Jon Voorhees, former head of Distribution Strategy and Execution for Bank of America, has joined Peak Performance Consulting Group as a Consultant and Advisor.
During his 17-year career at Bank of America, Jon was responsible for optimization and transformation of the bank’s physical distribution channels including branches and ATMs. He acted as a key architect of the Bank’s strategy, which achieved significant financial savings while retaining nearly all customers despite closing/divesting over 1000 banking centers and 3000 remote ATM sites.
Furthermore, his team delivered the bank’s first Outstanding rating on the OCC CRA Services test by creating an innovative approach to modeling CRA impacts on customer usage patterns.
In 2011, he led a year-long project to introduce advanced distribution planning methodologies to a major Chinese bank, leading to development of a new integrated distribution planning system.
David Kerstein, President of Peak Performance Consulting Group, stated “Jon has more experience than almost anyone else in the industry in actually implementing major distribution reconfiguration. He understands how to deliver the mix of channels that customers want today, and not only capture financial efficiencies but actually grow customers. Jon’s tremendous experience complements the deep strength our organization has in distribution strategy for both physical and digital channels, revenue growth strategies and branch staffing strategies.”
“All financial institutions, whether community banks or larger regional and national banks, are grappling with the best way to deliver the mix of distribution and services customers demand,” stated Voorhees. “I have been tremendously impressed with the work Peak Performance Consulting Group has done for its clients, ranging from community banks to regional and national institution and I am pleased to be part of their team.”
Financial institutions can improve the customer experience by making themselves easier to do business with, being guided by the Voice of the Customer and by systematizing data collection and usage.
This article was originally published in BAI Banking Strategies on April 4, 2016. Mark Hendrix is an Advisor at Peak Performance Consulting Group.
BY MARK HENDRIX
In today’s digital economy, banking, like other industries, faces “disruptive” expectations from customers. Both individuals and businesses expect access to and delivery of services virtually on demand. Winning companies are responding by creating innovative approaches to the customer experience. They have learned that re-calibrating their processes, bringing them into alignment with customer expectations, has resulted in new sources of revenue and productivity.
How can bankers accomplish this? By offering value in three areas:
To be successful, Bank-at-Work programs must deliver effectively on three elements: partnership, value proposition and sales execution.
This article was originally published in BAI Banking Strategies on March 11, 2016
It goes without saying that retail banking has many moving parts and Bank-at-Work programs are no exception. From target strategy to sales protocols and from results tracking to offer fulfillment, successful program implementation requires that banks maintain a comprehensive structure around their Bank-at-Work initiatives.
But within that program structure, three things stand out because without them you’ll just be spinning your wheels. They are: partnerships, value proposition and sales execution. The formula goes like this: partnerships get you in front of company decision makers; value proposition gets you in front of employees; and sales execution gets you incremental revenue. Sounds pretty simple, but the reality is very few programs actually focus on these key essentials, which is the root cause of why many retail Bank-at-Work initiatives run aground and get shelved.
Banks need to eliminate complexity by simplifying processes and customer interactions, with the payoff being lower expense, higher customer loyalty and reduced risk. This article was originally published in BAI Banking Strategies on January 5, 2016
Consumers are increasingly self-reliant and see time as a resource that is just as valuable as money. Moving forward, delivering a timely customer experience will be an important factor in winning in the market.
Banks, however, have a hard time delivering on this customer demand for timeliness due to their innate complexity, with business models that reflect the uneven integration of multiple lines of business such as retail, business banking and investment banking. Over time, these organizational processes have often been “spaghetti wired” from legacy systems that are not fully integrated. Recent regulation further complicated matters, adding additional infrastructure that increased operational layers and cost.
Bankers are increasingly aware that this unplanned complexity has gotten out of hand and harms the ability to deliver for customers. In our recent survey of financial services executives, 68% of respondents indicated they have initiatives in place to simplify their business models. How should an organization tackle this task?
Start with a change campaign. With so much at stake, you can start anywhere – beginning, middle or the end – but take the first step. Start by mapping process steps and identifying activities that are duplicative, or do not contribute to efficiency.
Once a root cause has been identified, develop the management routines to determine the legacy drivers in Information Technology (IT), operations, service, channel and organizational structure. Several remedies that can yield immediate productivity are:
- Eliminate hand offs;
- Remove paper processes;
- Standardize data capture and governance;
- Implement voice of customer research on how customers shop, buy and use your products and services.
Embedding these changes is not a function of technology but rather of change management and organizational leadership. Enterprise Resource Planning can provide reports and metrics to identify opportunities. But improvements are a function of leadership attention to the experience drivers that create real value.
Jim Marous, who’s work I respect, asked for our insight and input to his annual Top 10 Retail Banking Predictions. Here are 4 predictions for 2016. What do you think?.
Universal Bankers will become “universal”, and will be the standard staffing model in most bank branches. And this will not just be cross-trained tellers but a true merging of the teller and personal banker role.
The shift to digital will accelerate. Up to now it has primarily impacted routine monetary and service transactions. But we are at an inflection point where account openings and advisory services will be delivered remotely. This will represent a fundamental shift, where the physical branch will support the digital channels, rather than the reverse.
With more touchpoints, mapping the customer journey becomes critical. Understanding where they start, how they use channels in tandem, and where they stop along the way will be essential to managing relationships in the future. This will require adoption of new data management tools and skills.
- The call center is back! It will no longer be a support function to the branch network, but rather the hub of the customer experience. With customers using more channels than ever before, they expect consistency across all touchpoints. These new “customer experience hubs” are well positioned to bridge both physical and digital channels.
This article by Guenther Hartfeil, a Senior Consultant at Peak Performance Consulting Group, was originally published in BAI Banking Strategies on December 3. 2015.
Cross-selling can be effective if bankers put the right metrics in place, change behavior of sales staff, align incentives, re-focus on customer needs and eliminate policies that get in the way.
It’s common knowledge that it’s easier and cheaper to sell to existing customers than to attract new ones. However, according to studies at two major banking institutions, many cross-sell efforts result in little or no improvement in customer profitability.
There are two primary reasons for this. First, most banks do not have an effective way to accurately track “new-to-the-bank” funds. Typically, sales staff receives credit for new accounts opened and the bank projects value based on typical account balances.
But this does not account for the significant money churn between existing accounts. Analysis I conducted at one large financial institution showed that, depending on the deposit product type, between 25% and 79% of funds into newly opened accounts came from deposits already in the bank. For example, it’s pretty easy to switch account types, say, from one type of savings into another type of savings or one certificate of deposit (CD) term into another CD term, or open accounts for new family members by using existing account balances. Churn is less but still significant at 25% to 30% for brokerage accounts, non-auto direct loans or home equity credit.
Another reason that cross-selling may be ineffective is that projected balances or anticipated account activity may not materialize. New checking accounts usually start with a small balance and grow over time as the relationship builds, or as new customers wind down accounts at their previous financial institution. However, sales staff may inadvertently receive incentives to generate account volume, “widgets” rather than value because of product configuration, deficiencies in tracking capability, or both. For example, free checking – a product that many institutions have now discontinued – was so easy to sell that the overwhelming majority of new accounts opened at most banks was “free.” The number of accounts grew dramatically, but balances often did not follow.
Here are five strategies for making cross-selling more profitable: