Disengage auto-pilot to maintain performance momentum at your credit union

In study after study, results indicate that an increasing number of consumers are choosing a “D-I-Y” approach to accessing financial products and services. According to a report by Accenture, 52 percent of U.S. adults utilize smart phones and tablets to conduct their banking business whenever and wherever they choose. For this increasing number of technology savvy, time-strapped consumers, standing in a teller line or driving miles to the nearest branch to conduct specific tasks is a thing of the past.

With the rise in the number of video ATMs and mobile apps that provide access to online banking services, traditionally staffed financial institutions are finding themselves in a situation where they must adjust to new service preferences if they are going to thrive.

However, adapting to changing consumer service preferences is no easy task. Making the shift takes time away from on-going operational responsibilities, requires hard decisions regarding legacy products and services, and can be expensive. But when compared with the cost of losing account holders to competitors that have taken the necessary steps to understand what consumers expect from their financial institution, taking a serious look at your overall business structure can be a very wise investment.

When was the last time you took a reading on your credit union’s performance?

You may already benefit from taking periodic measurements of your ratios and trends on a monthly, quarterly and annual basis – or when you’re involved in strategic planning initiatives. But do you have a realistic view of what those ratios are telling you? Are you considering your particular environment versus a generic look?

“You may already benefit from taking periodic measurements of your ratios and trends on a monthly, quarterly and annual basis … but do you have a realistic view of what those ratios are telling you?”

– Jan Southern, Senior Consultant

The value of these numbers to your credit union’s overall performance level is enormous. But there are other areas you should address, such as:

• Is your staffing model efficient?
• Are you keeping up with technology?
• Have you fully implemented products in which you have already invested?
• Are you deviating from established procedures and efficiencies?

How you answer these questions can determine whether or not you are essentially inviting your members to walk out the door and take their business to the nearest competitor or online provider.

Realigning your operations and services to match consumer expectations

A review of your credit union’s overall performance – approached with an unbiased perspective – can help your institution to realign operations and product offerings without affecting the level of service you are currently providing. This in-depth analysis uncovers a wealth of information regarding staffing and product profitability models that will help your credit union to establish key performance indicators. Plus, it will give you valuable insight into the tools you need to maintain successful performance for years to come.

“A review of your credit union’s overall performance – approached with an unbiased perspective – can help your institution to realign operations and product offerings without affecting the level of service you are currently providing.”

 – Mark Roe, National Sales Director

Start by reviewing staffing capacity

In a traditional face-to-face service environment, maintaining friendly, knowledgeable and efficient personnel in every department and service line was a financial institution’s only link to its account holder base. Today, as busy lobbies are giving way to increased electronic connections, incorporating a right-sized staffing model can be key to profitable performance.

A Staffing Study is an effective tool to help facilitate appropriate staffing levels and scheduling – both now and as your personnel needs fluctuate in the future. Findings can help reduce overtime and redistribute human resources during peak and non-peak business hours. In some cases, this may identify instances where part-time staffing is more efficient than full-time – which can result in cost savings.

As a result, your employees can work more efficiently and your members will be guaranteed a more satisfying experience.

Also, by optimizing your staffing expenditures, you will have more flexibility to redistribute your personnel costs due to staffing changes or special short-term service initiatives. Excess dollars can fund new services – such as a call center – or be used to upgrade benefits or to add personnel to an under-staffed department. Or you can return any savings to the bottom line as an expense reduction.

Find profitability in product offerings

Needless to say, two priorities for members today are speed and convenience. If you don’t offer the same level of mobility and product diversity as your competition, your profitability will suffer.

But technology isn’t the only answer to designing products for maximum impact on your bottom line.

One way is to ensure that your members are utilizing products that are most closely aligned with their needs and habits. If a business owner is conducting a high volume of business through a regular checking account, you could be losing out on the service charge revenue that is structured for high deposit or debit volumes. Plus, your member is not receiving the best service for his or her business needs.

A Product Profitability Study will examine your products to make sure they are providing the most benefit to your institution. For instance, debit card income is generally either the first or second largest non-interest income opportunity for a credit union. And while an increase in this line item does not impact the member, it can provide a healthy boost to your bottom line.

What’s more, by examining all of your account data you can uncover the information you need – through such tools as predictive analytics – to determine how new product offerings can best meet account holder needs going forward.

Realize your potential

Performance improvement studies – conducted by an expert in business process reengineering – will identify and implement changes in your institution that can result in maximum productivity and business efficiencies. Throughout the discovery and implementation process, the expertise they bring will help to identify areas for improvement, and provide a roadmap for your staff to follow in order to re-analyze your processes and product offerings as conditions change.

In today’s business environment, you can’t be successful by doing business the way you have always done it. The more information you have about how to gain efficiencies in your operations and uncover new opportunities to increase your product profitability, the better equipped you will be to stand up to the competition. And with the right business structure in place, you will be able to provide your account holders with the products and services they need today and into the future.

Contributing Author: Jan Southern