Bankers, Be Wary of Outdated Stereotypes
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I find myself encouraged whenever I spend time with groups of bankers. The fact that this statement sounds like the set-up to a late-night comedy joke is one of my biggest frustrations.
It's heartening that the bankers I meet almost always defy persistent stereotypes about what the industry is and the types of people who populate it. Standing in an exhibit hall or large meeting room, I would defy an outsider to look around the room and guess the industry by the folks you see in the audience.
The demographic diversity in these rooms rivals trendier industries. This holds true in my onsite visits to hundreds of banks and credit unions across the country. Banking isn't the "exclusive old guys' country club" that many folks still consider it to be.
And yet bankers seem as bad as anyone else about buying into inaccurate and unfair stereotypes. I've long kidded with buddies that I can't imagine there's another industry so enamored by gurus, experts, and futurists who tell it how ignorant and/or incompetent it is.
Don't get me wrong. It is absolutely healthy to listen to criticism. One of the biggest dangers in any business is convincing yourself that you've got everything figured out and that the strategies and practices that made you successful in the past are all you need for the future.
But I'm growing a little weary of bankers so easily buying into the idea that folks from outside their industry know their businesses, their markets, and their customers better than they do. There is a difference between recognizing that new technologies will transform banking and believing that banking will simply become those technologies.
For example, few would question the idea that bank customers of the future will make far fewer branch visits than they did even several years ago. But I would argue that this doesn't make each branch experience any less important. If anything, it makes them more so.
The roles of branches and front-line bankers are evolving from a focus on transactions to a focus on problem resolution and consultation. And as the physical size of our branches shrinks, the responsibilities of individual bankers expand.
Some observers point out that advances in technology have rendered many companies and even entire industries obsolete. But it's pretty easy to cluck one's tongue years or decades later, with full knowledge of the speed of technological, demographic and cultural change, and declare the demise of those industries inevitable. Those who warn bankers about the threat posed by Silicon Valley certainly have a valid point about business evolution. But they're not exactly Nostradamus.
I agree that the history of business is littered with once-strong companies that hung onto failing business models too long. But I disagree with the predictions that similar fates await most banks.
On the contrary, I believe that banks have become remarkably experimental and open to adjusting their business models, especially for such an engrained and established industry. It's misguided to suggest that bankers have their heads in the sand about industry evolution.
Just because bankers point out that branches will likely continue to have a place in the center of the banking universe doesn't make them "technology deniers."
After all, bankers may be a bit more in touch with their customers' actual behaviors and preferences than some of the more vocal outsiders. It's not banks' desire to deny change or somehow put off the inevitable that has kept the levels of branches remarkably stable. Customer needs and demands have kept them open.
Many branches will close. And many new ones will open, some in places and spaces once thought infeasible.
Technology is reducing banks' need for the space that was once reserved for transactional capacity. But it is also allowing banks to design and redesign facilities better positioned to engage and serve customers where they work, shop, and play.
There is no denying that our industry is evolving. But there is also no denying that our people and organizations are evolving with it.
Who knows? Even a few self-styled futurists may eventually recognize that fact.