After 5,000 employees are fired for illegal account creation to comply with aggressive cross-selling targets, Senator Elizabeth Warren grills CEO John Stumpf and asks him to resign.
Naturally, he refuses to step down, return one nickle or even acknowledge that he did anything wrong — morally or legally.
Stumpf tries to explain that cross selling engages customers before he’s shut down by Senator Warren.
Cross selling is indeed a great tool to increase customer lifetime value if the customer values the product. Does it increase engagement? Doubtful. Does it increase customer experience? Perhaps — if touch points along the way were frictionless and created positive emotions.
In this case though, there was no consideration for the customer’s needs. There was no consideration for anything — ethics, law, relationships — except for profit and benefit to the shareholders (including $200 million that Stumpf earned as his share values increased).
The process wasn’t frictionless either. I take that back — for the customers who had accounts opened without their knowledge, there was no friction at all. However, for customers were bullied into opening accounts they didn’t really need — the experience was certainly not frictionless.
Employees were being pushed to meet numbers which were unrealistic “8 is Great” — 8 accounts was the target. Who needs 8 accounts with a bank? Chequing, savings, mortgage, credit card — 4 seems about average to me.
Accountability and leadership appear to be the biggest challenges and Stumpf didn’t even bat an eye when he was grilled. He tried to talk his way out of each question but he refuses to be accountable. Employees who didn’t make sales numbers were fired. Employees who opened up those 2 million fake accounts were fired. Some managers were fired but the Executives continue to be employed while they collect insanely high compensation packets.
I would be crazy to think Wall Street will ever become Enlightened Capitalists and embrace Enlightened Capitalism. Greed is simply too prevalent; compensation too high and pressure to produce results at any cost too ingrained.
For the rest of us though, we can become more Enlightened Capitalists and together we will make a difference in our world.