Take the Complexity Out of Profitable Growth

Focus on everyday basics

salestrainingbanksGrowing profits isn’t complex. In fact, there’s a formula for accomplishing profit-rich growth that few banks have mastered. This leaves loads of room for smart bankers to capture greater market share, attract top prospects, grow core deposits and expand their loan portfolio with A+ credits.

The key is to simplify—not only your focus, but also your priorities.

What’s the formula?

1. Attract A+ Quality Credits at Premium Pricing

Sure, your people think it can’t be done, and that is EXACTLY the problem. In fact, there are several problems at the core of this issue: (1) Your lenders don’t know how to identify who is an A+ quality credit, (2) They don’t know that the approach used with these prospects is completely different from the approach used with B and C quality prospects, and (3) They don’t really believe you when you say your bank can easily do business with A-grade prospects. And they CERTAINLY don’t believe they can get premium pricing across the board.

However, all three of these problems can be solved. In fact, they MUST be solved. If you don’t, you’ll be adding more employees to chase the Bs and Cs that walk in the door, and these bankers will run around looking busy chasing those deals—many of which can’t be made and most of which shouldn’t be made. They’ll come to the credit committee after putting 5-20 man hours into a deal—only to report they can do the deal IF you match pricing.

So now you’re faced with a substandard credit “opportunity”—which you made an expensive investment to attract—and if you do the deal, you’ll likely regret if from both a credit standpoint and a profitability standpoint.

Eventually, you’ll need to hire even more people to do more of the same because they can’t keep up with the applications from people who are not your target market, aren’t A+ credits and won’t close at premium pricing.

It’s exhausting and demoralizing just talking about it. And, on some level, it exhausts and demoralizes you.

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2. Own the Entire Relationship

Forbes magazine reports that the average household has roughly 16 products—mortgages, checking accounts, credit cards, 401(k)s, IRAs, various insurance policies and the like—across various financial institutions.

If you don’t have the client’s entire relationship, you’ll quickly find yourself either matching rates, losing business or getting only the unprofitable part of a client’s business.

If a client doesn’t do all their business with you, they are pushing the “I don’t really trust you” button. Trust means they know you have their best interests at heart—and you’re knocking
yourself out to understand their needs, wants and desires. They understand that you’re committed out of your mind to their financial safety and success.

That’s a far different game from order-taking and rate matching and this collaborative approach helps differentiate you in the marketplace, too.

A recent J.D. Power study found that small-business banking satisfaction is highest among customers who believe they have a collaborative relationship with their bank. Michael Beird, director of banking services at J.D. Power, says, “Those banks that are able to deliver on key practices and partner with their small business customers have an opportunity to differentiate themselves.”

If your people aren’t educated about how to get all the business—and if that goal isn’t front and center every day in what gets measured and celebrated—you’re sending a strong message that capturing a customer’s total business doesn’t really matter.

3. Stay Focused on the Best Use of Time

There are only two things that your people should be doing: wowing customers and pursuing those activities that align with your five key initiatives and the top five results in your strategic plan. Sure, compliance and other areas need to be handled with excellence and grace…but that is NOT your business.

Your business is generating revenue from high quality prospects and clients.

Do you have systems in place to make sure that every employee’s performance plan is completely aligned with your bank’s strategic plan and its objectives? Do your middle managers fully execute your plan and stay in complete alignment with it?

Does your executive team have the systems in place to make sure that this course is followed weekly and adjustments are made quickly for anything or anyone who is out of alignment?

4. Be Vigilant About the “System” of Culture

Do you have people who gossip and make things up—and do you have people who listen to that gossip? Or do your people instead bring you great ideas about how to do things better because they’re infused with a “bring-it-on” attitude (rather than the typical “you’ve-got-to-be-kidding-we’re-so-overworked-now” attitude)?

Culture is a system. It’s not just a happy bus. It’s a happy bus tied to critical drivers whereby people are celebrated for meeting their goals, doing what they’re supposed to do and speaking with complete authenticity…and those who don’t are dealt with.

At the end of the day, culture is a system. If you don’t believe that, you will NEVER have a great culture. It’s a system of raising the bar—slowly, but with great celebration for every milestone. It’s an integration of marketing, strategy, service and focus on the right customers. It’s the point where everyone believes your bank is worth more.

It’s measurement. Celebration. Development of people.

If your people are growing—becoming more authentic in their communication,  appreciating each other more, getting over the “drama” addiction, having more fun and realizing they are the source of joy and results—they’ll soon understand that your bank’s success is about the daily, individual decisions that they make. When people understand that they’re not victims but rather contributors to the world, everything changes.

Is your machine in place? And is your system progressing such that, every week, the bar is raised higher—but never so high that it terrifies the star employees with potential?

That’s the definition of a great culture.

5. Focus on Client Success

With all the banking studies out there measuring customer satisfaction, it’s no wonder that most banks are focused on that wrong thing.

You heard me right.

Your focus should never be on customer satisfaction, but rather on client success. If you help your customers become successful at their business and personal goals, they will never leave you. They will not negotiate pricing. And they will tell all their friends about you.

This outcome is why all systems, measurements and conversations must focus on wildly taking care of clients to assure their success. is focus goes WAY beyond order taking to actually helping their businesses thrive, helping them understand their finances, coaching them to make good decisions and taking a proactive role in their lives.

It’s a far different game from the one played by 95 percent of bankers today. For those few, smart bankers who “get it,” the world is their oyster.

Case Studies:

traynor-state-bank
Hardin County Bank case study
Legence Bank Case Study

More Strategies:

Bank Strategies for growth
bank checklist fo Acquisitions
mto-formula

Solutions:

resources
books
seminars