18.
People-centered cultural biases
A people- or team-centered culture can be a valuable asset, a source of competitive advantage, and a means to create long-term value. It has particular value to investment firms and their clients because the outputs from these firms derive most of their power from human and intellectual capital.
KEY POINTS
- The edge from a people-centered culture comes in various guises: It encourages maximum creativity, facilitates collaboration, and confers personal recognition; it helps workers develop through training, mentoring, and performance management; and it makes allowances for top talent and high performers, while respecting all professionals. A people-centered culture is also likely to be more ethical and purpose driven relative to one that is single-mindedly driven by results, with greater emphasis on diversity and inclusion as well as stakeholder responsibility.
- Investment firms are people businesses in which talent is intrinsic to success. The factors that secure talent include compensation, but intrinsic motivations often are more significant. These include: autonomy—people like to have flexibilities and clear levels of discretion in their work; mastery—people like to develop deeper skills; purpose—people like work that is meaningful to them; recognition—people like their work to be recognized and appreciated; and good colleagues—people like talented and empathetic colleagues, as well as a sense of belonging.
- Employees with these strong values apply them to client relationships. Other narratives speak to the need for a concerted effort to improve ethics, trust, alignment, and competencies in client relationships. Regulation and sanctions clearly have their place but will not on their own deliver effective behaviors.
- Among survey respondents, 54% strongly agree that they personally have a strong sense of purpose and wanted to do meaningful work, but only 28% say this was true of their firm overall. The gap between the two figures indicates cultural limitations in which strong leadership vision is needed to bolster organizational purpose and better cultural leadership is essential.
- The style of leadership increasingly appreciated in the investment industry is an empowering one that distributes responsibility and accountability but is present to help individuals reach their potential and accomplish their goals. A prominent example of this leadership style is servant leadership (see Greenleaf 1977).