New Management Models: Levers to increase performance
Large financial institutions have started their journey to rethink and transform their organization, in order to bring more agility, promote creativity and ultimately increase their performance.
These new management models have many levers, and their benefits are maximized when implemented simultaneously:
- Review the hierarchical organization, by refocusing manager scope and objectives, diversify promotion models and bring more autonomy to teams. The objectives are to promote collaborative work with project driven approach (ex. Société Générale reorganization in 2017, Natixis in 2018)
- Enable flexibility at work, with variable working hours and the promotion of home office (Initiative promoting home office at BNP Paribas in 2016 for instance)
- Adopt new tools to ease collaborative work and flexibility (ongoing deployment at Natixis)
- Adapt workspaces to the new ways of working (ex: Société Générale “les Dunes” buildings, flex office initiatives at BNPP since 2016) to promote flexible and collaborative works .. and to reduce costs (for example: SG “les Dunes” project enable to reduce from 11000€ to 7000€ the yearly cost per m²)(1)
Besides the objectives to reduce costs and inefficiency with shorter decision making processes, digital collaborative tools and optimized workspaces, these initiatives share another common goal: enhance performance and growth perspective by bringing agility, innovation and creativity at each stage of the organization.
Another shift contributes to the same benefits: Promoting gender diversity within the organization
When Judith Hartman, CFO for Engie, was asked if being a female CFO matters, the answer was indisputable: “As a CFO, my objective is to create value. It is not male or female. (…) But for the corporate efficiency, what really matters is diversity (2)”
Gender diversity is one axis to foster performance:
- 2016 Credit Suisse Research institute report on Women in Senior Management confirms their first statements in 2014: companies were women are at least 15% of the senior management had more than 50% higher profitability than those with less than 10% of women in senior management.
- Same statement for McKinsey in their 2018 study Delivering through Diversity, confirming their 2015 analysis (3): companies in the top quartile for gender diversity on their executive teams are 21 % more likely to experience better profitability than companies in the fourth quartile.
If neither of these studies claims a causal link between gender diversity and performance, we can’t at least deny the correlation.
Similarly to new management models, diversity gender generates the same results: more diversity would bring larger pool of top talents resources, different point of view favoring creativity and innovation, and better ability to understand client needs with a larger representativeness of the market. For example, according to 2017 Financi’Elles survey results, the best advantage of gender diversity from a male point of view is to bring more creativity.
Gender diversity is also perceived as a positive impact on employee satisfaction (male or female), which is a first step to promote collaborative work and employees involvement.
Combining gender diversity promotion and management models transformation would maximize expected benefits: These initiatives are complementary and could be managed independently, but we believe that the launch of transformation programs to review management models is an opportunity to truly embrace gender diversity promotion, with a shared objective: improve the organization performance.
Key success factors: strong governance and long term commitment from the Executive Management
The implementation of these new management models require a profound shift of the organization mindset, especially at manager level, to be truly adopted and to bring expected benefits. This must be structured into transformation programs sponsored by the top management, with a strong commitment and close monitoring of the KPI and achievements at executive committee level.
Wait… Am I really talking about New Management Models?
(1) Le Comptoir de la nouvelle entreprise
(2) Les Echos, Sept 2017
(3) 2015 McKinsey study Why Diversity Matters