Thirty Minute Mentors Podcast Transcript: Citizens Bank CEO Bruce Van Saun

I recently interviewed Bruce Van Saun on my podcast, Thirty Minute Mentors. Here is a transcript of our interview:

Adam: Our guest today is a fortune 500 CEO and the leader of one of the largest commercial banks in the country. Bruce Van Saun is the chairman and CEO of Citizens Financial Group, also known to the Philadelphia Phillies fans as Citizens Bank. Bruce, thank you for joining us.

Bruce: My pleasure, Adam.

Adam: The naming rights deal with the Phillies came in 2003, which was 10 years before you became the CEO. But to someone like me who's an Angels fan in LA, a big part of your company brand is connected to having your name on a major league ballpark. Can you talk about your approach to branding and your advice to listeners on the topics of marketing and branding?

Bruce: I did inherit that 10 years into a 25-year deal. And I do think for a Super Regional Bank, to have your name associated with a ballpark can be advantageous, especially when you're outside of the footprint and people don't see your local signage. So the local retail branch signage is one way to convey your brand and your image. But the naming rights on the ballpark. And having that picked up nationally for Game of the Week, etc, also can be helpful. I think what we're seeing now, increasingly, is that the actual top-of-funnel advertising around the brand is carrying more weight as we move towards a digital environment. So there's less people coming into branches- you don't convey your brand as much that way, the old-fashioned way, if you will, as you’re now going through digital channels. And then you have to make sure that you're getting impressions out there with your customers. So we're going through that metamorphosis. And so probably less of our marketing is going directly towards product and we're reallocating more of that towards who is Citizens Bank, what do we stand for? What kind of a bank or how can we help you on your life's journey? So that's been a pivot that's happened probably over the last two years, which has now accelerated as we move through the pandemic faze and all of digital has certainly moved forward by two or three years.

Adam: Digging a little bit deeper on that, I'd love to know how you think through differentiating your bank, given that you're in an industry that, from the outside looking in, can be categorized as a lot of different players without a lot of differentiation. So for listeners who are trying to figure out how they can differentiate their product or service, what advice do you have?

Bruce: Yeah, I think there's some broad principles that you want to establish, like, what does this bank stand for? And what we've, I think, carved out some nice space for ourselves is we're a very customer-centric organization. So we want to be, if you're an individual, a trusted advisor on life's journey, or if you're a company, we want to be your trusted advisor as you navigate your business challenges. And so that permeates the organization. And it's, you know, I think something that people recognize that when they have a relationship with Citizens, they can feel that difference. We're also other things that we think are distinctive, and that is that we're very good operators. So we run with excellent financial and operating discipline, so easy to use, simple, trying to continue to grow in that vein. And then we have a commitment to excellence. So whatever we do, we want to be kind of top drawer quality throughout the whole organization.

Adam: So if someone's listening to this conversation, and they're an entrepreneur or outside of the financial services industry, but they're trying to understand how they can differentiate their product or service that may be perceived by the marketplace to be commoditized. What advice would you have for them?

Bruce: You try to look for that look. You try to establish how the product can benefit you. And this is why we're the best company to deliver that product. And this is what we stand for. This is our company's purpose. We want to be very supportive of you. We think the product can really work for you. Here's how. Really, that's, that's how I would pitch it.

Adam: You’ve been a C-level executive at major financial institutions for the past three decades, and the CEO of Citizens Bank since 2013. But I'd love it if you could take listeners back to your early days. What drove you to pursue a career in the world of financial services? And what were the keys to your professional success as you were building your career?

Bruce; What's interesting, Adam, is that initially, I went to undergrad and I got a CPA, went to MBA, major in finance. And I kind of knew all along that I was strong in math and in analytics. And I figured that would be a good way to launch a career by having a good grounding in accounting, finance, and economics. And so every position that I took, I took my first job out of the MBA was with a Fortune 500 company, because what was hot then was working in consumer products companies, and I worked for General Mills. What was interesting, it was almost serendipitous that I moved over to banking. But long story short, General Mills was going to spin off their nonfoods division, I was in New York, and I just got engaged and my wife was moving up, my fiance was moving up from North Carolina. So I basically talked to a recruiter and he said, if you guys want to have dual careers, you should stay in New York, you should move over to financial services, I've got a great job for you. So anyway, I've kind of took what I had learned in finance at General Mills just went over to Kidder Peabody and Kidder Peabody, the whole investment banking industry was learning how to run themselves beyond being partnerships that they were trying to import people who had more sophisticated approaches around strategic planning and financial management. So that's how I got my start in financial services. And, you know, what I did all along was reach for big jobs, reach for challenges, be willing to take some calculated risks, to bet on myself. And try to grow. I always try to push myself to make an impact wherever I was- to kind of line up and work for really good people I thought I could learn from. So those are, those are some of the ways that I got the kickoff to my career.

Adam: What were the most important skills that you developed over the years? And what skills would you advise anyone listening to this podcast to develop?

Bruce: Yeah, well, you need a very good business acumen. So whether that's on the finance side or the marketing side, you need to know, you know, how your company can be positioned to grow and be successful. And, you know, being able to do the analysis to support your ideas, being decisive when you're forced to make decisions, and gathering the information. Don't overcomplicate things, hear the pros, hear the cons, but then be willing to make decisions is really important. Being an effective communicator. So being able to advocate for your position as you're coming up the ladder, and being a consensus builder, being able to understand the cultural dynamics of a company so that you can win your point of view. Those are all things that go a long way. Also, I'd say one other thing is to just be very self-aware in that you know, a lot of people coming up the ranks will think about, you know, I like hearing all the praise during my reviews, and I'm not so sure I agree with some of those things you're telling me I should be better at. But you should actually have a mindset that you don't need to hear a lot about the things that you're strong at. But you need to constantly look for opportunities to improve yourself. Where can I get better so that I can move up the ladder and move to the next level?

Adam: Bruce, I love that. And I've written and I speak extensively about leadership and the core principles of effective leadership. And the first thing that I talked about is self-awareness. To me, you cannot be a great leader without understanding who you are, understanding your strengths, understanding your weaknesses. And that starts with having a very, very strong and deep self-awareness. And I wanted to ask you, along those lines, in your view, what do you believe are the core principles of effective leadership? And what can anyone do to become a better leader?

Bruce: Well, I think you have to bring your authentic self to work. So people want to see who you are. They don't want to see a kind of this is the Work, Bruce and this is the Play Bruce, but this is who you are. And you're thoughtful, you're hard-working, you're always well prepared. You care about other people. All those things go a long way. Feeling and being genuine and having people feel comfortable around you and comfortable following you. So I think, you know, a leader needs to be able to paint a vision, and then take people along- get them to understand why this is where we're going and how they're they play an important role in making that happen. A good leader recognizes that you need a strong team, that you can't be the person calling all the shots, but you're going to benefit greatly if you have however many direct reports you need, if it's 6, 7, 8, that you bring people who are really strong, and you can empower them and get a lot of leverage from them. And they play as a team. And they like to work collaboratively as a team, and they don't have personal agendas. So those are some of the lessons that you learn that effective team building, setting the right culture, setting the vision, getting alignment around that. If you get that right, a lot of success in the company will just fall from that.

Adam: You lead an extremely large organization. How do you develop leaders within your company? What is your focus around leadership development? And what can anyone listening do to become a better leader?

Bruce: When I took the job back in 2013, I had 12 folks on my executive committee, and here it is, seven plus years later. And I've got one remaining out of those 12. So over time, we kind of let people contribute when they hit their ceiling. We've gradually moved some folks out gracefully with dignity. But we brought in people who've seen what good looks like at other places and so when you build a team of high-powered people who've had success out elsewhere, who've seen what good looks like elsewhere, they come into the organization with some fresh insights. And then they have followership. There's other people who want to come and join them and the flywheel starts going and then the whole organization improves quality. So there is an element and sometimes you need to come in and upgrade people. The other aspect in parallel is you've got to look for your next generation. You're kind of up-and-coming leaders, how do we get more out of them? How do we develop them? And so we've had a huge agenda around that here at Citizens. And I have a top HR team and talent organization. And we've actually worked with outside organizations to design classes to help people develop as leaders. One was adaptive leadership, how your style needs to change based on the different people that you're leading, or based on the situation you find yourself in, we built a full simulation about how a bank in a cyclical industry is going to go through ups and downs and how to navigate through the shoals of some of the tricky aspects of that over, say, a five-year plan, we built a whole case study and put teams together from our leadership team and had a competition to see who could get the best results over a long period. So we've spent a lot of time and effort on that. And I think the result is apparent, we've had a nice string of success. And it's a combination of upgrading talent and bringing in some senior folks, but then also giving other folks an opportunity to step up and grow and take on some big roles. My head of consumer today is 42 years old, and he's got over 18,000 people, he's leading about 10,000 of those 18,000 people. So that's a combination of folks like him who were here already, who we've invested in plus some great people that we bought in like, like Don McCray, who was a senior person at JP Morgan, who now runs our commercial bank, and he's been around the block, and he's got the gray hair, and he's got a lot of respect in the organization. So we got, we got the whole gamut here at Citizens.

Adam: Along those lines, can you talk a little bit more about number one, what you look for in the people who you hire? And number two, what you believe the keys are to building a winning organizational culture?

Bruce: Yeah. So, you know, what we look for is, first and foremost, just people with a great track record, with the right experience, a demonstrated record of success in building an organization and achieving growth. Ultimately, at the end of the day, every successful company needs to be able to grow. So there's the qualifications, the smarts, the work ethic, all those things, the integrity, but then there's really the second lens is the cultural fit, is this person going to fit inside our leadership team, and be a good collaborator and not bring personal agendas or big ego. Is that somebody who we think could meld into the team? So typically, when I'm hiring, I would set up a panel and have you know, five of our core executive committee members will sit down and go through detailed interviews with the folks and then we'll compare notes. And interestingly, we're almost always on the same page. It's a good and rigorous process.

Adam: So given your extensive experience hiring people at the senior levels and also along the way, I would imagine you've hired people at all levels, what are your best tips on the topic of hiring? What are some common pitfalls that you've seen? And what advice do you have for anyone on the topic of hiring?

Bruce: I think it's good to get multiple folks to get involved in the process. So you can get an in-depth understanding of a person's true capabilities and accomplishments, but then equally as important is their personality and their fit into the organization. So I think if people make a mistake, sometimes it's that they just try to hit the mark in terms of the qualifications, but they don't spend as much time trying to think through whether this person is going to be successful in this organization based on their personality, and kind of their affinity for how we operate and the cultural fit. So I'd say, you know, look at both hard. You can hire some great people, but if they're overly ambitious or political, and they don't play well with other people, they probably will flame out at some point because there will be a tissue rejection, if you will, at some point down the road.

Adam: And I think that that's applicable, regardless of the size of the organization you're leading. It could be a Fortune 500 company, or it could be a small business. If you have someone who doesn't fit your company, culturally, it's gonna be a disaster. And to that end, I wanted to know, if you could share with listeners, what you think about as the leader of such a large business, when it comes to managing your culture, what are the things that are top of mind for you, day in and day out?

Bruce: What's interesting, is when I first came aboard at Citizens, they had a credo that focused on the three C's; customers, colleagues, community and doing good across those three dimensions. You know, what I would say is the bar was set too low. So there was work that had to be done across what we could do for customers, what we could do for colleagues in terms of making it a great place to work and build a career and the impact we could have on communities. So I had to kind of reset and recalibrate the expectations higher. The other thing under foreign bank ownership to other C’s, I like to joke, crept in. One was comfort and one was complacency. So we had to get a bigger sense of urgency and accountability into our culture, which going public, or in the early days helped instill that we had to deliver, we added stakeholders to the three C's, so you're delivering for customer, colleagues, community, but then also for your shareholder. And if you're doing well with that it's not mutually exclusive; they all work well together. So I think we've really strengthened the culture, we've now tried to bring innovation as another aspect of our culture that is really, really important for a bank like us to be successful, longer term. And so we try to have a very core consistent culture where the bar is going up every year in terms of how we want to deliver. But then we bring these new things in, in terms of that sense of urgency and accountability. New innovation. And so your culture is something that is evolving. It's a living organism that you have to nurture and grow and take it in the right direction. But you can't stop and start. You have to basically have that core culture that I think you just build gradually. And it's second nature, people just love to say I love working here. I love the culture. I love the leadership. If you get all of that right out, you know, again, it helps propel you to be successful. One of the things, Adam, that we've done was we participated in something called the Organizational Health Index, which is something that McKinsey founded and over 1000 companies participate in this. But I wanted to benchmark us in the early days to find out where our health was as an organization. And not surprisingly, we were in the middle of the third quarter when I arrived. I spent a lot of time on leadership, on talent, on different aspects of culture. And this past year, we just moved all the way into the first courthouse. So it took us about five years, but we made steady progress each year. Because it's really, really important. And the studies show that the companies that get their culture that get their OHI score into the top quartile, outperform all their peers by a very wide margin for the next five years after they make it to that level. So we're looking for some good times ahead, based on that.

Adam: Bruce, you shared a lot of really important lessons there. And I want to highlight a couple for listeners. Firstly, the importance of self-reflection. You took a deep dive and realized that an area in which your organization was struggling was culture. And I think that all too often, we don't like to look in the mirror. And by virtue of you looking in the mirror, you were able to identify where you needed to improve. And number two, recognizing that improvement is incremental, Rome wasn't built in a day. And if you want to get to where you ultimately want to be, it might take you five years. But as long as you have a long-term plan and are committed to it, you will get there.

Bruce: I think that's extremely well said. I'm smiling, because you're almost like a fly on the wall. I've said Rome was not built in a day, I must have said that 100 times in the last five years. But you've got to have patience, but you have to have in mind the destination. What does good look like? What do we think this company needs to be in terms of its culture in terms of how it's delivering for its customers, and you set out on that journey? And of course, you'll need to make little tweaks and adjustments. But anyway, if you stay with it, the rewards will come.

Adam: You mentioned a couple of times that you were very focused on building a culture that emphasized and drove innovation. What are the keys to building a culture that fuels innovation?

Bruce: Well, I think it kind of starts with valuing folks' opinions and encouraging them to think differently. And think about where the puck is going, how the world is changing, and how we can do more and take advantage of some of those trends. You know, what's interesting is, we had a couple of folks that the young leader of consumerism was a real key instigator in us having some great success with innovation. We were one of the first banks to pioneer the student loan refinancing market, so we have a big market share there. We landed the Apple iPhone upgrade program. So we have a huge relationship with Apple, which we're now building on for Citizens Pay with other customers. And so having some early successes, innovation revs up the company and people see, well, this is great. But quite honestly, those successes were very narrowly driven by a couple of really great people that we have, and we weren't getting the contribution from the broader organization. So we hired a person to be our chief innovation officer, we kind of operate with a thin center-thick division model. And he built the infrastructure in place, set up the groups, set up some of the software that we could capture the ideas set up an innovation lab where we could have a shark tank capacity to fund ideas and short circuit that cumbersome technology process, we had our own little skinny technology crew who could get some of these ideas to market. So that's probably taken us two or three years to get the broader organization engaged and contributing these ideas. And we're funding some of these ideas. And this is the year of commercialization, I think we're really going to get a payback from three, four or five of these ideas coming out of the pipeline. So early success with a couple of massive wins, built on a narrow foundation, which now we're trying to broaden out.

Adam: Bruce, you've been a leader in the financial services industry during times good and times bad. And I wanted to see if you could share with listeners, what is your best advice on how to lead in times of crisis, uncertainty and change you've led through multiple major financial crises, and I'm sure you've experienced internal crises as well, in the companies that you've led. What advice can you share?

Bruce: Well, I think after a long career in financial services, which does have many ups and downs, both for the industry, the economy, and then your own company, if you've got to keep an even keel. So you can't get too high. When things are going well, you gotta be thinking about, you know, where are my downside risks? What could happen here that could upset this perfect trajectory we're on. And then you know, when things are rough, you need your best thinking, you need to stay upbeat. So the rest of the company can draw inspiration that, you know, we're going to get through this, we've been through tough times before, we need really to be sharp in terms of how we're addressing some of the issues that we're facing, but we'll get through it. And so you know, the old saying, it's always darkest just before the dawn- but having that attitude that, you know, we'll get back, things will come back, you just have to persevere, and work a little harder and be a little smarter and up your contribution a little bit. And we'll get through it. And so that's what I would say. It's not rocket science, it's just keeping that perspective and keeping that calmness under pressure, and not getting too giddy when things are going great and not getting too low. And things are really, really tough. It's kind of a life lesson too. That's why people should be, that's the way you should be as a leader in a company.

Adam: Bruce, I could not agree with you more. And I want to ask you about the other side of the coin, you lead citizens through the largest IPO in US history for a commercial bank, which was certainly a good time. What are your best tips on the topic of deal-making? And what are your best takeaways and lessons learned from that experience?

Bruce: I've been a part of many deals, acquisitions, divestitures- the IPO of Citizens was certainly a crowning accomplishment. But, you know, when you think about deals, they always have to flow out of the strategy. So what's the strategy? And if I'm looking at making an acquisition, does it help get you, I like to say, farther down the road faster, because you could always build things, but a lot of times that can cost a lot of money and take a long, long time, and not deliver certainty. Whereas if you can go buy something that is already well positioned, you know, does it make sense? Is it attractive financially? And is there a kind of the culture of the company that you want to acquire? Is it something that- just like when you're hiring leaders- is it something that fits, that's going to be able to plug in and work inside your company? So you know, that's kind of a general rule around making sure when you're doing acquisitions or divestitures, it's true to your strategy, and you can explain it to your stakeholders. The IPO itself really was an opportunity. We knew that RBS had to divest Citizens, and we had a clock ticking on it. So they had to be out of the stock within three years. They said we should IPO within a year and a half, we actually brought that in and IPO within one year. And we had them completely out of the stock by two years. And this relates to - I won't bore you - but there's EU rules around companies that took a bailout in state aid in Europe that forces the company to then divest and simplify and get smaller. So we got kind of caught up in that. And RBS had to divest Citizens- what we focused on and telling the story to investors, we were kind of limping along as an [inaudible] of a foreign bank that had a low return on equity. But I had assembled a good team and we had good raw material. And we had a plan, we said, within three years, we can take a 5% return on equity bank to 10%. And if we keep doing what we think we can do, we can get that number back up. So we'll be kind of easily back within where our peers are. So we benchmarked ourselves against our peers. We put out a plan very discreetly with a lot of transparency. And people thought we were credible. So we were able to get three, three and a half billion placed in the IPO and then ultimately got 12 billion as RBS sold off the rest of their stakes. And then we went out and executed. We just delivered what we said we would do. And it was a very good success story. And the people who bought the stock when it was IPO at 21- the stocks at 47 right now so not a bad return over a seven-year period plus a healthy dividend to boot. Not bad. The math works.

Adam: You can't argue with the numbers. Can you talk about your daily routine? What do you do every day as the CEO of a Fortune 500 company? What are the keys to succeeding day in and day out?

Bruce: Well, I think it's really important to be out and about. And so the one thing that I miss the most, in this pandemic era is, you know, we don't have all our people back in the office. And so I don't travel as much as I used to, but I used to be in three or four cities a week, meeting with our colleagues, or having town hall meetings or going to visit customers or community partners. And so there's been less of that and more meetings, I would say, and zoom meetings and the like, which has been okay, so we've been able to function, but we're now going to see people start to come back in bigger quantities, which means that I can get out and about again. So to me, a leader needs to be visible. We're not all in one building, where you can walk around the floors. We're actually spread out geographically. And so that means I have to move around a bit if I want to see my people. And so you know, you've got to have stamina, you've got to keep yourself in shape. You've got to be able to rest well at night, work hard, play hard, you know, have some hobbies, get exercise, play some sports, do some things to try to keep yourself in balance. I've always talked about the three F's to people: faith, family, and friends. And those to me are things that really, you need to tend to, you need to be strong in those dimensions in order to have a successful and happy life. So I try to stay in balance. And I look forward to the opportunity to get out and about again.

Adam: Bruce, what can anyone listening to this conversation do to become more successful personally and more successful professionally?

Bruce: Well, I'd say number one is to be a positive person. So I think, you know, just staying positive, setting goals for yourself, being willing to take on new challenges and new responsibilities, to push yourself a little bit- don't be complacent- and then go out and work really hard. To me that's the secret to being a successful, happy person is to kind of really, work hard and set goals and stay positive, and you'll meet some defeats, but have the confidence that you'll be able to figure out how to overcome those defeats, and they were just a learning experience. And you'll continue to propel yourself on to bigger and better things. It's just a mindset.

Adam: Was there an experience in your career that you could share with listeners that really helped shape your character, an obstacle that you had to overcome, that made you the leader that you are today?

Bruce: You know, I'd say one was when I was at the bank in New York, and we had on and off, flirted with Mellon Bank to try to do a merger. And the third time, the third flirtation, we actually were able to get that done. And, you know, there were two folks just below the CEO, myself and the President. I was vice-chairman and CFO and had some businesses reporting to me. And the CEO came in and said, you know, if we're going to get this deal done, we have to give this CEO over to the Mellon side. So both you guys, I've got to sell you down the river, and I'll take care of you, but you won't be the next CEO of the bank. And we both looked at them and said, you know what, it's the right thing for the bank to do this deal. And, you know, yeah, make sure you take care of us, but we'll give it 110%. So, interestingly, I stayed for a couple of years to make sure it went well. I was taken care of financially, but you take the old thing in The Sound of Music, Julie, Andrew said, when God closes a door, he opens a window somewhere else, you know? That led to my opportunity to go to RBS and fix RBS, which owns Citizens, which now gave me the chance to be a CEO. So it kind of worked out. So you know, I didn't get down when that happened. That was my dream was to sit in the CEO chair there and it wasn't that CEO chair but it became another CEO chair. And interestingly, the other fellow Gerald Pasal ultimately outlasted the person from Mellon and we put in the job and Gerald ended up being the CEO so he got his chance to be the CEO as well by sticking around and not leaving for another opportunity. So anyway, things tend to work out. You just need to stay positive and say, you know, you're not always going to go on a straight line in life, you're gonna hit kind of forks in the road that might take you in a different direction, but if you're a good person, and you have confidence in yourself, make sure you get resituated into something that plays to your strengths, and you'll continue to be successful.

Adam: We were chatting off the air before the podcast and one of the things that you had mentioned was the fact that I've interviewed more than 500 of America's top leaders. And if there's one theme that has emerged, it's that there is no linear path to success. And, yeah, you've clearly told a story that I think all listeners can relate to. And I wanted to thank you for all the great advice and thank you for being a part of Thirty Minute Mentors.

Bruce: Okay, Adam, it's been a real pleasure. Nice to chat with you.

Adam: Pleasure was mine.

Adam Mendler is the CEO of The Veloz Group, where he co-founded and oversees ventures across a wide variety of industries. Adam is also the creator and host of the business and leadership podcast Thirty Minute Mentors, where he goes one on one with America's most successful people - Fortune 500 CEOs, founders of household name companies, Hall of Fame and Olympic gold medal winning athletes, political and military leaders - for intimate half-hour conversations each week. Adam has written extensively on leadership, management, entrepreneurship, marketing and sales, having authored over 70 articles published in major media outlets including Forbes, Inc. and HuffPost, and has conducted more than 500 one on one interviews with America’s top leaders through his collective media projects. A top leadership speaker, Adam draws upon his insights building and leading businesses and interviewing hundreds of America's top leaders as a top keynote speaker to businesses, universities and non-profit organizations.

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