Aug 12, 2021 | 21 min read

Deep Tech in the World of Banking with Chintan Mehta

By: Patrick Emmons

Deep Tech in the World of Banking with Chintan Mehta

Banking has been around for hundreds of years. How do you teach an old dog new tricks? Chintan Mehta, CIO and Head of Digital Technology and Innovation at Wells Fargo, joined Patrick and Shelli to discuss the technological revolution happening right now in banking. He talks about what the next five years look like for innovations such as quantum computing and cultural shifts such as the gig worker economy. Listen in and get inspired.


Shelli: Chintan, if you don’t mind, can you share with our listeners more about your role with Wells Fargo?

Chintan: The role encompasses leading a group called Strategy, Digital, and Innovation. I’m one of many CIOs at Wells Fargo but essentially the group is responsible for focusing on our corporate strategy, which is more outward-focused in terms of what we do five or six years out from where we are today.

We do lots of work with academia. We are a partner of the Stanford Human-Centered AI group. We do a lot of work with the MIT Watson research lab. And there’s the digital component of the ecosystem which is all around the consumer-facing as well as client-facing experiences like online banking, the mobile app, and the AI and ML capabilities.

The best way to look at it is that strategies are things that are five or more years out. Innovation is what we are doing now - creating a strong hypothesis and testing it with customers. Digital involves scaling innovation out to mainstream customers.

Deep Tech Work in Banking (02:23)

Pat: One of the things that we talked about before the show is deep tech work and banking. When it comes to deep tech work, is banking a good place for that?

Chintan: I think it is a good place for that.

Four hundred years ago, people figured out that there was a need for bringing capital to where there is a need for money. The core of banking involves matching those two together.

Over the years, the core of banking hasn’t changed. However, the way we manifest that basic necessity of facilitating transactions, matching capital to where the need is, and everything which goes around it, like moving money, doing financial health planning, and life cycle management, have all evolved. The way these are offered from a technology standpoint has also evolved, which leads to a completely new radical business.

Technology is the only thing that is constantly changing for this business. The way your interactions are evolving and the way your experiences are evolving is predominantly defined by the technology of the day in question.

To answer your primary question, I would say technology roles in banking are interesting and challenging in all cases. Not every role would be a breakthrough in terms of building new things. However, for the most part, banking and financial services are leading the technology evolution in the world.

Risks & Challenges (03:59)

Pat: It does make me wonder. There are a couple of articles about the effectiveness of the investments in the banking space from a technology standpoint and the ROI. What do you think is the biggest challenge for the existing banking players, the big names we all recognize?

What are their biggest intrinsic risks and challenges around actually leveraging technology and the investments that they’re making?

Chintan: I would say by far the biggest challenge would be speed. How quickly do you adapt to incoming insight, whether it’s customer feedback-driven or from your internal processes?

A startup’s advantage is they don’t have an existing cash cow. They don’t have an existing legacy money-making business that they have to care for while they are building a completely new offering. There is an established player in every industry. Banking is no exception. Every industry-established player will have to do bimodal thinking - how do I protect what I have, to some extent, while extending or building something new.

If you are comfortable as an organization, culturally, cannibalizing your own business, because you know the macroconditions of the overall market are drifting and changing, you will have a lot more strength. By and large, most people and most companies are uncomfortable doing that.

Even the startups from five years ago are now established players and they’re going through the same route. They have an existing revenue stream and if they do something new, it might cannibalize that. How do you decide in that context?

Pat: It’s interesting when you say that these startups have the advantage of not having a cash cow.

Chintan: Yes, the advantage is being able to rethink the problem from a very fresh perspective without having any constraints. The legacy is a constraint. It has an advantage; it gives you a fresh source of revenue or a constant source of revenue that you can innovate on top of. However, it also gives you an anchor that you have to deal with in terms of new thinking.

Pat: It’s very common from the innovator’s dilemma standpoint. What do you think are some of the things that successful banks are doing to be more risk-tolerant?

How much change have you seen in the last 18 months? The status quo isn’t as safe as it used to be. In 2019, taking big risks probably wasn’t going to be listened to well by the chief executives. Now, it seems like there is more consideration for that.

Chintan: There is. The fundamental thing is that you have to experiment with new customer offerings. The structural piece, which has to be in place, is how can you contain those experiments from a timing standpoint? How can you contain them so that you have a fail fast-type construct around it to understand if you should do more of it or not do it at all?

There is economic value to be built from a customer standpoint, as well as some value to be captured from a firm standpoint. How long does it take you to capitalize on the experiment? How do you get it into the market and in front of customers and start deploying it?

I would say we, collectively as an industry, are doing better than we were two years ago. Different banks are at different places in terms of their sophistication and their risk appetite. We would not be the ones at the moment doing massive investments in adjacent possible business opportunities.

However, some of our peers are doing that already. Whether it’s Goldman or JP Morgan or Santander, there are a few banks that are going beyond the traditional scope of what you would call financial services and going after adjacencies. Though experimentation is the only way you can prove a hypothesis, short of burning lots of capital and proving that you’re wrong.

Five Years Out (08:50)

Shelli: You mentioned earlier that you plan five years out. That’s so interesting because with technology you can’t even really plan six months from now. Are you having to revisit that long-term plan all the time?

You also mentioned failing fast. I’m curious how that all works together.

Chintan: To be fair, I use the strategy competent to look at what will likely happen five years out. That’s a very hypothesis-oriented and open-ended perspective on where the industry is going in the next five years. This is based on what we know today and what is going on. Whether it’s from a technology conference standpoint or industry or regulatory changes, we take a perspective on what banking will look like in say 2030.

In that context, what should we be thinking about? What should we be working on? We work backward from that perspective. The plan loses fidelity as you go further in time, which is why we kind of create those horizon pictures. For example, horizon one we have to do right now. We have to be able to build it and launch it, which is the digital ecosystem.

Then there’s horizon two. We have a strong hypothesis that there is value here, but we are still figuring out how to offer it to a customer. How do you create an experience that is effective in the market?

Then there is horizon three, which is all these strategic competencies that we know at some point we have to do something about. We just don’t know what to do about it clearly enough yet. For example, quantum computing. Everybody talks about how quantum computing will radically change the way we do automated trading in capital markets. But nobody knows exactly how it will pan out. One, because it’s very academic, and two, it has not manifested yet. Even the early version of it has not manifested, but we know it’s coming.

Those are the kind of things you think about in the five or six-year horizon. Assuming some of these assumptions were to be true, what is it that we should be doing to be a participant in that market and that ecosystem at some point.

Quantum Computing (11:02)

Pat: What is your take on quantum computing in the next five to ten years?

Chintan: The fundamental science will catch up in three or four years. I think industrialization and full-blown users are a little further out than that. I think we will see some very specialized use cases being deployed. Cryptography is one use case where traditional computers are going to become obsolete in the sense of quantum mathematical cryptography and so forth. That is going to be the first area where it actually will show up.

It won’t be general-purpose computing, at least initially. You’re not going to replace your desktop laptop with whatever quantum computer anytime soon. Specialized interactions and specialized computational situations in quantum will have a big role to play in the next six or seven years, more or less.

The other component, which has to be accounted for, is the operational cost of running a quantum computer. Right now, there aren’t many that can utilize quantum computing of any kind outside of academia and some companies of our scale. There’s a huge gap between what is possible practicality and academically.

Fundamental Shifts (12:34)

Pat: When I usually speak about innovation, I think about the synergies you mentioned, including what your customers want and what the business wants. Without fail, I cite the ATM as one of the greatest innovations of the most recent past.

You move value to the customer, it reduces your cost, and you charge them for that as well. Not only is it a cost-saver, but also a revenue generator. Is there anything that you see, in or outside of the baking industry, where innovation is going to have that kind of an impact?

Chintan: There are a few potential ideas like that. These are not new insights so to speak. People are already thinking about this and talking about this, such as a distributed ledger-based ecosystem. Smart contracts, real-time money movement, things of that nature are definitely going to be a huge opportunity to reinvent some of the things that we take for granted. Whether it’s process, regulations, or speed, there is a huge opportunity for capitalizing on them in those scenarios.

Outside of banking, I would say I am super fascinated by two specific things. How can electrification translate back into decisions that every industry makes? For example, how do you see the world when it comes to energy or power distribution?

I think those fundamental shifts in the underlying way we power our lives are going to have different impacts on different industries. It’s a very abstract answer, but I do think that there are parallel forces at play outside of banking, especially around green energy and how energy distribution is done. It will affect what kind of decisions you make around investment; where you invest, how you invest, where you localize, and where you globalize. It’s hard to predict, but I do think those would be the fundamentals.

Gig Worker Expectations (15:51)

Pat: You also spoke previously about the impact of millennial culture and gig workers and some of the things that you see having a significant impact.

I think we’re starting to see a lot of this with coming back to work, specifically post-COVID. I’d love to get your thoughts on this.

Chintan: Let’s unpack that a little bit and pick one piece at a time.

The typical gig worker is different from anything that we have seen before. The traditional mental model would be that you have a certain continuum to life. There are certain stages in life. Each stage in life gives you a different need. At what point do you need a mortgage? At what point do you need wealth advisory, and so on?

I’m talking very narrowly from banking as an industry, for example. How do you do work? Why is there an expectation of physical proximity when it comes to working? We lived through 18 months where physical proximity was not real. We still launched. We still did work. However, there is a difference of opinion where people believe that was temporary, and in that process, you lost the ethos of the company or the culture of the company.

What differentiates a person who walks in, looks at the same screen, works for company A or B? What binds that worker to any particular individual organization? The first assumption that we have to do away with is expecting that things will play out the way they have in the past.

They won’t, very likely. The notion of a gig worker is exactly that. As an individual, you are loyal to your life’s outcomes, your skills, and your niche passion, as opposed to a company. You will see this manifest in choices. Do I want permanent employment with the company or can I still make that kind of money, but not be tied to any one individual organization?

A gig worker’s needs structure changes as well. How do you enable them? How do they do financials? How do you do financial planning for somebody whose income predictability is completely off the chart versus what you would have expected in the past?

I think that will change a lot of the ways we do services from a financial services standpoint for them. Insurance is going to change a lot, the home industry or market industries are going to change a lot.

The way we do risk underwriting or risk profiling for these workers is going to be completely different. Today, when we do any sort of large transaction, we look at their past to make a judgment on the risk of this interaction in the future. If your past is not representative of your future, how are you going to make the judgment call?

What kind of things do you have to gather from a data and insight standpoint to be able to make those kinds of risk decisions, underwriting decisions, financial decisions, and so forth. It will shift a lot of our current thinking.

Success goes back to your first question. How quickly can you adapt to that change? If you’re going to get in your own way of that change, then you’re going to fall by the wayside. It doesn’t matter how big you are. It doesn’t matter how much legacy you have. The storied name you have doesn’t matter. Anybody who is not going to be able to keep up with that changing macro picture, won’t be around. Maybe some of the startups today who are thinking about this will become the behemoths of tomorrow.

Investing in Culture and Vision (20:53)

Pat: It is interesting to think how much has changed. I’ve heard from several organizations that their culture is dissipating. However, in many organizations, there isn’t a willful behavior to establish culture.

If you’ve ever read Enron’s core values, you’d see that they are diametrically opposed to how they operated. I do think that culture and vision are real assets for organizations, but I wonder how many are actually investing in that.

Especially in publicly traded companies, where their focus is much smaller than a visionary organization. They’re generally quarterly driven as opposed to a company like Amazon. Jeff Bezos is thinking in quarter centuries, not a quarter of a year.

Chintan: Firstly, I don’t think any company has a monoculture. Meaning there is no monolithic culture across any company. Except for some very small companies where there is a degree of cohesion, which is not practically possible in a company after a certain size or scale.

Most companies, after they reach a certain scale, have micro-cultures all over the place. When people say culture is a binding ecosystem, that means a common value system where we all collectively agree that this is the right statement. As a company, if you don’t have that shared value system and you can’t all agree with the statement, you need to stop giving lip service to culture.

Most firms will say, “we have a culture”. Whether it is a well-articulated top-down culture or just organically formed is where I think it differentiates. My opinion is that you cannot drive a culture unless you know what it is and where you’re going with it. Whether culture is articulated explicitly and being worked on explicitly or is bottoms up and very organic, every firm has a culture of some kind good, bad, or indifferent.

With a degree of cohesion, when people independently make a choice, they will be in the same ballpark because the principles that are guiding those decisions are similar. If you don’t have that similarity in guiding principles, then your decisions will be all over the place.

Pat: Agreed. To your point, it’s either an intentional culture or an unintentional culture. Was it defined? Is it reinforced? Is it something that you’re trying to grow? Or is it left up to whatever the team’s composite is?

I agree that when you get into larger organizations, those microculture concepts exist. Let’s look at the United States military. They are very focused on what they do, but the 10th mountain is going to do something a whole lot different than the CB’s. They’re all going to have their own core values, but the end game is the same thing - the overall protection and security for the United States of America. However, what they do and how they maximize their culture is going to be very different.

Remote On-Boarding (25:46)

Shelli: Have you had to onboard anyone remotely with COVID? How have you acclimated those folks to your culture?

Chintan: I have. In fact, a month ago, one of my direct reports joined from outside of banking.

They are still going through onboarding. We typically look at it as a 60-day/90-day exercise. I do think it’ll get to a point where this person in question will have to travel a bit to make some connections, have some of those physical interactions with people, and meet them face-to-face.

It is a hit or miss depending on how you go about it. If you join a new company in the middle of the pandemic, I don’t know how much of the value systems that we are talking about you’re absorbing. You’re still operating for the most part, but probably operating with the rubric of what you had before. You’re trying to piece together what is different about this new space. How does my approach need to differ here versus what it was in the previous place? You’ll see a lot of conversations about “in my previous place, we used to do it like this”, which is okay.

It’s not the best conversation to have six months into a new role, but nonetheless, it is still okay to do a compare and contrast and say, “In the previous place, I made a decision this way. How does it differ here?”

The way this was previously done took about four or five months for somebody to acclimatize. Nowadays, maybe it’ll take a year or more to get to the point where they feel the same degree of connection.

Shelli: It sounds like it is much more inorganic.

Chintan: Yes. I think the amount of culture you invite in a practical conversation is very different from what you invite in informal interactions, which aren’t happening right now. I don’t think this is solely about a new company either. If you switched teams as well, I think you’ll have the same sort of experience.

Mentorship (28:06)

Shelli: That’s a good point. Who are your mentors?

Chintan: I have a long list. I would say I have been lucky in having people who believed in the things I was doing. The big ones are my current leadership teams, Charlie and Saul. I’m the one telling them, “we did it like this in the past, but we shouldn’t be doing it like this in the future”. it’s big for them to trust my judgment call on that. They know I’m going to get it wrong; we are all going to go down the wrong path. The fact that they are believing and the fact that they play along is a big deal.

I have also worked with a few other people outside the industry who have perspectives, not formed by having been in one industry for a long time. I’m not going to name names, but these are people from the entertainment industry, people who work in technology, who have been able to give me an outside-in perspective. Which, organically, I would not have been able to get by myself because I’m not in those conversations all the time.

I would say, if the question was, how do you know that there’s somebody who can mentor you? It doesn’t have to be a formal thing. I would say, look for people who are going to question you in a way that you didn’t expect to be questioned. Or, actually ask you for a perspective, which you didn’t know you had to have.

Shelli: Alright, thank you.

Commitment to Improvement (30:06)

Pat: That’s great stuff. One thing that always impresses me with people who have had the same amount of success as you is their willingness to invite others into their lives to question them.

My wife thinks I have a very perverse affinity for these kitchen rescue shows. And the pattern is pretty clear that the kitchens are terrible because the chefs absolutely will not self-analyze themselves or do any remote questioning of whether or not their pizza from 1992 is still relevant today.

I think there’s a healthy level of insecurity that needs to be there for growth. You have to have some lack of confidence to actually analyze yourself with some honesty and then even more so to have the strength to invite other more successful people in your life to point at your shortcomings.

And I think that that says a lot about you and your willingness and your commitment to improvement. Innovation requires that type of vigorous and somewhat destructive mentality of getting to the future by destroying what’s made us successful this far.

Chintan: Thank you for the kind words. It reminds me of a military situation a few years ago. There was a spec ops force going deep behind enemy territory, and they found no resistance as they were. That spooked them. How the heck am I not getting resistance here? They backed out a little bit and that was good because it was an ambush waiting for them.

I draw a parallel to that. When I don’t get a lot of questions, I’m wondering, “what makes everybody think that this is okay?” If nobody’s asking anything, I need to figure out what’s going on there.

By and large, it is uncomfortable to be in those situations. If you’re forced into those situations, bring in an outside perspective or do it yourself if you are capable of taking a step back and rethinking everything. That’s essential. Without that, you will double down on things you should not double down and you will abandon things you should never abandon. And you will still succeed or fail. But the probability of succeeding is higher.

Pat: One of my favorite authors has this philosophy. To be successful, you have to make decisions and it’d be great if you make correct decisions. Anybody who’s been in a leadership position knows that no one is given that. How do you make a good decision? He’s quite serious about this concept of making good decisions and part of that is taking it seriously and learning.

You do expand the horizon of options by engaging others. Anybody who’s been in software or IT understands if it’s going too well, that’s a problem. Something is up ahead.

Chintan: The unknown...what are you missing?

Pat: That’s right. This is supposed to be full of friction. When it’s not, put your head on a swivel. Something is hunting you. You don’t know what it is, but it’s coming. Let’s find out sooner what’s coming.

Imposter Syndrome (34:07)

Pat: One last concept that I hear a lot when I talk to successful people is imposter syndrome. It’s something I think we need to talk about more. Everybody has it, right? Do you feel like an imposter sometimes? Do you ever have doubts and wonder if you can truly do something?

Chintan: Yeah. I don’t think of “fake it until you make it” as a bad thing. What is bad is not knowing that you’re faking it.

Pat: There is a whole thing right there.

Shelli: Yeah, that’s another whole podcast.

Pat: Oh my God. Delusional or intentional?

Chintan: To a large extent, I think that the imposter syndrome is okay as long as you know what’s real versus what isn’t real, and you can employ your higher faculties to understand what’s needed. There are enough examples across the industries where you can say trying to be a certain way leads you to be that way.

Sometimes I go ”this is not the real one, but we have to keep at it until we get to the point where that becomes organic for us as a team, as an individual, as a group.” And I don’t think it’s a bad thing. Now, it is bad though, if you don’t know that you are in that bucket. Trying to look like something that you’re not is very different from trying to be something you’re not yet.

Pat: That’s very interesting. There’s a show about the Fyre Festival on HBO. It’s about a big music festival in the Bahamas. The guy running it is just completely diluted on what he’s able to pull off. I wrestled with this. Every good entrepreneur has to fake it until they make it.

Entrepreneurs can’t sit back when it gets hard and say we really can’t do this. If it was done, you’re not an entrepreneur anymore. You’re just an imitator, right? I think about the degrees of fake it until you make it. You have to have the capability to do it. If you’ve never done it before, don’t have the money, or the intelligence, or the organizational structure, it could be closer to delusion. That would be like the Fyre Festival example or Theranos.

Chintan: Let’s look at the example you used with Theranos versus something like SpaceX, for example. I don’t think in the beginning two years, anybody would have argued that Elon Musk was talking reality. That suspension of disbelief has to be there when you take on such a big endeavor. What stops you from losing yourself in that disbelief is that you still know the difference between what is ambitious versus I believe that I’ve already done it. At what point do you detach yourself and go, “it’s hard, and it’s hard because nobody has done it, and we’ve got to keep at it”. Versus I believe we’ve already done it and we deserve everything which comes with it.

Pat: Oh man. That’s great stuff. Well, I know we could probably keep going for another 50 years. Thank you so much for joining us today. I really appreciate it.

About Our Guest

Chintan Mehta is the Chief Information Officer and Head of Digital Technology and Innovation for Wells Fargo. He is also a member of the Wells Fargo Technology executive leadership team. Chintan has joint reporting relationships with the Head of Wells Fargo Technology as well as the CEO for Corporate Strategy, Digital Platform & Innovation business.

Chintan has a master’s degree in computer science from the University of Hertfordshire in the United Kingdom. He is based in San Francisco, California with his wife and two children.

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About Patrick Emmons

If you can’t appreciate a good sports analogy, movie quote, or military reference, you may not want to work with him, but if you value honesty, integrity, and commitment to improvement, Patrick can certainly help take your business or your career to the next level. “Good enough,” is simply not in his vernacular. Pat’s passion is for relentlessly pushing himself and others to achieve full potential. Patrick Emmons is a graduate of St. Norbert College with a Bachelor of Science degree in Computer Science and Mathematics. Patrick co-founded Adage Technologies in 2001 and in 2015, founded DragonSpears as a spin-off dedicated to developing custom applications that improve speed, compliance and scalability of clients’ internal and customer-facing workflow processes. When he is not learning about new technology, running a better business, or becoming a stronger leader, he can be found coaching his kids’ (FIVE of them) baseball and lacrosse teams and praising his ever-so-patient wife for all her support.

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