Thursday, March 21, 2013

New Automation Tools Yield Quick Rewards for Community Banks and Credit Unions Looking to Cut Costs and Improve Efficiency

If it’s been a while since you looked at tools to help automate some of your back office processes, now is definitely the time. There are some great tools available to support automation and the results are better and faster than ever.

At Quest, we’ve been busy over the last year working with customers to automate a variety of back office processes. The end result is that it frees up IT or other bank staff of manual and time consuming back office duties to focus on more knowledge-based tasks. Most of our clients are surprised to see how much time is really spent over a year by their staff in performing routine back office processes that, in the end, should really be automated. In this age of narrowing margins and cost cutting, even small automation projects pay for themselves in time savings.

A recent article in McKinsey Quarterly noted that “IT-enabling operations encompasses both automating processes (preventing customers from using paper, digitizing work flows, and automating or supporting decision making) and using IT solutions to manage residual operations that must be carried out manually (for example, using software for resource planning). By taking full advantage of this approach, banks can often generate an improvement of more than 50 percent in productivity and customer service.” (McKinsey Article)

Back office processes tend to, over time, become very inefficient and prone to error. Many banks who take the time to analyze these processes learn that they no longer even need these processes or that they can and should be combined with other processes. The buzzword for this type of activity is business process reengineering, but it is really taking a close look at the purpose of each process and how effective it is at achieving its goal. McKinsey Quarterly researched bank back office processes and found that “more than 70 percent of the applications were paper based, and of those, 30 to 40 percent contained errors and required reworking; applications often got stuck in one data-verification step for more than five days before being processed; and because of a lack of any IT integration, branch and back-office staff had to enter data manually from several systems into the work flow.” (McKinsey Article) At Quest, we have had a similar set of findings in the customers we support. Even the simplest processs can be set up to increase the quality of data in your systems as discussed in a previous posting.

By combining a thorough analysis of back office processes with an agile approach to automation, banks are recognizing quick returns. The agile methodology is designed to break projects into small parts that can be completed in a short time period. This is the new approach for automation projects because of its results-oriented focus, rather than the historically long development timeframes most people associate with system development. This is what allows quick returns for a bank. However, the key to success lies in the completeness of the business process analysis and reengineering and the bank’s ability to look beyond the current process and focus on the overall goal of the process.

Thursday, March 14, 2013

Community Bank and Credit Union Branch Performance Metrics Lead to Consistent Success

What are your goals for 2013? Most banks set them, but do you have a way to track your progress toward meeting those goals? Quest Analytics works with dozens of banks in analyzing and measuring progress toward goals in a wide variety of performance measurements. So, now that we are over one month into the new year, what are you tracking in 2013? Do these measurements support the larger goals of your bank, or in consultant-speak, are they aligned?

Progress towards your goals should be measured throughout the organization. So, for example, if a push is on for new customers, then your branches should be measured on new customers also. However, finding the right way to fine tune your performance goals to more manageable goals at the branch or even officer level can be tricky.

Most institutions still use a traditional set of performance measures including number of households or customers, number of accounts, average number of services per household or customer, total balances, average balances, fee revenue, profitability, etc. Not all core vendors make tracking and reporting on your metrics easy. Many institutions use data warehouses coupled with business intelligence or reporting tools, or even MCIF or other systems to help them track, report, and manage progress on their measures. What is the accuracy of these measurements? The truth is, in general, you are really looking at trends so the exact numbers are somewhat less important than the trend. However, incentive plans often are tied to these measures so the measurement itself is still important.

The most important thing about the measurement is that it must be made consistently over the measurement period so that trending can be monitored. This is the only way that trends can be meaningful. You must have a baseline or starting value for each performance measure to compare progress against. This means you should have setup and tested your reports and measuring processes prior to the start of your measurement period. If you have not, though, you are not alone. It is not unusual to see institutions continuing to adjust what they measure and their target goals throughout a year or other measurement period. This makes it very difficult to see progress, but is often caused by changing bank priorities or changes in executive leadership.

What is important is an enterprise-wide understanding of the overall goals and how the goals of each branch, sales team, and individual employee contribute to meeting them. This is the aligning of goals throughout your organization. For example, say your bank had a goal to increase total loan balance by a certain percentage. Then, each branch should have goals for increasing their loan percentages as well. In addition, loan officers should also have goals to increase loan balances across all of their relationships and other staff should have goals for making loan referrals. It is here where expectations for performance levels are set. Employees should be rewarded for performing beyond expectations, not for meeting them.

This scenario is only possible when the entire organization has the same vision and is directed by strong leadership from the top down. There is great power in having everyone understand their own personal role in helping the organization meet its goals by meeting their own goals. Many employees believe their goals are haphazard and, as such, they do not feel driven to meet those goals because they can’t see the larger connection or understand the reasoning behind them. By ensuring that everyone understands their role in the larger program, they feel part of the organization’s mission for the year.

The second part is that the goals must be easy to understand and each individual should be able to understand the calculations used for measurement. The goals must also be reasonable since they set a bar for the expected level of performance. If employees believe that a goal in unachievable, they may not even attempt to reach it, thus defeating the purpose.

Banks and credit unions should always include measures that consider customer acquisition, relationship expansion or cross-sell, and retention. Branches, officers and other employees all have a role in helping a bank meet goals in these areas. For acquisition, consider the number of new customers or new accounts at a branch perhaps even broken out by type (e.g., checking, line of credit, loan, etc.). When measuring relationship expansion, many banks will compute an average number of services per customer or household while others simply use the number of new products sold to existing customers. Retention can be measured by looking at the number of customers who close their last active account, or the number of transactional accounts closed so that loans and time deposits are not included. There are many ways to measure, but the key is to make sure everyone is focused on gaining new customers and retaining and expanding relationships with existing customers. Examples include increasing teller referrals and actively pursuing all sales leads.

Many organizations know exactly what they need or want to measure, but struggle with how measure or report on those items. Quest Analytics’ team has over fifteen years of experience working with banks and credit unions in this area. Our consultants have created automated reporting solutions for dozens of clients using multiple databases and reporting systems. We have also helped many of our clients define the types of items to measure as well. Contact us if we can help you establish or refine a key performance indicator solution for your institution.

Tuesday, March 12, 2013

Community Banks and Credit Unions Find Positive Attitude Leads to Relationship Building Success and Increased Sales

All the negative news about the economy and daily stress of life can make us feel down in the dumps about work and the regular banking day-to-day grind. It would be nice if the daily news reports on the economy were more positive but they are not. If we believe everything we read, the sky must be falling and we should prepare for even tougher times ahead.

So, how does all this negativity affect your community bank or credit union branch network? How would you rate the sales and service attitude in your branch locations this month--extremely positive, neither positive or negative, or down right BLAH?

If you rated your community bank or credit union's branch network sales and customer service attitude anything other than extremely positive, it is more than likely time for a tune-up. A positive sales and service attitude presented by your associates towards your customers directly impacts sales growth success.

Here are the top five things you can do to help improve sales and service attitude in your branch and get people moving in the right direction as identified from our Sales and Service Training Program:

  1. Good Morning Kick-Start. Starting each day at a branch or contact center with a quick five-minute kick-start meeting helps to gather the troops and set a positive attitude for the day. Remember, each person may be coming to work with a different set of problems on his or her mind. Perhaps someone had a problem getting the kids off to school this morning, or perhaps someone else had a car that would not start? You may or may not be aware of the daily issues facing your staff so the morning kick-start meeting is a great time to focus your team for the day and let everyone get on their “game face” before starting the day. Let everyone know why they are working today -- to HELP and care for the customers. That’s right, not to push products or to force customers to take that electronic banking option. Instead, we want to concentrate on actually HELPING our customers with whatever financial needs they may have. Remind everyone that by helping our customers, we are deepening the relationship which will naturally lead to more sales success and happier customers.
  2. Use More Positive Praise. Look for every opportunity to provide positive praise to your branch associates. Each day, use one associate as an example and tell everyone about what made their positive performance special for the customer. Never forget the power of positive praise for a job well done.
  3. Display a Positive Attitude Yourself. If you are a manager and are looking for better attitude from of your associates, remember a positive attitude starts with you. People learn from great mentors. Be assured that if you are a “crab,” your associates will pick up on this and it will affect their performance for the day. You must always lead by example.
  4. Don’t Forget to Smile. Sure it sounds crazy, but smiling sets the tone for everything. Whether you are face-to-face with a customer or talking with them on the phone — smile. Think you can’t hear a smile on the phone? Think again. Try putting up a smiley post-it note on the frame of your monitor or on the base of your phone. Place a small mirror somewhere around your work area. Are you smiling or frowning? Keep reminding yourself to smile for 20 days and it will quickly become a habit. You would never believe this but I went to a bank last year that was paying each customer a five dollar bill if they could catch the teller not smiling during the transaction. Whose brilliant idea was this I thought to myself? What benefit is there in making your customer responsible for employee attitude? Please, don’t make the customer responsible for your attitude. Instead, show the customer your positive attitude by HELPING them and proactively responding to their needs.
  5. Extreme Kidding Around. How many times have you seen a mom in the teller line towing along two young ones. If you haven’t noticed, kids have no patience for waiting. Children expect things to happen instantly. Why not use this opportunity to build deeper relationships with the customer instead of hiding or staring at the parent trying to manage the child meltdown? Start by showing interest in ALL children that visit your branch. Compliment them on how big they are getting, how cute they are, etc. Forget about lollipops and other candy, and give them a real banking experience instead. What kid does not want to see some money? Show them a $100 bill. WOW!! Show them where the vault is located. Set aside one safe deposit box that is filled with plastic coins or some other non-tooth decaying treat. Even better, have some collectable kid coins made with your bank logo on it. Each time they come in, give them another coin for their collection. Does this take a few minutes of your time? Sure it does, but it shows you care and it can also be fun which helps your attitude and those around you. More importantly you just totally impressed mom and she is going to tell five other moms about her banking experience the next time she gets together with friends.
Why is a positive sales and service attitude so important? It is important because your customer has a choice. They can continue to visit the same old bank or credit union or they may choose to walk across the street to a competitor. Given our economy and the competition for new deposit dollars, there is no room for a bad customer experience. Every customer touch must be executed with a total customer caring attitude, from the New Account Opening to listening to customer cues to generate product referrals.

Can you force someone to have a positive customer caring attitude? No, you can’t. But you can create a work environment that makes it difficult to be a “crab.” A positive attitude is contagious. Use your influence to spread a bit of the good stuff this week and make a difference.

Monday, March 11, 2013

Prospects Are an Asset for Community Banks and Credit Unions: Do You Value Them?

Take a look at your financial institution. I would bet you have a lot of people working with you that are tasked with generating new loan and deposit sales. You have commercial bankers, mortgage bankers, branch managers and wealth managers hitting the streets to find prospects that will eventually turn into your new customers. Did you ever consider the amount of time and effort spent in finding and working the prospects before they are converted to customers? Your sales force is spending hours, days and weeks meeting with prospects, going to meetings and other social functions to help build new relationships. Face it, if the sales person had a quarter for each business card they have collected, they would be sitting on a beach in the Caribbean right now instead of working for you.

The issue to consider is we are spending considerable time and money building prospect lists and potential business relationships. Does your institution consider prospects a true asset of the bank? Prospects are an asset of the bank just like purchased computers, chairs and ATM machines. The salary dollars spent generating this asset are very expensive. Sales people have some of the highest salaries in the bank. If prospect data was a bank laptop, would you just let it walk out the door with your salesman when he changes jobs? I would hope not, but that is exactly what is happening in most institutions today.

As a bank or credit union, I am sure you run your organization on a core banking system. Most systems are great at tracking customers but absolutely terrible at tracking prospects. In fact, the majority of core banking systems today do not have adequate capabilities to track both customers AND prospects effectively. To start treating prospect data as an asset to the bank, here are three things you need to do consider:

1) You need to take a systematic approach to treating prospect data as an asset of the bank. What this means to you is you need a system to be able to track prospects across the bank. A centralized database where all sales people can enter the prospect data, maintain the information and share the information across the organization.

2) You need an easy way to allow your sales force to use the system. Most sales people regard CRM or other systems as a hindrance to making sales. They see this as busy work or sales administration which is time wasted. In many cases they are right. Some systems are so hard to use that you can spend too much time entering information into the system only to get minimal value out of it. However, a centralized prospect management system is extremely valuable when combined with management pipeline reporting. Now not only can we maintain our prospect assets but also allow managers to review prospecting activities and help predict future sales closures with confidence.

3) You need to make sure the sales force a) understands why it is important to enter the information and b) realize they will not get paid unless it is in the system. Sorry, but the bottom line is it has to be a job requirement. Saying you forgot to enter your prospect information is not acceptable. Entering prospects, call notes, meeting notes and sales pipeline information show that your sales person is participating in the activities that lead to sales closures.

Prospects are the lifeblood of your institution’s future success. Take actions to secure and maintain your prospects and treat them as the valuable asset that they truly are. If you are searching for a prospecting system or approach designed by and for banking professionals, take a look at IQProspects.

Thursday, March 7, 2013

Mobile Banking Growth Demands New Branch Sales Strategy

For about a year, I have been using a mobile deposit app where I use my smart phone to make deposits by taking a picture of my checks and transmitting them to my institution. I have to say, I absolutely love this application. It is a killer banking app as far as I am concerned. It is a game changer because the number one reason I go to a branch would be to make a deposit. Sure, for years we have used on-line banking and bill pay. We all thought they were pretty cool, but mobile deposits is the Holy Grail when it comes to providing a convenient way to bank for most customers.

So, now we see our banking customers heading towards the mobile banking light at hyper speed. This poses a major problem for community and regional organizations where differentiation is based upon personalized service in the branch. Additionally, if most organizations use the branch visit as an opportunity to learn more about the customer and discuss possible cross-sell opportunities, how will this one killer app on a smart phone change the landscape forever? Most importantly, how must the branch sales culture change to support a model where we may never see our customer face to face?

To be honest, when smart phones started coming out with cameras, I thought to myself, "Why do I really need a camera on my phone?" What I really wanted was a phone that did not drop a call. Would that be so hard to build? Anyway, as the years rolled on and the mobile deposit apps hit the marketplace, I realized the value of the convenience factor of this app. It is so easy to take two pictures on your phone and transmit a check. A few minutes later the deposit is in my account.

Now, if you are a community bank, regional bank or credit union, I would bet one of the defining elements woven into the fabric of your institution is your ability to be a customer centric, face-to-face, relationship building organization like this community bank does. Ok, so how do you keep and continue this tradition in the face of a killer app like this? There is no doubt, you will now see less and less customers walking through the door each week. How do you build your customer centric brand when every customer just thinks of a bank as a transaction house on their mobile phone instead of a one-on-one financial advisor?

The answer to the question is simple. Your sales culture must evolve. If you are going to differentiate your organization as a relationship building organization, you cannot wait for customers to just walk in the door. You need a new strategy focused on communicating with your customer using both telephone and email without hesitation. In the past, you may have never called your customer unless they bounced a check. Now you NEED to call and email your customer on a consistent basis or you will never have the chance to grow the relationship like you had in the past with branch visits.

What this means to the branch is that the game has changed. Job functions must be redefined. Touching customers via outbound calls and emails are new sales metrics for evaluating branch associate performance. Keep in mind, phone skills and email writing skills are required for this sport. Both written and verbal communication skills are key. Do we want our branch associates sending out emails with lots of see you 2moro and XOXOs and other texting acronyms, or do we want them using real words. This all translates into how your brand will be perceived by your customer and is a very important factor not to be overlooked.

Finally, how will you manage the contacts? Will this be the Wild West and we just start calling up our customers randomly each day? What if we call one customer 2-3 times this week because one person did not know we called the customer previously? What if we miss out on the most important customer calls like maturing CDs or maybe a call where a large deposit was made into an account just last night? Using customer banking behavior and analytics to help drive your outbound strategy is the way to go. You will need a system to help centrally manage this for you or mistakes will be made.

When you look at it, the smart phone has and continues to change banking as we know it. It is time to consider your approach and put in place retention and growth strategies that work. It is time to bring this topic into your management meetings now. Don’t wait or it may be too late.

Wednesday, March 6, 2013

Top Banking Blogs – Stay Current on Retail Banking Trends, Bank Strategies, Banking Sales, and Bank Marketing

Banking Bloggers Discuss Top Banking Trends and Strategies

Today at Quest Analytics, we decided to research the top banking blogs and share those with everyone interested in staying current on community banking and credit union developments.

These blogs discuss top banking issues and suggest strategies for bankers to respond to market trends and common issues in banking sales or bank marketing. Every day, these bloggers continue to stay on the leading edge of banking and keep us in tune with current issues, pending or new legislation, and market conditions.

Those involved in retail banking at community banks and credit unions will find these blogs particularly useful. Whether your focus is on bank sales, bank marketing, or just researching bank strategies, these bloggers provide a fresh insight into some of today’s most pressing banking issues.

Take a look at these TOP BANKING BLOGS listed below. We will continue to read these bloggers and add our own insight on our banking blog.

Top Blogs for Retail Banking Strategies, Trends, Sales and Marketing





Royal Media Group


Jim Marous


Ron Shevlin


Cornerstone Advisers, Inc.


Andera, Inc.


ACTON Marketing, LLC


Truebridge, Inc.


Market Insights


Matthew Wilcox


Media Logic USA, LLC




JP Nicols


Jeff Marsico


LemmonTree Marketing Group

You Need to Stay on Top of the Banking Market

With over 20 years of experience supporting banks and credit unions, Quest Analytics understands the rapidly changing marketplace for banking. The first thing you need to do after visiting this posting is to sign up for our own FREE SalesDrive Newsletter so you won’t miss any of our upcoming insightful analysis on bank strategies, sales, and marketing. By joining us and keeping tabs on the blogs listed above, you will have the latest news and analysis from the leaders in the industry.

Tuesday, March 5, 2013

Follow-up Sales Leads Like A Bloodhound

Why do bankers give up on a potential sale so easily? If someone says, “I will think about it,” does this mean you should call them back or would you treat it as a dead opportunity? Too often, we leave valuable sales on the table just because we don’t follow-up like a bloodhound.

Years ago, I lived in England where they still have traditional fox hunts. There is one thing I learned by watching a fox hunt – the dog does not give up! The dog keeps on running and trying to find the fox until the fox is found.

Too often we stop our chase before it even gets started. Let me give you a real life example. A few weeks ago, I stopped into my bank. I have had a home equity line of credit for more than 10 years with this bank. I thought it might be good to see if I could do a bit better from a rate perspective now that rates have dropped significantly. Here is exactly what happened.

I sat down with the branch manager. She was pleasant in her greeting however she did not introduce herself by name or do any type of formal introduction. The branch manager was very polite. She answered each of my questions about the account, rate, and refinancing procedure. After all of my questions were answered, I said that I would discuss it with my wife and we would make a final decision. That was more than 5 weeks ago!

Never once did the branch manager ask for any of my contact details to verify if they still had the correct phone number. Never once did the branch manager ask for my email address. Never once did she hand me her business card so I would know who to call should I have more questions. Never once did she call me back to follow-up on my visit.

If a customer takes valuable time out their day to stop into the branch to ask questions, does that not qualify them as having interest in your product or service? It is time to stop leaving good business on the table and start following-up with every opportunity.

Here is what a banker sales bloodhound should have done:

1) Know your customer. Before a potential customer leaves your office you should know who they are, what relationships they have with you, and make sure you verify their phone number and email address. It is sad to say but phone numbers and email addresses change frequently and most likely your records are old or inaccurate.

2) Hand out a business card. Before they leave your office, hand them your business card. In fact hand them two business cards just in case they need one for their spouse. This is why you have business cards. This year your goal should be to go through as many boxes as possible.

3) Send an email. Directly after the customer leaves your office, send an email! You just verified the email address, so send them a quick email and say thank you for stopping in and you look forward to talking with them in a few days. If the email bounces, call them up and re-check the email address. You must have written it down incorrectly.

4) Follow-up like a bloodhound. Don’t stop until you get a final answer. Maybe is not a final answer. We will think about it is not a final answer. Yes, I would like to make an appointment or No, we are no longer interested is a final answer. 

5) Follow-up again. Lastly, let’s say a few days go by and you do not hear from the potential customer. Now is the time to be creative in your approach. Call them back and this time, use a servicing approach. Here is an example:
Hi Mr. Smith, this is Jane from Your Bank. We talked a few days ago about refinancing your home equity line of credit. The reason I am calling is that I may have forgotten to provide you with one other important piece of information about refinancing your loan. I noticed that you do not use our mobile banking product. Well, with your new line of credit account, you will be able to access this account from our mobile banking application.
This simple follow-up call provides one new nugget of information for your prospect but it also provides you with a valid reason to talk with them to gain commitment.

Don't let a week go by without contacting them again. Bloodhounds don’t give up. Bloodhounds want to win. Don’t you want to win? Sure you do. Stop letting business go to your competitor and start following up like the banking sales professional you really are.