The Dirty Dozen: 12 processes every bank must get right!

michael's picture

In a prior post I introduced the idea of an efficiency ratio that starts with a 4.
To see these kind of results, banks and credit unions only need to address a dozen, common, everyday processes.

80%-90% of the processes that banks perform are repetitive.
The same thing over and over and over.

With Teller Capture, Check 21, and debit, the processes for customers to access their money are as efficient as ever.
These processes have one thing in common.

They use electronic information and images throughout the process.
And they use them well.

Your Dirty Dozen Processes may also use electronic information and even images.
Just not very well.
In fact, it is so bad that it is the primary reason for efficiency ratios in the 60's and not the 40's.
As you peruse the list below, think of the content generated and used in each process.
Content that takes work to access and produce.
Content such as forms, emails, checklists, letters, policies, procedures, spreadsheets, reports.
Think about the location of this content.
Shared drives, desk drawers, file folders, email folders, "systems", filing cabinets.

The Dirty Dozen Processes

Critical 4 Customer Facing Processes

  • Commercial Loan Delivery: Deal Flight to First Renewal
  • Mortgage Loan Delivery: Lead to Investor Sale/1st Payment
  • Consumer Loan Delivery: Application to Lien Perfection
  • New Account Delivery: Product Sold to 1st Statement
  • Top 4 Customer Support Processes

  • Loan Servicing: Booking to Collateral Release
  • Account Servicing: Booking to Closed Account
  • Reg E: Fraud Suspect Identification to Resolution
  • Reg E: Chargeback Request to Resolution
  • First 4 Internal Processes

  • Human Resources: New Hire to Termination
  • Accounts Payable: Invoice to Check Reconciliation
  • Branch Compliance: Activity Schedule to Log Completion
  • IT: Change Request to Completion
  • With just these 12 processes being high performing, the bank will be high performing.
    It's almost guaranteed.
    When the majority of the processes in this list are manual and paper-based, it's nearly impossible to be high performing.

    Which group are you in?

    The Critical 4 are your future and should be prioritized as such. In a future post I'll talk about whether or not you need a new stinkin' loan origination or platform system.

    The Top 4 complete the lifecycle of two the Critical 4 and the two Reg E processes round out where our rush to debit left off.
    It has always amazed me how billions of dollars and millions of transactions can flow through the EFT networks, but as soon as a debit dispute or chargeback hits everything we already know electronically is rekeyed and printed and we become manual monkeys and hustling hamsters trying to beat the clock.

    The First 4 are the start of a laundry list of internal processes that need to be reengineered for high performance. Since they are not Customer Facing or Customer Support, you should always have one of these in the reengineering mix or you'll simply never get to them. Customer's first, right?

    When you review the Dirty Dozen list with your peers, give each a grade and a sentence on your process improvement strategy for it. If nothing comes to mind, give us a shout.

    -CroalDude

    About Agile Banking
    Agile Banking provides consulting, solutions, and skilled digital laborers that address the full lifecycle of information management.
    Bank-In-A-Box is our preconfigured for OnBase imaging and workflow system that is easy to use and integrates with any core system.
    Loan Vault Decimation is our turnkey solution to quickly and accurately scan and index entire paper filing systems.
    Record Schedule for Banking is our nationally compliant record retention schedule that manages electronic records in any ECM to final disposition.
    ExactImport automatically transfers documents between OnBase and ExactBid's RIMS appraisal management system.

    We are passionate about process and data, and experienced as bankers.
    We are where information management works!