- First Wellesley - https://www.firstwellesley.com/blog -

New England School for Financial Studies – Babson College, May 17-22, 2009

Every year I have the pleasure of teaching at the NESFFS.  My topic is strategic planning.  This May, the Class of 2009’s sixty-eight students graduated from the program after an intense week at Babson College.  We divided the students into twelve teams and each team managed a bank, in competition, for one year using simulation technology.  In addition, each team created a five-year strategic plan.  That’s my area.

During my Thursday lecture on strategy setting, the students completed one team exercise that illustrated why banks in real life are not identical.  I asked each of the 12 teams to identify one core deposit growth strategy.  The teams huddled together to identify their recommended growth strategy.  Interestingly, the 12 teams ended up recommending a total of 9 different strategies.

Remember, the objective was to grow deposits and expand market share.  Teams, during debriefing, presented strategies that ranged from merger and acquisition, new products, advanced technologies, sales and marketing and community outreach.  Ideas included adding business development officers, offering generation-based product families, making deep investments in advanced Internet and CRM technologies and buying a bank.   What was clear was that the teams did not believe that there were only one or two “best” growth strategies to achieve growth.  Each bank viewed the challenge differently and selected different strategies.

Their strategic decision making mirrors real life.  Banks do not pursue identical strategies and do not operate using the same business model.  The variety of responses illustrated that management teams choose different strategies to achieve the same objectives based on a specific bank’s management team, market opportunities, customer mix and core competencies.