On Monday, October 6th, 2008, TV screens across Iceland went black, with the words "God Bless Iceland" appearing in white on the screen, like a funeral announcement. The Prime Minister gave a speech to his country, letting them know that their banks had collapsed, the government was taking control of the banks, and that it would pass legislation to prevent the economy from total collapse.
Many had lost all of their savings. Many had lost their jobs. Icelanders took to the streets in protest, throwing rocks at the parliament buildings amidst chants of "resign!" Within the next year, the Prime Minister and the CEOs of all 3 major banks were indicted on over 200 criminal charges.
Not, for most, the ideal time to enter the banking sector. For Steinthor Palsson, who had chosen to leave the industry years before when the merger of two banks created a culture that did not align with his personal vision, it was time to get back to work. Steinthor felt it was his duty. He took a pay cut, worked incredibly long hours, and faced threats of violence to help rebuild the nation he loves.
Steinthor took the stage at Ivey's BMO Theatre recently to share with us his role in the rebuilding of the Icelandic economy.
Throughout the hour or so that Steinthor spoke it became apparent that he knew in order to rebuild the badly damaged brand he needed to build trust, and that trust began with him as an individual. He was going to have to live the new Landsbankinn brand and prove to his customers that he embodied the future the bank needed. It was his personal commitment to change as an individual who would lead the new banking industry in Iceland.
It was time to bring a new vision to Landsbankinn - Listen, Learn, Serve.
Listen
Steinthor really took this on to the Nth degree. He listened. And listened more. And then took his listening show on the road, quite literally.
He started with his employees. The collapse of the financial industry had devastated Iceland. Many lost their homes, their jobs, all their life savings. Understandably, this led them to vent their frustration at any banker they encountered. Many bank employees stopped attending social functions, even with family. Morale was beyond low. Steinthor referred to the employees as "broken". He invited them to talk, and he listened. To everyone, at all levels. Every employee of every branch of Landsbankinn attended meetings with their new CEO and voiced their opinions. Even as they were reviled by the Icelandic people as crooks who caused the collapse, many of the employees had lost their life savings as well. Their distrust of their own employers was the first rift that Steinthor must mend if he were ever to gain the trust of the public.
After weeks of meetings with all the bank employees, Steinthor and the Landsbankinn management team took out a two page ad in Iceland's newspapers listing 28 promises they were making to their customers and their country. They were bold and specific, and held the bank accountable for their actions over the next few weeks. Again, Steinthor knew he needed to start by listening.
He travelled across Iceland, holding open forums for the public to come and share their own experiences with the banking industry and the financial collapse. Again and again, he personally faced them as they shouted, cried, blamed him. He sympathized. He truly heard them. And after each person in each crowd had had their chance at the microphone, he ended the meeting by inviting everyone to join him for coffee and cakes and further discussion.
During these meetings, both with employees and the public, Steinthor asked not only for suggestions for how Landsbankinn could improve, he also asked "what can I do personally?" Considering he was not working in the banking sector before he took over as CEO in 2010, this sense of responsibility was incredible. It also demonstrated to both bank employees and customers that he was holding himself personally accountable. Through standing up in front of the public, he got his team behind him.
Oh, did I not mention the fact that once he assumed the CEO position, he had to travel to work and back with a guard? When Steinthor said he would travel the country to host these meetings, they thought he was being reckless. When he said he was also going to attend the informal coffee meetings afterwards to meet his customers face to face, they were concerned he may have a death wish. Yet he stuck to what he knew to be true- first and foremost, people want to be listened to.
Learn
Now that he had listened to everyone- his employees, the companies they served, and every member of the Icelandic public that he could convince to speak to him- Steinthor began to respond. He said that the second step to building trust is to surprise and take action- in short, demonstrate that you've listened and learned.
His research revealed that there was a deep distrust for the management of the banks, both from the bank employees and his customers. Steinthor created open job postings for every management position in Landsbankinn, and posted these jobs internally and through the Icelandic media, to the surprise of all.
Far from creating a sense of distrust or insecurity in his staff, it helped build their self-confidence. Steinthor was demonstrating, very publicly, that his team was the best in Iceland. It was a challenge to the rest of Iceland, who claimed that they could do better.
After he had his team in place, Landsbankinn took out another two page ad in the newspapers to follow up on his 28 promises. The ad showed exactly how they had addressed each of the initial promises. Once again this move surprised the public, who was not used to such transparency and accountability from their banks.
Serve
Now that he had worked hard to listen to his team and the public, and rebuild the management team for Landsbankinn, it was time to start serving the public. In response to the public backlash, Landsbankinn sold off assets that had a negative perception. Steinthor created a customer focused strategy, and capped growth for the bank. He felt it was necessary to prove that supporting individual customers was more important than the bank making money.
Consider that for a moment...a CEO- of a bank, nonetheless- caps potential profits to build trust and serve his customers. That's servant leadership type talk right there...from a banker.
Steinthor's commitment to rebuilding the broken industry is nothing short of astonishing. He lives out the bank's mantra of "listen, learn, and serve" through his strategy and execution. Watching him speak, it was very clear that he loves his country and respects his coworkers. Again and again he came back to the morale of the employees when he took over, recounting their personal tales of loss and depression. There was no question in his mind- duty called, and he answered. Steinthor Palsson has proven that he is truly a leader of great character, competencies, and commitment.
About the Author
Equal parts thinker, tinkerer, science geek, and marketer/sales pro, Rebecca can be found travelling the world as a rep for Ivey Publishing. In her spare time she's also a vinyl junkie, drinker of fine drinks, and voracious reader. Google+ TwitterLinkedIn Blog