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1997 General Excellence Optimas Award Profile Bank of Montreal

Bank of Montreal people have attitude. They have an undiluted, refreshing frankness, an unapologetic matter-of-factness. It’s easy to imagine the company’s motto might be, “Let’s get down to business.” It’s hard not to picture a lot of people rolling up their sleeves a lot of the time.

This is the kind of company that, when realizing its workplace wasn’t equitable, launched extensive task forces, and more importantly, assigned action steps and due dates, to resolve the problem. It’s the kind of organization that, when executives decided employees needed more training opportunities, built a $50 million shrine to education, the Institute for Learning. Even better, all these programs and policies intertwine. To create an equal playing field for women, for instance, flexibility issues had to be addressed, which boosted employees’ quality of life. For flexibility to work, employees had to gain a better grip on their careers, which prompted innovations like the Possibilities Centre. For that to pay off, employees had to function well in the turbulent banking industry, which meant the company had to ensure they could manage change.

Nurtured by Senior Vice President of HR Harriet Stairs and her people, this synergy has helped Bank of Montreal to record profits—and to the 1997 Optimas Award for General Excellence for success in six of the nine Optimas Award categories.

Competitive advantage: Leveraging the women in the workforce.
In 1991, Bank of Montreal (BMO) executives discovered an alarming statistic. Although they’d taken comfort in the fact that women constituted 75 percent of the company’s workforce, those women were woefully underdeveloped: Ninety-one percent were in nonmanagement positions. Clearly, something was wrong. Newly hired President and COO Tony Comper described the bank’s performance in achieving equality for women as “dismal.”

Executives created an HR-driven task force to identify women’s barriers to advancement, to decide how to destroy those barriers and to create action steps to ensure follow-through. The task-force members interviewed almost 300 employees personally, and in its largest employee survey ever, gathered more than 9,000 responses.

The comments were quite candid. A female senior manager observed, “For men… the sky is the limit, and if they aspire to be senior vice president (SVP), more power to them. If a woman aspires to be a SVP, everyone snickers and wonders who she is!” A male senior manager said, “Many years ago, my wife and I were the same grade. Now she’s a clerk and I’m in management. She chose family… wouldn’t it be nice if that choice had not cost her career. I have daughters. Please fix the problem.”

After reviewing the comments, the task force identified three major barriers to women’s advancement. First, many employees at the company harbored false assumptions about women. Second, the bank had done an inadequate job of providing women with the encouragement, opportunities and information needed to advance their careers. Finally, the bank was unsupportive of employees’ personal and family commitments, a shortcoming that heavily affected women with children.

To crush these barriers, the task force recommended dispelling myths about women, providing better information about career-enhancing opportunities, reducing work/life stress—and making managers accountable for ongoing change through annual reviews.

The myths about the bank’s women employees were easy to debunk. Thanks to a powerful HRMS system, the task force simply pulled up BMO’s workforce statistics. Employees soon had a document that set the record straight. Those who believed women quit the company after having children learned that women actually had longer overall service records than men at the bank. Employees who thought women weren’t educated enough to take top positions discovered that at nonmanagement and junior-management levels—the pipeline to senior jobs—more women had degrees than men.

To tackle the other barriers, the task force developed action plans with precise deadlines. To provide better access to job opportunities, for instance, a job-vacancy notification system would be created, and job information counselors would help employees by discussing their suitability for particular positions. To help employees develop their potential, action plans demanded that managers be trained in coaching and feedback skills, so they could better advise employees. Finally, to improve workplace flexibility, action plans required a new HR policy to support flexible work arrangements and the distribution of “how to” booklets to educate employees on work options.

“There was a really big push to set up programs just for women,” Stairs says. “We [in the executive group] have resisted every single time. Maybe more women need some services than men, but they’re open for everybody.” However, one women-only focus was established: The action plans set up a monitoring system so the bank would be forced quarterly to examine the rate of women’s advancement. Managers are required to set goals and action plans for the development, promotion and hiring of women and are rated on how well they promote equality.

Today, the bank is successfully retaining and promoting talented women. In 1991, only 7.5 percent of executives were women; today 23 percent are women.

The success is a result of year-round positive reinforcement, says Diane Ashton, vice president of workplace equality. Managers who foster equality receive both monetary and emotional recognition. “We don’t try to do this in a punitive way,” she says. “The strategy has been very much about celebrating the people who make it happen.”

Catalyst, a New York City organization that advocates workplace equality for women, has maintained a relationship with BMO since awarding it the 1994 Catalyst award for its equality initiatives. Comper sits on the group’s board of directors. Mary Mattis, vice president of research and advisory services, praises BMO’s work as: “One of the initiatives I’ve looked at that I have unqualified respect for. I just thought it was so systematic and methodical. The company covered its bases.”

Vision: A Future Workplace of Equality.
The executive team realized that achieving equality for women was only part of the effort to achieve equality for all employees. Within 13 months of launching the women’s initiative, the bank integrated two other task forces—on the employment of aboriginal people and on employing people with disabilities. A task force for advancement of visible minorities followed, creating a total of four groups propelling the bank toward an equitable workplace.

As it did with the women’s task force, employee feedback fueled action plans. For aboriginal employees, the main issue was lack of representation. Although aboriginal people constituted 2 percent of the national workforce in 1992, they made up only 0.5 percent of the bank’s workforce, most of them languishing in entry-level positions.

The problem was the bank had little understanding of or interaction with the aboriginal community, so few aboriginal people considered BMO a likely employer. Hiring requirements such as high school diplomas and computer know-how erected further barriers to aboriginal employment.

Once aboriginal people were hired, the bank offered no impetus for them to stay—a lack of mentors and support systems made acclimation especially hard. The task force’s action plans became, then, to develop a national workforce with at least 2 percent aboriginal employees by 1995, to offer more tailored recruitment for aboriginal people, and to pay more attention to aboriginal employees’ acclimation and retention. To achieve these goals, the bank developed networks to aboriginal organizations across the country and developed recruitment materials targeted at aboriginal employees. It ensured new hires were matched with fellow aboriginal employees to ease the transition. The bank also created internships to assist aboriginal people in meeting job requirements, and it started a summer student-employment program. Aboriginal employment by the end of the third quarter this year was up to 1.9 percent.

The task force discovered that people with disabilities were also under-represented. In 1992, they made up 2 percent of the bank’s workforce and 5.4 percent of the available Canadian workforce. Similar to women’s barriers to advancement, the barriers for people with disabilities were largely myth-driven. The task force revealed such misperceptions as the belief that these employees were less productive, took more sick leave and weren’t qualified. The bank also had done little to reach out to people with disabilities: Job descriptions were too inflexible to allow for much accommodation, and communications materials were exclusionary—printed materials didn’t come in Braille, and bank videos weren’t closed-captioned.

The task force fought these misperceptions with information. Hiring people with disabilities wouldn’t be costly: Up to 80 percent of individual accommodations could be achieved for less than $500. Managers underwent training to increase understanding of applicants with disabilities, and BMO began building a hiring bridge to people with disabilities. At the end of the third quarter of this year, employment of people with disabilities was at 2.4 percent.

The advancement of employees who were visible minorities was another story. This group, at 12.5 percent of the workforce, was actually over-represented: The available Canadian workforce was 9.1 percent in 1991. However, many minority employees felt excluded or underdeveloped at the bank.

To remedy the situation, action plans included improving career guidance and implementing an information system to track minority participation in career-advancement courses. BMO also rolled out a variety of diversity courses as well as English as a Second Language classes and management-skills education. Today, visible minorities make up 16 percent of the bank’s population, with 7 percent in executive positions.

“I don’t think we’re ready for any of this to take on a life of its own,” Ashton says. “We continue to monitor it and shepherd things along. But we’re making progress, that much is clear. I find that people who’ve been looking around for an employer—women, aboriginal, minority or people with disabilities—if they’ve done their research, they come to us first.”

Partnership: Teaming up to prepare tomorrow’s employees.
Just as the women’s equality initiative triggered an overhaul of the entire diversity system at the bank, so did the diversity overhaul bring to life another workforce improvement. The task forces urged better connection to community groups to meet the bank’s long-term hiring goals. So the bank set up partnerships to do just that.

In 1993, BMO joined the Native Employment Services of Winnipeg and the Winnipeg Canada Employment Centre to jump-start aboriginal student training to achieve its hiring goals. From a pool of 120 applicants, the bank selected 12 aboriginal students, each 18 or older with at least a 10th-grade education. A 22-week “upgrading” program gave the participants bank-teller skills and 12th-grade equivalencies. Upon graduation from the program, the students all were offered permanent part-time employment at Winnipeg bank branches, and some continue to work today at BMO. The success of the program launched similar spinoffs in Toronto and Ottawa.

In 1995, to give minorities a leg up in the hiring game, the bank partnered with the Board of Education for the City of York and the Black Business and Professional Association (BBPA) to create Leadership for Tomorrow Today. The program allows junior and senior high school students to work for two full days a week at the Bank of Montreal and to attend school three days a week during the school year. School days involve regular academic curriculum as well as leadership skills, problem solving, conflict management, career planning and computer studies. Workdays can unfold in any bank department, from the treasury area to the financial-services function.

The partnership has stayed on track through active participation from all involved. York Memorial College provides students with leadership counseling, support services and instructors who teach the students how to combine what they learn in school with what they learn in the workplace.

The bank offers students job placements and workplace mentors. The BBPA provides resource support and community mentors who consult regularly with the workplace mentors. “We feel that mentoring is important in the development of students’ skills and also in motivating them, building their self-confidence and helping them set goals. A lot of these students will have special needs, needs that require a mentor who can understand them—a mentor from the same cultural background,” says Chimbo Poe-Mutuma, president of Learning and Resource Centre, BBPA.

Other community partnerships have been established to provide internships to aboriginal, minority and disabled students across Canada.

Innovation: Aligning employees with success.
While lavishing attention on potential future employees, BMO also keeps a close eye on its current employees. The bank has four stakeholders to satisfy: shareholders, customers, communities and employees. HR obviously is charged with the employee piece, which is to create programs ensuring committed, competent employees in a cost-effective manner. This isn’t just talk, it’s a closely gauged mandate. The bank measures competency by surveying customers throughout the year on their satisfaction with employees. To measure commitment, the bank surveys employees, asking them questions like whether they feel the bank supports them and whether they’d recommend the bank to a friend. Cost-effectiveness is based on the cost of employees to revenue. Employees in turn are rated on how well they help HR and the company satisfy the other three stakeholders. (At year-end all the measurements, which are reported as indexes, are averaged into one figure of merit. The chairman presents this figure to the board of directors, who use it to decide his bonus.) “It points everyone in the same direction,” says Stairs. “The competency index drives the Institute for Learning; cost-effectiveness drives variable pay and flexible benefits; the commitment index drives the Possibilities Centre.”

The Possibilities Centre, created in 1995, has been integral to boosting both employee competency and commitment. “The Possibilities Centre is my love,” says Stairs. “If we want people to take responsibility for their own lives and their own careers, we have to give them as much information as possible.” Information is what they get. Employees dial a toll-free number and are linked to an internal consultant for career-management assistance.

Employees may have straightforward questions—What is the strategy for my area of the bank? How do I get an internal resume written properly? Or they may be more complicated—How do I move to another area? How should I prepare myself for my branch’s changes? The counselor leads them through the career-navigation services. Employees can access information about change, stress, flexible work arrangements, individual assessment tools, reading lists, job skills and competencies, and self-help guides such as resume writing, networking and interviewing.

Since January 1995, counselors have answered more than 5,000 calls. Feedback has been glowing, Stairs says. Employees can phone in any time, and they appreciate the objectivity of a private counselor. “We call it the Possibilities Centre because there are phenomenal possibilities,” Stairs says. “From taking sabbaticals to planning careers to flexing work options, here are the answers.”

Quality of life: Tying it all together.
No matter how much education, training, opportunities and assistance a company offers employees, it means nothing unless employees really believe the company cares. BMO complements all its programs with a comprehensive work/life approach. It’s a two-tiered initiative, addressing employees’ personal lives and community lives.

To assist employees in balancing their home lives, the bank offers one of the most flexible workplaces around. As of 1993, the most recent comprehensive study available, the company had more than 4,500 flexible work arrangements in place with participation at 60 percent women and 40 percent men. The most popular arrangement was flextime, in which employees set their own start and stop times at work. The second most common arrangements have been flexible workweeks, in which employees work a full-time schedule but not in the traditional five-day arrangement, and flex places, in which employees work outside the office.

HR has encouraged flexible arrangements by offering a booklet of questions and considerations for employees considering new ways of working. Employees can use the input when making a proposal to their managers. Jackie Church, consultant for WFD, a Boston-based work/life strategy firm, says BMO’s collaborative approach is a smart one. “It’s a lever to get people thinking about business success. Some people don’t even think about how their jobs affect business until they sit down to fill out a proposal.” Employees also have options such as permanent part time and job sharing as well as leaves of absence for up to two years. As of 1993, generous leaves had convinced 98 percent of female employees to return to the company after a maternity leave.

In addition, People Care Days provide paid time off to tend to personal matters that can’t be scheduled outside of work hours, and a tuition refund plan ensures employees can access higher education with no cost to them.

On a community level, BMO encourages long-term employee volunteerism by providing a day of vacation for every vacation day an employee uses in a community activity. Making It Possible, introduced in 1995, makes financial contributions to charities or community agencies where employees volunteer. Grants range from $250 to $1,500 for each employee per fiscal year and can be earmarked for a specific project or for general operating expenses. In the past, grants have supplied food for Meals on Wheels, enabled a seniors’ home to promote its musical events, helped a group of kids enter a hockey tournament, provided special equipment for people with cerebral palsy and allowed a scout troop’s meeting place to become wheelchair accessible.

Managing change: Never stop learning.
It isn’t every day a company puts $50 million where its mouth is. In 1994, BMO swung wide the doors of its Institute For Learning (IFL), a shiny, futuristic behemoth of a building dedicated to one thing: changing the culture of Canada’s oldest bank. Four years in creation, two years in research and design and 18 months in construction, the building offers 150 rooms for residential learning. It also packs in 12 technology-strewn classrooms, a high-tech resource center, break-out rooms and eight role-play rooms replete with the latest audio-visual equipment. Light shoots in from windows and skylights. A dorm-style lunch room encourages interaction. And a wellness center offers residents recreation from swimming to weight training.

Why construct a monument to education? Part of the reason was the external atmosphere of the banking world. In 1989, the Canadian Bank Act, which limited banks solely to traditional banking, was thrown overboard. Banks were suddenly allowed to venture into deeper waters. They could form trust companies, manage mutual funds, broker stocks and offer life insurance. Overnight, the formerly rigid definition of BMO’s competitors exploded, as did its potential customer base. International mergers added to the competition, spawning a new breed of superbanks.

Chairman and CEO Matthew W. Barrett was the second reason. Barrett, a man who chooses books over sleep (he says he reads about 100 a year) embodies the very definition of a lifelong learner. “He basically considers the bank a school,” says Stairs. “If he were reading an accounting book and got stuck, he’d go to the accounting department and find someone who’s knowledgeable to become his teacher.”

As an adult, Barrett carries with him the reminder of his musician father, whose Irish craft was rendered useless by changes in musical tastes. The experience left Barrett with an obsession to stay ahead of the pack. That’s just what the Institute for Learning would do, BMO execs believed—help transform the workforce from order takers to innovative, creative, energetic idea people who could work with customers, not just for them.

To achieve that goal, the Institute’s staff members, once simply order takers for training, upped their acumen and divided into three main functions. Relationship managers act as client liaisons in the line of business they support. They work directly with each business area to establish that area’s learning opportunities. “They start with a performance analysis,” says Jim Rush, executive director of the IFL, located in Scarborough, Ontario. “They look at the gap between ideal performance and current performance and decide where learning might close that gap.” A group of faculty become experts on subject matter in one of three categories: leadership and change, technology and change and core banking skills. Finally, learning managers address how learning will occur. They decide the best forums for learning and the environment in which learning will take place. “We’re all about being as deep as we can be in the business,” says Rush. “We know the business almost as well as the business head, so we can offer them things that will really move them forward.”

The base commitment tied to the Learning Institute was to provide five days of education for each employee at the bank by 1997. The Institute achieved that goal by the end of 1995, ranking its training hours at about three times the national average. It’s a commitment that cost the bank $62 million in 1996. Surprisingly, only 28 percent of training actually occurs at the Institute. The rest occurs at or near each employee’s work site or through distance learning. An online help program helps employees who need a refresher on training, and an electronic classroom, in which students learn, communicate and receive assignments online, is flourishing. Don Blake, senior technical analyst for the Center for Education Technology in Washington, D.C., says this is a sign of BMO’s training astuteness. “Distance learning is an extremely useful education tool,” he says. “[Companies] that use it are ahead of the game.”

With continuing nips and tucks, BMO’s training cost has lowered, from a $415 average cost of training per day per employee in 1993 to a $290 average in 1997. The 100-person faculty also is tracking the effectiveness of their training. Faculty wait until the employees have been back in the workforce three to six months so they can see if the training has taken hold and is useful. In 1997, 80 percent of employees said that the programs had a positive impact on their quality of work and work environment.

Another proof of progress is Learning for Success, which helps employees upgrade their skills from transactional to relationship building. For instance, tellers are learning to become customer-service reps and financial-services managers—a crucial program since teller positions will soon be eliminated at BMO. Institute staff discovered that branches whose employees had attended the program received significantly higher customer-satisfaction scores than did branches whose employees had not.

Stairs believes it’s Bank of Montreal’s powerful synergy between HR programs that have helped it achieve record profits for seven years now. “Some companies may think these are all very nice, very soft programs, and we’re spending a fortune, but do they have any effect? Yes. What affects the employees affects the customers, which affects the revenue. There’s a causality.”

From an Institute for Learning to a Possibilities Centre, from training programs for future employees to work options for current ones, and an equal playing ground to boot, BMO does indeed have something for everyone. You could say the company’s HR strategy is something to bank on.

Workforce, December 1997, Vol. 76, No. 12, pp. 30-38.