The rise of the machines in community banking
Robotics have been commonplace in manufacturing for quite some time. Automation and technology have driven much change in banking over the past decades. Now we see that actual robots or “humanoids” have entered into the banking business. Check out this article from the Wall Street Journal about a robot working at a Japanese Bank, “Pint-Sized Humanoid Helps Customers at Japanese Bank“. On the surface, one may think that a robot could never replace a real person in a community bank. In a big bank? Sure! But never in a community bank… think again. The future is now and don’t be shocked if these little robots start finding employment at your local community bank in the very near future. ATM machines are already replacing tellers, so don’t think a robot can’t replace you or part of your job. According to a recent Oxford study, 47% of today’s jobs could be automated in the next two decades. So, what are the warning signs that your job could be outsourced to a robot?
You might be replaced by a robot if…
- You’re an Order-Taker – If a customer asks for something, you’ll answer the question or fill the request… and nothing more! This employee is not rude to customers, in fact, he may be very personable and polite. But in his mind, offering other products and services only means extra work. He’s there to do the minimum to keep his job and still collect a paycheck. If a customer calls the bank asking for CD rates, he doesn’t ask additional questions of the caller to discover opportunities, he just gives the information requested. A simple phone shop will show you who the order-takers are. The opportunity cost and employee cost of the order-taker could easily cover the investment into a serviceable robot.
- You have no profitable relationships – Most community bank employees know many of their customers to some extent, but it’s amazing to see how many of those employees will avoid offering these customers appropriate products to fill a need. This employee thinks the customer will ask for it if and when they are interested it. A profitable relationship is one where the customer values your advice. A profitable relationship is one where the customer sends her friends and family to do business with you. If this isn’t the type of relationships you have, then your bank could probably replace you with a real robot and avoid employee costs like health insurance, workman’s comp, 401k, a salary and more. Robots can’t have relationships, so technically you are the robot.
- You’re a Paper Pusher – Some loan officers consider it a good day when the pile of papers on the left side of the desk makes it to the right side of the desk before 5pm. Many support jobs have already been replaced by technology and machines. If you’re a loan officer maintaining a book of business, look out! What’s your real value? You better have profitable relationships and a growing book of business. In support roles you either need to know how to lead and manage or be the one that fixes the machines, programs them, or enters data into them or you might be replaced. I’ve had loan officers that have just managed my loan and there was nothing they gave me that a good online presence, and effective call center, or one of those “pop up, 24/7” support people online couldn’t offer.
- You’re a fireman manager – You have experience but you don’t actively manage. You don’t set expectations, you don’t hold employees accountable, you don’t motivate your team, and you don’t develop your employees’ careers. If you’re not managing then why are you in the branch? Customers that have a question could just pick up a phone in the lobby that will send them to an automated system to answer questions. Or maybe there could be a kiosk in the lobby that connects them to a data base of answers to common questions. Local branch managers in community banks may soon be replaced by a regional manager that actually manages the full-service kiosks and virtual tellers in the local branch.
- You can’t sell without props – This is the manager and team that can’t grow a branch without offering a special CD rate or a free toaster with a new checking account. A self-service kiosk or an online service could sell checking accounts that offer a free prize. When ordering Directv service a year ago, I just went online and selected what I needed and got the free NFL package as a gift. I didn’t need a real person to sell me that. If you can’t bring in core deposits without a gimmick, then how are you really different than an online application or self-serve kiosk?
Real employees with real relationships have real futures
We believe there will always be a need for real people in community banks. However, those real people will be actively engaged performers that have real relationships with profitable customers. The technology and automation will allow the smart community banks to place these superstar employees in front of their most engaged and profitable customers and advocates. If you find that one of the employees described above is you, then understand that now is the time to change. Don’t allow a robot to define your future. Build relationships and become the employee your bank can’t afford to lose.
