Clients

American Bankers Association

17 participating financial institutions (average 8,000 employees each)

The Need

American Bankers Assn The American Bankers Association (ABA) convened its inaugural Chief Learning Officer Summit in early 2004. The summit involved CLOs from some of the nation's leading banks, and was intended to provide a forum for the CLOs to learn from each other about current best practices and to explore the relationship between each organization's human capital investment and its overall business performance.

A central element of the summit was a benchmarking study, using standard measures to compare human capital practices, systems, and investments across organizations, and to examine the effects of those elements on overall business outcomes. After concluding that "McBassi's systems were adaptable to our requirements, yet highly robust," the ABA partnered with McBassi & Company to capture and benchmark this information. McBassi & Company's proprietary Human Capital Capability Scorecard (now McBassi People Index®) methodology was used as the foundation for gathering benchmarkable data on an array of human capital indicators for each bank.

Findings

In order to provide the most useful benchmarking information, customized reports were prepared by McBassi & Company for each participating bank. Each report compared data on approximately 25 different human capital elements, providing the individual bank's data and showing how it compared to averages for relevant comparison groups (e.g., banks of similar size, similar operating structure, as well as all participating banks).

In addition, McBassi & Company analyzed the relationship between the human capital factors and bank financial outcomes, and found clear evidence of a positive relationship between banks' financial performance and the investments they make in professional development and other human capital best practices. The study concluded that "those institutions that demonstrate the greatest commitment to human capital enjoy the greatest financial rewards".

The strongest evidence supporting this relationship was observed for the variable measuring total training and development expenditures per employee FTE. This variable saw a positive relationship for each of the five different financial performance outcomes that were examined in the study. This was of particular interest to participating institutions, as virtually all of them had reported that their training budgets were unstable and always at risk.

The Results

Participating CLOs and their financial institutions have used their customized benchmarking reports to assess the status of their human capital practices and investments relative to their peers, and to identify areas for improvement. The results armed the participating CLOs with compelling evidence of the business imperative of investing in the development of employees, and gave specific guidance on where to focus their efforts moving forward. Many used the overall conclusions of the study as an important piece of evidence that additional stability is needed in their human capital investments in order to enable an optimization of banks' ability to develop and manage their people in ways that contribute to positive financial outcomes.

The Executive Director of ABA's Professional Development Group, J. Douglas Adamson, concluded, "Working with McBassi & Company has been both beneficial and pleasant. They produced the 'holy grail' empirical evidence that we had always known to be true, but had previously been unable to demonstrate-linking banks' human capital investments and processes to financial outcomes. Their work is cutting edge, and working with them has created a competitive advantage for us."

Clients

American Bankers Association

The Need

Findings

The Results

Clients

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