John Bell: When you stop learning, you should retire
B.Erdenechimeg Journalist

The CEO Series continues. This time, GoGo Mongolia interviewed John Bell, CEO of Khan Bank. We talked in a chronological way, starting from his childhood, high school, and university years, and touched on his career as a banker in different countries.

-Where were you born and raised? 
-I was born in Albuquerque, New Mexico, on a military base in the mountains. My father was a captain in the army, he was based there for a few years. I haven't been there since then, we left when I was very young. We moved to Illinois, and I grew up in Illinois, 200 miles southwest of Chicago. I spent the first 12 years of my life there, then we moved to Chicago. The town I grew up in was a farm town. Illinois is farm country, corn, grain, beans, soybeans, a lot of pigs, and cows are there. One of Chicago's nicknames is the "hog butcher for the world".  There are a lot of stockyards in Chicago. Now it's a commodity market. But I don’t know much about farms, because my father was a lawyer. We lived in the city.            

-I was told you liked watching sports, especially American football? What team are you a fan of?
-I grew up playing a lot of sports. My favorite sport is football, as you can see. In fact, I have a helmet in my office that was signed by my favorite athlete, my hero. The team is the Chicago Bears, and the athlete’s name is Dick Butkus. It's actually a real signature. He played as what we call a middle linebacker, which is a very rough position on the field. That was one of the positions I played when I was in school, because I liked the roughness of that position. On the football field, that position is sort of the center of the field, and you have to be very aggressive to play that position.             

I fell in love with American football. My first organized game was probably when I was 7 or 8. At that age,  we don’t do full contact, basically playing flag football. I was very fast as a child. When I was younger, I was big, I grew fast. In my early years, everybody had sort of high hopes about my athletic future. Unfortunately, I stopped growing. This is pretty much what I looked like when I was in eighth grade. People used to say that I was going to keep growing, but my genes stopped me there. My grandfather played football too. He played for a university team and was a star of the team. I have a rich tradition of people who love this game. Obviously, it was a good environment, because my father and grandfather were both good players. When my grandfather graduated, the Great Depression happened in the USA. So, instead of going on in his career, he had to go to work to support his family. He wasn't able to pursue anything more with football.    

-Did you ever get hurt while playing American football?
-Actually, I broke bones in most of my body, all of my fingers and in my legs; some from football, some from baseball. I broke my left leg twice in the same year, while playing football. I was 11 years old. My brother got a concussion from playing football. It's probably not a great sport to play for a long time. 

Unfortunately, I wasn't able to play anymore, because of my size. So, I started doing other things, such as golf and tennis, which don't require massive physical talent. But I still love sports. Sometimes I feel like I can play football again. For the last 25 years, I've just never been in a country where you can find people to play with, because I've lived outside of the U.S. since 1996.               

-We'd like to move on to your secondary school years. You must have been good at math. What other subjects were you interested in?
-In high school, I was good at everything. I think, in my high school years, I was quite introverted.  I didn't have many friends. My friends were the librarians. I was very much into books, studying, and getting high grade point averages in order to get into university. I was very passionate about that. At that point in my life, my parents got divorced, and maybe I took it very hard. Probably, instead of worrying about my parents’ divorce, I just devoted myself to what I thought I could control, which was my schoolwork. The graduating class was 1,000 people. I was 67th out of a thousand. There were 66 people ahead of me, but my grade point average was higher than the top students'. My grade point average was 4.27 and the high achievers had 4 points. There were some advanced placement classes they took, and they got higher ratings for those classes. So, I graduated from high school very well.                

I studied very hard, but I still played some sports. I also worked a lot, not only at school, but outside of school. My first real job was with a company called Crate & Barrel, somewhat like Ikea, but a little more up-scale than Ikea. I worked in the stock room. I used to work about 16-20 hours a week back then. I think I was paid $3.25 an hour. It was good. 

-You said a real job? That means you hadn't had real jobs before? 
-My first job was delivering newspapers, when I was 12. My younger brother and I woke up at 5 a.m. and we had a boss. We were very young kids.      

Then, in school, I didn't have a social life, but I had a lot of extracurricular activities. That was encouraged by my parents, to balance school and something else. My parents required me to have a job when I was in high school, to start saving money for university, because university in America can be very expensive. Even back then it was expensive. Having a job gave me pocket money, and also helped me to begin saving for university.

Also, it helped me learn how to organize my time and prioritize what’s important, and to be more effective. I didn't have a lot of free time when I was in high school, I was either studying, going to school, or working. A lot of stuff I did outside of school helped me understand business, how to manage a business. At a very young age, I was sort of involved in retail. Sixteen is the legal age in the U.S. for minors to work without permission from their parents. Younger than 16, you have to get permission. My parents were very happy and told me to please go work. 

That was very tough stuff too. Chicago is very cold. We lived outside of the suburbs. I had to go 5 miles to get to work. I used to ride a bike, whether it was winter or summer. It builds some toughness in you, to make sure to be there on time, no matter if it rains or snows. I don't know why I didn't take the bus. Probably because it was easier to take my bike.                                    

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-Were you the “brain” of the class? What do you call top students in class in the U.S.? 
-It depends on who you ask, "teacher’s pet" or you can say "he’s a brain of the class".

-Which one were you?
-I wasn't either one. In university I wasn't. It was a bit of an awakening for me, on sort of being on my own, being independent, and I was much more reflective about my life, what I wanted to do in my life. In my university years, I used to explore different ideas, different philosophies and religions, different literature, approaches. It was a very interesting part of my life. I graduated, but I wasn't only focused on grades.

In university, it was a sort of about experimental, intellectual exploration in my life. I still worked a lot, I had a full-time job. My father told me that, for the first year, he would help me with my educational expenses, but for the next three years, I had to do it myself. So, I got a job. In my freshman year, I was a budding champion at ping pong. It was fun, I had a good time there.

In the beginning, you take a lot of required classes. As more years go by, you get to select different classes, so you can decide which way you go. Of course, you have to take all economic classes and stuff like that. When I was 21, I was interested in economics. I didn't really go to school to be a professional at that time in my life. I just wanted to understand the world, understand myself better, to give myself some tools to be reflective, to be a better intellectual. I didn't treat university as a vocation. My parents got very upset with me, because they said, "What are you going to do with those crazy, intellectual, philosophical questions?" I didn't have an answer.

I thought maybe I was going to be a lawyer, either go to law school or become a teacher, but I decided to do neither. I ended up doing something completely different.

-What university did you go to?
-I went to Loyola University in Baltimore. It's a very good school, a business school actually. Jesuit education is known for the humanities, but this particular school is known for its business school. Since I've graduated, it's become an even better business school. My family has a long history there. By the time I was in university, I'd worked for 3 or 5 managers who were not my parents. Most of what I've learned about management came from all of the managers that I worked for throughout my life, starting with my parents.

My father is pretty tough; my mother is even tougher. Somehow, she was my first job. I mean, she constantly gave me something to do and managed me. Every time you work for an organization as an employee, somebody is supervising you. You're learning. Some of them are good and some of them are bad managers, you learn from all of them. A good one teaches you what to do, and positive things, and a bad one shows you what not to do. I think, in my life, I've probably had 20-30 managers I've worked with and learned from.

Education is a means to your profession. I learned a lot about what I do today from real life managers, who helped mold my views on being a manager. I feel very privileged to have that experience behind me, and those experiences guide my decisions today. Just sitting here thinking about different people I worked with, who managed my job, my activities, these were not glamorous jobs. I mean, I've done a lot of normal jobs, that normal people do. Each person you work with you learn from every step of the way. When you stop learning, you should retire. Even today, I learn. If it's not learning from people I work with, I learn from people who I engage with outside the bank. Life is a learning process. When you're learning, you give back. Even though I don't have a glamorous education from Harvard, Yale, and all those big universities, I don't think I would have gained the same experiences from that at all, because I’ve worked with very good people. 

-Why did you choose to be an economist?
-Banking came to me a little bit by accident, basically, out of necessity. I was working for the government in Poland from 1991-1993. I came back to Chicago. At that point, I needed to find a job. I was doing a retail job at Crate & Barrel. At that time, Citibank was looking to transform itself from being sort of a conservative, not customer-focused organization, to a more customer-centered, more retail and service-focused bank.

They were looking for individuals who had retail experience. I was at my sister’s house, having coffee. She had a newspaper and I looked at a Citibank announcement. Soon, I started working as a teller at Citibank. Basically, we call them customer service representatives, we don't call them tellers. We did everything from sales to service, exactly what tellers do here. I think I fell in love with the international aspect of Citibank. Because I had worked outside of the U.S., I was looking to do the same thing. Citibank offered me an opportunity to go back abroad, to another country. They just wanted me to help them to build a branch, so I started off working in a branch. I spent a few years there. Then there was an internal newsletter that said we're opening a consumer bank in Poland. I said, "Oh, I want to do that," and told my boss about it. Basically, to set up a bank, to be a part of the team wasn't possible for me to do in the U.S.

Since 1996, I've never been in the U.S. to work. Citibank is a global bank, and I thought it would be a nice opportunity, and I knew it would be more money than I was getting. At that time, I needed money. I was interested in doing something more international, and that would also gave me a higher salary. It was a very good experience for me. I worked there for 11 years, and it taught me everything about commercial banking. I had seriously great managers who helped me to understand what banking is. Also, to understand how to manage a business and people, control the bank, etc. I really appreciated that 11-year education I had.

-So you speak Polish?
-Yes, I was very dedicated to learning Polish. I wanted to prove to myself that I could learn a foreign language. In fact, I learned it very well. I started to forget English. I had trouble speaking in English fluently, I had to think of words. So I was really immersed in the Polish language. My son grew up in Poland and now he lives in the U.S. Sometimes I speak Polish with my son. I didn't learn it at Citibank, I learned it during my first job in Poland, because of the requirements. Between 1991 and 1993, I became completely fluent. I used to speak in Polish during press conferences. Working in a bank in an emerging market, building a business, you just don't have the time it takes to learn it well enough. So, here in Mongolia, I decided to devote most of my time and energy to business, not to learning a language.

-So, you've been away from America for 22 years. What do you miss most?
-Yes, it's been a long time. My parents are the angriest at me, because when I left, I told them I would be back in two years. That was simply not true. They aren't angry, but there's probably some regret for them. I go back to see them once a year, during Christmas time. I was basically raised in the heart of America, in the farmland that's the real America. I have a deep love for a part of American culture that I miss a lot, especially sports.

Now, in a new sort of technology age, I can watch all the sports I want to. But there were times, early in the 1990s and 2000s, when I didn't have access to information, I couldn't watch games. It was challenging there,  but I was fascinated by a life outside of the U.S., experiencing different cultures, different people, different ideas. I can consider myself lucky, but I'm still Middle American, born and raised.         

-You joined Khan Bank in August 2015, as director in charge of business. What was your reason for working in Mongolia?
-I came here in May 2014, to visit Khan Bank and to see if this would be a country where I could work, to see if I could help to add value to Khan Bank. I felt very much at home here in five days, I didn't feel like a foreigner. I also liked the opportunities for the platform that the bank had, because it had a good position in the market. It had a lot of customers, over 2 million customers. We had a very wide, sort of strong branch network. We had the board and shareholders interested in developing the bank, to continue to invest in and support change in the bank. I think there was an immediate fit, and I was interested in working on a bigger platform. I guess my first love here was not Mongolia, it was Khan Bank. I thought, wow, this is a really great opportunity for me to come and add value, to help sort of shape the future of the bank.          

As for Mongolia itself, I didn't make this decision as a personal decision, it was a professional decision.

-What are the three most important projects that have been implemented since you were appointed as CEO of Khan Bank? 
-Nothing is finished, we're still very much a work in progress. We're focusing on being more customer-centric, being an organization that values the customer first. We are, at the core of our business, we're a customer service organization. Our service has a lot to do with financial intermediation and financial services. I think that area is one in which we're putting in a lot of intense focus. 

Process improvement is another area, and automating services. Khan Bank has always been a new, centralized organization, and what we're trying to do is get everybody on the same page, everybody operating under the same standard. In order to do that, you need to centralize and standardize some of the processes across the bank. Ultimately, it leads to better and more consistent service. We also want customers to experience the same great services via branch channels, telephone channels, the smart app channel, or our mobile banking channel. We want the customer's experience to be uniquely, positively, and greatly standardized. If you go to a branch in Chingeltei District, you get wonderful service. But if you go to a branch across at the East Crossroad, for example, not great. We have to deliver consistent, high level services.   

Has it been implemented? Not yet. We're still on that road, it's a journey. Maybe there's never an end, you can always get better. As soon as you think you're done, that's exactly when you're done, because you aren't going to improve anymore. We want to continuously, always get better at what we're doing.

I don't compare Khan Bank to other organizations in Mongolia. I compare ourselves to my experience on Amazon, for example. I want us to be able to deliver that same type of world class service that you can receive from great service organizations like Amazon, or Apple. Even Amazon is always looking at what they're doing and how to improve. The philosophy is continuous improvement. That can be implemented. We're on that road, but we aren't there yet.

-How many provinces and soums in Mongolia have you visited?
-I`ve been to 14 provinces. I haven't traveled as much as I would like to travel in the last 12 months, but as soon as the weather gets better, on the other side of winter, I'll be doing more traveling. I really like to travel professionally, and personally, I would like to see Khuvsgul Lake. I've been to many beautiful places here, where we have nice businesses.       

-Mongolia's population is 3.1 million, and 2.4 million people are Khan Bank’s customers. How do you manage Khan Bank’s busy branches?
-First of all, it's gotten better. I think we've made some improvements. We aren't there yet. As I said, we  still have more work to do. Part of that is investing in other channels. A lot of analysis was made when I first got here. Basically, 98-99 percent of what we do in our branches can be done throughout our channels,  whether it's the Call Center channel, smart application, or internet banking. We've invested a lot of money into digital channels. That'll be our main focus. We know that customers don't always want to come to a physical location to make a transaction.

If we can provide those same services on a smart phone, or on the internet, we would love to give them back some of their time, because any physical branch, whether it's a bank or a shoe store, it costs us our time, traffic, parking. So, what we're doing is trying to focus our attention on digital channels, to allow our customers to do what they like to do and to spend less time in a bank queue. 

Next year, we'll launch a new omni-channel that will consolidate the experience of technology perspectives across all of our channels and allow us to build functionality, and to be faster than we are today. I'm very excited about that project. I think we've made a lot of progress in the last few years on moving transactions to different channels: ATM, POS, smart phones, and mobile banking channels. Overall, in UB, only four percent of our transactions are made by tellers, 96 percent of them are done on other channels. The management team has done a wonderful job of executing that strategy, to give customers more convenient options. We'll continue to do that.

-There are many micro-lenders emerging. Mobicom Corporation received the first special license from the central bank for electronic currency services. Other companies are waiting for licenses. What are Khan Bank’s policies on financial technology?
-Those companies are very good. We try to use them as motivation inside the bank to be better. Competition,  for me, is great. As you can see, all my life I've enjoyed competition. It makes us all better. The competition challenges us, motivates us to be better than we were yesterday. Every day, I spend most of my day trying to focus on the customer, and trying to give our customers - all 2.2 million of them - a better service experience. I believe these emerging companies, and any other fintechs, help. Whether we cooperate with them, or if we're competing with them, it helps the customer experience. It helps give energy to our initiatives, to improve ourselves.             

-Does Khan Bank fully provide security for the privacy of every customer’s account?
-I think we have 1.8 million active cards, and we have thousands of people that access the bank through channels every day. I think we, as an organization, as part of the online banking community, we have a lot to educate customers about on how to use it. Even today, at some restaurants I go to, if I want to pay with a card, they'll immediately ask me for my PIN. PIN means personal identification number, so it shouldn't be shared. I experience this maybe once a week. Somebody asks me for my PIN so they can process my card transaction. I think information security, password security, personal protection, is quite new, not only in the financial sector, but everywhere. We have a responsibility, as the banking community, to be more intense about the dangers of sharing your password. We have to understand the risks we take as an individual. At Khan Bank, we put a lot emphasis on information security and ISO standards like PCIDSS, but I can't keep customers from giving their passwords to their friends, or making sure they have strong passwords. Some people even put their passwords on their phones, or directly on the card. This is not only in Mongolia. This is my fifth emerging market, they all have the same developmental path. 

Ok, so I have so many passwords I have to remember. In order for me to remember them, I'll write them down somewhere, which is a big no-no. I think that's part of it. Who you share with, who you are contacting on Facebook, there's a lot of fraud that happens online. Our customers must be made aware of that. My advice is to keep your personal passwords to yourself, as much as possible. We've had some issues in the past with how strong passwords were on internet accounts. What did the bank require? We asked people to strengthen their passwords. But on the other hand, customers didn't like it. Why? Because customers think that fraud will never happen to them. But our password protocol is very strong and requires you to remember more, and to change usernames, passwords, and login names more often. We're not allowing passwords that happen to be very easy, in order to protect people from someone guessing your password. It's really easy. I'm not a professional password hacker, but there are people who are really good at it, and they understand how people set up their passwords, better than you do.

Last spring, we started a conference on digital security, along with the Bank of Mongolia and the Mongolian Bankers Association, to promote the educational aspect of information security. Moreover, we've been implementing various educational initiatives, ranging from providing tips through our pages to workshops, etc.                            

-The bill on investment banking has been discussed for almost two years now, with no sign of discussion in a parliamentary session. The bill, initiated by MP B.Javkhlan, faced condemnation from MP Z.Narantuya, who highlights its potential impact on supporting foreign banks. Do you think it's right to limit foreign banks in Mongolia to only operating in investment banking? Is it time to establish international banking in Mongolia?
-My job is to prepare Khan Bank to be able to compete with any bank in the world. We want world class financial services. If we're world class, we should be prepared for any competition in Mongolia, or outside of Mongolia. That's why I'm here, because I bring my many experiences with me to help. I don't worry about that too much. My job is to make sure Khan Bank is prepared for it. My position is not to lobby for or against bringing international banks into the Mongolian market. I'd like to make Khan Bank better than Citibank. I didn’t come here to be number three, I want to be number one. My scale is not as a local company, my point of reference is Citibank, Standard Charter, or HSBC.  I want to be better than they are in the business of commercial banking.

I've worked for international banks that have come to markets like Mongolia. I can tell you, it's not so easy. Somehow, people think it is, and that if an international bank came here, suddenly, it would be wonderful for everybody. Maybe there's some expectation around it.

-What are Khan Bank's key advantages?
-Our branch network, technology and customer base, and the appetite of our executive management and Board of Directors to transform and have an innovative digital bank.  

-What social welfare does Khan Bank provide to its employees?
-We do care a lot about our employees’ social care by organizing various programs and activities to have a positive impact on their performance and motivate them. We have a lot of new people here actually, they have to be incorporated into the Khan Bank family. We also have social funds for medical screening, language training, or postgraduate studies for our employees. Moreover, there are over ten clubs of various interests, contributing to better engagement and a more balanced life for our over 5,000 employees. The bank's management supports all of these things, and we try to be the employer of choice.    

-The previous CEO from Japan chaired Khan Bank for five years. Why do you think Khan Bank has appointed a foreign CEO?
-I think the main reason why they brought me in was just to help with best practices from other commercial banks. As I said, basically, to help to at least start the journey toward becoming a world class bank. Also, my job is to help to build the bench strength of the management teams, so that in the future, the executive team will be much more prepared to drive the bank's strategy as a world class financial service organization. In fact, I'm not the only one managing this large bank’s day-to-day activities. Perhaps I bring in an international perspective and standards, or a long-term vision to the management conversation, based on my expertise. Most of our bank’s management team are experienced and professional Mongolians.  

-Bank of Mongolia made a decision to put a term limit of 30 months on consumer loans, which is going to start on January 1st of next year. Will this decision affect Khan Bank’s operations?
-We are primarily a retail bank. Some of our retail loans are longer than 30 months. We have to make an adjustment there. We don't see this as a big deterrence. It's not too uncommon in other emerging markets to have some regulations around the consumer loan lending business. We'll find a way to adapt to it and continue our business. There will be some effects for Khan Bank.      

-Khan Bank was one of the first banks to introduce credit cards to the market. However, the financial education of the public is not very mature. How financially responsible are credit card holders?     
-This is an area I have a lot of experience in, launching credit cards in emerging markets. In Poland, we were the first bank to launch it. I understand the steps that we have to take, as a bank, to make sure that we're giving a financially responsible product to our customers. Communicate with them well about how to use those products. Our sales team has a tool called Sales Presenter, which we can share with you afterwards, which is basically a booklet that's very nicely produced. It takes the customer step by step through how it works, because it's in our interest, and the customer's interest, to use these products responsibly. We are not in the business of giving customers products irresponsibly, because it comes back to bite us. If they don't understand the product, if we give them too much credit, it comes back as a loss for the bank. I've seen a lot of these cases outside of Mongolia. We relaunched our credit card in November 2016. Since then, we've been very happy with the performance portfolio. We've done a good job of educating customers.      

-Khan Bank is the biggest employer in Mongolia, with a total of nearly 5,000 employees. It's obviously difficult to manage and lead this many people. What is your management style? 
-My management style is very different in different situations. Sometimes, I can be tough and serious. Other times, I can be funny. It's like life. How do you manage life? Because I spend most of my life here, 10-12 hours a day, most of it is talking, walking through problems. I like to be part of it and be engaged with all of the problems in the bank, as much as I can be.     

I do a lot of communication; I like to talk through problems. I like to have a dialogue with people. I like to give normal feedback. Once I'm comfortable with a certain executive or manager, it isn't so much micro-management, just normal follow ups. If you look at my work week, I like a lot of structure and discipline, but my meetings can be very open. I think I'm a very open and direct person. Nobody likes a difficult conversation. I don't enjoy it, but if I have to, I'll have it. Ultimately, my goal is to make Khan Bank a better organization. Sometimes, I have to be light hearted.  Sometimes, I have to be very serious and tough. I think a good manager should be able to do all of that. I like to encourage people to be open with me. Maybe it's a Western style, I don't know. I’ve never lived in fear of any manager I worked for, I was obviously respectful. I was never bashful or didn't say what I felt.

-The National Campaign Against Cancer has become part of the brand image of Khan Bank. We are incredibly grateful that a representative of the banking sector is consistently committed to improving the health of Mongolians. What are Khan Bank’s next steps for social well-being?
-In general, Khan Bank is such an important organization in Mongolia, not only from a financial services and financial intermediation perspective. Also, many of our branches across the country are very much a part of the social fabric in villages and soums. That's been a legacy for us from the very beginning. Playing that role in this country, we have a responsibility to improve the environment that we live in. Khan Bank has a unique platform. We're in almost every incorporated village in this country.

We have 530 plus locations, we have 5,000 employees, so through the power of that platform, we've done some really good things up until now. We want to use it more effectively to help the communities that we live in. Not only making people aware of living a healthy lifestyle, or how to prevent different diseases, but also, how to understand the products and services that they get from Khan Bank, or from other banks. Financial education, I think, is an important area where we can have a positive influence on helping people to understand how loans fit into their lives, how to save money. Just the simple things, household budgeting, etc. With this focus, this year, we've initiated a number of interesting programs to provide financial education to children and adults. The most recent example would be the "Future" program we recently launched, which is dedicated to providing high school students with financial education and literacy.  

We aren't better than our community, we're part of it. If we have an opportunity to improve that environment, that community is our best means to make sure that we all grow together, not just Khan Bank. Our destinies are tied together.

We have many initiatives, health and education initiatives. We'll continue those and go forward. Khan Bank has always believed in that, there's always more that we can do. We understand our responsibility and our influence. We must use that properly and positively.                    

-We see from your Facebook page that you're a person who manages to make time for yourself, hiking, taking care of your pets. Where can I find you outside of your working hours?
-I like the challenges of hiking, and I love the challenges of doing it fast. I live near beautiful Bogd Mountain, that always helps. I've found life here outside of Khan Bank. I like to play golf. There's one of the world class golf courses I've played on, 10 kilometers from this building. I enjoy golf season here, and I enjoy bike riding on the steppe with groups of people. I took the management team out once, maybe a dozen times.

Also, I like cold weather. I'm from Chicago. I don't want to disappoint you, but the winter weather in the Midwest is more violent and more extreme than Mongolia. Even the temperatures in Chicago can be very cold. Last December 25th, it was colder in Chicago than it was in UB. It was freezing and windy, so nobody went outside. You guys say it's cold, the numbers on the phone are really impressive, but there's no wind here. So, if you love the outdoors, Mongolia is a great country to live in.

-Thank you for your time. 

Photos by D.Javkhlantugs, O.Sukhbat, E.Batzaviya 

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