Why Your Bank Needs a Strategic Plan

Intro: Helping community bankers grow themselves, their team and their profits. This is The Community Bank podcast.

Eric Bagwell: Welcome The Community Bank podcast. I’m Eric Bagwell, director of sales and marketing for the correspondent division of SouthState Bank. And joining me today is Caleb Stevens. Caleb’s a business development officer here at the bank. He also produces this podcast for us. Caleb, how are you doing?

Caleb Stevens: Doing great. Good to be back for another show.

Eric Bagwell: Absolutely. Hey, today we’ve got on the show Bert Purdy. Bert is a CPA based out of St. Louis, Missouri with BKD. It’s a large public accounting firm. Bert does strategic planning for community banks and incorporates culture into a strategic plan. And I’ve been in a few sessions in the past and have never heard culture as a part of strategic planning, but I think it’s probably pretty common now. It’s been a while since I’ve been in one, but culture is such a big thing now. And Caleb, tell us how you actually met Bert? It’s an interesting story.

Caleb Stevens: So, we met on LinkedIn out of all places, which is kind of a millennial thing to say, you know, you meet somebody on LinkedIn, but he posts a lot as really great content and has a lot of followers, I think three grand or so followers. And I just started interacting with him on LinkedIn and he started listening to the show and we just kind of connected over that and felt like, wow, he’d be a great guy to have on the show to talk about not just LinkedIn, but as you said, strategic planning culture. He really brings a refreshing perspective, I think, to how to think about a strategic plan and why you even need one, maybe if you’ve never had them before and why you should implement one.

Eric Bagwell: Absolutely. And if you guys are out there and you’re thinking about, you know, starting to do a strategic plan or you’ve got one coming up, and I know that the banks that do this, they’ll get other folks to come in occasionally and lead those Bert would be a great person to have come in. We have a place at the end of the interview where he gives his contact information. So please reach out to Bert if you find this information good, which I think you will, he’s got some really cool ideas that he talks about. Before we get to Bert though, I want to talk about one of our products here at the correspondent division we’ve got a great product, it’s a loan hedging product called Arc, ARC. I think a lot of folks listening probably actually have used the product, or you’ve probably maybe had somebody come by from our division and talk to you about it. And basically, it’s a, long-term fixed rate loan that a lot of borrowers are looking for now, but banks are not willing necessarily to give. Caleb to sell this product in Kentucky. You sell it in Georgia. Talk more about Arc and how it’s a good program for banks out there to use?

Caleb Stevens: Sure. Well, I would just ask our listeners, you know, what do you do when someone asks you for a long-term fixed rate loan? Do you go ahead and make the loan and put that on your books fixed for 20 years and take that interest rate risk? Or do you maybe talk them into a shorter rate and shorter term I mean, and maybe you risk losing their business? And this was an issue we saw community banks having, you know, traditional back-to-back interest rate, swap programs are confusing, complex, so much documentation. And we said, how can we make this really, really, and allow community banks to offer a long-term fixed rate loan while booking that loan at a floating rate on their balance sheet. So that’s what Arc is. You can lend fixed out to 20 years, put the loan at a floating rate generate fee income all without any derivatives, hedge accounting, all the stuff that makes your CFO’s a head spin. And so, it’s an awesome product. We love selling it and we love serving community banks and helping them really gain a competitive advantage against their larger counterparts and larger competitors in the markets that they serve. So, love Arc, and I would love for folks to check it out.

Eric Bagwell: Yeah, it’s a great product. And for more information on it go to our new website, southstatecorrespondent.com/arc, there’s a lot of information there. We’ve got a video that we put out that’s got a lot of information on it. Real quick video that’ll tell more about the program and there’s a place you’ll see on the website where you can reach out to somebody for more information. So, we are glad you guys have tuned in today. Let’s now go straight to the interview with Bert. Bert, we appreciate you being on our podcast today. All the way from St. Louis, Missouri. Give us a little bit of your background and how you’re working with banks these days?

Bert Purdy: Well, I worked for BKD, which is 12th largest public accounting firm in the nation, and we’ve got the largest community banking practice. And I got into it really by happen chance when we start in public accounting, at least in this firm, we get to work in all the different industries and the leader of our banking practice was a partner here in our St Louis office. And I saw how everyone respected him and how hard he worked. And I just thought that’s a great guy to model myself after and after working on some clients with them and really getting to understand the goals and mission of community banking. That’s where I went. You know, I got into public accounting really by accident. I chose accounting, so I could hide behind a computer and not talk to anybody all day. I grew up really shy, introverted kid. And then once I got into public accounting, you know, I took the job, but I didn’t know what public accounting was and then discovered very quickly that that’s a people profession. So, I had to get out of my shell and it’s really helped me to do that. So now, you know, doing things like this, writing, speaking on stage are some of the most enjoyable things I get to do on a day-to-day basis.

Eric Bagwell: Let’s talk a little bit Burt about your online presence? You’ve developed quite a following and a prominent voice on LinkedIn. Was there one thing that kind of, kind of steered you in that direction and what, what prompted you to sort of develop that, that personal brand online and, and how has it helped you personally?

Bert Purdy: Well, a couple of different things. If you’re familiar with Sally Hogs said she has a quote that “different is better than better.” So, I chose very early on that I needed to do something different than what most accountants would do. So, I got on LinkedIn very early. I mean, I wasn’t in the first couple of years, but still very early and used my writing and communication skills on there. One of my, I have a personal branding statement that I live by, and it basically says that what I want to do every time I come into contact with someone is influenced them in a positive way. So, if I can do that to the masses on LinkedIn, it’s even better. I way back in the day, I wrote a blog called intentional employee. And that was basically how to love your job, how to have positive attitudes and everything that you do. And so, I shared a lot of stuff on there and I had clients all the time first. I see all this stuff that you’re posting on LinkedIn, and they just kept commenting on it and that really proved to me the power of it. And so now I don’t post now as much as what I used to, but it’s a lot more focused on what I do and really about culture, communication, employee engagement. You know, I don’t post about specific banking topics very often because banking is banking. Banking is really made up of people. So, if we can get people involved, that’s really where I focus.

Caleb Stevens: That’s a great point because we talk about stuff, you know, that we send out and in events we try to put on and like you said, banking’s banking, you can get, you know, banking topics from a plethora of different, you know sources. And so, we’ve debated back and forth, you know. Do we talk about banking at certain times? Do we talk about culture leadership? And I think a lot of things we’ve done in the past, or a few things we’d done in the past really, we’ve gotten a lot of good positive feedback because it wasn’t banking related. So, it’s a great point that you make. We’ve got folks that are that have built a little personal brand as well. You know, working for us. For somebody that’s out there listening that wants to do this and LinkedIn’s a great way to do it. What do they need to be considering? You mentioned something, you know, not just putting out banking stuff, but what are the things that they need to consider in building a personal brand?

Bert Purdy: Well, you know, everyone has a personal brand. It’s just whether you’re intentional about it. So, I view it this way. You can’t control what people think of you, you know, their perception becomes a reality, but what you can control is what you put out for people to see. So, I think it needs to be a very intentional process of how do I want to be seen. So, one of the things that I’ve always followed, which is advice from a mentor of mine is, I don’t want to be famous. I want to be respected by my peers. And so, if I can be intentional with my brand, put things out that will help that respect and from even a business development perspective, I want to do business with, or people will do business with people that they know like and trust. So, I need to put things out there that will help people know, like, and trust me. And now I think it even has to go a step further liking isn’t enough. It needs to be known love and trust. So, they need to love you and whatever I put out there needs to encourage that. And so just putting, you know, I’m not a facts and figures sort of guy, I’m the accountant that doesn’t like numbers, I’m bigger into the culture and employees, how to get people involved and really engaged versus just throwing out facts and figures.

Eric Bagwell: Right.

Bert Purdy: And that’s what I want people to see me as.

Eric Bagwell: And kind of in that regard, let’s talk about one of the things you’re really passionate about is strategic planning. And that’s one of those principles or concepts that it’s easy to read it on paper. It’s harder to put it into action, you know, with living, breathing human beings. So, you know, what does this mean for you as far as what a strategic plan looks like, and how do you kind of go about that process of doing it?

Bert Purdy: Well, strategic planning, there is no one size fits all, but a lot of people try to make it a one size fits all and a lot of people view it as a document. You know, we need a strategic plan document, but a strategic plan is really a process, right? It’s a process of what are your goals, and then what are your strategies to get to those goals? And I also believe that employees are the ones who make the success, unless you can get employees to buy into what those goals are, there is no point in even doing it. So, you can have a board that can put together a strategic plan, but if they don’t tell the employees about it and don’t tell them why they want to reach those goals, there’s no point in doing it. So, the strategic planning process I typically use is to give the employees a voice. I use employee surveys very heavily to judge the culture, to judge their engagement and what the mission of the bank is. And I’m a big believer and figuring out the true mission of what that organization is, you know. The reason I get to wake up every day is because I know I’m helping my community bank clients help their clients dreams come true. And I think that’s what banking is all about. A lot of people go to go and work at the bank for a paycheck. They don’t go for a purpose.
So, I really try to get that purpose in front of those employees and help them understand that. And if you’re familiar with Simon Sinek, I show his start with “Why TEDx” talk and all of my strategic planning sessions. One of his things is profit isn’t a purpose, it’s a result. So, our purpose is to achieve that mission of helping people’s dreams come true. If we do that, the is going to follow. So, I even get a lot of my clients to take profitability, shareholder return out of their mission statement. That’s not what the mission is, that’s a result. So there, I really try to work employees and a lot of the strategies are, how do we improve the culture? How do we help the employees build personal brands that the community is going to want to engage with? And then once you get that, all those results will follow.

Eric Bagwell: And our listeners, I think every one of them probably have done a strategic plan or at least participated in it. Can you just highlight on then you’ve already, you know, for the most part have, but just kind of two or three key elements that you think a strategic plan has to at least address in your eyes?

Bert Purdy: Well, growth is always out there, but I’m not a big fan of, we want to have growth of this percentage. We want to have profitability or ROA of this because that’s the end result, but how are you going to get there really needs to have goals. So, practices, what are the practices we’re going to put into place? That’s really what I try to get out of the surveys that I do. And of course, those are confidential so people can really feel comfortable telling what they feel. So those practices, and if it’s a really big stretch goal, break it down into short term goals. So, you can celebrate along the way. You know, you’ve got the whole SWAT that everybody does that’s included, but it really doesn’t provide a lot of benefits. I’ve seen strategic plan documents that are, you know, a hundred pages, but there’s really only two pages of substance to it. And so, you know, make it easy, make it memorable. And the most important thing is talk about it. It can’t sit on a shelf. It needs to be talked about at every employee meeting, every board meeting, it really needs to be a living breathing plan versus just the document.

Eric Bagwell: Bert I’ve been in one strategic planning session in 22 years of banking. It was not. I take that back. I was working for a company and have been in a couple of there, but for a customer bank of ours, I was invited to be at a strategic planning session that our company at the time was actually leading. And this is back in 2007, 2006. So, growth was a major part of the plan. They were talking about opening LP goes, you know, around North Georgia. And so, we know where that landed. That bank actually did not fail, but got in a lot of trouble as did a lot of banks with A and D lending. But it’s interesting to hear you talk about culture being discussed because it was, I can’t imagine back then culture was ever discussed in a strategic planning session. What, when you get in front, I know you said you do confidential surveys. How many banks are actually thinking about this before you actually talk about, I mean, are a lot of banks nowadays, even bringing that culture into the equation with a new strategic plan, what are you seeing? And what’s kind of the feedback when you get, when you’re telling somebody, Hey, I’m going to do this strategic plan for you, but culture is a big part of it. What’s the reaction?

Bert Purdy: More and more bankers are getting into it. I gave a talk down in Orlando right before COVID hit last year and it was on strategic planning and picked up a client through there. And from that talk and talking with them, they talk about all the things that I do. So, he said, you’re a perfect fit for what we talk about. They’re a heavily engaged culture and just phenomenal bank to work with because of that. And more and more banks are getting there. Now there’s still what I will call old school. It’s not age related, but still old school thinking of we’re just here to make a dollar. We expect our people to work here for 30 years and not complain and just come and do their job. Well, especially for the younger generation. Younger generations want to have a purpose in what they’re doing. That’s why they’re willing to move from job to job because they want one, they want to have a life, but two, they want to serve a purpose. And I really think if we want to attract the younger generation into banking and the younger generation into being clients, which we have to do otherwise, you know, there’s not going to be anybody left. We have to bring them in. We have to show them what the purpose is. And so, there are more and more, but I still, you know, see several banks that, you know, they just want the ROA. They don’t really care about the employees, but thankfully that’s more of the bigger banks than it is the smaller community bank. Most of the community banks, they believe in their communities. So, they believe in that culture.

Eric Bagwell: Yeah. And that’s a great point. You make, we’ve had a couple of episodes we’ve done on millennials and to attract the talent that you need going forward in this next generation coming up, you’ve got culture cyst, a huge part of it. And everybody knows that the Chick-fil-A model, and there’s just so many companies out there now that really push that and the word has gotten out. So, it’s just, it’s neat though, that you provide this service and it gets instilled in a strategic plan because it’s something that’s just essential for everybody. Well, listen, we appreciate you being with us today. Tell us though how folks can get in touch with you if they want to reach out to you and maybe bring you in for a session.

Bert Purdy: Well, I appreciate that and appreciate the opportunity to be on here. It’s been a fun discussion. People can reach out to me two ways. One on LinkedIn, I’m on there. Connect with me, message me and number email me. It’s R as in Robert Purdy, P U R D Y@bkd.com.

Eric Bagwell: That sounds great, man. We appreciate you being on today. Great topic. Yeah, it was Bert. Thank you very much. And it’s funny, you know, we’ve talked about we’ve had a few shows of culture and so it I think that’s obvious that it means that just becoming a bigger and bigger part of banking as we move through the younger generation. So again, thanks Bert for your insights on that today

Bert Purdy: Well as they say at Chick-fil A, “It’s my pleasure.”

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