When starting up a bank or putting a branch in a new community, don't underestimate the benefits of luring popular employees from the established banks there.
The first benefit, of course, is that their customers may follow. For example:
A small New Jersey bank hired a manager for a new branch who had worked for a much larger rival for more than two decades. To celebrate her arrival the bank threw a party for the community. One loyal customer added to the festivities by socking $1,050,000 into a new account.
Another benefit is that your new employees can tell you what their old employers have been doing wrong.
I recently had lunch with Kevin Gillen, the central New Jersey marketing manager of the fast-growing Commerce Bank. Kevin had been at other New Jersey banks for years, but as he talked about Commerce you might have thought it was a religion rather than a financial institution.
"We provide good funds next day for any deposit in by 6 p.m. - not 3 p.m., like the other banks - so the business firm does not have to wait another day to use today's receipts," Kevin said. "And we don't delay crediting good funds more than one day in any circumstances.
"And not only do we have generous hours, including Sundays, but if we have a posted 7 a.m. start, we try to open 15 or 20 minutes early so the customers will feel they are special and can bank before regular hours," he told me.
"At my previous bank," he tattled, "we discouraged customers from seeing tellers, by making them wait at the wicket while we walked away on some pretense for a minute and then suggesting that for faster service they should use the ATMs.
"Best of all," Kevin said, "I am empowered to do what I think is right, without waiting for approval from on high."
He discussed a municipality that had agreed to have Commerce do its cash management and pay an agreed fee for the available funds.
"Do you have any other money you could deposit if you wanted to?" he asked. Informed that it had another $5 million, Kevin said, "You put that with us and you get an extra quarter-percent on the entire balance."
"How long will it take to get that approved if I put in the money today?"
"The new rate will start today."
Another banker who changed her stripes told me:
"A bank employee dedicates her life to service, to making her customers happy. You take pride in your work, and you want the power to make exceptions when necessary. You are embarrassed when your bank installs such procedures of control that you can no longer deliver what your customer needs.
"Customers don't ask for much," she said, "but when they need you, you must be there."
Smaller things also help make or break morale.
One officer told me that at the bank she used to work for, "if we had a teller who lived in Paterson, we might have her work in Dover," half an hour away.
"Another who lived in Dover had to go to Paterson to keep her job," the officer said. "You can bet we wouldn't let that happen here."
Another turncoat told me that his former bank said it was unprofessional for tellers to work sitting down, so it took away their stools.
That is a topic near and dear to my heart. A favorite story is how Gerry Lipkin of New Jersey's Valley National endeared himself to the tellers at a bank it had just bought by immediately declaring that they'd no longer have to stand all day.
But to some bank executives, morale seems not to matter.
Kevin Gillen told me of a visit he and his old boss had paid to a customer's office. It was near one of their branches, so they parked in the branch parking lot.
After the meeting Kevin suggested to his boss that they pay a morale-boosting visit to the branch.
"No, it's not worth it to me," the CEO replied.
Mr. Nadler, an American Banker contributing editor, is a professor emeritus of finance at Rutgers University Graduate School of Management in Newark, N.J.
