Developing the Next Generation of Leaders The Value of Relationship Building

Martin Hyman of People's United Business Capital interviewed four well-respected and successful industry leaders about how we can educate and attract the next generation of assetbased lending leaders. Listen carefully...

THE PARTICIPANTS

Bruce Sprenger

Group Senior Vice President-Midwest Regional Executive

Bruce Sprenger joined Cole Taylor Business Capital in 2008 as group senior vice president responsible for developing new markets, branding and strategic direction.

Formerly with LaSalle Business Credit, his experience spans virtually all aspects of leadership in commercial finance. At LaSalle, he opened a de novo regional office and several satellite offices and went on to manage the company's central US region. Sprenger later launched LaSalle's European crossborder product and global asset-based lending( ABL) connectivity with ABN AMRO. He was also responsible for all North American non-credit product cross-sell initiatives and managed the unit's marketing, sales, communication and branding activities. Sprenger is Past Chairman of the Commercial Finance Association (CFA). He has done training and education on secured-movable asset financing in Central America and China on behalf of the CFA.

Michael lladdad

President NewStar Business Credit

Michael Haddad serves as the president of NewStar Business Credit. He also serves as a member of the NewStar Financial, Inc. Management Committee.

Haddad joined the company from CORE Business Credit, which was acquired by NewStar Financial, Inc. in November 2010. He founded CORE Business Credit in August 2007 and served as its Chairman & Chief Executive Officer. Haddad has more than 40years of leadership experience in the financial services and banking industry, He has successfully built market share and enhanced profitability at top-tier companies in both independent and regulated environments nationally and internationally on numerous occasions.

Haddad received his B.A. in political science and accounting, and his M.B.A. from St. John's University in Accounting.

He also serves on the Board of Directors of several organizations including the Commercial Finance Association (Chairman) and other not-for-profit entities.

Robert G. Rose III.

Executive Vice President Bank of America Business Capital

Bob Rose is senior portfolio manager for the East Division of Bank of America Business Capital (BABC). In this position, he is responsible for all aspects of client relationships for the asset-based lending business in the Eastern U.S. and Europe, including client retention, revenue growth, and risk management.

Michael Coiley

Managing Director for CIT Corporate Finance, Healthcare,

Michael Coiley is a managing director and business leader for CIT's Healthcare Asset Based Lending unit responsible for providing both financing and strategic solutions to clients in the Healthcare sector. He has been in the finance industry for over 27 years. He is active in the Commercial Finance Association where he presently serves as its First Vice President, is a member of both the Management and Executive Committees and is a past chairperson of both the Education and Convention Committees. Coiley is a founding member of the ACG-NJ chapter and member of both the ACGNYandtheTMA. He has been a speaker at different industry events and has authored several articles for industry publications.

Marlin llyman

Senior Vice President, People's United Business Capital

Martin Hyman is a business development officer for People's United Business Capital. In this position, he is responsible for the New York City and Long Island markets, originating new asset-based loans.

Hyman's prior experience includes 12 years with GE Capital, where he held roles in portfolio acquisitions and corporate lending, as well as experience with Goldman Sachs, Price Waterhouse, and Arthur Yorkes & Company.

He graduated from Brooklyn College with a B.S. in accounting, and earned his MBA in finance from the Stern School of Business at NYU. Hyman also earned his CPA in the state of NY. Heisa member of the Commercial Finance Association, Turnaround Management Association, Association for Corporate Growth and Institute of Management Accountants.

Personal brand and the ability to build meaningful relationships are hallmarks of any successful business leader. Brand is the logo that you own and carry, and the one that lets people know your style in conducting business. Relationship building is an often overused phrase, but one that is critical to developing a network of colleagues and business associates. Styles certainly vary by individual, and one leader carves a path to the top differently than his colleague. The "style" wildcard is what makes it so difficult to craft a one-size-fits-all blueprint to train anyone with aspirations of leadership. The onus is on current leaders to not only attract and identify high potential candidates, but also to understand the individual style of that candidate. This understanding will be crucial to how the leader can go about training the candidate. Then again, we need candidates to train. With a growing age gap in the industry, we need to act quickly to close the gap. (EDITOR'S Note: For more on the human capital gap, see page 26) In thinking about how we educate and attract the next generation of asset-based lending business leaders, I had the opportunity to speak with four well-respected and successful business leaders, to get their thoughts on this important topic: Bruce Sprenger, group senior vice president, Cole Taylor Business Capital; Michael Haddad, president, NewStar Business Credit; Bob Rose, executive vice president, Bank of America Business Capital at Bank of America Merrill Lynch; and Michael Coiley, managing director, CIT Corporate Finance, Healthcare.

What advice would you give young talent in terms of the best career path to becoming a leader in ABL?

BS: Take as many varied assignments as you can in as many disciplines of the business. Your value will be, in part, your diversity of experience. Volunteer in team assignments. You will need to demonstrate a skill in leading and working in teams. Work to be a fair and empathetic coach. No one likes a leader who is a bully. Finally, do something that demonstrates you have a commitment to your community and industry.

MH: Start as a field examiner. Seeing the inner workings of a variety of companies will give you a unique perspective that you can't get anywhere else. This perspective would even be further enhanced if you have an accounting degree.

BR: Spend meaningful time early in your career in each of the primary disciplines; underwriting, portfolio management, and business development. A broad experience base not only gives you more options for more senior opportunities as they become available, but also avoids you being "pigeonholed" internally as a"marketing person" or "credit person."

MC: Invest time in mastering the industry basics, actively seek out an industry mentor and get involved at the CFA Chapter level.

Does your organization have formal credit training, or other programs to develop talent on track for leadership?

BS: We have a progression where we bring folks in at an entry level and move them through operations, audit and beyond. Talent management is key to any organization. Encourage diversity of thinking. Look for leadership traits in not just achieving results, but also in areas that demonstrate diversity and willingness to accept change.

MH: Like most big organizations, we currently do not have a formal training credit program. The cost of maintaining one became a huge issue. We do, however, cross-train all of our staff in a variety of disciplines. For example, all of our account executives have been underwriters in the past. Conversely, our underwriting staff have all been on the portfolio side at some point in their careers.

BR: We have formal training programs, as well as leadership development programs for select individuals. Just as importantly, we have "hands-on" training and mentoring processes that allow younger talent to learn directly from more senior colleagues. The combination of formal and informal training is powerful, and allows us to tailor development programs to the needs and interests of each particular individual.

MC: We have a six-week program covering subject matters such as financial modeling, risk assessment and a review of financial statements. Then individuals are assigned to their respective groups where the training and mentoring continues.

MH: There appears to be an age gap in the industry, What do you do to get young talent interested in our industry?

BS: There is a huge shift in the talent pool coming in the next few years as the Boomers retire and the GenX'ers who have been waiting for their opportunity to lead, take on leadership roles. But that pool is not large enough to absorb all of the boomer exits. Filling in the gaps will be the Millennials. Find out what makes both groups get energized, and focus on buildingyour personnel framework around those concepts.

MH: There is certainly an age gap in the industry. It is very obvious in the middlemanagement ranks. The real issue that this presents is that many of the young talent have not been field-tested when the going gets rough from a credit standpoint. To correct this, we need to recruit early on campus and introduce the ABL product there. We have started, but can do more.

BR: There is absolutely an age gap in ABL and it is one of the most important and perhaps under-appreciated risks facing the entire industry. The industry is full of 25-35 year veterans and, while experience matters, it is only a matter of time until a talent void comes to the forefront. The good news is that this will create a multitude of opportunities in the next 5-10years foryounger people in the industry which, frankly, haven't existed fora while.

MC: We conduct on-campus recruiting at select colleges through analyst programs. For those professionals earlier on in their career, we like to get them enrolled in courses that delve into CFA fundamentals. Get those individuals, who show both a desire and aptitude towards the industry, involved in transactions where they can see the impact of the loans to middle-market companies.

Since relationship building and personal brand is an extremely important part of any leader, what do you do to help young talent develop those relationships and their brand?

BS: Have them take charge of their brand by leading a career of true character. At the end of the day, all the accomplishments have little meaning if you fail to demonstrate trust, compassion and a commitment to doing the right thing. When we launched our business, we had the challenge of building a brand. Our success was tied to our ability to attract teammates we could trust and then leverage our personal brands and reputations.

MH: First and foremost, get involved with the CFA. Start with the local Chapter and then get involved at the National level to complement the brand building. Then, depending on your area of interest, complement that with attending TMA, ACG or other organization events.

BR: Building one's brand is incredibly important for junior talent. I preach to our younger talent that, while the organization has a responsibility to train and develop, it is up to each individual to promote themselves and to be actively engaged in the training made available. I urge my more junior colleagues to meet as many senior people in the organization as they can within both the asset-based lending business and in other parts of the bank. Also, they should be a voracious learner by listening, asking and reading as much as they can. Lastly, they should "force" their way into client meetings whenever possible. There is no better experience in building relationships than by observing others with vast experience.

MC: We need to help young professionals refine their relationshipbuilding skills in a business environment. They can refine these skills by watching and listening to their more seasoned colleagues and mentors, but they need to be active in order to internalize. The more interaction with colleagues, clients, prospects, referral sources, and the more open they are to learning, the more they'll refine their style and start to build their own network of relationships.

It is easy to see the challenges in building the next generation of leaders. Though there are many important inputs to the equation, relationship building and brand development will be the keys to their success. Identify talent early on and then monitor their careers as they develop. Be willing to adjust and adapt to each candidate's own style. Most important, provide them with real experience by having them watch their senior colleagues in both internal and external meetings. Then give them an opportunity to run a meeting. Provide real time feedback and teach them to not be afraid of asking questions. Help them broaden and deepen their network by identifying industry associations to get involved with, and encourage active participation in community. Lastly, let them design theirown individual brand. After all, their brand will be the identification card needed to gain access to the rank of leader, tsl

It is easy to see the challenges in building the next genera tion of leaders. Though there arc many important inputs to the equation, relationship building and brand develop ment will be the kegs to their success. Identity talent early on and then moni tor their careers as they develop. Be willing to ad just and adapt to each candidate's own style. Most important, pro vide them with real experience by having them watch their senior colleagues in both internal and external meetings. Then give them an op portunity to run a meeting.

Martin Hyman is a business development officer for People's United Business Capital. In this position, he is responsible for the New York City and Long Island markets originating new asset-based loans.