The Current State of Employee Engagement in the Banking Sector
As we well know, the banking, financial services, and insurance (BFSI) industry had a particularly volatile 2020. While eCommerce platforms boomed, traditional banking firms suffered as a result of global financial issues and the disruption of normal banking practices. However, we cannot forget how the BFSI industry contributes a significant percentage of the global GDP, and in turn employs several million people around the globe. Further, companies in the sector are in a pivotal role in regards to post-COVID bounceback, and hiring should resume (or never suffered at all!) now that the global economy begins to roar back into form. But the biggest issue? Our intensive, psychology driven research has shown that when it comes to the people who work in the sector, they seem far from engaged and happy as our 2020 state of engagement in the industry shows.
Global reports confirm a dismally low employee engagement of just 33%1 and an employee turnover rate of 24%2 — one the highest among all industry sectors. This is further exacerbated with the cost of replacing a skilled, educated employee ranging anywhere between 6-24 months’ of salary3, depending on the job role and seniority. Between onboarding costs, the time required to get up to speed, lost productive hours, and more losing employees through high attrition causes companies to bleed fund replacing employees. However, our conversations with over 80,000 employees at companies worldwide has given us the insights to write a deep dive you need to reach today: The BFSI Employee Engagement Index 2020.
Improving Employee Statistics with AI
However, our customers in the same space have seen very different results as a result of their usage of AI both during periods of in office work and work from home. We studied 18 enterprises and their employees in the BFSI sector that utilize Amber, an artificial intelligence chatbot and analytics tools to compare and analyze if HR tech like these are in fact making a difference in a variety of work environments.
We analyzed 185,000 chats from more than 80,000 employees with Amber, or AI-driven engagement chatbot to track whether or not it indeed helps HR teams meaningfully connect and engage a workforce without expending excessive time and effort, as HRBPs are known to spend over half of their time collecting feedback rather than planning decisive actions that impact key business levers. From these insights, we’ve gleaned actionable points that you can plug in today, both in BFSI companies and companies around the world who are looking to embrace best practices thinking and change the culture of their companies.
Here’s a deep dive into The BFSI Employee Engagement Index 2020, a detailed report of AI's impact on employee engagement.
Highlights from Our Report on Statistics Around Employee Engagement
- Using AI, response rate nearly doubles to 60% as opposed to the subpar 33% participation rate on an average annual surveys
- Manager availability and emotional support rate highly as a key engagement factors that positively impact employee experience and build trust in senior leadership
- The average HRBP to employee ratio reduces radically from 1:336 to 1:30, which in turn allows HRBPS to spend their time focusing on employee retention, onboarding efforts, and initiatives to boost company wide engagement
1. Getting Real Time Feedback you Need to Make an Impact and Increase Employee Tenure
Without actionable insights, any efforts to launch meaningful employee engagement campaigns are doomed to fail for a variety of reasons. First and foremost, not empirically evaluating employee pain points and instead relying on word of mouth without appropriate scale of feedback means real issues won’t rise to the surface. Particularly in a hierarchical environment where speaking directly to managers or low level HRBPs means that fears of ramifications of being the “squeaky wheel” are very real.
Further, without real time feedback there’s no empirical evidence that any efforts in place are actually working! You can take a shot in the dark as to the efficacy of your programs and initiatives, but without real time data you have no way of actually gauging employees’ response. In person, we can read body language. But remotely? Forget about it.
In BFSI, one of the last industries scheduled to return to office due to the feasibility of remote work, having a tool that allows you to promote productive initiatives and gauge their success is crucial. If you may not all be in the same space for months, and with eCommerce firms hiring at high rates, BFSI HR professionals run the risk of large backfill costs in the wake of the potential hiring frenzy.
2. Trust in Managers and Senior Leadership Increases Buy-in to Increase Average Job Tenure in 2020
One of the key factors our research has indicated is that low levels of trust in top leaders, and the managers that serve as gateways to leadership, can hurt employee engagement and performance. Building an ownership culture and mentality in workers across all levels of the organization in turn boosts productivity by providing a personal stake in the success of the company. Understanding larger business goals, as communicated and explained to them by their managers and senior leaders, keeps employees motivated and determined to do their best.
Also, as your manager is your primary touchpoint within an organization, a lack of empathy or leadership abilities directly impacts employee performance. Feeling that your boss doesn’t trust you quickly erodes employee willingness and initiative to solve problems creatively and entrepreneurially, handcuffing your workforce. And in a time of crisis like the pandemic having a manager who doesn’t sympathize with your personal issues can make employees feel like their company does care about them.
However, AI can solve these issues by giving employees voices and recognizing that their concerns will reach top leadership. As long as those leaders practice what they preach and seek to amend employee concerns in a top down style managerial issues can be righted and employees will feel confident that the company truly cares about their emotional wellbeing as well as work performance.
Alongside AI, proactive reach outs and engagements from top leadership empower employees and build trust. Knowing that your employer trusts you enough to loop you in on key business decisions, is willing to answer your questions, and, with Amber, has admin access to all levels of feedback you know that your company and its leaders’ are looking out for you.
3. Lowering HRBP to Employee Ratio to Hire and Retain More Effectively, as Well as Boosting Engagement
This topic plays hand in hand with our discussion of the importance of AI in data aggregation, with AI chatbots like Amber leading the pack. By giving your HRBPs the tool they need to succeed you’re putting them in a position where rather than backfilling due to unidentified unengaged employees you can direct their productivity in more beneficial directions that move key business efforts. Further, their engagement initiatives can be tracked and analyzed, helping you build the data set you need to make educated decisions about budget spend on engagement efforts. In the EX4.0 framework, treating employees like customers to boost eNPS and productivity is standard form, but without the right tools HR members are not in a position to advance organizations on the employee experience spectrum. Your HRBPs are overworked, and Amber is the way to fix that.
By identifying disengaged employees HRBPs are empowered and can take decisive actions to rectify problematic situations before they boil over. By continuing to empower HR practitioners we push them towards the central business committee at a lot of prestigious firms, and if an AI chatbot is the tool you need to help continue to get HR over the hump then it’s worth investing in. In BFSI, with a hiring frenzy potentially on the way, making sure you have data-driven initiatives in place to make your company a great place helps you mitigate the potential risk of atrophy we may see in the near future.
AI Making Employee-First Practices a Reality
All of these deep dives into causes of attrition, retention, AI tech, and engagement sound great on paper. But what have we seen in our research and succinctly compiled into this report for you?
While AI was always a trending topic with minimal buy-in, results from our conversations with 185,000 employees at BFSI firms has provided data that supports our hypothesis that AI can make a real impact in all aspects of HR practice. We’ve observed the HR teams we work with decentralizing decision-making, making leaders accountable to the employee while the latter becomes the center of experience delivery. Progressive companies are looking inwards and outwards to implement employee-friendly cultural and operational changes along with policies and mindful actions that show they care.
One of our customers also recorded the impact of using an AI tool like Amber in their HR function. The results?
- 87% response rate
- 78% of employees with turnover intent saved
- 18x returns on investment
How can you create an enhanced employee experience in your organization? Learn from the best.