Hi. I’m Roxanne Emmerich, Chair of the Institute for Extraordinary Banking and CEO of the Emmerich Group. In this episode, we’re talking about one of the biggest lies in banking strategy and how the game-changing banks are using second-order thinking to drive results their competitors can’t touch.

Let me start with the harsh truth. Most banks don’t have a strategy. They have a list. They call it a strategic plan, but it’s really a hodgepodge of projects and tasks cobbled together at the end of Q4 in a room full of people nodding and checking phones. If that hits too close to home, don’t worry. You’re not alone. But you are vulnerable.

Here’s what separates the top five percent from the rest. They build operating systems, not checklists. Let me give you an example. One of our clients, a five-hundred-million-dollar community bank, came to us with a sixty-four-item strategic plan.

They were proud of it—until we started asking questions. Which of these actually moves margin? Where are the lead measures? How do these lead measures tie into your key initiatives?

Which are the KPIs most important? How do those tie to your target markets? What is the BHAG, and how is everything tying into the BHAG? There was no connection between the parts.

It was a hodgepodge of a tossed salad on a sheet of paper. And when I asked them questions about how they were gonna make that work—crickets.

What they had was first-order thinking.

“If we do more, we’ll grow more.” That’s not how high performance works. As the book Intelligent Thinking explains, first-order thinkers solve the immediate problem without thinking through the long-term or hidden implications.

Second-order thinkers ask, “What happens next?” and “How does this tie into everything else?” That’s the difference between adding digital signage and engineering a culture that improves deposit acquisition by forty percent.

Within six months of switching to our Breakthrough Planning System, that same bank improved their efficiency ratio by twelve points, increased their premium pricing without attrition, and tied every initiative to one of five core performance drivers. They installed weekly rhythms to measure and adjust on the fly. And this isn’t theoretical. It’s happening right now at banks across the country. The game-changers in banking are the ones who figured out that strategy is a living system—not a document gathering dust on a shelf.

Are you done mistaking activity for alignment? Are you tired of first-order thinking in your strategic plan that has no hope of actually creating the results—because you’ve tried it so many times before and it never has? Book a call, and let’s walk you through the planning system used by banks that are tripling cross-sales, growing NIM, and winning Banky Awards. Because more projects is not a strategy.

It’s a symptom of a problem.