Antony Jenkins and the FIFO test at Barclays
Many a year ago, when I was working at BBC News, leadership by acronym was very much in vogue. One department head who favoured a flamboyantly macho style enjoyed satirising the culture by describing his approach as the FIFO model.
The Vogel Wakefield blog is too polite a space in which to spell out the meaning of FIFO. Suffice to say the manager’s broad intent was along the lines of, “Kindly toe the line or consider finding employment elsewhere.”
I was reminded of this on reading the email to Barclays’ staff sent by the bank’s chief executive, Antony Jenkins, redefining Barclays’ purpose and values.
The purpose (“Helping people achieve their ambitions – in the right way”) and values (respect, integrity, service, excellence and stewardship) were interesting enough, and I’ll come to those. But the sting in the tail was Mr Jenkins’ invitation to staff who don’t buy into the new framework to consider their position:
“Performance assessment will be based not just on what we deliver but on how we deliver it. We must never again be in a position of rewarding people for making the bank money in a way which is unethical or inconsistent with our values… I have no doubt that the overwhelming majority of you, no matter in which area of the business or country you work, will enthusiastically support this move. But there might be some who don’t feel they can fully buy in to an approach which so squarely links performance to the upholding of our values. My message to those people is simple: Barclays is not the place for you. The rules have changed. You won’t feel comfortable at Barclays and, to be frank, we won’t feel comfortable with you as colleagues.”
Taken together, the purpose, the values and the adoption (albeit in a more sensitive fashion than my former BBC colleague) of the FIFO model, signal a serious declaration of intent. But I foresee difficulty for Mr Jenkins in turning around the legacy of 30 years’ application of the FIFO model to a rather different purpose and set of values. Like most other banks, Barclays has given the impression of pursuing a purpose of the self-enrichment of its own executive caste, betting the farm on investment banking, dismantling the service culture built over generations in retail banking, and fleecing the customer with whatever products it could sell regardless of need.
While it’s refreshing to see stewardship among the values Mr Jenkins advocates, the striking thing about values statements is how similar they look from one company to another. What company would say it doesn’t aspire to respect or excellence? Mr Jenkins talks in his email of training a thousand colleagues to enable them to explain to everyone else in the bank the importance of values. But, for me, the more material question is whether Barclays still retains the capability to deliver the kind of retail banking that would “help people achieve their ambitions”.
The success of Mr Jenkins endeavour will depend on how effectively he can use his newly defined purpose and values to create honest conversations in Barclays about what it would mean to fulfil them and what factors might pull the bank in another direction. The trouble with identifying intended values is that it creates an impression of coherence and consistency where in fact organisations usually embody contradictory values simultaneously. Organisations fail in embedding values because the discourse about the attractive, intended values often fails to address the contradictory values that may also be at play. In fact, many organisations make it risky for employees to draw attention to such contradictions – as the experience of whistleblowers in banking, the NHS and elsewhere has demonstrated.
For this reason, I would be sceptical about relying mainly on training as the method for embedding values in employees’ behaviour. Training programmes reinforce the idea that it is simple to achieve consistency of behaviour behind intended values and they often filter out the noise and nuance introduced by contradictory values. They encourage compliance rather than judgment. But it is judgment that enables employees to navigate ethical dilemmas.
When an organisation has suffered a loss in public trust, as Barclays and many other banks have, a renewal of values-driven behaviour depends on the leadership enabling the organisation to be honest with itself about how it lives with tensions in its values. This begins with the leadership group itself developing the habit of honest acknowledgement of these tensions. It needs to formalise practices which invite challenge to orthodoxy and exposure to external feedback that cuts through group-think. The task is not to create an elegant system that glosses over ethical difficulties, but one that recognises ethical messiness and enables reflection on how to deal with it.
From there, the leadership group will be in a stronger position to consider how to institutionalise an ethically-grounded approach throughout the organisation. Their task is to cascade downwards the capacity for judgment and reflection; to empower and incentivise staff to make decisions locally that optimise customer service within an ethical framework. Mr Jenkins seems to be firmly minded to address the incentives, but will the empowerment be there?
Coverage of Antony Jenkins’ announcement pointed to cynicism among those on the trading floor about whether the chief executive’s initiative would amount to much. A tweet from Yahoo’s finance team quoted sources as saying, “This happens whenever senior leaders change, a few meetings, training sessions and memos then it’s back to normal.” I sense that Mr Jenkins’ move is more substantial than this. Barclays has been more exposed than other banks to the public’s fury and Mr Jenkins, untainted by the investment banking business, seems acutely aware of the existential nature of the crisis it faces. By defining anew the bank’s purpose – with its emphasis on doing things “the right way” – he holds out the possibility of pursuing strong financial performance by first serving customers well and repudiates the prioritisation of financial value that lead to neglect of customer value and, ultimately, ethical and reputational failings.
But there’s a tough road ahead not only to build a bank that’s fit for purpose, but to neutralise the legacy culture and face down the cynicism. If he gets it wrong, it may be him who faces the FIFO test.