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Strategies for Optimal Teller Scheduling

Workforce utilization management – the process of tailoring staff schedules to meet need and thereby eliminating wasted payroll hours – is an especially complex task when it comes to tellers. Banks want to minimize customer wait time in their branches, but busy periods are often short and unpredictable. The tendency has been to use industry forecasts and past experience and hope for the best.

Fortunately, new technologies are enabling banks to automatically perform analyses on in-house transaction data and use it to achieve far more efficient scheduling, not only for tellers, but also for other branch staff who are used to fulfill the teller role intermittently. Banks that employ such methods can save tens of thousands of dollars, per branch, per year, as can be seen in the Teller Workforce Utilization Study performed by our firm late last year.

The study, which incorporates transaction data from more than 1,000 branches across the U.S., quantified the productivity difference between high- and low-performing branches. We found an 18% difference between the top and bottom performers in terms of workforce utilization (WFU), a metric for the percentage of time tellers spend on volume (customer-facing processing) transactions.

That may not seem like a significant difference, but consider this: The worst performing branches in the study were at 64% WFU, which means that 36% of their tellers’ time was spent on non-volume activities. Of course, no bank can reach 100% WFU because of auxiliary activities such as balancing and opening/closing (our benchmark is 75%). However, unless a branch is harvesting and using transaction data, it is virtually certain that its WFU is below the 75% benchmark.

Here’s the good news. There are proactive steps a branch manager can take to identify problems and achieve at least moderate improvements, such as:

Evaluate Non-Teller Staff. Consider what non-teller staff – managers, supervisors and platform staff –  you are using to cover teller line volume and determine if this is an appropriate use of their time, given their intended role/position. Ask yourself if the volume could be handled more efficiently by staff whose stated job description is to process customer-facing transactions.

Establish a firm expectation for the use of non-teller staff regarding teller line coverage. For example, is the expectation for a Head Teller to spend the least amount of time processing transactions? Then, have a coaching discussion with teller supervisors/managers to set expectations for their role.

Set Teller WFU Guidelines. Review the performance of staff whose primary function is to perform teller transactions and estimate how much time they are spending performing non-processing functions. Your employees should be able to estimate this. Make it clear that honesty is important and that there is no “wrong” answer.

What are the tellers doing when they are not processing teller area transactions? Is it work that adds value to the organization, branch and/or customers? Are you scheduling employees as efficiently as possible to meet the volume needs?

Incorporate WFU Scheduling Practices. Implement industry best practices by scheduling the optimal level of tellers based on historic transaction volumes. Use higher paid positions on the teller line only when absolutely necessary to ensure service excellence. Undergo a thorough review of branch traffic flow service needs and abandon the “because we’ve always done it that way” mentality.

Hire Part-time Tellers. Hiring part-time staff for peak volume hours is the most cost-effective means of covering those periods. Part-time tellers generally do not perform as many ancillary duties as full-time staff, and, if the positions are staffed correctly, are not present for non-busy periods. As a result, their WFU is often as high as 90%.

Implement a Workforce Utilization System. The steps above can only take you so far, and, realistically, even some of them are more successful and easier when you have metrics for WFU in hand. Consequently, we urge all banks to implement a transaction-based workforce optimization initiative. With such a program, transaction data from your core processor is harvested and compared against your teller schedules to determine periods of non-volume activity. This enables the most efficient scheduling possible. The system can be implemented in-house with custom programming or you can purchase a third-party solution.

In the current challenging economic climate, all banks are searching for ways to improve their bottom lines. The labor cost of tellers is one of the largest line items on the expense sheet. Yet, Celent estimates that only 3% of North American financial institutions use a dedicated branch efficiency staff reporting and scheduling system. Adopting all the recommendations listed above could decrease your overall teller labor cost by 30% or more.

Mr. Scott is president and CEO of Alpharetta, Ga.-based Financial Management Solutions, Inc. (FMSI), which provides financial institutions with business intelligence and performance management systems for efficient staffing. He can be reached at [email protected]