Banks are going through enormous changes in terms of the skills and talent they need at the executive level. Arguably, banks nowadays need more expertise in regulatory compliance, risk management, information technology (IT) security and social media than in the past. Peter Crist, chairman of Chicago-based executive recruitment firm Crist/Kolder Associates, and chairman of $17-billion asset Wintrust Financial Corp., foresees a need for someone at the executive level “distinctly different [from] the chief marketing officer’s historical role” who understands social media and digital products. Rising concerns surrounding cyber security risk will also see the role of the IT executive gain prominence, a role that promises to be “tougher, more complicated, more sophisticated” over the next decade, says Crist.
Banks are already familiar with shifting needs in human capital, lately driven by regulatory concerns on compliance and risk. As the financial crisis hit, many banks did not have in-house talent qualified for the chief risk officer position, and Crist noted a spike in searches to fill the role. As more of the Dodd-Frank Act is finalized, banks “have to respond to that with talent,” he says.
Where can banks find these specialized executives? Crist says that many of the biggest banks are recruiting from outside the banking world.
Citigroup’s head of human resources, Paul McKinnon, came to the financial services giant in 2008 from Dell. State Street Corporation’s Chief Risk Officer Andrew Kuritzkes came to the banking world from management consulting firm Oliver Wyman, where he was a partner. Teresa Tanner worked in human resources at fast food chain McDonald’s for a decade before joining Fifth Third Bancorp as chief human resources officer in 2003. Anil Cheriyan joined Atlanta-based SunTrust Banks as chief information officer in 2012 from IBM Global Business Services, where he was a senior partner serving clients in the financial industry. Crist says that diverse experiences aid any company, but can be of particular benefit within the banking industry, which, he says, suffers from a lack of new thinking and innovation. “The best organizations show a proclivity to attract and retain people with diverse experiences who can think differently,” he says. Institutions “that don't think about introducing new [and] different DNA into their culture will go the way of all extinct species.”
In addition to looking from without, banks can still benefit from finding talent the old- fashioned way: Grooming from within, and taking advantage of the talent pool generated through industry consolidation. Crist wonders how industry consolidation will impact hiring for the surviving banks. “Will [bank] consolidation mean that there will be a surplus of talent floating around?” he asks. He also adds that some skills might prove unnecessary as banks provide more and more services online. “I don’t think that I would want to be a 55-year-old mid-market lending officer ten years from now,” he says. “I have a feeling that world is going to be changed dramatically.”
Bank boards need to look ahead. “How will the banking landscape look ten years from now?” says Crist, and in turn, where will future bank leaders come from? He stresses that bank boards and management should have a “top-down attitude” when it comes to human capital strategy, adding that the best companies spend considerable time on talent needs. He cites JPMorgan Chase & Co. (JPM) as a good example. “Look [at] how many JPM alums are running companies,” he says. “Jamie [Dimon, CEO of JPM] does a marvelous job [of] focusing on people.”