Editor's Note: This feature originally appeared in the September issue of MReport.
When you hear the words disruption, innovation, and technology futurism, they are not often associated with the mortgage industry. The word innovation has been so diluted over the years that it seems to have lost all meaning. From a startup perspective, mortgage companies say they want innovation, but this is simply empty rhetoric. From a mortgage veteran perspective, established customers, solid bases of revenue, and a disciplined risk management model do not make for innovative friendly environments. The word ‘innovation’ sounds like a dirty word, or at the very least, an inconvenience.
That may seem a little harsh, especially considering I work on the other side of the aisle in startup land and this article sounds like it may take a predictive turn. “Startup youngster wants to disrupt the mortgage industry!” “Baby boomers are out, millennials are in!” While that is one narrative that may never die, thankfully that is not what this article is about.
Thinking innovatively is not just for the young or technology driven. It is for anyone who truly wants to solve a problem, rather than one who only says they do. It may come naturally to some, for others it may be a learned skill. But no matter if you are predisposed to innovate or not, it is a mindset that one must value and practice.
How do we bridge the gap where innovation isn’t associated with being young and tradition is not so deeply rooted it can be toxic?
Value Innovative Thinkers (of Any Age)
Attracting adults under 40 (millennials) will not suddenly make a company innovative, just like ping pong tables or kombucha on tap will not make a company instantly hipster (even though it’s pretty close). It is about true company culture, especially in the day-to-day. It doesn’t matter what your website says if the executive team or the employees don’t intentionally live out the company’s mission or they are not passionate about the products they are selling.
It’s important to remember innovators tend to migrate towards other innovators. Over the years, I have found that I migrate towards people who can keep up with my conversations, don’t laugh off my quandaries about the future, and don’t make me feel silly for thinking the world can be different. You can call me eclectic or odd, but I’ll take them all as compliments. I suppose that is how I found myself working in blockchain.
If the theory of Moore’s Law continues as a theme in technology where change increases at an exponential rate, token innovative departments or handfuls of innovators will not be enough. The speed at which companies can move from isolated experimentation to production implementation will be a defining factor in the survival and growth of traditional markets as technology advances.
However, in order to drive that innovation, companies can’t rely only on the innovative people they have. People with an innovative mindset won’t work for a “turn-and-burn” employee culture if they aren’t passionate about the company. Especially for millennials, their education gives them the privilege of choice. You may think that is a bunch of hooey and it’s just millennial feelings getting in the way, but as the most overly educated generation that has surpassed baby boomers in the workforce, companies can’t afford to ignore it. Why choose to work somewhere where you may be the token innovator, where you have no community, and your voice may fall on deaf ears when you could start your own company or work somewhere innovation is valued?
Not Black or White
Now, this isn’t black or white. There is no one size fits all and this isn’t ‘innovate or die’. This is about having tough conversations with your team, with executives, and with your customer.
My go-to line, especially in our mortgage vertical is, “I have questions.” To successfully understand my customer (in this case, mortgage executives) I need to understand why things are the way they are, what caused them institutionally and how we may come to some sort of middle ground. How can I bring something like blockchain into the mortgage narrative without spooking anyone? This has proven to be a challenge!
At the beginning of my mortgage industry indoctrination, I was surprised by how friendly everyone was. They were eager to share their many years of experience and try their best to explain why things are the way they are. Very different than the expectation established in my mind from The Wolf of Wall Street—the “too-big-to-fail,” recession-causing industry reputation that many millennials graduated into. Not only did I have to change my perspective that we were we going to disrupt an entire industry, but I have also grown to respect the many facets of the mortgage industry. I did this by intentionally asking questions, finding multigenerational mentors, and listening more than I talked.
In order to truly understand the marketplace, we have had to listen and adjust our plans for what the market really needs. Turning a blind eye, or not engaging in conversations with the intent to learn from them, not just check a box, will cause companies and whole industries to fall behind.
Don’t Be Driven by Fear
Ideally, companies aren’t about surviving. They’re about thriving by way of moving forward, and simply refusing to stagnate. No one thinks they will get ahead by remaining the same as they always have. As the workforces changes, so does the consumer. With the adoption of cryptocurrency, nontraditional lending, and on-demand commerce, consumers are embracing applications of evolving technology to meet every need. From my point of view, startups are able to move quickly because they don’t have as many hoops to jump through and there is less infrastructure in which everyone wants a piece of the pie.
The mortgage industry must embrace innovators, not ostracize them, because we need each other to understand and to move forward. You don’t have to go as far as Google where employees are allowed 20 percent of their time to work on side projects, though this has brought about some of the decades most innovative products: Google Maps, Twitter, and Slack. Take a field trip to a startup, play some ping-pong with them. Start a book club that creates a safe space for conversations about innovation. Get a company Toastmasters Club going where you can practice your speaking skills and pitch world-changing ideas.
Think of innovators as another kind of diversity. Innovation is inclusive and considers many viewpoints. Hiring traditionally diverse teams doesn’t matter much if the team, company, or even industry chooses the same path forward. The point isn’t to check the ‘innovative box’ on your to-do list. To truly embrace and become innovative, your mindset is must be one of curiosity, a desire to learn, and a willingness to make smart risks in the short term for an exponential long-term payoff.
We are all flawed humans, doing what we think is best, the best ways we know how. It doesn’t take a huge leap to become innovative, it starts with a small step. Because you can’t know what you don’t know, the first step is simply asking the right questions. So what are the right questions? And what is the next step toward innovation? Start by embracing and valuing new ways of thinking, and avoid fear-based decision making. Hire multigenerational innovative thinkers, support employees’ personal values with your company values, and take small risks. You’ll never know where you’ll end up unless you experiment and support inclusive values.
Innovation means you have to see things from many perspectives. Just like we need diversity in our communities to understand different points of view, we need innovators and traditionalists to come together to combine traditional business practices with a fresh spin. In the end, we are better and stronger because of our differences.