As we head into the second half of the decade, most retail bank managers recognize that the survival of their institution is tied, at least in part, to redefining branches as sales and service hubs. They also recognize that a key component of that redefinition is improving branch lobby efficiency and service.
So, how’s that going? Our 2014 Retail Branch Lobby Study, an in-depth examination of 265,000 sales and service interactions by financial institutions (FIs) across North America, serves as a useful benchmark since we can compare the relevant metrics to 2011 data. Overall, we found that many FIs are making little progress and some are losing ground in three key areas: lobby wait times, customer assistance times and product-to-service ratios.
Waiting Game
Lobby wait times, for example, have crept up from 4.46 minutes to 5.08 minutes. This isn’t surprising, perhaps, in an environment where FIs are downsizing their branches. Nevertheless, with the advent of so many options for lobby traffic monitoring, analysis and alerting – not to mention forecasting and scheduling solutions that produce highly accurate workforce schedules – such an increase should be avoidable. While lobby wait times don’t constitute the sole element of good service, they are certainly something that customers notice.
There is significant disparity between the best and worst performing FIs in our study. While the top 10 institutions had wait times that averaged 3.46 minutes, the bottom 10 institutions averaged 6.59 minutes. For both groups, wait times had inched up, but for the bottom group, wait times had grown to nearly double that of the top performers’ average.
To be sure, we don’t advocate for zero wait times and never will. In an efficiently staffed branch, the ebb and flow of business will result in some wait times and customers understand that. But performance below the norm runs the risk of customers taking their business elsewhere.
The study found a similar disparity for customer assistance times, or the time employees actually spend with account holders. In this category, top performers showed improvement, albeit very slight. Their average assistance times dropped from 17.58 to 17.38 minutes, while comparable times for the bottom 10 performers rose from 24.45 to 26.24 minutes, representing a 50% disparity between the two groups, a significant difference from anyone’s viewpoint.
Furthermore, assist times were up, overall, to an average of 21.50 minutes, or 5%. This increase in assist times is likely driving, at least in part, the longer lobby wait times. However, that doesn’t negate the need to address the excessive customer service wait times.
Long assist times are not necessarily a bad thing since customers could be receiving helpful service. However, based on our experience working with credit unions and community banks across the U.S., lobby and customer service/sales activities must be managed in close connection with one another to drive maximum financial returns.
When long assistance times are not supported by higher sales figures, management must dig deeper into the problem. Inadequate sales and service training programs, overly social customer service representatives (CSRs) and inefficient, non-productive FI procedures are three common culprits for long assistance times not translating into sales.
A related and equally important metric from the study was that even the top performing FIs are not hitting an optimal product-to-service ratio, in terms of assistance interactions. FMSI (and other industry) research supports the supposition that a 60/40 product-to-service interaction ratio results in the highest potential for sales and greater profitability. Yet, in our study, no group averaged that magic number.
The best performers achieved a 50/50 ratio between product and service interactions, while the bottom 10 performers averaged 26%. This is disappointing, across the board, and underscores the significance of excessive lobby wait times and assistance times.
Data Collection
So, how can low performers improve? The first step is to make sure that they have the right performance management information. One option for collecting lobby and assistance metrics might be a tablet or smartphone app that signs customers in when they arrive and then checks them out as they proceed through various steps in the process. Specialized software could also tabulate CSR interactions based on comments they provide during the assistance session.
Optionally, a purpose-built lobby-tracking application can often handle data collection for all three of the key performance indicators of excessive wait and customer assistance times and product-to-service ratio. The most difficult but still possible means of collecting these metrics is through manual recordkeeping and observation.
Once a bank knows its own lobby, assistance and product/service numbers, management is in a position to decide what thresholds they consider unacceptable and then take corrective action, if needed. Here are some suggestions from our customers:
Paring excessive wait times. To keep wait times to a minimum, at least one person can be trained to stay engaged with the lobby and proactively work to reduce excessive wait times. Quick fixes include moving a universal associate from another area, pre-screening customers through personal interaction or tablet-based sign-in, or stepping in directly to help customers. Depending on the layout of the office and the other duties of designated personnel, managers may also need to create an alerting system, driven by technology or teller observation, to ensure the designated “lobby helper” is kept abreast of lobby happenings.
Keeping assistance times in check. As we mentioned earlier, excessive assistance times can result from both positive and negative interactions. However, banks that are not seeing higher sales from long assistance sessions still must take action. Video-based service/sales training that focuses on friendly efficiency, as well as role playing with top associates, are proven techniques for making assistance time count.
If assistance sessions are resulting in higher sales figures, bank management may not need to tweak its approaches to customer assistance sessions. Rather, this information might make the case for staff increases in the lobby if wait times are excessive. Conversely, if wait times are exceedingly short and assistance productivity is still high, a bank might be able to reduce its lobby staff and gain further efficiencies.
Optimizing Product/Service Interactions. Selling the right ratio of products and services, with friendly, attentive service within a reasonable time frame, is the end game that can turn unprofitable branches into successful sales and service hubs. To improve interaction and sales ratios, banks should evaluate their sales programs, from training to production incentives.
One success strategy is to offer better/more training in “needs-based” selling. Associates who ask customers the right questions and listen attentively to the account holder’s specific requirements often close the sale.
A final suggestion that is gaining popularity – and that can improve metrics in all three of these core measurement areas – is “virtual” assistance. Here, a sign-in mechanism evaluates customer needs upon their arrival at the branch and gives them the option of expediting their visit by conducting their business via kiosk, mobile app or even an old-fashioned phone call from inside the branch. Assistance on the other end can range from a basic call center representative to a specialized sales associate, depending on the customer and the request.
Ms. Deen is chief operating officer of Alpharetta, Ga.-based Financial Management Solutions, Inc. (FMSI), which provides financial institutions with business intelligence and performance management systems for efficient branch staff scheduling and lobby management. She can be reached at [email protected].
