The big banks have come in for more than their fair share of criticism over the past eight years. While some of it is undoubtedly merited, some isn’t and there is much to learn from some of their “best practices.”
One of my favorite spring pastimes is to read the CEO’s letter in various bank annual reports. While JP Morgan CEO Jamie Dimon’s letter might better be described as a “lengthy epistle,” there is nevertheless much to be learned from its contents.
On page 46 (yes, really) of Mr. Dimon’s shareholder letter this year, he opines that it is our industry’s responsibility to actively work to regain the public’s trust that was shaken by the financial crisis of 2008-10.
He provides a checklist of necessary actions that any bank – large or small – must adhere to in order to have the trust of its customers and communities it serves. Nine best practices are listed in the checklist and I’ll cover the first four in this month’s blog along with their applicability to MidWestOne.
1. Maintain steadfast, consistent and transparent behavior wherever they operate.
We are nothing if not steadfast and consistent. Our 81-plus year mission statement of “taking care of our customers and those who should be” is simple and is prominently posted in each office throughout our geographic footprint. We know our customers deserve our best effort in each encounter.
Transparency is a little tougher to measure and track. We often refer to our third operating principle, which is to “always act with the utmost integrity.” Integrity and transparency go hand in hand. Our business can sometimes be complicated and explaining a business practice isn’t always simple. But that doesn’t mean we should strive for anything other than complete transparency.
2. Communicate honestly, clearly and consistently.
See above! With that said, the degree of regulation in our industry makes “clear communication” nearly impossible. If you have recently gone through the home mortgage process, you will know of what I speak! Despite the government regulators’ attempts to make things simple for borrowers, they seem to only make it more complex. With that said, we should always strive to answer all of our borrowers’ questions clearly and honestly at each step of the transaction. And that goes for any other business in which we participate.
3. Deliver great products and services.
Our industry continues to evolve. More and more banking is done via mobile devices and this trend is accelerating. There is a perception among certain customer segments that the large banks offer better technology than community banks. Not true! Successful and progressive community banks can compete with terrific technology and products. The key is to do your homework before deciding on a bank provider. While doing your research also consider what your service level will be when (not if) you encounter difficulty. Read on …
4. Make it easy for customers to deal with you – particularly when they have problems.
Part of my elevator speech for MidWestOne has always been “you will have a problem at some point in our relationship. And, when you do, that’s when we will set ourselves apart with exceptional service.”
Everyone knows the frustration of getting stuck on hold for 20 minutes. Or not having a call returned. Or sending an e-mail that is ignored. I will go out on a limb and say it doesn’t happen often here! At MidWestOne, we speak often of “service recovery.” In other words, we admit a service shortfall and fix the problem in a manner that exceeds expectations. When we do that, we strengthen the relationship with our customer. Having said all of that, there will be times when we simply have a difference of opinion and we’ll admit that as well. Effectively solving customers’ problems is a big deal for any community bank!
Thank you, Jamie Dimon. Your list is right on target and it is applicable to all financial institutions, large or small. Our goal should always be to take care of our customers and do it consistently in every encounter. If our industry follows these mile posts, increasing levels of trust will come in time!