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Life on the Frontier

The best-seller, Who Moved My Cheese?, has found wide appeal in these uncertain times.

The unlikely best-seller, Who Moved My Cheese?, has found wide appeal in these uncertain times. For those of you unfamiliar with the work, it's a winsome parable about four denizens of a maze, each of whom reacts differently when the eponymous cheese no longer occupies its usual spot. Through cartoon examples, the book shows how one can adapt to change.

However, the maze metaphor implies that we live in an inflexible, walled community lacking sufficient data about our surroundings and sustenance. In reality, we live in a free country blessed with places like Wisconsin and Vermont. We make our own decisions and our own cheese.

Since the metaphors we use affect our actions and perceptions, perhaps it's time for bankers to seek alternate metaphors to describe their worlds. In Connecting the Dots: Aligning Projects with Objectives in Unpredictable Times, (Harvard Business School Press, 2003), Cathleen Benko and F. Warren McFarlan suggest that we use the mental model of an "Information Frontier" rather than consider ourselves as part of an "Information Age." They write:

"An 'age' is something that happens to you, and to which you accommodate yourself. A frontier, by contrast, calls for action."

Although rich with innovation and opportunity, the frontier is a confusing, volatile and unpredictable place, write Benko and McFarlan. Furthermore, people tend to bring outmoded mental models with them to the frontier, to the detriment of both short-term and long-term objectives.

That's why Benko and McFarlan suggest the conscious cultivation of several "traits" beneficial for frontier living: Treat relationships as strategic assets in an "Eco-Driven" approach. Turn transactions into ongoing interactions by adopting an "Outside-In" perspective. Respond at market speed by staying "Fighting Trim." Encourage collaboration inside a "House in Order." By developing such traits, objectives become easier to reach and more adaptable to changing circumstances.

Indeed, explicitly stated objectives often prove illusory on the frontier. For example, Lewis and Clark never did find an effective commercial waterway across what had been foreign territory. However, their expedition has an assured place in history stemming from the value of what they learned, the alliances they forged and the nation they helped to create.

From a practical standpoint, companies cannot colonize the Information Frontier in keelboats or pirogues. Instead, companies set forth with a portfolio of projects, write Benko and McFarlan. Each project has its unique risks and rewards, and ideally, each contributes to the fulfillment of an objective, the strengthening of a trait, or both. To foster the alignment between traits and objectives, effective leaders have to understand the interactions between projects as well as their specifics. It's the application of modern portfolio theory to organizational design.

Taking on the traits of frontier explorers seems more effective than wandering around in a maze. The frontier rewards ambition and initiative. In fact, many of the entries in the Journals of Lewis and Clark begin with something like, "We set out very early this morning." They most certainly did not write, "Who moved my deer jerky?"


A Banker's Dilemma

(Excerpt from Connecting the Dots)

"Markets are becoming increasingly commoditized, even as products are becoming more complex. Nontraditional entrants-even local supermarkets-are multiplying in number and impact. With startling quickness, players in the industry are morphing into entirely new entities, and the traditional walls, both internal and external, are crumbling. In a heartbeat, it seems, the bank's most important partners have also become its competitors. Customers are increasingly doing their homework and demanding products and services uniquely tailored to their needs-and they want these solutions delivered in days, not weeks or months (or years).

"It is clear that the bank's former role-as a prime provider of funds to industry-is fading fast, but the organization's future sources of economic value aren't emerging nearly as quickly. With the future so uncertain, the CEO questions whether the organization's existing set of well-articulated shorter- and longer-term goals will reposition it successfully for the future."

Read Kill It And Grill It, by Ted and Shemane Nugent, for venison and other wild game recipes. Share your stories about the wild game of banking with Ivan Schneider, BS&T senior editor, via e-mail at [email protected].

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