Friday, 18 December 2009

A Huge Cultural Change in the Black Box of banks

I was recently asked to speak at a Banking workshop in Nice that was hosted to address some of the key challenges facing this sector currently. I was fascinated by the depth of feeling that things needed to change, and the ambiguity about what that change should look like. My take away concerns were that, whilst this sector understood the need for change, it should not be change for change sake, or change build upon bad PR and therefore something needs to be done, or change that is force fed to the affected individual. We need to be very conscious and aware of the existing strengths and weaknesses of the current structure, systems and culture before contemplating what change we would like to see.

Organisations develop cultures because they are made up of different types of people and led by people of varying skills and behaviours. The culture of an organisation reflects its beliefs, its values and its purpose. When leaders fail to evolve and align culture with business strategy, the organisation will evolve a culture by default. I suggest that the banking culture is a common theme underpinning bank performance – both good and bad. Not the only one, but certainly one of the least understood by outside observers. Once a culture is formed it becomes hardened like granite, understanding the levers for change and changing it can be a lengthy and difficult proposition. Therefore, creating and sustaining a vibrant and robust culture should be a very deliberate process. Care should be taken when attempting to change a culture, as it can have dramatic impact— detrimental if not carefully planned and facilitated—on the long term viability of the business enterprise.

Culture tends to be something of a challenge in understanding companies. For all of its implied significance, cultural change tends to rate alongside tarot card reading and astrology in terms of leaders willingness or ability to do something about it. They categorise it as a “soft” issue, something they know they need to address and they have a nagging sense all is not well, and in fact inhibits the business.
In fact, culture is not a “soft” issue. Culture can be explicitly defined, and it generally develops out of tangible (and controllable) actions within a company, not in a murky black box.

To have a strong banking system, there has to be a strong banking culture that is creative and regulated where there is accountability and a tie between risk and reward. This seems very obvious now. This means that the best banks will relate risk in the long-term to the rewards they provide in the short-term. They will also build-in claw back terms to any bonuses paid such that if those bonuses blow-up as high profile risk and losses in the future, they get the cash back.

Monday, 14 December 2009

To tweet or not to tweet?

All the schools in the UK will be waking up late, because of X Factor, but Joe was a worthy winner.” So says Ed Balls' tweet this morning.

The scary thing about modern leadership is, when we try to be all things to all people, then we end up putting insane and senseless garbage in our communication in order to prove that we are young, modern, vibrant. I cannot abide leaders or politicians, who, for the sake of a sound-bite, are prepared to prostitute themselves and allow themselves to speak, when they have nothing of value to say, other than I am in charge so therefore the sound of my voice must be heard.

The best leaders are those who understand the power of communication, that the sense of engagement is critical, and ensure that the message is coherent and relevant, with the presentation being timely and delivered with honesty and purpose. Ed Balls rushing to tweet demonstrates his desire to be in the public space, on a technology platform that is hip for him, but he misses the point that noise is not attractive to everyone!!

Friday, 4 December 2009

Come Fly With Me!

As an Irish person, it is an ingrained part of our psyche that we love and admire all things Irish. I was listening to a programme covering the varying virtues of Virgin and British Airways and I was wondering why, whenever the name Ryanair came up, I cringed. Now the respective leaders of these businesses are from very different schools of style. Virgin’s Richard Branson is entrepreneurial and likeable. BA’s Willie Walsh is corporate and slick. Michael O’Leary is aggressive and in your face. The most successful among them is Ryanair’s O’Leary who has built a formidable reputation and a very successful business. My question to myself is why do I not love and admire a true Irish success story?

When you compare the O’Leary business leadership and his defence of his business model, and his outright aggression to all those who dare to question him, you have to ask why his business is so successful , when all his competitors are slashing costs, trying to mimic his model. Could O’Leary be the role model for the new leadership model that we need to build to take businesses forward in the new world we face? Compare O’Leary, aggressive, in your face, does not give a damn about what you think, low cost service advocator, get them on, get them off, do it my way or else, to a Walsh who is corporate, correct, slick, polished, to a Branson, who is likeable, charming, all about the human touch. Which one would you like to work for? Which company would you like to work for?

what we do