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High Performance Client Management

October 26, 2012

Interview with Lorraine Montero on best origination practices and on the applicability of the HPCM program to the Middle Market banking segment.

Training and Performance Improvement in Financial Institutions

June 7, 2012

Quotes from the Author

“Training is necessary but never sufficient to improve performance so you have to think about all that comes before and all that comes after…”

“… you have to think of a process of learning…”

“[Training] is not about being a talking head … it’s about helping people become all that they can be”

“…what you want to achieve at the end of the day is people coming out of the classroom because they were able to do it themselves … so when they go back to the workplace they can more easily start applying what they learned for their benefit and the benefit of the organization…”

Fitch Ratings issues new report on earnings manipulation

February 10, 2012

The Dow is up.  Unemployment is down.  Corporate earnings are seemingly on the rebound.  As FDR himself would have sung, ‘Happy Days are Here Again’, at least it seems for some.   In line with heightened shareholder expectations, there will naturally come increased pressure to meet key performance metrics and financial ratios.  As a result, certain firms will undoubtedly feel the need to recur to ‘accounting manipulation’ to ‘make their numbers’. In this sense, Accounting Manipulation (Fitch Ratings) – Why, What to Look Out For and How to Adjust was a timely and useful find in this morning’s mailbox.

by Fritz Newman

Is Less More? – Part 2

July 28, 2011

Recently, as we were about to sign a contract for a series of instructor-led offsite seminars, the training manager in a large US Bank, subsidiary of a major global bank,  came back to say that given the feedback he had received from the line managers, we’d better start thinking distance learning. Four consecutive days was too much time for participants to be away from their jobs, and the logistics would be expensive. We revised our proposal and came up with a virtual classroom solution with 24-hours of training to be delivered over 16 one and half hour sessions with pre-course reading and pre and post-course testing. The project is under discussion.

The bank wants less.  Less time away from the job, less work disruption, lower costs.

Despite training managers still believing that people ought to take time to be away from work, they will often get push-back from line managers who value meeting short-term quotas and short term productivity more than investing in the longer term benefits of training. In my daily role of identifying learning needs and proposing solutions, I see that it is becoming harder and harder to take people away from their everyday tasks.

While unsure of how all will turn out, we are, nevertheless, looking forward to the prospect of embarking on this project, which would include adapting material to the virtual classroom. Among the challenges: How can we assure that the new solution yields results on par with the 4-day live classroom training? How can we guarantee we have the share of mind, buy-in and involvement prior to or after virtual training sessions? One of the objectives of the training program is to build momentum for a change in risk culture at the bank. Are we going to get there?

The above is one example of wanting to achieve MORE with LESS. The objective fits nicely within the parent global bank’s training goals of delivering the majority of its training virtually .

Like the example given above, there are many cases I encounter where corporate education is being clipped or condensed due to tightening budgets and resource limitations. There doesn’t seem to be one-size-fits-all here. Each situation needs to be analyzed in its own context and each solution carefully crafted to meet the need. In some cases, LESS will be MORE. In others, it will be just that: LESS.

by Alexandre Moreira

Is Less More? – Part 1

July 22, 2011

Having dialogued with corporate training managers for over 10 years now, I have been exposed to a discernible trend towards less: less classroom time, less face-to-face interaction, and fewer hours of training to address a given performance gap. This results in shorter training interventions, shorter and less dense case studies, little or no pre-work, and less time away from work – the latter often being a requirement from line managers. The classic  week-long off-site residential in-company training program – though we still run plenty of them- is gradually being supplanted by shorter programs. Why sit through 1 week of training if you can get SO much more done online as part of your normal working day?

No surprises, right? We all know we live in an ever faster paced world. Less is often seen as more, and I am a proponent of this. Keep it simple, straight to the point and don’t waste people’s time.

But in the case of quality training, the question that remains unanswered in my mind is: How beneficial is LESS? At the root of my question are “attention span” and “share of mind”.

I recently shared an article on Facebook from a Harvard Business School Blog site authored by Tony Schwartz, titled “Take Back Control of Your Work (and Life)” ( Tony argues that we live in a cluttered world and that we should, among other things, manage the input/output channels in a way that allows us to focus on one task at a time. Give yourself space for contemplation and manage (not be managed) by technology. He emphasizes that tools such as our iPads, Smartphones, Skype, Twitter, live chats,  cell phones, etc… can all be good for productivity, if managed properly.

Within minutes of sharing the article on Facebook, the comments started to pour in. It was remarkable to see how the article resonated with people across the generations, professions, backgrounds, and cultures. Most people seem to be struggling to manage today’s constant buzz of input and output from the variety of channels we have open 24/7. Our minds have become more and more cluttered and share of mind is ever harder to get. I would even dare to say that some people (particularly outside of the Millennial generation) yearn to read a book instead of articles; watch a 2-hour movie instead of video clips; participate in a monographic discussion instead of jumping from Tweet to Tweet.

So how does this relate to training you ask? And when is less more? More thoughts on those question in upcoming blogs. Meanwhile I invite your comments and opinion.

By Alexandre Moreira

Dodd-Frank – One Year On

July 11, 2011

“Not perfect but at least a step in the right direction.” That sums up the tone of The Dodd-Frank conference, hosted by the Pew Financial Reform Project and NYU Stern School of Business that I attended June 26th in Washington, DC. That conference contrasted sharply with the GARP conference I attended in New York earlier in the year. The GARP conference was attended by bankers and practitioners of risk management whereas the Dodd-Frank conference was populated by policy makers, government agency reps, academicians and research institute policy wonks.

The conferences provided different perspectives on the financial crisis, GARP was “friendly” to the banking industry, whereas the Dodd-Frank Conference was stark in its assessment of financial institutions responsibility for the crisis.

Thomas Hoenig, President of the Federal Reserve Bank of Kansas City minced no words and flatly stated in his address that “I suggest that the problem with SIFIs is they are fundamentally inconsistent with capitalism.” [SIFI are Significant Financial Institutions or simply those deemed too big to fail.] I kept wondering if this was a trial balloon by the Fed.  His speech is reproduced at and the video can be viewed at (Mr. Hoenig’s speech begins at about the 40 second mark).

Neil Barofsky, former Special U.S. Department of the Treasury Inspector (who played a critical role in the TARP funds distribution) provided his insight into the crisis. In particular, he pointed out that $700 Billion was originally approved by Congress with the understanding that the funds would be used to purchase bad mortgage assets and that these would then be modified. What happened though was quite different. The banks invested the funds elsewhere and did NOT modify mortgage loans.

This left many people on Capital Hill quite upset about what was done or not done and prolonged the mortgage crisis by dragging it out longer than needed. Mr. Barofsky’s no hold barred comments may be heard at (his comments begin almost immediately).

Many participants at the Dodd-Frank conference would have wished for more comprehensive legislation (i.e. making the Volker rule law or re-instating Glass-Steagall). Instead, what has become law is full of imperfections. Nonetheless, it is a step in the right direction and perhaps the best we could have expected given the need to balance passing a piece of legislation with the politics of getting it passed.

by Patrick Kedziora

Thinking of implementing standardized training around the globe? Here are some of the challenges you will face.

July 7, 2011

Designing and implementing a global training effort to standardize programs across different geographies sounds like a good idea. The rationale for doing so may include the objectives to  i) reduce development costs for country training centers, ii) ensure the delivery of consistent lessons and services globally, and iii) help develop a common culture and language within the institution.

Such undertakings are often done on a grand scale. Programs are mandated at Group Headquarters, developed at a single location and later rolled out around the world against fixed deadlines.  On paper it looks good. The roll-out strategy is conceptually seductive in its simplicity.

But, will it work?   Will it be a program laced with British or American examples that are incomprehensible to Indonesian, Turkish or Brazilian employees? Will the text read like an instant Google translation of a foreign website?  Or will the program function as planned?

Let’s take a look at some of the issues that will have to be addressed.

Technical terms and acronyms. The first challenge is to ensure that technical terms and acronyms used throughout the training materials are properly translated, explained and listed in a separate document.  Start the translation process with the creation of this document. Translations should be then be approved by the institution’s local subject matter experts.  This will i) ensure consistency in the use of those terms and acronyms throughout all the institution’s materials, ii) identify terms that refer to concepts not relevant in certain countries and allow you to make adjustments for them, and iii) make sure that terms unique to your company are translated appropriately, as they are likely not to be familiar to external translators.  Additionally, designers should stick to a rather neutral language understood internationally and avoid terms or expressions that pack a punch in a local context, but will not be understood by local staff 5000 miles away.

Translators.  Hire translators who are knowledgeable about the technical topics being presented. You may use more than one translator, but make sure each one’s work is coordinated by a central authority, inside the institution if possible, or outside, as needed.

Examples and exercises. Use examples that have the widest spectrum of applicability around the world. Avoid examples and exercises that focus on customer industries that are unique to one country or carry such a high degree of risk that they are rejected in other locations.  Even though you may be using examples that are purely hypothetical, participants often react negatively or have difficulty applying new concepts to industries that they feel are not representative or relevant to their reality.

Products and services.  Make sure the products and services you are depicting during the training are universal in nature. Stay away from references to products and services, systems, practices, and/or legal entities unique to one or very few marketplaces.   Undertake appropriate due diligence in advance by checking with your businesses in other countries to insure relevancy.    

Document format and design. A major challenge occurs when using formats that are specific to one country, usually that of the head office.  In such cases, it is probably best to eliminate these, especially if they add limited value to the training.

Presentation of accounting statements often falls into this category as they vary from country to country. Build in options for alternative presentation formats when designing materials and provide instructions for the selection of the appropriate format to be used in a specific country.

Paper size and page layout. One size or layout does not fit all. Decisions involving i) paper-size selection, such as Letter or A4, ii) PPT presentations (Windows or Apple, Office version 2003, 2007, or 2010), or iii) mandatory use of color or not, all require planning.

Will the training materials be disseminated in a standardized format or customized to each business unit’s capabilities?  Make sure that the material content can be easily rearranged to accommodate changes as a result of customization and/or adaptation.  Also, it is not unusual for the text of materials translated from English to expand (or shrink) when translated into another language.  This will impact everything from page numbering and table of contents to positioning of questions and answers.

These are just some of the challenges that global institutions face when attempting to standardize their training materials across different countries.  These require considerable initial thought and effort during the analysis and design phases of your training materials, but that time spent will pay off later when translating and localizing your content.

Think globally and act locally to produce the best results.

by Gerry Tompkins

Watch on the Rhine – Too big to fail

June 28, 2011

Is it just me, or does ‘TBTF’ sound all too disturbingly like the frozen yogurt chain?  I, for one, am happy to observe increasing references to ‘systemically important financial institutions’ and ‘global systemically important banks’.  If we can’t be serious about financial reform, let’s at least come up with a dignified acronym.  ‘SIFI’ has gravitas by comparison.

Yesterday, at its 25 June 2011 meeting, the honchos over at the Basel Committee on Banking Supervision agreed on measures for global systemically important banks (‘G-SIBs’). These measures, intended to reduce moral hazard, were widely expected, and included:

–   Methodology for assessing systemic importance (size, complexity, degree of global activity and  interconnectedness with other institutions and difficulty in replacing)

–   Additional required capital for these selected institutions (additional high-quality, Common Equity Tier 1 capital ranging from 1% to 2.5%, depending on the degree of systemic importance),

–   Incentives to limit and reduce systemic importance (institutions whose systemic importance continue to increase will face a further 1% surcharge, bringing the total to 3.5%).

–   Specification of an approval period and phasing-in period (January 2016 through to the end of December 2018, in parallel with the Basel III capital conservation and countercyclical buffers).

A full copy of the press release ( is located on the website of the Bank for International Settlements.

Let’s return to moral hazard, and also to frozen yogurt, which debuted on the American cultural scene while I was living in a coed dorm alongside many diet-conscious young women.  What could have been healthier than yogurt?  And it did purport to contain fewer calories than ice cream.  But just as superior climbing gear can entice mountaineers to tackle more risk, and safer autos can induce drivers to increase their speeds, back in the dorm waistlines actually increased in line with the frequency of visits to frozen yogurt shops.

Let’s hope that these new measures prove successful, and that risk and moral hazard both reduce, but let’s also not forget that economics is a behavioral, and not a physical science, and that this time might not be different.  Be careful out there!

by Kurt Muller

Watch on the Rhine – Anyone paying attention?

June 28, 2011

At the end of last week, McKinsey & Company released the results of a survey conducted in May of this year with financial-services executives representing a wide range of banking and financial institutions.  Titled Assessing banks’ confidence after the crisis’, it can be downloaded at (

In the words of its authors, the survey demonstrates ‘a mostly positive view on banking—and some signs of industry complacency.’ It is well worth reading for its many insights, particularly regarding apparent complacency.

I am most struck by the lack of concern and urgency relating to Basel III regulation.  Only half of the respondents stated that new regulations would have more than a marginal impact on their institutions’ future growth and profitability.  Nearly a fifth said that their top management still spends the same amount of time on regulatory strategy as they did prior to 2008.  Anyone paying attention?

by Kurt Muller

Watch on the Rhine – Intro

June 27, 2011

Occasional observations on Basel Legislation and Implementation

In 1941, Lillian Hellman’s play Watch on the Rhine opened on Broadway to a highly enthusiastic US audience very much attuned to events on the European continent.  Two years later, with the world still in the throes of WWII, Bette Davis headlined the even more successful screen adaptation.

The powerful Rhine River runs alongside the Swiss city of Basel, where the headquarters of the even more powerful Bank for International Settlements is situated.

Like Hellman’s work, this occasional column seeks to treat a subject that starts in a European city but plays out across continents.  Our topic, too, comes with its fair share of emotion, suspense and intrigue; intelligent, timely and resolute actions are likewise demanded.  In the case of Basel regulation, as was the case for Hellman’s work, the story’s final ending remains unknown.

By Kurt Muller