28 November 2006
Finsec's position is based on discussions with affected Priority staff over the past week. Information has been collected by way of face to face or phone interviews with affected staff during the week of November 20 - 24. Forty nine full interviews were undertaken with staff, with a number of responses still to be sent in. Most were Finsec members, with some non-members also participating
Requirement for Change
Many staff have commented on their surprise at such a major change in an area of the business that is generally perceived to be functioning well. Customer satisfaction rates are consistently high, and Priority Banking has a strong reputation for getting it right first time in line with the "Ask Once" policy.
While Westpac has raised a number of issues in relation to a changed business environment and areas in which improved performance is desired, the wholesale changes in the proposal are seen as unjustifiable. Staff and Finsec are not unwilling for there to be change, but we strongly believe that in-depth discussion with staff should have taken place prior to the current massively disruptive and untested proposal.
Structural Issues
Of central concern to staff is the proposal for Personal Sales Support Officers to be based at three centralised sites away from the Personal Managers they will support. This concern was raised very strongly by both Priority Managers and Priority Consultants.
There are several key issues that have been raised in this respect:
- That the on-site support offered by Priority Consultants to Priority Managers is an essential part of the service delivered to Westpac Priority customers. Both Priority Managers and customers in this space have come to expect quick turnaround when it comes to document preparation and a range of other timeframes. On-site support with consultants directly attached to Priority Managers means that this level of service can be delivered, with key documents generally prepared on the day they are requested. Centralisation of the Support teams, and the breakdown of a direct relationship between Managers and Consultants will inevitably mean that this level of responsiveness will not be able to be maintained. The results of this are likely to be greater levels of stress on staff, and reduced customer service and satisfaction.
- Current arrangements allow for a degree of flexibility when Priority Managers are away for some reason. Given the relatively small number of Personal Managers, these absences create significant service level issues. Under the current arrangements however, Priority Consultants are able to step up and cover the work of Personal Managers on these occasions, ensuring that disruption to customer service is kept to a minimum. The shift to off-site support will mean that this will not be able to be done. Serious concerns were raised by many staff as to what would happen under the proposal when Personal Managers are away. There is no reference to relief provision in the proposal.
- Both Priority Managers and Consultants have expressed strong support for the current arrangement that allows Consultants to know and intimately understand the customer base. This provides huge advantages, in terms of covering work when Priority Managers are absent, building a strong ongoing relationship, and easing the pressure on Priority Managers at times when they have more complex work on their hands. Both Managers and Consultants strongly feel that that the relationship between Consultant and Priority customer is an essential part of the service package offered by Westpac. The shift to centralised support teams will break down this relationship, reduce customer satisfaction, and potentially cost Westpac customers.
- Many staff commented that even if Westpac encourages customers to use the 0800 number, that many customers will choose to contact Personal Managers directly because they are used to a direct contact, and value having a personal relationship with someone at the bank. This is likely to undermine the new strategy, and result in an increased workload for Personal Managers.
- Additionally, many Consultants are concerned by the shift to a call-centre environment that will see them effectively lose the face to face customer contact that is a part of their current roles. There will be an impact not just on customer service, but on staff satisfaction should this change proceed.
- There is widespread concern that a call-centre structure will have difficulty coping with a group of clients who are often complex and demanding. The success of the current model in dealing with this is the fact that Consultants, as a first port of call, have had the ability over time to build strong relationships and understand these complex needs. The call-centre structure will simply not be able to maintain this level of relationship as customers will be interacting with a team of up to 13 Support staff, rather than someone with a thorough understanding of their circumstances, needs, and peculiarities.
- Many staff noted that the model of separating Relationship Managers from Support staff has been followed in both Business Direct, and by the BNZ. The model was tried, tested, and abandoned in Business Direct. There is no analysis of this attempt within the proposal that has been presented to staff - only the potential positives have been highlighted.
Staff also strongly feel that the re-structure effectively downgrades the status of Priority Managers. It is seen as inappropriate for Personal Managers to report to Branch Managers, when their customer base will in fact cover clients over an area that stretches over a number of branches. The "Priority Relationship" title establishes PM's as managers who deal with customers the bank feels are important, and from the customer's point of view is perceived as having a higher status than the more ubiquitous "Personal Manager".
Many Personal Managers are also concerned that the shift to branches will leave them in potential conflict with existing branch staff, particularly HLS's who also have discretion up to $750 000.
Both Priority Managers and Consultants have expressed concern at the ability of a centralised Support team to complete Insurances as efficiently as is possible now with Consultants on-site. The proposed model will potentially result in double handling in situations like these, a loss of efficiency, and potentially PM's having to complete tasks of this nature as it will just be simpler and quicker.
There is strong concern that under the proposal, Personal Managers will inevitably be drawn into a leadership role within the branches. PM's will be a logical "fill in" for Branch Managers when they are absent, and the skills and experiences of PM's will be a useful resource for other lenders within the branch. While none of these things occurring are "bad", the reality is that PM's have extremely high workloads and simply do not have the time to undertake a wider range of duties, which may evolve more informally in the branch rather than being a formal part of the job description.
Positive Comments
Some staff have expressed support for reviewing where customers are placed within the service chain. As such, the proposal to consider shifting some higher value customers into the Private Bank space, and some customers into the branch space, is seen as sensible. Our view remains however that their remains a significant space for a dedicated Priority Team operating along similar lines to the current structure.
Investment
Of fundamental concern to many staff, and to Finsec, is the fact that the proposed new structure represents a policy of divestment.
At a time when Westpac needs significant investment in order to lift customer satisfaction and numbers, this proposal sees staff numbers cut in one of the areas in which high levels of customer satisfaction have been achieved.
An analysis of the overall numbers under the proposed re-structure reveals this starkly:
| Total Priority Managers Now: | 69 |
| Total Personal Managers & Private Advisors under Re-structure: | 58 |
| Reduction | -11 |
| Percentage Reduction | -16% |
| Total Priority Consultants and Support Now | 45.6 |
| Total Personal Sales Support under Re-structure | 33 |
| Reduction | -12.6 |
| Percentage Reduction | -28% |
Overall staff numbers decline from 114.6 to 91 under this proposal. This is a reduction of 23.6 FTE's; representing a 21% reduction from the current staffing levels.
We believe that this divestment strategy runs contrary to the kind of model that Westpac needs to deliver sustainable growth, that it will de-moralise staff, that it is the cause of low levels of customer satisfaction across other areas of the bank, and that it represents a failure to properly engage with staff to find creative solutions to business problems identified by Westpac.
We also believe that this divestment strategy runs counter to Westpac's public commitments to investing in New Zealand. In particular it is of significant concern to us that the proposal sees a significant withdrawal from provincial New Zealand. PM numbers outside of the three main centres drop from 18 to 14 under the proposal (-22%) while Support staff numbers outside of these centres are cut from 11.3 to just 3 (-77%). These cuts in provincial regions are not made up for in the main centres either. In these areas the overall number of PM's and Support staff drop by 7 and 4.3 respectively.
Fundamentally this divestment approach is not a business strategy that will deliver good results for the business or for staff, and we oppose it strongly.
Other Issues
The proposed re-structure, even if unaltered, offers no certainty for staff. Affected staff are not guaranteed a shift to comparable jobs, but will have to apply, with the possibility that external applicants may be selected ahead of them. Given the specific nature of the Priority customer base, and presumably the wish for any re-structure to roll out seamlessly, it seems counterintuitive to potentially bring in new staff instead of existing staff at this time.
Quite aside from this, there is a basic level of unfairness in the bank creating huge uncertainty over the Christmas period for staff through the proposed re-structure, and then not even providing the certainty of jobs that will definitely be there. We strongly believe that existing staff should have first preference over any comparable jobs arising out of any re-structure.
Significant issues around travelling distances and parking are likely to arise out of the re-structure, particularly for Priority Consultants in main centres who may be asked to transfer to central location form current suburban locales. This issue will need to handled sensitively through any re-deployment process, and genuine consideration given as to whether long travelling distances may impact upon the comparability of roles on offer.
The proposal for centralised Call Centres will also potentially impact on current hours of work arrangements for Priority Consultants and Supports. A number have agreed arrangements that take account of personal circumstances. Through any re-deployment process we would strongly urge Westpac to respect any such arrangements that have been entered into in good faith.
Staff are extremely unsettled by the suggestion that the proposed Sales Support team will be reviewed again in mid-2007. This will create great uncertainty and a loss of morale for the affected staff. If a thorough re-structure of Priority banking is to be undertaken, it should be done with a high degree of consultation and forethought, and as a result be durable enough to last for far more that six months.
Priority Managers are concerned at the security implications of being based in branches when they work different hours from other branch staff. This will result in PM's sometimes being left working in branches late into the evening, and then exiting the building on their own. There is no reference in the proposal to this issue.
Finsec Position
Staff reaction to the proposed re-structure has been very strong and needs to be listened to. The issues raised by staff are consistent across different parts of the country, and across the different positions involved.
Staff and Finsec are willing to engage with Westpac about this issue, but the current proposal is strongly opposed. In particular we oppose the divestment strategy evident in this proposal. It is unacceptable and irrational for Westpac to reduce staff numbers by 21% in an area of the bank that is achieving customer satisfaction ratings that other areas are being exhorted to strive for. This approach runs counter to many of Westpac's commitments to both the public and Finsec to be a socially responsible employer that invests in staff and the community.
We believe that staff working in Priority Banking are the people who understand the workings of the business the best. The clear view of staff is that both the overall reduction in staffing numbers and the proposal to split Personal Managers from support staff, with the former in branches and the later in centralised teams, will lead to difficulties for staff, reduced customer satisfaction, and potentially customer loses.
Staff and Finsec are willing to talk about change, but the proposals on offer represent a wholesale change in strategy that is not justified by the evidence on hand. We have strong concerns about the rushed process too. The proposed changes would see major changes for staff involved and effectively the dis-establishment of the current business unit - yet staff have been given just one week to respond.
Finsec's Recommendation
Fundamentally staff and Finsec oppose the proposal as it stands, and we call on Westpac to pause the current process and allow some genuine and wide-ranging consultation with staff about the current operating model, the bank's concerns, and possible solutions.
