Keith’s comments:

Obama and Cameron have supported Professor Thaler’s “Nudge Theory”, which promotes the human side of financial decision-making – hurrah! My question is, what has happened to this common-sense approach? Did our industry decide it was too touchy-feely?

My premise is that financial, analytical skills need to be enhanced with soft skills training– surely a trueism? Do I need to nudge or shove this idea?!

-excerpt from the CIPD Press Release on 4/25/2012 – “From E-learning to gameful employment”

It is really heartening to hear that the CIPD are enthusiastically promoting and embracing new approaches. The gamification of learning utilizes new engagement techniques which can even be applied to compliance learning – I believe there is residual prejudice about this route to learning. Watch out for our forthcoming poll!

What caught our eye at the conference on Training, Development & Learning Technology Innovations held in New York, last month?

Here is a conference known to capture the pulse of learning & development issues.  And, although there was a buzz about some experimentation – games, delivery technology, and some social media (mostly collaborative), – there were few real innovations discussed.  Much of it focused on retrenching around L&D fundamentals.

Most found it refreshing to regroup around some core issues:

• Validation of training is good to get, but hard to measure. Most delegates shared efforts to ensure that as part of their tailored approach to training, they also established success measurements at the design stage. How else can you hope to achieve ROI as the fundamental objective of training?
• What are the characteristics of great learning experiences?  Relevance – Interactivity – probably, deeply engaging elements – definitely a sprinkling of fun! Think back to your own training highlights?  The answers spawned discussion around a plethora of existing technologies being used to update the fundamental training experience – some collaborative, some virtual and some efficient experimentation.
• Integration and augmentation of existing systems and technologies was a visible theme – Know any companies that have spare bandwidth to support new technology initiatives? The over-riding message was to give a new face and a new twist to a more streamlined version of what already exists. There was no escaping the current market climate.
• Learning comprises a potent mix of information, concepts and skills, all delivered as experiences   – that’s the bottom line. We at Consultancy Matters use experienced and expert Associates to engage and deliver these.  Throw in learning techniques, real world scenarios, and maybe a sprinkle of games, and we have a recipe for sustained learning .
• We are also thinking outside the box and across competencies to optimize ROI.  We are linking financial risk training with leadership competencies to create a holistic solution to develop successful professionals, across disciplines and throughout  the organization.

In the end, there were some new technologies, some new ideas and approaches, no rocket science, but great fundamental upgrades!

In the fast changing world of bank regulation right now, Rachel Wolcott has picked up on a very important and topical debate with her article in the Financial Regulatory Forum, “Time to merge risk management and compliance?”. Indeed, non-compliance with the myriad of bank regulations is a significant risk for banks – both financial and reputational. I see this as ”regulatory risk” and it is closely associated, in my mind, with that other ”newer” risk called operational risk.

In my experience, I have seen banks with separate Risk and Compliance departments; banks merging the two; and banks merging and then de-coupling them! The separation has often been due to the rapidly growing (# of staff) and complex (# of regulations and reviews) nature of compliance that banks are stretched just to keep on top, without adding the upheaval of integrating compliance into their risk organization.

The bottom line, however, is that many of the risk silos that we see in banks – credit, market, operational , as well as compliance – have been built for organizational reasons and not logical or functional ones. The contagion effect in risk which we have all experienced over the last few years, (whether it is from market to credit or operational to regulatory), makes the oversight and governance of risk silos very difficult. An intrinsic or holistic view of bank risks in a truly integrated fashion that includes non-compliance with regulations, is the only true and water-tight second line of defense.

In the current atmosphere of “banker bashing” it was heartening to see a constructive approach to improving good governance at board level – we see so much about talent recruitment and retention. And sometimes forget the talent that sits amongst our NED’s?

Improving the processes and dynamics between executive directors and non-executives, it transpires in the report, has some way to go. I have long believed that NED education around risk issues is essential – it enables risk officers to have more meaningful and informed conversations with the board – no translation required. I put my money where my mouth is, and offer coaching and tutorials to assist this process (also available at the Downloads Library).

Hug a NED today – they are there to be appreciated and utilised!

Exciting developments indeed! Consultancy Matters is working with leading electronic game developers in the Financial Services arena to help drive evolution of our learning market – a personal passion of mine. You can download more information on gamification here at our Downloads Library.

The gamification industry is growing rapidly and evolving, and like many “young pups” is stimulating some lively debate. Natasha Singer’s article for the New York Times prompted a strong response from Gabe Zichermann on the gamification blog.

The misconceptions around gamification will rumble on for a while – I’m tempted to sign off with a glib – it really is not child’s play – in reality it is potentially one of the most exciting developments in our training and development industry. Let the games commence!

See this space next week for our key conference theme highlights…

One of Carl’s questions – What skills or qualities are needed to become a good CRO – drew some very insightful responses. Each panelist gave a one or two word answer:

• Integrity
• Good memory
• Judgment
• Strategic Thinking
• Communication

To me, these are very much the skills that belong to good leaders – CEOs, CFOs or CROs. And in my view, the ability to communicate is probably the most important of those cited. In particular, the ability to communicate the risk values and culture of the organization – both up and down as well as inside and outside of the organization.

Finally, if these leadership qualities are what we want to see in an exemplary CRO, how many of the incumbents today possess these skills? Do we have CRO’s in our financial services industry that demonstrates the kind of leadership implied by these skills? If not, are there more accidents waiting to happen?

If we do see CROs demonstrating strong leadership skills, then we should keep an eye on them. They are well placed to become CEOs of banks or other financial institutions. And that would be a huge endorsement for the risk profession!