Key Leadership Trends to Embrace NOW

Jim Marous (00:00):

Welcome to Banking Transformed, the top podcast in retail banking. I'm your host, Jim Marous. In today's episode of the Banking Transformed Podcast, we are revisited by Jacob Morgan, five-time bestselling author and renowned leadership futurist.

Jim Marous (00:27):

Jacob has worked with and interviewed hundreds of top business leaders around the globe to uncover the most critical leadership trends shaping the future of work today. He's here to share his groundbreaking research on the top seven leadership trends for 2024, and how they'll impact the banking industry.

Jim Marous (00:46):

Jacob reveals actionable strategies to help you and your organization navigate the complexities of modern leadership. From leading with vulnerability to enhancing the employee experience, prioritizing skills over jobs, and embracing AI and the hybrid work models, Jacob offers practical strategies for banking executives looking to future proof their organization.

Jim Marous (01:12):

There's no question that the dynamics of leadership are in constant state of transformation as organizations grapple with the impact of hybrid work, the escalating demand for talent, and the fear of the impact of the AI. So, Jacob, it's great to have you back on this show.

Jim Marous (01:28):

So, Jacob, it’s great to have you back on this show. You and your wife were both guests early in the creation of the Banking Transformed Podcast, and your shows continue to generate quite a bit of listening.

Jim Marous (01:36):

While we were in the throes of COVID when you were on the show the last time, what has been the greatest change in the skills needed and the challenges presented to be an effective leader?

Jacob Morgan (01:47):

Oh, man specifically for COVID. So, when I wrote the book-

Jim Marous (01:50):

Actually, since COVID because everything changed since COVID far as state of work. But I'm wondering what have you seen as a transformation since 2020?

Jacob Morgan (02:00):

Oh, since ‘20, I think there's been a few things. So, when I wrote the book, The Future Leader, that one actually came out in 2020, and I think it was right around the pandemic. Because I think the pandemic was officially declared a pandemic in March, I believe. And my book-

Jim Marous (02:16):

March shut down sports, March 12th.

Jacob Morgan (02:18):

March 12th, yeah. And my book came out I think right around that time, or maybe a few weeks before. So, it was very close. But the research that I did for that book was specifically looking at things like mindsets, skill sets, challenges for current and aspiring leaders. And so, from that regard, I don't think there's been too much change as far as mindsets and skills.

Jacob Morgan (02:43):

So, some of the mindsets, and I don't know if you want to go over all of them, but some of the mindsets that I thought were really important that these 140 CEOs identified were things like having the mindset of the chef, which is about balancing technology and humanity.

Jacob Morgan (02:58):

Having a servant, a global citizen mindset, I should say, which is about seeing big picture. It's surrounding yourself by people who are not like you. There was also the mindset of the explorer, which was this idea about having a growth mindset. And then there was also the mindset of the servant, which is not quite the same thing as servant leadership, but there were some similar attributes in there.

Jacob Morgan (03:22):

And then we had skills like the futurist, which is being able to not predict the future, but to not be surprised by what the future might bring. We had the skill of the coach and coaches helping make other people more successful than you.

Jacob Morgan (03:36):

The skill of the translator, which was about listening and communication, the skill of Yoda, which was about emotional intelligence, specifically empathy and self-awareness. And then which one am I missing? So, there was five.

Jacob Morgan (03:50):

So, we did the coach, the translator, we did Yoda. That's the one I missed, technology teenager, I thought I said that one. And that's really the skill of embracing technology and not running from it. That's especially very true and relevant now as we think about this ChatGPT, generative AI driven world.

Jim Marous (04:09):

So, you just recently came out with a PDF white paper around the top trends of leadership for 2024. And the first one you mentioned it was kind of interesting because I related to it quite a bit. The importance of leading with vulnerability while also showing competence.

Jim Marous (04:31):

I sometimes look at it saying, "You don't have to be the smartest person in the room, but you've got to be the best listener to be able to put all these pieces together." How can banking leaders strike a balance effectively in this way where legacy thought was, you got to be the best, you got to be the highest, you got to be the smartest, when really that doesn't work to your favor as much anymore.

Jacob Morgan (04:57):

And by the way, if anybody want — can I tell people where they can read the PDF if they're interested?

Jim Marous (05:00):

Definitely, yeah.

Jacob Morgan (05:02):

So, if anybody wants the PDF, we actually just put it out. I don't even think we made it completely public to everybody yet, but I think by the time this episode airs, it will be, they can go to topleadershiptrends.com and you can just download the PDF there and you can see what those eight are.

Jacob Morgan (05:16):

Leading with vulnerability, that was actually the subject of my most recent book that came out. And it's this idea of, so we've been talking about vulnerability for a long time over the past few years. Obviously Brene Brown pioneered a lot of work in that space.

Jacob Morgan (05:31):

But vulnerability in the context of work is really about exposing a gap that you have. A gap in maybe experience or wisdom or knowledge or emotion or skill, whatever it is. It's basically saying, I have a gap in this area.

Jacob Morgan (05:43):

Inside of the workspace, well, let me start with personal life. In your personal life, there's a lot of value in that. It creates connection, relationships with your spouse, your significant other, with your friends. It's very clear why you want to do that.

Jacob Morgan (05:56):

At work, you have a different dynamic. You have a boss, you have employees, you have projects, deadlines, a hierarchy. You're being paid a salary, you have customers. And so, you have to imagine if you keep showing up to work each day just talking about the gaps that you have, eventually someone's going to look at you and say, "Why are you working here?"

Jacob Morgan (06:13):

So, leading with vulnerability, on the other hand, is talking about the gaps that you have and demonstrating what you're trying to do to close them. So, a very simple example would be, again, let's say we’ll go with banking.

Jacob Morgan (06:25):

Again, it doesn't really matter what industry you're in, but let's say your boss gives you a big project to work on, and you screw it up and you make a mistake. You go to your boss, and you say, "I'm really sorry. I know this was an important project, but I made a mistake. I screwed up."

Jacob Morgan (06:40):

Now, it's great that you have the psychological safety where you can go to your boss and acknowledge the mistake that you made, but I can promise you that your boss at the time is not looking at you and saying, "Oh, gee, thank you so much for telling me about this mistake."

Jacob Morgan (06:52):

Your boss is probably looking at you and thinking, "Okay, now what? The customer is still unhappy, the project still hasn't been done, the deadline still hasn't been met, the revenue goals still have not been achieved. What are you going to do about it?”

Jacob Morgan (07:05):

Leading with vulnerability, taking that same scenario is saying, "Hey, I'm really sorry I made a mistake. I acknowledge how important this project was, but here is what I learned from the mistake that I made, and here are three things that I'm going to do to make sure that that mistake never happens again."

Jacob Morgan (07:18):

So, I have the vulnerability component, but I'm also adding in the leadership component, the competence piece. I'm demonstrating what I'm trying to do to close the gap. And that is a very important distinction.

Jacob Morgan (07:29):

If you have friends, for example, who are always telling you like, "Oh, yeah, I want to quit smoking, I want to exercise, I want to eat healthy," your question to them is, "Great, have you started, are you exercising? Are you starting to eat healthy? Tell me what you're doing." You don't just want people to come to you and talk about the gaps that they have. You want them to demonstrate some level of closing those gaps. And this is especially true inside of the organization.

Jacob Morgan (07:59):

Even if you don't know something or you make a mistake or you need help with something, that's fine. You can acknowledge that, but then also talk about what you're trying to do to solve the problem. That's a very, very important distinction.

Jacob Morgan (08:12):

And so, the whole idea of leading with vulnerability is about the two most important roles that any leader has competence and connection, demonstrating and being good at your job and being able to connect with your people.

Jacob Morgan (08:25):

For a long time, we’ve been focusing on connect. Well, I guess originally, we started very much focused on competence, and we ignored this whole idea of connecting with your people. Then over the past few years, we've been very, very obsessed with connecting with your people, and we forgot about competence.

Jacob Morgan (08:43):

So, 2024 and going forward is about bringing together both of those things. Because if you only focus on competence, people will look at you and they'll say, "Yeah, you're really great at your job, but I feel like I'm working for a robot. I don't feel engaged or motivated or inspired by the work that I'm doing, even though you're really talented."

Jacob Morgan (09:01):

Similarly, if you only focus on connection, people might say, "I feel engaged and empowered and inspired by the work that I'm doing, but I don't think this person's a great leader. They're not demonstrating any kind of leadership or competence. I feel like I could do their job.

Jacob Morgan (09:14):

So, you want to be able to do both. You want people to connect with you, and you also want to demonstrate that you have the capabilities and the skills and the competence to be good at your job.

Jim Marous (09:25):

It's interesting, we talked about the post COVID thing, and one of the things that came out of that is a whole lot of hybrid work. And banker executives tend to like things the way they were as opposed to the ways they can be. So, they've been really struggling with the whole concept of work ethic in a post pandemic environment and a hybrid work environment.

Jim Marous (09:44):

What strategies have you seen, not just in banking, but overall, where executives really try to build the next stage of work at their organizations? How have you seen leaders really excel at building the next wave of banking? Be it hybrid, be it full-time in office or not? How do they go about the process of being a leader in that case?

Jacob Morgan (10:08):

Well, I think there are a couple different angles to look at. So, first of all, I'm a big believer in, in-person work. I'm not saying you need to be there nine to five, but there is substantial value for in-person work.

Jacob Morgan (10:19):

It's like for my industry, I give a lot of speeches to companies, and there's a difference between productivity versus impact. So, can I deliver more speeches sitting, staring at a camera in a day than I can deliver in-person speeches? Yeah. I could probably do four or five, six of these sitting in my pajamas, staring at my camera.

Jacob Morgan (10:40):

Is the impact going to be the same if I'm doing a virtual speech versus if I'm on a stage, I can see people, people can see me, I can look at body language, I can get together with people and talk to them. No, the impact is going to be far greater in person.

Jacob Morgan (10:54):

Similarly, in different aspects of work, if you're meeting with customers, you're looking at leadership training and development, coaching and mentoring, things like that, yeah, you could probably get that stuff done behind a screen, but is it going to be far more impactful if you do that in-person? Absolutely. So, for certain things, there's still tremendous value for in-person work.

Jacob Morgan (11:14):

Now, I think part of this also comes down to sort of two things. One is the goals and aspirations of the individual. So, if you are somebody who wants to break through beyond mediocrity, if you are somebody who wants to get into a leadership role, leading a team, a function, a business, maybe one day a company, you need to be in-person. You have to be in-person. There's just no way around that.

Jacob Morgan (11:40):

Why? I think a few reasons. Number one is you're going to get the coaching and the training from executives directly. They're going to see you; you're going to make an impact on everybody by having that kind of a presence. So, there's a tremendous and having that one-on-one time with these executives I think is tremendously valuable if you have those aspirations of leadership development.

Jacob Morgan (12:06):

If you are somebody who doesn't have those aspirations, you're content being where you are, you're content not excelling and growing and ever moving into a leadership role, hey, by all means, don't show up to the office.

Jacob Morgan (12:19):

I think a lot of people would argue that that's being content with some form of mediocrity if you don't have those aspirations. And it might sound cool now, but I can promise you, especially if you're younger, it might sound cool to be in your 20s, never having to step foot into an office, making a salary and maybe making some gradual improvements.

Jacob Morgan (12:40):

But I can promise you that when you're in your 30s, when in your 40s, and you have these different goals that you've set in your life where maybe you want to have a family, you want to buy a house, you want to I don't know, go out to nice restaurants, you want to do these types of things, I can promise you that you're going to wish that you had that more senior role. And every single CEO that I have ever interviewed has told me the same thing.

Jacob Morgan (13:02):

If you want to get into a leadership role, it requires sacrifices. You are going to have to do more. You are going to have to care more. Part of that means showing up to the office. Again, that depends on your goals and aspirations. If you don't have those goals and aspirations, by all means, you can work whenever, wherever you want. Just don't expect that kind of growth and development.

Jacob Morgan (13:24):

I think on the leadership side, it really depends on what you need and what you are looking for from your team. Obviously, if you have all-hands meetings, if you're having customers come into the office, if you're talking about strategic planning and decision-making meetings, yeah, get your employees into the office for that.

Jacob Morgan (13:42):

However, if somebody's just at home, they're catching up on some stuff, they're working on a presentation, they're doing a couple phone calls, they're doing some project management work, then yeah, as a leader, you can have that flexibility and say, "Yeah, it's not really necessary for you to come into the office today."

Jacob Morgan (13:58):

I think a lot of the recent research that's been done by Nicholas Bloom at Stanford and a couple others show that on average what the balance is, is around three days in the office, two days from home on average, as far as what the comfort level is. But again, it really depends on the work that you're in. It depends on your goals and aspirations. It depends on the requirements of the business as well.

Jim Marous (14:24):

So, it's interesting when you talk about the whole work environment right now, and when you look at digital transformation in almost any industry. How should leaders look at upskilling and reskilling initiatives and at the same time, how do you make it so that existing employees don't continuously feel threatened by the digitalization of their jobs?

Jacob Morgan (14:50):

So, how do you upskill?

Jim Marous (14:51):

Well, how do you balance the upscaling and rescaling with the overall change that you have to have towards the digital future? I mean, as I go to see organizations now and trade groups and everybody else, I think everybody's afraid of AI. Everybody's afraid that this is going to change — it's going to impact their job or make it so they lose their job.

Jim Marous (15:12):

Well, at the same time, their organizations many times are trying to upskill and reskill for exactly that reason. How do organizations, how does leadership make it so employees know that they are part of the future? Because I think that's the fear that's in back of everybody's mind. Is it a skill or is it a strategy?

Jacob Morgan (15:31):

Well, first of all, you should feel threatened for your job. You should a hundred percent be fearful of your job. There's this big stigma that fear doesn't belong in the workplace, I disagree. I think having a little bit of fear is actually a good thing. Fear is what keeps you working hard. Fear is what keeps you motivated. Fear is what keeps you doing good quality work. Fear is what keeps you doing the things that you need to do.

Jacob Morgan (15:53):

If you show up to work every day and you have no fear, you're a laissez-faire, "I don't care. I don't need to work. I don't need to invest my own time in training and development. I don't need to pay attention to these technologies. I'm in my comfort. I'm just chilling all the time," you got a problem.

Jacob Morgan (16:08):

You should be showing up to work thinking like, "Wow, my company's really making some investments here. I should probably figure out what's going on. I should probably learn about what things like ChatGPT are. I should probably connect with some peers.

Jacob Morgan (16:23):

I should probably talk to my leader and figure out some potential opportunities for career pivots if I need to in the future. I should talk about what the future of my role and my job looks like. I should ask myself, "What skills do I have? And if something does happen to my job, where else can those skills be applied?"

Jacob Morgan (16:41):

You a hundred percent should be having those conversations if you are in banking or if you are in any role for that matter, you should feel a little bit threatened. You should feel a little bit scared by the things that are happening. I mean, if not, there's something wrong. So, that's first of all.

Jacob Morgan (16:56):

Second of all, what should organizations be doing? I think leaders should be very honest and upfront with their people. I don't think you should sugarcoat anything. If you do see that there is some potential threat to somebody's role, you should tell them and say, "Hey, look over the next year or so, we're considering implementing something like a ChatGPT in this role. So, why don't we sit down together and figure out if you no longer had to do this aspect of your job, what else would you be able to do instead?"

Jacob Morgan (17:24):

Now, there's also a big difference between automating a job versus replacing a human. Accenture did this over the past few years. They automated around 20,000 jobs, but they didn't replace any people.

Jacob Morgan (17:36):

These were jobs in finance, these were who we would call number crunchers. And these were 20,000 people who essentially were collecting data, analyzing data, crunching data, and then presenting the data to their clients. And Accenture was able to use AI. They were able to use a lot of bots that could do the work of those 20,000 employees in no time, but they didn't fire any of these 20,000 employees.

Jacob Morgan (18:00):

Instead, what they did is they said, "That aspect of your job, we don't need you to worry about anymore. Instead, why don't we retrain you and upskill you to become more like a strategic advisor to your client? So, we'll have the bots do the data, you help the clients make sense of the data, help them figure out the strategic decisions and actions they should be taking as a result of the data that you're getting." That is the conversation that leaders should be having with their employees.

Jacob Morgan (18:24):

So, I think being honest and being upfront with your people, but at the same time, helping them figure out that path forward is the right way to go. It's very dishonest, I think, on behalf of leaders, if you have somebody, let's say in finance, and you know the technology's going to play a role there, I think it's very dishonest to go to your employees and say, "You got nothing to worry about. You can be here forever. No problems." You know that's not true.

Jacob Morgan (18:52):

I think the best thing that a leader can do is have that level of honesty but balance the honesty with strategic direction and vision for where that employee can go. So, if you get a sense that maybe roles in finance are going to be cut or automated, sit down with your employees and say, "Hey, let's take a look at the different skills that you have."

Jacob Morgan (19:13):

Focus on internal mobility. That's another big trend that we're seeing over the coming years from a lot of executives that I talk to is, how do we take employees that we have who know the business, who are talented, who have a lot of different skills, and just because their role is gone, we don't want them out of the company, but we want to figure out, maybe we can retrain them and upskill them.

Jacob Morgan (19:35):

Maybe they're in finance, maybe we can move them into another role, like customer experience. Maybe they have skills that are relevant to HR. Maybe they have skills that are very relevant to operations or product or project management and see how you can do those internal pivots.

Jacob Morgan (19:48):

I think that's a very, very big initiative that organizations should be undertaking. But the idea that you shouldn't feel threatened, that you shouldn't have any fear, and that leaders should tell everybody that everything's going to be okay, I think is a terrible, terrible strategy.

Jim Marous (20:03):

It's interesting in the banking industry, as we interview people across the globe as to what they do in their organizations we find that the best organizations, the organizations that are most future ready tend to be those where leadership has embraced change that's happening around them.

Jim Marous (20:20):

The thing that we all fear, which is change, and they've changed how they view the marketplace, how they implement their skill sets, how they communicate with employees, and how they deploy their intelligence into the organization. And those who stay with the same skills, with the same strategy, with the same business model from the past tend to be falling behind.

Jim Marous (20:43):

When you look at 2024 and you look at what's the difference between those executives that you already see, they get it, and those who are holding onto the past, what is the biggest trend or what's the biggest skillset that you see that difference between the winners and losers today?

Jim Marous (21:06):

It's funny because I tell people I can interview an executive in the banking industry within five minutes. I'm going to tell whether or not they're really walking the walk or they're just talking the talk. Because right now, with things changing so fast, if you're not embracing that change, and maybe that's the skillset.

Jim Marous (21:23):

If you're not embracing the change that's happening around you, you tend to fall behind very quickly and it shows. What are you seeing in the marketplace overall that when you look and say the difference in the way leadership's working today versus how it was implemented in the past what is the major skillset?

Jacob Morgan (21:39):

Well, first, I think the big question that leaders should be asking themselves is, how can I think of myself like an app. I mean, think about how many times you update the software on your iPhone, your computer. I mean, even my TV has updates like every week.

Jacob Morgan (21:54):

It's constantly fixing bugs. It's constantly updating software, improving features. My car, I have a Tesla constantly updating. Leaders how often do you take a step back and ask yourself, "Well, how often am I updating myself?" I mean, why should the TV or your phone be updating more often than you are?

Jacob Morgan (22:13):

So, what are you doing to update yourself? You should be the killer app. We talk about the killer app, you are that killer app. So, as far as what separates those who get it versus those who don't, I think there's probably a few things. I think those who get it, it's sort of probably the best analogy I can think of is exercise.

Jacob Morgan (22:34):

So, I'm really big into exercise. I'm really big into eating healthy. And I've seen a lot of friends and I know a lot of people who usually start and then they stop. And I think the big problem with those who are able to stay healthy and those who don't is those who stay healthy view it as an ongoing journey. They know that there's never an end point.

Jacob Morgan (22:57):

They know that this is a lifestyle, not a destination, versus those who view it as short-term as, "Oh, I'm just going to get in shape, and I have an end point here." Those are the ones who always fail because there is no end point. Because as soon as you get to a certain point where you like the way you look, you like the way you feel, if you don't keep going, you fall back.

Jacob Morgan (23:17):

So, what separates the leaders who get it versus those who don't, the leaders who don't get it, view it as an endpoint and they'll say, "Great, yeah, I'll do this transformation. I'm going to do whatever, X, Y, Z, I stopped, I'm there." And then things change again. And they're like, "No, no, no, I already did it. I already adapted. I already blah, blah." And the world keeps moving.

Jacob Morgan (23:38):

Versus the other leaders who do get it, say, "I'm on board, what else you got?" Make the treadmill go faster, make the incline, go up higher, add some weights on me, like I'm good. Like this is just the way that business is going to get done. This is just the way that … change is the constant. So, I think that's a huge, huge factor there.

Jacob Morgan (24:01):

And related to that is this idea of complacency. We're very comfortable being in our comfort zone. It's very hard to get into a cold plunge. Nobody wants to get into a cold plunge. It's freezing cold water. It's uncomfortable. You lose your breath, but then when you get out of it, you feel amazing.

Jacob Morgan (24:19):

So, a lot of leaders don't want to get into that cold plunge. A lot of leaders are like, "Ah, I'm good here. It's like 70 degrees. I got my comfy clothes on. I don't need to get into that cold plunge. That looks miserable." But the other leaders out there, they're getting up at five, at six, they're exercising, they're throwing themselves in the cold plunge, and they're adapting and they're doing it all the time.

Jacob Morgan (24:35):

So, when you're too comfortable in your little bubble, I think a lot of bad things happen. So, a lot of the successful leaders out there are constantly trying to figure out how do I make myself uncomfortable on a regular basis? And part of that is who you surround yourself with. Part of that is how you spend your time.

Jacob Morgan (24:56):

I remember I interviewed Frank Blake, he's the former CEO of the Home Depot, and he told me that one of the things that a lot of leaders forget is that leaders do more, and they care more. But I think the mentality of a lot of people who get into leadership roles today is you can do less, and you care less.

Jacob Morgan (25:14):

You got into the executive role, cushy, comfortable spot, just chill out. You got the good parking spot, the salary, the benefits, I'm kind of coasting. But the reality is that from every CEO that I've ever interviewed, ever advised, ever worked with, these people work harder than everybody else.

Jacob Morgan (25:30):

These are CEOs who are getting up at four or five in the morning so that they can have a little bit of time for themselves before they get into the office. These are CEOs who they are on all the time. They do more and they care more, they sacrifice. And that is, I think, the mentality that a lot of leaders forget that we need.

Jacob Morgan (25:49):

So, that I think is some of the really important factors that separate those leaders who are able to adapt and those leaders who are not able to adapt. I think it's a muscle and it's the difference between viewing it as a destination versus viewing it as just a lifestyle, a new way of how you live and work.

Jim Marous (26:08):

It's interesting being in the banking industry, one of the challenges, even though it works really well for the executives, is that no matter what size you're looking at, you see very few financial institutions ever cease to exist, ever fail.

Jim Marous (26:23):

In fact, they make money every year, invariably. Very few, I mean, we're talking less than a handful don't make money on a year to year. They may make more or less, but overall, they're making money. And so, the executives have always had success around them, and those executives around them have also experienced that.

Jim Marous (26:41):

So, what happens is if you listen to the same people who have the same thoughts, you're going to get the same result. But the banking industry doesn't change fast enough to make you pay for that sin, so to speak. And I think-

Jacob Morgan (26:55):

And I thought of one more by the way as well. I think a lot of people are exhausted with the transformation. And I think instead of focusing on transformation, it's far more valuable to have a transformation mindset.

Jacob Morgan (27:08):

I mean, think about how many transformations we keep talking about, transformation and leadership, digital transformation, transformation and customer experience, transformation, blah, blah, blah, blah, blah. At a certain point, the leaders inside of a company are saying, "Enough, we have transformed enough. We went from the cater-

Jim Marous (27:24):

We've made it.

Jacob Morgan (27:25):

We went from the caterpillar to the butterfly. Now you want me to go from the butterfly to something like, how many transformations can we take on at the same time? And that's very true. I mean, think about it. In your personal life, if you had to keep going on these transformations all the time and keep investing money and time and energy, you'd be burned out.

Jacob Morgan (27:41):

At a certain point, you're like, "Enough, I don't want any more transformations." So, what's far more valuable and scalable is to have a transformation mindset. And what that means is you make gradual improvements over time instead of doing these really big projects.

Jacob Morgan (27:59):

So, for example, let's say that you are in banking, and you have customers that you work with, and you see that you have maybe outdated procedures for how you meet with customers, how you deliver projects, how you communicate with customers, how you track certain things, whatever it might be. And these are policies that've been around since the 80s or 90s.

Jacob Morgan (28:23):

The idea now is don't wait to a point where you get there and you say, "Ah, we got to transform everything." The idea is as these things come up, point them out and adapt. So, you need to encourage your employees to speak up and say, "Hey, I was meeting with so-and-so, and I realized that this is kind of like an outdated way to do this. Is it okay if I just change it and do it like this instead?" "Yeah, sure. Go ahead."

Jacob Morgan (28:46):

That's a transformation mindset. Being able to make those improvements. There's a quote, I think it was Ben Franklin, “Small oaks fell, or no, small strokes fell great oaks.” Meaning small improvements over a long period of time can yield to great impact. If you improve by 1% a day, by the end of the year, you'll be 37 times better.

Jim Marous (29:09):

Atomic habits. Atomic habits. Exactly.

Jacob Morgan (29:09):

Don't wait for this like, "Oh, we got to transform everything," do these things in the now. If you're thinking about how you engage your employees, if somebody comes to you and says, "Ah, our policies here are a little outdated, or why do we need to kind of expense this or expense that?"

Jacob Morgan (29:26):

Don't wait a year or two years before you recreate your whole engagement strategy. Do those transformation things now, make those quick changes. Encourage your employees to speak up, encourage people to challenge you, encourage people to ask questions, to challenge convention and create these quick, simple, small, and agile processes where you can just go, instead of doing these whole big projects all the time.

Jim Marous (29:53):

It’s interesting. You said it here too, as a leader then you have to be able to accept those things you asked people to do. So, it's again, that transformation mindset. I look at ChatGPT and all the dynamics that come with that. It's making learning easier, but it's also making learning required.

Jim Marous (30:12):

Because in one sense, ChatGPT is getting smarter and smarter and smarter are you. On the other hand, because it's getting smarter and smarter, you can utilize that as a tool for continuous learning that makes you better every day.

Jim Marous (30:27):

And you talked about it before the podcast. You're writing books on an ongoing basis, you're writing white papers, you're doing all this. Well, part of that's to make money. Part of that's to educate the populace, but part is also to educate you. Because those elements make you learn what's going on and what's changed since the last time you wrote a book. And it’s extraordinarily important.

Jim Marous (30:48):

I think we rest on our laurels and in banking, it tends to be easier than some industries. Because right now at least there's less penalty for not doing so. But we're an industry that is living off of now composable solutions, which are small solutions that can be implemented to solve major problems that are time-based, that can be implemented quickly and easily.

Jim Marous (31:10):

And the beauty of that is it allows you to continuously transform. It allows you to not say, "I'm going to do a core transformation." No, it says I'm going to change the new account opening process, or I'm going to change what the screen is on the mobile app.”

Jim Marous (31:25):

So, let's take a short break here and recognize the sponsor of this podcast. But we're going to get back to the ChatGPT, we're going to get back to the learning mentality and also about how executives can become more like futurists. So, we'll get back to that as soon as we hear from our sponsors.

Jim Marous (31:44):

Welcome back to Banking Transformed. So, I am joined today by bestselling author and noted leadership expert Jacob Morgan. We've been exploring the challenges, opportunities, and strategies that banking leaders must embrace to become future ready for themselves and also for the employees.

Jim Marous (32:01):

So, Jacob, before the break, you were talking a lot about being prepared for what's coming up in the future, being prepared for change, continually educating yourself and having a transformation mindset.

Jim Marous (32:12):

You advise leaders in your recent white paper to think like futurists, which is interesting because many leaders tend to fall to the, "I've done it, now I can live off my laurels that I've done so well." How can executives apply scenario planning or embrace an innovation mindset to stay ahead of, or at least keep up with change that's all around us?

Jacob Morgan (32:40):

It's a muscle. Probably, the best analogy I can think of is chess. And so, what separates a more amateur, novice chess player from a chess player who's more seasoned? And there are many things, but one of them is the ability to think in terms of scenarios instead of thinking in terms of single paths.

Jacob Morgan (32:59):

So, an amateur player, like for example, if I'm teaching my daughter how to play chess, she's seven, she'll move her pawn or something and I'll say, "Well, what can I do?" And she'll say, "Well, you're going to move your bishop." And she thinks in terms of single moves. I make a move; you make a move. I make a move; you make a move.

Jacob Morgan (33:17):

What a lot of more seasoned players think is they say, "Well, if I move my pawn, you have a couple different things that you could do. You could move your pawn, you can move your bishop, you can move your queen. And depending on what you do, I'm going to think of different options for each one of those different possibilities.” That's what this idea of thinking like a futurist actually is.

Jacob Morgan (33:35):

And a lot of people think that this is some kind of a fun title that you can slap on LinkedIn, but you can actually get a certification in foresight. You can get a master's degree in this. So, I went to the University of Houston to get my professional certification in foresight.

Jacob Morgan (33:50):

And what this does is there's a series of frameworks and processes and exercises that you can go through to help you think about different scenarios and possibilities that might come in the future. And one of the most famous ones, the most useful ones, and my favorite one that I sometimes go over with CEOs is called the cone of possibilities.

Jacob Morgan (34:09):

And the cone of possibilities is this really cool visual that allows you to think up different scenarios that might happen. So, imagine, for example, that you're looking through the narrow end of a cone. Maybe it's like one of those orange cones, those parking cones that you find out on the street and pretend that you pick it up and kind of you look through the small hole.

Jacob Morgan (34:30):

Now, the way that you visualize this cone is that what's closest to you is the nearest time horizon. And the farther out in the cone that you look, the farther the time horizon becomes. Now close to you the cone is very narrow. So, there's not that many possibilities, and there's not that many options.

Jacob Morgan (34:47):

But the farther out in the cone that you look, that's the longer time horizon, the wider the cone becomes, and the wider the cone becomes, the more space there is, the more possibilities that there are for different things to happen. And this is very irrelevant because a lot of people might know what happens tomorrow, next week, next month, maybe through the end of the year.

Jacob Morgan (35:06):

But if somebody were to say, "Well, what do you think is going to happen to your business in two years, in three years, in four years, in five years," all of a sudden it becomes very, very fuzzy. And so, going through this exercise just helps you think about some of the things that might be possible. And there are four questions that I think they are very useful for executives to go through.

Jacob Morgan (35:25):

So, the first is asking yourself — so first you write down a scenario that you think might happen. So, let's say we think of automation, automation in terms of banking. And I think ChatGPT's going to come by and it's going to replace 10 million jobs in banking. Like 10 million employees in banking are going to lose their jobs. So, that's one scenario.

Jacob Morgan (35:53):

Now, you might ask yourself, "Well, why would that happen? What would cause that to happen? What would cause 10 million banking professionals to lose their jobs in the banking sector with technology?" Probably a few things would need to happen. So, number one, something like ChatGPT would need to continue to grow in advance. Maybe it would be a ChatGPT 6.0.

Jacob Morgan (36:16):

Number two, a lot of executives at these banking organizations would have to say, "Yeah, we don't need people anymore. Let's bring in the bots." Number three, we would have to stop with any kind of training and development programs.

Jacob Morgan (36:27):

Number four, these individual employees would have to say, "Yeah, I'm not going to invest in any time and training and development. I'm okay to get replaced." And so, you think about that scenario and you're like, "Well, those things are probably not super likely." So, then you ask yourself, "Well, what else might happen?"

Jacob Morgan (36:44):

Well, another scenario … and again, what else might happen? You can think of maybe 2, 3, 4, 5 other scenarios. Maybe another scenario is that certain aspects of your job get automated, but you as a human stay in the role, you stay in the company but some of the work that you're doing is now augmented by AI. So, that's kind of the second question you asked, “What else might happen?”

Jacob Morgan (37:06):

The third question we kind of alluded to as I was talking about the first one is, what are some of the factors that that would influence why something will or will not happen? So, imagine you have your one scenario, now you ask yourself what else might happen? Now you have these other scenarios. Now the third question is, what might impact why each one of these scenarios will or will not happen? And you kind of write all those out.

Jacob Morgan (37:28):

And then the fourth question you ask yourself is, what do you actually want to happen? Because one of the things that we forget is that the future of work isn't something that happens to us. The future of work is something that we can shape and design and create and build.

Jacob Morgan (37:40):

And one of the things that a lot of leaders struggle with is they ask, "Well, what is the future going to look like? What is our business going to look like?" But the reality is, they should be saying, "What is the future that we want to happen? How are we going to make that future happen? What do we want our business to look like in this technology driven world? And what steps are we going to take to make that future a reality?"

Jacob Morgan (38:00):

So, I think if a lot of executives can visualize that cone, they can ask themselves these four questions. And you can bring in a futurist that go through multi-day workshop. I mean, there's a lot that you can do with this. But at least for yourself, just ask these questions, play around with these different scenarios, talk to your team, and you can start to see what sorts of things might come up and build that as a muscle. And it might sound silly but learn how to play something like chess.

Jim Marous (38:28):

Well, it's interesting because that really gets into the whole aspect of building resilience, which now more than ever, if you're not prepared for different scenarios, you're unprepared. Now that sounds logical, but the reality is the impact is so dramatic.

Jim Marous (38:42):

I mean, we look in the banking world, interest rates have gone up after not moving for 5 to 10 years. We have savings accounts now being more important because interest rates have gone up with a whole line of executives being hired that have never looked at new rates every week, or the way I used to as a management trainee, looking at the dynamics of what does that impact generative AI.

Jim Marous (39:06):

I mean, generative AI in a day changed the entire industry and humans because they could actually use it going forward to change the way they look to the world. And speaking of generative AI and ChatGPT, obviously they're changing everything around us. What opportunities and challenges do you see from the executive perspective as to how generative AI and ChatGPT not only gets deployed, but how organizations get ready for the potential such?

Jacob Morgan (39:39):

I see tons of opportunities for leaders across any industry even if you're in banking. I mean, you'd be surprised the types of things that you can put into ChatGPT to get help. For example, you can go into ChatGPT and say, "I have this employee who works for me. He is in customer service, he's really good at people skills, he's really good at marketing, he's really good at things related to emotional intelligence. But he's looking to transition into a role that's a little bit more focused on analytics.

Jacob Morgan (40:17):

He has some high-level understanding, but he really wants to do a deep dive into analytics and shift into that role in the business. Can you come up with a six-month training program for this employee with recommended topics and courses and an outline of how he should spend his time each day, max two hours a day to learn how to upskill and retrain himself so that he can make this transition. And please give me links to any relevant courses that exist online that he can take."

Jacob Morgan (40:54):

And ChatGPT will give you a personalized training solution that you can give this employee to help him move from his role in customer service into a role in analytics. Now, if you think about what that required in the past, it was enormous time intensive resource, probably required meetings, getting together teams, doing research online, looking at the different pro — I mean, it was-

Jim Marous (41:22):

Consultants, I mean, yeah.

Jacob Morgan (41:22):

Consultants, yeah.

Jim Marous (41:24):

Nobody had all that skillset in their minds. You have to go to people that do that for a living.

Jacob Morgan (41:31):

So, now you can see these types of amazing things that you can do with ChatGPT, I'm preparing for a one-on-one meeting. I'm preparing for a one-on-one meeting, upload a previous performance appraisal into ChatGPT and say, I have a one-on-one meeting with this employee, help me prepare for it.

Jacob Morgan (41:50):

What are some good questions I can ask this employee because I want him to excel in these three particular areas, or I want to put him or her on a leadership track over the next one or two years. Give me some questions that I can ask and some topics that we should discuss or give me a template. I want to evaluate my employees.

Jacob Morgan (42:07):

I want to have a performance appraisal template that I can use that focuses on these key areas of people management, of analytics, and on customer service. They'll give you a template. Having this kind of an assistant, having this kind of a resource is enormously valuable.

Jacob Morgan (42:26):

Let's say you want to send a message to your team. And let's say you want to send a message to your team and maybe you drafted an email, and you want to get improvements on that email. So, you might go to ChatGPT and say, "Hey, this month or this quarter, my team, we didn't meet our numbers. And so, I want to draft an email to my employees, which highlights a couple things.

Jacob Morgan (42:53):

I wanted to highlight the need and the urgency for us to make sure that we can meet our goals next quarter. But at the same time, I also want to acknowledge how hard my team has been working. I also want to let my team know that I am proud of the work that we did, and that even though we fell short of our goals, that I'm very optimistic about what the next quarter could look like. Help me draft that kind of an email that conveys those points.”

Jacob Morgan (43:20):

And you can either maybe input something that you've already written or ask ChatGPT to create something for you. And you'll be amazed at the types of things that it can create. So, having this kind of a smart assistant, I think is invaluable for leadership.

Jim Marous (43:33):

It can look for gaps. You mentioned about the employee appraisal plan. You can say, "Here's our current employee appraisal plan, if you were to improve this to make it so it's more dynamic and ready for what the future brings, how would I look at doing that? Show me what it should look like." What's interesting, it may not give you the answers, but it may show you some blind spots. I’ve found that to be the most innovative and most exciting part about generative AI and ChatGPT.

Jim Marous (44:01):

Is I give it an article topic I'm going to write, and it helped me look for things that I wasn't going to write about, but I said that's an important component of what I was going to do. Heck, I use ChatGPT to prepare for this podcast. I say, "What should my introduction be? What are some questions I should ask based on what you've written and what I've learned?"

Jim Marous (44:20):

And as I said, your ability to say it may not be perfect, but to be that great assistant that can look for the gaps. Lee and my team know that we have this person that was on, it was an author that wrote a book with 32 different people.

Jim Marous (44:35):

And those 32 different people each had a chapter. And he asked ChatGPT for each of these chapters, if you're going to write — only give it a one-star review, why did it only get one star? So, as opposed to saying, "How can I make this better?” It said, "What happened here was my blind spot.”

Jim Marous (44:53):

Which you can accept or not accept. And as you know for people that say, "Oh, I don't believe in ChatGPT, I don't need it." The reality is you may not like it because you weren't asking the right questions. It really helps in asking those questions.

Jacob Morgan (45:09):

Tremendous value.

Jim Marous (45:10):

Jacob, as we're looking to finalize this podcast, two things come to mind. One is, what do you see as the biggest gap in leadership today based on where you think it should be?

Jacob Morgan (45:24):

Biggest gap is this idea that we talked about at the very beginning of combining leadership with vulnerability, competence with connection. I think we're very much forgetting about the performance and the leadership aspect. And I hope that 2024, that's going to be the big trend that we bring back.

Jim Marous (45:41):

The second question is, if I was wanting to become a leader, and I'm not one right now, and I want to find the way I can become a better leader, where do I focus my energy?

Jacob Morgan (45:53):

Well, number one, you don't need anybody's permission. You don't need to ask anybody for anything. You can decide to become a better leader and learn the things that you need. I think there are a lot of great resources out there. I'd like to think that I can contributed to some of those resources with some of the books that I've put together.

Jacob Morgan (46:08):

But there's leadership books, there's podcasts, there's articles, you make the time and make the investment into becoming the leader that you want to be. Probably the best thing that you can do is surround yourself by other leaders at your company, number one.

Jacob Morgan (46:22):

Find the leader inside of your organization who you would like to emulate. Try to get some time with them or watch them, observe them. Pay attention to how they lead meetings, how they talk to people, how they make decisions, and just observe. You have a lot of leaders in your company. You have a lot of leaders that you're surrounded by every single day. Pay attention to both the good ones and the bad ones and what's working and what's not.

Jim Marous (46:46):

Well, it's interesting because ChatGPT can help you with that too. If you're a public company and it's a leader that's prominent in the industry, you can actually ask ChatGPT, “How can I become like this person?” It is crazy. What it comes up with and how on spot it is because it's the same dynamic, it's the same question, it's the same inquiries no matter who the leader is. A lot of the stuff is consistent.

Jim Marous (47:10):

So, Jacob, again, thank you so much for being on the show. I always enjoy our time together. I also realize you are the king of content. I mean, I feel like I'm putting out stuff all the time, but you always have emails, you have podcasts, you have presentations, you have LinkedIn posts, you have your books and your white papers. How do people stay in touch with what you're doing and the dynamic nature of what being a leader means today?

Jacob Morgan (47:38):

There are a few resources. So, one we talked about this new PDF people can go to topleadershiptrends.com and download the PDF. I like to give people my email, which is [email protected]. I also have a podcast. All my socials and all that stuff is available at thefutureorganization.com.

Jacob Morgan (47:55):

But I also try to share some things on a Substack column that I have, which is greatleadership.substack.com. And then people are interested in the book, that's just leadwithvulnerability.com.

Jim Marous (48:06):

And obviously Amazon every other way. But Jacob, you're a wealth of resource, you're a wealth of information, I should say and really enjoyed the conversation. And I'm a person that continues to beat our own industry up that I don't think our industry has leaders that really changed their industry and their organizations enough.

[Music Playing]

Jim Marous (48:28):

And for our industry, the place where I'm finding the best leadership are at the smallest and the biggest organizations. It's those in the middle that sometimes use the excuse of, "I don't have enough money, or the regulations don't allow me."

Jim Marous (48:41):

And on the other hand, they're going, "But I've had 23 amazing years of success. Why should I mess with it?" Well, it depends on your personality a lot of times, it doesn't kill you. So, Jacob, thank you again. Tell your wife I said hello and congratulations on all that you guys are both doing.

Jacob Morgan (48:59):

Thank you very much. Thanks for having me.

Jim Marous (49:03):

Thanks for listening to Banking Transformed, the top podcast in retail banking and the winner of three international awards for podcast excellence. We appreciate the support we've received to make this endeavor a success. If you enjoy what we're doing, please take some time to give some love in the form of a review.

Jim Marous (49:20):

Finally, be sure to catch my recent articles on The Financial Brand and check out the research we're doing for the Digital Banking Report. This has been a production of Evergreen Podcasts. A special thank you to our senior producer, Leah Haslage and our audio engineer and video producer, Will Pritts.

Jim Marous (49:36):

If you've not already done so, remember to subscribe to Banking Transformed on both your favorite podcast app and on YouTube for more thought-provoking discussions on the intersection of finance, technology, and leadership.

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