Though technology helps banks and credit unions compete for customers, the latest digital tools will only get you so far, says Tim Welsh, vice chair for consumer and business banking at U.S. Bank.
“You don’t become central to somebody’s life, you don’t power their potential, unless you also have a human connection,” says Welsh.
His comment echoes a phrase from U.S. Bank’s purpose statement: “We invest our hearts and minds to power human potential.”
The statement, which is meant to sum up the overall goal of the bank and guide how it conduct business, is the kind of phrase that could live solely in an annual report or on whiteboards, Welsh acknowledges. However, employees at the $682.4 billion-asset bank aim to bring the words to life on a daily basis, in part by discussing them as often as possible.
“I joke with my wife that if I haven’t said ‘I’m investing my heart and mind’ five times a day, it must be a weekend,” says Welsh, who has spoken about the role of culture in banking at conferences like the Consumer Bankers Association Live event.
While it is hard to draw a direct link between such repetition and the bank’s bottom line, Welsh is confident there is a strong correlation. As he sees it, the purpose underscores what a difference the people at the Minneapolis-based bank make in delivering value to its customers.
“The vast majority of consumers want to make everything in their life simple,” Welsh says. “But when they have a big decision, they want to talk to somebody. And that’s where we think the human is the competitive advantage.”
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Fewer, More Meaningful Interactions
That blend of human and digital may be an increasingly important advantage, experts say. The proliferation of digital tools means consumers have fewer interactions with a financial institution’s staff, but the interactions they do have become more meaningful. And if those interactions leave customers disgruntled technology makes it easier than ever for them to switch financial providers.
“What’s going to differentiate you from Chase? From Wells Fargo? From the credit union down the street? It comes down to the people,” says Dave Martin, founder of the retail banking consultancy bankmechanics.com.
It’s a message that resonates with both customers and employees, Martin says. Customers need to hear that an institution’s staff will be there when they need help. But staff members — especially those who may be wondering about their relevance in an age of artificial intelligence — also benefit from hearing that they can be the difference-maker for an institution and for a customer.
“The point is the banker is going to be more relevant than ever,” Martin says.
Indeed, J.D. Power’s 2023 study of retail banking satisfaction indicates that 87% of people expect to use branches either at the same level or more often in the next year. Even among people age 40 and under, 21% expect to visit branches more often.
A Chance to Make a Human Connection:
Share of bank customers age 40 and under who expect to visit a branch more often within the coming year, according to a J.D. Power study:1 in 5
While some are coming in for routine transactions, customers also are seeking to solve a problem, get advice, and open new accounts, according to Jennifer White, senior director of banking and payments intelligence at J.D. Power.
At the same time, banks are facing challenges due to branch turnover and staffing, with consumers telling J.D. Power that they are waiting longer for service, White says.
What U.S. Bank Does to Reinforce the Culture
U.S. Bank is no slouch on the technology side. It was ranked No. 1 overall for mobile banking for the first quarter of 2023 in Keynova’s semiannual scorecard, for example.
But unlike an app that can be programmed, updated and let loose, it takes persistent effort to instill a customer-centric culture among staff. The effort starts with near-constant reminders. “People have to hear the message,” Welsh says.
The message is reinforced when leaders visit branches and ask staff members how they are making a difference for customers. Leaders then share the stories they hear on weekly phone calls. A market leader in Oregon, for example, helped a Spanish-language customer render the bank’s mobile app in Spanish, allowing her to use it herself instead of relying on her child for translation, Welsh says. “That’s powering human potential,” he says.
U.S. Bank supplements the anecdotes with metrics. When assessing employee performance, managers measure things like appointments, phone calls and sessions on cobrowse, a tool that lets customers share their phone or computer screen with a banker when they need help navigating the digital interface.
The bank does not set numerical goals but looks holistically at how employees are doing in areas such as being a good team member, Welsh says. “We’re also pretty clear that we’re not trying to tie these to any particular sale. What we want is the story of someone who cashed a check and felt better. We don’t need ‘and then I sold him a new credit card.'”
To foster more conversations — and perhaps new stories — U.S. Bank recently added a feature to its app called “Life Moments.” Customers can type in goals such as buying a house, taking a vacation or saving for a child’s college education. If customers give permission, staff members can see the goals and reach out to discuss ways to achieve them.
“We’re trying to continue to evolve and innovate in this digital-plus-human format,” Welsh says.
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An Edge in Retaining Deposits and Employees
U.S. Bank does keep an eye on broader numbers such as deposits, number of customers and products per customer.
Like many other banks, it saw some deposit run-off in the first quarter of 2023, according to its earnings report for that period. It attributed the decline in what it described as “legacy company deposits” to general industry disruption. Large regional banks were particularly hard hit when many consumers nationwide, rattled by the failure of Silicon Valley Bank and Signature Bank in March, had moved their deposits.
Nonetheless, thanks to the acquisition of MUFG Union Bank, U.S. Bank’s average total deposits for the first quarter rose to $510.3 billion, from $481.8 billion the previous quarter, an increase of 5.9%. Average total deposits slipped to $497.3 million in the second quarter of 2023 before bouncing back to $512.3 million for the third quarter.
It’s hard to say with certainty that U.S. Bank’s culture is driving those kinds of specific results, Welsh acknowledges. Even so, he believes there is a correlation.
He also believes the emphasis on culture and purpose plays a role in the bank’s attraction as a place to work at a time when companies across the board have struggled to fill open jobs. “We feel very good about the fact that it’s helping us to keep people here,” he says.
For Welsh, the measure of success comes when he visits a branch and finds a new employee eager to tell him a story about how she recently helped customers — as happened on a trip to Arizona this fall. “I’m like, ‘Yes, this is exactly what we’re trying to do,'” he says.
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