Looking at the front page of the paper yesterday – we have a Prime Minister that may be ousted in as little as 3 weeks with no B plan for leadership in place, corruption in our Health Service Union, the speaker of the house on sex and corruption charges and next week the government is giving us a budget which will try to make us believe miracles are possible, when they announce their attempts to recover the economy to surplus.
Meanwhile, the Reserve Bank of our ‘lucky country’ has cut the interest rate by 0.50 percentage points in an attempt to stimulate business and consumer spending and reverse the negative business sentiment and falling economic indexes. Bring on interest rate cuts of course – if the banks are going to pass it on to us – but their reaction so far is anything but encouraging.
When NAB came out last Valentine’s day with a campaign urging us to break up with other banks, they gave us the impression they may be prepared to do things differently and to our benefit. But they announced on Wednesday they would pass on a mere 0.32 points to customers instead of the full 0.50 – an immediate ‘profit’. Commonwealth bank came out today reducing mortgage rates by 0.4%. Westpac is sitting on the shelf ref interest rates until tomorrow, consumed by their half year results announcement today. Gail Kelly, CEO of Westpac, one of the top 10 most influential women globally is deflecting interest rate questions while she explains why Westpacs first half profits have fallen by 0.25% to – wait for it – $297 billion. ANZ are not expected to announce their plans until next Friday.
So where are the leaders to watch in this country right now and how are they adapting to economic pressures?
It may be ironic that I’m choosing the CEO of a bank in such a financially charged and polarising week as an example, but one leader that did impress me this week is Ian Narev, the relatively new CEO of Commonwealth bank. I heard him speak at a TransTasman Business Circle lunch on Tuesday with 600 business leaders at the Westin hotel, Sydney. The experience was a pleasant, refreshing surprise. We absolutely need more young, charismatic and energetic leaders in Australia to drive positive direction and change. With over $4 billion of customer money under his care, and over 52,000 customers logging in to netbank every hour, Narev is running an institution that underpins the Australian economy. It was cute to see his Mum, Dad AND brother in the audience to whom he frequently referenced in terms of learnings, case studies and for consumer research.
What did he have to say about leadership and driving change in political and economic instability? The factors affecting him right now include internet speeds getting faster, devices becoming more mobile, data storage costs going down and the change in customer relationships where social interaction is key.
To recount a Narev story on change – last year during the Royal Wedding, he with his CIO, witnessed a game changer when netbank use peaked. What change did it demonstrate? That banking is becoming a COMPANION ACTIVITY. It is something we do while we are doing something else. As consumers, we now check on our balances or transfer money while we watch TV, at work, on our mobiles or even while in transit.
Six months ago the bank was experiencing 19% of customers transacting through mobile devices – through their mobile phones – the figure is now nearer 32%. While Narev noted he did not believe machines will ever replace people in stores – the future is looking a mobile one. He guided us to look at the new bank of the future at Darling Walk Sydney.
The themes of Narev’s speech were convenience, simplicity, information and trust. He talked of the ease of enquiry v information retrieval, siting new video customer enquiry initiatives that almost replicate a face to face experience and the ability for two Combank customers to transfer money from one Facebook account to another. Finally, Narev talked about courage. The courage it takes to be responsible for a switch of the entire banking computing system over a Christmas weekend when responsible for over 800 transactions a second from Christmas shoppers.
A strong, stable leadership is even more important during periods of economic and political instability – we need a belief in what we do, a good team around us, the ability to see and drive change, integrity and courage. Food for thought PM Julia Gillard.