Jeff Judy

Jeff's Thoughts - November 2, 2016

Wells 3: Are You Listening?

The Wells Fargo saga continues to play out in the media. Does that matter to your institution?

Some financial services providers are assuming that the Wells story will have little impact on them. They say things like, "That's a big bank problem, and we don't behave like them. Our customers won't tar us with that brush!"

How do you know? To the average consumer, a "bank" is someplace to keep your money, get a credit card and debit card, and maybe get other loans from time to time. Your customers don't separate big banks, community banks, and even credit unions. They "bank" with an organization that provides financial services, and the differences may provoke some spirited debate within the industry, but your customers really don't care very much about these fine distinctions.

Other financial institutions are taking the offensive, deliberately raising the issue of trust. For some, that's an attempt to defuse the situation. For others, it is an attempt to take advantage of a rival's problems. But how will this more pro-active approach sit with your customers?

After all, you may find that you do not need to explicitly address the Wells news with your own customers. It could be the case that too "loud" a campaign to draw a distinction between your practices and those at Wells Fargo just highlights the potential problem, that it raises doubts instead of being reassuring.

In this election year, we hear a lot about "negative campaign ads," and everybody is sick of them. If you dwell on banking improprieties just to make the point that you are above all that, you might come off as more annoying than informative.

So how do you decide whether, and how, to bring up this topic with your customers and prospects? How do you decide whether your customers see you as part of a banking system that takes advantage of their customers, or as largely separated from an isolated problem for one other company?

You listen!

The truth is that you probably have both kinds of customers, those who see the news as confirmation of their suspicions, and those who don't see that same news as applying to them. The only way to sort them out is to listen to them.

Are your front line staff paying extra attention to the signals they are getting through interactions with customers and prospects? Are they a little extra sensitive to indications that trust issues may be running beneath the surface of these relationships?

Managers, are you listening to what your front line staff have to report, are you taking their observations seriously? Instead of assuming that a pro-active effort to assure customers of your trustworthiness is the best strategy, take the temperature of your customers first.

Right now, it is especially important to listen to the chatter at the front lines. Respond to customers who have concerns, but resist the temptation to raise concerns among customers who aren't worried.

And in the meantime, listen to your audit and review staff, "listen" to your exceptions reports. Use your systems to make sure you really are following desired practices all the way down the line. Remember that without the size of a Wells behind you, a few major incidents or a couple of bad apples can do serious damage.

After all, the most alarming part of the Wells story is their failure to see, to hear, what was going on. The behavior was so unusual, and on such a wide scale, that the information that there were major problems was all there. But nobody wanted to see it. Nobody was listening to customers, to employees, or to systems.

Policy, process, procedures, systems are all good things. But they don't replace attentive listening, at all levels, coupled with a thoughtful measured response to what you hear.