Wausau Financial Systems Inc. plans to announce Monday that it has hired the payments industry veteran Gary Cawthorne as its president.
Cawthorne has been on the Mosinee, Wis., company's board since April 2009. He said that in taking over as president, he will get a more hands-on role in its current projects, focusing on paperless banking, an integrated receivables hub and outsourcing.
Cawthorne was most recently a managing partner at the consulting firm Electronic Knowledge Inc., and has worked at the Dutch technology company Getronics NV. Before that he spent 25 years with Unisys Corp.
"I've had a lot of experience in operationalizing strategy and execution, and that's what I think the board was looking at: not only putting in place the strategy but making sure … that we have the right kind of customer service environment to really make a difference in the marketplace," he said in an interview Friday.
Cawthorne succeeds Joe Delgadillo, who left Wausau in July after five years as its president and chief executive. Wausau did not provide a reason for Delgadillo's departure.
Cawthorne is taking over only as president — the position of CEO is being eliminated — and will share an office with Chairman Bill Fenimore, who has been in that role for 18 months.
"Bill has been very closely engaged at the operational level with Wausau, where I was really a board member, so this is just set up to facilitate the transition," though Fenimore's responsibilities will not change otherwise, Cawthorne said.
Cawthorne talked up Wausau's wholesale lockbox business, which he said has capabilities that most rivals do not offer. "We have distributed remote capture on a national basis," he said, and whereas most processing is tied to a post office location, "we're not. We have a distributed capability … and we're really going to expand this business."
Cawthorne said Wausau's approach is to find specific areas where it can change the way things are typically done at a bank and provide new value.
"Even though people may be thinking, 'Well payments, that's a declining business,' if you're in the right place, it's not," Cawthorne said.
Another example is the elimination of paper, which Wausau's vice president of marketing, Chris Zegal, described as a sizable opportunity even among banks that believe they have already gone paperless.
"Many FI's think they've gone paperless just because they've done branch capture or teller capture," Zegal said, but Wausau also supports paperless loans and new account opening as well as safety deposit and treasury management services. These added services are "extending it from a paperless branch to more of a paperless bank," Zegal said.
Cawthorne said Wausau's integrated receivables hub capability is being enhanced with a matching system that can help make exception management more practical for users.
"The value proposition there is, as you can imagine, some commercial firms that are producing lots and lots and lots of invoices every month … have an army of people doing reconciliation on those bills," Cawthorne said. "There's software available with rules engines that does that automatically, so it would limit the army of people doing receivables reconciliation to a much more manageable and cost-effective solution.
Steve Murphy, a research director for the wholesale banking practice at TowerGroup, said Wausau's approach makes sense.
Particularly with receivables, "their strategy in general will work," he said. "The question is whether they want to extend it and expand it."
Its hub approach is "where the industry is going, which is consolidation of various back-office processes," Murphy said. "Their approach … [is to] bring that all into the electronic world."
Nancy Atkinson, a senior analyst at Aite Group LLC in Boston, said Wausau's strategy is typically to tie in its offerings "in a new way to offer additional services" to new and existing clients, such as in the paperless banking example Zegal described.
Any management shift "has the potential to be disruptive," which could serve as an invitation to competitors to take advantage of any uncertainty it leaves, but Wausau's decision to tap a board member to replace its president could send the message to its clients that there will not be much disruption in the company's operations, she said.
"They're bringing in someone who has been on their board and probably has been supportive of their strategy … [and] who has had some experience with the company," Atkinson said.
That said, it is still unclear how Cawthorne's management style will differ from Delgadillo's, and what this means for Wausau.
"We're going to need to watch them for a few months and see just how significantly" this management shift changes — or maintains — Wausau's business plans, Atkinson said.
