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Wells Fargo responds to criticism over recognition spending

February 19, 2009

Wells Fargo, the mortgage financial giant, has been under some scrutiny lately for the company’s spending on employee award and recognition events in light of their financial situation.
Recently, John Stumf, Wells Fargo’s CEO, had had enough. Responding to the harsh criticism, he took out a full page ad in USA Today to publicly defend his position and communicate with his employees. Read his message reprinted below. We had mixed feelings after reading his impassioned plea. We might argue his math when it comes to calculating profitability, but I think we have to admire his passion for his people. What do you think? Leave a comment.
–Below reprinted from USA Today Monday, February 9, 2009–
The Value of Team Member Recognition

Okay, time out. Something doesn’t feel right.
Everyone agrees that in this economic environment, all employers should re-examine how much they spend on recognition events for their employees. Especially publicly-traded companies owned by their shareholders. Especially institutions that received investments from U.S. taxpayers through the U.S. Treasury’s Capital Purchase Program.
The problem is many media stories on this subject have been deliberately misleading. These one-sided stores lead you to believe every employee recognition event is a junket, a boondoggle, a waste, or that it’s for highly-paid executives. Nonsense! Because of the misperceptions these stories have created, Wells Fargo has decided to cancel all its major annual recognition events for its team members for the rest of this year.
So who gets hurt when this happens? The Wells Fargo team members across America who are most deserving of recognition and our gratitude. Tellers, Personal bankers. Phone bankers. Financial advisors. Mortgage salespeople and processors. Operations clerks. Technology specialists. Credit analysts. All of those who make it possible for our customers to save, invest, own homes, and build businesses that create jobs – team members who enabled us to make more than a half trillion dollars in new loan commitments and mortgage originations in the last year and a half. These team members work long hours to support their families and to make sure we give our customers the very best service we can possibly give.
Annually, for the past 20 years, we’ve recognized our top team members from various businesses at several special four-day events, like the one we had planned for our terrific mortgage team who helped us originate $230 billion in mortgages in the last year. For many, it’s the only time in their lives that they’re publicly recognized and thanked for a job well done. This recognition energizes them. It inspires them and their team members to want to create an even better experience for our customers. Another annual event – which our top performers in community banking had all looked forward to – was to have been held in May. But not this year. Who loses besides our team members? The workers who depend on our business. The hospitality industry. Hotel housekeepers. Restaurant servers. The airlines.
The funds to pay for recognition events such as these do not come from the government. They come from our profits. We believe our profits actually increase by rewarding and recognizing our best performers in sales and in service. Competition to be recognized inspires everyone to work harder and smarter. We’re as frugal as any company in spending our shareholders’ money thoughtfully and responsibly. Events such as this are the heart of our culture because our product is service, delivered by caring, energized, talented, loyal team members who earn competitive, fair wages and benefits.
We just hope the hardworking people of America understand, appreciate and support employers who try to do the right thing for their team members, customers, communities, and shareholders.
Since we aren‘t thanking our award winners in person this year, we’ll have to do it this way. Thank you, all our 281,000 team members.
You are the best!
John Stumpf
President and Chief Executive Officer
Reprinted from USA Today
Monday, February 9, 2009


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