Financial Evolution

Credit Suisse Interview
Brady Dougan of Credit Suisse

In September 2008, the financial world was brought to the brink.  Three years later, we still are left with the question: what happens next replica watches?

On September 19, CEO Brady Dougan came to HBS to help answer that very question, as well as variety of other topics brought up in an open-forum environment by HBS students in a packed Aldrich room.

“We’re not in the land of easy answers.”

What does the future look like? Unfortunately Dougan does not have a crystal ball.  According to Dougan, the global economy still has “structural issues that have to be worked out.”  One of these is simply the uncertainty around sustained public policy in the different geographies.  The indecision in financial regulation makes investors nervous—until these issues are resolved, the risk tolerance of investors will continue to be low.

Irrespective of how structural issues play out //, Credit Suisse has instituted and/or emphasized several key organizational policies which will allow the firm to succeed in the coming environment.

“Get out on these waves of innovation.”

According to Dougan, the financial industry reinvents most of itself every 20 years.  The key to success is thus to constantly innovate, and to treat even the current market environment as an opportunity for growth and enhancing market shares.

Dougan described how, “Pro-cyclical behavior manifests itself in the purest form in our industry, and can be problematic at the peaks.”  His solution is to have long-term perspective of the consequences of his firm’s actions to see beyond the boom and bust cycle—to encourage innovation continuously, and to always question the status quo.

One way that Dougan motivates innovation is the open way in which he encourages employee dialogue.  His policy is to get the “best ideas on the table.  Debate them, and decide which way to go.”  Ideas that seem ‘crazy’ can come from anywhere, but “if you have an idea and a way to drive it, sometimes it’s not so crazy.”  This collegial style encourages openness and teamwork.

‘Over the long run we want 80% of our people to come in on the ground level, develop, and move up the ranks’ [paraphrased]

 Throughout the talk, Dougan emphasized the importance of not being short-sighted.  This belief spread to his Human Resources strategies.  In an industry in which firms tend to prefer lateral hires to internal progression, Dougan wants to redefine the paradigm, and seeks to develop 80% of his employee base internally over time.

Although potentially more time consuming, the benefits of such an action are huge.  Employees will have more loyalty towards Credit Suisse, and thus be more likely to act in the best interest of the firm

“Maximize the potential of people on your team.”

Dougan left the HBS students in attendance with one piece of advice regarding managing a large firm.  The important thing is to manage for the right reasons.  He stressed the importance of developing his employees, especially female employees, through sponsorship, mentorship, and exposure to a variety of business situations.

Brady Dougan became CEO of Credit Suisse in May 2007.  ”One might say my timing could not have been worse given the financial crisis hit shortly thereafter.”    But the firm’s results on a comparative basis—including enhanced market shares and not needing any government support—would suggest that it is fortunate he took on the challenge.