Global agenda: Financial services

Whether and for how long this structure of deceit and lies can survive is a serious question in its own right. But so long as it does, we the customers must train ourselves to be aware.

money (photo credit: REUTERS)
(photo credit: REUTERS)
During a conversation the other day with the representative of a financial institution, I noted that while the second half of April had arrived, the end-of-year summary statement for 2014 from this particular institution had NOT arrived. “Worry not” came the reply, “they are being sent out in the next few days”.
“Good tidings indeed,” quoth I, “but why are you only sending them out now, at this late date, rather than several weeks ago, as most other financial institutions did?” “Because” – you gotta love this – “they weren’t yet ready,” she explained patiently.
Realizing that it was useless to pursue this line of inquiry further, I commented that this was a sad and pathetic state of affairs – at which she took umbrage. Worse still, at least from her point of view, I declined to take advantage of the “special offer” that she was very eager to tell and sell me.
This anecdote happens to relate to an Israeli bank, but the phenomenon that it describes exists in every type of financial institution – in this country as in every developed economy around the world. The issue is not one of technical details, such as the tardiness of sending reports or even the more substantive one of institutions proactively contacting customers to try and sell them something. Rather, both of these are merely symptoms of a much deeper malaise, although the latter is a much more obvious one.
Had I told the young lady that as a customer of her institution for the last 25 years or more I was entitled to lodge a complaint and to expect that someone would pay attention, she would have been completely mystified. She might have sniggered or laughed out loud, or she might have become uptight or reacted in some other way. But in every case, what is certain is that she would not have understood what I was talking about. Nor would her peers in New York, London, Sydney or anywhere else, let alone her third-world replacements in the call centers of Hyderabad.
All of the employees in all of these places are young people, usually with educational qualifications or on the way to getting them. However, they are used as disposable shmattes by the institutions that employ them, trained to perform a narrow range of functions and drilled to reach well-defined performance targets – or perish and be fired in the event of failure. Virtually none are acquainted with the concept of a service company being designed with the goal of serving its customers – and those few who recognize the concept know it only as a slogan, without having internalized it in any way.
Thus if you were to tell these employees/slaves/robots that there was a time when people in their industry (clerks in banks or insurance companies, investment advisers in brokerage firms or pension consultants in asset-management firms, etc.) were engaged in the same role for several years, sometimes even decades, in the same branch or office and were in regular contact with a group of customers whom they therefore knew well and who knew them well – in other words, they were part of a long-standing personal relationship that sometimes spanned two or even three generations – if you told them that, they would be amazed and confused.
They would not know how to function in that environment, and they would have difficulty getting their heads around the theoretical concept of that kind of relationship.
What they would understand almost instinctively, but in fact as a result of the “training” that has turned them into a precision instrument to achieve defined results, is that this kind of relationship is not based on quantifiable criteria. It does not relate how much of the employee’s time, if any, the individual customer gets to how much money the customer has, nor to the revenue that he or she can (read must) generate from the customer’s activities – right now, not in some amorphous, long-term future.
These employees’ own relationship with their employer is cut of the same cloth. It is not a question of what set of capabilities they have and how these could be developed and honed over time into a long-term relationship – once known as a “career” – that would benefit and satisfy both parties to it. It is rather a question of whether they are, or can rapidly become, configured to the needs of the institution, the department or the unit in which they work and whether, in that context, they can generate the quantifiable results that define successful functioning, that day, week and month.
The longest-term framework in which most financial-services employees work is the calendar quarter because their employing institution is geared to generating results that are publicly published quarterly and that determine the fate of the company’s senior management and hence of all the serried ranks beneath that level.
To cover up the crassness of today’s “relationships” between financial institutions and their hapless customers (who are increasingly forced to use at least their basic services by law and hence delivered into their hands), there has grown up a veritable “Newspeak” in which words and phrases are used that seem positive and welcoming but are in fact a smokescreen covering up the very opposite intent.
Whether and for how long this structure of deceit and lies can survive is a serious question in its own right. But so long as it does, we the customers must train ourselves to be aware of our vulnerability and to protect ourselves as best we can.