A Green Thumb and a Growth Mindset - Talking Leadership with Kent Oram

Hey, it’s Al Dominick, one of your hosts for Plugged In. I’m joined on the other side of the country by my fellow partner in crime, Steve Williams.

Steve, what’s happening, my friend?

Not much. Good to be here on a Monday morning.

Plugged In is up and rolling, and we’ve got some really cool things happening in the world of finance. Our guest today has a green thumb and a growth mindset.

Steve, can you introduce who we’re talking with?

I’d like to introduce a pretty legendary CEO in the credit union industry, Kent Oram, CEO of Idaho Central Credit Union.

Kent, thanks for joining us.

You’re welcome. Thanks for having me. I appreciate being here.

We like to talk to interesting leaders who’ve had interesting results, and you certainly have.

We want to jump right into the Kent Oram story. For everybody’s edification, Kent will be retiring this December. Correct, Kent?

That’s correct. I’m hanging up the spurs on December 30.

We want to dig into your 15 years as CEO.

Sounds good.

Al and I want to go back a little further first. We’re going to do some song lyrics this morning on Plugged In. We usually go with five lyrics, but because Kent is coming up on retirement, we have a special sixth one. They all tie into some things we want to talk about.

We’re going to test your knowledge and see if you can figure them out.

Okay, sounds good.

Let’s go way back to childhood with John Denver’s “Thank God I’m a Country Boy.”

Your background included farming and working at a car lot. How did your childhood impact what you became as a leader?

When I read those lyrics, I think about the fact that it wasn’t just my dad. It was my mom and my dad.

They taught me more than simply how to give a little. They taught me to give a lot.

One of the things my dad used to always say was, “Give more than you take, and you’ll always come out ahead.”

I was raised that way, and I’ve tried to behave that way as their child.

I worked on a farm moving pipe. That means 40-foot sections of aluminum pipe through a potato field. You walk across, hook them up, then go back and get the next one. It’s hard work.

I was 13 when I did that, and I actually really liked that job.

Then I worked at my dad’s car body shop. That’s where I realized how disgusting men can be because one of my jobs was cleaning the restroom. We’ll just leave it at that.

As I went to college, I worked on a farm for a wonderful man who has since passed away. He was a mentor to me in many ways and taught me many things.

I was sort of sad to leave his farm, but he had three sons who had his last name, and they were all younger than me. I knew it was time for me to go use my degree.

How did that impact me at Idaho Central?

I’m not afraid of a little hard work, or a lot of hard work.

I’ve never done anything at Idaho Central, sitting in my office, that was more difficult than working on a farm.

The physical labor of a farm is character-building. To watch those people put everything they have at risk over a crop that is subject to weather and all sorts of unforeseen things teaches you resilience.

Kent, when you’re talking, I find this interesting.

I worked in high school on a car line factory. I did the graveyard shift, and I survived for about two and a half weeks before I got the boot.

When I got the boot, I realized I actually had to buy some steel-toed boots, so I had a negative paycheck on my first one.

I quickly realized that type of manual labor wasn’t for me.

But I’m curious. You talk about getting your start and your perspective. How did you decide to go from that blue-collar, roll-up-your-sleeves-and-show-up-every-day world into financial services and really get your career going?

I graduated from college in 1983 with a degree in management information systems.

It was a brutal time to try to get a job. It was very difficult. I had many, many interviews and never landed anything.

My youngest daughter, Holly, was being born in October of 1980, and I was sitting in the waiting room. I met a man who worked at Idaho Central Credit Union.

He said, “When you graduate, give me a call.”

I remembered that.

When I graduated, I thought, “Well, I’m going to give him a call.”

I called him, went through the interview process, and they hired me.

I had never been in a room with a computer, but I was hired as the data processing manager.

I quickly made friends with the computer.

I didn’t intend to stay at the credit union for more than about five years. Everybody told me, “You need five years of experience.”

So I said, “Okay, I’ll go get some.”

But then I went to Western CUNA Management School and caught a little bit of a bug for credit unions in general. I felt like I had some aptitude for this.

That’s how it happened.

Very cool.

Kent, you grew up around Pocatello, and that’s where the credit union is headquartered, not far from Utah, where a very famous family, the Osmonds, are known.

Growing up in the ’70s, I know you’ll remember Donny Osmond’s famous ’80s comeback hit, “Soldier of Love.”

I want to take a quick look at your 15 years as CEO of Idaho Central.

You went from about $620 million in assets to roughly $9 billion.

That’s quite a run.

That’s basically a 20% compound annual growth rate for 15 years, which is not seen very often in financial services.

You’ve created one of the most impressive growth stories for an insured depository.

Here’s the question, though: where were you lucky, and where were you and your team smart?

I read that question a little earlier, but I need to correct your math. We’re at $9.3 billion today, just so we can keep up.

Where were we lucky?

There’s a quote attributed to Seneca that luck is where opportunity and preparation intersect.

I often think about that.

A lot of times we’ve been prepared, and then things have happened that we’ve been able to capitalize on.

In that way, I guess we were lucky.

I’ll give a couple of examples.

In 2018 and 2019, we built a new data center with all sorts of remarkable capabilities. We thought we had maybe even overbuilt it.

Then 2020 came, and we were able to deploy 700 people to work from home in 10 days.

That felt lucky, but it wasn’t lucky because we were so prepared for it.

Where have we really been lucky?

I don’t know if it’s luck or not, but where we live and operate is a wonderful place.

Idaho is just a wonderful place to be. Good, hardworking people, including our employees and the members we serve.

We rolled out mortgage at kind of a downtime, and it took off like crazy.

We rolled out business services at a downtime, and that took off like crazy.

We just keep building branches, and that works.

It’s hard to imagine that’s all luck.

I think a lot of that is really good decision-making by all of us along the way.

But we’ve been blessed. We’re in a great place too.

What’s a decision you made where you said, “I’ve got to admit, in all modesty, that was pretty smart of us”?

I think being persuadable enough to roll the dice big time in 2008 on a mortgage department was remarkably risky and remarkably rewarding.

I’m so proud that together we made that decision.

It was a gamble. It was a gamble, and it felt so good.

Gotcha.

I’ve got one more question, and then I’m going to let Al ask some.

One thing I didn’t realize for a long time after I met you was that you were a Black Sabbath fan, Kent. Usually, the kids from Pocatello don’t always lead with that.

There’s a great song, “After Forever,” by Black Sabbath.

Knowing you, you’ve always been an independently minded person.

When you look at the industry, you don’t try to follow quote-unquote best practices. You try to process and think for yourselves.

Take a step back and look at financial institutions right now. Where do you see the herd mentality? Where would you say financial institutions need to break from the pack and think more independently?

I could get in hot water on this one, Steve.

Be careful.

One time, we were having an examination years ago, and I said to one of the examiners, “Stop talking about best practice. You’re at the place that created best practice. Why don’t you look around?”

Sometimes we can find ourselves defending things that shouldn’t be defended.

Credit unions are doing really well. Some are very innovative and very well run.

We’re doing just fine.

I think sometimes, in an effort to squeeze us into a box, innovation gets crushed.

I hate that, and we resist it where we can.

We’re still a highly regulated business, so it can be tough sometimes.

But I think there are a lot of things available to a credit union or other financial institution that are just across the line.

I don’t mean across the legal line. I mean just across the regulatory line.

I’m also a NASCAR fan, and there’s a NASCAR saying that if you ain’t cheating, you ain’t racing.

I don’t go quite that far, but we push the limits for sure.

It’s always that regulation-versus-customer-experience question too. How easy do we make it versus how much do we put customers through for compliance?

Sorry, Al. Go ahead.

No, no. I want to finish one more thought.

One thing that’s also very important is to develop a relationship with the regulatory agencies where you understand each other.

Sometimes you get a little bit of latitude.

You don’t cross their lines or break their rules, but you get a little bit of latitude when you come into the world of “best practice” by having really good relationships with the regulators.

As I’m listening to Kent, I really wish we’d taken some Ricky Bobby quotes and scattered them throughout this.

“I don’t know what to do with my hands right now.”

What’s interesting is, as I listen to the two of you talk, this whole concept that Louis Pasteur famously articulated, “Fortune favors the prepared,” has been co-opted of sorts by the crypto world.

Matt Damon was doing ads during the Super Bowl about fortune favoring the brave.

The whole technology space that we’re in reinforces the idea that you follow people not by title, but by behavior and the way they treat others.

Technology is a wonderful tool, but that’s exactly what it is. It’s a tool that has to be married to a business strategy and concept.

Steve has tossed out a few musical lyrics. I wanted to take something from Styx.

“The problem’s plain to see, too much technology. Machines to save our lives, machines dehumanize.”

Now the three of us can say at the same time, “Domo arigato, Mr. Roboto.”

Clearly, Styx was onto something when they authored those lyrics.

What strikes me, as somebody who spent years in the banking world and looked over the fence at these progressive, growth-focused credit unions, is that Idaho Central has made some really big, bold moves in technology with players like Salesforce, Alkami, Temenos and CNote.

These are household brand names across the banking sector.

What has been your approach, and maybe the secret, to being able to use these technologies to have specific business impact?

Again, these are tools that require teams.

If you rewind 15 years, we couldn’t have afforded to do what you just described.

But it isn’t 15 years ago anymore, and now we can afford to do those kinds of things.

We’ve made some big gambles on technology companies, from core to eBranch.

We’ve gone with companies that had something really cool but maybe weren’t quite proven yet, and then helped them get there.

We have a saying internally that we don’t write software. We try to stay away from writing code.

Nowadays, we tinker with that just a little bit.

But we like to take what’s on the shelf and make it work in remarkable ways that maybe the inventors didn’t even imagine.

We push things. We push things hard.

We have a wonderful team. I don’t even know how many there are now, more than 100 who work in our technology area.

They’re very dedicated and very thorough. They love to bring new, good things to life.

We’ve hired some super-smart people.

We have one young man in particular who, whenever he does something, I’m just like, “Wow. I never thought we would employ somebody like that.”

He’s just off the charts.

Now we can take that talent and use it to help Idaho Central Credit Union achieve financial success.

Leadership really is a choice. It’s not a title.

The fact that you’re able to attract folks to a part of the country that people like me, who live on the East Coast, might once have looked at and said, “Would I ever move my family from New York, Boston or D.C. to Idaho?”

A few years ago, you might have said no way.

Now you’d at least pause and think, “Hmm. Let’s consider the upside and the opportunities.”

Steve and I have spent some time listening to tracks as we’ve driven from airport to airport.

One of the ones we both kind of hum along to is by Sly and the Family Stone, “Everyday People.”

I’m going to tie that everyday-people theme to the idea that you’ve gained incredible market share against some of the nation’s largest banks.

Part of that success, I have to imagine, comes from being genuinely part of the fabric of your local community.

Take a step outside of your role and think more broadly.

What do local financial institutions need to understand and execute on if they want to have a growth mindset and dedication to growing the communities they’re a part of?

There are a couple of things I don’t get.

I don’t understand why some institutions don’t engage with communities in the ways communities want to be engaged with.

We were one of those institutions in 2006.

When people tried to reach out to us, we always wanted something from them.

It was, “What do you have for us, and then we’ll consider you.”

In 2008, I flipped that.

I said to my team, “Hey, why don’t we reach out and see if everybody reaches back? Why don’t we be first instead of second?”

Out of that grew what we call the Green Team.

We have 50-some Jeeps that are wrapped. We have Mercedes Sprinters.

I think last year we went to 1,400 events around our communities.

The chambers of commerce know when we roll into town because we walk into their offices and sign up. They don’t have to recruit us.

We’re involved everywhere.

What I don’t understand is why more institutions don’t do it.

Some have started to figure out that it might have some power.

It doesn’t just have a little power. It has immense power.

It may be harder to do in some credit unions in larger markets than ours. I’ve never worked in a place like that, so I don’t know for sure.

But I can tell you right now that in our area of the world, it works like crazy to be part of the community and have people know you have their back.

Every now and then, you step on your toes, and they’ll let you know, “Hey, that’s not what we expect from you.”

When you start to get that kind of feedback from a community, you know you’ve really become part of it. You’ve become ingrained in how they behave.

Now we’re trying to take that into Washington a little bit.

We were just named the number-one philanthropic organization in the city of Spokane for 2022.

I was like, “That’s crazy. We’ve only been there a year.”

But that’s because of how we engage with the community.

They see us. They feel us immediately.

It’s also a big contributor to culture, right? People wanting to work there and stay there.

In the world of ESG, it sounds so simple, but it’s been a big part of your success on culture too, right?

Totally.

People ask, “How much do you pay people to go walk in a parade and throw candy?”

If you have to pay people to walk in a parade and throw candy, something’s wrong.

That should be fun.

So we make it fun.

There was a homecoming parade for a team that doesn’t really do very well, and we had 112 people show up to walk in the parade.

Yeah, it’s a huge culture builder.

That’s awesome.

You talk about having fun. The B-52s had some fun throwing down “Love Shack,” which everyone is familiar with, but they also wrote “Private Idaho.”

I won’t bore people with the lyrics, but you should check it out because it really ties into this bonus question for Kent.

It’s all around the state of Idaho, which has really exploded over the last eight to 10 years.

What do you think the future looks like for Idaho going forward?

It’ll be interesting over the next two years to see, as our country perhaps goes through a recession, how Idaho does.

In my time at Idaho Central over the past 39 years, mostly we skip recessions.

We just say, “Hey, there’s a recession going on in another part of the country, but it’s not really impacting us.”

2008 was different. It came here too.

Our demographics are really good. People want to be here, and people want to live here for all sorts of reasons.

Idaho is a lifestyle place.

It’ll be interesting to see.

My prediction is that we’ll have a recession in the U.S. That’s not a very hard prediction.

My other prediction is a little harder.

I think Idaho is going to skip it.

We’re going to opt out, and we’re going to do just fine.

The problem will be interest rates. We have to conform to that.

But everything else? There’s good demand.

This is a great place to be and a great place to live.

I wish it was still our private Idaho, but it’s not anymore.

That’s also good for our credit union, to have new people moving in all the time because we’re a place they choose.

If you make it out to Idaho, which is a beautiful part of the U.S., keep an eye out for that Green Team that Kent was talking about.

Maybe they’ll take you by the farm where I believe you’re going to be growing some alfalfa or some hay and doing some good things on the next part of your journey.

We appreciate Kent Oram getting Plugged In with Steve Williams and myself, Al Dominick.

This is Plugged In by Cornerstone Advisors.

Thanks for taking a listen. We’ve got more tracks coming your way in the days and weeks to come.

Kent, thanks so much.

A salute to a great leadership career at Idaho Central and everything you’ve done there.

Thank you very much. I appreciate it.

It’s been a wonderful ride, and I know we’re in great hands going forward.