Reconn Radio: Podcast #25 – Week of 06/30/14

ReconnRadio

The Survey Issue: Dr. Matt Champagne and some quick thoughts on Interest Rate Risk

Interest rates will change. It’s a given. Don’t panic, though. We have some thoughts to help you cope.

More importantly, we have another fantastic guest on the program. Dr. Matthew Champagne, of Embedded Assessment, will explain the ins and outs of surveys and help you get the feedback that your customers and members so desperately want to give your financial institution. Dr. Champagne has created and implemented innovative customer feedback technologies in hundreds of organizations across every industry. With over twenty-five years in the field of psychology, Dr. Champagne is an expert and pioneer in his field. Listen in as he shares some insight from his new book, “The Survey Playbook”, on this week’s program. “The Survey Playbook” is available here on Amazon.com. You can learn more about The Evaluation Guy at theevaluationguy.com.

 

 

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The Terroir of Regulation

© David Coleman | Dreamstime Stock Photos

© David Coleman | Dreamstime Stock Photos

Frank Keating, President/CEO of the American Bankers Association, reminded us a few days ago that there is too much regulation of the banking industry. You can find a quick blurb from Bloomberg News here. I echo Mr. Keating’s sentiment, but I believe there is another level of deliberation and, indeed, introspection that we need to ascend. Let’s talk wines, and more, for a moment.

Terroir. In my research on this French term, I find many definitions and descriptions, from references to winemaking, which seem to reign superior, to a broader description in Wikipedia - ”‘a sense of place….which is embodied in certain characteristic qualities, the sum of the effects that the local environment has had on the production of the product.” This earthy flavor that some find fancy and provocative while at the same time very comforting, is, I believe, largely missing from the ways in which we conduct business today. We have lost our sense of place, of relationship, and of morality and ethics.  Because of this lack of terroir, we find our industries burdened with more and more regulation. Much like dogs that chase their tails, we chase after riskier types of assets to overcome the fiscal and organizational obstacles raised by regulation. How do we overcome this Groundhog-Day-esque existence?

The ascension out of this regulation is to move forward to an environment where we regulate ourselves and do so without a great deal of outside intervention. Now, many will say that we have done this. It’s not possible, they’ll exclaim. We have tried to police ourselves and it just doesn’t work. It’s under control, they’ll say. Wink, wink, nudge, nudge. I think the debacle of 2008 and 2009 proves otherwise and leaves many wondering when, not if, a similar upheaval will occur again. If we go on believing that any extreme – hyper-regulation to absolute laissez-faire behavior – is the answer, then we all lose. I posit the following for us to consider:

  1. Competition, but not decimation, is healthy.
    • It’s important to have healthy competition, but it is not particularly important to decimate other parties.
    • If we focus on our work, others will fade or be folded into our culture and systems. Our greatest enemy is often our own people, process, and performance.
    • This sense of decimation makes regulators look again and again at how we conduct business.
  2. Commoditization is fallow ground.
    • I’ve often written about how commoditization will lead to consolidation. I still believe that.
    • Commoditization, and to some degree, homogenization, makes it easy to self-regulate. Our similarities in this arena are ripe for picking, cultivating.
  3. Rules, mutually agreed upon, lock out unwanted pests and unneeded temptations.
    • Along with overregulation comes useless lobbying. Self-regulation will eject these unneeded temptations from the battlefield, allowing greater focus on the battle.
    • With sound rules that we created, the pests, ahem, regulators, will just not be needed. I know that is a naive statement, but a guy can dream, right?
  4. Collaboration brings freedom of the land.
    • Working together, as traditional farmers have done for generations, means a more fertile landscape for all.
    • If we set out every morning to shrug our shoulders and cross our arms in the hopes that we’ll win, my guess is that will lead to bigger losses for all. We have regulators because some, both suppliers and consumers, choose to game the system. It’s not about the principle of this party or that party, this political philosophy or that one. It’s about what can I get before you get it. In the infamous words of Danny Devito, playing the role of Larry the Liquidator in Other People’s Money, “whoever has the most when he dies, wins.” I think we are better than that.

So, I did say this was about the terroir of regulation and not the terror of regulation. I don’t think it has to be a terror. I do believe it will take a great deal of time, energy, and humility to find this new place. So, grab a shovel. Let’s get to digging.

Reconn Radio: Podcast #24 – Week of 06/09/14

ReconnRadio

The Pre-Planning Issue: Economic Review, Planning Season Awaits, and Intelligence and Intellect

Are you looking forward to planning season? Are you ready for planning season? Whether you’re an expert or perhaps a little rusty, we’re here to get you started on the right path. Check out our “provisos” on planning. Also, when you embark on your planning adventure, place intellect above intelligence. There is a difference. There is a hierarchy.

 

 

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06/09/14 – Our weekly perspective on the economy

R financial toolsI suppose at some point I’ll be correct. But, you know, that’s not important when it comes to two critical aspects of our lives: the weather and the economy. The real danger with both topics is not being prepared. Also, another danger is just considering the short-term gains, or losses, from the environment, whether natural or man-made. We believe in the “art of the long-view” here.

For the week ending June 6, 2014, the NASDAQ Bank Index, which we provide compliments of SNL Financial, gained more ground, surging nearly 100 points during the week. Bank stocks appear to have found their mojo. The Dow Jones Industrial Average also continued its race to the top, adding nearly 210 points for the week, closing at 16,924.28. That represents another record week for the Dow.

The calendar is packed this week with other interesting bits of data. Consumer sentiment, jobs, and producer prices are all on the docket. As always, our economic calendar is provided by Marketwatch.com and can be found here.

Plan. If only you had one, right?

dreamstimefree_251887Mice. Men. Plans.

They’re ubiquitous. Plans remain the balm for many looking to sit back, survey the landscape, and determine that something must be done. Getting the right plan, which gives life to your philosophy, is largely a distinctly artistic endeavor. That’s right. Artistic. Well, there are tools – brushes, colors, and a canvas. However, I think we are obsessed with coloring inside the lines. Regulators, boards, and management teams compel themselves to go long on form and short on free thinking and experimentation.

If you had a plan, what might it look like? What might it feel like? What story would it tell about you and your organization? I’ll bring the colored pencils and you bring the paper and let’s see what we can draw.