Dennis Stevenson; what he said before it all went pear-shaped

In 2000,  the company I worked for published a book called ‘ Creativity Works’ and I helped organise the launch (which included a reception at No.11 – oh la la). The book covered interviews with a series of business leaders on why they thought creativity mattered in business, and how it could make a difference. With a foreword by Gordon Brown, interviewees included Martha Lane Fox, Terry Leahy, Charles Dunstone…and Lord (Dennis) Stevenson.

Not surprisingly, the Dennis Stevenson interview included reference to the Halifax (well before the merger with BOS) and his appointment of Andy Hornby. With the benefit of hindsight and in the light of the report from the Banking Standards Commission, it makes fascinating reading, especially his views on mergers. Here’s an extract....

“ Let’s switch to the Halifax, which is a mature business in a mature industry, but which I would say I believe is also behaving in a brave and creative way. Our strategy is to treat consolidation – mergers and acquisitions – as guilty until proved innocent. We think it has destroyed value on both sides of the Atlantic and the opportunity cost is huge at a time when we ought to be changing our business strategy. This is so obvious it hardly bears saying. Yet because pressures towards aggregation are so strong, it is the only real game most other banks are playing. So we are definitely swimming against the conventional tide.

Secondly we are saying that this is an industry which has been badly, or at best averagely, managed all over the world. So another part of our strategy is to transform the quality of the management in this business and thereby transform the performance. The first sight of that was to hire Andy Hornby, at the tender age of 33, to run all of what most people know as the Halifax. Was that creative? It was certainly brave because putting someone in charge of 20000 people whose average age is several years older than he is, is not the most obvious thing to do.

And the third part of our strategy is to become a venture capitalist in our own industry, which means seeing the new technology as an opportunity, not a threat. It is about being brave enough to take advantage of the opportunity that has been given to us to put our money and our expertise into a new area, and so to increase our market share. So we have invested £2billion, not in new divisions but in totally new ventures.

The Halifax strategy is radical, it’s bold, and it breaks the mould, and if creativity means doing something differently, I suppose it is creative. Creativity is also partly about having the courage to do what other people might not see as obvious.”