Transforming to Win

Businesses face challenges these days to drive growth in trying circumstances, to tune their operating model for a fast-changing competitive environment, and to motivate and inspire their workforce to shape and participate in transformational change. We all have much to learn from each other.

David Schwimmer and Tanuj Kapilashrami shared valuable insights into the way they are working to revitalise the venerable franchises of LSEG Group and Standard Chartered, respectively. We then had smaller breakout groups of peers. Here are some of our key takeaways:

• Keep your strategy fresh without constant change. Today’s world is too full of market volatility, technological disruption, and geopolitical tensions to put your strategy on autopilot, but at the same time, as both David and Tanuj put it, if you keep changing your strategy, you’re doing something wrong. Leaders need to set a high-level strategy that can endure while constantly monitoring to make sure it’s fit for a changing environment. David mentioned the importance of conducting scenario planning exercises to adapting as needed. Tanuj expressed the need for global companies to give local or regional teams the flexibility to implement group strategy quickly in a way best suited for their markets, while stressing ultimately there is only a single strategy.

• Change and adaptability need to be embedded in the corporate culture, and that starts at the top. David related how he led an initiative to define the core values of LSEG, and one of them – actually suggested by employees – was change. The company brought that to life in 2021 with the $27 billion acquisition of Refinitiv, which transformed LSEG from a trading venue to a global financial data provider. He spoke to us via a video link from Bangalore, where he was visiting a one-year-old office. He stressed the need to communicate openly and frequently with employees, particularly new ones, to keep them united around a common vision – something that’s especially critical for companies that have grown via acquisitions. And culture needs to be embedded into core processes like performance management and compensation to keep staff motivated and avoid transformation fatigue.

Tanuj said the biggest question companies must address in forging their strategy isn’t the “what” or “how” but “why?” And to really get employee buy-in, give a clear answer to “What’s in it for me?” The bank these days talks about workforce transformation in terms of guaranteeing employability, not employment; it’s a matter of investing in skills they will need for a successful future in banking. When Standard Chartered launched its Fit for Growth transformation program earlier this year, executives explained that cost containment was vital to increasing operating leverage, improving client and employee experiences, and driving growth.

• Embrace the new technology but don’t forget the old. Financial companies tend to have lots of legacy technology that has to be managed even as much of the world pivots to the next new thing. David said LSEG thinks carefully about ensuring the firm has talent with experience of transitioning from legacy systems to modern technology. Such evolutions can take three to five years, and it’s vital that the timeline is aligned with the firm’s broader strategy. Generative AI is radically different, bringing rapid disruption, and potential employee angst. For Tanuj, driving adoption isn’t a tech challenge but a challenge of culture, skills and leadership. Standard Chartered recently announced it would incorporate generative AI in its year-end processes, including employee feedback, and give staff training and sand pits to get comfortable with it. The aim is to make clear that the technology is for everybody, and the bank is shifting to a human-plus-AI model. Companies need to tackle tech disruption head on because it’s only going to accelerate, said David. Leaders need to show by example that technological change brings an opportunity and can be energising.

• Know when to lock in, and when to kick back. In a world of disruption, leaders increasingly need to take decisions in the fog of uncertainty and our speakers shared some helpful tips. Tanuj looks for data to check her own biases but cautions against the idea that data alone produces perfect decisions. In most cases, reaching 80-85% conviction about a particular decision is good enough to take a leap of faith, she said. For David, a critical part of decision-making is accepting that you’re going to make some mistakes “If I feel like I’m getting four out of five big decisions right, that’s pretty good.”

At the same time, leaders need to step back to keep their minds and bodies fresh. David tries to carve time out of his schedule to think and read – he’s just finishing Walter Isaacson’s biography of Elon Musk. He also likes spending time with customers, calling it his “personal R&D.” Tanuj is also an avid reader – she shuns airline WiFi and recently finished “Invisible Women,” about gender bias in the world’s data. She’s also a big believer in finding moments of joy at work, including a break she took to explore the bank’s archives during a recent stop in Hong Kong.

Many of these themes were echoed by participants in the breakout sessions. Some expressed the view that the overarching objectives of strategy don’t change frequently but the “how” to achieve them does, while others emphasised the need for strategy to be clear on what NOT to do. Others talked about the need for leaders to build a movement from the board to frontline staff to align around the strategy and activate different levels of the organisation. And there were calls to empower and incentivise staff with data, such as providing carbon-emissions information to people purchasing flights.

We are firm believers in the view expressed by one participant, that “sharing enables us to solve our challenges together.”