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Strategic first steps to control your institution’s destiny

November 5, 2012
Read Time: 0 min

John OliverWhole-system planning is imperative for a financial institution’s strategy development, according to John Oliver, President of Laurel Management Systems, Inc. In Part II of this guest column, Oliver discusses some starting points for effectively implementing whole-system planning in order to take control of your institution’s destiny.

Strategy development to ensure future relevance: Implementation

By John Oliver

Earlier, I discussed the compelling need for financial institutions to put in place effective strategy-development processes that start and finish with market needs. I talked briefly about the concept of whole-system planning being the only proven methodology of achieving practical, measurable strategies that actually impact the marketplace. So what is whole-system planning and how can institutions use it effectively?

Genuine strategy-development involves three key components:

1. Quality research that provides the hard data, opinions and ideas that are at the core of understanding market needs.
2. Involvement of all employees of the institution (it is unrealistic to think that the best ideas can only come from those with hierarchical titles).
3. A willingness to consider change.

A typical top-down planning process starts with the leadership team and rarely results in any constructive change that is recognized by the marketplace. Whole-system, bottom-up strategy development starts at the customer level and continues up through the organization. By the time the leadership team is required to make strategic decisions, they are armed with the information that equips them to design a relevant future for the institution.

Leaders need to be strategic thinkers. But what does that mean? Experts tell us that strategic thinking is one of the most challenging aspects of a leader’s role. Generally speaking, most of us are pretty good at the day-to-day managing of the enterprise but when it comes to envisaging a future that looks different from today, that’s another story entirely. It takes a variety of complex skills, including:

1. Endlessly questioning the status quo.
2. Looking to other industries to provide examples (and warnings).
3. Accepting short-term pain for long-term relevance.
4. Convincing others of the compelling need to be doing things differently (getting buy-in).

The starting point for any quality strategy-development process is building a thorough understanding of the institution’s existing business model. Who do we serve? What is our competitive stance? What is our marketplace and what opportunities exist? Once this has been achieved it is necessary to hold that business model up to the most severe scrutiny. Is this going to be relevant in the future? Even if the customer of today loves us, will the customer of tomorrow? What external factors could blow us out of the water?

If these difficult questions are faced head on, then – and only then – can an organization begin to craft a successful future. Despite many predictions of our imminent demise I believe the financial institution sector will have a great future. However, future success is unlikely to accrue to the benefit of those who think it will look like our past.


To lean more about how to take control of your institution’s destiny and ensure effective whole-system planning, download this free whitepaper: Bank Examinations: Balancing CAMELS Ratings

John Oliver has worked in the financial services sector for over forty years. Laurel Management Systems, Inc., which is based in Southern California, specializes in strategy-development process implementation for community banks and credit unions. He can be reached at [email protected].

About the Author


Raleigh, N.C.-based Sageworks, a leading provider of lending, credit risk, and portfolio risk software that enables banks and credit unions to efficiently grow and improve the borrower experience, was founded in 1998. Using its platform, Sageworks analyzed over 11.5 million loans, aggregated the corresponding loan data, and created the largest

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