Royal Bank of Canada recently captured top spot among Canada’s big banks in an annual survey of customer satisfaction by JD Power, knocking off TD Bank, which had held the honour for 10 years. Douglas Blakey spoke with RBC’s Kirk Dudtschak, to find out how RBC topped the poll
It’s just the latest in a growing list of accolades for RBC over the past few years, including best retail bank in the world, best payments innovation, and best use of data analytics. But the latest award – ranking first in overall customer satisfaction among the Big 5 Banks in JD Power’s Retail Banking Satisfaction Study – is among the most significant.
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RBI spoke with Kirk Dudtschak, RBC’s executive vice-president of personal and commercial banking, to find out how RBC is achieving these kinds of results.
RBI: What’s the value of winning these types of awards?
Kirk Dudtschak (KD): We take client service very seriously and are extremely proud of the recognition our advisors have received. These awards and rankings are a testament to their capability and commitment. The recognition is also a validation of our collective ambition and how we’ve embedded it within all that we do.
RBI: What do you mean by collective ambition?
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By GlobalDataKD: Our collective ambition frames our path forward as a company that is purpose-driven, performance-oriented and principles-led. It articulates who we are, why we exist, how we win and our aspirations for the future.
RBC’s collective ambition was driven in large part from what our employees told us during a global, real-time online conversation last year. In some form or another, they said ‘we’re here to help our clients thrive and communities prosper.’ It’s become our purpose and it underpins everything we do.
RBI: How has your collective ambition informed your business strategy?
KD: We believe that our future is one as a digitally-enabled relationship bank. How we serve our clients and cover a market or community is evolving to a combination of digital, mobile advisors and branch teams all working together to deliver an exceptional client experience to more Canadians, more often.
What that means in terms of our business strategy is greater investment in our digital solutions, and in the digital enablement and education of our clients so they can transact wherever and whenever they want. It means evolving our branches and the in-branch service experience so we can become centres to onboard our clients, provide education and advice and solve their problems.
We’re also investing in our advisers’ roles so we can develop natural and meaningful career paths and progression that allow them to grow in their careers, as well as investing in more mobile experts so we can meet with our clients wherever is most convenient for them – in branch, on the phone or in the community.
RBI: Can you give an example of how you’re integrating digital and people?
KD: We know that clients are looking for more convenient and integrated ways to manage their financial lives and at the same time value trust and confidence in their more complex decisions.
We also expect our employees to play a key role in the digitisation of banking, rather than be replaced by it. Clients can take advantage of digital tools to build their own mortgage or to invest funds, but our advisors are there to help them figure out their priorities and make important trade-offs.
An app can’t do that. That’s a trusted adviser. This combination of people and technology has given us a key advantage in onboarding new clients, acquiring a bigger share of wallet, and helping clients access the full strength of our capabilities – digital and people.
RBI: How are you getting employees to buy into it?
KD: Communication is essential. We’ve spent a lot of time at the national, regional and local levels engaging employees in our vision of a digitally-enabled, relationship bank. We’ve talked about the drivers of change – technology, demographics and evolving client preferences – and how we’re building the bank of the future. Employees want to understand why we’re evolving, how the future will look, and their role in that future. To that end, we’ve also given entry-level advisors a clear road map for becoming, say, a Financial Planner or Commercial Banker. We absolutely want our employees to know where we’re headed, what their role is, and how we’re stepping through the change together.
RBI: Can you speak to how you are changing to keep pace with client needs, deliver solid results and not incur a restructuring charge as many of your peers have?
KD: We started this work about seven to eight years ago, in terms of investments in our digital, branch and people capabilities to reflect how clients are changing and how they want to interact with us.
And we continue to innovate. We have a diverse client base and our newcomer clients are an important and growing segment, so we recently introduced a language line app for in-branch tablets. It helps branch staff communicate with clients in more than 200 languages, including sign language, using video conferencing with professional translators.
We’re investing in new and differentiated branch formats to reflect the communities we serve. We recently opened a store on McMaster University’s campus in Hamilton, Ontario. It is geared almost exclusively towards advice and education-based conversations with students about their particular needs.
We’re adding more expert mobile advisors to our teams – Financial Planners, Mortgage Specialists, and Commercial Account Managers – to meet our clients’ needs for more complex advice. These investments are part of the foundation we’re building for future growth.
At the same time, we maintained a strong focus on managing employee recruitment, personal development and career planning. We carefully managed the evolution of roles as I mentioned earlier as well as every position that turned over. It has allowed us to change as our customers change and to shift our workforce without the significant restructuring charges our competitors have taken.
RBI: JD Power noted that RBC performed well in all seven categories measured in the survey, including product selection, online and mobile phone capabilities, and level of personal service. What are the key reasons for RBC doing so well?
KD: There are three key reasons. First, we listen to what our clients tell us about their financial and service needs, and what they value most. We’ve been conducting client experience surveys for more than 20 years, and we share that feedback and coaching with our employees.
Second, we invest heavily in our people to build their skills and capabilities, including comprehensive learning and accreditation. It enables us to continue meeting all our clients’ needs, and grow and deepen relationships.
In fact, RBC ranked first among banks in share of wallet (defined as clients with a transaction, investment and a lending product with the same bank) for the past five years based on another survey, Canadian Financial Monitor, conducted by Ipsos.
And third, our strategy is based on deep client insights. We know clients want more than just convenient banking hours. We’re making smart investments that allow us to remain on their path, and extend our reach and impact in new and innovative ways.
It’s what I believe is clearly differentiating RBC from the competition.
RBC pips TD in 2016 JD Power survey
RBC ranks highest in overall customer satisfaction among the Big 5 Canadian Banks in the 2016 JD Power Retail Banking Satisfaction Study, achieving a score of 765.
RBC performs particularly well in all seven factors, most notably in product. TD ranks second with a score of 761.
The study, now in its 11th year, measures customer satisfaction in seven factors (listed in order of importance): product; self-service; personal service; facilities; communication; financial advisor; and problem resolution.
Satisfaction is calculated on a 1,000-point scale.
The 2016 Canadian Retail Banking Satisfaction Study is based on responses from more than 13,000 customers who use a primary financial institution for personal banking. The study includes the largest financial institutions in Canada and was conducted in April/May 2016.
EARNINGS: RBC posts record net income for Q316
Royal Bank of Canada (RBC) posted record net income of C$2.89bn for the third quarter, up 17% year-on-year. For the first three quarters of the year, RBC recorded net income of C$7.91bn, up 6.5% year-on-year.
Results reflect strong earnings in Wealth Management, which benefited from the inclusion of City National Bank (City National), and strong earnings in Capital Markets and higher earnings in Personal & Commercial Banking.
The results also reflected improved credit quality, with provision for credit losses (PCL) ratio of 0.24%, down 12 basis points.
“RBC had a record third quarter demonstrating the strength of our diversified business model and our disciplined risk and efficiency management. Our strong capital position enabled us to repurchase $292 million of common shares in the third quarter and I’m pleased to announce a 2% increase to our quarterly dividend,” said Dave McKay, RBC President and Chief Executive Officer.
“We remain focused on prudently managing risks and costs while innovating to enhance the client experience and deliver long-term shareholder value.”
