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Miscellany

Best Ideas from the Best of the ABA

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After exploring my inner geek the week before at the Microsoft Research TechFest2012 and the GeekWire Summit, it was time to put the pinstripes back on this past week (figuratively, at least) as I headed to Scottsdale for the American Bankers Association Wealth Management Conference.

There were more suits and ties and fewer jeans (and no North Face or Marmot jackets), and more pads and pens and fewer iPads and utlrathin notebooks, as I might have expected. I didn’t have live Twitter conversations about the carpeting that looked like QR codes; but just like last week, I still found some bright and engaged people trying to navigate turbulent and uncharted waters to engage their customers and grow their business. Here are the highlights:

Best quote:

“Watching the stock market last year was like watching a chicken try to fly.  

Too much ballast and not enough lift.”

–  Dr. David Kelly, Chief Market Strategist, J.P. Morgan Funds

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Back to the Future: 

“Go back 10 years to 2002– the key question was when to get back into technology stocks? No one was asking about REITs, commodities, emerging markets, gold, or any of the things that have outperformed since. U.S. stocks have out-performed BRIC (Russia, Brazil, India and China) for 4 years straight, but no one is interested.”

–Richard Bernstein, founder, CEO and chief investment officer,

Richard Bernstein Advisors, LLC

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Ready and Willing, but Unable?

“Fifty percent of high net worth clients are willing to interact with their advisors via mobile, but only 18% have it available to them.”

 –Eileen VanScoy, Executive Vice President of Product Management, SunGard

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What Drives Client Loyalty? It Depends:

What Drives Loyalty To Advisors:

  1. Trust
  2. Proactive communication (1x/month)
  3. Quality of advice

What Drives Loyalty To Firms:

  1. Quality of advice
  2. Service
  3. Value for money

(Note that clients think advice is a firm’s responsibility- Top driver of loyalty to the firm, third driver of loyalty to the advisor)

–Michael Kostoff, Partner, WISE Gateway LLC,

former Executive Director of the VIP Forum

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What Drives ‘Brand Love’ and Trust?

  • Integrity
  • Intent
  • Capabilities
  • Results

Define the desired service experience, make culture a verb and make sure everyone in the organization understands and lives the desired experience as “The way we serve”:

  • Starbucks- the “third place”, as comfortable as your living room.
  • Ritz Carlton- re-create the home of loving parents.
  • Zappos- “wowful happiness”

–Joseph Michelli, PhD,
Author and Organizational Consultant

Top Ten Geek Week Sneak Peeks – Part 2

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Today: The GeekWire Summit

Startup technology news site GeekWire held its first birthday party on March 7 with the GeekWire Summit. Speakers included former Microsoft Chief Software Engineer and Cocomo co-founder Ray Ozzie, former Swype CEO Mike McSherry, Hulu CTO Richard Tom, T-Mobile CMO Cole Brodman, Rhapsody President Jon Irwin, venture capitalist/serial founder Oren Etzioni and other great technology minds. Nothing was focused on FinTech per se, but nonetheless here are some highlights and potential implications on the intersection of leadership, advice and technology in financial services:

“How do large companies innovate? They buy small companies.”

– Oren Etzioni

  1. On the rise of social collaboration in the enterprise, Ray Ozzie paraphrased Ethan Zuckerman (who also has a lot of interesting things to say about how we tend to interact with people who are most like us, but that’s another post) in describing the “scopes of voice” as public/private/secret/self :“I think when you get into enterprise and business scenarios, there are some organizations where speaking publicly in a public voice is very useful. Professional services firms promote an internal culture where speaking openly and being known as the professional who knows something about something works a lot better than certain manufacturing company, where the internal norms might be different in terms of secrecy and confidentiality.”  There is still lots of opportunity, but also lots of work to do, since only 27% of financial professionals use LinkedIn, and less than 4% use any other social media methods at all.
  2. Do you think that building a massive base of clients/users/followers is in direct conflict with customizing your messages to be relevant individual users or subgroups? Consider that Hulu  has 1.4 BILLION ad impressions per month, but they offer some innovative ways for users to customize their ad content. Ad Selector allows viewers a choice of three ads from one brand or one ad from a selection of three different brands. Ad Swap allows viewers to find ads that are most relevant.
  3. Great discussion on the state of mobile technology. All on the panel had praise for the Windows Phone platform, but noted that they have a long way to go with a 4.4% market share to Android’s 49% and Apple’s 30%. (IMHO, I think that RIM’s enterprise-centric 15% share is the most vulnerable to Windows, and it’s already down 2% in the last three months.) Former Swype CEO Mike McSherry said that Apple’s Siri natural speech style will help improve text entry over time too. This evolution to more natural interfaces and input styles was also noted at Micosoft Research on the prior day.
  4. Startup investor and advisor Hadi Partovi noted that the cost of sequencing the human genome has gone from $1 billion to $1,000, and predicts it is heading to $100. If that can be democratized, how naive are we about “big finance”?
  5. Facebook’s Director of Engineering Jocelyn Goldfein said that the company rolled out the new Timeline with a team the size of a startup. Facebook video chat? One guy. In Seattle. Although, that may be taking the lean approach a bit too far. (As someone retorted on Twitter “That explains a lot.”) Still– how many consultant engagements, project managers and steering committee meetings do we need to make meaningful change in our business?

“It’s not enough to encourage employees to innovate.

You have to protect them from the cost of failure.”

– Jocelyn Goldfein, Facebook

(P.S. – I live tweeted my new startup idea from the conference: Embedded QR codes in public carpeting. Remember, I get a 20% Founders Fee.)

Yesterday: Microsoft Research TechFest 2012

Top Ten Geek Week Sneak Peeks – Part 1

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This week I really got the chance to embrace that inner geek that’s just dying to break out of my pinstripe suit. On Tuesday I had the chance to visit the Microsoft Research TechFest 2012, and celebrate twenty years of Microsoft Research (Shout out to my host Juliane Carlson). Then on Wednesday I attended the GeekWire Summit and got to hear and meet all kinds of interesting people doing all kinds of interesting things. Here are some highlights and potential implications on the intersection of leadership, advice and technology in financial services:

Today: Microsoft Research TechFest2012

“The unanticipated results are often as important as the anticipated ones.”  

– Peter Lee, Microsoft Research

  1. Multilingual text-to-speech (TTS) conversion. The demo was oriented around an American using GPS to navigate around Beijing, but imagine being able to serve non-English speaking clients in situations where multilingual employees might not be available or practical.
  2. Lots of projects involving Big Data, including FetchClimate, a massive mash-up of global historical climatic data made instantly accessible. Easily useful as-is to assist in assessing branch locations, client real estate projects, etc.
  3. Another Big Data project is ChronoZoom, which is a “…dynamic cloud based data visualization tool where educators, researchers and students can easily consume, compare and understand the history of the cosmos, earth, life and humanity. Where they can easily consume rich media sets like: audio, video, text, pdfs, charts, graphs and articles in one place and discover new possibilities.” Imagine a financial markets version of this product with every price and correlation of every financial instrument for the past 80+ years.
  4. IllumiShare is desk lamp with camera that allows people to share physical or digital objects across the internet. Imagine a client who has questions on their trust document (or paper statement from your luddite competitor, because of course your institution has a secure digital document exchange with e-statments…). They could flip this on from the kitchen table of their beach house and you can see it all on your screen, even mark it up or highlight key areas.
  5. Multitouch is still evolving, and the Wearable Multitouch Projector can turn virtually any surface into a touchscreen, including the palm of your own hand. The current prototype looks a little bit like  first generation home camcorders with a shoulder bag processor and a shoulder mounted projector, but it will undoubtedly evolve. No touch is evolving too, building on the Kinect interface, including potential touchless interaction in surgery.

Tomorrow: The GeekWire Summit

Free Advice From a Mentor

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(Note: When I wrote this early in my blog’s history, when I was a senior executive for a Fortune 150 financial services firm. Now with the added perspective of an entrepreneur and consultant, I find the words truer than ever.)

I have mentored dozens of young professionals over the years, and even though each situation is unique, I always end up giving these three pieces of advice. It’s not like I planned it all out, or even wrote it out before now, but here they are:

  1. There is no secret handshake
  2. Focus on getting better, not getting credentials
  3. It all starts with you

There is no secret handshake

The CEO of a venture-backed technology company whom I know well once asked me: “Do you ever get the feeling that when someone comes to you for career advice, what they’re really looking for is the secret handshake?” 

Yes, I have gotten that feeling.

My best mentoring relationships have involved mentees who truly want to improve their performance, learn new skills, take on more responsibility or just learn more about what a potential career path might look like for them.

The best way to ensure that a mentoring relationship with me is short (and not particularly rewarding for either of us) is to mistake it as an opportunity to simply learn the secret handshake.

Do you really think I’ll hire you or connect you with someone merely because you want more money or a better title?

Put some clothes on that naked ambition, you’ll catch a cold.

Focus on getting better, not getting credentials

I often get questions like “Should I get an MBA (or any one of the alphabet soup of certifications in the financial industry: CFA, CFP®, CIMA, CTFA, etc.)?”

My consistent answer to all who ask is that if you want to learn more about that particular area and want to study it deeper, go for it. I’m a big believer of continuous learning, and earlier in my career I worked to get an MBA and put a few initials after my own name.

On the other hand, if you think that simply tacking those initials after your name will open a whole new world for you, you will probably be disappointed.

I still remember a soon-to-be-freshly-minted MBA who wanted to ‘remind’ me that he would have this very important graduate degree by the time of his next performance review, and that he hoped that would qualify him for a promotion.

I ‘reminded’ him that he was still the same person with the same level of performance, so probably not.

It all starts with you

This is kind of a two-for-one. First, I mean that before you start on any exploration of future paths, you need to understand your strengths, your passions, what gives you energy and what saps you dry.

I also mean that the whole process of working with a mentor isn’t a passive activity of absorbing second-hand knowledge through osmosis.

I was very proud and excited when my company asked me a few years ago to participate in the pilot of a program called MentorConnect, kind of an internal match.com to put mentors and mentees together based on specific skills and experiences.

I learned to start by asking mentees to share any relevant standardized test results they may have taken recently (Meyers-Briggs, PDI, StrengthsFinder, DiSC, etc.), and if they didn’t have any, I had them start with StrengthsFinder 2.0. Not only did this help give the mentee and me a logical starting place, it helped to quickly identify those who were only looking for the secret handshake. Those types often would not do the work.

I also recall the bright young assistant who was referred to me by her boss for some career advice a few years ago. She wasn’t sure what she wanted, but she was sure she should be higher in the organization by now. I took her to lunch, and we talked for an hour and a half. I gave her a couple of books to read for our subsequent meetings. I must have followed up three of four times when I ran into her, but she hadn’t quite found the time to even buy the books, let alone read them.

I guess I wasn’t completely surprised when she dropped by a couple of months later to let me know she was quitting the firm.

She was going to work on her MBA.

And no doubt continue her quest for that elusive secret handshake.

Five Leadership Lessons From The Godfather

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Godfather

Today Paramount and Cinemark are celebrating the 40th anniversary of the release of The Godfather with a one day showing of the iconic film in 55 Cinemark XD theaters. The movie is my all-time favorite (with the possible exception of The Godfather II). In honor of the anniversary (which is actually later this month), I offer these five leadership lessons from the film:

You need a wartime Consigliere

When Michael was plotting his revenge against the other families, he announced that he was replacing his own step-brother as trusted advisor: “Tom Hagen is no longer Consigliere. He’s going to be our lawyer in Vegas. That’s no reflection on Tom, it’s just the way I want it.” Then to Tom: “You’re not a wartime Consigliere, Tom. Things could get rough with the move we’re making.”

Loyalty, history and track record are important factors in keeping people on your team, but don’t confuse them with having the right people with the right skills and experiences in the right positions at the right time.

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Just because some businesses might be OK for other people, they may not be right for you

When Don Corleone sits down with Sollozzo, who is seeking financing and political protection in order to expand  his illegal drug business, Don Corleone tells him: “…I must say no to you and let me give you my reasons. It’s true I have a lot of friends in politics, but they wouldn’t be so friendly if they knew my business was drugs instead of gambling, which they consider a harmless vice. But drugs, that’s a dirty business.”

Credit unions buying fintech companies. Fintech companies getting bank charters. Banks and credit unions partnering with fintech companies to create new offerings. None of these are necessarily bad ideas, but expand your offerings because it makes sense strategically, and because you are sure you understand the risks and are sure you can execute.

Don’t do it because it’s an appealing source of new revenue. If you’re simply looking for a new source of revenue, why not sell hamburgers?

 

“Never tell anyone outside the Family what you are thinking again”

After Sollozzo exits the above scene, Don Corleone tells this to his hot-headed oldest son Sonny, after Sonny had asked a question of Sollozzo about his proposal, revealing a potential rift in the family.

In this era of social media communications and 24/7 open-source networking and crowd sourcing, remember to keep some things just within the company. That’s how competitive advantages are created.

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“Leave the gun. Take the cannoli.”

Experienced hit man Clemenza offers this simple advice to Rocco after he kills the traitor Paulie along an abandoned stretch of highway.

The leadership lesson: Know what’s important to keep close and what is expendable. Sometimes it’s time to move on, and sometimes it’s time to hang on. Know the difference.

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Make them an offer they can’t refuse

When the singer Johnny Fontane comes to Don Corelone for help in getting a movie role he covets, he is worried that it is already too late since the movie starts shooting in a week. The Godfather confidently reassures him that he will be able to influence the film’s producer: “I’m gonna make him an offer he won’t refuse.”

The old horse’s head in the bed routine is typically not recommended, but you should understand that dealing in the currency that’s important to the other party is the key to influence. Understanding their true wants and needs and worries. If you can help them achieve what they really want, you may very well make them an offer they can’t refuse.

The Intersection

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The Intersection

Welcome to my blog!

I’m here to explore the intersection of innovation, strategy and leadership to improve financial services.

 

Innovation

I’ve been a fan and early adopter of technology for as long as I can remember, but technology is just a tool. I can barely a wire light switch and I have never written a line of code in my life. When I was in high school, my “Computer Math” class consisted of entering strings of arithmetic into what was essentially a programmable calculator with a paper tape. The only thing I remember from that class was that every string was supposed to start with “To (0): Load”, whatever that meant. That, and the time my friend Jim and I conspired to slow down the smartest guy in the class. We each occupied one of the two available “computers” while I switched the + and x keys and then volunteered my keyboard to our unwitting victim. It took him two days to debug his formula.

Computer classes in college consisted primarily of carefully rubber banding slippery stacks of IBM punch cards lest they get out of order and cause you to spend the night in the computer lab. At least, that’s how it appeared to me. I avoided computer classes like I avoided brussel sprouts. Even though my engineering major roommate was easily able to infect me with lustful desire for an Apple IIe (with pen plotter) or even a Tandy TRS-80, my main technology fix at that time came from synthesizers and audio and lighting equipment.

After college I discovered the IBM PCjr, with MS-DOS 2.0 and SuperCalc on 5 1/4″ floppies. My job at the time required me to do simple but repetitive arithmetic with pen and paper to calculate a payroll budget. The mere fact that my results were being printed in stunning dot matrix grey on green and white tractor-fed 14 7/8″ paper seemed to quadruple my credibility compared to the same numbers on the old handwritten sheets. I was forever hooked on the possibilities of technology to improve jobs and lives, and a lifetime of exploration lay ahead.

Strategy

Most of my professional life has been in the financial services industry, I have seen a lot of fads and trends pursued in the quest for growth and profit. Acquisition binges justified by “the need to diversify” followed by divestitures justified by “the need to focus on our core business”. An increased emphasis on variable advisor pay and commissions to “pay for performance” followed by flatter fee and pay structures to “better align interests” (or sometimes simply to “cut costs”). The optimistic splurges on technology to “revolutionize the client experience” (and/or “increase advisor productivity”) followed by the inevitable crash to the reality of disappointing ROIs. None of these strategies are necessarily misguided, but the key driver has to be advice.

Whether you are a bank teller suggesting that a customer might want to open a savings account to hold some of that excess cash in their checking account, or a superstar CFA portfolio manager recommending the latest structured hedged debt solution to improve alpha and reduce volatility, if the person on the other side of the desk from you doesn’t perceive you to be a trusted source of true advice that will solve their problem or achieve their goal, your personal success will be limited.

In my opinion, one of the leading authorities on the art and science of being a Trusted Advisor is one of the co-authors of the book by that very name, David H. Maister, and it seems like every financial firm I’m familiar with has had their advisors read the book. Not that it’s typically very apparent to their clients.  True Trusted Advisors remain as elusive as four leaf clovers in the vast meadows of financial services. Many advisors remain either salespeople or reactive servicers.

Leadership

Innovation and strategy don’t just happen on their own, they take a leader to make them happen. I am particularly fascinated with the research and writings of Marcus Buckingham who describes himself as dedicated to “…understanding what makes world-class managers tick, bottling it, and sharing it with the world.”  As the co-author of Now, Discover Your Strengths, he helped create StrengthsFinder to help people look deep within to find their unique combination of inherent talents.

(My Top Five:  Strategic | Achiever | Futuristic | Learner | Communication)

I have been lucky to work for, with and around some outstanding leaders (plus a few clunkers), and I’ve learned a lot from each of them. The best leaders know their strengths and leverage them to get outstanding results from themselves and from others, yet they know how to access different styles within themselves to provide the right leadership in the right situations. They harness the power of Strengths-Based Leadership and Situational Leadership. Regardless the industry, regardless the challenge, the need for effective leadership is always a critical ingredient for success.

 

About Me

I consider myself an “embedded entrepreneur” with a day job with a Fortune 150 financial services firm, but everything here is my own work and my own opinion. I have been an individual contributor, a manager and a senior leader, and I have always thought of myself as a serial intrapreneur. I love to build high performance teams to create and execute winning business plans. I’ll do my best to share the best thinking of those whom I feel are making important contributions to the intersection of innovation, strategy and leadership. I invite you to join the conversation.