By Kenny Lau
Having played in and coached numerous sports teams over the years, Arthur Bacci strongly believes in teamwork. As Head of Principal International’s Hong Kong Group, he just can’t underestimate or understate the value of teamwork and a strong culture to the success of any organization.
Teamwork-or strategic collaboration-has been pertinent to the business success of The Principal Financial Group, a 135 year-old institution headquartered in the US Midwestern town of Des Moines, Iowa and established internationally across some 18 countries, with a diverse portfolio of asset management worth more than US$320 billion. In fact, it is a Fortune 500 company, despite a humble beginning in America’s farmland in the late 1870s.
“One of the great things about Principal is our culture,” Bacci said in his remarks at the Human Capital Conference. “We truly believe in collaboration-and it’s been especially helpful as we’ve grown our international business over the last 10 years. It’s now about a quarter of our business.”
“As you go across international boundaries, you have to establish a global mindset. Communication and collaboration with people around the world becomes more important than ever,” he says. “It is the approach we’re taking in how we manage and lead, and what to expect of our leaders.
“It is a coaching culture where as a leader it is not only about getting the job done and managing people but also about helping others become successful,” he adds. “Success-including what they want to achieve-should be defined by the employee, not the leader.”
While business objectives are essential, employees have to be able to feel comfortable that they’re progressing in their career, Bacci believes. “We see the trend of an aging population from our savings business, and as an employer we see the challenge of recruiting and retaining staff in a world that is becoming much more competitive.
“I don’t care what business you’re in or what sports you play, it takes a team to be successful,” he says. “In the traditional Chinese sport of dragon boat racing, you have a drummer who sets the tone and a lot of paddlers who actually have a different responsibility in the front, middle and rear sections, but they have to work together. There is no such thing as an individual effort.”
“Even a professional athlete competing on an individual basis, there is always a coach, a trainer and an equipment person as well as a group of fans and supporters behind the scenes. They are not visible but they are part of the team,” he further says. “There are a lot of people in an organization who don’t get visibility, who aren’t seen by management or the customer, but we would not be successful without them.”
The biggest responsibility of a leader is to mobilize and guide the energy and talent of individuals to act as a group for the pursuit of a common goal, Bacci notes. “Acknowledging everyone’s role in any organization as a part of the team is critical,”he says.“If we can’t do that, then all the individual efforts won’t overcome the lack of teamwork.”
Naturally, employees are all different. “Some will buy into your strategy and culture, and they are with you a hundred percent of the way. Then you have a small group-and hopefully just small-that you will never be able to win over,” he says. “The rest are what I call the potential mutineers. They usually make up the largest portion of your employee base, and they are the ones you would need to convince.”
Partly because of the regulatory requirements in the financial services industry, there are several companies within the Hong Kong group of Principal International, all responsible for distribution of various products. What’s interesting is that employees often identify themselves with their individual company, despite all being part of The Principal Financial Group, Bacci points out.
The process of merging these entities, however, is no easy task. “I thought it was going to be pretty easy, but it really was a little shocking to some employees,” he says. “So, we put together a task force, filled it with people from different parts of the organization and made them work together, and we wanted to re-energize our sales and marketing efforts.”
The initiative was to allow employees to come up with their own ideas and be the owner and customer of the business-what initiatives they would undertake to drive the business forward and what they see as critical to their customer base. It was up to them to decide.
“It can be scary for employees, and it can be scary for management,” Bacci says. “But they really came up with some wonderful ideas, and we were behind the scenes supporting them through mentoring and coaching. We wanted our employees to drive the initiatives and wanted them to understand what was important to the business, what would grow the business, and how they would advocate on behalf of their initiatives.”
The exercise became a window of opportunities for employees to experience other functional responsibilities-be it finance, human resources, operations or communications. “It really opens up their minds quite a bit, and you start to develop future leaders because they now have multifaceted experience and a broader view,” he says. “They need to have the exposure to other parts of an organization as too often we see people in the same track for 15 or 20 years doing the same job.”
“We certainly had business objectives we wanted to achieve, and we definitely gained a lot,” he adds. “What resonated with me the most was that our people got to know their colleagues better. All of a sudden, it became a personal relationship. People would go to lunch together and talk about business or other personal items, and they became much closer as a team.”
A financial institution is ultimately a business of people and about people. It is about delivering outstanding customer service, Bacci stresses. “You can focus on sales and marketing, but it doesn’t do a lot of good if you’re selling and at the back end customers are leaving because it isn’t what they expect. We look at what we sell and what we say as a promise, and if we can’t deliver, then we really aren’t any good.”
Hence, an emphasis on the customer experience continues with a company-wide initiative to bring people together from different entities and departments across international boundaries to think together about the ultimate customer, he points out. “If you are in accounting, you may never have to deal with the end customer, but someone in your organization does.”
“Yes, we have sales, marketing and relationship managers, but they are supported by a team of people behind them, and they have to work together to fulfill the customer’s expectation and our promise to the customer,” he says. “There needs to be a mindset that you have a customer regardless of what role you play or what responsibility you have.”
It is largely strong and effective communication for a collaborative culture, Bacci emphasizes. “I do believe we can have a better outcome because we listen to each other, and we’re relying on our employees to drive our initiatives. I call it ‘ways of the employee,’ as they want to come to work knowing they’re making a difference in someone’s life. You have to be passionate about what you do.”
“Within our group in Hong Kong we have multiple companies for different roles and functions, but what I really want to achieve is the sense of one Principal, one entity working together as we empower employees to make decisions, take initiatives and move forward,” he says. “I fully anticipate there will be errors and mistakes, but they will not be held responsible because that’s my responsibility.”
“Some of the best lessons I’ve ever had in life come from mistakes,” he adds. “We want them to experiment and we want them to be innovative. The only way we can do that is to create an environment of trust and support.”