Branches aren’t going away but most built for a different era. Should you keep it, close it, move it, remodel it, or add capacity to capture market opportunity. And if you remodel, should it be a simple re-fresh or a full remodel?
Jon Voorhees, who is now a consultant with Peak Performance but formerly was senior vice president for retail distribution execution at Bank of America, discussed these issues in a presentation at Esri’s annual mapping conference in 2014, including some of the ways distribution planning is integrated into the overall bank strategy:
- Market investment prioritization
- Branch & remote ATM planning
- Regulatory compliance
- New branch forecasting
- Customer spotting
- Attrition-retention modeling
- M&A analysis
- Risk mitigation
- Asset management
As BB&T and other banks look for every possible competitive advantage, no matter how small, GIS software is playing a key role in developing ever-more-precise views of data. While GIS tools have been around for years, the software has become more advanced recently and more and more banks are using it for an increasing number of projects.
“You could look at a spreadsheet with 30 columns and try to figure out your decision, or you could look at a map and see it all in one place and the decision becomes much more apparent,” said Jon Voorhees, a former senior vice president for retail distribution at Bank of America, who is now an adviser at Peak Performance Consulting Group in Austin, Texas.
Now, banks create maps using multiple layers of data, tracking everything from the rate of nonperforming loans to levels of homeownership in specific census tracts. Mapping software can also help banks monitor potential security threats and even manage where and how to deploy executive talent.
For years, community banks have tried, with varying degrees of success, to boost fee income through wealth management. Now, thanks to the robo-advisory trend, smaller banks can compete more effectively, even with larger, more established players according to a new article in ICBA’s Independent Banker Magazine, Say Hello to Your New Employee.
The article highlights the experience of Cambridge Savings Bank and quotes David Kerstein, president of Peak Performance Consulting Group.
“A robo-advisor allows banks to have the potential for greater control over their services, and it allows them the opportunity to be able to service more of their customers and to manage it under their brand,” according to Kerstein.
“Conventional wisdom would say that robo-advisors would be more important to younger, more digitally savvy customers, but that’s not necessarily the case. For Cambridge Savings, the Connect Invest platform has gained widespread interest; its average user is 47-48 years old. ‘It’s not just millennials.’ says Kerstein, a consultant to the bank.”
John Voorhees, consultant and advisor at Peak Performance Consulting Group, was one of seven experts asked to share their vision of what bank branches will look like in the future in this Banking Strategies article and as part of the Executive Report on the Evolution of the Branch.
Speaking specifically about how customers will be assigned, John states “The platform will consist of even more specialists, and platform bankers may be assigned a portfolio of customers when issues need to be resolved—think of the olden days when you could go see ‘your banker.’ Customers may be able to communicate with branch personnel via Skype and more banks will also have private soundproof rooms in which customers can have face-to-face conversations with offsite bank specialists via video-conferencing.”
Good article in Banking Exchange — including our point of view — on the Wells scandal and aftermath: what it means for cross-sell and the sales culture.
Forty-odd years ago, banks didn’t “sell.” Yes, they had new accounts representatives and calling officers. Some even admitted to having marketing directors. But no salesmen.
Sell was a dirty word.
That was something they did down at the used car lot. That was the business of people who pushed life insurance. That was something that, frankly, everybody else did. There was something plain unbankerly about selling.
But gradually, banks realized that sales and all the trappings—goals, incentive pay, and sales management—really were part of banking. Some accepted this grudgingly, some realistically, and some enthusiastically. One of the latter, although hardly the only one, was Wells Fargo.
- Is sell a dirty word in banking again?
- In a post-Wells Fargo settlement period, dare bankers utter that word?
- In a time when UDAAP has become, and remains, the law of the land, can selling in banks survive?
For years the industry’s eyes were on Wells Fargo as a cross-selling winner. That reputation went down in flames with last year’s sales scandal. But banking’s eyes continue to scan Wells, which recently introduced a revamped performance management and rewards program that the bank’s leadership described as a beginning, subject to revision based on ongoing experience.
“The devil is in the details,” and the potential improvement lies in careful monitoring were points of agreement among experts interviewed by Banking Exchange who looked at the summary released by the bank earlier in January.
“It’s a very positive step,” says David Kerstein, president of Peak Performance Consulting Group. “I’m pleasantly surprised that they have taken such aggressive steps. I think this is the right way to go for the industry, not just for Wells Fargo.”
He says it would be essential to use such tools as mystery shopping to have an independent view of how well the program works where customer meets banker.
“You have to be sure that you are building customer relationships and doing the right thing,” says Kerstein. “Wells had lost sight of the overall customer,” he adds, in its earlier emphasis on cross-selling. If the bank can make the team dynamic work and produce the longer-term results it hopes for, that will be a very positive development, he says.
Further, if employees can truly work as a team, and the incentives pay off in that context, “turnover may be reduced,” Kerstein adds.