Have you heard of Arthur Chu? Perhaps you know him better by his nickname, The Jeopardy Jerk. Debating Chu as hero or villain is currently trending on news outlets and social media. He “hacked” the Jeopardy! game show with a unique strategy of bouncing from category to category, using no apparent process logic. It keeps his opponents a step behind and uncovers coveted Daily Doubles.
Judge as you will. To date, Chu has amassed $261,000 over the course of nine matches, and he isn’t finished yet. One reporter noted, “The game was never close.” What is certain is that the game will never be the same.
Chu has broken no rules; he just saw a different (perhaps smarter) way to stay ahead of the competition. This is a strategy that any of the other players could have adopted. They just didn’t. It’s not the way the game traditionally has been played.
There might just be a lesson here for bankers. In an already heavily restricted industry, rules and regulations are increasing at an alarming rate. Growth is a challenge and competition for quality loans is fierce. And increasing non-interest income while battling a rise in non-interest expenses from the litany of new rules often seems like a losing battle.
If just keeping up with the game is a challenge, how do you win?
Two words. Vision and courage. Vision to broaden your perspective beyond tradition, and courage to challenge the age-old, orderly way of doing business. Nowhere is this approach more applicable than with regard to how banks compose their executive leadership and boards of directors.
Recent research from McKinsey & Company, Thomas Reuters and PEW Research Center highlight a few good reasons why you might want to consider this “hack” of the system. Boards with generational, cultural and gender diversity produce an ROE more than 50% higher than those with homogenous board composition. And take into account that as Baby Boomers begin to transfer their wealth, they are putting it in the hands of a generation with notably different financial priorities. If you need another reason, consider that women are rapidly matching men in high-skill, high-pay positions and in wage parity.
Bottom line, if a board focuses on diversity, management will focus on diversity, and the increasingly diverse customer base will be represented, heard, served, and attracted. As is the case with Chu, this strategy is not proprietary. But it is still somewhat underutilized, and it may mean the difference between competing and winning.
What does your board look like? Have you stuck to the traditional rules, or have you begun to engage these new profiles in your strategy?
This is Part One of a two-part series examining why and how banks need to reconsider the traditional way of composing their key leadership structure. Subscribe now so you don’t miss the second installment in which we’ll provide demonstrated thought leadership and actionable recommendations for a winning leadership strategy.