by Jeff Rendel, Certified Speaking Professional
Peer-to-peer lending. Alternative depositories, lenders, and currencies. Digital delivery and wearable technology with payments apps. All cases of tangible, existing, and disruptive influences to your bank’s business model. Disruption is here to stay, and it always has been (remember the arrival of money market accounts, variable-rate mortgages, and that unfeeling, faceless ATM?).
Bank directors and executives realize that disruption and change is relentless. While the business model of deposits and loans can provide profits, directors and executives also recognize that fine-tuning for the future parallels remaining relevant for today. It requires an appetite for disruption. To lead their strategic adaptations, banks need to be their own agents of change and forces of disruption.
Getting your Board on board behind new strategies and ways of serving your customers requires the Chair and CEO to demonstrate the value of new ideas and how they improve more than just financial objectives; they improve a range of growth and relevancy objectives. Here are four ways to gain buy-in for your bank’s do-it-yourself commitment to disruption.
- Be a sounding Board. As directors, you want what’s best for your customers; it’s a must for an evolving bank. With your CEO, craft a boardroom dynamic that is aligned with your vision, yet receptive to disruption. Ask your CEO to frequently update, discuss, and introduce new ideas that add value to your bank. As a board, convey your support to your CEO through your readiness to listen to and provide fresh ideas, lend assurance to current and new directions, and give disruptive concepts a tailwind of backing for outstanding execution.
- Uphold a spirit of experimentation. One CEO described his board’s support of disruption and intentional change as, “…self-administered inoculation. We’re used to it now.” Promote the notion of constantly experimenting with new ideas and making small changes along the way. Get to know managers and executives who act as internal change agents. Your board benefits as it understands practical change from the experiences of those working daily on your bank’s future.
- Look outside the bank. Consumer trends and expectations tell a story, regardless of industry. Technological advances reach beyond Silicon Valley. What are these changes, how do they affect your bank, and what do your customers expect? Your bank has the opportunity to match your delivery with forward-thinking products, services, and experiences. Your board’s awareness of consumer changes gives it an appreciation for agility, allowing your bank to meet disruption with a plan for action.
- Know the numbers and the stories. Disruption leads to change and change is monitored to gauge success. Your board’s fiduciary responsibility requires that it balance risk with reward, all with an eye toward safety and soundness. As your board reviews the quantitative and financial data of operations and major initiatives, don’t overlook the qualitative and first-hand evidence that tells the stories of your customers’ successes with your disruptive changes on their behalves. Your board witnesses success in the financial statements, but also in the lives of the customers and owners it represents.
The business of your bank is completely different than it was ten years ago. And, ten years from now, it will entirely change again. Disruption has a permanent place in your bank. An appetite for disruption has a permanent place in your board room. Serve your customers well today by creating the bank they will expect tomorrow.
© 2015 by Jeff Rendel. All rights reserved.
Jeff Rendel, Certified Speaking Professional, and President of Rising Above Enterprises works with banks that want entrepreneurial results in leadership, sales, and strategy. Each year, he addresses and facilitates for more than 100 banks and their business partners.www.jeffrendel.com