Bank of America 2003 Annual Report Download - page 3

We have been successful with this approach for sever-
al reasons. We committed to Six Sigma 100% from the
beginning, made no exceptions and insisted that the
result would be a fundamental and permanent change in
the way we operate the company. We hired accomplished
veterans from outside the company to accelerate results
and aggressively trained our own associates in the disci-
pline. We pursue new metrics to gauge the impact of our
work, and we hold individuals accountable for results.
Those results are impressive. Since launching our Six
Sigma efforts less than three years ago, we’ve saved hun-
dreds of millions of dollars in expenses, cut cycle times in
numerous areas of the company by half or more and
improved the percentage of customers who rate their satis-
faction at 9 or 10 on a 10-point scale from 41% to more than
50%, an increase of almost 2.5 million customers.
From a growth perspective, the benefits are clear. The
cost savings and efficiency gains are immediately avail-
able to be redeployed in growth opportunities in the market,
and improved customer satisfaction leads to increased
revenue that also can be directed to growth opportunities.
We are investing in these opportunities aggressively in all
our businesses, from Consumer and Commercial
Banking, to Asset Management, to Global Corporate and
Investment Banking.
You can read about some of our initiatives and
the results we are achieving in the stories that follow this
letter. What these stories demonstrate is that better, more
efficient, more consistent processes lead to better prod-
ucts and services, more satisfied customers and clients,
more revenue and net income, and, finally, stronger
returns for shareholders. The numbers are in, and the
conclusion is clear: Our strategy is working.
Winning the right way. A commitment to winning is a
strong part of our corporate culture. An equally strong
part of our culture is a commitment to winning the right
way or, as we sometimes say, “doing the right thing.”
Last fall, our company was named in a regulatory
inquiry into practices within the mutual fund industry. In
an effort to protect our customers and shareholders, and
resolve the situation as quickly as possible, we immedi-
ately took the following steps:
■We launched our own internal inquiry;
■We announced that we will make appropriate
restitution to shareholders of any funds that are
found to have been adversely impacted;
■The Nations Funds board of trustees announced the
appointment of independent individuals and firms to
determine any monetary impact on the funds; and,
■We dismissed several associates from the company.
We run our company with strict adherence to fact-based
principles of management, in which all individuals are held
accountable for their decisions and their actions. I wrote at
length last year about the confidence we have in our gover-
nance and risk management systems and processes. I con-
tinue to believe our governance systems are among the best
in the world, even as we work every day to strengthen them.
We will continue to do whatever is necessary to main-
tain and build the trust and confidence of our customers,
associates and shareholders. If we find something wrong,
we’ll fix it and be better for it. In the final analysis,
I believe we will be judged not by the actions of a few of
our associates, but rather by the way we responded as
a team to a violation of our shared values. We have no
tolerance for decisions or actions that fail to put the
interests of our customers, associates and shareholders
first. Our actions will reflect this stance in the future, just
as they have in the past.
New teammates, new opportunities. On October 27,
2003, Chad Gifford, chairman and CEO of FleetBoston
Financial, and I announced our agreement to merge our
companies. We also announced that Chad will be the
chairman of the board in our new company, while I will
retain the role of chief executive officer.
This combination of two of the oldest and most
successful companies in U.S. banking presents us with a
unique opportunity. With this merger, we are creating
unrivaled distribution in America’s best growth and wealth
markets. We will offer global reach through offices in 35
countries, with particular strength in Europe, Latin
America and the Pacific Rim.
Our company will feature increased earnings and
revenue diversity, creating stronger, more consistent
results for shareholders. It will create enhanced leverage
of our technology and process capabilities, as well as
investments like national advertising and research and
development. The company will have broader distribution
of wealth management products. And the management
team will be the best in the industry.
All that said, in my mind one of the most compelling
arguments for this merger is our vision for a truly
national bank that creates the opportunity for Americans
across the country to choose the unprecedented conven-
ience, quality and innovation we can provide.
Ultimately, this merger is about delivering the
combined capabilities of two powerful organizations to our
2BANK OF AMERICA 2003 BANK OF AMERICA 2003 3
Ken Lewis presides over the Risk and Capital Committee, composed of the company’s most senior executives. Ken Lewis addresses a gathering of the company’s leaders (left) and works with the Risk and Capital Committee (right).