Citibank: Performance Evaluation

Categories: BankBusiness

The California Division of Citibank has introduced a new performance scorecard to highlight the importance of a diverse set of measures in achieving the strategic goals of the division. Among the new measures introduced was a customer satisfaction indicator. Unfortunately, James McGaran, the manager of the most important branch and who consistently delivers impressive financial results scored “below par” on customer satisfaction. Frits Seeger, President of Citibank California and Lisa Johnson, area manager supervising James, are pondering what overall performance rating are they going to give to James.

Areas of ConsiderationCitibank’s strategy in California was to build a profitable franchise providing relationship banking combined with ah high level of service to its customers. Financial measures had dominated Citibank’s performance in the past but management felt that these measures were poor vehicles to communicate the high service strategy of the bank. Other areas to consider in this case are:

•To reflect the importance of non-financial measures as leading indicators of strategy implementation, the California Division developed a Performance Scorecard which complemented existing financial measures with new measures reflecting important competitive dimensions in the bank’s strategy.

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•James’ customers in his branch are sophisticated- they require high service quality and knowledgeable employees who could satisfy their financial needs and his performance exceeded expectations every single year by delivering impressive financial results for four years in a row.

•But when the division expanded its performance indicators to include non-financial measures, it became apparent that his branch’s customer satisfaction ratings are not as good as his financial performance.

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His customer satisfaction was “below par” for 2 consecutive quarters.

•James discussed concerns regarding the (in)adequacy of the survey: customers rated not only their branch but also other Citibank’s services such as ATMs that were out of the control of branch managers.

•Even so, he worked hard to improve the customer satisfaction rating by designating a staff to greet customers and held meetings and coached branch employees to focus their attention on improving customer satisfaction.

•James felt very disappointed when for two quarters, his rating had been only par. He thought that his efforts deserved an above par rating considering that he’s able to successfully run the hardest branch in the division.

•Frits is considering to give James an “above par” rating given his excellent performance in other dimensions, but if the performance evaluation team gave James an “above par,” the other managers could think that the division was not serious about its non-financial measures.

Alternate Courses of Action•Set aside the performance evaluation guidelines and give James an overall “above par” rating thus entitling him to as much as 30% bonus.

•Observe and uphold the performance guidelines and give James an overall “par” rating and get a bonus of up to 15% of basic salary.

RecommendationsI recommend that the evaluating team follow the guidelines they set forth and give James the following ratings:

•Financials – Above par•Strategy implementation – Above par•Customer satisfaction – Below par•Control – Above par

•People – Above par

•Standards – Above ParJames’ average in customer satisfaction for the four quarters was a dismal 64.75 – a far cry from the required market average of 77 to get “above par” and about 10 points shy from the 74-79 score to get a “par” rating. Based on the guidelines, with a “below par” rating, James is no longer qualified to get an overall “above par” rating and thus settle for a “par” rating. This is to give credibility to the intent of the management in implementing a balanced scorecard and in giving other factors equal weight and importance as that of financials.

Having said that, some important issues need to be addressed in Citibank’ performance evaluation. First, Lisa should have provided support to James as early as the 2nd quarter when his customer satisfaction scores began to slip from 66 to 63 (then further down to 54 during the 3rd quarter). Performance evaluation should not be a static document- it should be a reference for the employee and superior to identify deficiencies and gaps during the rating period. It should be revisited regularly, identify areas of improvement and see how management can intervene and improve the performance of the manager. A regular performance feedback is crucial so that the managers can align their activities with what is expected of them.

Second, it would be worthwhile for Frits and Lisa to review the scores of the other managers focusing on customer satisfaction- this is to find out how all the managers are faring with the new performance indicator and to determine James’ performance vis-à-vis his colleagues. If the general results of the customer satisfaction are similar with that of James, then his concerns are not unfounded- it may be that while the branches are doing their best in extending excellent customer service, the centralized services might be the one that’s pulling down everyone’s performance.

Third, it would be excellent if Frits can benchmark their performance evaluation with the rest of the industry and see if their parameters in especially on customer satisfaction are within industry standards.

Fourth, a reorientation or training on the proper administration and use of the performance evaluation is in order. Based on the scores and comments that Lisa gives to James, it appears that she is lenient with him. She overemphasizes James’ financial achievements but mentions too little on his deficiency on customer satisfaction. There also seems to be a halo error in the way Lisa evaluates James- where his financial prowess seems to unduly influence the other evaluation dimensions.

  • Imons, R. Citibank: Performance Evaluation. 1997. Harvard Business School

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Citibank: Performance Evaluation. (2016, Jul 27). Retrieved from

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