Wizard's secret is finding right talent

By MARK STORY

Most of the staff employed by home loan maverick Wizard are middle or senior managers, but corporate animals need not apply.

Finding people who are more interested in building careers than stuffy hierarchies with all the bells and whistles, says Sydney-based founder and executive chairman Mark Bouris, is critical to a culture that has seen Wizard beat banks at their own game.

In just six years, Wizard has become Australia's No 1 non-bank lender and the world's largest issuer of residential-backed mortgage bonds. It is also ploughing into the market here.

But finding the right talent can be tough, says Bouris, with so many people within this conservative industry prepared to settle for a nine-to-five existence.

"We're looking for people with strong people management skills. Our managers need a strong desire to perform, which means retaining customers and growing branch volumes. Corporate animals wouldn't get on with me - they don't exercise intellect."

When the frank and down-to-earth Bouris finds the right people, he works hard to retain them through partnership arrangements.

Based on a quasi-franchise system, any of the company's 1000-plus business "writers" in Australasia have the opportunity of securing exclusive rights to a particular area - the only cost is setting up the office.

As well as sharing the income stream from every mortgage, business writers also share in the equity of the business - without risking personal capital.

Efforts to transpose the Wizard culture and business formula locally is working well. In just 2 1/2 years, Wizard, which operates 15 branches in New Zealand and plans to add 10 more this year, is on track to become the No 1 non-bank lender.

The company is writing about $40 million in loans a month here.

A cursory glance at Wizard's distinguishing hallmarks, says Bouris, shows why the company is growing faster than banks. Modelled on the US experience, Wizard matches home loans to borrowings.

In other words, its ability to find money and on-loan to borrowers dollar for dollar means that, unlike banks, Wizard is a risk-free business.

Wizard's business proposition is not new, but the need for a lot of capital in the establishment phase means it is not well used locally.

This is where new shareholders have added real value, says Bouris.

Despite having weighty shareholders, including Aussie media mogul Kerry Packer's Publishing and Broadcasting, Deutsche Asset Management, Ticketek owner ecorp and more recently, ABN Amro, Wizard has successfully avoided excessive corporate trappings.

Bouris says that unlike banks, Wizard's shareholders do not exert excessive pressure - other than to expand the business.

What also sets Wizard apart from banks, he adds, is the ability to place independent advice before revenue.

"I want to look after a customer for life. To stay No 1 lender in customers' lives means believing more in personal service than in processes and numbers.

"This why we're establishing a branch network while many banks are rolling theirs back. We're complementing low-cost community branches with highly competitive pricing." Bouris started in finance after graduating from university with an MA in international tax. A married father of four, he worked as a chartered accountant and property developer before forging the partnership in 1996 that led to Wizard.

Bouris sees his executive chairman role as blending growth with the need for profit, and keeping the team together. With the entry of such heavy-hitting shareholders back in 1999, he saw the need to impose a report and delegation-oriented management structure.

One of prerequisites of institutional investor ABN Amro's 25 per cent stake in the business in 2001 was first-class reporting.

As a result, Bouris started poaching bank managers willing to embrace the Wizard culture. Like the Australian operation, Wizard New Zealand operates a flat business model with no line reporting.

"Our CEO, both here and in Australia, would see every one of the branches at least three times a year. Unlike the banking sector, our CEO will go through the business plan of each branch manager," says Bouris.

To find out what Wizard needs to do to continue outperforming banks, the company recently commissioned independent researchers to run and report on customer and branch focus groups.

As part of Wizard's open-book reporting philosophy, all principals at its 150-plus branches are also canvassed independently on what they think about staff, the business, products offered and management.

In addition to paying staff well, Wizard also provides staff with the more qualitative life-balance working conditions. But Bouris sees little point in formalising the company's more "touchy-feely" persona.

Nevertheless, strong staff retention levels suggest his management-by-exception philosophy is working.

A million miles from the hype and veneer of mainstream banking, Bouris attributes much of the company's success to its roots as the underdog that dared to challenge the traditional banking models.

"To preserve our culture, we're ideally looking for people who, while well trained and disciplined, are a little unruly. Just like any good boxer, it's important to have a bit of the hungry-mongrel mentality.

"This is a low-margin business, so an insatiable desire to win is equally valuable."

Far from being an impediment, Bouris believes a lack of formal management training has helped the company maintain its little Aussie battler mentality - even though it's now big business.

"It was more important for me to understand the cultures of the guys trying to sell home-loan products. We're now applying that model in New Zealand."

John Grant, head of Wizard New Zealand, shares these sentiments. "I'm constantly on the road getting out to our branches. It can be lonely in the field, running a small business in a highly competitive industry.

"So getting to work with them face to face each day really pays off. Our December figures were a record for the company."