You Can Love Your Bank: An Interview With First Direct’s Marcus Golby

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The U.K.’s First Direct set out in 1989 to turn around people’s dissatisfaction with banking by giving them a purely telephone service alternative. In this edition of Inside Scoop, Bob Thompson talks to First Direct’s Customer Services Director Marcus Golby about the company’s commitment to customer service and the challenges brought on by changing technology. This transcript of the interview, conducted Nov. 2, 2006, was edited for clarity.

Bob Thompson

I’m very pleased today to welcome Marcus Golby, customer services director at First Direct to Inside Scoop. Marcus, welcome.

Marcus Golby

Thank you.

Bob Thompson

We’re going to be talking about First Direct and specifically, about how it is that you deliver a great experience to your customers. To kick us off, would you mind telling us about your background and current responsibilities?

Marcus Golby

Yes, no problem. My original background is that I trained as a chartered accountant and then worked in corporate finance, doing management buyouts, acquisitions and disposals. I joined HSBC in a change and strategy development type team in 2000.

My first real relationship management-focused job was restructuring HSBC’s branch network relationship management approach across the U.K., which I did for about 12 months. I then moved to First Direct, where I initially worked in a change environment. Over the last few years, what I’ve been doing is looking after operational areas, and my current responsibilities are all the customer-facing areas, apart from the credit teams, within First Direct. So that covers the frontline call center. It covers the mortgage and lending sales teams. It covers the Internet support teams and a range of other operational teams that deal with customer queries or the processing activities related to the products that customers hold or buy.

Bob Thompson

That sounds like a very challenging job. Before we get into First Direct, I wonder if you could share with me what you learned from your experience at HSBC in this change role.

Marcus Golby

I think the most important thing that’s carried me through into this current role is getting to understand how you actually want to serve the customer and what it is they want. There’s also a piece around setting customer expectation. There’s nothing worse than having set a huge expectation and then not delivering against it.

Bob Thompson

Good point. Now, looking at First Direct, can you take us back to when it was founded and tell us why First Direct was founded? What was the problem it was trying to solve in the market?

Marcus Golby

First Direct was established back in 1989. At the time, there was increasing recognition that customers were becoming more dissatisfied with being unable to bank when and how they wanted. It was about recognizing that fact and saying, “Is there a better way to bank?” Well actually, yes. So First Direct was built specifically to meet the needs of customers, which translated into delivering service excellence through a telephone environment 24 hours a day, seven days a week.

But it hasn’t remained purely a telephone bank. First Direct has evolved to make sure that it has remained true to it original purpose of providing customers with excellent service when and how they want it, and over 80 percent of our interactions with customers are now over the Internet, rather than on the telephone.

Direct channel


Bob Thompson

It seems like there were two things you mentioned. One is that having this direct channel through the phone or the Internet was something that your competitors were not offering. And secondly was the quality of service. Is that what you’re saying?

Marcus Golby

Absolutely. When we launched we were the first 24-hour telephone bank. It’s about understanding what customers want and how customers want to be treated and trying to do that, treating people as real people.

Bob Thompson

Well, that’s an interesting comment, treating people as real people. Can you elaborate on that? What’s so hard about treating people as real people? Why don’t your competitors do that, too?

Marcus Golby

That’s a good question. I think we set the service standard when we launched and are still used as a benchmark for excellence. More and more people understand that customers are not numbers. Customers are people. They want to be treated with respect. They want to have a human interaction with the people they’re dealing with.

Bob Thompson

Well somehow, First Direct has managed to be the “most recommended bank” in the U.K., according to the information on your web site, at least, for the last 13 years. That’s quite a remarkable accomplishment. There’s a lot of research in the last year or two about the power of recommendation and why that’s so important. How in the world did First Direct manage to not only do it for a year or two or three but for 13 years?

Marcus Golby

I think the core answer to that is that the customer is the heart of everything we do as an organization. It’s embedded in the culture. So we recruit people who fit with that culture. We recruit people who have a customer service mindset. So yes, we’re a bank, but we don’t recruit people for banking skills. We recruit people who have the mindset, who will deliver great customer service and want to work in a fun environment and deliver great customer service at the same time.

Bob Thompson

And that’s not so easy to copy, is it?

Marcus Golby

Well, I think you can take the mindset of: We want to recruit people like that. But, then, it’s: How do you train those people? Do you have a strong culture? Does the business have strong values that people can understand and work with to deliver that customer experience?

Bob Thompson

Right. Are there other service businesses, non-banking service businesses, that is, that you are modeling with First Direct?

Fantastic service


Marcus Golby

I don’t think we have one company that we say we aspire to be like, but what we certainly do try to do is understand what other people do. And—not in our industry, necessarily, but across all industries and all geographies—to understand what is it that they’re doing that makes their customers go, “Wow, that’s fantastic service!”

So for example, I spent some time earlier this week looking at how we’re going to develop our service proposition, and as part of that, I just spent a bit of time on the Internet looking at which companies are getting feedback about fantastic service. Ritz Carlton is one that comes out continually. They’re delivering great service. And you see other businesses which have certain “wow” factors in what they do. We want to be saying, “Well, how can we do that? How can we put that into our environment?

I don’t think there’s one particular company, but we certainly are doing a lot of scanning of the environment to say, Who’s delivering excellent service? Who’s getting the great feedback? Are there things that they’re doing that we can take advantage of in our business?

Bob Thompson

This approach that you take to your business, what do you call it at First Direct? Do you use the term, “CRM” or, customer experience management? Do you use some other term? Do you put a label on it of any kind?

If there’s an area where we need to understand things better, it is in terms of specific feedback from customers.

Marcus Golby

It’s a good question. We use the term, “CRM,” but that’s far more about the data and the understanding of our customer and providing our people in the front line with the right information to be able to deal with the customer in the right way. We talk about customer service, and we talk about delivering amazing customer service.

Bob Thompson

So not hung up on the labels?

Marcus Golby

No, customer service is in the fabric of the business, not just a strapline. It’s what we do. It’s what we continually strive to be better at. It’s not about labels. It’s about the way we do things.

Bob Thompson

Do you do research to try to build a business case for making investments in quality of service? You’ve got investment training—or maybe it’s systems or something else—to keep this leadership position, this amazing service that you want to deliver. And you’d have to spend some money and invest resources. How do you justify that internally? Do you have to create a financial case or is it just so obvious that you just do it?

Marcus Golby

Actually, that’s a good question. I think, in terms of the day-to-day service standards—almost the hygiene factors, you would call them—we do them because that’s what’s expected of the business. That’s what our customers expect. When we’re looking at new ways and new technologies, in order to improve our customer service, then yeah, we have to produce business cases to justify that investment.

Ultimately, great customer service isn’t an end in itself. As a business, you’re looking to make profits from what you do, and that comes through delivering great customer service. So ultimately, if we’re looking to change things, yes, we are looking at: What’s the business case there and what’s the payback on doing that?

Bob Thompson

I want to discuss how you get employees on board. You said earlier that you’re very careful about hiring the right people to begin with. Once you have them on board and you want them to deliver this great service, what types of techniques or reward programs or whatever do you have to keep employees doing the right things and having these satisfied customers?

Incentives


Marcus Golby

Elements of the reward for our people are based around the basic salary. On top of that, in sales focus roles, we have incentives around the sales that they make and, therefore, the income that generates the business. On top of that, we have an annual bonus scheme that looks at the hard elements, the numbers of the job that an individual’s done, and the softer stuff, the way that job’s being done. So, for example, we look at the way our frontline people talk to customers. We listen to calls and we grade those calls.

An element of grading those calls is around: How have you moved the customer? So if the customer came in not sounding very happy and the customer goes away sounding happy, then that’s a good call. You’ve added value. You’ve given a good customer experience there. It’s a mixture of the hard numbers and the softer piece around how have we dealt with a customer. I guess the third element is: Have you lived the values? How have you interacted with your colleagues within the business? Because it’s important that we work together. If we’re cohesive in what we do, we’re much more powerful as a business.

Bob Thompson

Are there ways that you get feedback directly from customers, through surveys or interviews? And if so, do you tie that back to reward systems?

Marcus Golby

If there’s an area where we need to understand things better, it is in terms of specific feedback from customers. So we look at customer satisfaction. We measure customer satisfaction as a whole on a monthly basis. In terms of individual pieces of feedback from a customer—for example, a compliments letter or something of that kind—then yeah, we’ll feed that back to the individuals and we will do something to recognize that.

In some of the areas on a weekly basis, we’re rewarding top performers. Some of that will be around the numbers. Some of it will be around the behaviors, as well. Going back to the original point, where we need to develop more is to get more granularity on the understanding of the things that make our customers think we’re special and the areas we need to improve on where we’re not necessarily excelling. So we’re looking at a program now to do more research about the individual interactions we have with our customers and what comes out as a result of those.

Bob Thompson

It sounds to me like you’re constantly challenging yourself to keep the company in this leadership position. What do you think is the biggest challenge that First Direct will face in the coming years because, obviously, you’re not a secret anymore?

Marcus Golby

I think, actually, the biggest challenge is that less and less of our customers are using the phone as a proportion of their total contact and more and more using the Internet. So, the question is, How do you give that personal touch in the Internet space, compared with how you can do it in the phone space? We’re continually striving to give that additional “wow” factor, for want of a better description, to customers in that Internet space so that the whole experience of First Direct, not just the phone experience, is fantastic.

I think the other piece is to look at all our processes continually and understand where we are getting customers’ value. Are we focusing on the things that are really important to the customer, or are we focusing on the things that are important to us? And if we’re focusing on the things that are important to us, how do we turn that to the customers’ advantage? So it’s about: How can we do things quicker? How can we make things easier for our customers to interact with us and to take full advantage of what we have to offer?

Bob Thompson

Last question for you, Marcus: If you were talking to another executive who wanted to head down this customer-centric journey that First Direct has been on for many years, what’s the single best bit of advice that you would give?

Marcus Golby

You have to recruit people who are focused on the customer. If you don’t have people and you don’t have a business that’s focused on the customer, you’re not going to achieve it.

Bob Thompson

Very good. Marcus, it’s been a great pleasure talking with you. Thanks for spending time with me on our Inside Scoop program today.

Marcus Golby

Thank you.

Marcus Golby

Marcus Golby, customer service director, joined First Direct in 2003 from HSBC. Golby’s role includes processing activities such as mortgage sales, lending, new customer team, outbound calls to customers, foreign payments, Internet support, banking services and cards, as well as call center activities.

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