There’s A Disruption In The Force

In today’s business climate, talking about “Business Disruption” is all the rage. Disruption is now synonymous with innovation which is synonymous with winning. Uber and Amazon are “Disrupters”. Uber has redefined on demand car service and Amazon owns online buying, shipping, delivery and now Digital Cloud solutions. It seems simple in concept, but is elusive in practice. Very few businesses seem to actually deliver the innovation required to become “Disruptive” and with the process and compliance complexities of mortgage lending, the goal is doubly challenging. Disruptive business models imply a willingness to think differently, operationalize a vision and leverage new technologies to deliver it. After recently seeing the latest trailer for this year’s Star Wars movie reboot, it occurred to me there are a few interesting parallel storylines with the mortgage industry worth exploring.

First the original concept of “The Force” as an omnipresent energy available to all, but leveraged for advantage by a precious few (Yoda, Obi Wan, Luke), reminds me of how so few lenders take advantage of optimized processes, proven technologies and innovative tools available. Ironic, because lenders seem to understand mastery in these areas is crucial to winning in an increasingly competitive purchase money environment, while unwillingness to challenge outdated thinking inevitably leads to the Dark Side.

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Also, in the original Star Wars, Luke had innate ambition to do something important with his life. He was the very symbol of “Disruption”, capable of challenging the tyrannical grip held by Lord Vader. To achieve his destiny, Luke eagerly absorbed lessons learned from Obi Wan and trained with Yoda to improve skills, so he could harness “The Force” to his advantage and reach his fullest potential. Ultimately, he was successful when he teamed up with Princess Leah, Han Solo and R2D2, who provided vision, tactical skills and technical knowhow to defy all odds and destroy the Death Star.

Likewise, today’s lenders “feel” they have a higher calling to deliver on customer needs, focus on addressing compliance requirements and automating key processes to effectively compete. Most lenders seem to understand what they must do, and they discuss it, but they have yet to crack the code to harness their own “Force” and carve out their own market niche. They have a notion of some key ingredients but may lack the actual recipe to achieve Skywalker-like success. There are some likely culprits for this.

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First, most lenders develop a vision in the context of their existing franchise so it is nearly impossible to re-imagine their business models from scratch. Conversely, Luke left his home planet and his entire way of life to evolve into something brand new and exceptional. Second, lenders are consumed with day to day operations making it difficult to find time to consider new strategies, redesign current policies and rethink outdated processes. With existing operations come existing baggage and resistance to change. Contrarily, Luke’s only allegiance was to learning anew and putting teachings into practice. Lastly, lenders seem to have the greatest challenge with implementing new technologies. Their existing outdated platforms do not play well with advanced technology stacks designed with change in mind, so they dabble with point solutions instead of taking a disruptive transformational view. Luke, on the other hand, embraced quite the opposite approach. He knew technology created an advantage. Over the course of three movies he used R2D2, C3PO, the Millennium Falcon and his Light Saber with great effect to consistently overcome adversity and ultimately harness “The Force” to win the day.

So as a lender, becoming a “Disruptor” and harnessing your personal “Force” for good need not be so far far away. It is after all your destiny.   First, heed your inner calling to deliver service excellence within the constraints defined by the CFPB. Then develop a vision and reinvent your identity, processes and brand. Always partner with seasoned mortgage innovators to deliver flexible digital functionality for competitive advantage. And integrate the latest technology wherever possible to deliver lower cost intelligent loan manufacturing allowing all parties to proactively contribute to the process.  There can be no try; there is only do. And if you do, you will surely rule the mortgage galaxy.

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