It’s pretty scary out there in the world of finance right now. Apocalyptic predictions of further meltdowns are rife and, to be honest, even if we ignore the scariest over-the-top forecasts we know that we are in for a tough ride.

I was getting carried away 2 weeks ago commenting on the events in the banking world as they were unfolding, but taking several days off temporarily cured me of this obsessive watching and recording of the crisis. I might come back to that in due course, but meantime I wanted to refocus instead on my own perspective of events, which really is the purpose of this blog – in this case to talk about bad staff management techniques I have seen in the banking industry.

I spent 10 years working in banking in various support roles, most recently in project management and IT. It was great around 2000 – money was abundant and life was fairly easy. Maybe not 9 to 5, but looking back it feels like we got paid quite well for doing an average job and not straining ourselves beyond sensible limits. To be honest there seemed to be a fair number of people around who were getting away with not doing anything much and still got paid. What we did was a skilled job, of course, requiring knowledge of finance, accountancy, or IT, and there was of course a degree of stress attached to delivering things correctly and on time, but generally it was a time of plenty – of money, bonuses, opportunity, and jobs all easy to come by. But then it got a great deal harder.

When the dotcom bubble burst, things got challenging, money got much tighter, and expectations on employees increased steadily and dramatically. My last firm, a big american bank, in line with the rest of banks, got tougher and worked its staff into the ground. Senior management were increasingly concerned about costs and margins and put huge pressure on people to deliver results. It was at times shocking to watch how they used every trick in the book, mainly of the “stick” not “carrot” flavour, to get every last drop of effort out of us. It was a tough, testosterone-driven, aggressive environment – and were were not even on the trading floor so weren’t paid large bonuses for the trouble.

The management employed curious staff motivation techniques. In a bout of pure inspiration, senior guys fanned the fires of staff competitiveness, for instance around the sensitive issues of promotions, then “raised the bar” at the last second so many would fail to qualify for it – forcing most to work even harder next year. In line with many other american companies, we had in place a staff performance evaluation system which was used in anger to get people to jump ship if they did not quite fit in. It was a nasty process and I might write about that sometime. Failure to deliver was often made public, e.g. through email communications to other managers, creating an all-pervasive culture of fear. Needless to say this general aggressive macho stance made many people ill with stress. At one point we had 10% of staff on long term sick leave. And did HR do anything about it? Did they hell. Anyone who cared about doing their job well found it hard to bear this sustained pressure. We’d be in a daily daze of stress, with 20 minutes for lunch at our desks and working up to 10 hours a day on occasion, being on call evenings and weekends. I liked my job a lot – it was varied, challenging and very satisfying when complex IT projects got delivered – but this was getting way, way too hard.

In June this year, I left the firm to take a break and look at other opportunities outside large corporates. Given the events of September 08, I feel this was probably the right move. Redundancies are taking their huge toll throughout the industry, including my old employer, and I know that whoever is left behind their desks will be working even harder, if this is humanly possible. I feel for these guys – there are few jobs around at the moment to escape to.

Now as an outside observer I can see how flawed and short-sighted the banking staff management system has been in the last 10 years: a feast in times of plenty, and famine when the chickens come to roost. The hire and fire syndrome worked right through the cycle, and we are coming into the “fire” phase of it. It’s a rhetorical question which I wrote about before – “will banks ever learn…?”

Have you got experience of the banking industry? Maybe you are working there currently or left it like myself? What do you think of banks’ attitude to staff management? Please leave your comments…

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