News

Who's who: Richard Speer

While his crystal ball failed him in the early '70s when he predicted that most banking transactions would be electronic within 10 years, Richard Speer has gone on to refine 'the vision thing.' His Speer & Associates consultancy helps financial institutions, EFT networks and other clients plot their strategies for the future.

March 24, 2002

Though consultant Richard Speer is considered a visionary by some in the financial services industry, his first published peek into the future is one he's still trying to live down.

The chief executive officer and co-founder of Speer & Associates, an Atlanta-based consultancy that helps financial institutions, EFT networks and other clients plan their strategies, doesn't see himself as a visionary.

Richard Speer

Rather, he believes his key skill is simply discovering what his clients need and making it happen.

Fact is, he learned the hard way not to bank on predictions. In the early 1970s, while at a bank in North Carolina, he conducted a study on the future of banking transactions and told a local newspaper reporter "by 1978, three-fourths of all bank transactions in North Carolina will be electronic."

Needless to say, he missed the mark slightly. "If I wait around long enough, I'll be right," he said. "I just missed it by about 40 years."

Office politics

Speer's powers of prediction also failed him in politics. After graduating from high school, he enrolled at Georgia Tech to study nuclear physics. Instead, he earned a degree in industrial management and chose to enter politics soon after his 1971 graduation. He passed up an opportunity to work on the campaign of up-and-coming gubernatorial candidate Jimmy Carter, instead signing on with Carter opponent Carl Sanders.

"I didn't think (Carter) could win, so I worked on the campaign for the guy who was supposed to win easily," Speer said. "And we got our butts kicked."

As it turns out, Carter's victory was a key factor in Speer's road to success.

"After we lost to Jimmy Carter, the only job I could get was in a bank," Speer deadpanned. So at 22, he became the "staff grunt" for First National Bank of Atlanta, working on transaction cost models and marketing campaigns.

"That was one of the best jobs I ever had," he said. "That's what got me started in the business."

In 1973, Speer moved to North Carolina and a job at First Union Bank, where he made his infamous prediction. He also worked on a project that turned out to be one of the early landmark electronic funds transfer studies. Two years later, he landed a position with a consulting arm of American Express. During his five years there, he took on another important project: helping create one of the first for-profit EFT networks in the nation.

MAC daddy

Back then - when "there were still buffalo roaming the prairies," Speer joked - Philadelphia's Girard Bank (later acquired by Mellon Bank) had a proprietary network called George that was, in Speer's words, "kicking ATM butt."

Philadelphia National Bank, a Girard competitor, came to American Express for a response to George. Handed the task, Speer and his associates acquired some existing software, integrated it and created a network that became MAC, which today remains one of the country's best-known EFT networks.

The success of MAC as a shared network - which was nearly unheard of at the time - landed Speer's group jobs building networks all over the world, from Canada to Puerto Rico to the Dominican Republic and across the U.S.

It was about this time that Speer met his friend Doug Anderson, who, ironically, is now CEO of the MAC Network. In 1977, he worked for Philadelphia National Bank.

The vision thing

"My first impression of Rich was 'Here's a guy that really knows a lot,'" Anderson said.  "Even back then he was energetic and very knowledgeable of this field we're in and extremely capable of expressing his views. The strategic assessment of our EFT business led to a network that became arguably the most successful of its kind in the country."

But did he strike Anderson as a visionary? "Very much so. He's able to draw on the knowledge he has and think ahead. My first indication (of Speer's vision) was the picture he painted in 1977 proved to be just what happened over the next four or five years."

On the ground floor

When American Express decided to buy another consulting firm in 1980, Speer and colleague George Albright wasted no time in spinning off their own company. That was the birth of S&A, and it began, literally, in Speer's basement.

"It was kind of touch and go for a while," said Albright, co-founder and chairman of S&A. "We came out of American Express with a lot of structure and corporate overhead, and all the (expenses) that go along with it. We didn't have any precedent, but we had some clients that helped us."

Albright said often Speer will assess a client's needs, devise an answer and then hand it off to him to complete. They've worked that way for the last 22 years.

"He's much broader than I am," Albright said. "Rich's uniqueness is he's able to be conversant with financial people, lawyers, investment bankers, marketing people - he's a very quick read. He's also a risk taker, which not everyone is in the banking business."

And about Speer's vision? "It was his idea to start this company," Albright said. "I just came along."

Today Speer & Associates has clients around the world. About 50 percent of the company's business is in the U.S., Speer said, while 40 percent is in Canada and the other 10 percent in Latin America.

While he still travels extensively to provide hands-on consulting services (conducting this interview with ATMMarketplace via phone from Brazil), the bulk of his current responsibilities relate to management.

"They are all gigantically organizationally dysfunctional," he said, describing his staff of 50 or so employees, most of them seasoned veterans of the financial services business. "You don't tell these people what to do. These are all independent self-starters."

Speer expects he will pare back his travel schedule and hours when his 18-month-old son gets a little older. He and his family now split their time between Atlanta and Hilton Head. While he still travels three to four days a week on business, he enjoys sailing and playing tennis whenever he can.

What's ahead

Speer said a key to his company's success was its early conviction that consumers would welcome a card that could be used both to debit funds from their bank accounts at ATMs and to make purchases at retail stores in lieu of a credit card.

"The magic we discovered was that the debit card was distinctly different," he said. "Both Visa and MasterCard missed the boat."

Today Speer & Associates focuses about 25 percent of its time on research and development to keep ahead of the competition. It also assists financial institutions, EFT networks and other clients with mergers, card operations and other aspects of their businesses. "At any point in time we have about a dozen projects going," Speer said.

Asked what Speer & Associates' most important current project is, he deadpanned, "World peace."

Asked about the future of the ATM industry, he turns serious. "In terms of the U.S. payment system, I think you're going to see a move from transactional business over the next five years, where we will start to leverage financial information, which is the byproduct of these transactions.

"The issue is, 'Can I determine what you need with that card to help you manage your money better?' It will be a business where banks are no longer a protected industry. That competitive reality is very sobering for most banks; some will succeed, but some will be acquired."

Of course, he would never make a hard, fast prediction. Right?