When a weak economy brought myriad challenges to the banking world, SunTrust Banks CEO Bill Rogers focused on driving employee engagement.
William H. Rogers Jr.
President and CEO
SunTrust Banks Inc.
Bill Rogers became CEO of one of the United States largest banks in June 2011, years into an era when top banks, battered by a weak economy and facing a lean future, had been aggressively cutting costs—including training. Rogers—and the man he succeeded as SunTrust Banks CEO, Executive Chairman Jim Wells—had chosen another approach: redirecting leadership development and retooling the banks workforce to drive engagement with a totally new kind of client—one that might be more likely to seek a banking relationship than simply take part in a transaction.
We spoke with Rogers at his office in downtown Atlanta, Georgia.
Q| What are your views on the role of talent in sustaining the health of the financial sector and driving growth at SunTrust?
A| Sustaining the health of an institution begins and ends with talent and that's nowhere more true than in financial services. One major difference between financial services compared to other industries is that for us, every interaction with a client could result in a financial loss. Every interaction has risk attached to it; in some cases it's significant. That's why training our talent is critical to ensuring our success.
Q| The recession is now three years old and banks are finding their way into a new normal. We haven't profiled a financial services CEO before and were curious to know if in the past three years you have had any epiphanies or confirmations of the role of talent in the financial sector.
A| The banking business has never been tougher and it's never been more important to the health and recovery of the U.S. economy. As you would expect, as the CEO of a bank I'm a fundamental believer that we need to play a part in leading the recovery.
As you also might expect, we are not winning every popularity contest. What I tell our teammates is Put on your SunTrust pin and get out there because what we do is really important. Making a small business loan, sending someone to college for the first time, putting someone into their own home—that's noble and important work and we should do it with pride.
We're operating in a tight environment where the margin for error is small, so our people need to know the right things to do to stay ahead. There are banks that haven't made it. We've not only made it; we are thriving and growing and we'll be one of the big players going forward, and that takes a different talent set. We've really got to be at our best.
Q| Given such a big shift in performance needs and expectations, how has that influenced training goals?
A| We've put more intensity and seriousness into the accountability part of our training. As for our skill base, we've spent more and leaned more into leadership development than in the past. I think we're seeing the benefits of that. Our leaders are gaining a whole new perspective on what they can do to impact change.
Q| What compelled you to do that?
A| It was the realization that it was going to take a new type of leader and new thinking to be successful in financial services in the future. We've made some fundamental changes to our business model and we needed to make sure our leaders could adapt.
Q| To drive shareholder goals, a financial organization has to balance the risk-reward equation. How do you achieve that?
A| Successful bankers have two qualities that are useful in balancing risk and reward. They are very skeptical but also extremely optimistic. If you weren't an optimist, you would never make a loan. So we train on both of those qualities and also on relationship-building techniques, with an emphasis on listening to the client.
Our number one value is listen first. Another important value that helps us balance risk and reward is integrity. We have to hire people who have a high integrity quotient.
Q| Where does innovation fit in? Thinking outside the box has gotten some financial institutions into trouble. How do you balance innovation with the need to manage risk?
A| We do that primarily through our leadership training. We take our top 200 leaders through our advanced leadership program and another 1,000-plus through our leadership development program. We use management cases and dialogue to guide innovation, particularly process innovation. There's also a lot of dialogue around balancing risk with the desire to expand the client relationship. We want to do the right thing for the client and the bank.
Q| Some innovation must be required to deal with younger clients whose expectations are driven by mobile technology. How do you adapt to customers who only want to bank with a smartphone?
A| The interactions of Millennials with a financial institution are completely different from those of their parents and so is their notion of loyalty. We spend a lot of time studying and understanding consumer behavior. We talk to 1,000 clients a night through a variety of survey mechanisms.
I've been in this business 32 years and I've never seen consumer behavior change so quickly. For that reason, client behavior plays a key role in discussions about service quality and product innovation.
Q| Some predictions say that Millennials will make up about 50 percent of the workforce by 2014. How do you think that will affect training and employee engagement?
A| Millennials are known for their constant desire to learn and take part in training opportunities. Some won't work for a company that doesn't invest in their training.
We look at measures of teammate engagement, and we apply a lot of science and a lot of energy to improving those numbers. The core components of engagement are I have the tools that I need to succeed and I know what's expected of me at work. Well, both of those are right in the sweet spot of training.
Q| How do you know the learning is working?
A| For us it's the empirical measurement. I tie it into engagement. If I'm seeing rising engagement scores related to the foundational elements that I mentioned, it helps determine if learning is really taking hold and making a difference.
Q| When you're looking at budgets and thinking about investing in learning at SunTrust, what are some of the business criteria you consider?
A| Because we've measured the impact of engagement, we know that highly engaged teammates contribute more—often much more—than less engaged teammates in terms of client loyalty, client profitability, and enhanced shareholder returns. It's obvious that training is a key driver of engagement, and we're developing the math to support that belief.
Our investment in training has continued through arguably the worst time in banking since the Great Depression. We've increased our training budget every year over the past several years. And that wasn't necessarily related to an increase in numbers of teammates. We are just fundamental believers that, ultimately, training builds sustainability not only for our workforce but for our clients. It's highly correlated.
Q| That's in contrast to many companies where the reaction is to cut training first in tough times.
A| Well, I'm a banker so that might've been my first tendency. When you look at the line items in a budget, training sticks out. But having the math that shows that training drives results makes the investment decision a lot easier. Of course, as with any budget item, it's a negotiation process.
Q| That negotiation would typically be done by a chief learning officer. What do you look for in a chief learning officer? What do you expect your CLO, Mary Slaughter, to deliver?
A| For me the first requirement is they have to really know the business. That's important because then they understand how to partner with the business units to help them succeed. If a CLO starts talking about the training modules she wants to put in place, that's not a good sign. Mary seeks to understand our business needs, the business diagnostics, the workforce's needs, how those needs are changing, the needed client first behavior, and how to supplement and enhance those things.
I also expect Mary to be an avid learner and to do some learning outside the company. I want her to assume that someone out there is doing some things better than we are and that we should find them and figure out how to apply those concepts here. I want to see her involved in professional associations to capture more about the learning field and where it's heading. Think of the irony of having a chief learning officer who had no interest in learning. CLOs should have a hyper commitment to their own learning.
Q| When you think about the teammates, what keeps you up at night?
A| Of the things that keep me up at night, it's not our teammates. I'm proud of the teammates I represent. I'm humbled by what they're trying to do. I worry about a lot of economic and environmental things, but not about our teammates. I'm not concerned about fixing individuals, but I am concerned about how I can help someone succeed by making sure I'm doing everything I need to do to make that happen.
I know what every team's engagement scores are, but I'm careful not to say to someone, You know, you need to be more engaged. Instead I might ask, What can I do, what do we do together, to improve your engagement?
I have a little trick that I use when I talk to our advanced leadership classes. I start by covering the challenges and opportunities in the financial services industry and the tough times were facing. Then I ask them, What is the number one thing we have to change at SunTrust to be successful? I say, Let's take a few minutes and write down our answers. I'll do the same thing. I'll give you my thoughts then you give me yours. Those pens are smoking! But I write just two letters on my piece of paper: ME.
Q| What characteristics do you look for when you're hiring and promoting leaders?
A| I'm looking for leaders who want to grow as individuals and who understand that a commitment to personal growth is what makes the difference. I'm a brand-new CEO—since June 1and I need to be in a learning mode along with everyone else in the company. So willingness to learn is one of the first things I look for.
We have three guiding principles: Client first, operate as one team, and focus on profitable growth. So I look for people who have a passion around serving clients, and for people who are willing to hold themselves accountable first and then others. And they must be willing and able to understand what it means to operate on the team. Another thing I look for in a leader is someone who really likes what he does and has a passion for the business.
Q| Where do you put your time in developing teammates?
A| I spend a lot of time in the field. For example, we recently rolled out some new products and delivered a lot of training to support their introduction. I was getting reports that things were going extremely well, but I decided to find out for myself. So I walked into one of our branches to talk to the branch manager and one of our financial services representatives. They confirmed that we were on the right track and when I kept asking questions, they finally said, Bill, stop. We're going to role-play this for you. The branch manager took the role of a client with a tough issue and the financial services representative modeled the way she would handle the situation.
I could see a high level of comfort as they practiced what they had learned. I also knew that if this was happening in 1,700 other branches, the training was really getting through.
We really emphasize practice because we are professionals and professionals practice. We refer to our clients as clients rather than customers. Clients are served by professionals who diagnose their needs. There's a lot of practice and preparation that goes along with that. And our teammates get that. It's not just about going through training.
Q| There's a litmus test for CEOs. A lot of them say, People are our most important asset, but don't support practices that are consistent with that statement. But you clearly believe that there's a connection between the development of people and the achievement of strategic goals. What accounts for that?
A| In fairness, it's a learned skill and it's taken a while. I've seen a lot of behavior on both sides of the equation, but the thing that really put me squarely on the zealot side is the science behind it, being able to link training, development, engagement, and performance. Maybe it's because at core I'm a banker. I like numbers.
Q| You recently supported a major increase in tuition reimbursement, and the bank provided more than 1 million hours of teammate development in 2010actions that some might find surprising during a recession.
A| We just increased tuition reimbursement to the maximum level. That wasn't an easy discussion in an environment where budgets are tough. But I had personal reasons for supporting the increase. I started working at this bank with the thought that I would get some experience and then go to graduate school. I started applying to schools, but I realized that I loved my job and it seemed crazy to leave. Also, I didn't have any money and I was in love and I wanted to start a family. The bank offered me an opportunity to pursue my career here, go to school with the help of tuition reimbursement, and attain my personal goals. I want to give people that same opportunity to expand and grow without having to leave here.
Q| Twenty years from now what changes would you like to have made that affect either the financial services industry or SunTrust?
A| What I hope for SunTrust is that the investments were making now that focus on putting the client first will result in a differentiated experience with our clients and an expanded relationship with them. That's the all-chips-in bet that were making. This early into the process we don't know if were on the right track, although the empirical data look good. In 20 years the interaction with clients will change, but I believe the core fundamental of being professionals meeting our clients' needs will prove to be a differentiator.
It's also important to believe that what you do really matters. We reward the shareholders: Don't be confused about that for a minute, but we do it in a way that matters. We are in a marathon even if it feels like a succession of 100-yard dashes. Our job is to win the marathon. You can't do that by making shortcuts or doing it on the backs of your clients. That will not sustain you in the long run.
Bill Rogers was interviewed by Tony Bingham and Pat Galagan.
Photograph by Gregory Miller