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When Your Accountability Exceeds Your Authority, Increase Your Influence

April 4, 2012 by JP Nicols

When I graduated from college and entered the workforce, I received some good advice from an older executive: “Make sure you don’t end up in a job where you have accountability without authority“, he told me. I nodded sagely as I drunk it in.

I even repeated the advice from time to time to other friends as they interviewed for jobs.

It took me quite a while to understand that as well intentioned as it was, it wasn’t always possible to follow.

It’s actually great advice to keep in mind in your discussions when you’re receiving a new job or a new assignment. You should ask questions to understand how your success will be measured and what the limits are for your authority. Can you replace team members if they don’t perform? Will you have a budget to acquire needed resources? What decisions can you make independently, and which ones do you need to defer to someone more senior?

But ultimately, every job has accountabilities that exceed its authority.

There will always be resources you don’t own, people who report to someone else and circumstances beyond your control potentially standing in the way of your success. Even your CEO can’t control the analysts who opine on your stock, your regulators, your customers, your competitors, or the economy; no matter how important any of those might be to your company’s success.

So what can you do?

Influence.

The best you can do is influence those around you.

Steven Covey talked about the circle of concern and the circle of influence in his book The Seven Habits of Highly Effective People . Your circle of concern can be vast– the economy, existing competitors, the threat of new entrants, your family members’ health, peace in the Middle East. And your circle of control is always smaller than you want it to be. Spend your energy trying to expand your circle of influence, rather than trying to expand your circle of control.

Your formal “authority” is limited to your circle of control. Your “accountability” is your circle of concern. If you’re a financial advisor with the accountability to grow revenue on your book of business by 10% this year, it would be easy to be overwhelmed by the the huge gulf between the relatively few things you can control and the huge amount of things that concern you.

Focus on increasing your influence…

…on your cients.

…on your co-workers.

…on your boss.

…on the world around you.

“The greatest ability in business is to get along with others

and to influence their actions.”

–John Hancock

Filed Under: Leadership, Practice Management, Wealth Management Advice Tagged With: Accountability, Authority, Financial adviser, influence, leadership, Seven Habits of Highly Effective People, Stephen Covey, Steven Covey

Best of Bank Innovation 2012- Part 2

April 3, 2012 by JP Nicols

Yesterday I brought to you some of the best thoughts from Day One of the Bank Innovation conference held last week in San Francisco.  It was a great event filled with some of the sharpest minds in financial innovation. Today, I bring you  some of the best ideas from Day Two, plus a few of my closing thoughts.JJatBI2012

Channel Agnosticism: Being Everything to Every Customer

“Multi-channel strategy is solving issues that exist in a single channel world…Think full service vs. self service, not traditional vs. alternative (channels)”

—Ginger Schmeltzer, SVP, Digital Channel Management, SunTrust Banks

“Be the right things to the right people in the right channel…Focus on optimization, not migration…” Think in terms of an analogy to eating:

  • Snacking- wherever, whenever = check your balances, transfers
  • Lunch- diverse, habitual and regular = online banking, bill pay
  • Fine dining- staff assisted =  important and meaningful decisions”

—Geoff Knapp, Vice President, Online Banking & Consumer Insight, Fiserv

“Mobilize and optimize– don’t miniaturize…Continuously evolve the experience as devices change…so many mobile capabilities to leverage– maps, GPS, messaging, speech input, camera, video, etc., etc.”

—Brian Pearce, SVP, Head of Retail Mobile Channel, Internet Services Group at Wells Fargo & Co

My Closing Thoughts

  • There continues to be a tremendous amount of innovation in the payments and transaction space, both from within the banking industry and from disruptive forces outside the industry.
  • Several speakers talked about moving beyond the efficient utility of flawless execution to creating more engaging experiences.
  • There was also increasing talk of creating more consistency in functionality and experiences across multiple channels (web, mobile, apps, mobile web and “real life”)– what Steve Jobs would have called an “ecosystem”.
  • Accordingly, financial institutions are beginning to integrate Big Data into the ecosystem (and vice versa), but most have a long way to go.
  • Most financial institutions are still in the early stages of integrating digital marketing and social media into their overall strategies, and many are still struggling with more basic concerns of sales and revenue growth, talent management and trying to figure out how to take market share from one another.
  • As far as I know, I was the only person in the room with a background in wealth management. I continue to be energized by how much white space there is to explore at the intersection of leadership, advice and technology.
Related articles
  • Where Banking Meets Innovation: Innotribe (bradleyleimer.com)

Filed Under: FinTech, Leadership, Practice Management, Wealth Management Advice Tagged With: Bank Innovation conference, Brian Pearce, financial innovation, Financial services, fintech, Fiserv, San Francisco, Steve Jobs, SunTrust Bank, Wells Fargo

Best Ideas From Bank Innovation 2012- Part 1

April 2, 2012 by JP Nicols

Last week I attended the Bank Innovation 2012 Conference in San Francisco. I met a lot of great people and picked up some new ideas. Here’s what stuck out for me (in a good way):

What Is “Banking” Today?  A Debate on the Future

“We need to marry the online experience to the real world experience– especially for high value transactions, while lower value transactions need to get more efficient.”

—Noah Breslow, Chief Operating Officer, On Deck Capital

“In essence, banking is a utility. Removing pain is a win. You need to give clients a reason to care…The key is to use data to predict what customers want, not dictate it.”

—Shawn Budde, Co-Founder & Chief Risk Officer, ZestCash

“We’ve reached the tipping point on electronic banking, but people need a better reason to go with a direct bank.”

—Dan O’Malley, Founder & CEO, PerkStreet Financial

“We should be trying to build brands that people want to be associated with. They should want to wear our logo because it says something about who they are.”

—Jeff Stephens, Founder, Tribed and CBC

–

New Product Strategies & Possibilities


“We don’t have an ‘innovation department’. All 2500 associates are responsible for innovation.”

—Todd Sandler, Head of Product Strategy & Deposits, ING Direct

“Consumers want a lot of help, and they still look to banks for it. They are moving past transactions and history, and they want help and advice for the future.”

—James Shanahan, President, Shanahan & Associates, LLC

–

Social Banking Without Being Insecure or Annoying

“Companies don’t blog, people do…we replaced logos with faces for our twitter responders and we expanded our 6AM-6PM coverage to 24×7…We pay more attention to sentiment rather than number of followers.”

—Darius Miranda, VP, Social Business Strategist, Wells Fargo

“We actually sat down and wrote 20,000 personalized emails…We got a 40% response rate”

—Josh Reich, CEO, Simple Finance Technology Co. / BankSimple

“You have to think anywhere/anytime and you have to be authentic…You have to connect your brand to employees first. You have to work inside out.”

—Eric Rinebold, Industry Principal — Digital Engagement, Infosys

Coming Up Tomorrow: 

Best Ideas From Bank Innovation 2012- Part 2


Filed Under: FinTech, Leadership, Practice Management, Wealth Management Advice Tagged With: bank innovation, BankSimple, financial innovation, Financial services, fintech, ING Group, Jeff Stephens, Josh Reich, PerkStreet Financial, Shawn Budde, Wells Fargo, ZestCash

Sorry, But You’re No Steve Jobs

April 1, 2012 by JP Nicols

Today is Apple’s 36th anniversary. Appropriately, there was an amusing article in the March 30 Wall Street Journal (Bio as Bible: Managers Imitate Steve Jobs) that described managers who take their admiration of the Apple co-founder beyond inspiration to imitation.

Mindless repetition of another’s actions in hopes of repeating their success may work for a simple task, but not for something as complex and artful as leadership.

Not a new phenomenon

Blatant imitation in the quest for success is hardly a new phenomenon. When I joined the business world in the 1980’s, GE chairman Jack Welch was widely regarded as the prototype for the modern manager. There were a number of factors that contributed to his success, including his contribution to a strong internal culture of developing leaders throughout the company (not to mention the tail wind of a strong economy and stock market during much of his tenure).

But for much of the public and the popular press, he was known simply as “Neutron Jack” in a wry reference to the neutron bomb for his ability to eliminate mass amounts of people while leaving their buildings intact. Welch was not alone. “Corporate raiders” like Carl Icahn, arbitrageur Ivan Boesky, junk bond LBO king Mike Milken and later “Chainsaw” Al Dunlap all grabbed headlines for their particular brands of  cost-cutting to “unlock shareholder value”.

Their ethos was personified in the star of Oliver Stone’s Wall Street– Gordon Gecko, who famously proclaimed that “Greed is good“.

Regardless of the unpleasant (and at times illegal) activities of some, there was a core of truth that many firms and many industries had become bloated with non-productive assets and expenses.

Imitation Without Integration

But other managers blindly imitated these activities, often without  broader context.

Suddenly, managers of every level thought that the key to the corner suite was cost cutting. Never mind that some of those costs were actually investments in their firms’ very future– infrastructure, key activities and key people whose disappearance could prevent paying customers from becoming, well, paying customers any more. Let alone loyal, raving fans.

A unique version of this played itself out in the banking industry too. For sure there were too many competitors with too many expenses to be supported in an efficient market. That’s a big reason why the total number of banks has been cut in half in the past 22 years, as I discussed in my March 26 post Is Bank Merger Mania Imminent?

The New Corporate Buzzwords

But now, the corporate buzzwords that seem to be in favor are some of those favored by Steve Jobs– “innovation”, “ecosystem”, “product focused” and “obsession with perfection”.

Those are all fine traits in the right context, but simply lifting them out of Steve Jobs’s biography and forcing them on your team blindly is not necessarily going to lead your company to become the most valuable in the world.

I recently spent some time with a senior executive who confided to me that her colleague was driving her crazy with his obsessive attention to all the wrong details while major issues have been left unattended. Knowing I can default to sports analogies when trying to make a point, she smiled and said “Let’s put it this way– his team is only scoring two field goals a game, but he’s obsessing over the right shade of color on the uniforms and the selection of halftime music.”

Worse, he had recently read Jobs’s biography and was now using it to justify his unproductively obsessive behaviors.

After all, he was just trying to make the company “insanely great”…

“Sorry, but you’re no Steve Jobs” she wanted to tell him.

Most of us probably aren’t.

Be You Instead

It’s great to pull inspiration from other successful people, but you have to channel that inspiration in a way that is consistent with who you are, and in a way that works for your team.

There was only one Steve Jobs.

Be you instead.

Filed Under: FinTech, Leadership, Practice Management Tagged With: Apple, Carl Icahn, financial advisor, financial innovation, Financial services, Ivan Boesky, Jack Welch, Pioneers, Steve Job

Stop When You Get to Yes!

March 29, 2012 by JP Nicols

That’s classic sales management advice, yet I have seen countless sales professionals ignore it at their peril.

The advice applies outside of sales too, and I just witnessed it yesterday in a whole new context on my flight to San Francisco.

We are all buckled into our (relatively) comfortable exit row seats and the flight attendant had just finished giving us the instructions for operating the doors. As per FAA regulations, she said that she needed to make sure that each and every one of us understood the instructions and that we were ready, willing and able to assist in the event of an emergency, and then she began checking with us one by one.

When she motioned to me in the window seat, I looked her in the eye and said “Yes”, as did the poor guy stuck in the middle seat next to me.  When she turned  to the man seated in the aisle seat, he looked up quizzically and said “Hmm?”.

The flight attendant asked him again if he understood the instructions and if he was ready, willing and able to assist in the event of an emergency.

The passenger replied in a thick accent “Yes. My English is not that bad”.

The flight attendant replied that she was concerned that he might not be able to understand instructions in the chaos of an unlikely emergency and that she was going to have to move him to another seat.

He protested with a few sentences in fluent, if heavily accented, English; trying to assure her that he did understand.

It was too late. the flight attendant had to make a judgment call on the potential safety of passengers, so she moved him.

The guy in the middle seat shrugged and slid over into the now vacated aisle seat, giving both of us the next best thing to first class– reclining exit row seats with an empty middle seat between us.

He knew how to stop when he got to yes.

And I did too.

Filed Under: Leadership, Miscellany, Wealth Management Advice Tagged With: financial advisor, sales management

Preview: Bank Innovation Conference

March 28, 2012 by JP Nicols

Here’s where to find me the next couple of days while I’m at the Bank Innovation conference in San Francisco. I’ll report back next week with implications on the intersection of leadership, advice and technology.

Wednesday, March 28, 2012

Session 1:  What Is “Banking” Today?  A Debate on the Future

  • How can banks realize the dream of “holistic” banking considering legacy challenges
  • What do the most successful start-ups tell us about the future
  • Which conventional wisdoms about the future of banking are wrong
  • How does the branch and ATM fit into the concept of the Future Bank?

Panelists:

Noah Breslow, Chief Operating Officer, On Deck Capital

Shawn Budde, Co-Founder & Chief Risk Officer, ZestCash

Dan O’Malley, Founder & CEO, PerkStreet Financial

Jeff Stephens, Founder, Tribed and CBC

Session 2:  New Product Strategies & Possibilities

  • Where the consumers are, now
  • Innovations worth noting and ones worth ignoring
  • How CFPB and Dodd-Frank realities color product design
  • The future of PFM
  • How should “commerce” integrate with “banking”

Panelists:

Philip Jenkins, Chief Operating Officer, Strands Finance

Rafael Lopes, VP, Sr. Product Manager – International Products & Digital Channels, City National Bank

Iker Marcaide, Founder, Peer Transfer

Todd Sandler, Head of Product Strategy & Deposits, ING Direct

James Shanahan, President, Shanahan & Associates, LLC

Josh S. Turnbull, Managing Consultant, Advisory Services,  Center for Financial Services Innovation

Session 3:  Social Banking Without Being Insecure or Annoying

  • Elements of an effective Twitter strategy
  • The mobile piece explored
  • Is it possible to successfully leverage location apps?
  • How does banking become a part of the social media experience?

Panelists:

Kimarie Matthews, VP of Social, Wells Fargo

Josh Reich, CEO, Simple Finance Technology Co. / BankSimple

Eric Rinebold, Industry Principal — Digital Engagement, Infosys

Thursday, March 29, 2012

Session 4:  Channel Agnosticism: Being Everything to Every Customer

  • Getting more consumers to embrace innovation
  • Usage trends
  • Overcoming the challenge of balancing customer wants and legacy system realities
  • Can branches be maximized?
  • What are the operational challenges that need to be overcome in order to be truly channel agnostic?

Presenters:

Ginger Schmeltzer, SVP, Digital Channel Management, SunTrust Banks

Geoff Knapp, Vice President, Online Banking & Consumer Insight, Fiserv

Julie Milbrand, Vice President, Community Banking, Internet Services Group, Wells Fargo

Session 5:  Separating Digital Wallet & Mobile Payment Fact from Fiction

  • One wallet or multiple wallet platforms? What level of integration can we expect or is necessary?
  • What’s out there now? What’s on the way? Where does NFC fit in?
  • Loyalty, points, rewards and virtual currencies
  • The future of cashless payments

Panelists:

Bill Clark, President, Spindle

Mark Fischer, Chief Executive Officer, Inspire Commerce

Michael Garelik, Financial Services Innovation & Mobile and Alternative Payments Specialist

Omar Seyal, Co-Founder, Tagstand

Eric Remer, CEO, PaySimple

Session 6:  Shop-aholic: Integrating Banking Into a Better Shopping Experience

  • Rewards and banking
  • Payments platform implications for bankers and retailers
  • Where do ATMs fit in?
  • How the digital wallet fosters better retailing?

Panelists:

Marc Caltabiano, VP Marketing & Products, Cartera Commerce

Lewis Gersh, Managing Partner, Metamorphic Ventures

Samir Kothari, Co-Founder, Truaxis

Brian Rigney, VP & GM Business Solutions, CashStar

Session 7: The Organic Online/Offline Twitter Ideastorm

  • During this session, we’ll undertake a good, old-fashioned brainstorm, but using newfangled social media with ideas aired live and via Twitter converging into a dynamic blend of innovation and a glimpse of the future.

Session 8:  App Crazy: Postcards From the Edge of Digital Banking

  • Why certain apps work, and certain apps suck
  • App update by device
  • What’s the next new-new thing?
  • Smartphone vs. tablet vs. both

Presenters:

Eric Connors, SVP of Products, Yodlee

Joe Adams, Managing Principal, Hampton Pryor Consulting

Filed Under: FinTech, Leadership, Miscellany, Practice Management Tagged With: bank innovation, fin tech, financial innovation, Financial services, innovation

Why Should Your Clients Trust You?

March 27, 2012 by JP Nicols

In my March 24 post (Want Client Loyalty? Do Something You Don’t Have To Do) I wrote about trust being the number one driver of client loyalty, and how important it is to put your clients’ needs before your needs and your firm’s needs.

But what is trust and how can you increase it?

My favorite definition of trust is the formula given in the book The Trusted Advisor (David H. Maister, Charles H. Green and Robert M. Galford):

–

(Credibility + Reliability + Intimacy)

__________________________

Self Interest

–

Let’s break that down from the client’s point of view:

Credibility = You know what you’re taking about

Reliability = You do what you said you were going to do

Intimacy = You have taken the time to really understand me

(All divided by)

Self Interest = You give the appearance that you are more interested in what’s in it for you that what’s in it for me

–

Notice how the the elements in the numerator are additive, but even their combined effect are quickly diminished by the single element in the denominator.

–

Think of the stereotypical sleazy used car salesman in the loud plaid sport coat:

Even if he knows every feature and benefit of every model on the lot and is a 10 out of 10 on credibility…

Even if he followed up on every question and returned all of your calls promptly and is a 10 out of 10 on reliability…

Even if he asked great questions about what you were looking for, who would be the primary drivers and how much you wanted to spend, so you’d have to give him a 10 out of 10 on intimacy…

…You just couldn’t shake the feeling that he had x-ray vision that saw through you directly to your wallet. Unfortunately, he’s also 10 out of 10 on self interest.

Let’s do the math:

–

(10 + 10 + 10)

             __________    =  3

10

–

A final trust score of 3 out 10 is a far cry from being a trusted advisor. Even though our salesman was best in class in three out of four factors, it hardly matters if his customers feel like they can’t trust him.

–

So…

Even if you know everything there is to know about the economy, the investment markets and every nuance of financial and estate planning…

Even if you have flawless execution in transactions, reporting and follow-up…

Even if you have assiduously documented every personal and financial fact and nuance about your clients in your comprehensive CRM system…

…you will not have long-term success if your clients don’t feel like they can trust you.

–

Why should your clients trust you?

Filed Under: Leadership, Practice Management, Wealth Management Advice Tagged With: Credibility, Customer relationship management, David H. Maister, Financial services, Trust, trusted advisor

Is Bank Merger Mania Imminent?

March 26, 2012 by JP Nicols

The results of the Federal Reserve’s recent Comprehensive Capital Analysis and Review (CCAR) stress tests have increased the long running speculation that another round of rampant bank mergers may by just around the corner. The number of banks in the U.S. is about half of what it was in 1990, and I don’t see anything changing that trend line.

The most recent spate of bank failures peaked in 2010 with 157, and despite all the headlines, this was significantly lower than the prior peak of 281 failures in 1990. But the primary driver of consolidation in the industry over time has actually been mergers, not failures. Merger activity increased every year from 1992 to 1995, peaking at 606 that year. During that run-up, the number of mergers ranged from 3.7% to 6.1% of the total number of banks.

In 2011 there were only 167 mergers, equal to only 2.8% of the total number of banks, so it would appear that there is plenty of room for additional consolidation. Stubbornly difficult rates of unemployment, housing prices and loan demand make it challenging to achieve decent ROE growth, and the stronger banks have significant advantages over the weaker ones.

Worse, all of those banks competing (all too often on price alone) for a larger share of a slow growing market will likely cause further margin erosions. And again, the stronger banks are better positioned to withstand these pressures too.

Serge Millman of Optirate recently noted that banks are battling with 27 competitors in a typical market, and that 66% of all deposits are held by banks competing in regions with 50 or more competitors!

Since 1990 there have been an average 6.5 mergers for every failure, more than triple the 2011 rate of 1.8 to 1, and the peak of the last cycle was a whopping 598 to 1 in 1997.

Throw in the hassle and expenses of complying with the hundreds of new rules coming out of Dodd-Frank (most of which are nowhere near finalized), and it isn’t hard to imagine many bank directors deciding to sell in the not-too-distant future.

Filed Under: Leadership, Miscellany Tagged With: Bank, bank consolidation, Bank failure, bank mergers, banking industry, Competition, Dodd–Frank Wall Street Reform and Consumer Protection Act, Federal Reserve System, Mergers and acquisitions, Optirate, Serge Millman

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