Hidden opportunities to improve branch efficiency

Operational efficiency is the result of one or more of the three following factors:

  • Employees who know what they are doing and are motivated to do it.
  • Processes and procedures that make operations more efficient, or at least do not slow things down.
  • Technology that improves rather than hinders productivity.

Each factor carries the opportunity to benefit or disrupt productivity. When all three factors are working together in a constructive way, then significant gains in operational efficiency are possible. Conversely, factors exerting a negative influence can cancel benefits from other factors. When multiple negative factors are in effect it can harm institutional productivity.

It is important to look at process improvement initiatives holistically. For example, over the last 15 years branch capture of what were traditionally proof items has become the norm, and proof departments are virtually extinct. Branch capture represents an increase in overhead from the branch’s perspective, but from an institutional perspective it is a significant gain in productivity. Many financial institutions have implemented other technology-based opportunities such as: currency automation, in-lobby self-service kiosks, scheduling software, document imaging, etc.

What are often over-looked are smaller tasks that make up a significant slice of the day-to-day requirements of running a branch operation. These include:

  • Daily, weekly or monthly account reconciliations
  • Inventory of controlled items
  • Status updates (e.g. monthly problem loan updates)
  • Forms or data entry for items outside of core teller, platform and lending applications
  • Monthly audit certifications
  • Capturing data for operational business analytics

These functions are obviously being handled one way or another, because they are a required part of the operation. However, it is often a collection of spreadsheets, email templates, paper processes and so on. The results are frequently not available outside the branch, or require additional overhead in the back office to get the information into a form that can be reported or analyzed. Employees must learn multiple processes and use multiple tools to accomplish the tasks. In many cases tasks such as these simply are being done “the way they have always been done” because individually none are quite worth the time and effort of a process improvement effort.

What if all the processes not serviced by core applications could be automated together using one application that could not only automate, but schedule and track, the processes? Employee time devoted to overhead tasks would be reduced. Tasks would be done on time with greater accuracy and if not, someone notified. Training time for new employees would be reduced because many tasks would be handled in a similar fashion. Performance for accomplishing these tasks could be measured. Back office reporting or tracking overhead would be reduced because all the data would automatically be centrally stored and available.

In other words, a material improvement in branch efficiency and overall institutional productivity could be achieved. The hard part is to do this without spending more in time, effort and cost than the improvement is worth. However, in an era where interest margins are squeezed and regulatory costs are increasing, it can be beneficial to reevaluate the everyday aspects of the operation.

If you are interested in a free consultation to explore the possibilities, please contact us.

David Basri

David Basri

Mr. Basri has been designing and implementing software and process improvement for financial institutions for over 35 years. He has worked with, and gained experience from, over 500 institutions both ... Web: www.pointent.com Details