DBS Bank in Singapore was named as one of the top 10 business transformations of the decade in Harvard Business Review. Author and digital strategist Robin Speculand outlines how HR helped it become the 'world's best bank' by supporting the implementation of its digital purpose to make banking joyful for both customers and employees
One of the most common questions I am asked when presenting at virtual digital conferences is “Am I going to lose my job?”
If you examine The Top 20 Business Transformations of the Last Decade (which I did), as identified in the Harvard Business School article in 2019, you will see that the top 10 organizations (excluding Ørsted, as public data is not readily accessible) increased their profits by an average of 874%. And their head count by 405%.
The short answer to the opening question is “Yes”, you will lose your job if you do not make yourself relevant in your organization's new business model. The onus of learning and development of employees has shifted from organizations being predominantly responsible to employees taking the initiative to upskill themselves. With the explosion, especially over the last two years, of online learning, it has never been easier for an individual to constantly develop themselves and more specifically learn the new skills required for digitalization.
One of the key messages from the phenomenal profit and headcount increase by the top 10 business transformations of the last decade is that when you successfully execute your digital transformation it increases your business and the number of employees. Since the start of the Fourth Industrial Revolution people have been fearing the loss of their jobs. This is a common occurrence in any industrial revolution and evolved into protests and riots during the Second Industrial Revolution in the 19th century, when new machinery was introduced in textile mills. Groups of unhappy workers smashed the new machines and burned down mills in the name of a mythical character called Ludd (the workers took inspiration from a legendary King Ludd living in Sherwood Forest). This gave birth to the expression "You're such a Luddite" – otherwise known today as technophobes.
One of the organizations that is in the top 10 business transformations of the last decade is DBS Bank, Singapore. The bank started its digital transformation in 2014 when its headcount was approximately 18,000 and today it has a head count of over 30,000. This begs the question, why are headcounts growing in successful digital transformations, when so many people are concerned about losing their jobs? We naturally know that some people will be casualties of constructive disruption. However, more importantly, what we're starting to see is that after the initial cost savings to the bottom line through automation, such as adopting chatbot, robotic process automation (RPA) and machine learning, the increase in business and growth to the top line is greater than the savings from the bottom line. The burden of responsibility is on each individual employee to keep themselves relevant in their organization's new business model.
I was fortunate enough to have exclusive access over two years to DBS Bank to research and write World’s Best Bank – A Strategic Guide to Digital Transformation.
The book tells the story of how DBS became the world’s best bank by leveraging digitalization. During my search I identified significant key actions instigated by the HR team to support the implementation of its digital purpose to make banking joyful for both customers and employees. These included:
Leveraging AI to retain key talent
An early success in the adoption of AI and data was being able to identify when an employee was considering leaving the bank and then proactively retaining those the bank wished to retain. The HR team built its own human capital analytics (HCA). The HCA team addresses the entire spectrum of people analytics—from reporting to predictive modeling—while providing insights on hiring, retention and productivity. The early success came in predicting when an RM (relationship manager) was considering leaving the bank. In many banks RM turnover is high. At the time the data was just sitting in the bank not being used. The HCA team identified that certain data would allow them to predict if RMs were likely to leave. The data included:
- Their first sick day and how quickly they took it
- Their number of days training
- Their branch’s location
- Their monthly revenue
- Their leave patterns
The 600 data points of the common/respective behaviors that employees demonstrated before they resigned were fed into the machine learning. With 85 percent accuracy, it told the bank which people were likely to leave within three months.
Today this model creates a monthly report (a digital nudge) that alerts supervisors about potential employees resigning, and it prescribes specific actions managers can take. When they take these corrective actions, the bank retains more than 90% of employees who might ordinarily have left. And for every 1% improvement in reducing turnover, the bank can save up to $5 million.
Adopting chatbots in HR
In 2018 the HR department launched 'HiRi', an AI-powered employee chatbot that provides easy, instant and personalized responses to HR matters 24/7. This self-service chatbot alleviates routine transactions, such as employees calling to check on the number of days leave they have left. This also allows HR personnel to focus on more strategic interactions.
JIM – AI recruiter
One of the most successful experiments and use of data has been JIM, short for Jobs Intelligence Maestro. In 2018 the bank launched Southeast Asia’s first virtual recruitment bot to make hiring wealth planning managers more efficient. In that year the bank hired 40% more wealth planning managers to support its rapidly growing wealth management business. With the increased number of applicants, recruiters were spending up to 20% of their time collecting information and responding to emails before meeting with their shortlisted candidates. The HR team sought ways to simplify the process. The bank also wanted to mitigate the risk of bias from, for example, cultural backgrounds, schools attended or grade point averages alone. A key impetus was also to make the journey “joyful” for recruiters and candidates.
JIM automated the prescreening process of reviewing résumés, collecting applicants’ responses for interview questions and conducting psychometric assessments.
Today JIM reviews résumés, collects applicants’ responses for pre-screening questions, conducts psychometric profiling assessments and answers questions. Its benefits are numerous:
- 24/7 – Candidates can apply to join DBS at any time of any day; they don’t need to take time off work. The process is less painful for the candidate, and internally recruiters save around 40 man-hours a month.
- Removes bias – Candidates are able to check online what the bank is about, its culture and environment. They can view a video job description and ask JIM questions. If they like what they see they can then move on to part two.
- Screening – Leveraging data analytics, the bank has built a profile of a top sales performer. This information informs the way HR assesses candidates. For example, candidates might answer situational questions that demonstrate their ability to manage difficult customers.
- Psychometric Test – Candidates have the flexibility to take the psychometric test at a time that works best for them. Prior to JIM the dropout rate at this stage was 50% for reasons such as candidates not having time to test in person or recruiters not following through.
Once candidates complete the test successfully, they are invited to schedule an interview. Because of JIM and these changes, the bank’s churn rate of sales new hires dropped from 27% to 18%.
As employee expectations and the nature of work evolves, DBS’s HR team continues to redesign the culture to make people’s lives better. The goal is to balance the financial with the nonfinancial benefits as the whole bank focuses on being more data driven—and more joyful.
Robin Speculand, pictured below, is the founder of three businesses and three associations, CEO of Bridges Business Consultancy Int and co-founder of the Strategy Implementation Institute and the Ticking Clock Guys. He is also a TEDx presenter and facilitator for IMD, Duke CE and Singapore Management University, and a prolific bestselling author. He recently authored World’s Best Bank - A Strategic Guide to Digital Transformation.
What we're starting to see is that after the initial cost savings to the bottom line through automation, such as adopting chatbot, robotic process automation and machine learning, the increase in business and growth to the top line is greater than the savings from the bottom line