Two phrases captured the priorities at Hawthorne Savings in the last decade of the 20th century—“Save the Bank!” and “Manage the Bank!”

Hawthorne was established 50 years ago, after World War II, as a community bank to help finance housing development in the South Bay area of Los Angeles. Because of its close links to the local communities and economies, Hawthorne suffered when the Southern California real estate, defense, and aerospace industries collapsed.

Cindi Morales, Senior Vice President of Human Resources, remembers those difficult years. “It was a time when we didn’t know whether or not we’d have a job in six months.”

“People were hired,” she says, “to save the bank, and when that was accomplished they discovered they needed a different skill set to manage the bank.”

Hawthorne looked to The Ken Blanchard Companies^® to put something in place for executives to help them master the skills needed.

“Blanchard values matched what we were striving for and we wanted help from an organization that knows how to do things right,” Morales says.

Executive Vice President Dave Hardin, who Morales describes as the heart and soul of Hawthorne Savings, had heard Ken Blanchard speak and asked Morales to investigate the possibilities.

Thus began a relationship between the father and son team of Dev and Wayne Ogle of The Ken Blanchard Companies and the senior management team at Hawthorne.

The results today are evidence of the success that has been achieved.

Infusing Values

From a strategic planning process evolved four strong value statements that serve as the core of Hawthorne’s Leading Through Values management training program: People Count. Extreme Service. Dare to be Different. Work Hard. Play Hard. Have Fun.

“Human Resources was responsible for the rollout of the re-crafted value statements to all of our employees,” Morales explains, “and wanted them to be very visual.”

This mission was accomplished by having special hot beverage tumblers designed featuring the words the company wanted to live by. “All employees found tumblers on their desks when they returned to work from the holiday break to begin the year 2000,” Morales recalls with a satisfied smile in her voice.

“It certainly wasn’t enough to announce the words,” she says. “Senior management wanted to assure that they were changing the culture to match.”

To measure the pulse of their employees, The Ken Blanchard Companies and the Ogles designed an electronic survey that is conducted each quarter asking questions such as “Do you have the right resources to do your job?” or “Does your manager care about you as a person?” These questions test the “people count” value.

“We want to know if our employees believe the managers are walking their talk,” Morales says, obviously happy to report a stronger response each time the survey has been conducted this year.

Reducing Employee Turnover

At the height of Hawthorne Savings’ crisis period, employee turnover was 100 percent. “You can’t get much worse than that,” Morales agrees. And with the training programs offered by The Ken Blanchard Companies, Hawthorne is beginning to meet its employee retention goals.

In 1999, Hawthorne’s employee turnover was 35 percent as compared with a 17–26 percent turnover in the banking industry when measuring companies of comparable size. Hawthorne averages 275 full-time equivalent employees.

Hawthorne’s Traditions program, designed as an employee orientation for Hawthorne with input from The Ken Blanchard Companies, brings senior management together with all newly hired employees.

The Executive Vice President talks about the company’s history; the Chief Executive Officer talks about finances; and the session concludes with the Fish! video, which is based on highly motivated employees, having fun and doing terrific work at a fish market in Seattle.

Delivering Extreme Service

In an industry marked by “bigness” attained through mergers and acquisition, Hawthorne prides itself on knowing each customer’s personal needs. Rather than being a small player in many markets, Hawthorne has achieved its objective of holding a prominent position in the market it serves.

To help keep its frontline employees attuned to its value of Extreme Service, Hawthorne offers The Ken Blanchard Companies’ Raving Fans^® program. “Our people really enjoy it,” Morales says, “and they take it to heart.”

She likes to tell the story of the bank teller who found that a customer had mistakenly sent a mortgage payment to Hawthorne that belonged elsewhere. “When our teller discovered her customer’s error, she drove the payment to the appropriate competitor and delivered it personally.”

Forging Forward

The company has moved beyond those “Save the Bank; Manage the Bank” years to realize substantial and growing operating profitability. It has increased its assets from $750 million to $1.7 billion. Its stock price has climbed from a $3–$5 range to a $12–$20 range.

Strategic planning, management leading by values, and employees delivering extreme service, have allowed Hawthorne Savings to position itself to forge toward its goal in this 21st century of being known as the “best bank ever.”