eugene burke keynote london
TRANSCRIPT
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From the data to action and back againCombining analytics and behaviour change in the banking industry
Eugene Burke, Chief Science & Analytics Officer
March 2013
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The context is banking
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The topic is risk
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“Of all the management tasks that were bungled in the period leading up to the global recession, none was bungled more egregiously than the management of risk.”
Spotlight on risk Harvard Business Review
October, 2009
Source: Lloyds Risk Index 2011
How well are organisations prepared for risk?
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You can respond to risk structurally
You can tighten up your processes
Ultimately it is going to comedown to what people do
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On their own time, people do some strange things
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“There is the risk you cannot afford to
take, there is the risk you cannot afford
not to take.” Drucker
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There’s a risk in doing nothing ...
“I am so busy doing nothing... that the idea of doing anything - which as you
know, always leads to something - cuts into the nothing and then forces me to
have to drop everything.” Jerry Seinfeld
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Appetite for Risk Resilience to Risk
We need a balanced view of risk
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Appetite for Risk Resilience to Risk
We need a balanced view of risk
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Bench strength for risk stronger in sector
Bench strength for risk average in sector
Bench strength for risk weaker in sector
That model and bank share performance
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Those banks, their people and risk
Appetite For Risk Resilience to Risk0
50
100
150
200
250
Sector Bank A Bank B Bank C
SHL Global
1.3 millionassessments
across 79 countries
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Those 3 banks and their share price over 5 years
2008 2009 2010 2011 Sep 20120
10
20
30
40
50
60
70
80
90
100
110
120
Bank A Bank B Bank C
91
74
9
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© SHL, 2012
What people do appears to have an impact
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So, let’s get to individualsand their behaviour
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Likelihoods
Consequences
Biases
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DecisionQualityProfit Regulation
Reputation
Stakeholders
Consciousnessof biases
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How do the talents of our people position us for risk?
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Talent management ought to have a role inrisk management
What is the profile that our EVP attracts to our organisation?
Are we clear on the behaviours that enable us to be effective in engaging with risk?Are those clearly captured by our competency models?
Are they clear to our people?
What talents are we recruiting into our organisation?
What talents are we electing through our succession processes?
How are these behaviours underpinning our L&D programmes?
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Whatever the context, the impact of behaviours has a wide reach
Legal – lower compliance with regulations & procedures
Commercial – poorly designed & executed goods and services
Operational – increased errors, accidents & delays
Reputational – reduced confidencein products and services
Customer – increased disaffection & dissatisfaction
Misalignment of goals
Lack of ownership over decisions
Confusion over who owns decisions
Direction to follow unclear
Lack of accountability
Denial of responsibility
Employer brand – lower credibility & attractiveness
Talent – dilution of bench strength
Loss of pride in employer
Employee disaffection
Absenteeism
Employee churn
