Your boss can’t hear you
I had a meeting recently with someone who’s a seasoned businessperson with multiple successful exits but new to fintech.
The reality is your CEO is mostly talking to risk and finance. And arguably, that is as it should be.
Welcome, buddy. We have cookies.
He had just invested in a tech stack and was effervescent with excitement about the art of the possible here and wanted to talk to me about it. The conversation was really interesting. It went from the abstract (do heuristics matter as much as we think they do when formulating investment theses or do they create self-fulfilling prophecies where people bend their stories to fit your buzzwords?) to the very specific (API messaging standards and the glory of ISO 20022). It was a good conversation.
For me.
I don’t think it was as much fun for him.
Because, the thing is, he doesn’t come from our industry… so he really was taken aback by a flippant comment I made which took us down a dark rabbit hole to the thing those of us who have done time inside the industry all know is our Achilles heel. I say we all know… Only he didn’t.
His view, you see, was that this tech stack (and others like it… he didn’t feel he had something unique but rather something differentiating… he was not naïve) combined with the way the market is going… combined with the prevailing regulatory winds… meant it was something every bank and FSI in the world needed – ergo, the TAM was huge and the moment was now. Because of course people may not buy a nice to have but they will invest in what they need.
Ah.
Well…
Yes to the TAM. Sort of yes to the moment in time. Only the moment has been now for a while. And here we are.
“What do you mean?” he asked.
Oh, buddy.
“Settle in. You will enjoy this,” I said.
So we chatted. About how decision-making in big organisations works. How systemic imperatives come down to risk management and self-preservation.
How big change comes only if A) a big client demands it, B) the regulator demands it, or C) an individual is building towards a personal legacy (i.e. it’s their last job, they don’t care, do your worst) or a career accelerant that will get them to the next level or next job (which usually means they will start this thing but may not be around to finish it because… promotion).
“That’s it?” he said.
That’s it.
There are permutations and colours and flavours, but yeah, largely that’s it.
His face was screaming ‘this can’t be right’ and ‘this is madness’, but all he said was… “How do we change that?”
I told you I liked him.
But here is the thing.
Speak to a DPO or MLRO about how much time they get with their CEO.
About whether they can get their CEO to focus on what they are saying (unless there’s a breach or an incident and then the focus is relentless and the conversation heated until remediation is in place and then we are back to not being able to get the CEO to listen).
And why is that?
If you ask the MLRO… it’s because the CEO is focusing on the strategic shiny stuff.
But if you ask the tech, data, innovation or whatever the team that does the shiny stuff is called these days, they will tell you the CEO is not really talking to them either. That they struggle to get attention and headspace too.
They assume the CEO is talking to Important People.
The reality is the CEO is mostly talking to risk and finance. Who are important, of course, but not the way you were thinking.
Clients and regulators too, of course. But mostly, in a big organisation, the CEO spends a whole bunch of time firefighting… a lot of time kissing babies, so to speak, but the vast majority of their time is spent with permutations of risk and finance.
And arguably, that is as it should be.
Only, the way we have historically thought about risk and finance in this industry is backwards looking. We have lagging indicators and static reports even though we have the ability for dynamic MI and a different set of questions.
So what can we do to get the CEO to have the conversation about the transformative capabilities of new tech? We can articulate it as an exercise in risk management. Because actually, that is exactly what it is: both the decision to change and the process to get there.
What can we do to get the CEO to give headspace to the privacy, KYC, AML space? The ‘scary things can happen here’ space? We tie it to the way we realise our financial plan and stay within risk appetite. Because, you got it, that is exactly what it is. The things we can do better and proactively to ensure good things happen and bad things don’t. And then we hit our numbers and there are cookies.
The world is changing. The investors know it. The techies know it. The teams inside your organisation know it. Your MLRO knows it.
And to be fair… your CEO knows it too.
But they are on a treadmill that doesn’t allow them time to think and doesn’t ask them the questions that you want answered. And you can’t change that.
But they can. The CEO can change that.
They can change it by turning to the risk and finance functions and saying “I will continue spending the vast majority of my time with you” because actually that is the job. But I expect you to change the way you spend the vast majority of your time preparing for these meetings. I expect you to start asking me different questions and arming me with the data to answer them.
#LedaWrites
Leda Glyptis is FinTech Futures’ resident thought provocateur – she leads, writes on, lives and breathes transformation and digital disruption.
She is a recovering banker, lapsed academic and long-term resident of the banking ecosystem.
Leda is also a published author – her first book, Bankers Like Us: Dispatches from an Industry in Transition, is available to order here.
All opinions are her own. You can’t have them – but you are welcome to debate and comment!
Follow Leda on X @LedaGlyptis and LinkedIn.
