Ron Shevlin’s Post

This is one of the biggest challenges in financial services, and I talk about it all the time. For community FIs, the gap between status quo and long-term relevancy is vast. Tech talent/resources are perceived as “expensive” only because small FI’s simply never invested in it at scale before (and they have trouble comparing that cost to the cost of doing nothing). For engineers and other tech talent, working at an FI can be a huge career accelerant if the right (innovative) leadership is in place. So many opportunities to bring a prehistoric tech stack into modern times.

Heard this from a few people I’ve met through American Bankers Association . I agree many banks can’t afford the Silicon Valley tech talent. However they still have good talented IT and Operations folks, and they can work with vendors with delivery and success teams that can deliver the desired outcomes the bank is looking for; even in AI. Lightico has always been ready to step up. Are the community banks really ready?

Ron, I tend to think banks (big and small) need new business models, not new systems people in their IT departments. I struggle to see what young IT professionals operating legacy systems within a 100-year-old business model will do to make a difference. A group of committed bank executives, board members, and consultants might engage with a few bank IT professionals to commit to developing and testing some new business strategies. This could be a game-changer. It's not the missing IT professionals who are preventing this from happening. In my experience, it’s the missing board members and senior executives. Perhaps I’m misunderstanding what threatens banks today.

Thanks for sharing the article, Ron Shevlin Your commentary about the lack of affordability for those key positions within smaller community financial institutions. We can talk tech talent all we want, but will CEOs be willing to pay someone more than they're making? As you said, the key getting vendors/partners to better scale their offerings. #technology #communitybanks #creditunions #strategy

Exactly! About to publish a research piece proving this quantitatively, using mentions of AI on transcripts and total assets: Correlation, linear regression; comparison of the median assets of those that mentioned AI versus those that did not; and a two-sample t-test of mentions by community banks versus larger banks. They all say the same story.

All the cool IT kids cannot wait to get that job where they learn about COBOL. Slay!

Ron Shevlin this is exactly why we created HiFin. We’re here to partner closely with FIs to reach the technical goals that are difficult to staff for. There’s a careful path to walk when it comes to data and AI. Advanced techniques are required to comply with data security and that means data more than likely cannot leave the institution. We know how to solve that, but the talent barrier is still high, even for HiFin. If they can’t invest in the talent (their own or through a service partner) then we can never put the butts in seats this type of work requires.

Stop laughing? I still laugh. Most bank buildings are old and decrepit and many of their OG investors and account owners like them that way. The likelihood that even the biggest banks would demolish or remodel their ancient artifacts when most of the people who have large swaths of wealth in them are those who have banked with them for 50 years. Add on to the fact that the Millennial generation and now Gen Z are the brokest generations that have ever existed...myself included. Perhaps the financial institutions need to rethink their entire outdated credit models and adjust to meet a more modern world. Got to love how auto loan companies and numerous other companies still use like FICO 6 when FICO themselves have models that are 8, 9, and 10, as well as other models such as Vantage exist is exhausting. If FI want to entice the younger generations why not actually help them get out of school debt and or help them finance their school careers since they own the financial institutions that finance those loans? Or perhaps another idea that would likely cause the entire financial industry to crumble or wince in terror, stop allowing residential housing to enter the stratosphere in cities where the wages don't match.

I think the industry and the applicants would benefit from taking an almost "startup" point-of-view to tech careers in community banking. Compared to enterprise "mega" banks, community banks face many of the same challenges - and opportunities. (Fewer resources but less bureaucracy. Smaller teams, but greater collaboration. Etc. Etc) I attended a Finovate roundtable - many moons ago - where Kimberly Kirk shared some incredible digital transformation work her team was doing at Queensborough National Bank and Trust Co. around fraud and disputes. If I recall correctly, fostering budding tech talent contributed to some of that success, something frequently seen at successful start-ups. If veteran tech talent is cost-prohibitive - hiring AND empowering emerging (more affordable), entry-level tech professionals can go a long way to injecting innovation in banking! 🙌

Here's another perspective - It's tough to make the case to move someone out of the business that's been at the bank for 20 years to make room for a young new hire that's going to command a higher salary than said individual. It may not be something they talk about but I would wager many bank leaders struggle with justifying that move. However, there are some good examples of CFI's making key hires that actually DO transform the bank. I'd put up Colony Bank and their hire of Christian Ruppe as a great example.