Whether the Covid pandemic finally is on the way out or not, new working habits and preferences are likely to remain for the foreseeable future. That’s prompting some institutions to commit to hybrid employment models that combine remote work with occasional in-office hours.
“People want a work experience that reflects the changes that have come about in the workplace as a result of responding to the pandemic,” Tom Prohaska, CEO and President of Idaho Trust Bank, tells The Financial Brand. “I no longer see a world where all employees are required be in the office every single day.”
Not everyone in banking shares that view. Goldman Sachs CEO David Solomon notably has required all employees back into the Wall Street bank’s Manhattan offices five days a week. While strong-arm return-to-office policies may work for large institutions with the scale, power, and pay to keep employees, smaller banks and credit unions may have to be more flexible.
Number of white-collar employees who want to work from home at least two days a week:86%
Across all industries, workers who got a taste of remote work freedom during the pandemic aren’t willing to go back to the daily grind. A 2021 survey by Harvard Business Review found 81% of workers either don’t want to go back to the office or would prefer a hybrid work schedule. A more recent survey of 10,000 people by Advanced Workplace Associates (AWA) found only 3% of white-collar workers want to return to the office five days per week, while 86% said they want to work from home at least two days per week.
“Employers have to realize that the genie is out of the bottle,” Andrew Mawson, managing director of AWA, said in a statement in Fortune. “Workers have seen that flexibility can work, and bosses who are not sensitive to their employees’ needs will suffer accordingly.”
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How One Bank Built its Hybrid Model
While many smaller financial institutions have played their remote and hybrid work strategies by ear, Idaho Trust Bank took a more planned approach. The bank performed a careful analysis of every job for each of its 50 employees, identifying what needed to be done in the office, what could be done remotely, and what needed a mix of both, according to Prohaska.
“You can have all the Zoom calls in the world, but there’s no substitute for direct interpersonal relationships. We like employees to retain some face-to-face interaction.”
— Tom Prohaska, Idaho Trust Bank
It then came up with what it calls the “4Work” hybrid work model, which separates each position into one of four categories. This includes essential work from office, work from office with “home leave,” hybrid work from office, and flex from office.
Essential work-from-office roles include front-line tellers and the CEO; staff with roles in the second category spend most of their time in the office but have a certain number of days per quarter to work from home. “Work from office” employees work primarily in the office with one day of remote work per week, typically a set day. Finally, “flex work from office” employees work remotely but must come into the office one day per pay period.
“You can have all the Zoom calls in the world, but there’s no substitute for direct interpersonal relationships,” said Prohaska. “We like employees to retain some face-to-face interaction.”
Idaho Trust implemented the 4Work concept in November 2021 and has seen qualified success based on employee feedback. The plan not only offers employees more options but creates opportunities based on the role of the titles and functions of the jobs. “As we grow, there’s also the opportunity for them to advance, change their position or move into a different work category,” says Prohaska. “I think it gives people some sense of possibility.
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Are Hybrid Plans Needed to Attract Banking Talent?
While many banks haven’t explicitly defined “hybrid” work models, such arrangements are becoming more common. Banks and credit unions are taking a varied approach depending on the job, the size of the organization, and the scope of operations. 85% of attendees at the Consumer Bankers Association’s CBA Live 2022 event said within three years, most of their employees would be working in an office two to three days per week.
Large financial institutions have responded in different ways, with some embracing the idea while others don’t. In addition to Goldman Sachs, mentioned earlier, here are what two others are doing:
- After initially postponing return to the office due to the Omicron surge, Bank of America began bringing employees back to the office in late January 2022. While it didn’t specially address unvaccinated employees, BofA announced plans to have all vaccinated employees back in the office by March 1.
- American Express CEO Stephen Squeri said 40% of employees would continue working remotely while the remainder will be required to be in the office two days per week.
Prohaska believes the financial services industry has historically been very conservative in workplace innovation. When the industry was forced to go remote in the pandemic, many banks and credit unions discovered positive benefits in the change. “I see no reason why we shouldn’t continue to build on those innovations then adapt it to the realities of employee and business expectations,” Prohaska states.
The jury is still out as to whether a hybrid work plan will help attract talent. Even it if doesn't, a few institutions see other benefits from these plans.
Hybrid work options are also becoming extremely valuable in competing for talent. Yet it remains to be seen how going back to rigid 9 to 5, in-office requirements will affect recruitment and retention. A 2021 survey by technology performance company Riverbed | Aternity found 96% of financial services decision-makers believe hybrid work environments will help in recruiting top talent and in remaining competitive.
“Hybrid work is becoming a prerequisite for banks to attract new talent and retain a competitive advantage,” said Jonaki Egenolf, Chief Marketing Officer at Riverbed | Aternity in a statement. He emphasized that providing a seamless employee experience business and IT decisionmakers need to work together to ensure they have the right technology in place.”
Hybrid Work Adds Operational Flexibility
Hybrid work options can be especially beneficial in the face of continuing uncertainty. For example, just as many banks were moving back to the office in late-2021, the Omicron wave hit and led many to change plans. 44% of companies surveyed in mid-December had altered or pushed back their reopening plans due to the Omicron variant, according to Gartner. The firm noted the key for many employers is a flexible model that enables them to adjust plans as needed. Indeed, new Covid variants began cropping up not long after Omicron receded.
Banks and credit unions must ensure they have the technology and processes to make it work. Some institutions, including Idaho Trust Bank, already had the proper infrastructure to support long-term a long-term hybrid work model. Most didn’t. And according to the Riverbed | Aternity survey, many still face challenges, including: having the right technology and equipment for home setups (31%), poor home/remote network performance (29%), expanded security risks (27%), lack of visibility across the network (26%), and lacking the right technology and equipment in the traditional office (26%).