Spotlight on Weber Lo: Keep Pace with the Times

In this episode of the televised programme “Talking to CEOs” on Radio Television Hong Kong, hosted by Prof. Andrew Chi-fai Chan, Director of CUHK Business School’s Executive MBA Programme, Weber WP Lo, Citi Country Officer and CEO of Citi Hong Kong and Macau, shares his early experience in the fast-moving consumer goods industry and how he switched into the banking sector and led the team through past and current challenges.

Q: You had been a P&G summer vacation intern before you graduated from the university. At that time, the P&G only recruited 3 interns. Those multi-national companies always prefer top-notch students. As a handball student athlete with ordinary academic performance, how did you stand out and get the opportunity?

A: That was in 1992, when the P&G just started their second term of summer vacation internship in Hong Kong. I signed it up, but didn’t expect to get the offer.

There were five rounds of interviews. In one of the interviews, the interviewer asked me directly: “All your classmates have better GPA than you. Why should I choose you?” Then I talked a lot about my experiences in sports and how I handled the issues I faced academically with the spirit I had learned from sports. Probably, the interviewer found that my examples were very real and I was capable to solve different problems using what I had learnt, therefore accepting me into the fourth round.

In the fourth round, we were led by a sales and marketing manager who promoted the company products. Since I frequently participated in sports activities, I had no problem with teamwork at all. Eventually I got recruited. At that time, I learnt that although academic performance is important in interviews, one’s ability in solving problems is also very much appreciated.

Q: Upon graduation, you officially became an employee in P&G. But after working there for several years, you were headhunted to work for Coca-Cola in 1997. What made you make such a decision?

A: I had good memories and opportunities in P&G. I had been promoted as a brand manager only after two years I joined the company, but I was eager to learn new things and enrich my life experience.

Coca-Cola is a well-known brand, but that’s not my reason to change jobs. The real attraction was the chances they offered for me to get to know the Chinese market, which was an exciting thing at the time.

Q: During the years in mainland China, was there any impressive experience?

A: I remember there was a time when we were promoting a new brand called “Smart”(醒目). The “Smart Watermelon Soda” was selling well in some cities such as Beijing and Tianjin, but very badly in Nanning.

My colleagues gave many reasons for the failure in Nanning. But I didn’t find out the real reason until I went there–we sold a bottle of “Smart Watermelon Soda” at 1.5 RMB but a watermelon in Beijing costed 6 RMB, whereas in Nanning, it only costed 1 RMB. Obviously, unlike in Beijing, people in Nanning would choose a watermelon over our Soda.

The experience told us that we have to personally go to the market to find out our customers’ needs. Only in this way can we find out what the real problems are and how to remedy the problems.

Q: You’ve always been in the market frontier and it only tookyou three years toget promoted to the senior management in Coca-Cola China. But you suddenly came back to Hong Kong in 2000. Why?

A: An IT venture capital fund invited me to join at the time. I thought I was young enough to give it a shot, and my friend also advised that I shouldn’t miss the opportunity. But two months later, I found that it’s not my interest, so I quitted eventually.

Before, I would get to know my customers’ needs first and then tried to design products to satisfy them. But this way of doing things doesn’t work in the IT industry where there are no needs but only concepts, and what you do is finding capital to back up the concepts. Hence, the job did not really suit me at all.

Luckily, a friend in the banking industry asked me whether I was interested in joining their field. When I asked which bank it was, he said it was the Citibank.

Q: During the SARS period in 2003, your career faced a huge crisis. What lessons have you learned from that period of time?

A: In 2002, I was transferred to the credit card department, and I was ready to show my talents there. However, when the SARS hit Hong Kong the following year, the sharp decline in property prices made a lot of people go bankrupt. As a result, the credit card business in Hong Kong was severely affected since people who filed for bankruptcy didn’t need to pay their credit card debts anymore. We called it “sudden death”.

So at that time, my objective had shifted from increasing market shares to saving the loss for the bank. Once we issued the credit cards, we couldn’t collect them back. In such circumstance, what we could do was to cut the cost, changing the strategy from offensive to defensive.

That period was very difficult. But I had learned something important: Defense strategies are as important as offensive strategies when doing business. We shouldn’t only focus on winning new clients, but also need to manage the current ones.

Q: As Citibank’s Country Business Manager for Hong Kong and Macau in 2007, you were in charge of Citibank’s consumer banking operations in Hong Kong and Macau. But in a short while, the Lehman Brothers filed for bankruptcy. What was your biggest anxiety at that time?

A: In fact, the collapse of Lehman caused more problems than SARS for the whole banking industry, including Citibank. Our company held lots of Lehman’s notes, so when Lehman was bankrupt, our stock price dropped to less than one dollar. We were worried that our clients would lose confidence in us and thus leave us. Actually, many clients had called me to see if the Citibank would survive in the crisis, which made me feel really stressed.

Afterwards, our clients knew that the Lehman notes they held became worthless and many of them marched into the streets to protest. If you were close to Citibank Tower in Central at that time, you would notice that there were demonstrators who were flying flags, clashing cymbals, scrawling and trampling upon images of my pictures every day. During that period, I barely dared to set my foot in Central.

Moreover, I had to face investigations from the Hong Kong authority, and attend a three-day question-and-answer session in the Legislative Council. The whole process was broadcasted on TV. Every word I said had to be previewed by my lawyer first, because my words represented the whole firm. Every mistake I made in the Legislative Council might cause a huge loss to the company. That pressure was unprecedented for me.

Nevertheless, Citibank is a customer-oriented company. So we were keen to solve the problem for our customers. I asked our staff to prepare triple times the usual amount of cash in their counters, so that every client could withdraw their money. Otherwise, they would think “the bank was running out of money.” I also asked them to put enough cash into our ATMs. The number of cash supply increased from once per day to twice per day. So we tried many ways to restrain the panic.

Fortunately, as the US government took action quickly and Hong Kong Monetary Authority announced to provide up to HK$500,000 for deposit protection, the market finally calmed down.

Q: Due to the Lehman case, the whole banking industry is reshuffled. Compared to before, is there any difference in Citibank’s positioning?

A: Since then, we started to target the middle class market. Within two years, our branch number was increased from 18 to 50. Actually, the market size of middle class is as large as that of the top class market. But for middle class clients, we need to put more efforts into increasing the market share. Although Citibank comes from the US, we hope to localise it and develop products for Hong Kong people. This is our positioning.

Of course, we need to know our future direction as well. Currently, globalisation, urbanisation and digitisation are the three mega trends in today’s world. So we have to develop products and services that adapt to these trends.

Hong Kong is an ideal place to practice the above trends, so we are expected to develop more products to satisfy our customers’ needs in regard to these three aspects. The company will continue to invest a lot of money in the city.

Q: Speaking of digitalisation, the US and China have made huge progress in financial technology (FinTech) in recent years. How do you see the threats it brings to the traditional banking industry?

A: The FinTech products such as Alipay have indeed brought a huge threat to the traditional banking industry. It is very convenient and easily accessible to young people who would probably prefer financial management services via the internet or mobile phone rather than going to the bank counters.

In that sense, we try our best to digitalise and simplify our services by, for example, reducing paperwork and cutting unnecessary procedures. The new generation has little patience and dislike waiting. It would be unacceptable for them to wait for two days or even longer to get a credit card. Instead, they want to get a card immediately. So we have to speed up the procedures.

FinTech does affect us a lot due to changing consumer habits of the new generation. Therefore, for banks, we have to keep pace with the times, and constantly reinvent our products and streamline our services. Otherwise, we won’t be able to compete in the market.

Translated by Liu Xin, PhD candidate, School of Accountancy, CUHK Business School. Abridged by Fang Ying
This article was first published in the China Business Knowledge (CBK) website of CUHK Business School.