Bank branches must innovate to meet customer's needs

Whether fair or unfair, the banking world often has the reputation of being slow to change or follow trends in other industries. Part of this is due to the inherently conservative nature of banking combined with far closer regulatory oversight. Despite this reputation, the banking world is beginning to change, particularly in the area of branches. A variety of panels, discussions and other events at the Bank Customer Experience Summit, held from Aug. 31st to Sept. 1st discussed branch trends in greater detail.

At the event, a few topics related to branches came up repeatedly that speak to bigger changing trends within the industry. Let's take a look at a few.

Branches will change their roles

Financial institutions saw some the largest amount of branch closures during COVID-19. In fact, Stephen K Griffin, SVP and director of the Retail Distribution Planning Group at Regions Bank said during his opening keynote address that banks closed 3,324 branches in 2020.

The reason for all these closures is of course COVID-19, but also changing customer expectations. Customers no longer go to branches for routine banking needs like cashing a check or starting an account. They would rather do that online.

However, that doesn't mean customers are abandoning branches altogether. But their reasons for going there are changing.

In particular 58% of 18-34 year olds and 54% of those in the 45-54 age bracket in 2021 said they would go to the branch for advice, Griffin noted. Only 17.3% said they would use digital only in 2022. Griffin argues this fact is due to the fact that digital onboarding has issues and has high attrition rates.

So, how will banks make this change from transactional branches to relational centers where employees can provide financial guidance to customers?

A new bank employee

In order to make this adjustment, banks are having to train a new type of employee, one that can act as a universal banker that can perform a variety of different tasks depending on the needs of the customer.

"We laid out our branch with universal bankers who can do anything we need them to do," Griffin said in his keynote. "They can go through a transaction, loan any need they have. Take them to any room they need."

By hiring this type of employee, the bank can both improve customer experience and create more satisfied employees that have access to a clear career path.

But, how can banks train this type of employee?

Training

For banks to cultivate a universal banker, they need to make sure they are engaging their employees effectively. Unfortunately, many banks only measure employee satisfaction, which may not provide the necessary feedback, as EJ Kritz, EVP, Training and Customer Experience at apc said during a panel entitled, "The importance of measuring what matters," which was moderated by Jean-Pierre Lacroix, president of SLD.

"Employee satisfaction as a metric is dead. I don't care if your employees are satisfied, I want them to be engaged," Kritz said during the panel. "We have to raise the bar with what we are measuring. Not to find out if they are simply happy but truly engaged. Happy employees do a fine job but they don't enhance the place or create the culture."

Sergio Magalhaes, director of Branch of the Future Development at Millennium bcp, said during a panel that his bank utilized a Route 66 model to train employees in customer satisfaction.

Millennium Bank turned Route 66 into a model that involved:

• Receiving customer.
• Obtaining information.
• Using the resources.
• Turning experience into results.
• Exceeding expectations.

Lacroix said this model's strength lies in its simplicity as it focuses taking "the same discipline of communication and strategy to change management to employees and you make it simple to remember with Route 66."

Ultimately, banks will have to take a multifaceted approach to deliver a successful branch strategy.