Impact banking: From apes to apps – disruptor Neal Cross’s journey

UN Sustainable Development Goals

If you’re going to interview a chief innovation officer, there may as well be something new and unusual about the location. So when Euromoney sits down with Neal Cross, credited with much of the drive behind DBS’s digital transformation, we do so not in the bank’s Singapore head office in the Marina Bay Financial Centre but in the Indonesian jungle.

There is just no point in meeting Cross anywhere ordinary, because he isn’t ordinary and this location is a perfect illustration of why not. In the open-fronted restaurant of the Hotel Orangutan in Bukit Lawang, an arduous four-hour drive from the Sumatran city of Medan, we talk against a backdrop of scooter throttles and the occasional German backpacker.

Before he joined DBS, Cross held a similar role at MasterCard Labs in Asia, tasked with driving innovation at the credit card company. As a theoretical exercise, he wanted to put together a universal problem-solving framework, and needed a case study to test it. Fascinated by endangered Sumatran orangutans, he decided to make their conservation his case study problem.

So he and his team set off for Bukit Lawang on the edge of the Gunung Leuser National Park, where the 6,000 surviving members of the species roam wild in the ever-shrinking forest that palm oil plantations have yet to encroach on. He got in touch with the imam of the village, Abdullah Togap, who also serves as a leading trekking guide.

“Part of the process was immersion,” Cross says, sipping on a Bintang beer. “We spent time talking to the tourists, local villagers, guides, making observations around orangutans, the forest, the palm oil; understanding all the stakeholders here.”

Noting that well-intentioned tourists do not bring in a lot of revenue or carry any lasting influence, they concluded that the single most effective solution they could come up with would be to build a boutique hotel targeted at wealthy executives and potential future leaders, people who have decision-making power in Asia – or will do – and therefore will shape corporate policy towards things like sustainable palm oil use and corporate social responsibility. Make them fall in love with orangutans, the team concluded, and tangible changes will start to happen.

It was just a training exercise, a way of testing a model. But two weeks later Abdullah phoned him asking when he was coming back to build the hotel. Cross, by now interviewing for the DBS role, explained that he was too far away to do it and too busy, and that building it had not actually been the idea.

Abdullah, crestfallen, asked: “So you’re not coming to help?”

The conversation gnawed at Cross for weeks until one day he realized: well, if not me, then who? So he called Abdullah back and said: “Let’s get started.”

Getting from that moment to us sitting in Hotel Orangutan having an interview took years. Cross lives here most weekends and has made the trip from Singapore about 150 times. The project started by buying a tiny building used as a tourist office, then buying the land leading up a steep hill behind it and finding people to help.

“I thought I would start by buying a cement mixer, a chainsaw, a pick axe – boy toys,” says Cross. (Never one to be put off by anything new, Cross and Abdullah did all the architecture themselves, from the structure of the buildings to the interior design of the rooms.) “But Abdullah said: ‘No, the first thing you have to buy is a rice cooker. These people work for you now, you’ve got to feed them.’ That stuck with me as a philosophy: everyone gets fed.”

Being a jungle hotelier has brought rather different challenges than those common in banking: challenges like getting 40 ceiling fans into suitcases to bring them over on flights from Singapore, or a belligerent monkey that threw the water tank off the roof.

Cross considers the venture a social enterprise because of its treatment of employees, its commitment to reduce rubbish in the village and the extension of free credit into the community, including lending a villager the money interest-free to buy a decent car and putting him in charge of airport transportation from distant Medan.

But it is not an eco-resort: he says solar would never work because the monkeys would trash the panels.

All of this has taught him a number of lessons he applies in business, much of it anchored in the simplicity of village life.

‘Simple but strong’, originally an observation about the basics of construction fundamentals in an earthquake zone, is an example. To Cross it has become a philosophy for working in an unnecessarily complex world.

The clarity of how partnership works in a small village ecosystem is another useful lesson – that screwing a partner for the last dollar just because you can is no way to build a sustainable business – and that you will thrive if your partners do.

A local expression is “same-same but different”, a recognition that the world only works in certain ways no matter how infinite the variety of human experience; another is “same shape, different colour”, which is useful in understanding that many apparently disparate problems may have the same fundamental root and therefore the same solution.

The experience in the jungle has not put him off hotels or social enterprise and a second venture is largely complete on an island off Aceh, the point at the tip of Sumatra that has been blighted both by war and by being the worst-hit place in the Boxing Day tsunami of 2004. That venture is dedicated to coral preservation.

It is hard to see where he finds the time to be a bank executive.

Cross’s route to DBS was circuitous and it is unlikely there is another CV like his in the bank or perhaps anywhere in banking. He left school at 16, as by then he already had an independent income, having started programming the ZX Spectrum home computer as a child and moving on to writing commercial software by his early teens. (Brits of a certain age might recall the games ‘Andy Capp’ and ‘GI Hero’, they were both Cross’s.)

It only occurred to him much later that, aged 15 in 1987, he had written a machine learning algorithm. He had no idea what those words meant at the time, but he was a martial arts aficionado and became frustrated that in fighting games all you had to do was make the same move over and over again in order to win. So he created a programme where the computer would learn which move players were relying on and make them less effective, so that, in order to win, people had to adapt their game as the computer adapted to them.

This sort of thing is quite common with Cross: realizing that some flavour-of-the-moment innovation is something he had actually already done, whether he meant to or not, sometimes decades earlier.

Later, when the internet began to gain traction in the 1990s, he created an online version of his uncle’s established aquarium business. Again, experimentation taught him things that would later be very useful.

He built a tool to create websites by analyzing what was coming up at the top of the Google algorithm for searches on, say, fish tanks, and got so freaked out when he realized he had spawned the top 100 fish tank hits on Google he shut the whole

thing down.

He claims not to regret missing out on further education.

“I would say I dodged a bullet,” he says. “I have this thing in life that I don’t want to be like someone else. I stopped wearing jeans at 12 because I saw everyone was wearing jeans. And I thought it was quite strange that everyone gets taught the same thing and told to think the same way.”

The fact that he was teaching his own IT teachers how to code also made him doubt the merit of further education – plus, having grown up poor in Weston-super-Mare, Somerset, the fact that he was already earning an income was highly attractive.

Instead he took his direction from what he was learning about kung fu and tai chi, and learned through experimentation, building what he thinks of as mental toolkits rather than classic academic knowledge.

“It would drive my mum nuts,” he says. “For a birthday present, if my mum could afford a cheap watch, she’d have to buy two, because she knew I’d take apart the first one and cry when I couldn’t put it back together.”

He travelled the world, taught bodyguards kung fu, DJ’d (“Everyone in England says they were a DJ”), and did not move to corporate life until he was 30, first for a subsidiary of commercial data firm Dunn & Bradstreet, then in a job at Microsoft in Australia he had applied for by mistake.

Microsoft put him in touch with financial services for the first time, as he was selling to banks. He got on to Commonwealth Bank’s innovation committee and the experience would prove useful later.

He started to rise through the ranks, winning an award from Steve Ballmer, former CEO of Microsoft, and developing a reputation as a punchy and interesting public speaker (albeit one usually wearing cargo shorts). From there he moved to MasterCard; then DBS’s departing chief innovation officer, Steve Monaghan, recommended him to the Singapore bank.

The idea appealed.

“I wanted a bigger box of Lego to play with,” as he puts it – but he was not sure how he would fit working in a bank culture. Working his way up the interview chain, he eventually met chief executive Piyush Gupta.

“I said to him: ‘What’s your innovation strategy?’ He said: ‘It’s really good. I’m going to hire you and you’re going to work it out.’”

Impressed at the candour and having reached the conclusion that many DBS executives – David Gledhill, Tan Su Shan, Paul Cobban, Lee Yan Hong – were surprisingly nice people, he took the job on.

“I’ve been around banks a long time and they’re not the greatest places in the world to work,” he says. “They are full of very highly paid alpha people. But I don’t see too much ego or politics in DBS.”

Although Gupta had long since decided that innovation was key to the bank’s long-term survival and success, which meant there was support right from the top, it was not a particularly easy start.

“People think I was thrown huge amounts of money as budget. God no,” says Cross. “I turned up on day one with three people sat around a table, without even a sign saying innovation group, in a sea of tables on the consumer bank floor.”

In an attempt to get traction, the team started running hackathons (so many that one of his team ended up writing a book about hackathons) and did everything possible to try to associate innovation with fun.

“I couldn’t work out why people would say they didn’t want to do innovation. What, you want to sit in your cubicle all day and type in numbers? The innovation team should be the coolest place to work in the company.” To counter the attitude they tried water-pistol fights, laser-tag fights, pillow fights. “For some reason junior staff love to hit an MD with a pillow.”

Still, few people wanted to work with him until an unexpected turning point: a lengthy profile of him and his techniques in The Straits Times, Singapore’s main newspaper. From this he learned that people separate their work and home lives, and that only when something registers in their home life too – reading the paper over breakfast with family, for example – does it gain a greater resonance.

What is wrong with the way bankers think?

Cross identifies three things that struck him immediately in banking. One is that banks are very hierarchical, especially so in Asia, which he believes leads people to be doing too much managing and not enough leading. A second is collaboration. Since banks tend to own most things in their world – branches, ATMs, IT – they are not naturals at working with other members of a broader ecosystem.

The third is risk appetite.

“I can’t work this out. On one hand we risk billions of dollars in lending to companies and people. Banking is about pricing and monetizing risk, and if there’s no risk, there’s no money. But if internally I try to do a project and I hear: we can’t do that, it’s too risky, I find it a really interesting juxtaposition.

“I got really fed up with the phrase: ‘The regulators won’t let us do that’ – 80% of the time that is false.” He says it is simply an assumption that something won’t fly, and that assumption curbs a spirit of experimentation. “But experimentation is the only way you can operate if there is a low level of clarity about the future, which is where we are now. It’s a fog. The future of finance has never been as opaque as it

is today.”

On top of this, there is an argument that Singaporeans are particularly risk intolerant; although that’s not the same as saying that they cannot innovate.

Cross has a theory that the greatest innovation occurs in places where there is a palpable threat: Israel, Taiwan and

South Korea.

“Countries where there is a high level of threat per capita have high innovation, too. Singapore is so well-run that everything works and life is safe, which means you don’t need to take risks.”

Cross is not into innovation for its own sake, however. He is amusingly dismissive of phone-based equivalents of credit cards.

“If your strategy is to take a credit card and put it on a phone without adding any more value, then you’ve just created a bad credit card. It’s heavier, takes more pocket space, runs out of battery and you have to log in. Well done.”

So in any innovation he evaluates the effort involved for the consumer, because if there is no return on value there is no point in doing it.

“Innovation, for me, is: find the right problem. Solving a problem in an elegant manner, which is successful.”

DBS today is considered a world leader in terms of digital transformation, but it would be wrong to give Cross all the credit for that, nor would he seek it.

Gupta himself is obviously a passionate leader on the subject and numerous business heads – most obviously head of technology and operations David Gledhill – have been vital. Ideas like benchmarking against tech companies instead of fellow banks and quantifying the return on equity from a digital versus a traditional client have come from the top.

But certainly an institution-wide shift in thinking has taken place. Cross sees the job as being like a startup within the bank, coming up with something and then distributing it through the institution and encouraging people to use it until it no longer feels like it belongs to the innovation team but takes on a life of its own.

Last year he says up to 16,000 people did something that could be classed as innovation, which is quite something when the total headcount is 25,000. A key understanding has been that telling someone how to do their job is never going to work; empowering them to drive change themselves is a far better idea.

A day earlier, Euromoney had trekked into the jungle with Cross and Abdullah, allowing Cross to indulge two key passions: seeing orangutans in the wild and antagonizing tourists.

“We’re just getting away from that tiger,” he says to a group coming the other way.“They won’t attack unless you’re wearing yellow,” he says loudly, in earshot of a woman wearing yellow.

Do you ever get bored of doing that, Euromoney asks?

“Never.”

We see several wild orangutans, one a usually reclusive male, and it is easy to see why Cross is so captivated by them: their faces show as much wisdom and compassion as the best of people, combined with great strength and agility. In this part of the world these apes are revered. Singapore even made one an official tourism ambassador (called Ah Meng, she got a certificate and some bananas).

So is his plan to attract the great and the good to see these animals working? Gupta has been here and so has group head of wealth management Tan Su Shan.

Cross speaks of their visits with enormous pride. Google and Microsoft senior staff have done so too, as have backers of venture capital funds.

It is of course wholly impossible to quantify if a visit here changes attitudes and policy in any meaningful way, and the threat is readily apparent when one drives through mile after mile of palm oil plantations, once jungle, in order to get to the hotel.

But it is worth a shot.

“Self-limitation is the biggest impediment,” Cross says. “I never met anyone successful who doesn’t have self-belief. If you don’t convince yourself you can do something, then the world will pull it down.”

He could be talking about bank innovation or orangutan preservation.

After all, it’s a jungle out there.

These are the areas that the United Nations says banks need to consider when accepting their responsibilities in shaping and financing a sustainable future.