Heba Darghli Brandon Taylor Luis Thompson

1. Heba Darghli Brandon Taylor Luis Thompson

2. Founded in 1852 • Famous for their Stagecoach! • Secure online payments in 1995 • Merged with Wachovia in 2009, creating the fourth largest bank in US History That’s the stagecoach!

3. WF Prides itself on diversity, community service, and exceptional customer service. • “We want to satisfy all our customers’ financial needs and help them succeed financially” Vision

4. Checking • Savings • Credit/Debit/ATM cards • Renters insurance • Retirement accounts • Teen accounts • Child/baby savings • ID theft • Much more Cross-selling products

5. Waste Problem

6. Informal Survey of Tellers • 22 individuals • Subject: estimated # poor solutions • Estimated number of dissatisfied customers • Findings • Estimated that 11% of solutions were of a poor nature. • 12 customer acct. closings Waste Quantified

7. Net charge-offs were $2.6 billion in quarter , 2011 (for loans and accounts) • 3rd quarter NI= 4.05 BB could have been higher • Charge-off expense is tucked into the 47BB Administrative and Operating Expense • Doesn’t appear like much in perspective to the other costs Financial Data

8. Process customer transactions • New services • Focus on sales and exceptional customer service • All employees must meet or exceed quotas, or face termination Retail Branches Tip: Avoid trips to the bank on the 1st and 3rd of each month.

9. Tellers: 280 “solutions”, or 93.3 accounts • Bankers: 2 accounts and 15 other “solutions” daily (total 1,680+ “solutions”). • Branch managers will face consequences if branch profit levels, or sales drop too much. • Daily check-ins/scolding from district manager • District manager scolded by market president • Market president scolded by regional president • Etcetera Quota System (quarterly) Unreasonable quota systems cause stress and depression

10. Lying • Manipulation • Abusing the elderly/mentally ill • Abusing language barriers • Opening accounts without customer knowing • Re-opening new accounts and closing others for various, made-up reasons Ethical Issues Leading to Waste

11. Numbers increase Unethical practices Quotas Inflated, unprofitable accounts Crushed Morale Wasted money Increased hiring costs Dissatisfied employees Fishbone Diagram

12. Sale quotas should be attainable • Adjust quotas with foot traffic • Look at profitability of “phony accounts” • Reduced turnover leads to less employee need • Operating lean by having experienced employees Going Lean

13. Tenent 1—Value lies within the service provided • Tenent 2—Gemba (opportunity) alter or remove quota system • Tenent 3—Muda(waste) lower# quality solutions= higher revenue/lower charge-offs Going Lean

14. Tenent 4—quota system=Push, Increase value to cust. = respond to mkt pull • Tenent 5—Perfection (Svc. not Mfg.) 5 S’s • Seiri—sort correct level for quota system • Seiton—ensure employees not over pressured • Seiso—ensure tellers are experienced and well trained • Seiketsu—implement standardized training • Shitsuke—keep employees happy and well trained to sustain level of service. Going Lean

15. Adjusted quotas based on traffic Reduce sale quotas Quality account policy Result: improved profits and reduced employee churn Account quality control via banker connection Mandatory funding of accounts New Process Flowchart

16. Happier employees, especially in non-converted Wachovia locations • Reduced turnover/training costs • Less waste • Higher profits • Better public image of banking industry Benefits of Change

17. Waste at Wells Fargo is abundant • Hindering Profits • Need to implement lean process improvement • Federal Lawsuit alleges “Daily Solution Reward System” promotes unethical and illegal activity. • Brandon Taylor no longer with WFB and has never been happier Conclusion / Updates

18. Person bowing ¿Any Questions?