On a tour of a Wachovia branch a few weeks after its acquisition by Wells Fargo & Co., Carrie Tolstedt saw a teller give her manager something called a "service signal." When Tolstedt asked the Wachovia regional manager accompanying her about the practice, he explained that, per Wachovia's policy, customers who leave a branch unsatisfied are flagged for a prompt follow-up phone call.

"I left the branch, picked up the phone, called my sales and service leader, and said, 'How fast can we install this in the West?'" Tolstedt, says. Within a few weeks, the service signals were standard policy in all legacy Wells branches.

Such nimble management is far more than a flourish — it's central to Tolstedt's ambition to run the country's largest branch network as efficiently and successfully as Wells' smaller peers run theirs. Tolstedt has been overseeing Wells' retail banking since 2007, and with the acquisition of Wachovia nearly two years ago, she now commands a 6,600-branch operation with 120,000 employees in 39 states and the District of Columbia.

The task of the integration is monumental, but the company's enviable cross-sell ratings-now above 6.1 products per household at legacy Wells-suggest that her team has been able to take on the extra work from the merger without losing its focus on serving its original customer base.

One risk of such a large integration would be that the company's internal service culture would begin to drift, says Pat Callahan, who heads the merger transition effort, but Tolstedt "thinks up ways to communicate values to the front line."

Tolstedt credits her ability to stay on task to her diverse career experience at Wells and her exposure to an array of retail markets across the country.

She met CEO John Stumpf more than two decades ago, when she was working in Omaha for then-Norwest Corp. handling workouts in agricultural communities during the farm crisis. Stumpf, then running his own workout book for the company in the Twin Cities, was dispatched to check up on her operation and came away reassured. "Carrie can talk at levels of detail and nuance that no one else in our industry can," Stumpf says.

After Norwest acquired Wells (and took its name) in 1998, Tolstedt was given the responsibility of showing then-Wells executive Terri Dial around. The few days the two women spent talking about the business led to another responsibility for Tolstedt-a regional president position in California-that set her on a path into Wells' senior management.

Tolstedt makes sure that her subordinates receive the same opportunities for advancement that she had, and Stumpf says this has earned her intense loyalty from her the regional presidents and other executives who report to her.

"Her direct reports' average tenure with the company is probably 25 years, and most of these people grew up in the company with her," Stumpf says. "She gives her people more guard rails than rules."

Tolstedt's community banking division is the engine that drives Wells Fargo. It pulled in $60 billion in revenue last year and, in this year's second quarter, accounted for more than half of the company's $3 billion in net income.

Maintaining its centrality-and strong earnings-won't be easy given the strain an uneven economy, regulatory restrictions on overdraft fees, and costs associated with forthcoming consumer protection guidelines, but Stumpf hardly seems concerned. "I couldn't imagine having anyone better at navigating the new normal than Carrie and her team," he says.

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