Mark Steffe of First Command Financial Services

    We Spoke to Mark Steffe of First Command Financial Services on Being an Effective Leader During Turbulent Times

    As part of my series about the “Five Things You Need To Be A Highly Effective Leader During Turbulent Times,” I had the pleasure of interviewing Mark Steffe.

    Mark is the President/CEO of First Command Financial Services, which provides personal financial coaching to more than 280,000 client families around the world. Mark is responsible for guiding the organization in its efforts to make lifelong financial security possible for all military families. Adhering to the fiduciary standard, First Command accomplishes this by creating lasting bonds with clients through face-to-face coaching and empowering them to develop positive financial behaviors for every stage of their lives. First Command is headquartered in Fort Worth, Texas, and has more than 175 offices worldwide. First Command maintains $30 billion in managed accounts and mutual funds and has $60 billion in life insurance coverage in force, while First Command Bank holds more than $800 million in deposits.

    He lives in Fort Worth, Texas along with his wife and five children. On any given day off, you can find him attending one of his children’s sports games or cooking family dinners together.

    Thank you so much for your time! I know that you are a very busy person. Our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?

    I grew up in Colona, Illinois, and graduated from the University of Illinois with a bachelor’s degree in finance. I have devoted my career to helping others pursue financial security. I hold Series 7, 8, 23, 63 and 65 securities registrations, as well as life and health insurance licenses. Before joining First Command in 2010, I worked for Kemper Securities, Inc. (now part of Wells Fargo), UBS Wealth Management (formerly known as PaineWebber), Harris Bretall Sullivan & Smith (a Registered Investment Advisor headquartered in San Francisco that is now part of Federated Investors), and TIAA-CREF (now TIAA) in various wealth management roles.

    In 2010, I joined First Command as the Chief of Staff for Advisor Operations. In this role, I developed programs and resources to strengthen First Command’s sales force, while also coordinating communications to the company’s Field Force and acting as a conduit for feedback from the field to the Home Office in Fort Worth. In 2012, I assumed the Director of Advisor Operations position for First Command’s Midwest division, leading sales growth, market penetration, leadership development and recruiting efforts in a nine-state area. I was promoted in 2014 to Executive Vice President as the National Director of Advisor Operations. For three years, I catalyzed growth and increased productivity among First Command’s sales force in this role. The common thread in each of these positions at First Command was my focus on building strong, collaborative relationships between Advisors in the field and the home office, enabling them to help clients more effectively and efficiently reach their financial goals.

    I became the President of First Command in 2017, later adding the responsibilities of Chief Operating Officer to my portfolio. During this period, I began working with First Command’s previous Chief Executive and others in the company on a strategic succession plan, which culminated with me assuming the President/CEO position at First Command at the beginning of 2020.

    Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘take aways’ you learned from that?

    About five years into my career, I was working in a sales role in Chicago for a financial services firm that was then known as PaineWebber. I was assigned to a geographic area that spanned from Indiana to Colorado and was responsible for helping financial advisors in my territory convert from commission-based businesses to fee-based asset management services. In my sales role, I was paired with an analyst who helped put proposals together for the advisors in our area when they needed things like asset allocation analysis or research on asset managers for a client. Fairly often the advisors in the field would call us with questions about the proposals we’d put together, and it occurred to me that there might be times when we weren’t available given the size of our territory. I thought that creating a reference guide for every office that defined terms, explained various charts and provided a script to help the advisors when they were in their client meetings would be helpful when we weren’t available to answer their questions. So I proposed it to the analyst and asked if they could build it. They agreed that it would be useful and compiled the guide, which I took to New York the next time I went there to meet with my boss.

    I showed him the binder and explained how we were using it in our division, and he liked it. He then asked who came up with the idea, and I told him that it was my idea but that the analyst had done all the work putting it together. He wanted me to show it to some of the other senior leaders in the corporate office, including the guy who ran the entire department. So we walked through the office and each one asked a similar question about who came up with the idea after I talked them through what it was and why we created it. And I repeated the same thing I told my boss each time, saying that it was my idea, but the analyst was the one who actually built it. By the end when my boss and I got back to his office, I was excited about all of this exposure I was getting with some of the most senior people in the company.

    We sat back down in his office and he asked me how I thought it had gone. I told him that I thought it had been great, and he responded with something that has stuck with me to this day when he asked, “why did you have to tell people it was your idea?” I responded by saying that it was, and he followed up by saying, “But was it necessary? They could probably guess that it was your idea and, even it wasn’t, wouldn’t this have been a great opportunity to just show people what the analyst could do?”

    He could have told me that before he took me to meet with these executives, but instead he walked me around and let me dig myself into hole after hole. And because he did that, I learned a lesson that will be ingrained in me for the rest of my life. It doesn’t matter who gets the credit. What you should really be focused on is doing work that is effective, productive and helps people. In the 24 years since that moment, that’s how I’ve approached every day.

    None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story?

    I’ve had many mentors along the way, and I’m grateful for each of them and their willingness to help me grow. My parents were the first people in my life who helped me get to where I am today by instilling in me a strong work ethic and an understanding of the importance of staying humble. One of my first mentors after I started my career passed on a piece of advice that has always served me well, which was to “just be real.” What he meant by that was that if you’re relatable and you do the right things, you’ll almost always be ok. I learned more just watching another mentor and seeing the way he treated people and how well he knew the business. That became something for me to emulate. I learned from another person that I consider a mentor how important it is to ask questions. When someone was trying to sell him on an idea, he’d ask question after question. He never hinted what he was thinking and it wasn’t ever clear which way he was leaning on a decision until he was satisfied that he had enough information to make a good choice and could be confident that whoever was answering the questions knew what they were doing. It wasn’t micromanagement, but just seeking to understand. That was an important lesson for me.

    The most consequential mentor in my career, however, was likely Scott Spiker, the previous CEO of First Command. I’ve known him for about 11 years at this point and he has always been committed to making sure that I could be successful. Often that required him to make personal sacrifices in the process. From the moment I was chosen as his future successor around four years before the transition took place, Scott began working collaboratively with me to map out a plan that would prepare me to effectively lead the company. Throughout the course of the succession planning process in the ensuing years, he shared everything with me as we worked side-by-side. This was extremely helpful for my learning process as we did the work and I prepared to eventually move into his position without a sudden learning curve on day one in the role. It’s not always fun giving people constructive feedback, and working closely with me was an investment of time for him, but he never backed away from it because he understood how important it was to help prepare me as I worked through a long-term development plan leading up to the transition. It was always very clear to me that once the decision was made that I would succeed him as First Command’s Chief Executive, he was totally committed to making sure it worked out well. I’m grateful for his belief in me and in his willingness to invest in my career.

    Extensive research suggests that “purpose driven businesses” are more successful in many areas. When your company started, what was its vision, what was its purpose?

    First Command’s founding was the result of one man’s desire to improve the lives of military families by coaching those who serve in their pursuit of financial security.

    As a B-29 aircraft commander stationed on Guam during World War II, Carroll Payne lost 24 of the 44 crew members in his flight of four aircraft. Acting as summary court officer, it was his responsibility to notify their families. He learned that, in addition to the personal tragedy of having lost a husband, a father, or a son, these families had also lost their breadwinner. Having grown up with five siblings and no father on a sharecropper’s farm during the Great Depression, he empathized with their situation.

    In the years immediately following the war, Payne was stationed at Eglin Field in the Florida Panhandle. Years later, he would recount how the officer’s club would fill up with military retirees toward the end of each month. They hung out playing poker and gin rummy, eating and drinking on credit because their retirement pay had run out. As his own retirement from the military approached, Lt. Col. Payne reflected on the financial struggles he had witnessed and resolved to help other military families avoid a similar fate. In 1958, he began laying the groundwork for the company that would become First Command.

    Today, more than 60 years later, our commitment to improving the financial well-being of service members and their families remains our driving force — just as Lt. Col. Payne envisioned.

    Thank you for all that. Let’s now turn to the main focus of our discussion. Can you share with our readers a story from your own experience about how you lead your team during uncertain or difficult times?

    On January 1, 2020, I became the Chief Executive of First Command after the succession planning process I described earlier. As a result of the thought and preparation that went into the succession, I had a clearly defined plan for my first few months in the role. Among my highest priorities were to ensure that our Advisors, employees and clients got to know me as the new leader of the company, as well as moving on our plan to enhance our digital offerings to clients. Both processes were underway but, on day 70 in my new role, everything that had been meticulously thought out during the previous four years took a backseat after the pandemic was declared.

    Far more important than those plans was ensuring that our employees and Advisors were safe and had what they needed each day to do their jobs well, that our clients were getting the information and support they needed to make sound financial decisions as the bottom fell out of the market, and that First Command would be able to continue to deliver the personalized service that our business has been based on for more than 60 years in a totally unfamiliar environment in which everything had to take place virtually.

    First Command had always been an in-person company, and our Financial Advisors providing face-to-face financial coaching is one of the things we pride ourselves most on. As soon as it became clear that conducting any business in-person was going to create unnecessary risk, we quickly adapted our proven, personalized approach to be offered virtually. Our experience since March has shown that we can maintain the high standards we set for face-to-face, personalized coaching without physically being in the same room as a client.

    I believe that constant communication and a willingness to quickly adapt as circumstances change have been essential to my ability to lead First Command through this period of uncertainty. Our Advisors are based all over the world, and we need to know what they’re experiencing in the field to quickly make good decisions from Fort Worth, Texas as circumstances change rapidly. The internal infrastructure we created to bolster two-way communications through a Coronavirus Resource Center has been invaluable in keeping everybody on the same page, which leads to better outcomes for clients.

    Did you ever consider giving up? Where did you get the motivation to continue through your challenges? What sustains your drive?

    No, quite the opposite. For more than 60 years, First Command has helped coach military families through all stages of life. Today, around 280,000 families entrust us to help them pursue financial security. The pandemic has created significant economic challenges for many people, but military families have faced circumstances that have amplified those challenges like delayed relocations and job losses among military spouses that have further strained family finances. We provide a service that has become even more important to them as they have searched for the best approach to protect their finances and plan for the future at a time when it’s difficult to know what the future may bring. All that is to say that giving up isn’t an option when First Command is exactly what they need to get through this crisis.

    I was out of town with my wife on a short trip when the scale of the pandemic became clear in mid-March. As I was reading about COVID-19 and watching everything start to shut down, I knew I needed to jump into action so that we could avoid being reactive to everything that was clearly headed our way. My goal was to get as far ahead of the major challenges as possible. I spent the rest of that long weekend working with our team at First Command to race ahead of the turbulence that was coming, and we got as much control over the situation as we possibly could get early on. In retrospect, that probably wasn’t a lot given the circumstances, but the harder we worked at it, the better I felt about the direction we were headed.

    What would you say is the most critical role of a leader during challenging times?

    The simple answer is to lead. When things are turbulent and there’s lots of uncertainty, it’s not the time to delegate or offload responsibility. It’s the time to be up front, up close and personal, because others are looking for direction and need to know that the person they’re following is competent and committed to doing the right thing.

    One example that comes to mind for me in my experience during the first few weeks of the pandemic. First Command needed to communicate with so many people during that period to reassure them that we had things under control and were taking all the steps necessary to confront the immediate challenges of the pandemic while also thinking ahead to what was coming next. We quickly ramped up our internal and external communications to fill what amounted to an information void that many of our clients, Advisors and staff were feeling amid all of the uncertainty about what was happening in the world. Prior to the pandemic, we managed approximately 30 communications per month. In March, that number rose to 50. In April, it increased again to 60. I certainly didn’t write all of them, but I did review every single one before they were sent to be sure the tone matched the message I wanted First Command to convey and that it was clear in every communication that we were putting people first in all of our decisions. This is just one small example, but I think it’s emblematic of what a leader needs to do during challenging times. If you’re not willing to go the extra mile to ensure things are headed in the right direction, the people who are following you pick up on that.

    When the future seems so uncertain, what is the best way to boost morale? What can a leader do to inspire, motivate and engage their team?

    The answer to this question depends upon the culture of the organization. At First Command, the things that I feel are most important are to be honest, offer some humor when it’s needed and demonstrate confidence that our core values of courage, love and effectiveness that have gotten us through more than six decades of ups and downs will get us through whatever the current challenge may be. Throughout the pandemic, we’ve continued to find ways to maintain the culture of having fun and enjoying collaborating with one another while we get our work done. We can’t do that in person right now, which is a definite challenge, but that hasn’t stopped us from doing virtual holiday celebrations, trivia contests, happy hours and all of the other types of events that make the work experience more than just a job. There may be business realities that are unavoidable that threaten morale, but when they are approached transparently and people continue to come first, they don’t become crippling moments.

    What is the best way to communicate difficult news to one’s team and customers?

    Regardless of what the news is, it needs to be delivered honestly. Don’t tell people things you don’t believe or don’t have an answer to. And if you don’t have an answer for them, let them know that you don’t but that you will tell them whatever you can with the information you do have.

    How can a leader make plans when the future is so unpredictable?

    I’m a strong believer that as a leader, you have to make your plans as best you can with the information you have available to you, but you also have to be willing to adjust course as new information comes in. The pandemic has illustrated this point perfectly. At the beginning, there was an enormous amount of uncertainty about what it was that we were even facing, let alone how to deal with it or the timetable that might be involved in doing so. But that didn’t mean that everything could stop until things became more clear. We made a decision at First Command to send everyone home to work remotely on March 13 last year, which was much sooner than many companies, and before the State of Texas advised doing so. We made that decision because we saw what was coming and knew it was the right thing to do to protect our staff.

    Our business continuity plan was solid and allowed us all to begin working from home without a drop-off in productivity, but a sudden shift to remote work was certainly not something that we were actively planning for in the months leading up to last March. From there, we reassessed the situation daily and continued to make decisions and choose what direction we were going whenever new information was available. If you are inflexible as a leader and unable to adapt, or if you get paralyzed because there are too many variables in play when things are uncertain, it becomes impossible to plan and execute anything.

    The analogy I’ve used before is having two buckets. One is the “here and now”, and the other bucket is “the future”. Every decision you make goes into one of the buckets, and it’s a matter of balancing them. If you’re doing too much today for the here and now, there’s a good chance it will destroy something in the other bucket. If you spend all of your time planning for the future, there’s a good chance you won’t be able to take care of what needs to happen today. It takes extra time and effort to manage both simultaneously when you’re in a crisis, but if you don’t do it, you can’t succeed.

    Is there a “number one principle” that can help guide a company through the ups and downs of turbulent times?

    Never lose sight of your mission and embrace the core values that define you. It’s important to do that when things are going well, but it’s the only way to succeed when they aren’t. More than 280,000 families — the vast majority of whom are military families serving our country — count on First Command to coach them in their pursuit of financial security, and turbulence can’t stop us from delivering for them. In the first few weeks of the pandemic, when there was very little reliable information about the virus and the financial markets were tumbling, our clients were experiencing significant uncertainty about their household finances. Our charge was to provide them with that support at a time when our own operations were being disrupted in a way that fundamentally challenged our business model.

    We immediately focused on how we could adapt to ensure that we were as accessible to military families as we were before the pandemic. Without that, our mission to provide them with the guidance and coaching they need to pursue lifelong financial security would have been impossible. Through all of the changes that have occurred in the months since, we’ve also continued to lean into our core values of 1) Courage, by acting with integrity and treating others with respect; 2) Love, by putting others’ good ahead of our own, and; 3) Effectiveness, by refining our commitment to service and authenticity. Our culture has always been based upon keeping clients at the center of everything we do; they serve our country and we exist to serve them. The way we conduct our business has changed in response to turbulent times, but every decision we’ve made has been designed to keep clients at the center of our work. That is what has helped us succeed during an extremely turbulent time.

    Can you share 3 or 4 of the most common mistakes you have seen other businesses make during difficult times? What should one keep in mind to avoid that?

    We’re coming off of a year where there were ample opportunities for mistakes, and my perception right now is shaped by the experience of the pandemic. If I had to pinpoint the most common mistakes I saw in 2020, I’d narrow it down to the following:

    • Inflexibility: We’ve all seen leaders that stick to a decision under any circumstance after they’ve made it. But when you’re in a period of crisis, or just a difficult time, that approach generally doesn’t work. As things are changing rapidly, you need to be able to adapt to them, and if you’re not willing to change your mind, you’re likely missing opportunities to pursue courses of action that the moment demands.
    • Business Above People: This is a mistake that should go without saying, but unfortunately there were examples of companies falling into the trap throughout 2020. How companies handled remote work vs. office-based work last year is the most prevalent example. At a time when there were significant health risks by having people come into work when they could easily work at home, too many companies chose not to put their people first. Whether you’re in a once-in-a-lifetime pandemic or in a short-term rough patch, people will never forget the feeling they had when their wellbeing was not the priority. The flip side is that when you put people first and take care of them during a difficult situation, they will take care of the business in return. Putting them first can also take many forms. Helping reassure them that their jobs are secure and that you care about their wellbeing are critical at a high-level, but something as simple as providing more flexibility in work schedules or gracefully accepting that kids might wander into video calls periodically made a big difference last year.
    • Panic: You need to exude competence. Not that you have all the answers, but you have to understand your business, know your numbers, and figure out how you’re going to steer the company and make sure it’s going to be okay. Panic clouds judgment and often leads to poor choices.

    Generating new business, increasing your profits, or at least maintaining your financial stability can be challenging during good times, even more so during turbulent times. Can you share some of the strategies you use to keep forging ahead and not lose growth traction during a difficult economy?

    The most important thing anyone can do to avoid losing growth traction in a difficult economy is to be prepared before it happens. In our five-year planning, we structured things with the expectation that there would be a bear market at some point during the five years. We didn’t know exactly when it was coming, but the assumption was that there would be one. So, we didn’t wait for it to happen to take the steps we knew would be necessary to avoid a drag on growth when the economy wasn’t as strong. We had been reducing our expenses as a result. When the pandemic began and the economy caved in as quickly as it did, we still had to adjust, but we were making the necessary changes from a much stronger position than we would have been had we not had a plan in place already for what to do when the downturn arrived. When we put pretty dire estimates into our financial modeling early in the pandemic to see where we stood, we quickly saw that we were going to be fine. Continuing to grow in circumstances like these requires that level of foresight in almost all businesses.

    Here is the primary question of our discussion. Based on your experience and success, what are the five most important things a business leader should do to lead effectively during uncertain and turbulent times? Please share a story or an example for each.

    1. Embrace Proactivity

    I mentioned before that heading into the pandemic, we had already written into our five-year plan how we would approach a bear market. Clearly, the pandemic created financial challenges that were very unique and was not something that you’d be able to plan for with any degree of certainty. But the fact that we had already taken actions to become a leaner company by the time the pandemic began gave First Command a head start as many companies were just beginning to consider how their financial situation was going to be impacted by the changes in the market.

    Our business continuity disaster plan was also crucial when we decided to shift to a remote work model for most of our staff. There were still challenges, but the basic structure of our response followed the plan we had prepared in advance for a variety of threats that could disrupt normal operations. As the leader of the company, I was comfortable that with my understanding of the business, the team we had in place, and the proactive steps we had taken in the past to plan for uncertainty, First Command was going to be OK regardless of the circumstances we faced.

    2. Communicate Honestly and as a Human

    During uncertain or turbulent times, everyone has questions. Employees are likely wondering whether their jobs are secure. A board will generally have questions about what the plan is to deal with turbulence. In our case, Advisors will want to know what kind of support the company will provide to help them through the crisis. Clients want to know that you’re there for them to help them deal with their challenges. At the beginning of the pandemic, health and safety was on everyone’s minds.

    We didn’t think we had all of the answers, but it was important for every one of our stakeholders to know that we weren’t panicking and that we had a plan. Most importantly, and going back to the value of proactivity, we wanted them to know this before they came to us with questions so they weren’t wondering whether we were on top of it or if we would have communicated with them had they not asked.

    The pandemic was also a perfect example of a time when business concerns and the human element of uncertainty intersected. This was an issue that literally affected everybody, not just those with a stake in First Command’s success. That meant that we had to acknowledge the incredible toll the situation was having on those we were communicating with and lead with that in everything we said and did. Doing that and being honest about what we didn’t know yet made everyone far more comfortable with the situation and went a long way toward instilling a sense of confidence that everything would work out.

    3. Lead Here and Now, but Never Lose Sight of the Future

    During times when there is uncertainty about what the future may bring, it can be easy to fall into a trap of dealing only with what’s right in front of you because that’s what is the most urgent. But whenever your decisions focus only on the here and now, you’re putting your future at risk. Finding a balance between leadership in the present while still planning for the future is the only way to get through a crisis unscathed. One example of that at First Command in the past year was a decision we had to make about our deferred compensation plan for Advisors in the field. Our plan is a bit unique in the fact that it has a cash component that pays at the end of each fiscal year. Rather than waiting until the end of the year to make the cash payment like we have done traditionally, we front loaded a significant portion of the payment in 2020 to get cash into Advisors’ hands to ensure they could meet their needs at a time when they were going above and beyond to help our clients stabilize their own finances.

    We knew there were a variety of long-term implications before the decision was reached, including whether doing so would become a precedent moving forward and whether we’d be able to recoup it at the end of the year if an Advisor left after receiving the compensation. But there was a need right then that we knew we had to meet, and we were comfortable that we were striking a balance between the here and now and the future that would put our company and our people in the best position to succeed.

    4. Don’t Overact; Don’t Underreact

    On March 13th, 2020, we sent everybody to work from home. It was a hectic time when everyone was unsure of what was happening, but we made a quick, decisive decision that we felt strongly was in the best interests of our team. We made this decision before many other companies, but I could just feel that it was the right thing to do. There was clearly a trend, and it wasn’t going to turn around anytime soon. We didn’t know how long everyone would be working from home, but we did know that making the decision to shift to a remote model was what was best in the moment. We never anticipated that it would last for 10 months and counting, but it was still the right decision either way.

    An underreaction in that situation would have been to wait until it was too late to send people home after more information was available and, likely, after people started getting sick. An overreaction would have been to close entirely for any length of time while we waited for more information about what was happening in the world. We found a balance that we were comfortable with and trusted that our systems and processes could be adapted to continue operating at an extremely high level despite the circumstances.

    5. Become an Information Junkie

    At the very beginning of the pandemic, I started to get a sense of how monumental the problem was as I watched and read news reports over the course of a weekend. I called our Chief Financial Officer on a Sunday to talk about our financials, and she was already all over it. The next day we were able to review everything closely to see how different variables would affect us based on how bad the pandemic got. We determined that we were in a strong position, but knew that the situation would continue to evolve and that we needed to have as much information as possible each day to make the right decisions about how to steer First Command through the crisis. Everyone on our Executive Leadership Team was reading updates as they were available from the CDC and other scientists and making sure that when a decision needed to be made, we had the best information we could to guide our thinking. The result of that was that we were able to make rational choices regardless of the external factors. This is a principle that transcends any situation and any individual business. If you want to make good choices, be sure that you have the best information you can gather before committing to something that you can’t come back from.

    Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?

    “Do the right thing.”

    This is something I heard from one of my mentors early in my career. As cliche as it sounds, it’s an easy rule to live by, it’s hard to forget and it will never steer you wrong. It has served me well throughout my life, and it has been more important than ever in the past year during the pandemic. There are people at First Command who count on me to make good decisions, and we have hundreds of thousands of military families who count on all of us to do the right thing for them. 2020 was a stress test for every organization, and there were countless unknowns. But in all of the decisions that needed to be made, I trusted my gut and went with what felt right. There are only four words in the quote, but they pack a big punch.

    How can our readers further follow your work?

    First Command is active on FacebookLinkedInTwitterInstagram and YouTube, and I’d encourage them to follow our work there to learn more about how we’re helping service members get their financial lives squared away on a daily basis by coaching them through all stages of life. I’m also active personally on LinkedIn, where I post both about First Command and topics like leadership, issues that impact military families and more.