Wells Fargo: If Only They Had Listened To Their Employees

Originally published on LinkedIn September 28, 2016

Wells Fargo’s management actions and inactions over the last several years have led to the organization now experiencing a real life worst case enterprise risk management scenario that hits all notes — reputation risk, strategic risk, compliance risk, legal risk, market risk…it goes on.

Unlike a cyber-attack or someone tampering with ATMs or a worldwide financial crisis, they did this to themselves. And their employees warned them.

Wells Fargo is now facing lawsuits from former employees who say they were fired or demoted after refusing to open fake accounts in order to meet sales quotas. Current and former employees tell heartbreaking stories about stress, ethical angst, and difficult life decisions. One former branch manager says she was instructed as far back as 2007 to “do whatever you need to do” and to make employees open unauthorized accounts. (http://money.cnn.com/2016/09/26/investing/wells-fargo-fake-accounts-before-2011/index.html). She is not alone in telling such a story. Wells Fargo has fired around 5,300 employees found to be opening fake accounts and those employees felt they had to do so to keep their jobs. This wasn’t a performance issue; this is a culture issue.

I’ve previously recommended a visit to Wells Fargo’s website to read their pamphlet on vision and values, https://www.wellsfargo.com/about/corporate/vision-and-values/index.  The words “trust” and “relationships” appear frequently. Unfortunately the people in management who could have changed the sales quota system did not live those values. Tension results when what you actually do doesn’t match what you say you value and that tension will weaken any organization.

If management had bothered to trust and value their employees, the signs were there. Employees were reporting that the customers didn’t need the recommended products and internal auditors were raising concerns about sales practices. Long term employees were quitting to find better jobs or being fired for not meeting sales quotas. A change in employee retention is a great signal that something is going on. It could be good or bad and deserves attention. Weren’t exit interviews conducted when employees who couldn’t or wouldn’t meet the sales quotas left Wells Fargo? If senior management had listened and responded accordingly they would not be in this situation today.

This is a great reminder to listen to what your employees are telling you. You probably spend a lot of effort and money to hire, train, and retain good people. Trust them and listen to what they tell you about their jobs, how they feel about their jobs, and any concerns and suggestions they voice. If they are telling you by the action of leaving the job find out why. The beauty of listening to your employees is that all it takes is a measure of humility and a bit of your time. If they are engaged, productive and motivated, keep doing what you are doing. And keep listening.