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VISA’s Victory: How Hock Took VISA to the Top

Article Overview: When Hock arrived on the scene, the credit industry was collapsing right before his eyes. As banks raced to respond to the increasing demand, they found themselves out of their depths. Masses of people were being given pre-approved cards, including even children, pets and convicted felons – any lists of people that the banks could find. Fraud was rampant. Hock knew something had to change or the entire industry would soon give out.

VISA’s Victory: How Hock Took VISA to the Top

When Hock arrived on the scene, the credit industry was collapsing right before his eyes. As banks raced to respond to the increasing demand, they found themselves out of their depths. Masses of people were being given pre-approved cards, including even children, pets and convicted felons – any lists of people that the banks could find. Fraud was rampant. Hock knew something had to change or the entire industry would soon give out.

But Hock was not your typical manager for the time. An avid reader, Hock was developing a new set of clearly defined principles by which he wanted to operate. He believed that companies that were hierarchical and put too much emphasis on control and following rules only served to stifle creativity and initiative, two key ingredients in any company’s success.

In 1968, Hock convinced the Bank of America to give up ownership and control of their BankAmericard program. He became CEO of a new company, National BankAmerica, which would be a non-stock membership cooperation owned in equal parts by all of its member banks. Among the banks would exist a common clearinghouse system, one that would reconcile all the accounts and ensure merchants would get paid for each purchase. But, instead of trying to restrict the partners, Hock took the unusual step of encouraging competition, saying, “Members are free to create, price, market, and service their own products under the VISA name.”

In 1976, National BankAmerica became VISA, and its success astonished even its backers. However, at the peak of it all, Hock decided to retire. For ten years, Hock lived in isolation, working on a 200-acre parcel of land in Northern California. How does he explain his decision?

“Through the years, I have greatly feared and sought to keep at bay the four beasts that inevitably devour their keeper – Ego, Envy, Avarice, and Ambition. In 1984, I severed all connections with business for a life of isolation and anonymity, convinced I was making a great bargain by trading money for time, position for liberty, and ego for contentment – that the beasts were securely caged.”

During that time, Hock also founded the Chaordic Commons of Terra Civitas, a non-profit group devoted to conducting organizational experiments. It was active in everything from religion to breast feeding to geo data mapping.

“I had spent about 16 years in various management positions in the consumer finance industry, but my first love was literature and philosophy, not business,” recalls Hock. “I was struck by how dysfunctional most business organizations really were, how they crushed the human spirit and how often people were in severe conflict with the organizations of which they were part... The new challenge was to determine the organizational principles of a societal organization that would emulate the principles that nature seemed to use.”

For the rest of his career, Hock would come to symbolize a new breed of organizational ideas and concepts that were, what he called, “management-proof.” He never returned to VISA, but his legacy remains to this day.

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Article Tags: banks, cards, credit industry, felons, fraud, hock, pets, victory, visa



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Re: Anyone advertising on Facebook? - I posted the info on here some time ago with the link to sign up. It was a promotion through the VISA Business Section of Facebook. They have a VISA area and they were giving $100 in promotional credit to everyone who joined, but I didn't see the offer the last time I was in that part of the site. Shri
Re: My Favourite 7 Boldest Entrepreneur Moves of All Time - Hi Evan, I have a new suggestion for "Boldest Entrepreneur Moves of All Time" and a suggestion for your Learning from the Masters series: 1. Boldest Entrepreneur Moves of All Time = Christopher Columbus: "... he saw the possibility of treasure and commerce where others saw only danger. He committed so wholeheartedly to that vision that not even dozens of rejections and ongoing penury could dissuade him from pursuing a journey to Asia via the West. He built on his technical strengths as a seaman to plan a viable journey and eventually marshal an expedition." - Christopher Hoenig, 6 Essential Secrets for Thinking on a New Level I bought Hoenig's book about 10 years ago but couldn't make head or tail of it then... reading it now and finding it inspirational... 2. Nomination for Learning from the Masters video: Dee Hock, founder of VISA. (Source = Hoenig.)
Re: My Favourite 7 Boldest Entrepreneur Moves of All Time - Thanks David - both are great suggestions! We've done Elon Musk from PayPal but none of the traditional credit card companies - I like the VISA idea a lot! Right now we're working through the entrepreneurs who were part of our Entrepreneur Heroes trading cards and as soon as that's done I'll add this to the list!
Re: My Favourite 7 Boldest Entrepreneur Moves of All Time - [quote="Evan":3rjwci0x]Thanks David - both are great suggestions! We've done Elon Musk from PayPal but none of the traditional credit card companies - I like the VISA idea a lot! Right now we're working through the entrepreneurs who were part of our Entrepreneur Heroes trading cards and as soon as that's done I'll add this to the list![/quote:3rjwci0x] Hi Evan, Oh good! Glad you like the suggestions. I think the book will furnish me with several more as I go through it!
Re: Good role models (and a rant on women in today's TV) - [quote="BuzzAroundBooks":zr494s8r]In that case, which shows on tv (if any) do you enjoy watching? And if you had the money are there any good role models on tv you'd ask to endorse your products and services?[/quote:zr494s8r] Heh heh. To tell the truth, I don't watch a lot of "new" TV. I watch a lot of sports, and see the advertisements for the dramas, sitcoms, reality shows, and so on, that way, and so I can tell what they're about, and what kind of people the women portray, without actually having to watch them! What I'd like to see are TV shows that show women pilots, bicyclists, and so on. (I'd really like to increase the profile of bicyclists on city streets, because in the good ol' USA, even though drivers are supposed to share the road with cyclists, 9 out of 10 of em think cyclists are supposed to be on sidewalks. Have some big name actors like Will Smith, Brad Pitt, Johnny Depp, riding through the streets on bikes urging people to do likewise...might do some good!) I'd like to see astronauts such as Shannon Lucid and Eileen Collins in programs, or the various female Air Force pilots (I just interviewed Donna Kohout, for example, first woman to fly a Nighthawk, for my Winged Victory webzine), etc. etc. The shows I watch are the DVDs of the ones I grew up with as a kid, The Avengers with John Steed and Emma Peel (Emma Peel was and is a role model for me), Banacek, Columbo, etc.! I used to watch Law and Order, too...but it's many spinoffs have never appealed....


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