Lykken on Lending

In our podcast this week we will have our regulars on to have a Round Table Discussion on “The importance and/or power of HUMILITY in leadership, especially in times like what we are in today.” 

Notes: BOXABL CASITA – Accesory Dwelling Unit

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Hot Topic: The Importance Of Humility!!

It is July 18th, 2022, Monday. We are so grateful to be here with you and to have you tune in to us. It’s great to buy mortgage professionals, real estate professionals, and technology people inside of the mortgage industry. We are so grateful to have you as our audience. Our commitment is to bring you timely information. It’s so good to have you here with us again.

I want to say a special thank you to our sponsors, Finastra Fusion Mortgagebot Solution. It’s a great technology. I encourage you to check them out. We are going to have them on an upcoming episode. Also, FormFree. Their auto check can be used to satisfy Freddie Mac’s reverification of employment. Check out the interview we did with Christy Moss on June 20th. Also, Lender Toolkit. I had lunch with Brent Emler in San Diego.

Some of the things that they are working on are exciting. Brent and Michael were on the show. It’s very interesting and good stuff. You will want to learn more about that. Also, Snapdocs, their eVault solution, makes it so simple to get started with eNotes. It’s so easy to transact across many partners, and doing so, will quickly become a default for your closings. Also, check out the interview we did with Briana Ings on March 28th, 2022. Also, Total Expert. The best in class when it comes to CRMs. It’s a purpose-built CRM. I encourage you to be sure to check it out. Go over there and listen to the interview I did with Josh Lehr.

It had to do with recruiting and how you use the CRM tool for that very thing. SimpleNexus as well. We had Shane Westra on June 27th, 2022, talking about some of the initiatives that SimpleNexus has going on. We are going to have them back on again soon. Special thank you goes out to the Mortgage Bankers Association of America Lenders. Lenders One, the mortgage collaborative success kit. Knowledge Coop, Mobility MMI, Modex, Mortgage Advisory Tools, and DW Consulting for LinkedIn profiles. Give special thank you goes to Adam, and Les. Matt, Alice, Allen, and Jack, my co-host for each one of our shows.

I’m so thrilled to have Jack Nunnery here with me on this topic. Jack, I have been one of the leaders in the marketplace in so many thought leaders in the marketplace. There are leaders and thought leaders. The ones that we are so desperately wanting is thought leadership. In the previous mortgage market update, we talked about some innovations that are going on. We are going to be talking about now is the importance of humility in leadership. What does that mean?

One of the things as a consultant that I am seeing in the mortgage industry of the companies that are doing well and the companies that are not or struggling. There’s one common denominator to both. It’s leadership, the lack thereof or the excellence thereof. It’s important if you look at it. There’s a book that Patrick Lencioni wrote. I love all of his books. It’s written in a fabled model. It’s The Ideal Team Player.

He talks about three components of leadership. It is being hungry. You certainly want to be hungry. What you want to look for in a leader is that they are hungry to grow and find solutions. The second one, they got to be smart. The third and the most important one, which is where we are going to spend more time than anything else, is the importance of humility.

No one is better to talk about this than joining me to talk about this with Jack Nunnery. When you ran the Warehouse Lending Program at your last company and also the Correspondent Lending Program, you had a very unique seat at the table. We all know in the mortgage and banking industry that the warehouse line of credit is the single most important counterparty in the industry. If you don’t have a warehouse line, you are not an independent mortgage banker.

There’s so much that’s going on. By the way, David sent me an email. He said, “Business cycle date some great stuff.” Thank you for sending that in. He’s one of our regular live audience. Jack, let’s get into talking about your unique perspective. Let’s first of all talk about the importance of being hungry and hungry for solutions. Hungry about this and not sitting around wringing your hands. Talk about innovation, hunger, and solutions. What did you see in leaders that you banked or those companies that seem to always rise above the circumstances?

David, there’s no single pathway to becoming a great leader. There are different styles out in the marketplace. Some of those styles work very well and are a bit challenging. When you talk about hunger and innovation, what comes to my mind is a very collegiate style of leadership.

What do you mean by collegiate?

First of all, you have to believe that you’ve surrounded yourself with smart people. A good leader is not afraid of surrounding himself or herself with intelligent folk. You want them to contribute from a perspective of innovation and thought. You’ve got to create an environment that welcomes that contribution. When I say collegiate, I mean we all get in a room, and I say, “There are no bad ideas, even some ideas that sound silly.”

When you break them down, it can be very intriguing. You create a penalty-free zone that allows people, for lack of a better description, to spitball ideas. From that, you hope to achieve a healthy interaction between various members of your team. From a collegiate style, I want and value your input as a leader. You are here for a reason. I hire you. Let’s share our ideas. If we land on one that resonates with the team, let’s begin to unpack it.

When you were at your last company, you brought me to work with you on the creation of the project. One of the things that you said to me back then that was so notable you said this statement. I will never forget it because I was struggling, as many do. That’s disagreeing with conventional thought, discussion or a train of thought. I almost was apologetically stepping up. You say, “Look and stop. If we are not rubbing, we are not racing.” You gave me permission to say step up and boldly come forth with some questions and thoughts I had, and it felt like I was trying to be contrary. I love that statement and said, “I wasn’t familiar with it.” Expand on that. It’s such a great statement.

David, if you are in a leadership role and you believe that the only good idea is your ideas, you have a problem. You have to take pride of authorship and put it in a box, open the bottom drawer of your desk, and leave it there before you get into your meeting. Encourage your people and tell them that it’s safe to disagree with you. I used to tell people, “I’m not dumb. I’m not the smartest guy in the world. I’m somewhere in between. We are all very intelligent people here. If you think I’m headed down the wrong path, please stop me and tell me why. I value that input from you. I’m not going to throw a penalty flag on you because I’m the boss, and you disagree with the boss.”

Importance Of Humility: If you only believe that the only good idea is your idea as the leader, you have a legal problem.

You have to check that at the door, David. Many leaders have too much pride in authorship. If it’s their idea, it will be the only idea. They get discussed that day in the meeting. People are so quick to tell you how smart you are and how good an idea that was. It may not be. There may be somebody sitting in that room that’s got the silver bullet solution but they are not going to participate. You’ve got to step in as a leader. You’ve got to lean in and tell people, “It’s okay to disagree with me.” In fact, I like it when you disagree with me but you got to tell me why you disagree with me.

It has to be supportable. Speaking to the confidence, you created an environment. When we were in working together on that, there were a lot of different opinions floating around the room. You clearly had a strong opinion on some things. I remember one of them. You and I were on opposite sides, and it was very uncomfortable for me, as a consultant, to consult with someone who had the position, the leadership, and all the trappings around that. Yet you brought that out to that like, “If we are not rubbing, we aren’t racing.” It was so important. You said, “I want that at this table. That’s why I hired you to come in here.” A lot of leaders struggle with that. Why do you think that is?

You have to be confident enough in your role as a leader to occasionally be wrong. You and I were working to build a new correspondent aggregation business unit. There are a lot of different moving parts in that and a lot of different ways you can construct it. We walk in with our set of ideas that is native to you, me or somebody else sitting in that room. Our charge is to come up with the best and most efficient process or solution we can. That may not be what I’ve got in my head. I’ve got to be confident enough in my role as leader of this business that I can say to the people, “That’s a better idea than what I had. Let’s go with that one. “

I’ve got so many thoughts around that but I want to get onto a couple of these other points. You invited that. I want to elaborate to everyone that’s tuning in to this, whether you are the person that’s sitting back not sharing your ideas, I would like to know why. We want to talk about this, and then you can participate in this show in however way you want. I want more of this discussion around this because leadership is going to become the defining factor of who makes it in this business and who doesn’t.

As a warehouse lender, I’m sure you have been surprised at who makes it as much as those who don’t. It’s not always the brightest or the best capitalist companies. It’s those that have the strong characteristics of leadership. That’s what I’ve seen. Before we move on to the next topic, do you agree with that statement?

Absolutely.

That looks like a rhetorical question but that’s an easy ball. I will throw a hard one. Here’s the next one. At Patrick Lencioni’s three principles, you got to be smart but talk about the importance of being smart. I’m speaking to you that you think you have a good idea. You are not sure if you have a good idea but we won’t know if that was a smart or a dumb idea until it’s put on the table.

I’ve watched meetings and sat in as a consultant when that quiet person that does speak up and comes up with an idea and is not as well thought through. You might say it’s half-baited but the smarter leader draws them out and draws that into the middle of the room because that may be one of the brightest ideas there in the room. It’s because of a lack of confidence. It’s not coming up. I watched you also do that. I will let you comment on that.

That goes back to the comment that I made earlier about a collegiate style of management. Knowing that you’ve surrounded yourself with intelligent people, leverage intelligence. You have those people that aren’t used to that style of management. They come from a top-down military style, lieutenants speak to captains, captains speak to majors, and lieutenants do not speak to majors. What a horrible way to run a business. It might be a great way to run the military but military and business environments are two different environments.

You’ve got to surround yourself with intelligent people, encourage or create an environment where they feel safe and participate, and acknowledge their participation. I’m not here to tell this group what to do. Ultimately, I will make the decision if I have to make the decision. I love to have the decision be the product of a bunch of smart people in the room together working for a common goal and agreeing on a common solution.

Importance Of Humility: Surround yourself with intelligent people. Create an environment where everyone can feel safe and free to participate.

Everybody buys in that. When you tell somebody, “This is how it’s going to be,” you don’t know if they bought into your solution or not. When the group arrives at the solution, everybody participates to get to that solution. You have some natural or native buy-in from the group, and they are going to execute the solution better than if this is what they were told to do.

It reminds me of one of the family jigsaw puzzles we were working with at that time. I’m usually pretty good at seeing spatially things and pieces out of an apartment. I remember we were at the lake house in Minnesota where I grew up, and there was a large puzzle table there and all these unique puzzles there. It was largely put together. At least the frame was basically done, and people were putting things together.

It was the one who did not feel confident. There are people there love crossword puzzles. Their idea of spending a good week at the lake was working on a crossword puzzle. “Forget that I’m out in the water, I’m out in the boat, I’m out fishing, I’m out water skiing or whatever else.” They love that. That’s what they relaxed you. The breeze and the whole relaxed atmosphere.

All crossword puzzle enthusiasts were struggling. I will never forget this one family member who walked through the room and said, “I don’t work with them.” I would say, “You may be the best one to come look at this. Take a look. We are struggling with this.” They found the one piece and he said, “Not sure if this will work but try this one here.” All of a sudden, all these pieces came together. It was the one thing. It’s their optics on a particular solution. It was smart of the group to invite him in.

That’s what I think a lot of leaders failed to do. Invite them in create an atmosphere that’s safe and secure, and honored, which comes to the next point that I want to spend the rest of our time on Jack, and that’s humility. There’s an old proverb that goes, “Pride goes before a fall.” Jack, how many times have we seen prideful people that think they are God’s gift to intelligence. They are this and that. You were referencing the team aspect of that. I’m thinking of a collaborative approach. What was the word that you used?

Collegiate.

Collegiate and collaborative. It’s bringing everyone together where it’s a team. We always look to what are the unique gifts that are sitting in the room that’s sitting there quietly. Sometimes, it’s that one person who can find that one piece. They don’t talk and contribute to all the other things but it’s the humility of the group. There’s group humility in leadership. It starts at the top.

We need to have humble leaders, and I’m thinking of several people. In fact, I was out in Guild Mortgage’s offices, and there were some great leaders there. One of the things we talked about there was how they strive for humility. We were talking about Casey Crawford at Movement Mortgage. I’m not lifting up any one person more than anyone else or anything like that but I’ve seen firsthand Casey humble himself in a management meetings. I look at the success. We happen to be there at the beginning of his journey.

He googled how to start a mortgage company. Many people have heard that story. I showed up on a website. My other team members and I have helped him build what is now one of the biggest, most successful, and most profitable companies in the nation. One of the elements that I think of when I think of Casey is the level of humility that’s there. I have been on a little bit of a soapbox on this. Go ahead and jump in. How important is humility, and how do you see it show up into a major strategic advantage for companies that you’ve banked in the past?

Humility is absolutely critical. I’m going to restate humility and say be genuine and have empathy. You see many top-down leaders, and they come across as disingenuous. To have a leader that relates to the team in a genuine way without the pretense, “I’m one extra person in this room. For the purpose of this conversation, don’t view me as a leader. View me as a person in the room that wants to get this done in the best way we possibly can.”

Be on the same level as your people that you are trying to inspire and motivate. Once you put yourself up on a pedestal, you’ve lost a certain element in terms of being able to connect with the folk that you are trying to lead, and you’ve lost that safe zone aspect to this. You turn off the pedestal, look them in the eye and basically inspire them to work together as a team to solve whatever challenge that we are facing in this particular situation. The good thing about mortgage banking, there are always challenges, so there are no pedestals.

That reminds me of Governor DeSantis in Florida. I didn’t realize he was in Special Forces. He was in the military, and then he went through Special Forces. The person was interviewing him, and he was talking about leadership and what are the qualities of leadership. He says, “I learned something when we were on a mission in Special Forces. When it came to that, the commander down to the lowest ranked person were all dressed in the same outfit. There was no perception of rank when it came to a mission because they all understood their roles and responsibilities.”

“There was clearly a defined leader but when they went out that helicopter and were landed behind enemy lines or whatever mission they were on, they all looked and operated with the same mission. The mission became the dominant thing, not rank and file.” That’s one of the things. That’s a great interview. For those of you who are interested in hearing about the interview that I listened to for Governor DeSantis and why he is having success, you may not love his politics. I don’t care. I’m looking for leadership, and I’m looking for them hungry to look for good leadership.

For anyone reading, I encourage you. If you find a great story on leadership that you admire, tell me that. Share that with us because we are going to spend more time talking about this as we move forward on future episodes. Simon Sinek is one of the favorite authors. I love what he writes on there. I’ve got the book. It’s called Leaders Eat Last. There are some principles in that book, the subtitle is Why Some Teams Pull Together, and Others Don’t. It’s all about leadership, and it comes to the humility that is a factor in it. Have you wrapped this up with some final thoughts and then put a bow on this episode?

One other aspect of leadership that we need to keep in front of mind, especially in the mortgage sector, is consistency and stability. We are faced with so many external influences, interest rates, regulators, CRA, and posed on independent mortgage bankers. There are so many things that can drag us off or deter us from our mission statement. To be a consistent and stable leader is important.

Importance Of Humility: The mortgage sector faces many external influences that drag people off from their mission statements. This is why a consistent and stable leader is important.

I will tell you a quick story. A guy that you and I both know that I used to work for. He was gruff and grumpy, and I told him one time, “You are the easiest guy I’ve ever worked for,” and this look of horror came over his face. When I say, “You are the easiest guy that I ever worked for,” I’m complimenting you, and here’s why. It’s because you have one agenda.

Many people have agendas in each pocket. Whichever way the wind is blowing that day, the political wind, they pull that agenda out, and that’s what they are going to use for the day. That’s so frustrating to us that we are trying to work for that person. I told this guy, “You’ve got one agenda. You clearly communicate what that agenda is, and I know that the product of the work that I produce meets your expectations. You are the easiest guy I ever worked for.” I appreciated his consistency in his approach to leadership. There was only one him. There weren’t seven of him that the different political winds would bring out on any given day. I don’t care which way the wind blew. He was the same every day.

Something about consistency is an amazing quality. We could go on and on, folks. It has been such a joy to have you here with us, and we love your feedback on our new format that we are working with. Very similar to what we have been doing but we are putting more commentary in on this. I want to say a special thank you again to our sponsors.

Finastra, FormFree, Letter Toolkit, Snapdocs, Total Experts, SimpleNexus, the Mortgage Bankers Association of America, Lenders One, the Mortgage Collaborative, SuccessKit, Knowledge Coop, Mobility MMI, Modex, Mortgage Advisory Tools, and DW Consulting. Folks, check out all our sponsors on our sponsorship page. It’s so good to have you here with us.

I look forward to having you back here next time for another episode. We are producing more and more episode each and every week. Stay up on them because we care about you getting the right information, and we would love to hear from you. We are so grateful to have you as a reader. Have a great week, everybody. Thank you so much for being here.

Important Links

• Finastra Fusion Mortgagebot Solution
• FormFree
• Christy Moss – Previous Episode
• Lender Toolkit
• Snapdocs
• Briana Ings – Previous Episode
• Josh Lehr – Previous Episode
• SimpleNexus
• Shane Westra – Previous Episode
• Mortgage Bankers Association of America Lenders
• Lenders One
• Knowledge Coop
• Mobility MMI
• Modex
• Mortgage Advisory Tools
• DW Consulting
• The Ideal Team Player
• Jack Nunnery – LinkedIn
• Movement Mortgage
• Leaders Eat Last
• Mortgage Collaborative
• SuccessKit
• BOXABL CASITA – Accesory Dwelling Unit