The attached short NYTimes article discusses how Wells Fargo has been trying to change its culture. Focusing on what you have learned about Organizational Culture (though drawing from other topic areas as well where appropriate), answer the following two questions
Based on this article, analyze Wells Fargo’s current organizational culture. Explain your reasoning.
Do you agree that the culture has likely changed? Why or why not?Wells Fargo Says Its Culture Has Changed. Some Employees Disagree.
Following are excerpts from a NYTimes article about Wells Fargo, by Emily Flitter and Stacy Cowley,
published March 9, 2019.
Wells Fargo was regarded for years as one of America's best banks. Then, in 2016, the bank:
admitted that employees had opened as many as 3.5 million phantom accounts in customers'
names to meet stratospheric sales goals. It also admitted forcing customers to buy unneeded auto
insurance and charging improper mortgage fees. Its top executives now say that because they
have eliminated the aggressive sales targets that spurred that bad behavior, the bank's culture has
changed. Many employees say that is news to them.
There is no evidence that employees are secretly opening accounts in customers' names or
tricking them into buying unnecessary auto insurance, as some did in the past. But Wells Fargo
workers say they remain under heavy pressure to squeeze extra money out of customers. In one
debt-collecting operation, workers in December were expected to handle at least 30 calls an hour
and recoup $34,000 in unpaid credit-card and other debts for the month. In January, the targets
rose to 33 calls an hour and $40,000, goals that many employees there failed to attain. "For us
front-line workers, there's an overwhelming sense of frustration," said Mark Willie, who is part
of a group trying to unionize Wells Fargo employees. "There is a general fear of retaliation for
speaking out."
Wells Fargo executives said in interviews that the bank's culture had improved and that fewer
bank employees had direct financial incentives to sell products to customers. "Our entire system
of how we pay, coach and develop team members is designed to focus on customer experience
and customer outcomes," said Mary Mack, Wells Fargo's head of consumer banking. "Things
have changed a lot." At the heart of its rehabilitation efforts, Wells Fargo said, it has changed
how it motivates employees. No longer will they be individually rewarded for reaching sales
targets or punished for falling short. Branch workers were told that their primary job is to serve
customers, not sell them things.
But the sales incentives have changed, not disappeared. In the past, branch workers were eligible
for bonuses if they persuaded customers to apply for a credit card or to take out a loan. Now,
employees are urged to refer prospects to salespeople in the bank's mortgage or wealth
management division, and some branch workers are eligible for bonuses if those referrals turn
into sales. One personal banker said he had ethical qualms about trying to sell more products to
his customers, who are mostly college students and retirees with limited money.
One former salesman, who sold credit-card-swiping terminals to businesses on the East Coast,
was required to book at least 15 sales meetings a week. For every 30 opportunities he logged, 10
needed to result in a sale. His calendar had to show regular meetings scheduled with Wells Fargo
branch managers, whom he was told to lobby for introductions to potential customers. The
salesman said that when his managers had wanted him or his colleagues to ratchet up their sales,
they had used coded language: "We're not helping enough customers."