In the 1990’s, the great American philosophy is if you cannot beat your competition then buy them has resulted in explosion with the mergers and acquisition arena (M&A). However so was the M&A failure rate because of a variety of reasons. According to authors Timothy Galpin and Mark Herndon in The Complete Guide to Mergers and Acquisitions in 70% of the mergers and acquisition the desired results are not achieved. The leading causes for this failure were people and cultural problems. M&As have slowed down, but they are still happening especially within the financial institutions. For example: Has your bank been recently acquired in a merger? With large regional to purchase a list national banks scooping up local profitable banks, many loyal customers are facing the people and cultural problems which lead to very, very bad customer service. And speaking of customer service. Another survey about customer service indicated that 68% customers who leave due so because of bad attitudes or indifference by the company or a specific employee. Attitudes are directly a people and cultural problem. My local bank was recently acquired and I just experienced the employee and attitude issue head on. And if you are a banker reading this, please take note. Mistake Number One – Blame Technology My last and final mortgage payment was due July 1 via an automatic deduction.
The bank did not make the deduction. I later learned that due to a difference between the monthly deductions and the final pay out I needed come in to make the final payment. Since I did not receive any correspondence, I believed that I had miscounted the final payment date. Almost three weeks after the due date, I received a past due statement including a late fee. Stop right here. How would you feel being a 20 year loyal customer with not one, not one late payment and you receive a notice from a machine that you are in default? And then response It is the fault of the computer program. Mistake Number Two – Do Not Allow Acquired Customers to Contact You No where on this statement and I repeat No where was there a name to contact, a telephone number, and a website. I called the local branch and spoke to a clerk who after checking her list determined that I was correct and she couldn’t give me an answer for this problem. Further discussion revealed that she had asked the new corporate office to include contact information because she had been receiving and continues to receive complaints about a lack of information. I then called a couple of branch managers and asked for the name of the CEO and a telephone number. Both branch managers had the name but could not provide a phone number. The inability convinced me that this new banking firm truly did not want me or any other loyal customers calling them. Mistake Number Three – Presume Customer Is Stupid Using the Internet, I located the phone number, called and asked to speak to the CEO. Of course, I was connected with his administrative assistant. After explaining the problem, I also shared that I spoke with two of the local branch managers and learned that they did not have phone number. To make a long story short, I, as an almost 20 year loyal customer, told her that I was completely flabbergasted by this incredible poor customer service. She assured me that everyone had this number and people were encouraged to call. Then she asked me if I spoke to the Retail Sales Manager within my area. Now, I must admit that this question really surprised and confused me. How could I contact that person since there was no name on this document? How could I call him or her as there was no phone number? How would I know that this was a retail issue? Mistake Number Four – Do Not Offer a Formal Written Letter of Apology She said she would take action to investigate this situation and get back to me. I said that would be great and I wanted a formal letter of apology so that I know that the CEO knew of this issue. Mistake Number Five – Lie to the Customer Later that afternoon, I received a call from the local regional manager for this bank who apologized to me and said there was no excuse for what happened. I accepted his apology. He told me that he was unaware of the lack of contact information. I found this surprising since one of his employees had been asking for over 3 months for this information to be included on any notices from the corporate center. Also in talking to one of the managers, I learned that there was a directive not to have customers contact the corporate location. Now, my brain is saying How dumb do you think I am? For I know that I am not the only one who complained. Probably what happened is the other complainers did not take their poor customer service to the top management tier. And the acquiring bank is wondering why their customers are jumping like rats from a sinking ship? With new financial institutions popping up on almost every corner much like restaurants, every bank, savings and loan or credit union should be doing everything in their power to create loyal customers. Unfortunately, the executive management of these institutions in many cases have failed to adopt Harry S. Truman’s philosophy that The buck stops here. Maybe it is time for them to review their own bad attitudes because they acquired that new bank for its profitability. Their current bad attitudes will quickly erode all profits and make their competition smile as their banks welcome these dissatisfied customers with open arms. Simply speaking, leaders are readers. If you enjoyed this article, sign up for Power Choices and join over 1,000 valued subscribers who receive this unique monthly newsletter designed to help your business life while improving your interpersonal skills.