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Gleb Tsipursky

Management

The Return-to-Work Ultimatum Shaking Wall Street

Tension between desire for flexibility and perceived need to be visible for career advancement

Published: Tuesday, November 14, 2023 - 12:03

In an era when flexibility and autonomy are requirements, financial services leaders are ready to break the chains of traditional office norms. The results of a recent Deloitte and Workplace Intelligence survey make it clear: The future of the financial services sector is hanging in the balance, and leaders are prepared to walk out the door rather than surrender their hybrid work privileges.

The concept of work has undergone a radical transformation during the last few years. Gone are the days when the office was the only place for serious business. Flexibility and remote work have moved from being perks to being prerequisites for leaders in the financial services sector. But this shift isn’t just about convenience. It’s about fostering engagement, bolstering retention, and driving key outcomes, as the report reveals.

The high stakes of hybrid work

To truly understand the stakes of the hybrid work debate in the financial services sector, we need to understand the significance of the 66% of leaders prepared to leave if they’re required to return to the office full-time. This isn’t just a two-thirds majority; it’s a resounding declaration of the value these leaders place on flexibility.

These leaders aren’t your average employees. They’re the innovators and strategists who guide the direction of their firms, the ones who make critical decisions that shape the future of the financial industry. They hold positions of influence and power, and their actions can create ripple effects throughout their organizations.

Imagine the scenario where these leaders decide to walk out the door. The loss of their combined expertise, insights, and leadership would be a significant setback for any firm. It’s like removing the rudder from a ship sailing in turbulent waters. The organizations they leave behind may struggle to navigate the complex currents of the financial sector without their seasoned hands at the helm.

It’s not just the immediate fallout that’s concerning. Consider the long-term implications. The sudden departure of experienced leaders could cause a leadership vacuum, hampering growth and innovation. It could take years to rebuild the leadership pipeline, and during this time, firms may miss out on opportunities and lose their competitive edge.

Moreover, the departure of such a significant number of leaders could damage a firm’s reputation. It could raise questions about the firm’s culture and priorities, making it more challenging to attract top talent in the future.

The high stakes of the hybrid work debate, therefore, can’t be overestimated. It’s not just about accommodating individual preferences. It’s about the potential to disrupt the very fabric of financial institutions, altering their trajectories and potentially shaking the foundations of the financial services sector.

As such, every decision about workplace arrangements should be made with these stakes in mind. The future of financial services institutions depends on it.

A changing workplace paradigm

The idea of a fixed, traditional workplace is becoming as antiquated as a rotary-dial telephone in the era of smartphones. As the Deloitte and Workplace Intelligence survey indicates, the trend is moving decisively toward flexible work arrangements. But what does this transformation entail, and why is it so important?

A paradigm shift is occurring in our understanding of work and where it happens. The office, once the undisputed center of professional life, is losing its monopoly. We are witnessing the rise of a new model: the hybrid workplace, where work is an activity rather than a location. This model caters to the needs of employees for flexibility and autonomy while also meeting the business needs of organizations.

This shift is more than just a logistical change. It’s a cultural transformation that reflects the evolving values and priorities of today’s workforce. Financial services leaders are rejecting rigidly prescribed workplace models that don’t offer them the flexibility they desire. For instance, some organizations now require their workforce to be in the office three to four days a week. However, the survey reveals that only 18% of respondents consider this their ideal arrangement, suggesting a disconnect between institutional mandates and employee preferences.


According to Deloitte’s latest survey “Among respondents who still work remotely at least part-time, 66% say they will likely leave their current role if mandated to return to the office five days a week.”

Moreover, leaders are voicing their concerns about the effect of workplace arrangements on their careers. While remote work is associated with improved well-being and engagement, 62% of leaders in hybrid work arrangements believe that working remotely more often could harm their career progression. This suggests a tension between the desire for flexibility and the perceived need to be visible in the office for career advancement.

The changing workplace paradigm thus presents both opportunities and challenges. On one hand, it opens the door to new ways of working that can boost employee satisfaction, productivity, and work-life balance. On the other hand, it raises difficult questions about how to ensure fairness and career progression in a hybrid work environment.

The financial services sector must navigate this changing landscape carefully. Striking the right balance between flexibility and the perceived need for in-office presence is crucial. Institutions that manage to do this effectively can reap the benefits of the hybrid work model, while those that fail to adapt risk alienating their leaders and jeopardizing their future success.

The threat to female leadership

The potential exodus of financial service leaders due to rigid return-to-office mandates is alarming, but there’s another dimension to this issue that warrants urgent attention: the threat to female leadership.

The report shows that for leaders with caregiving responsibilities, the clock is ticking even faster. They are 1.3 times more likely to exit if their remote work options are rescinded. And unfortunately, women still are much more likely to be caregivers.

More generally, almost half (45%) of the women respondents in senior leadership roles are considering leaving their current employer within the next year. This statistic is a distress signal that can’t be ignored. Not only does it underscore the possible depletion of leadership in the sector, but it also highlights a potential setback for gender diversity at the top echelons of financial institutions.

The strict “return-to-office” mandates some financial services institutions are considering could be like setting a time bomb for their leadership pipeline. Consider the potential impact on the sector. Women leaders bring unique perspectives and approaches that can drive innovation, improve decision-making, and contribute to business performance. Their departure would deprive the sector of these valuable insights and could affect the competitive edge of financial institutions.

Moreover, the loss of female leaders could have a domino effect, affecting future generations of women in finance. Female leaders often serve as role models and mentors for younger women in the industry, encouraging them to aspire to leadership roles. If these role models exit, it may deter other women from pursuing leadership positions, thereby diminishing the pipeline of future female leaders.

The potential loss of female leaders also presents a reputational risk. In a world that is increasingly focused on diversity and inclusion, the mass exodus of women from senior roles could harm an institution’s image, affecting its ability to attract talent and potentially affecting relationships with clients and investors who value diversity.

Addressing this issue requires financial institutions to revisit their policies and create a work environment that meets the needs of their female leaders. This might include providing greater flexibility, supporting work-life balance, and ensuring that remote or hybrid working doesn’t affect career progression. It’s not just about retaining talent; it’s about creating an inclusive culture where diverse leadership can thrive.

The threat to female leadership is a serious concern that adds another layer of complexity to the hybrid work debate. How financial institutions respond to this issue will be a true test of their commitment to diversity and could significantly influence their future trajectory.

What’s next for financial services institutions?

It’s time for financial services institutions to reconsider their return-to-office strategies. Stubborn resistance to flexibility could lead to a leadership exodus. The solution? A gradual transition with flexible work arrangements and an enhanced in-office experience.

The key lies in maintaining an equitable work environment, whether employees are in the office or working remotely. This approach could not only retain top talent but also attract a more dynamic and engaged workforce.

The report serves as a clarion call for financial services institutions. The future of work is here, and it’s flexible. Institutions that listen and adapt will likely thrive in this new era, while those that resist may find themselves struggling to keep their leadership pipelines intact. The choice is clear: Adapt or risk losing your top talent.

That’s what I tell the five to 10 financial service leaders with whom I speak every week about figuring out their hybrid work models. Even though the financial sector is a more conservative sector than many others, if it wants to avoid a leadership talent drain—especially of female leaders—it needs to adapt to the flexible future of work.

Conclusion

The financial services sector is at a crossroads. The path institutions choose will likely determine their future success. As they navigate this new landscape, the message from their leaders is loud and clear: Flexibility isn’t just a desire; it’s a demand. The institutions that heed this call are likely to retain their leadership, foster engagement, and secure their future in the ever-evolving world of financial services.

Discuss

About The Author

Gleb Tsipursky’s picture

Gleb Tsipursky

Dr. Gleb Tsipursky helps quality professionals make the wisest decisions on the future of work as the CEO of the boutique future-of-work consultancy Disaster Avoidance Experts. A proud Ukrainian American, he is the best-selling author of seven books, including Never Go With Your Gut: How Pioneering Leaders Make the Best Decisions and Avoid Business Disasters and Leading Hybrid and Remote Teams: A Manual on Benchmarking to Best Practices for Competitive Advantage. His cutting-edge thought leadership has been featured in more than 650 articles in prominent publications such as Harvard Business Review, Fortune, and USA Today. His expertise comes from more than 20 years of consulting for Fortune 500 companies from Aflac to Xerox and more than 15 years in academia as a cognitive scientist at the University of North Carolina-Chapel Hill and Ohio State. Contact him at Gleb[at]DisasterAvoidanceExperts[dot]com, Twitter@gleb_tsipursky, Instagram@dr_gleb_tsipurskyLinkedIn, and register for his Wise Decision Maker Course

Comments

Return-to-Work Ultimatum Shaking Wall Street

The article is well written, but only tells a story from one persceptive, that of the worker. Believe that a similar poll from the industry itself should have been done or plan to be done (and so stated in the article). This would allow for a follow-on article that would state where the industry itself sees itself on this issue and what percentage of the industry has/will require a return to work full time.

Also the article, did not address two important topics for consideration.

1. Training

2. On the spot interaction between leaders and others that take place in real time in the workplace.

Not all learning is done in a formal training atmosphere, especially those soft skills required of leaders, but through interaction and observation.