When the too-big-to-fail CEOs got the boot, I said good riddance. Now if the stockholders dump the "Too-Big Directors," you won't even notice any change because many Directors don't do anything except display their political correctness in the annual report photo (race, gender, for-the-people advocates, Mayflower-type name recognition, academia credentials, government service, etc.). Once a month, they have a nice lunch, collect a fee, nod a lot at whatever the CEO presents, and take a nap during the charts presentation. Where's the governance in Corporate America? Where's the governance in government regulations? Where's the responsibility granted to those with power? It doesn't appear to be in the leadership of very large banks. Stockholders, affiliates, retirees, and yours truly beware. Caveat emptor has never been more relevant in protecting the trusting public.
But on the bright side, you can still find excellence in one sector of the banking industry. It's the bank tech companies. The management teams at FIS, Fiserv, Jack Henry, and Harland Financial Solutions (just to name four because I've known them for 25 years) can write the book about how to manage complex businesses the old fashioned way, with integrity and profits. They are never fired, disgraced, or called before a Congressional hearing. The last three years have been tough ones for bank tech companies, but you'll be hard pressed to find disasters there as in the case of their customers.
The main thing I have noticed about current bank tech managements is there is not one supreme being or prima donna among them. The CEOs of these companies have real bosses (aka Directors who direct); they are members of a team; they respect their owners and spend their money wisely; they don't hide anything from anyone. Most importantly, they have humility, responsibility and equal parts of modesty blended with chutzpah. Where did they get that? From the ground up. Only one was hired as a CEO, after earning his "stripes and brass" in a previous executive position. They even belong to an organization (Association for Financial Technology) where meetings are collegial like those of the American Medical Association as opposed to a bunch of competitors taking cheap shots at each other.
It's my business to serve my clients with truth, accuracy and reality. So after 814 scientific tests to determine the correct primary vendor for a particular bank, I spend time getting into matters involving chemistry and culture — What makes these companies tick? There are 39 people in the ranks of management at these four companies, according to Automation in Banking - 2010. I have met 72% of the group. Some I have known for more than 25 years; others only slightly to transact business by e-mail.
I tell all my client CEOs to visit the headquarters of the vendor I recommended. Eat their order-in lunch. If you must, bring your own flask because you won't be served a cocktail. Talk about any subject. Don't try to measure the vendor staff. Let Nature take its course. On your way home, you'll know who your primary vendor will be, and you won't need your Board's approval, or that of a Regulator, or a stockholder vote, or even a nod from a sage consultant. And your customers will adore the post-implementation results. Even if no one rewards you for a job well done, you'll know it because you did your job responsibly and you kept the bank's name out of the press.
This blog would not be complete unless I at least mentioned the good work done by 56,821 other employees of these four companies. I don't know them all, but I know their results, and they are wonderful.