The Summer I Rediscovered Baseball – And, Bankers Took a Fresh Look at Wealth Management
For some reason, I found a vastly renewed interest in our national pastime this summer. It could be, my team, the Washington Nationals are winning and winning big. That simple fact surely doesn’t hurt matters, but in a moment of repose, it’s not solely what is fueling my increased interest in the sport. Perhaps political theater has grown old, or talking of the economy and Europe has staled; or maybe it is a part of a midlife crisis, yearning for the days of a simpler past. Most likely it ‘s these conscious factors coupled with those hard to put your finger on-it gut feelings that brought me back to the game in a big way.
Baseball has deep roots, its own set of rules and its own way of keeping score. There are runs, not points or goals, and, unlike most sports, there is no time limit or clock. There are over 160 games in the regular season, compared to American football with 16.
So, what does this have to do with wealth management at banks?
It seems to me one of the biggest failures banks have with wealth management is recognizing and addressing the cultural divides between banking, brokerage, insurance and trust. While they each have something in common – dealing with money, that’s where the similarity stops. Yes, tennis, golf, lacrosse, football and soccer are all sports, but the rules, skills, equipment, pay and arenas are all quite different.
And while there are cultural divides in traditional banking between retail and commercial, that is more akin to the difference between ice hockey and field hockey, than hockey and baseball.
Wealth management is simply a different sport. Expecting the players to dismiss years of training and countless hours of learning the many subtle but important nuances of the game is both impractical and suboptimal.
Yet, we have seen many banks adopt this very attitude. I had a conversation just yesterday regarding putting caps on compensation plans because the advisors are earning more money than the bankers. As Yogi Berra said, “It’s déjà vu all over again.”
My advice is if you want to own a baseball team, let ‘em play baseball. To try to convert them into hockey players is a fool’s errand.
While the profit dynamics of owning a football team, a hockey team and a baseball team have some similarities; ultimately they are quite different too.
As an owner, you have the right, and obligation to make money. If you don’t the franchise may ultimately be displaced. Yet, to expect the methods, margins and contributions of all sports to be similar, will likely lead to faulty expectations and disappointment.
As a player, accept there is a difference between the American and National Leagues. So too, is there a difference between working in a bank, credit union, independent shop or a wirehouse. Each team has different coaching, different strategies, and different approaches to the game. You don’t have to like it, but remember, “there’s no crying in baseball”. The good news is you can put yourself on waivers at any time; and, the better your performance and attitude, the more likely you will be picked up quickly. So spend less time complaining and trying to change the system and more time hustling and performing.
Occasionally, I will watch some sport for which I have no idea of the rules. While I am often impressed with the athleticism of the participants, my interest quickly wanes as I try to follow something that just doesn’t make sense.
Simply put, most games are more fun if you know the rules and it is incumbent upon the players, owners and management, to know them. It appears this may be the season bankers discover/rediscover the wealth management game. Underperforming/non-performing assets, coupled with stifling regulation and a squeeze on revenue, has knocked bank attendance to an all time low, making those rascally baseball players worth a new look. To win, they are going to have to know, and play, by the rules.
Bankers need to know what it is like waking up on the first day of the year wondering whether you are going to make $40,000 or $140,000 and how the markets are going to wreak havoc on you and your clients’ lives. After all, those are the rules. For their part, advisors should understand what it’s like to take a loan to committee for approval or workout an at-risk asset (or, have a 210 pound toothless madman getting ready to check you along the boards).
It takes pros to succeed in both games. Fostering a culture of mutual respect (versus one of tolerance or contempt) is clearly a winning strategy. I don’t know whether it is harder to hurl a little round ball 60’6″ at close to 100 miles an hour or launch a three-inch disc into a net while skating 25 miles per hour,but to me both are pretty darn impressive.
So C’mon Man! – Let’s Play Ball!Scridb filter
Date: August 13, 2012