Larry Kennedy – The Voice of Experience
When I met Larry Kennedy, he had seen the best of times and the worst of times in the financial markets. He had been an old time stockbroker – back in the days when being a stockbroker was all about buying and selling stocks for clients. He had been what we call these days a “stock jockey” – in the days when clients had no information and they needed someone to rely on, in order to enter the financial markets. Those original days in the financial services industry were all about information and control – the stockbrokers had all of that, and the general public had none.
Larry spoke often of his days with Kidder, Peabody & Co. – commissions were much higher in those days then they are today and stockbrokers could make a great living buying and selling stocks/bonds for clients. The biggest lesson Larry shared with us from those days, was the experience that comes with having seen every type of market – high inflation, bear markets, bull markets, collapse, and catastrophe – he had seen it all.
There is a silent comfort that comes with having a leader and a mentor who had been through so many different types of financial markets – the reassurance of someone having “been there, done that”, knowing no matter what happens, all will be calm – the sky will not fall and life will be okay. He was that kind of a leader – his mere presence could calm any storm.
What Larry also shared with us is the clients who truly accumulated wealth, from his stockbroker days, the ones who made the most money, were the clients who were not trading stocks/bonds, but those he had placed on the side in mutual funds – almost forgotten about. As he called it, “benign neglect.”
Stock trading and stockbrokers have long since passed in the financial services industry – replaced by financial advisors – long-term buy and hold strategies have replaced the trading strategies of yesterday. Here was a man who had lived through the transition – seen the sweeping changes in the industry, and proven first hand – buy and hold – time in the market, not timing the market was the only real, sure fire way to truly be successful long term accumulating wealth.
With the transformation in the financial services industry, by the time I had met Larry Kennedy, he had also transformed as a person. I met a sweet, kind, gentle man – a fatherly figure who immediately took me under his wing. From the stories he told us – this seemed in sharp contrast to the Larry of youth.
People mellow with age and wisdom – and often transform in unimaginable ways over time. As Larry would often tell us – “Larry did not like Larry” in those youthful days. So Larry, along with the entire industry, became a kinder, gentler, more open minded mirror image of his former self. I can’t say I knew the other Larry, but this one was quite a mentor to me.
Lessons in Management and Leadership from Larry Kennedy
Larry interviewed me for the job at Frost Bank as an Investment Officer (Financial Advisor). He would later tell me he had a debate with the other hiring manager, who felt at twenty-nine years old, maybe I was not yet old enough for their Investment Officer program. Larry, with his infectious optimism and calming, sage demeanor, of course, convinced her I was the right person for he job.
He had been the first Investment Officer ever hired by Frost Bank. He spoke often of the basic structure of the brokerage program and the tenets he held so dear when he constructed the program. Important lessons for anyone involved in constructing, designing, and maintaining a sales force – in any industry. What he taught me was the following with this regard:
1) Do not change compensation – get it right the first time and do not change it
2) Make the compensation fair, maintain a competitive advantage with how you pay your sales people, treat your people right, and you will retain the best people
3) Keep your program salesperson-centric – never forget the importance of your people
4) Be the advocate for the saleperson or employee – keep an open door and remove obstacles for your people when obstacles arise
5) Sales people are motivated by the prospect of unlimited potential earnings – do not cap their earnings potential
As a result of Larry’s principals above – turnover of Investment Officers was typically an industry low of about 10%. At a time when 90% turnover was considered normal for the large brokerage firms, like Merrill Lynch, or 30% to 40% for a typical bank brokerage program.
Larry understood – do not mess with people’s compensation. The quickest way to destroy a salesforce is to inject the uncertainty of how the saleforce will be paid presently or in the future. Stability is important in compensation – loyalty is lost the minute you mess with someone’s paycheck.
You would often hear Larry saying, “I am your advocate.” In other words, if you need help and support, if conflict arises inside or outside the department, pick up the phone, call me, and we will figure out the best way to fix or remove the obstacle together. Larry was more than willing to fight the battle for you if that was the needed solution.
I can say I observed this first hand. Occasionally, when a problem would arise with another department, or even within our own department – I would call Larry with confidence knowing the problem would be resolved. He was truly an advocate for me.
As I wrote in Mentor Me:
“I will never forget when my manager and mentor, Larry Kennedy, came to me to discuss my second-year goal. When he gave me a goal of $474,000 in production, I nearly choked and hyperventilated…that would be almost 60 percent more than my first year…which was the best year ever for a first-year investment officer! He looked me directly in the eyes and with sincerity said, ‘Ken…I know you can do it… I believe in you.’
As the mark of a great manager – Larry saw my potential, influenced, motivated, and inspired me to perform at levels I did not even know I could achieve. I beat the goal Larry laid out for me, and he was instrumental in my promotion to management.
My Only Regret – Larry Kennedy Retired – Not Enough Time With Him
My only regret with Larry is, my time with him was too short. He retired halfway through my second year as an Investment Officer. Although, we did speak a few times on the phone after that, as he encouraged me and helped me through the transition from Investment Officer to manager. He would also come to our biannual sales meetings so his presence and care were perpetually felt in the program he constructed and created.
Even now, as I am writing this, I can hear his favorite, true, wise, words of wisdom. “When times are good…everyone gets a piece of the business. When times are bad…the good get it all.” Reminding us to constantly better ourselves, hone our craft, be students of the business, and create the best possible relationships with our client’s keeping their best interests at heart.
All important lessons in leadership and management I will never forget!
Thank you Larry Kennedy!
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