Now More Than Ever, Sales Important

CU360
March 3, 2009 | COMMENTS

Despite the current economic upheavals, opportunities do exist for financial institutions willing to accept and use alternative ways of thinking. Midsize institutions, in particular, stand to benefit from dropping old processes and sales practices that can undermine performance, Atlanta-based Proudfoot Consulting reports.

Among the most obvious issues facing all financial institutions are inefficient processes and questionable loan criteria, according to Proudfoot. Although many of these operational issues are not new, they intensify the effect of current financial challenges and undermine future growth and recovery efforts, asserts John Hayes, managing director of financial services with Proudfoot, in an interview with Bank Systems & Technology.

The key to addressing operational issues lies in transforming the branch, according to Hayes. "This is where the people are," he says. "And financial institutions need to change their people. For example, many FIs made huge investments in CRM. That's the easy part—the technology. What they really need to do is change their people by taking all the inefficiencies and non-value-added services and processes from the branch so that tellers can listen to consumers. Once transaction-oriented tellers start to listen, they ask questions, and these questions bring opportunities."

The concept of the branch as a sales center has been gaining traction in the financial services industry. The idea is to eliminate low-value processes from the high-touch channel so that employees can concentrate on revenue-generating activities and providing more personalized service to consumers. "You can say the same for call centers," adds Hayes. "You want to move from being transaction-driven to a cross-selling channel. So FIs need to try to re-engineer their operations by taking out the waste."

Changing Behavior

The technology already is in place to achieve this, Hayes points out. Again, the challenge is getting employee buy-in. "You have to change the behaviors, culture and processes and keep tweaking," says Hayes. "It might even mean having to let go or reassign some branch managers because they don't have the skills set to operate like this."

Hayes notes that some of the more successful midsize financial institutions often use tools that monitor key performance indicators at branches. "These tools can increase sales by allowing the FI to set targets on things like quality or how quickly a loan is opened. You're getting your people to perform against key performance indicators—you're holding them accountable," he explains.

"The same problems are everywhere, no matter the size of the FI," Hayes continues. "They all make huge investments in technology but they still have to align the people with the technology. Even if you're an outstanding FI, there is always an opportunity to improve your bottom line through revenue enhancement and cost reduction."