Yahoo Finance Bridging hiring gaps in finance with technology
Here's how technology can help simplify, shorten and improve the efficiency of your hiring process.
The “Great Resignation”—a global trend of mass resignations triggered by the COVID-19 pandemic—has landed in Southeast Asia (SEA), and it’s hitting industries hard. Despite expansions in hiring and the number of available roles, we’re seeing that over two in three companies across various industries in SEA are experiencing rises in staff turnover. This is a contradiction that companies must resolve.
It is well-documented that nearly all industries globally face a talent shortage, but the problem is particularly acute in the financial services sector. A combination of burdensome regulatory requirements, tedious and resource-intensive hiring processes, and immigration restrictions have limited firms’ ability to access the skilled talent they require.
Apart from a lack of mid-career professionals, firms are also struggling to hire for entry-level roles in areas like sales and customer relations. Unlike other industries like food or retail, even entry-level roles in finance require a certain level of background knowledge and minimum qualifications.
To some extent, technical knowledge can be earned. The real challenge is finding candidates with a good mix of technical and soft skills, who are willing to work in these roles in financial services.
Struggles in the hiring process
Roles in sales and relationship management are often considered less desirable. They involve a lot of repetitive work and are perceived as being “easier” than those of their technical counterparts as they seemingly require less skill.
However, the reality is more nuanced. These roles are not less important. In fact, they are actually more important as they represent the company’s public face and because they bring in the business. Furthermore, despite high levels of automation in many aspects of work, the roles of sales agents and customer relations managers have not seen as much change because they rely on the human, personal touch. They are essential to the success of companies.
Around 50% of employees surveyed in Singapore indicate plans to leave their current jobs within the next year because of dissatisfaction with pay, benefits, and opportunities for career advancement. Churn rates among sales and customer relations agents are likely higher – they could be as high as 20% to 30%, while it’s closer to 10% for technical roles.
Narrow margins faced by firms across the industry mean that most cannot offer substantial differences in salary – and as such, financial advisors feel there is a low cost to shifting companies. After all, fierce competition for talent among financial firms means that most can easily find similar work elsewhere or even start their own businesses.
Recruiters are faced with a double bind: these roles not only hard to hire, but also have to be filled in bulk. Sales and customer relations teams are often the biggest teams in any firm, and each company has to retain an ideal customer-to-employee ratio in order to maintain a particular growth rate.
In insurance, for example, companies often have between 5,000 and 10,000 financial advisors managing day-to-day workloads in these roles. Since companies are contending with high turnover rates, they need to hire 2-3 times as many people to make up for the shortfall in a year.
These companies’ recruiters are faced with the herculean task of conducting interviews, managing documentation and navigating regulator-required approval processes – all at scale. This is a particularly time-consuming and inefficient process that drains companies’ resources.
Technology as a solution
This is a big challenge with no easy solution, but we see a major opportunity for digitalisation to ease the way forward for firms. Luckily, the financial industry has been quick to embrace the potential of technology to streamline their processes and systems in other operational areas – there is little reason for their recruitment processes to be excluded from this transformational process.
One way in which technology can solve some of the financial firms’ recruitment woes is by centralising candidate information to make it easier for teams to manage the entire application journey. Through a candidate-centric database, recruiters may be able to access historical information about interviewees and ensure they can limit the risks of hiring unsuitable candidates.
Technology can also optimise information processing and offer a data-driven approach to hiring by combining the database with a set of predetermined criteria.
Another aspect in which technology could have a major impact on financial firms is by reducing the costs of the rehiring process, which could come up to more than US$4,000 per person. That number is undoubtedly higher for many financial services firms that have to rehire in large volumes within short time frames to keep up with their turnover rate.
Companies can reduce these costs through technology. From beginning to end, interviews can cost recruiters entire days’ worth of work – between scheduling meetings, wading through documentation, spending time with candidates, and following up on applications. In some extreme cases—as we’ve seen in our parent company, Ping An Insurance Group—you could have hundreds of people responsible for just interviewing people.
By automating the interview process, firms could shift the burden from internal staff to a digital platform and create more space for recruiters to focus on more value-added work.
For example, rather than being interviewed by a human, candidates could be interviewed via video, and filtered with a pre-determined set of questions. Our “Know Your Agent” offering, for example, adds a layer of verification with facial recognition technology to match interviewees with their provided identification documents.
Recruiters could avoid the “moral hazard” of the interview process and save time by filtering out as many unsuitable candidates as possible within the first round. Subsequently, the rest of the company could see major improvements in its efficiencies, potentially reducing the recruitment timeline by more than half.
All in all, the hiring process can be simplified, shortened and made more efficient using technology. As a result, it will be easier to bridge the gaps between different stakeholders and steps for a seamless process. The future of recruitment is going to look a lot different.
Elton Qiu Yongqing is the head of Insurtech at OneConnect Financial Technology
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