Sociologist and bank staffer Franca Burkhardt has penned a reference book on the mood within the banking industry. She draws starting conclusions about the corporate culture in finance.
The impressive dissertation* by Franca Burkhardt, made available to finews.asia, looks into how and why the culture of Swiss banking has changed over time. It raises questions over the security and stability inside Swiss finance firms.
Characteristics such as trust, community and corporate loyalty dominated among the workforce for decades, but have been replaced by feelings of alienation, sparked by an increasingly short-term performance mentality dictated from the top.
Completely Swamped
«After causing a collective destabilization by tearing teams and areas apart due to cost-cutting and efficiency measures, we are then surprised that people pursue a clinical, individualistic business relationship, and have trouble seeing past the end of their nose without an incentive to do so,» says Burkhardt, who works as an executive at Credit Suisse.
The trend can be summarized as «overburdening.» If this is commonplace in in today's globalized financial marketplace, warning signs show that leadership as well as the rank and file in Swiss banking are increasingly disoriented – making a way out of the burgeoning crisis even more difficult.
Rising Risks
This is especially true of Swiss banking, which is in the midst of a painful paradigm shift. The end of banking secrecy has ruled business models at many banks obsolete. The question of the most ideal corporate culture becomes even more important in this context, not least due to increasing business risks.
The 33-year-old Burkhardt, who previously worked Julius Baer and UBS, delivers several new problem-solving approaches in her dissertation. finews.com spoke to her about her work.
Franca Burkhardt, you spent five years on this dissertation. What was your most surprising finding?
Surprising isn't quite the right word. It was more of a feeling of amazement, then disenchantment. Amazement because my dissertation allowed me, through bank employees, to take a trip back to a time that given my age I wouldn't otherwise have had access to. That showed me that employees used to have a strong identification, a bond, with their respective company.
The disenchantment came after I realized that leaders in the banking industry have for years neglected to think about corporate culture, and now face a massive challenge.
Many of the bank employees you spoke to seemed to be completely overwhelmed.
Overwhelmed is a good description – and also alienated. Swiss banking lost parts of its identity as international influence grew among stockholders and at executive level. Here, it's less the changes that are calamitous than the way organizations dealt with them: deeply-rooted values of employees were subordinated in a way that made it increasingly difficult to identify with «their bank».
«It gave me pause to see long-time executives who were at a loss»
Big Swiss banks in particular risk becoming foreign bodies culturally as they fight to compete internationally. They are walking a tightrope between the expectations of global demands and the stabilization of a seriously stricken internal body, which brings me back to the description «overwhelmed».
You interviewed dozens of bank employees. What shocked you the most?
It gave me pause to see long-time executives who were at a loss. Statements from leaders saying that it had become impossible to stand up for their teams, that experts on a subject had been sidelined in favor of short-term solutions and took otherwise avoidable technical and organizational risks. In fact, many employees would be absolutely willing to be part of a solution. But they feel degraded to merely a number, without an opportunity to enact any change.
Swiss corporate culture – possibly Swiss culture overall too – is so closely linked with the idea that «we'll take care of this together.» It's incomprehensible to me that we're not calling on this collective strength.
Could it have something to do with the lack of sympathy for banking in the wider public?
Exactly. Bank staff bear the brunt of popular and political anger. We should keep in mind that the majority of bank employees have nothing to do with the greedy bankers of ill repute – though those do exist and certainly have a lot of influence.
«There was a time that most bank employees believed in their captains»
Society needs to support this majority (of bank employees), but since they are not recognizable from outside, they get thrown into the same pot at the whole sector – with disastrous consequences.
You describe the early boss-led culture of banks very well. Were things really better then?
Put it this way: there was a time when most employees at Swiss banks believed in their «captains». People were proud to sail under that particular flag and they were optimistic of reaching their destination. Today, that attitude differs widely from bank to bank.
Certain banks, including big institutes, have created a common vision of the future in new ways. Other «captains» seem to convey to their staff that they are on a sinking «Titanic».
Anything we can learn from the past in order to improve the current climate?
You can't create the future with the past. Our society is experiencing an epic shift and we are well-advised to face the changes, not to try and stop them. These changes don't affect every aspect of our lives and work.
They don't?
For example, family and the emotional and social importance of the familial unit is still key. It's similar in a professional setting. We live in a fast-moving world with more changes and a sort of permanent overburdening which everyone has to figure out for themselves. But solidarity and identification remain important.
What conclusion do you draw from that?
The past should remind us how an organization's «us» feels like. But it's the current leadership and employees' job to find out how to pin down the «us» character in the future.
You talk about an «organizational ethnography». What problem-solving approaches does this offer?
It was important for me to show to that it is pointless to keep bashing banks or their leadership if we aren't willing to conduct a fundamental debate, especially on a political level, that is crucial for our financial center and its future.
What do you mean exactly?
The economic success of Swiss banking goes hand in hand with a cultural change that begs the question of the domestic roots of these banks. What do we expect, societally and politically, of a Swiss bank?
«Where are we forced to make compromises?»
Besides business development, top management at banks have to think about their organizations. Does their behavior and decision-making match up with the values they proclaim? Are they nimble enough to strike a balance between short-term success and long-term organizational stability? Where are they forced to make compromises? And how do we communicate these and maintain our employees' belief in our common goal?
What has to change for Swiss banking to survive in the long term?
I believe that we need bosses who are capable of walking this very tricky tightrope between international business success and inner stability and sustainability.
«Inhuman is a harsh word, but cold describes it quite well»
Leaders nevertheless need to outline a vision of the future and manage parasitic side effects from the past at the same time. Swiss banks will only have the necessary flexibility and adaptability to prosper internationally if they can unite their organization under a common denominator.
Not to put too fine a point on it, but that's very idealistic.
What's wrong with ideals given the single-minded orientation on profits? It's legitimate to question Swiss banks' necessity to be a top player in investment banking. A tiny America in the middle of Europe? I'm more in favor of sticking to what we know best.
You describe the banking sector as sometimes cold and inhuman. What motivates you to work in this industry?
Inhuman is a harsh word, but cold is accurate. My answer is: the people. I've spent so much time with so many people from different regions and areas – believe me, they are textbook examples of great people, employees and leaders. The majority of people I met are modest, cheerful, proper men and women who have nothing to do with the cantankerous «banker» image.
*«Ehrliche Bindungen und andere Geschäfte – Die Sicherheit in Schweizer Banken» («Honest Bonds and Other Dealings – Security in Swiss Banks»), dissertation at University of St. Gallen
Franca Burkhardt studied sociology and psychology at the University of Fribourg as well as political studies at the University of Geneva, where she absolved her Master's degree. With her dissertation on Swiss banking's corporate culture, she successfully concludes the University of St. Gallen's DOK PhD program.
Burkhardt started working in the banking industry in 2010 after various other professional activities, first for Julius Baer and later for UBS in business continuity management. She moved to Credit Suisse's in-house consulting group in 2015, where she has worked in organizational development and business risks in the chief operating officer's area since this year.
