Magazine article American Banker

National City CEO Gets on Customer Service Soapbox

Magazine article American Banker

National City CEO Gets on Customer Service Soapbox

Article excerpt

About 18 months ago, David Daberko, the chairman and chief executive officer of National City Corp., took stock of the branch network his company had amassed in 15 years of acquisitions and concluded that it was "slowly atrophying."

Service was poor, employees felt powerless, and customers were unhappy, Mr. Daberko said Tuesday in a keynote speech at Thomson Financial's Seventh Annual Best Practices in Retail Financial Services conference here.

Then, he said, the Cleveland company anted up, putting 3,000 new and more established branch employees through extra training at its "National City Institute." It also gave branch employees 10% to 20% raises to reduce turnover and attract higher-quality people.

Bottom-line improvements linked to the changes have turned Mr. Daberko into a service evangelist, he said. "In a hundred years, our bankers could wear aluminum suits and sell bonds for an asteroid mining firm, but their success will still come down to customer service," he said. "Without a positive interaction between seller and customer, nothing else matters."

He said that in a survey for 2001, 50% of his customers called themselves "very satisfied," compared with 42% in 1999.

And the percentage of dissatisfied customers fell to 4% in the fourth quarter of last year, from 8% in the last three months of 1999, he said. Over the same two years account closures dropped 40%, to 78,000 in the fourth quarter of 2001, Mr. Daberko said.

Since 1999 turnover has dropped 20% among full-time branch employees and 25% among part-timers, he said. "That means we're able to more consistently serve our customers and we're spending less time and money hiring and training replacements," he said. "Potential tellers are now more likely to choose us instead of targeting a Nordstrom's or the like as a place to work."

Mr. Daberko said service is so vital -- and so hard to do well -- that improving it is "the greatest challenge facing all financial institutions. …

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