Find Your Leader

When it comes to finding diverse leadership, it's not as if banks have ever lacked influence at w. or near the top from someone other than a banker. After all, outside directors at community banks come from a wide range of backgrounds. And it's not as if community bank CEOs have all come with long histories in banking. Look around and you'll find that you have a former lawyer at one bank, a former accountant at another, who now serves as a bank president. So, as banking continues to evolve, even down at the most local community bank level, has the industry decided, for instance, that if you are going to play a salesman's game, that you should hire a salesman as your new CEO? That if a broad financial services lineup is in your future, that an insurance man belongs at the top? Not likely, is the resounding answer of consultants, recruiters, and bank CEOs interviewed for this article. Community banks recruiting outside of banking is still extremely rare, says Dr. Douglas Austin, the Toledo, Ohio, banking consultant. Part of the practice of his firm, Austin Financial Services, Inc., includes assisting banks with senior-level recruiting and management succession. Bankers still hire bankers, says Ben Cole, head of the Ben S. Cole Financial Inc. consultancy, based in Boston. All say that this practice is not an instance of being tradition-bound, but a matter of practicality. A great deal of what community banks still do is traditional commercial banking and that can't be run by a neophyte. In a community bank you've got to have experience at the top, explains California community banker Jim Ryan. That's because you don't have the big staff of experts to fall back on. You've got to be able to decide on your own if things are good or bad. Ryan is chairman of Bank of Walnut Creek, Walnut Creek, Calif. are CEOs and boards looking for in potential candidates? Peter Ostrowski, consultant with Ostrowski & Co., N.Y.C., says the boards he works with place a high value on the strategic thinker, a banker who not only knows where he or she wants to go, but who has an idea where a community bank they become part of ought to go. Several consultants point out that, more and more, banks are seeking a highly diversified background. They want more flexibility, people who can do more than one thing, says Jon A. Doukas, senior consultant and principal at Professional Bank Services, Inc., Louisville, Ky. With the layoffs that large and mid-sized banks have experienced, it would seem that the field would be flooded with but some executive recruiters say that the opposite is actually the case. It's tougher to find good, well-rounded candidates, says Jay B. Adams, president and owner, Adams Select Staffing, an Omaha, Neb., recruiting firm. Adams explains that many pushed out of larger banks may have had years of banking experience that's too specialized for a community-bank CEO. We're largely generalists and some of the city bankers are so specialized that they can't be generalists anymore, says a midwestern community bank CEO who's just beginning to think about succession planning. And some big bank refugees, observes this banker, haven't had direct customer contact in years. Consultant Doug Austin says the winner of most banks' CEO talent search is still the outgoing person who feels comfortable with the many public roles that a community bank CEO plays. guy who's generally not going to make it is the computer guru, says Austin. Ultimately, for any organization, the selection of the ideal management succession candidate comes down to a single question: What must this company do well in order to succeed? This is according to the Report of the National Association of Corporate Directors Blue Ribbon Commission on CEO Succession, released in 1998. The commission went on to identify six questions: 1. …