Credit union managers constantly seek ways to increase productivity within their existing branch operations. But before addressing productivity, there are a couple of key points to consider.
The first consideration is location. If the branch is in a poor location, productivity improvements will likely be hampered or ineffective regardless of effort. The second consideration is benchmarking. Credit unions need to determine some benchmark of performance in order to measure productivity.
Several Approaches to Boosting Productivity
With these two considerations addressed, several approaches to increasing productivity can be discussed. An overriding point that needs to be considered when implementing productivity initiatives is budget, given that the options will likely require an expenditure of resources to achieve productivity gains.
One of the first areas to consider is improving staff efficiency, which can be achieved in several ways, but technology seems to provide the biggest "bang for the buck." One solution, for example, is to improve transactional through-put (or speed of transaction) on the teller line by introducing cash automation in the form of teller cash dispensers (TCDs) or teller cash recyclers (TCRs). By reducing teller cash handling time and improving balancing, this technology will likely provide a 30% increase in teller through-put (as claimed by the various equipment manufacturers).
Another opportunity is determining if electronic documents can be introduced on the retail platform. Electronic documents reduce the time to open new accounts or process loan applications (i.e. electronic account forms, electronic signature pads, and electronic files, providing MSRs with more time to interact with members, increasing sales opportunities.
Consider Self-Service Delivery Options
The next solution to consider is the introduction of self-service delivery options in the lobby and drive-through lanes (i.e. coin counters for members to count their own coins, biometrics that permit members to enter the safe deposit vault and boxes without assistance from CU personnel, and full-service ATMs that can take bulk cash and check deposits and image the checks for processing). Moving tasks previously performed by staff to self-service options improves staff productivity and efficiency while providing more time for the staff to engage in sales opportunities.
In addition to technology solutions relative to the staff, technology solutions also can be applied to members, including remote deposit capture, mobile banking, and home banking. Moving transactional functions from the lobby may enable the CU to reduce staff in the teller area. Finally, retraining the staff to use technology will be a key factor in fully realizing productivity gains.
Productivity gains also can be derived from the market where the branch is located. It is prudent for every CU to periodically review its marketplace to determine if the demographics, income levels, or traffic patterns have changed. This is necessary to determine if delivery channels should be adjusted or product mixes changed to accommodate the changing market environment.
For example, the market environment might dictate more personal service delivery which can be accomplished via dialog delivery. A dialog delivery layout replaces the traditional teller line with teller kiosks strategically placed throughout the lobby. This layout removes barriers between employees and members, encouraging more robust conversations or "dialog" and promotes the concept of one-stop shopping for products and services. This concept combines the functions of the teller and MSR into one person (via cross training) to maximize the use of branch resources and potentially reduce staffing and open up more opportunity to increase wallet share per member.
Another delivery channel influenced by market forces is the video banking concept, using full-function ATMs enabled with two-way video connected to a call center for teller transactions. This concept consolidates teller staff in a central location to service several branches from this one facility. Efficiency gains as described by several institutions that have embraced this delivery system could be 40% when fully implemented. In addition, the concept permits expanded hours with little impact on staffing.
All of these solutions can be implemented to positively influence productivity. However, these solutions will go for naught if there is not a comprehensive strategic plan with a cost/benefit analysis included. These changes encompass investments in hardware, software, renovation of facilities, modification of service delivery channels, employee training, or a combination of all these elements.
Without a plan for guidance and analysis of the cost/benefit the achievement of the productivity gains and ultimately revenue enhancement may not be realized.
Tommy Loo is Director of Business Strategies for LEVEL5, Atlanta. For info: www.level5.com.