Academic journal article ABA Banking Journal

Controlling Influences

Academic journal article ABA Banking Journal

Controlling Influences

Article excerpt

Anyone involved with farming realizes here are many things that cannot be controlled. A prolonged drought, such as the one currently afflicting most of the Midwest and Great Plains, is an example. Nebraska--where we paid a visit recently--is blessed with a natural source of water, the vast Ogallala aquifer. But in the particular community we visited there is also an impressive network of irrigation canals and reservoirs drawing water from the Platte River. These canals were built before the aquifer was used extensively. While the aquifer is a gift of location, the canals are an example of how people can exert some control over previously uncontrollable factors through foresight, commitment, and energy.

A very similar dynamic is at work with many of the complex and challenging subjects bankers currently wrestle with. At ABA's Leadership Conference last month, bankers heard presentations about the state of the economy, the budget crisis, and changes in the payments system, among other challenges. The economy is probably the single biggest influence on the banking industry. Is it controllable? In the long term, certainly yes. If enough people have the collective will to push for economic change, change will occur. In the short term, the degree of control any one bank can exert over the national economy is nil.

Yet all of us in our own spheres have much greater control over our business destinies than we sometimes realize.

The changes in the payment system-mobile payments, "P2P," etc.--present an interesting example of this. Bankers could respond to these trends by just keeping on doing what they've always done and hoping they don't get run over. …

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