From huddling with local business leaders to bantering with high school and college students, CEO Tim Sloan returned to Detroit last week in a homecoming highlighted by personal memories, career successes, and a vote of confidence from the city of his childhood.
Sloan spoke on March 15 at the Detroit Economic Club, a historic business leaders group in the U.S. auto industry’s traditional center, now on the rebound from the Great Recession. Some familiar faces filled the audience, including his wife and parents, who had flown in for the event, team members, customers, students, and even old high school friends.
Mark Schlissel, president of the University of Michigan — Sloan’s alma mater — and a friend, introduced the CEO with a brief biographical sketch, from his childhood in the Detroit suburb of Birmingham and his academic career to his rise in the ranks at Wells Fargo. “We are delighted to have him back in Michigan today to share his insights and knowledge about leadership, innovation, and the financial services industry,” Schlissel said.
In his debut as the club’s featured speaker, Sloan recalled growing up and hearing his father, Jerry, who worked in public affairs for Ford Motor Co., talk about the organization, the speakers, and the leadership values they inspired.
“He would come to these meetings often, and believe me: I learned a lot from what he told me about them,” Sloan said in a Q&A session as he gestured toward his parents in the audience. “I can say one of the reasons I’ve been as successful as I have been is because of these two people sitting right there.”
A moderator of the event asked Sloan what impressed him most about Detroit’s recovery these days, as both the city and Wells Fargo are “midway through a transformation.”
“I think it is the resiliency of the city,” Sloan said. “We have a number of good customers here, many of whom are in the audience today. So we do a lot of business here and I have the opportunity to come back and see how well our customers are doing. What really impresses me is the tremendous commitment that’s been made, the reinvestment in residential and hospitality, all across the city. I mean it is just incredible, and I think it is a real model of what can be done in urban areas around the country.”
Sloan noted that Wells Fargo has contributed a number of grants to the city to support its recovery. (The latest involved a $1 million award to the Cities for Financial Empowerment Fund that provides financial counseling and other services to help lift people out of poverty in Detroit and 11 other markets across the U.S.)
When asked about Wells Fargo’s progress in rebuilding trust amid sales practices and unauthorized accounts issues, Sloan detailed the actions taken since he became CEO in October 2016.
Among them, he mentioned that executives acknowledged their accountability for the mistakes, initiated efforts to identify the problems, recognized a Community Bank sales incentive plan “that had gone off the rails” and replaced it with one that is now working. He also noted the changeover in certain leaders who were accountable and in the organization itself, which had become too decentralized and unaccountable.
He also said the company is reviewing operations and processes across the company “to make sure we are doing things correctly. And if we are not, we are going to raise our hand, and be very transparent about it. We’ll fix it … and if there is any customer impacted, we are going to make it right by them.”
Sloan acknowledged that approach “doesn’t create a lot of good headlines,” but the upside is “this incredible company is performing incredibly well, because of our people who are the best in the industry.” He noted the increase in communication with team members, compensation increases such as raising the lowest pay rate to $15 an hour, and the systemwide changes that focus on customer service have all contributed to the highest employee retention rate in years.
“You have to realize that no matter how important I might think my job is,” he said, “the people who really know what’s going on with Wells Fargo are the people who work with the customers every day.”
Sloan’s comments resonated with business leaders and others in the audience.
“In any situation where a company’s senior leadership faces issues like this, the first thing to do is admit the mistakes, identify the causes, and do something to fix it,” said Steve Grigorian, president and CEO of the Detroit Economic Club. “He’s doing that. He’s following through with action, not just words. And that creates confidence when people see it.”
On a personal note, it was particularly meaningful for Sloan’s wife and parents to be there for his presentation in their former hometown.
“The feeling is just beyond belief,” said Jeanne Sloan, his mother. “For a mother to see her son up there, so smart, so successful — and happy, too — it is just amazing to me. And I am so thankful.”