I wonder if all of the vendors who offer branch teller and platform software are going to send Bill Gates a Christmas gift this year. He might deserve it.
The latest operating system changes seem to be forcing the last of the branch system holdouts still running DOS or Windows 95 to begin facing the inevitable move to 2000 or XP. This may be the result of recent announcements by several vendors that they will sunset support of DOS new accounts/teller systems within two years.
Well, for whatever reason, there’s a lot of talk in banks recently about replacing or upgrading branch systems, and it begs the question: What should we expect of the next generation of branch new accounts/sales systems?
Not too sure, you say? Well, fear not, loyal readers. We at GonzoBanker are always willing to deploy a mixture of time zone changes, sleep deprivation, high sugar/caffeine diets, 20 years of food additives, and various environmental toxins to force a futuristic vision on almost any subject.
We’re entering the third phase of branch new account systems. The first versions offered by vendors focused (correctly) on fulfillment, primarily the opening of accounts. The second versions added basic sales capabilities, mostly designed to supporting cross-sell efforts, e.g., basic customer profiling, scripting of encounters, and prompting additional product offerings. Most of these tools focused on the sale of deposit products.
Now we begin design of version 3. And while everybody is struggling to sift through this massive sponge of a concept called CRM, two things are already clear:
Here are some issues bankers should take into consideration when looking at new accounts systems.
We regularly survey our clients and spend time in their branches to see how branch sales representatives allocate their time by product. On average, managers allocate 50 percent of their time, or less, to deposit activities. CSRs spend 65-80 percent of theirs on deposit-related activities. That means that one-third to one-half is spent in other areas. They generally tend to be, in order of time spent:
At this point, every one of these activities involves a separate system or is a manual process. Future versions of branch systems will need to support these activities, either through basic inquiry/transaction capabilities or seamless links to the other systems that use the branch system as the single entry point.
In the last few years systems have provided branch bankers with better data about their most profitable customers, and they are expected to use this information to keep and grow those relationships. To do that, bankers will service all the needs of those customers locally. That means all, folks. If a problem needs to be solved, the branches will solve it. If research needs to be done, branches will do it. These customers won’t get passed to ops or the call center or anywhere – nor, given their value to the bank, should they.
This means branch systems will still need to focus on the unglamorous task of automating maintenance transactions, research, and problem tracking/resolution. Don’t overlook this. And bear in mind that the need for branch employees to access whatever customer history is in the system used at the call center is a given. Most banks, realizing this, will look at both branch and call center systems if they are reviewing systems.
In most banks right now, it’s a sloppy process. Look at what your new account reps need to do to open a checking account and then complete a simple loan application (which you’re incenting them to do). Two systems. Redundant input. A mess of forms. This process needs to be simplified.
New branch systems will either have to support basic consumer and small business lending activity, or will need to link seamlessly (i.e., share information) to whatever system does.
My partner Steve Williams has written several times about the opportunity presented by small business banking and how branches will be at the core of the initiative. New branch systems need to support small business banking through interfaces with cash management, imaging, lockbox, and other systems used to service the business customer that may house information, transaction history, or other customer information needed by the bank to manage the relationship.
Everybody has campaigns for maturing CD customers and mortgage borrowers who might need a HELOC, and they work fine. However, future campaigns will be “smarter” and more focused – i.e., selling a small business package to clients (existing and new) that might qualify based on criteria determined by internal and outside information.
These campaigns will require branch systems to download customer lists for particular sales campaigns, assign them to branch employees, allow the ability to track and report results, and interface right to the opening/doc prep systems.
If a bank stacked all the forms its branches use to track and report sales, referrals, call lists, incentives due, results from campaigns, and related reports in a room, there’s a good chance the regulators would write it up for a fire hazard. Systems will have to get smarter in creating these reports. People spend way too much time on this. Yo, bankers. Want to “free branch employees from redundant tasks so they can sell more?” Reduce and automate manual sales reports. Vendors, some help here…
Branch bankers are expected to sell deposit and loan products, refer investment and trust products, get mortgage applications, refer or sell insurance, call on businesses to get cash management services for the bank, prospect potential, commercial deals, and so on. The fact is they need a whole lot of good product knowledge to do all this, way more than when I was in a branch. And, for all the good intentions everybody has, there isn’t enough time, money, or staff to get them out of the office and train them in all of this. Even if you could do it, turnover would force you to start again next year.
Future systems need to help address this problem. Computer-based training on new products, better help fields when a banker is selling, better edits, embedded links to Web sites where somebody can go study and learn… all of these need to be better deployed and utilized.
Many vendors will say, “We have all of this already.” Great. Here are my questions. Who is your current client that has made the most use of all these features and measurably reduced training costs and time while maintaining or improving effectiveness? Who has measurably reduced errors through online help/training? Who at that bank can I call and talk to about how they did it? If you can answer these questions in a demo, by the way, you’ll have some big defenders come decision time. Take it from the gray-haired guy in the back row.
Now the branch system will never do everything. It won’t replace what loan systems or data warehouses or profitability systems do. However, if the branch employee is the point person in key relationships, the branch system is the point system that will need to support him or her across all aspects of the relationship. This is a long-term project. Let’s start with the vision.
As for what to get for Mr. Gates for the holidays? Well, you could do worse than the beer-of-the-month club or the famous yuletide cheese log. When in doubt, stick with timeless classics.