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Solving the culture conundrum in software engineering

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Alistair Doran, Principal Consultant – Digital Transformation & DevOps, Exponential-e

 

The one crucial ingredient underpinning our transition to a digital-first economy, more than any other, is software. That’s why software engineering has become one of the world’s most in-demand professions.

In the UK alone, the median salary for the role has increased 13% year on year, as businesses look to stay ahead of the competition and attract the very best IT talent. But the high salary often isn’t consistent with where software developers stand in the business; many organisations still view them as suppliers, rather than as crucial players in their success.

Based on the current speed of transformation, we know demand for software engineering is only going to increase. So business and technology leaders need to urgently consider vital cultural changes to help better integrate software development teams within the wider organisation. But what exactly should they be?

 

The development dilemma

Agility has quickly emerged as a competitive advantage, as businesses strive to deliver on customer expectations quickly and effectively. That’s heralded the rise of DevOps, which aims to write high quality digital solutions more efficiently, and have the ability to continuously update in a secure and low risk way.

The practice is already accelerating feedback loops in the software development of digital solution on a wide scale, meaning new software is brought into production as fast as possible and with reduced risk. As a result, today’s successful businesses are now releasing software updates multiple times a day. The figure even runs well into the tens of thousands for tech giants like Amazon and Netflix. However, other businesses are struggling to keep up with the speed the market demands, largely due to a lack of clear communication, ways of working and integration between software developers and the wider business. It’s a dilemma that needs immediate attention if businesses are to remain at the competitive edge.

Developers are too often left to deal with huge monolithic pieces of work, which require them to write code for months on end without it being road-tested. This inevitably leads to mistakes which are found only once the updates have already been released to market, creating a ripple effect throughout the organisation. It’s an all-too-common scenario that demonstrates business leaders’ clear lack of clarity and understanding about the colossal value adopting a DevOps culture can deliver for the wider business, including its customers.

Take financial institutions looking to introduce a new offering, for example, such as a new mortgage product. Without a collective approach to development, getting the back-end systems up and running for a product can take up to six months. But modularising the options and breaking down the functionality can shorten timelines to weeks, as we encountered on a recent project.

Business leaders must look to create unified, cohesive and cross-functional teams that work together on projects that are broken down into simplified and localised components that can be easily integrated together without a negative impact on each other. It might seem like a small strategic change in working practices, but its impact on the speed and efficacy of software development can be enormous.

 

Revisiting personalities and processes

The role of the software engineer has changed. It is no longer about writing code in isolation, without much regard for or knowledge of how it benefits the business. Developers work better when they have clarity about the direct impact their work will have on achieving business goals and on the bottom line. It’s down to business leaders to communicate these challenges and goals (in other words understand the “Why”) to help software developers understand what they’re trying to achieve. But doing so in a way that moves towards a better working culture requires a new approach to building and managing software development teams.

The first step is casting aside the negative stereotypes many have of software engineers and celebrating the intellectual and cultural diversity within their teams. Diversity of personnel brings diversity of personalities, which is crucial to creating more inclusive cultures that accept and welcome all characters with open arms. While this may seem obvious, what is often overlooked is the impact diversity can have on stimulating and increasing innovation.

Improving the diversity of development teams helps unlock multiple ways of responding to and analysing the challenges brought forward by business leaders. After all, each individual has an array of different soft and hard skills based on their learning, development and experience. So, encouraging individuals to bring their characters and personalities to their roles is crucial; it ensures each and every stakeholder in the development process is empowered to contribute, feels inherently valued, and is able to challenge existing assumptions, helping deliver a more robust end product.

Recognising and harnessing this spectrum of skills also helps bridge many of the barriers to development that exist within businesses. Some software engineers, for example, might struggle to communicate technical updates in a way the wider business can understand, but tapping into another individual’s strong communication skills can help unite teams – and entire businesses – around one, holistic digital strategy.

 

Channelling change to deliver better outcomes

Clearly, cultural change is needed to embed software engineering at the core of modern business. But revisiting project management practices is also imperative to continually deliver software that provides value to the business, the world of Scientific Management and Waterfall delivery methods is no longer appropriate for the development of digital solutions. With such a heavy reliance on digital services, businesses – and consequently developers – need to be able to make changes with minimal effect. So, eschewing monolithic projects and encouraging cross-functional teams is essential. Not only does it reduce the need for sweeping software updates, but it negates the risk of a project failing to meet the initial brief, which could ultimately impact the entire business.

By reviewing organisational processes, and bringing the wider business and software developers together, we can create teams that deliver digital solutions effectively and quickly, so that every user, whether internal or external, reaps the benefits of a more sophisticated approach to software engineering.

 

Business

Financial Services Makes Gains In Employee Engagement

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By Phil Chambers, GM Workday Peakon Employee Voice 

 

A new report shows that the financial services industry improved in almost all elements of employee engagement last year. Can such momentum be sustained?

After more than two years of change, one thing is certain: keeping workers engaged has become more challenging – and more urgent. Record numbers of workers have left their jobs in the UK. And, as turnover has increased, employee engagement – people’s mental and emotional investment in their work and workplace – has been tested. In today’s climate, engagement isn’t a nice-to-have; it’s a business imperative – especially as companies with engaged employees are known to reap benefits including higher productivity, customer satisfaction, and profitability.

The financial services industry hasn’t been immune from the so-called Great Reshuffle. But, according to Workday’s latest State of Engagement Report, it did make measurable gains in employee engagement during 2021. Of the 17 industries analysed, financial services’ engagement ranking jumped from ninth to fifth place.

The report analysed nearly 9 million employee responses from almost 2.5 million employees throughout 2021. It compared the engagement scores given by employees working in different industries over the 12-month period, as well as scores for the 14 drivers of engagement – including autonomy, goal setting, meaningful work, reward, and recognition.

Organisations in the financial services industry have been considered less   quick to evolve than others. PwC recently characterised insurance companies, for instance, as “traditionally risk-averse and slow to change”. But, as the report shows, financial services clearly made some improvements. It is noteworthy given the enduring pandemic-related economic turbulence of 2021 – and the fact that during that time global engagement scores overall slightly declined.

 

Where The Financial Services Industry Improved in Employee Engagement

Remarkably, the financial services industry saw increased rankings and scores in all but one of the 14 engagement drivers that the State of Engagement report measures.

Of all 17 industries analysed, financial services took top place for goal setting by the end of 2021 (up from sixth at the start of the year) and landed among the top three sectors for strategy and recognition too. These strong results indicate the industry provided clear direction to its people at both individual and organisational levels, and appropriately recognised employees when they met their goals.

The improvement in the industry’s overall engagement, however, was driven largely by a sizable increase in its environment driver score in 2021, suggesting that a significant number of employees responded positively to having more freedom around where they worked during the pandemic. Before the pandemic, it was unusual for financial services firms to offer flexible options at all. But, in 2021, more than ever before, many firms’ employees were working remotely or enjoying a hybrid of both remote and in-office work – as and when offices started to re-open. This unprecedented choice in where, how, and when they worked was appreciated, as the report indicates, by many workers in the sector.

 

Where There’s Room For Improvement

As the report found, many employees feel the amount of work they have is increasingly unmanageable. Workload continues to be a pain point across all industries globally, with workload satisfaction scores dipping slightly in 2021. At the end of the year, financial services received its lowest engagement-driver score for workload and ranked 11th among the 17 industries analysed.

This indicates employees in the financial services industry found their workload less manageable as the year progressed, which is perhaps unsurprising when considering the pandemic’s ongoing toll in many parts of the world, and the fact that remote working can lead to ‘always-on’ work lives.

To help mitigate burnout risk and diminished engagement going forward, financial services leaders and managers will need to stay close to their employees in the months ahead to find out how they can best support them, whether that’s with additional resources, greater work flexibility, or updated benefits. By regularly staying abreast of people’s needs and taking the necessary action, organisations can spot potential problems before they lead to resignations.

 

What The Industry Should Avoid Going Forward

In recent months, we’ve seen some financial institutions try to take a “return to normal” approach, requesting their people go back to working onsite five days a week. But, as the report shows, this approach may not be the best one for everyone, particularly as the past two years have revealed that many employees appreciate and benefit from a greater degree of flexibility.

Of course, not all organisations will be able to provide hybrid or remote arrangements for all their people. But greater flexibility doesn’t necessarily have to mean working remotely. It could mean more flexible scheduling options, or a shift in working hours to enable a greater work-life balance.

Either way, to retain the engagement gains achieved in 2021, the financial services industry should resist the temptation to look back, and must instead take learnings from the past two years. Amid so much economic and societal change, and with employees continuing to shift jobs in record numbers, companies cannot simply go back to before, but need to continue moving forward, listening to the needs of their people, and leading with empathy.

Specifically, leaders and managers in financial services will need to stay closer than ever to employee feedback, going beyond listening and working fast to implement change accordingly.

For the industry to continue making positive gains in employee engagement, it will need to: consider how to retain a degree of flexibility – updating models to reflect evolving employee needs; continue to provide clear individual and organisational direction to those working remotely and on site; create and maintain more manageable workloads through prioritisation and automating repetitive tasks; and continue to reward and recognise employees for their hard work and achievements.

While great strides were made last year, it’s more important now than ever that leaders in the financial services industry determine and understand how employees are feeling so that organisations can explore and shape a future of work that works for everyone.

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The FTX collapse: Lessons learnt for the CFO

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‘A complete absence of trustworthy financial information’ were the words used to describe the cause of cryptocurrency exchange FTX’s demise last week. Although an extreme example of incredibly poor risk and data management, it brings to light – yet again – the importance of getting financial planning right.

Following the collapse, the question on everybody’s lips has been – could this have been avoided? The answer is highly complex, however identifying, managing and mitigating internal and external risks should be at the top of senior leadership’s priority list – simple. The teachings here for CFOs across all industries are rooted in risk management. It was a lack of planning from senior executives that caused the current crypto industry crisis and should be considered a wake-up call to senior leaders across a multitude of sectors.

We are entering an uncertain economic winter, and CFOs are facing risks previously unknown, which are going to be impossible to mitigate without valuable insight and suitable technology. In the rocky months ahead, operational ‘leaks’ or financial losses will not be limited to crypto companies resisting the lasting effects of FTX’s collapse. If businesses across all sectors are to survive one of the most complex economic environments in recent times, CFOs will need to ramp up their risk management.

Hartmut Wagner

A Deloitte survey of CFOs found that 63% believe recession will hit within the next year and are already dealing with the sharp rises in financing costs. Additionally, the International Monetary Fund (IMF) has forecasted that global growth will falter from 3.2% in 2022 to 2.7% in 2023 because of tightening financial conditions in most regions. Ultimately, the outlook is challenging enough without the prospect of avoidable risks that can be prevented with the right planning and processes.

 

Automate systems or sink

Recent Gartner data shows that under one-third of CFOs are confident that technology they have available to them can ensure future company success. But to survive the recession and thrive on the other side, technology will be key throughout the finance function.   The Great Resignation has also added urgency for CFOs to automate more business and financial processes. The labour shortage, which started in hospitality and airlines, has hit the financial sector and has created a skill gap that senior leaders are battling to fill. No one is immune, as even Deutsche Bank and Goldman Sachs are suffering ‘talent wars’ as they fight to attract and retain finance professionals.**

Additionally, CFOs are facing ‘quiet quitting’, another problem that translates to increased employee disengagement which has recently gone viral across social media. The trend, gaining traction across Europe, encourages workers to avoid going above and beyond their job description and is lowering productivity levels. Automating the finance function, for one, alleviates the pressure on stretched teams by adding a virtual ‘team member’ that can take over repetitive and time-consuming transactional processes. This can break the negative cycle of further resignations as remaining employees will have more time to focus on strategic decisions, offering them the chance to become true value creators. Removing these arduous manual tasks will also attract employees and give businesses the upper hand in the ongoing ‘talent war’.

Take processing invoices as an example. It’s a simple but time-consuming task that can often be derailed by human error. Intelligent software can create efficiencies by reducing the time to completion and eradicate costly mistakes. It can also help to combat issues associated with ‘quiet quitting’ as disengaged employees will have time to focus on the tasks that they find more stimulating.

 

Achieving well-rounded cash visibility

In this period of economic uncertainty, cash is no doubt king and having a rounded view of company finances is crucial. Staying on top of a business’s cash position is tricky and slow if balances are still being drawn by hand. It’s labour intensive, time-consuming and there’s risk of being blindsided by putting valuable time into non-strategic tasks.

Instead, technology that uses artificial intelligence (AI) can provide clarity on current and future cash balances and flows, meaning CFOs can anticipate potential cash flow concerns before they become a problem. Plus, the technology can provide actionable insights into the spending and cash flow trends of a company, and AI can forecast potential hurdles and scenarios ahead of a business in a way that people alone can’t. This means the CFO’s decision-making powers grow and deliver better risk management. For a job based on data, implementing technology like this should feel like a natural progression.

 

The future CFO, now

The recent FTX collapse – rooted in a lack of financial planning – only highlights further that humans, without the right technology solutions, cannot deal with the risk management complexities in the modern era. Interestingly, a Gartner Survey conducted this summer highlighted that 45% of CEOs and CFOs would cut digital investments only as a last resort in difficult economic times. Employees and technology were prioritised over investments in mergers and acquisitions, which highlights CFOs’ recognition of the success of technology in driving efficiencies and protecting margins.

Even within industries less volatile than crypto, the threat of collapse is on the mind of most CFOs as we enter a period of economic downturn. For some, the risk might seem less obvious and, therefore, it’s impossible to accurately mitigate against without the right tools. Consequently, over the coming months, it is technology what will set one CFO apart from the next.

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