next Generation Network in boosting community and encouraging businesses and lenders to push their employees to network and collaborate with their peers in an open and inclusive environment, giving them a significant advantage when it comes to seeking advice and guidance. She reports, “it is gaining traction and that community is getting bigger.”
Socialising with the competition was previously frowned upon, recalls Mollett, but things have changed and “the more you can do to empower colleagues within your organisation to build a network outside of your own, that actually plays into colleague retention, rather than increasing the risk of them leaving.”
As United Trust Bank’s McQuilken states, “retention is one thing, but attraction is another.” Attracting young people to the asset finance industry is something that must be addressed according to MAF Finance Group’s McNeil: “initiatives and schemes that can be implemented through the Leasing Foundation, for example, to help look at how we attract more talent, through graduate schemes, apprenticeship schemes, even looking at school leavers. The more that the Foundation can do to support this the better and that’s one of the ways we’ll tackle the attraction issue.”
Jeff Lezinski, SVP, Solution Architecture at Odessa discusses Odessa’s thoughts and initiatives on attraction and retention of new talent within the industry.
As Nathan Mollett, who is also Chair of the Leasing Foundation, notes turning attrition into attraction isn’t easy in any industry because it requires companies to really understand their employees.
Simply’s McWilliams believes that a good company culture is the key to successful employer-employee relationships.
Looking to the future
To create a healthy future for the asset finance industry, time and investment is needed to attract and retain a pool of talented people who can pass on their culture and values to companies and the industry as a whole in these changing times. Without the proper tools, such as career advancement and providing a sense of community, the industry will be unable to recruit a team of diverse individuals who can relate to an increasingly diverse client base.
Organisations such as the Leasing Foundation have launched a number of projects and initiatives to help the asset finance industry attract, develop and retain a new generation of employees, including the Next Generation Network, a network for the next generation of business financial professionals, the Diversity & Inclusion Initiative, and 30 Under 30, an annual list of individuals who are driving forward the asset finance world today.