Alignment with Corporate Strategy
Leading large and small banks recognize that branch staffing strategy, tactics and tools have broad implications that go far beyond traditional expense and revenue management. The previous trend of staffing branches at the lowest level possible is no longer a viable competitive strategy. Today, branch staffing levels must be synchronized with desired service levels, and service levels need to be aligned with the corporate strategy.
If the corporate strategy is organic growth, branch staffing levels must then support delivery of high levels of customer service. Customers will not consider additional purchases unless a bank has met or exceeded sales and service expectations on past purchases or banking experiences.
Additionally, prospects and the local community view the branch as the de facto public window into the bank. If the branch does not have its act together, it is assumed the bank does not have its act together. Getting the branch staffing level correct is vital to enabling branches to meet and exceed customer expectations.
New technologies make the alignment between corporate strategy and branch staffing levels easier. But first, to understand where we are going, it is enlightening to understand where we came from.
Evolution of Branch Staffing Models
Twenty years ago banks began accepting the value of staffing models and the need to manually survey branches to get a sense of customer patterns, productivity and wait time. Given the limitations of bank systems at that time, and the significant manual effort involved, first generation staffing models were often treated as a special finance project.
Ten years ago, as technology became less expensive and more powerful, second generation staffing models were introduced. These models used daily transaction data from the branches to develop forecasts of monthly transaction volumes and make staffing level recommendations. The relative ease with which the data could be collected and calculated led to the institutionalization of a new function – the branch staffing group.
Five years ago, the introduction of 3rd Generation Staffing (3GS) models featured web-based branch scheduling based on patented methodologies and algorithms. Now branch managers were empowered to make decisions based on budget, service parameters and volume forecasts. While a breakthrough, some inherent model limitations remained.
These 3GS solutions are not based on a true picture of branch activity. 3GS staffing solutions create schedules based on assumptions and processed transactions not how many customers walk through the door or how long they wait in line. A traditional model cannot “see” what actually occurred in the branch – for example, it assumes flawless execution of recommended staffing levels, it assumes transaction throughput equals actual customer demand and it assumes that model assumptions consistently reflect the dynamic branch environment. A model is by definition “a system of postulates, data and inferences presented as a mathematical description of an entity or state of affairs”. In this regard, staffing models are analogous to math problems; they require a cross-check in order to validate the answer. Fourth generation staffing models incorporate a complementary system that cross-checks the model and “sees what is actually occurring in the branch”.
Building a Fourth Generation Branch Staffing Model
Today’s successful banks use fourth generation branch staffing models by upgrading current staffing software and installing a new system from Brickstream Corporation. GMT, which makes companies more profitable through effective workforce management, has enhanced its current staffing software to automatically accept key data from Brickstream’s system. GMT Planet, the company's flagship product, is a flexible workforce management and workforce optimization solution that adapts to meet the needs of retail banks, processing centers, financial institutions and entire enterprises. Simplistically, the traditional branch staffing model forecasts transaction volumes, projects transaction times, infers wait time and estimates staff productivity and utilization. GMT now pulls in Brickstream system information on branch customer arrivals and volumes, customer wait times, and transaction times in order to provide for a closed loop forecasting model.
Fourth generation staffing utilizes a mix of sensor types deployed in the physical branch to collect key business metrics on the customers behavior. Data from each sensor is collected and cleansed via a common platform allowing a common set of analytics to be performed on the data. This information includes the true traffic demand, actual service standards, actual wait-times as well as teller utilization to name a few. These metrics are then fed across the network to the GMT server, allowing the GMT Planet software to use the pertinent information in the inputs of the latest forecast as well as measuring the schedule effectiveness afterwards. By integrating as much of the actual data from the branch you no longer have to make broad assumptions across your network.
Together, Brickstream and GMT provide all the components of a fourth generation staffing capability. By cross-checking assumptions in the model and ensuring the model depicts the realities of the branch operating environment, an efficient and effective branch staffing plan – proven to meet targeted service goals – can be developed. These revolutionary breakthroughs in retail banking appear once a decade. This GMT/Brickstream combination is truly revolutionary in that retail executives can now confidently and consistently achieve the optimal combination of branch productivity and service improvements across their retail branch network. Every customer focused bank will want to leverage this powerful combination. Prior to the integration of these offerings, and using a similar concept, Fleet Bank was able to save an estimated $10 million dollars using Brickstream and staffing software. This is the breakthrough that progressive retail executives have been waiting for.
Royal Bank of Canada (RBC) has been a thought leader in the area of Workforce Management and Resource Optimization and initially had years of efficiencies derived from the using BehaviorIQ and GMT Planet separately. By combining them, RBC has taken staffing a big step further, decreasing wait time, improving service, and increasing customer satisfaction and teller sales opportunities. This combined solution has provided RBC with insights into efficient and effective complement attribution strategies with greater knowledge on actual service results. This solution provides the real-time insights into staffing and results that were never known before.
Linkage of Branch Staffing, Brand Management and Marketing
Branch staffing impacts not only service quality in the branch but also brand management and marketing. Visionary executives view branch staffing as an extension of marketing and align the branch staffing strategy with the marketing strategy. The marketing message of many banks is that they care about their customers. Bank marketing departments spend millions of dollars communicating this message. It is critically important that the staffing levels demonstrate a commitment to this message.
Corporate logos, trademarks and taglines are the visual components most associated with brand. However in the service industry the most visceral part of brand is the experience at the point of sale and service. This is the moment of truth that either reinforces or tarnishes the brand. Across a typical retail bank there are a million customer interactions and therefore a million opportunities to strengthen or dilute the brand. A measurement system like Brickstream provides timely and factual feedback of the quality of the brand experience.
Brickstream can also be integrated with market research findings and customer satisfaction scores. By linking customer satisfaction scores with actual wait time or transaction time, for example, it is possible to determine what is driving the score and take corrective action. Sub-standard wait time could be driven by one or more factors such as increased turnover, compressed training, new policies and procedures, new government regulations, system conversions or branch open hour adjustments.
With continuous monitoring by the Brickstream system cause-and-effect relationships become obvious. Banks can now correlate leading indicators, such as poor wait time and long transaction times, with lagging indicators such as customer satisfaction and favorability scores.
Balancing the Model with the Brickstream System
In the end it is all about balance. A fourth generation staffing model balances past, present and future. The model goes beyond weekly and monthly averages and assumptions and incorporates factual daily information. Today’s model transcends the finance function and plays a prominent role in the delivery of service quality and brand reinforcement. Holistic staffing models incorporate the latest technology from systems like Brickstream to “see” and report branch activity in real time and link it to corporate strategy. Fourth generation staffing capabilities achieve a balance of yin and yang by coupling traditional staffing models with the Brickstream system.
The author Frank McIntyre is an executive vice president at Transcend International LLC, a New York based management consulting firm. Previously, at FleetBoston Financial, Frank was the Director of Branch Staffing, Capacity Planning and Wait Time Metrics for Fleet Bank’s 1,500 branches. Frank can be contacted at Frank.McIntyre@vzw.blackberry.net.
More information on Brickstream Corporation can be found at their website at www.brickstream.com.
