Pub. 6 2017 Issue 3

l e a d i n g a d v o c a t e f o r t h e b a n k i n g i n d u s t r y i n k a n s a s 20 YOU WANT TO GROW? IT’S THE LITTLE THINGS THAT MATTER! M ANY BANKERS believe: “We’re uniquely positioned to serve the affluent customer. Our service is second to none.” But remember, your prospects haven’t experienced your service. And few community financial institutions can uniquely serve the affluent class better than regional and national banks. Real growth requires much more than the false perception that customers are privileged to bring their relationships to you. It takes many factors — like brand, product, policies, marketing, employees and execution. When you try to maintain growth of your customer base, focus is often mistakenly on only one factor. But each activity impacts expansion. Some are more important than others and real growth isn’t assured by any one of them. Real growth requires a coordinated system of activities — all connected to each other. I’ll illustrate this idea using the airline industry. All airlines have planes, pilots, flight attendants, and luggage handlers. All transport people and many fly the same routes. So why does Southwest Airlines have a much better reputation than other airlines? Are Southwest planes better or are their people more professional? No. What Southwest has is a much better activity system. Michael Porter, in his Harvard Business Review article years ago, defined the activity set of Southwest Airlines. Little things competitors could not or would not copy were the difference. Its fleet uses only one type of plane, so maintenance is easier, faster, and cheaper. The airline’s unique boarding system allows flights to turn around quicker. All its activity points — reliable and frequent departures, low ticket prices, high aircraft use — make Southwest Airlines more profitable than its competitors. Let’s take this idea to community banking. Like airlines, financial institutions are all relatively the same. All have checking and savings accounts and all use banking systems recognizable from one FI to another. So how can your activity system give your financial institution an edge over competitors? Key component —Your people Engage your staff, train them, and allow them to have fun. While working with several hundred community-based FIs, I’ve seen what a difference the right branch personnel can make. - Without changes to marketing or product it’s common to see dramatic customer growth after a branch leadership change. - Same-market branches, using identical marketing and products, grow at dramatically different rates. The people component of your activity system probably has the most subcomponents that crucially help or hurt your organization’s growth. Especially in branches, the right people are extremely important. But if staffs are not well trained, branches may not achieve their growth goals. Be there when customers decide to switch It’s almost impossible for financial institutions to create the customer need to buy their products. With basic By Achim Griesel, President, Haberfield Associates