Sticking with the Status Quo could be your Bank’s first step to failure
Corporate culture has been a hot topic for many years. Some banks want a sales culture, we prefer an advocate or service culture. Some want a family culture and many, whether they know it or not, have a subculture.
Related: Is Your Bank’s Subculture Taking Over? (Featured in the Texas Independent Banker)
Regardless of what you call it, your community bank’s culture should be a Culture of Production. One that drives profitability and growth. Unfortunately, many banks are not seeing great results because of an overriding Culture of Protection or as some would call it… The Status Quo. It’s kind of like big government where the politicians and special interest groups are protected at the expense of everyone else. A culture about protecting me, my stuff, and my well-being instead of one that focuses on the customer and the shareholder. Is your bank driven by a culture of protection? Here are three key areas to examine in order to know where your bank stands.
Protecting the Program
On the surface there is nothing wrong with protecting a program if it’s working. The problem begins when the program fails to drive positive results or even worse, there is no clear way of tracking the results. Sometimes a program, such as an incentive, may not be working as originally intended. If you’re paying team incentives, be very careful. Odds are, the incentive is creating resentment from top producers who are being paid the same as the worst producers on the team. Wells Fargo protected a program that was clearly broken and we all know how that ended. Take a deeper look into all of your programs and ask the following questions.
- Is it profitable? – Can you accurately track the results to know the profitability?
- Is it compliant? – Just because it was last year doesn’t mean it is now.
- Does it fit into the culture or philosophy of your bank? – If you have a relationship-based culture, are you offering out of market CD rates to capture business? Just something to think about.
Protecting the Employee
This is an area that stumps many community banks and managers. We completely get it and understand that you work with people you care about and may have known for many years. No one likes firing an employee, especially if he’s a likable employee who’s been with you for a number of years. However, the reality is that far too many managers and banks are putting the protection of an employee’s job over the production and profitability of the bank. This can’t happen. A manager needs to clearly define expectations for each employee, provide the tools and resources to do the job, and then hold that employee accountable to the expectations. Keeping an employee that is not performing or is simply in the wrong job will only demotivate your best people and keep the so-called protected employee from having an opportunity to find a new job that fits his talents and where he can be successful. Ask yourself the following questions about each of your employees.
- Is she meeting or exceeding expectations? – Have you even set any? Have you set the right expectations?
- Would you hire her today, knowing what you know? – There’s your answer!
- Is she a net gain or a net drain? – Is she costing your more time, money, and effort than the production and profitability she is bringing in? Not sure? Then maybe your boss needs to ask these questions of you? Just saying.
Protecting Yourself
If you find yourself in the unenviable position of feeling like every decision you make is weighted with the need of protecting your position, your job, or your influence, then it may be time to make a move. Walking on eggshells in fear of micro-criticisms of those aggressively analyzing each and every move or decision you make is a clear sign of “it’s time to go”. Either stop protecting yourself or begin projecting yourself, your ideas and your performance to a point of excellence or to a point of a resume builder. Either way, you win and the company that ends up with you wins.
The path of production
When you approach the fork in the road of protection vs production, don’t always take the path of least resistance. It’s tempting, but quite often the one of least resistance is the path of protection. Instead, choose production. In the end it’s really the only reliable path there is.
