How Jeff Markham & Richard Holt forged a merger that made history Featured

8:01pm EDT April 30, 2011
How Jeff Markham & Richard Holt forged a merger that made history

Anxiety. It’s an unpleasant word that makes people squirm, but in 2008, when Bank of America and Merrill Lynch announced their merger, in all honesty, that was the word on the minds of Jeff Markham and Richard Holt.

“I think there was anxiousness just because of what was going on in the financial markets the weekend this was announced,” says Markham, regional managing director of Merrill Lynch’s Texas region.

From an employee perspective, whenever there’s a big merger like this, anxiety creeps in as to the future of their jobs, but Holt, Dallas market president for Bank of America, and Markham were quick to recognize the realities of the situation. On Markham’s side, he had 500 financial advisers, and Holt had 10 client managers, so in reality, the two sides could actually work together and not worry about losing their jobs.

“There was some anxiety because of the market conditions, but because of the respect both companies had for each other, we complemented each other so well,” Holt says. “We didn’t have this big overlap of services that typically requires some reduction in force. We didn’t have any of that, so most of our teammates responded very enthusiastically. Put yourself in a commercial banker’s shoes — if you had 500 financial advisers out there that could make a referral for you, life couldn’t get easier.”

It was on this foundation that the two leaders began moving both sides forward when the merger occurred on Jan. 1, 2009.

Merge teams

To make the merger a success, Markham and Holt had to combine their teams into one cohesive unit, and they started with themselves, which was key.

“We tried to get to know each other quickly,” Markham says. “So many of the things that other people are hung up on — do I pick up the phone for this, do I not pick up the phone? — after we had developed a relationship, it became easy to pick up the phone and get an answer quickly.”

They spent a lot of time around each other and had many conversations about themselves but also about their respective businesses.

“The relationship part at our level was important because that translates down into how our associates feel about each other,” Holt says.

Once the two of them were on the same page and felt comfortable working together, then they started looking at the numbers. Just the fact that Markham had about 500 financial advisers handling $28.6 billion in assets under management and Holt had 10 client managers meant they would have to go through a coordinating process to get them working together.

“We identified very early on that there was expertise on each side,” Holt says.

There were different products and a little bit of a different focus, but they focused on how to leverage the expertise and the relationships that Markham’s advisers had in the business community. They started tracking the referrals from Markham’s business to Holt’s. In 2010, they realized that for every 100 referrals his team made to Holt’s team, about 15 generated revenue.

“We used the process of referrals from Jeff to my world and built out and figured out what worked and what didn’t work, and once we got it right, we flip-flopped,” Holt says.

To help people trust each other and feel comfortable leaning on each other for business, Markham and Holt hosted a number of lunch get-togethers and cocktail hours as well as having educational seminars. They also created teams, so now each one of Holt’s client managers has a team of someone from Markham’s side as well as someone from U.S. Trust and someone from the private bank investment group.

They say the key to building a cohesive team when you merge is communication.

“Communicate early and often,” Markham says. “You can almost overcommunicate. Make sure you’re sharing the vision — that it’s not just that there is a vision, there is a strategy behind this. When you’ve got uncertainty like that, people do want to be a part of something larger than themselves, and we’re all created that way, so they’re going to tie into that vision and strategy. Some of them will happen further down the line. Some of them will jump in there quickly. You overcommunicate and begin to share capabilities and really point out the most important thing to both cultures and that is we’re a client-first organization.”

When Markham and Holt communicated with their people, they made sure it was clear and candid.

“I try to compare it to something the group has been through before, if it’s possible,” Markham says. “It’s not always possible, but if you can compare it, to make it relative, I do find that to be helpful in many ways.”

And they made sure that they kept saying the same things so people would really get it.

“My rule of thumb is that you have to tell people 11 times before it sinks in, so we go back and check with people,” Holt says. “Once I can hear my client managers kind of rolling it out with their broader team, then I know it’s starting to sink in.”

Build a strategy

For the merger to be successful, there had to be a strategy to move both organizations forward, so while Markham and Holt worked to create a unified organization, they also worked on building a strategy.

“Part of it is defined for you,” Markham says. “You can see the natural synergies when Jan. 1 came around. Then the other part of it is sitting down and taking a broad look at what the market has, knowing that you’re client-first, you’re going to be serving clients, so you have to back into, ‘What are our clients and what are our future clients telling us, and then you share that.”

What they found was that as the world had gotten more complex on the financial services business, they needed to be able to help clients meet their needs by listening to them and helping them create goal-based planning to take out some of the complications. They needed to provide more tools and a broader platform to service clients — both things the merger could help them do.

They looked at each company’s footprint and found that each organization held about 25 percent market share in their respective industries. Despite that, on Holt’s side, less than 10 percent of his CEOs and owners had a relationship with Merrill Lynch, and the number was similar for Markham’s clients having a relationship with Bank of America.

“That’s pretty easy to identify an opportunity, and so then you develop strategies and tactics around that,” Holt says.

So they got together and did a gap analysis to create those strategies to go forward.

“Where is there a gap where we have a client need or a client opportunity, and then trying to fill those gaps with those teams where we have someone from the commercial banks and U.S. Trust, private banking investment and the wealth management organization,” Markham says. “Many times we have relationships and are able to go out there and say, ‘Where could we provide value for this client?’”

Staying rooted in reality is one of the most important things you can do in creating your strategy, according to Markham and Holt.

“One thing I learned early on is to get the right facts,” Holt says. “Get the right facts so everything you’re doing is based on good facts and not intuition. Start there and come up with a good strategy and get the buy-in from the various teams, attack the market, and then stay with it. Too often, companies come up with the right strategy, but they give up on it after six months because they’re not seeing the results. Something like this is going to take years. You just have to stay after it.”

Track your progress

With strategy in place to move forward, the last step to merging the organization was to track their progress to make sure the strategy was actually getting implemented and people were actually working together.

“It’s not rocket science, but it’s hard work,” Holt says. “You have to get teams on both sides coordinated, sit down and go through the [planning] process and obviously include the client in on the discussion. It takes some time every day, and that’s why we track all of this, because we want to be moving the needle every day.”

Markham and Holt say it’s important to identify key indicators of success for your combined organization.

“You only track the performance of things you want to do well in, right?” Markham says. “You track it and celebrate it.”

He and Holt initially tracked how many referrals were made from one business to another. The initial numbers are just a starting point, so if he says he wants everyone to get one referral in the first half of the year, he can use how people perform to that to change goals.

“Everyone may get one done in January,” Markham says. “Well, then you know I’ve set the goals way too low — we can get 18 done a year. I’m just using those numbers — heck, it could be 1,800 is the right number, but you have to somehow get started, and then it will tell you what the market will bear. Then you can usually stretch that if there’s the time to put the focus on it.”

It’s important that after you set those initial indicators that you adjust your expectations quickly based on initial performance instead of just going with guessed numbers.

“Start with the facts, because a lot of times people just come up with these grandiose goals, and it’s like, ‘Where’d you get that number?’” Holt says. “One of the things we did was we went in there and said, ‘What is the number? Where are we? What’s a realistic number?’ and set a plan around there. What I’m giving you is the basics, but that’s what a lot of this is — we’re building a business around the basics.”

The numbers you track won’t lie. If you start to see the numbers flat-lining, it may indicate that you’re pushing your team too hard and it’s time to pull back a little on your goals.

“There were times when we could have pushed everybody to go a little bit faster, but the fact is, everyone shows up with a full day ahead of them,” Holt says. “You have to stage this, because one thing you cannot do is you can’t exhaust your team. There’s a lot going on, so you have to make this part of the routine, part of the culture. That takes time. You can’t just change a routine or culture in a week.”

But the numbers can also help you see if you have a problem with just one or a few individuals if everyone else is meeting his or her expectations and one person or team is not.

“Sit down and lay it out say, ‘Here’s what I’m seeing,’” Holt says. “Get their feedback on what’s working, what’s not, and if you’ve got a gap, you agree this is a gap, and you go about coming up with a process to close it. You’ve just got to do this on a constant basis.”

As employees get wins, that will also help bring around the people that aren’t meeting their goals or have poor attitudes, because they’ll be motivated by other people’s successes.

“You’re going to have some that are slower to adopt, but you know that going in, and you continue to coach, communicate, and they see you celebrating someone’s successful acquisition of a new opportunity, so they’re only hurting themselves,” Markham says. “Then you just repeat and repeat until done.”

It’s been more than two years since the merger, and Markham and Holt are both pleased with the results that their organizations have achieved.

“I won’t say anything has become routine, because every 15 minutes something new is happening, but this is starting to become more routine,” Holt says.

The teams are now working together so well that often Holt and Markham don’t even know about meetings that are occurring.

Markham says, “The bridges between all the businesses within the organization are getting built every day and getting stronger every day.”

How to reach: Bank of America,; Merrill Lynch,

The Markham file

Born: Fort Worth, Texas

Education: Bachelor’s of business administration degree in marketing, Baylor University

What’s the best advice you’ve received?

Life’s about relationships — that’s from my grandfather.

As a kid, what did you want to be when you grew up?

I wanted to be a quarterback.

What was your first job ever as a kid?

My first job ever as a kid, I believe, was at a landscaping business. I was 15. I did drive a forklift, though, all the way through college in the summers.

What’s your favorite board game and why?

I guess Sorry because it brings back too many memories, and I played it as a kid and I play it every now and then. Sorry can be so exhilarating and so absolutely disappointing all within five minutes.

The Holt file

Born: Midland, Texas

Education: Bachelor’s in business administration, Abilene Christian University; MBA, University of Texas San Antonio

What’s the best advice you’ve received?

My best is from my father, and it was work hard every day.

As a kid, what did you want to be when you grew up?

I wanted to be a professional baseball player. It’s where the girls were.

What was your first job?

I started out on the family farm. We didn’t believe in child labor laws back then so we started at about [age] 10, hoeing cotton and moving irrigation pipe. That’s why I got into banking because it was indoors and air-conditioned.

What’s your favorite board game and why?

Chess or Trivial Pursuit — that’s a better board game.