BY Meredith Deen, FMSI
It’s Not All About Mobile and Online
Performance-Based Commissions Drive CU Efficiencies
If your credit union is considering going teller-less in an effort to improve efficiency, you may be on entirely the wrong track. Studies show that incentivizing your front-line employees is what’s really propelling profits. Find out why the teller is still a CU’s driving force.
It’s no secret that an uncertain economy has financial institutions taking a hard look at operating expenses, and the teller line has certainly come under scrutiny.
A number of credit unions are introducing teller-less branches and they’re ramping up their mobile and online efforts to drive efficiencies. Those kinds of measures are important, but they may not be enough. Properly incentivizing front-line employees with performance-based commissions, too, can significantly impact the bottom line – driving up staff performance and cross-sales that benefit members and the CU.
In fact, FMSI studies show the strong cost benefit of incentivizing tellers. Through analysis of over 15 million teller transactions taking place at over 2,200 branches, FMSI has developed a side-by-side comparison of those institutions utilizing an incentive program and those that do not. Our latest findings: Those banks and credit unions that provide incentives have an average labor cost per transaction that is 14 percent lower than their non-incented counterparts. More about that later.
So better efficiencies are not all about the best mobile app and online banking site. And for those who think the branch is going away, the 2015 FMSI Teller Line Study shows that branches are staying around – evolving into centers for trusted advice and sales. In this new role, the study shows, branches will deliver what FMSI calls “higher-quality” interactions that lead to a greater share of members’ wallets.
