The business adage that “what gets measured gets managed” is borne out by the Kronos FMSI 2018 Retail Branch Lobby Study, which identifies significant sales and service improvements for financial institutions that have deployed systems for tracking detailed lobby service metrics.
The biennial study analyzes service metrics such as average wait and assist times and the ratio of sales to service interactions to quantify the enormous potential credit unions have for increasing sales and branch service by better capturing and measuring lobby traffic data in managing branch operations.
The study examines 715,000 interactions collected through the Kronos FMSI Lobby Tracker, which encompass all types of service and sales exchanges between accountholders and credit union and bank employees that took place on the platform side of North American financial branches in the third quarter of 2017.
In examining product and service metrics, the analysis finds that financial institutions have room for improvement by focusing their lobby activities toward more product interactions and fewer service interactions. Kronos recommends that credit unions strive for a 60/40 split in product versus service interactions as a way to boost sales.
Currently, overall interactions are split at 46 percent product interactions and 54 percent service interactions. While there’s room for improvement, the good news is that financial institutions are making progress in focusing their frontline staff more toward product interactions, showing an across-the-board increase in the product/service interaction ratio in 2017 as compared to previous studies conducted in 2011, 2013, and 2015.
In 2011 and 2015, 35 percent of all interactions were product-focused, while the 2013 study saw that number rise to 40 percent—only two-thirds of what it should be. This year we saw an 11 percent gain in product interactions over the past two years which suggests that an increasing number of financial institutions are recognizing the benefits of moving more aggressively toward a product-oriented approach as branch traffic patterns continue to evolve away from routine transactions and toward more consultative requests for service.
The study also shows the advantages of incorporating cross-sell metrics into employee performance reviews, citing extensive research that shows members are much more likely to remain loyal when they purchase three or more products/services from their credit union.
Wait time trends
The new study reveals encouraging trend lines regarding wait times at retail branch locations. Wait time is defined as the period from the moment a member signs in electronically when arriving at the branch to initial contact with a service representative.
Overall branch lobby wait time averaged 6:41 minutes for 2017, which is an improvement over the 7:06 average wait time from 2015, but still considerably higher than the 4:46 and 5:08 average wait times from 2011 and 2013, respectively.
The range of wait times between top- and worst-performing financial institutions shows that this critical service metric can be improved through careful management and monitoring. The top 10 financial institutions in the study have trimmed their average wait time from 3:46 minutes in 2013 to 2:06 in the most recent study. On the other hand, wait time in the lobbies of the lowest-performing institutions more than doubled from 6:42 minutes in 2011 to 13:54 in 2017.
This wide variance in wait times between the top- and bottom-performing institutions could be caused by a number of factors, the report notes, including staffing (understaffing for long wait times and possibly overstaffing for short wait times), employees spending too much time on each transaction, and inefficient procedures. Pinpointing the cause for excessive wait times can allow a financial institution to implement steps, such as staff coaching and more effective scheduling, to improve service outcomes.
Upward trends in assist times
The study reveals an opposite trend line for average overall assist times, which Kronos defines as the duration of the interaction between the account holder and lobby service representative. The overall average figure for 2017 was 26:28 minutes, which represents an upward trend over the course of the 2011, 2013, and 2015 studies.
Longer assist times are not necessarily a sign of worsening service and could even indicate that frontline staff are doing a better job at cross-selling. However, there could also be negative reasons for the rise in assist times, such as declining employee performance. The differences in average assist times at the top 10 financial institutions (15:24 minutes) and the bottom 10 (38:36) could indicate deficiencies in coaching or training that are lengthening these interactions in ways that hamper, not enhance, service. One way to determine what is driving assist time trends is to study the amount of time each employee spends with an account holder, per product or service, and compare employees’ performances to establish benchmarks.
Strategies to improve sales and service outcomes
As part of its 2018 Retail Branch Lobby Study, Kronos offers several suggestions credit unions can implement to improve their branch service and product interaction ratio:
- Deploy self-directed technology, such as Diebold’s in-branch technology and interactive kiosks, which can decrease wait times, reduce labor costs, extend access beyond regular branch hours, and position branches as more technologically advanced.
- Use alerting technologies, such as the pop-up alerts provided by Kronos FMSI Lobby Tracker to forewarn of excessive wait times and allow lobby personnel or retail management to respond in real time by redirecting staff to frontline service.
- Channel lobby service traffic to the call center, thus cutting down on wait times and saving members a trip to the branch. Emails and in-branch signage can help remind members about the call center as a convenient service option, and branch staff can be trained to suggest the call center for future interactions. Making a dedicated call center phone available in the branch lobby as an alternative to waiting for a service representative is another option to reduce wait times.
- Implement cross-sell training. Member service staff can hone their skills to uncover potential sales opportunities by asking the right questions at the right time.
- Deploy additional technology, such as tablets for queue management sign-ins, lobby wait-time widgets so members can find out the estimated wait time for a branch on the credit union’s website or mobile app, and staff scheduling software to monitor and predict traffic demands to facilitate more efficient scheduling. Another useful tool, lobby-tracking software, can help align the service requests of members waiting in the queue with the training and expertise of available employees.
These best practices can help credit unions improve sales and service by making better use of their staff and other resources. Understanding service, sales, and productivity metrics can help enhance branch performance for a positive impact on the bottom line.