A danger for CEOs of major banks is that they focus too much on the macro at the expense of the micro, writes Brian Caplen. Reading customer complaints would help them get a more balanced view.

Bank CEOs are measured on the strength of the share price. To make shares go up, they must deliver profit growth by increasing revenues and cutting costs. For this to happen they need to have a big picture view of the business, leaving implementation to a small cadre of senior managers. The secret to success is delegation.

But CEOs who delegate everything and never 'kick the tyres' of the business leave themselves vulnerable to the failure to pick up underlying business trends and to customers voting with their feet.

How to stay in touch? There are the CEOs who like to turn up unannounced at credit committee or strategy meetings at which they are not expected. There are CEOs who make a point of visiting as many branches in a year as possible and talking to staff. And there are those bank executives who take the trouble to read customer complaints. All three approaches are hugely valuable.

Royal Bank of Scotland’s CEO of corporate, commercial and private banking, Alison Rose, who is tipped to succeed chief executive Ross McEwan, takes the customer complaints home to read at weekends, a trait mentioned in the press previously and that she reiterated on a panel discussion I chaired at last year’s FT Banking Summit. She says she wants to see what people are angry about.

Only with this kind of raw information can a CEO build a credible strategy. Very often modern corporations deliver bad service and have few channels for discovering why. Instead of encouraging aggrieved customers to complain directly they fob them off with anodyne surveys that reveal little or nothing.

Reading the customers’ complaints should be in the terms and conditions of a CEO’s appointment. 

Brian Caplen is the editor of The Banker. Follow him on Twitter @BrianCaplen

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