Can Bankers Change?

What does the continued problem with how our biggest banks are run teach us about change management?

The Atlantic published an excellent article about the banking industry – see: http://www.theatlantic.com/magazine/archive/2015/05/can-bankers-behave/389558/

The question asked is – can bankers behave?  The answer is obviously yes, but the structure of certain banks makes that change very very hard.

The article is ultimately a story about ethical habit formation and how change occurs. What I want to discuss here is the part of the article that focuses on the CEO of Morgan Stanley, James Gorman.

While we can debate the merits of the changes made at Morgan Stanley, what isn’t debatable is that Gorman was successful at making the changes he wanted to make.

Why was he successful when so many people struggle to create change within their organizations?  His attitude was if you don’t like the changes – leave. If you want to work at a hedge fund – do it – our core business is that we are a bank. And people did leave. And that was ok.

The mistake that managers wanting to create change make is in thinking – they have to make people change. The reality is that not everyone will change. Not everyone wants to. It’s ok if they don’t; they just need to find employment elsewhere if the fit is no longer good for them.

Change is hard. People resist it. That is normal. It’s a process that takes place over time and you will have early adopters and once the change is proven to work, mass adoption. And, there will be some holdouts that refuse to change. Sometimes you can drag them along kicking and screaming and they will become your biggest advocates. And sometimes, you just need to let them find employment that is better suited to them.

Accepting that you can’t be everything to everyone takes courage.  It takes courage to stand by your core mission as an organization. This is especially important if your corporate culture has allowed unethical behavior to propagate. Changing the culture to promote ethical behavior means, some people will have to go. Never allow people who want to be unethical to steer you off course and keep you from creating the positive social change you know is right.

FYI -  discuss the change management process in detail and how to use behavioral psychology to help this process along, paying specific attention to resistance to change, which in the behavioral model is considered an extinction burst and it’s predicted. Understand why and how that resistance will help you manage it when it occurs. (See:  https://humanistlearning.com/change1/)

How Times Change

And yet, some things always remain the same. Like, how many of us hate change!

Routines are comforting.  We don’t have to think too much about them. We just do them, as if on autopilot and stuff gets done.  Like, laundry, or filing an annual report, or any number of mundane work tasks.

Workplaces are filled with repetitive tasks.  It’s not just manufacturers who stick to their processes. All workplaces do.  Whatever it is that has to get done, from cooking a hamburger to new client intake, to payroll all has a process.

And these processes are really helpful. They can help us get a lot of stuff done very quickly and with minimal error; precisely because – they are done the same way every time.

Processes are only a problem when we need to change them.  And suddenly all heck breaks loose.

No one knows what they are supposed to do anymore. No one knows who is responsible anymore. The new system doesn't seem to work as well as the old one. Why did management think we needed to change when the old way worked so well!  We have all been there and done that. It’s even painful to think about.

And yet, change sometimes is necessary. If a process isn't working, it needs to be changed.  So how do we help our staff change when it is necessary with as little trauma as possible so that their sanity and ours is saved?

The answer has to do with understanding how habits are formed and more importantly, how we unlearn old habits. Every business process is completed through habit.  And old habits are hard to break. Understand that going in and your change management process will go a LOT smoother.  It will still be a bit painful, but you will at least make the transition a little easier.

When we look at companies who do this successfully we see that their training programs are designed to foster new habit formation.  They don’t just tell everyone – hey – do it this new way and hope for the best. They train them on the new way – for about a month - until their employees can do the new process by habit – and THEN they turn them loose on the new systems. This is a pretty common practice at some of the larger restaurant chains whenever they roll out a new food item on their menu.

Companies who employ white collar workers should pay attention and learn from the success of others. If you want a smooth transition to the new way of doing things – learn how habits are formed and put in the time and energy needed to help your employees learn the new habits you want and need them to adopt.

To learn more – consider taking our “Why is Change so Hard?” e-course at Humanist Learning Systems. https://humanistlearning.com/change1/

Why do Humanists encourage self-education?

Humanists are dedicated to self-education because we understand that education is the key to Auto-Liberation.

The Atlantic had a brilliant essay recently by Ta-Nehisi Coates called Being French.  The subtitle of the essay is: It’s hard to learn a new language. But it’s way harder to learn a new culture. (See: http://www.theatlantic.com/features/archive/2014/08/acting-french/375743/)

This brilliant essay is about the role education plays in both subjugation and liberation.  Subjugation results from the restriction of learning. The problem is that we can do this to ourselves when we restrict our own learning. Maybe we don’t want to learn.  The problem is that when we refuse to learn, we limit ourselves.

Liberation is not something that is given to us. It is something we have to learn and earn for ourselves.  This is why self-education is the key to auto-liberation.

Ta-Nehisi talks about his own journey to cosmopolitanism, which is an attitude of openness to other cultures.  Cosmopolitanism is important because it opens us up to learning.

Ta-Nehisi provides an ample example of this when he talks about the self-education of the Cherokee.  Settlers hope that by educating the Cherokee – they could control them. The opposite happened.  The Cherokee didn’t restrict their learning to what was provided for them. They took to self-education and the liberation that comes with it as if their lives depended on it – because it did.

To quote Ta-Nehsis “Openness to education did not make the Cherokee pliant to American power; it gave them tools to resist that power. Realizing this, the United States dropped the veneer of “culture” and “civilization” and resorted to “Indian Removal,” or The Trail of Tears.”

Restriction of learning is a tool of suppression. Control of education is power. If you want to have power and autonomy, you have to control your own learning. You have to make learning a priority for yourself and to actively seek out opportunities to learn.  This is why Humanists consider education so important.

Ta-Nehisi continues, “In our time, it is common to urge young black children toward education so that they may be respectable or impress the “right people.” But the “right people” remain unimpressed, and the credentials of black people, in a country rooted in white supremacy, must necessarily be less. That great powers are in the business of using "respectability" and "education" to ignore these discomfiting facts does not close the book. You can never fully know. But you can walk in the right direction.”

That right direction? Self-education and auto-liberation.

Optimism Grounded in Reality

Why positive thinking isn’t actually very good for you.

It turns out, that positive thinking isn’t all that positive.  People who practice positive thinking are less likely to succeed and more likely to experience emotional shock and depression when their positive thoughts don’t create positive change.  The reason for this is that it turns out, thinking positive thoughts, makes you work less hard – and that translates into fewer opportunities to succeed.  See: http://www.newyorker.com/currency-tag/the-powerlessness-of-positive-thinking for a round up on some of the research.

So what’s an optimistic Humanist to do?  Give up their optimism?  No.  You will notice that I am using the term optimism to describe the Humanist approach, and not “positive thinking.”  Being optimistic is different from thinking positive thoughts.  Why? Because optimism is grounded in reality.

Positive thinking requires thought policing. And that’s incredibly hard to do.  It prevents people from experience the real emotions of stress and nervousness that often give us the nervous energy to try and change things, which leads to change – which is what most of us are looking for.  So why would we deprive ourselves intentionally of worry?

Optimism, unlike positive thinking, doesn’t eliminate the worry. Optimism is grounded in reality.  We may not succeed despite our best efforts.  But if you are optimistic, you harbor the thought that, if you try, you may actually succeed. No guarantees, but still, optimism helps us make the effort anyway.

And this to me is the real “secret.”  It you want to be successful in life, ditch the magical thinking.  Work hard and take responsibility to get things done.