Westpac Institutional Bank: Risk Leadership Team

By Lisa Doig, Director, Corporate Evolution and Andrew Carriline, Chief Risk Officer, Westpac Institutional Bank

The Client's Goal

Andrew Carriline, Chief Risk Officer of Westpac Institutional Bank (WIB) engaged Corporate Evolution in March 2010 to take the Risk Leadership Team on a Team Transformation Journey. The overall objective was to take a siloed team, with good functional skills but considered to be low performing, to a high performing team standard. Andrew's remit was to deliver to the Institutional Bank stakeholders a well articulated risk strategy, and for the team to become sought after as true business partners to the business.

The Program Design

The Results (Review by Client)

1. Impact of coaching and transformation estimated at min $4.5m benefit for $.25m invesment (18 x ROI)
2. Building High Level of Trust and moving to a high performing team
3. Change of focus from team of technical experts to strategic thinking leadership function
4. Moving from experts to influencers and leaders in change
5. Have engage the hearts and mind of the leaders below to step up

Diagnostic: Wake Up Call

The diagnostic survey took many forms: individual, team and organisational baseline measurements. On the individual side, each team member underwent 360 feedback through the Lifestyle Inventory (LSI) survey and their Individual Values Assessment; the team diagnostic consisted of interviews by Corporate Evolution focusing on team strengths/areas for improvement/blind spots as well as a survey by a top management consultancy assessing the Risk function and interviews with its key stakeholders around the level of value creation. On the organisational side, the Risk function was included in two Westpac wide surveys - the Barrett values survey as well as the SPS Engagement Survey.

In all surveys, a similar conclusion surfaced: that this team was not delivering value to the business and were not working together as a team. They were entrenched in siloed behaviour within the function and in their efforts to manage risk, they were inadvertently oppositional to the very business partners they were meant to engage. Risk was a constraint not a facilitator.

 The Chief Risk Officer, Andrew, was also in for some confronting feedback. When he got back his LSI - he was surprised to be described as displaying very aggressive defensive behaviour as perceived by his team, certainly not the Leader that he aspired to be.

Westpac Institutional Bank Executive Team had begun its own culture and leadership journey with Corporate Evolution. This began his questioning around his own Leadership - where he was and wanted to be. Coupled with the LSI feedback, he took the courageous leap to invest in this High Performance Team program. The management company survey results and demands on the risk function to deliver extensive new capability post the global financial crisis (GFC), across a wider geographic footprint, created the "burning platform".

Phase 1: Aligning the Team

The objective of the first two workshops was to align the team around high performance team fundamentals, defining its:

• Team Purpose 
• Team Vision
• Team Priorities
• Behaviour Shift ("Froms-Tos")
• Values-based Team Charter
• 100 Day Plan

This phase was divided into two different workshops (1 day and 2 days) in order to build up momentum and to deliver tangible goals. 

Critical Success Factor: The turning point in these workshops occurred when the dialogue moved deeper from an IQ to an EQ (emotional intelligence) and MQ (meaning intelligence) level. 

By that we mean the Team Purpose and Vision process connected at a deeper meaning level around why the team members come to work every day ("why, why, why exercise"), what difference they want to make in the lives of others, how to harness their unique strengths and what legacy they want to leave in the Bank. This connection at an EQ/MQ level is what energised and aligned the team and for this to be more than an intellectual exercise.

Risk Team Purpose: To lead a Dynamic risk culture that delights our customers, shareholders and the community.

Phase 2: Commitment to a shift in Personal Leadership Mindsets and Behaviours

With the high performance team fundamentals in place and a Purpose that created the motivation for "why change", the next phase focused on "who do we need to be - and who do I need to be - as Leaders to achieve this vision?" 

Critical Success Factor: This required commitment at a personal level.

Building personal commitment began with conducting the LSI 360 feedback prior to the team members attending the 2-day Personal Leadership workshop. For most of the team, it was confronting to see how their self-assessment compared to their boss's, peers and subordinates' feedback. The 360 feedback is a critical piece as preparation to the 2-day workshop to frame the "why change" and "it's not about them - it starts with me" reality.

 Leadership growth was facilitated with team members on two levels: how to reduce "interference" (our reactive behaviours) and then how to open up our "potential" and purposefully integrate a personal purpose and desired legacy into their daily lives. The two days were designed to create breakthrough at a very personal leadership commitment level.

Phase 3: Accountability towards Team Goals

Often team development programs end there. But the integration of the shift in the business comes after the workshops. Is it for real? Will the Leaders really change? This next phase, therefore was critical and required commitment by the Leader, Andrew, to role-model being courageous, to go outside his comfort-zone and at the same time be openly vulnerable and supportive of his team.

This phase consisted of three components to drive the desired change:

• Tracking progress of actions against the 100 day plan
• Coaching of each leader monthly for 6 months
• Team Observation and feedback from the facilitator on the team dynamic

Critical Success Factor: Setting up and tracking of the 100 Day Plan.

The 100 Day Plan comprised numerous tasks that the team agreed were priorities. Each task had two team members assigned to it. This forced the team members into working with each other, taking risks together and building trust. The Business Manager took accountability for following up the 100 day plan with the team to make sure they completed their tasks. This effort was not to be underestimated. In fact, this effort was vital in delivering demonstrable value to their stakeholders. Mindset shift isn't enough, the team had to deliver on their goals.

Critical Success Factor: 6 Month Coaching

Probably the most important shift in the entire program was with the Leader in one of the early coaching sessions. He was committed at a deep level to shift some old habitual ways of reacting which he could now see were limiting his potential. Call it an "epiphany moment" - but this shift meant the transformation was unstoppable. It was noticed by his team, their subordinates and his peers, the Executive Team members. He chose to let go of needing to control every aspect of the team, which meant the whole system could begin shifting and coalescing towards a more connected, collaborative and constructive environment.

The Risk Team Leadership Team meetings became more productive and efficient. A new Leader joined from another part of the Company and after the first meeting she remarked “This is so different! These WIB Risk Leadership Team meetings are the most constructive meetings of these kind that I attend in the whole organisation” .

Each of the Leaders in the team embraced the coaching; the results were tangible. Some of the feedback included: "We are shifting to a high performance culture, starting to act as a team and there are also quite profound personal changes in a number of the Leadership Team members".

Critical Success Factor: Team Observation

Every month, the Corporate Evolution facilitator observed the team meeting. This was a small activity with a huge pay-off. Feedback to the team on what's working / what's not working, created sustained focus on living the team agreement.

Phase 4: Cascading to next level of Managers and Sustaining the Shift

The final phase was cascading the cultural shift to the next level of risk leaders around the world. This included:

• 1 day workshop x 2
• LSI 360 Feedback + coaching
• Risk Leadership Team Group Session
• 1 day "Leader as Facilitator" workshop for the Leadership Team

This phase was designed for the Leadership Team to start role-modelling the desired culture change in their own teams and to become the facilitators of change with the phased exit of Corporate Evolution.

One Leader remarked, “seeing the shift in culture of the leadership team is now starting to permeate through the rest of the team. It is equipping us to be part of the growth agenda, not a reluctant follower of it."

Summary

Critical Success Factor: Leadership commitment to the program over the long term

This case history was very successful for the client. The overriding critical success factor was that the Leader was committed, at a personal level, to his own transformation as a leader and was committed to this program over the 8 month period. With his shift in mindset, he was fully supportive of the rest of his team to undergo their own journey. His role-modelling made it easier for the team to be willing to be uncomfortable, challenge themselves and because of that, were able to move forward together. At the last workshop, when we asked them to self-assess where they were on the High Performance Team Curve*, they remarked with some surprise and congratulations to each other - "we are a high performance team! - we have the fundamentals in place AND we're committed to each others' growth and success".

Tangible Results

End of Program Survey:

• Return on Investment (ROI): Impact of coaching and transformation estimated at: min $4.5 M benefit for $0.25m investment = (18x Return On Investment)

• My personal leadership development: 87.5% excellent; 12.5% Good
• Team development: 87.5% excellent; 12.5% good
• Tangible outcomes: 62.5% excellent; 37.5% good

Tangible Outcome Comments:

• "The way in which the LT was able to identify a better operating model, resolving potential conflicts through open and honest discussion and then to work as a team in making the new operating model effective"
• "Other business stakeholders are talking about the changes in the WIB Risk team. That in itself is a huge initial measure of success"
• "Having the 100 day plan workplan was critical. We just had no choice but to go forward. No turning back. Now with momentum it's impossible to turn back"
• "I'm getting recognition for my part in driving this cultural shift which is turning into a legacy. That's also a measure of success" 

Stakeholder Survey (from top management consultancy questions):

• Impact that the shift in WIB Risk's behaviours had over the past year? 60% small positive impact; 12% big positive impact; 24% no or negative; 4% n/a
• To what extent has WIB Risk demonstrated a more partnering approach over the past year? 20% high to very high; 60% improving; 20% same as before or less.

SPS Engagement Survey 1 Year on:

Risk: Greatest shift in WIB. 73%-93% across engagement scores. 11 of 15 elements - greater than 5 points better than the benchmark. Ganesh Chandrasekkar, the General Manager HR who has been very supportive of the program remarked in the Executive Summary: "The Risk team stand out as having made improvements across the board. It would appear the culture program has made a significant impact on risk results".

*"The Wisdom of Teams" Katzenbach & Smith