As retail bankers, we spend significant amounts of time, capital and energy focused on maximizing the performance of our distribution network—online, mobile, call centers and branches—so we can fulfill an important goal: to deliver an exceptional, seamless customer experience that builds stronger relationships and growth.
While each channel presents opportunities for improvement, the branch network stands out. It remains the primary sales channel for consumers and small businesses, and consumes significant resources in real estate, staffing and operational expense. Use of digital channels may be growing, but the branch system maintains the greatest potential to immediately improve sales and efficiency.
Which leads us to ask: “Do you really know what goes on in your branches every day?” Based on our experience with thousands of branches, and with detailed tracking of every transaction and activity, we think not.
So where to start? We think a granular view of activities and time spent is in order. There are two ways to do this, and some surprising insights you might gain.
Tick, tock, how long does it take?
We traditionally conduct a time-spend study that measures how long it takes to complete a transaction or sales activity—it can reveal clear takeaways.
First, the time it takes to do these activities does not usually vary at a specific institution, whether between branches or type of branch (traditional, supermarket, high volume, low volume, etc.). What drives the time is systems-related, or policy- and procedure-related. Not much percentage gain comes from finding star tellers or bankers who have a “best practice” you can replicate. Mostly, it takes the same time for everybody because that’s the way you’ve designed it.
Second, the biggest benefit may not result from using this data to refine staffing models. That’s because most bank branches are staffed at the minimum required just to keep the doors open. Calculate the number of hours the branch is open plus dual control requirements, time for breaks and vacations, and it’s hard to get below five Full Time Equivalent (FTE). Saving “fingers and toes” by shifting to part time to shave a few hours has always been difficult—and especially so in this high-employment economy.
This is not to suggest that sophisticated staff time scheduling lacks value; some very good models accomplish this. But that value is mainly limited to larger banks that operate a decent mix of busier branches.
So where’s the value? It comes from asking the question “Why does it take so long? What can we do to make the process simpler?”
Here’s an example. Opening a new consumer checking account often takes as long as an hour, assuming your bankers complete the full profiling, needs-based product review and onboarding you’d like to occur. Those activities you want them to do may seem desirable but when it takes too long—and pushes up wait times—bankers tend to shortcut the process.
And here’s another: Teller transactions are usually short, but we have seen them take as long as 45 minutes. These outliers may amount to just 10 percent of the total, but they represent real opportunities for improvement because they reveal inefficiencies and poor customer experience.
Oh no, where does the time go?
You can also understand what’s really happening in your branches by conducting a “day in the life” study. We’ve found these the most revealing of all.
Here’s why: If most branches do not have high levels of transactions then the real question we should ask is, “Where do people spend their time?” Every branch has busy periods, typically on Monday and Friday. Walk in on a Wednesday and you’re likely to hear, “We’re not busy now, but if you were only here yesterday.” And you know that any branch with a staffing level of 4 ½ -5 FTE just can’t be that busy over its total time open. Otherwise, it would require more staff.
The answer is not, “There’s unused capacity so let’s give them more phone calls, operational tasks, etc.”: something we’ve seen in many banks. Actually, it’s the reverse: “Let’s get everything non-sales or customer driven out of the branch and manage the process, so we can spend more time on sales and business development.”
It’s all true, so what should you do?
A range of programs and methods will improve branch performance. Obvious ones that come to mind include:
a migration to universal bankers
updating staffing models
implementing technology such as cash recyclers
investing in better sales support technology
branch access to fully built-out customer relationship management (CRM)
These efforts are important. But many banks may overlook a step in their process of maximizing branch performance. So what is that step, exactly?
It may sound obvious, but the first step is to understand what’s currently happening in your branch network—and with a granular view, not a broad brush.
What does this granular branch view entail?
Do a time study. Select a sample of your branch network and conduct a three-prong process: time study, observations and self-reporting. Make sure the study represents the type of transactions or activities (consumer and business), and the type of branches. Collect enough transactions to make it believable.
Understand the “day in the life.” Most financial institutions set goals in terms of where staff should spend their time. Sometimes they plot this out quite specifically (30 minutes every Monday on sales huddle; 20 percent of manager time on operational review, etc.). We prefer these kind of well-defined targets that set clear expectations for staff. But whether detailed or not, management always has at least a belief of where labor cost goes or should go.
The gap comes from not knowing the actual activities. Is it what you expect? If not, why? What are tellers doing when they don’t have customers in front of them? Do meetings and internal reports really chew up time the way your staff claims? What can you do to change the cadence of activities to align with your business goals?
Fix the pain points. Play “small ball”: Look for the base hits, not necessarily the home runs. Small gains, easy to implement across multiple branches, add up to major impact. Don’t procrastinate because some issues seem intractable; solve what you can and clear the way to tackle the more difficult solutions.
Engage your front-line staff. Solicit branch staff input on how to improve performance and prioritize improvements. They stand on on the front line and know the reality. You’d be surprised how many times we’ve heard, “If we only did it this way then my life, and the customer experience, would be so much better.”
Going granular matters in banking’s line-item arena, especially when it comes to revenues, profits, deposits and more. In your branches, going granular will make a difference, too—for branch networks, after all, represent the proving ground where activites add up and time truly is money.
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