#EdInfluence
In his inimitable style, Nick unearths the secrets of good leadership from his guests.
Trusted by thousands of education providers across the country, Browne Jacobson is an award winning national law firm helping clients and partner organisations shape and influence education policy.
#EdInfluence
S04 - E07 with David Beaty
David Beaty never planned on becoming a banker. What began as "practice" for a job interview - while still planning to attend university and become an accountant - transformed into a remarkable 39-year career at Midland Bank and HSBC.
David has since established Bali Consulting, using his experience to provide leadership coaching and consultancy. He was a school governor and trustee of a fast-growing Staffordshire multi-academy trust for over ten years.
What makes a leader effective over four decades spanning economic cycles, technological revolutions, and unprecedented challenges like the COVID pandemic?
He distils leadership success into just seven words: "make brilliant appointments, set clear direction, empower." This deceptively simple framework guided him from managing 50 people to overseeing nearly 900 staff as head of HSBC UK Business Banking.
Listen now to discover how accidental beginnings can lead to extraordinary impact when guided by clear values and consistent leadership.
Let us know what you think of this episode - drop us a message and connect via LinkedIn.
Welcome to the latest episode of Edi nfluence. I'm Nick MacKenzie from Browne Jacobson and today I'm delighted to be joined by David Beaty from Bali Consulting. David, thank you so much for joining me today. I wanted to start by inviting you to tell me a story from your life that would give me a picture of who you are.
David Beaty:Well, first of all, thank you very much for the invitation, Nick, lovely to be with you today. I guess I would tell a story about something that probably had a profound influence on my life. I was doing A-levels at school and my best friend left and joined Midland Bank and a few months later he came and knocked on my door. He was bored and he was missing me, I think, and he said there's a job going. You should, you should come and do it. Well, and at the time I was going to do a levels, I was going to go to university, I was going to become an accountant. That was my life plan.
David Beaty:But I decided it'd be good to go, just for the experience of going to a job interview. So I went along. I didn't own a suit, but I put a tie on. I went along and saw the bank manager and at the end he said have you got any questions? And I said, well, yes, sir, should I leave now, before I finish my A-level? Should I join with A-levels or should I go to university and then join with a degree? And he said to me if you join now, you'll have experience that you won't have if you wait until then. And I was offered the job and I accepted the job and I stayed with Midland and HSBC for 39 years. Ironically, I still see the gentleman who recruited me, Tony Litchfield, who I owe a lot to.
David Beaty:I still see him now for lunch once or twice a year, but I haven't seen my best friend for nearly 40 years.
Nick MacKenzie:Wow, what did you learn over that time of being able to stay in the same organisation?
David Beaty:I would say that I've learned the importance of learning from mistakes that one makes. It's inevitable that you're going to make mistakes in life and in your working career. I think one of the secrets is to make them learning experiences so that you don't do them again. Of course, it's even better if you can learn from the pain and failure of others and observe it and think. I don't want to go through that, but I've learned a lot from mistakes that I've made and I think that's helped me get better at the job that I did.
Nick MacKenzie:And through that time did you ever have frustrations that made you think about leaving, but then you stayed? Because, in some senses, it's quite rare these days to stay in one organisation for so long only twice in my career did I meet somebody even with a concept of leaving the bank.
David Beaty:And the first time I was very interested in leaving the bank. I was only sort of about 20 and it was to be a financial advisor which was just starting to take off. And I went home and I told my father over the tea table I'm going to leave the bank and I'm going to become a financial advisor. Dad and he said okay, that's interesting, son. What's the salary? I said well, there's no salary because it's all commission. And he gave me a piece of advice which was was don't do it. He said because in his experience, the people that I would want to talk to were my friends and family and I'd be trying to sell to my friends and my family if I started to struggle and that would not be a good outcome for me, my friends or my family. So I stayed with the bank and only once later on in my career did I have a conversation. So I never seriously contemplated leaving until I retired
Nick MacKenzie:and thinking of you, mentioned your dad.
Nick MacKenzie:There are there people, piece of advice you've had along the way that really resonates.
Nick MacKenzie:Stand out for you now
David Beaty:the people that I admire most and have taken most from are those individuals who value the people that they work with and who work for them, and I know that everybody says that people is your greatest asset within an organisation. That's easy to say, but if you genuinely believe in that and use them as your greatest asset and treat them in the way that a really important asset should be treated, maintain them, develop them, then those are the people that have the biggest influence on my career and the people that I've listened to the most can we explore values that you, that you think are important, so perhaps personal values, that guide that guided your decision as a leader especially?
Nick MacKenzie:perhaps it's easy to have values when it's all going well, but those difficult moments of course.
David Beaty:I mean that's when the true you perhaps comes out. In those moments of difficulty. It's easy to be wonderful and lovely to everybody when things are going well, but to me, I have experienced good and bad leadership and an awful lot of average leadership in my career and as a leader I aspired to be an effective and a good leader and I think if I achieved any of that, the secret was to was to ensure that people knew that I valued them and people got consistency from me and then I gave them the credit that they deserved for whatever they achieved for me and for the organisation. So it was very much about making sure that the people that worked for me knew how much I valued them. There was self-interest in that, Nick. If I can ensure that people who work with me have a happy environment in which to work, they're more likely to be successful. They're less likely to lead the organisation. That, of course, for me, more successful people who want to be within the organisation as their leader. I bask in the reflective glory of their achievement.
Nick MacKenzie:So just treating people in the right way is there anything over your, over your career, where you've changed your mind about a core leadership belief, something that either knew or dropped, one that you thought was really important, and perhaps you realised it was less important than you thought?
David Beaty:One of the things that I think is very important is recruitment. In fact, the number one thing, I think, in terms of leadership importance from my experience is to make brilliant appointments. That doesn't mean recruit only brilliant people, but make brilliant appointments the right person for the right role. Some might have loads of potential, others you need them to do a specific thing, and I also believe a lot in empowerment, and so, as a consequence of those two things, I've made some very bad recruitment decisions earlier on in my career, and some of them I made and some of them I allowed others to make the decisions and didn't validate them enough myself.
David Beaty:And the big problem for me with that is not the problem I've created for myself in recruiting the wrong person, but the problem I've caused for that person. I've made their life difficult. If I've made a bad appointment, they're struggling in the role. I've got to deal with that. But what about them? Nobody enjoys sitting there and struggling, so I learned from mistakes along the way that making sure that I made the best possible appointments and ensured others did the same was really important to me, and that comes through a lot of scars on the back when I got it wrong earlier in my career.
Nick MacKenzie:I wanted to talk a bit about connection and you ended up leading the UK business banking arm of HSBC. So a very large part of the bank, significant number of staff working for you, a huge customer base. How did you stay connected to either frontline your staff or the customers and really keep your eye in on that cold face perspective?
David Beaty:I focused on the connection with my colleagues, and the way that I did that in all of my leadership roles is to have a one-to-one meeting with anybody who wanted to see me. So if I was visiting an area, I would say I'm happy to meet a number of the colleagues individually and I would always ask them tell me a little bit about yourself outside of work. What's important to you, only what you want to share. Tell me about your career to date and tell me about your aspirations for the future. And that was a little structure that I used, and so I would typically in a year have maybe 100, 150 of those meetings with individuals and what comes out of that is an enormous amount of variety, but it helped me learn about the issues because I always finish with is there anything else you wanted to say? Tell me, or questions that you have for me.
David Beaty:And it ensured that I understood some of the problems that people were facing in the business. If one person said it, I would just log it away, but if it was repeated two or three times, I think that's a problem but I need to solve it. Might be that credit are very difficult times. I think that's a problem that I need to solve. It might be that credit are very difficult at the moment or there's a problem with some technology that I wasn't aware of. That gave me the chance to make a difference to people by listening to them, and I've done that from when I did my first leadership role. I had 50 people until I was running nearly 900 people I was responsible for, but I still couldn't see all 900, but as many as I could, I would
Nick MacKenzie:Storytelling.
Nick MacKenzie:How important is that for you as a leader?
David Beaty:For me, if you can Send a message which includes a story and it's relevant to your audience, that will always be more memorable than if it's without the story. The story paints the picture of the words that you are expressing, if you get it right.
Nick MacKenzie:Thank you. I wanted to switch thinking about. We hear a lot about high performance and I suppose we're getting to the sharp end of lots of seasons and everyone's going for those pinnacle moments. But you talked about a long career at the bank. How did you go about sustaining performance both individually over that time but also encouraging your teams to be able to sustain performance and not just hit a peak?
David Beaty:Well, when I first got into leadership, I didn't know whether I would enjoy it. I didn't know whether I'd be any good at it. And so, after going into my first leadership role and taking a branch that was bottom of the league table that we had at the time to second in that league table, and then doing another job and repeating that, and another job and repeating that, so after three leadership roles, each time the business had performed and every time I'd gone in when the business was struggling, and so I must have been doing some things right, and definitely doing some things wrong as well, but perhaps more things right than I was doing wrong. But at that point I reflected why is it going well? What is it that I am doing that is making the difference? And that caused me to think about that and enabled me then to take what I thought were the key, important aspects of successful leadership. For me personally, that worked for me, and every time I went into future leadership roles they were the things that drove me. I made it consistent.
David Beaty:Hopefully and the thing is about the bank environment it's a risk environment and there's effectively, as I looked at it, there's three pillars. There's the way we manage risk. There's the way we manage our customers and there's a way we manage our people each one of those. If you get something wrong, then the foundations are not as solid as they could be. But if you can get the do the right thing by your customers, by your people, and have robust risk management processes in place, you give yourself a chance of sustainable financial success. No guarantee, but a chance that if you make the right leadership decisions on the back of those solid foundations, you've got a chance of having success that is sustainable financially
Nick MacKenzie:So risk. People can tie themselves up in knots on managing risk risk registers um figuring out whether something really is a risk or actually whether it's an issue. What? What have you learned about effectively managing?
David Beaty:risk. Well, the thing is with managing risk. It can be quite boring, but in my experience, in my painful experience if you don't manage risk well, it gets very exciting very fast, and by that I mean very painful, very fast. And I, much earlier in my career probably my first senior leadership role I went into an area that was seventh out of nine in the in the region that I operated and within 18 months it was up to second and I got sent to a, promoted to a larger area, having thought I've done a good job there over 18 months.
David Beaty:But there was a role within that business that was incredible. You wouldn't have it now a people and risk officer. My view at the time was it's all about the people. So I focused all on that and I appointed somebody who was great with people but he didn't know anything about risk and I sort of ignored that aspect of it. I left and within three months the bank did an audit on that area and it failed its audit. And that was due to me. That was my responsibility directly. And the reason we failed the audit is because I had not treated risk with the respect and the time that it deserved. Painful paid the consequences, but learn a serious lesson about just make sure you manage risk effectively, because if you don't, it will come back and bite you very hard and on managing it effectively.
Nick MacKenzie:Lots of people may have risk registers. They go through an exercise, they do, they have their mitigations, they have their rag ratings, but it can be a fiction. Um, they're living in comfort and then the risk perhaps happened to this country with the pandemic, or we thought we were pandemic ready and we found out we were pandemic ready for the different pandemic. What have you learned about making sure that the actions you're taking on managing risk are actually moving the dial or actually of any use?
David Beaty:One of the things that one has to consider is the priorities. In any element of the business that you look at whether it's the people, the customer, the risk, the financial metrics what are your priorities? And I've seen risk decks that have got so much data, so much information 200 or 300 pages which you can't see the wood for the trees. So priorities aren't easy but you need to determine what are the actual fundamental priorities for you in that business that you're operating in that are non-negotiable in terms of risk management. Get those things right first and then reflect onwards from there and you use the example of the pandemic. Sometimes things come out of the blue and hit you from left field and you have to react to it and the circumstance.
Nick MacKenzie:That happens a lot in business, clearly, but generally, if you haven't got that happening, what are the fundamental things that are non-negotiable and you make sure that everybody in your team understands that and operates to that level of expectation strategy, um, strategy, strategic it's a very heavily used word and I always think one person's strategy is another person's operational sometimes but what's your reflections on what you were doing to set the strategy in the tone and what you think is really important for leaders that, when they're embarking on a strategic process?
David Beaty:I told you that I thought the single most important thing was make brilliant appointments. The second most important thing of my three that I have is set clear direction. So if you are the boss or have a responsibility for people in whatever way, then consistency is really important. Then consistency is really important and set in a clear direction is fundamentally important. Alongside that consistency and what I learned was that if I articulated properly the clear direction that I wanted my people to take and I made the right decision on where I wanted them to go, we had a chance at being very successful.
David Beaty:If I got the direction wrong, my problem you know it's my problem we needed to go north, but I miscommunicated and we all went east. My problem Much worse in some ways is I knew we wanted to go north but I didn't get everybody else bought into north. But where it works brilliantly is I want us to go north. This is the guiding principles of how we get there. You all know that over to you as to how we best get to north as fast as we can you mentioned.
Nick MacKenzie:There's a third in your list. I'll come back to that in a moment, but a couple of times already you've mentioned if we do this, there's a chance underneath that I'm. I'm there thinking of that. What's unexpected can happen. You can't have control, you can't guarantee success. Is there anything more?
David Beaty:I'm probably my friends say this is not like you, david. But I'm probably trying to be modest Because once I had it in my mind what had helped me to successfully lead teams to improve performance sustainably, I knew I just got to replicate it, and the confidence that it would work came from the number of times it had worked in the past. So I call it chance. I didn't really see any risk of it failing to be successful. I had that much confidence in the simplicity of the model that I used that I was confident it would be successful Until Covid came along and that definitely knocked me off that particular track. But I don't think I'll be the only one who was knocked sideways by that.
Nick MacKenzie:So what did you learn through COVID then?
David Beaty:How incredibly difficult it was to be a relationship manager to typically between 50 and 100 clients during COVID. If you are a relationship manager in a bank who has 50 clients, typically 10 of them will be doing 10, 15 doing very well, particularly if the economy is going well. The vast majority will be doing okay, could do a little better, struggling a little bit, and a small number hopefully no more than maybe 5% to 10% will be struggling and need a lot of your attention. That's normality in the world of relationship management and banking. Of course, the economy tanks. You've got perhaps a few more that are struggling, but you can see it coming. It comes as a smooth sort of road, gradually more and more customers.
David Beaty:In COVID it happened overnight. So if I got 50 clients, 25 of them were struggling overnight. I needed my support and my time and my attention and I didn't have the time to do that. I'm talking as a relationship manager rather than I wasn't a relationship manager, but I obviously had a lot of relationship managers that were working as part of my broader team. How demanding that was when your customers all want you to be their single most important customer at that time. Every customer has the right to believe that they're your most important customer. You have to manage that. It was an incredibly difficult time and I'm immensely grateful to everybody who worked in the banking industry and more widely for the support that they gave to our customers in my case, hsbc's customers during that period.
Nick MacKenzie:And so shall we go back to the third piece of advice.
David Beaty:Leadership in seven words. Number one make brilliant appointments appointments. Number two set clear direction. Number three empowerment. If you want another word, I don't like it, but don't interfere. If I've recruited the right people, I'm being clear as to where I want them to go. I just need to step away and let their talent take them and the organization as far as it can.
Nick MacKenzie:so empowerment brilliant appointments, clear direction, empowerment and on on the um, the empowerment piece. Then what did you learn about making sure you were really clear in your communication? I think when we we were in some of the information you've given me before today, you could have thousands of people on a, on a call at the bank when you were delivering your, your message. And I think it's something that we've all had to get used to. Um, with the, the different ways of working, the more agile ways of work, where everyone isn't in office all the time and you can't always give your messages face to face. What did you find worked really well for you when you were communicating at scale through digital technologies?
David Beaty:consistency, simplicity. Being concise, you've got lots of things to cover, but if you determine what your main priorities are, they should always be referenced, and it didn't matter whether you were an area director or a junior clerical support member of staff. If I got my messaging right, every single person knew what was my number one priority to take the business to sustainable financial success. So it's about repeating that and repeating it and repeating it. And I had a phrase which I won't bore you with, but it was four words, and I know that everybody in I ran North Region for seven years. I know that everybody in that region at that time could repeat those four words flawlessly without thinking. I just kept saying it over and over again in written communication on calls. I'd celebrate the success of these particular things that were important to me. So everybody knew what was important to me. If I'd have got it wrong, we'd have gone nowhere. If I got it right, then we were going to be successful.
Nick MacKenzie:I should say If you don't mind sharing it. I'd love to know what the four words were.
David Beaty:Well, when I got promoted to my final role, my boss who I had an enormous amount of time for said to me, david, one thing you cannot use that phrase in your new job and I'm allowing you, nick, into a little secret, because I know it won't go any further that after about three months of obeying that order, I changed and went back to it, and the phrase was win switches lend money. Win switches in HSB terminology is win new customers from other banks. Lend money is how banks tend to make quite a lot of the money they do. So all I wanted my relationship managers to do is wind switches lend money. Wind switches, lend money. If any of them have the misfortune of listening to this call, they definitely will resonate with wind switches lend money. Whether it's a phrase that's still used around parts of the bank that I used to work in, I don't know, but I used it for many, many years.
Nick MacKenzie:It clearly worked for you and those that work for you.
David Beaty:I hope so.
Nick MacKenzie:You've mentioned some great leaders along along the way. Is there, is there anyone that you can think of as a leader that you followed? That that really inspired you?
David Beaty:that really inspired you. Well, if I was name-checking one, there's a couple of leaders in my career that I took a lot from. One was a man earlier in my career and one was a woman later in my career, and I'll select the woman who I'm happy to name. Her name is Amanda Murphy, and she was an international manager, and when she came into the UK in a very senior role, what I noticed from Amanda was her ability to connect with people at all levels, whether that be customers or staff, and it was, in some ways, her reputation was quite a fierce one, but her ability to connect, as you put it earlier, with anybody was a talent that I've seldom seen as effectively used as she used it.
Nick MacKenzie:Thank you, seldom seen as effectively used as she used it. Thank you, um. We haven't got an awful um amount of time left, but I would. I noticed, um, in your bio that you were a um, a trustee of an, of a multi academy trust. I was just curious whether you could share some things that you felt that you brought to that role with your, your perspective, but equally, perhaps, what you learned through that experience of of working with the multi-academy trust.
David Beaty:Well, my wife was a teacher and so I had some understanding of the importance that teaching profession and education has on not just children's ability to thrive but the future success of the country. But my eyes were opened by being a trustee, and I was doing that role for about 10 years, and the Multi-Academy Trust went from one school to 20 over that period and was responsible for educating over 10 000 children at the end, and so I I learned a lot of terminology in education that I'm happy to forget, a lot of the ways that measure, some of which are very effective, others, you think, why do we measure success in that particular way? So it was very informative for me and again, the difference a great teacher can make to a child. That's life-changing, and teachers across the country doing that every, every single day. What did I bring to it?
David Beaty:Well, I guess I brought some financial knowledge, and so I remember one time where the school was setting a budget for the forthcoming year and, as ever, the budget was very, very tight from the government, and the view was that we needed to make some members of staff redundant a small number and I said my challenge was why? Because we're otherwise we're not going to make the budget and the point I made was but we've got 100 teachers in this school. When was the last time there was 100 teachers in this school? There's never 100 teachers in this school. You've always got three or four gaps as people have retired, have moved on.
David Beaty:So I said the budget assumes we've got 100 teachers in the school every day. In fact we've got 96. You're talking about making four people redundant. We don't need to, it will just happen. We didn't make any redundancies, we met the budget and we had a surplus at the end of the year. So I guess something like that, where I could just put a slightly different perspective on because of my financial experience maybe as well once or twice, I think I made a bit of a difference and risk management.
Nick MacKenzie:What was your experience of that in the in the academy trust world?
David Beaty:oh, the amount of time and effort that has to go into managing risk now is is immense. I don't understand how really teachers can be completely effective because they have to do so much and they can only do so much. We've all got limited time. I think the hourly rate, the true hourly rate of a teacher is way below the minimum wage, probably because they give so many hours, more than any other profession that I know, outside of their teaching day. They do their absolute best under very difficult circumstances. But I worry a little bit that government imposes too many metrics on schools for them to to meet, and some of those are important risk metrics and others I'm not sure. I think the the amount of time that's given to them is not commensurate with the value that you get from measuring those risks and you're saying that with your banking experience.
Nick MacKenzie:On, when you look at the amount of metrics, yeah, yeah and there's a lot of metrics in the bank for sure so sticking with education for a moment. What quality do you see in young people that you wish you had or had more of?
David Beaty:I was brought up probably to think that success is is measured by material things your house, your car, your holidays. I guess holidays isn't a material thing the things that you've got and you can buy for your family. What I see increasingly in young people is I want the money that I've got, disposable money that I have, I want to spend it on experiences. Experiences for some young people, I think increasing numbers comes before material things. So going on that holiday rather than saving for a bigger house or a nicer car, go into concerts or whatever it might be. I think I admire that, because now I'm retired my life is all about what experiences can I have? I'm trying to catch up on the experience that I didn't have, because maybe I sort of followed a path that many of them won't take and I think they've got it right and I got it wrong.
Nick MacKenzie:Relatively briefly. I just wanted to ask you about making time to think when you're a leader. How did that work for you could? Did you make the time to think, did you struggle to do that, or was it something that you you found a way to do?
David Beaty:people don't like commuting right, but I used to drive an hour into birmingham my last role and an hour home each time. That was if I set off at the right time in the morning and left at the right time at night, but to me that was an opportunity to wind up for work and think about work and to wind down towards home hopefully very different in covid, of course, where you didn't have that period of time. So that's when I used my commuting time. Or if I was in the car driving around the country, I'd make phone calls and I'd talk to people that I wanted to talk about. That that's how I used the thinking time.
David Beaty:But I think the the best example of this might be warren buffett who, um, I saw something and he was having a chat with bill gates and we're talking about their diaries, and bill gates got obviously an electronic diary and he's he shared one day from his diary for the next week and it got like five or six appointments in it. And then he asked warren buffett to get his diary out and he's got a book and he looked for the next week and warren buffett, two appointments, two appointments over five days and he works full time. Still he's 96 or 97. Two appointments. The rest of the time is Warren Buffett's thinking time, and he is probably the single most successful investor in the history of the world, and he ensures that thinking time is prioritized way above everything else. And he ensures that thinking time is prioritised way above everything else. I would suggest that many of us have got a long journey to make before we get anywhere close to doing as much thinking as we probably should and valuing that thinking time and the difference that could make.
Nick MacKenzie:I'm reading a book at the moment. It's got a wonderful title of things you can only see when you slow down. Perhaps that's why Warren can see so much.
David Beaty:He's certainly seen a lot.
Nick MacKenzie:Wanted to just one last question before closing. You've obviously been retired for a short period of time. I understand you, coach, supporting others short period of time. I understand you, coach, supporting others stepping out of the, the heat of the fire of of such a big leadership role. Have you learned anything in that that time? Sort of anything become clearer to you with the support you've been providing since stepping back?
David Beaty:probably that anybody who thinks that they are really important in life, whatever they're doing. Large organizations have to be a continuum. They have to be able to deal with the departures of people for a variety of reasons. So I guess it's just don't take yourself too seriously. Really try to enjoy the things that you do at work and don't take yourself too seriously. What I have missed, and two things that I knew I would miss, were the people and the challenge of the role. The thing I hadn't thought so much about but I am much more aware of now, is what's the purpose in retirement? And to have the purpose in retirement, I think, is an important part of having a happy and successful retirement, and I'm still working a bit on that brilliant.
Nick MacKenzie:Well, I think that's a wonderful place for us to finish today. Thank you so much for joining me, and I've thoroughly enjoyed our discussion, and thank you for sharing with me so candidly, and I'm sure our listeners have enjoyed the discussion as well. So thank you, pleasure, nick thanks very much.
David Beaty:Good to meet you today.
