Wells Fargo–How will they recover?

BY Elizabeth Carlson (’17)

I have learned through research and listening to the news that many stable companies go through some kind scandal. The main questions that follow a scandal becoming public are: “How will they recover?” and “Are they still a trustworthy company?”

Some companies have very loyal customers who will believe in a company no matter what happens. Others who may not be as loyal may move on to other brands or companies.

This is what happened at Samsung, when they had major malfunctions with their smartphones. Some customers still trust Samsung, while there are others who will never go back to that company again. For customers, it all depends on how the company reacts to the scandal or the problem.

As for Wells Fargo, they are in the middle of an investigation into employees creating fake bank accounts to meet very unrealistic sales goals. According to CNN, the company’s employees have made over two million fake accounts since 2011. When the scandal broke, the bank fired 5,300 employees and was fined $185 million.

John Stumpf was the Chairman  & CEO of Wells Fargo but now Tim Sloan has taken over, and he is on an apology tour. During one of his talks he said, “The core values of Wells Fargo are as true today as they were a month ago, a year ago and 164 years [ago]. However, we had problems in our retail bank where products became the focus, rather than the relationship with our customers.”

The last line of Sloan’s quote perfectly explained what happened to Wells Fargo and what really shouldn’t happen in a business. But the reason for the fake accounts was because many employees felt a great amount of pressure to meet goals. According to CNN Money, from the fake accounts the employees were able to boost their sales figures and make more money than usual.

Wells Fargo is trying to regain the trust of its customers, but this is a tough situation to bounce back from. Current employees of the bank have said they are ashamed and feel anxious about what is going to happen. In times like this, the company needs to take positive steps going forward.

According to the Wall Street Journal, Wells Fargo retail-banking chief Mary Mack has quite the task on her hand today. She has to try to figure out a way to change the sales culture without trying to repeat the same behavior that has just recently happened.

Customers are understandably outraged at the bank and the actions employees took without them knowing. During the World Series, the bank aired a 30-second commercial apologizing for what happened. Wells Fargo is reaching out to its customers to apologize and regain their trust. It will take time for the company to get back on its feet after this big of a scandal. There are still ongoing related investigations into Wells Fargo’s operations, so the hole they’re in may still get deeper.

Featured Image: By Sara goth (Own work) [CC BY-SA 3.0 (http://creativecommons.org/licenses/by-sa/3.0)%5D, via Wikimedia Commons

2016-09-30-fyf-elizabeth-carlson-dsc_0057-thumbnailElizabeth is a senior graphic design major and an advertising minor. When she is not in the classroom, she is Assistant Design Editor for The Wood Word, or she is playing for the women’s soccer team at Marywood. 

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