Making Bank Employees the Stars of Continuous Improvement and Innovation
Case Study Preview: The brick and mortar banking industry is usually not considered a hotspot for continuous improvement and innovation. However, one growth-minded regional bank found a path to revenue growth, greater profitability, and improved talent retention by expanding its continuous improvement program beyond conventional models. Read how bank leaders unlocked hidden improvement opportunities by trusting the know-how and creativity of their workforce and equipping them with a toolkit uniquely suited to their staffing and budget constraints.
Prior to the Great Recession, many banks invested heavily in Lean Six Sigma to emulate the proven benefits experienced by manufacturing industries. And in most instances, it proved a worthwhile investment. But today, under pressure to reduce overhead costs and respond to greater regulatory requirements, Lean Six Sigma deployments in many financial institutions have been pared down dramatically, usually to a smaller staff of experienced Black Belts assigned to complex process improvement projects suited to expert data analysis.
For the EVP of Operations at a regional bank with more than 650 branches and 15,000 employees, marshaling resources for a backlog of customer service and operational process improvements was like fighting for table scraps with a pack of hungry dogs. And with staffing reductions in the bank’s Lean Six Sigma staff, there were far fewer improvement projects being commissioned. As she confided, “Growing in an industry like ours requires keeping customers and taking others away from competitors. The only way to win is through better service and operational performance. I was frustrated by service complaints, both from customers and internal partners, and at the same time, complaints from employees about cumbersome processes and procedures.”
Growing in an industry like ours requires keeping customers and taking others away from competitors. The only way to win is through better service and operational performance. I was frustrated by service complaints, both from customers and internal partners, and at the same time, complaints from employees about cumbersome processes and procedures.
Adding a Complementary Toolkit for Continuous Improvement
A conversation with a colleague from another bank about the challenges of freeing up time and resources for continuous improvement led the EVP to Rapid Action, an innovative method for expanding continuous improvement and innovation through employee teams. Developed by Leap Technologies and perfected over 20 years and through hundreds of deployments, Rapid Action integrates change management with simplified Lean and Six Sigma concepts to make continuous improvement and innovation projects more accessible for employees and much easier for leaders to support.
What attracted the EVP to Rapid Action most was the ability to deploy the process quickly without having to add support staff or take employees off the job for training sessions. Equipped with Rapid Action’s “all in one” team toolkit, frontline leaders are able to plan, launch and lead improvement teams on a just-in-time basis, without the need to train employees ahead of time. Guided by structured weekly action meetings, teams learn tools and methods for sharing and analyzing ideas as they work on their assignments over a 60-day or faster timeframe.
Based on a review of the process and toolkit, as well as numerous case examples of Rapid Action teams solving problems in financial services, the EVP accepted Leap’s offer to provide an onsite demonstration of Rapid Action. The EVP also wisely engaged the head of Administrative Services, to whom the internal Lean Six Sigma team reported. As she noted, “I was very excited by what I saw in Rapid Action, but I also knew for it to have legs in our organization, I needed the support of our Lean Six Sigma team.”
The subsequent Rapid Action demonstration gave representatives from Operations and Administrative Services a clear picture of how and why Rapid Action teams work, including:
- Project charters carefully scripted to link priority process improvements to key performance metrics
- Teams composed of employees actually engaged in the process across functional areas
- Team leaders operating with a complete toolkit to guide their teams through a series of weekly meetings over a 60-day or faster timeframe
- Team members able to participate on the team with minimal disruption to daily work commitments
Rapid Action’s ready-to-deploy, non-expert-dependent design, along with its documented record for producing measureable results, earned the confidence of the EVP and her Administrative Services counterpart to support a pilot test of Rapid Action. According to the Manager of the Lean Six Sigma Project Office who attended the meeting and supported the decision, “I was a little skeptical coming into the meeting because the last thing I wanted to see was introduction of another methodology for continuous improvement that would create confusion in the organization. However, I was pleasantly surprised by the complementary positioning of Rapid Action with Lean Six Sigma.”
I was a little skeptical coming into the meeting because the last thing I wanted to see was introduction of another methodology for continuous improvement that would create confusion in the organization. However, I was pleasantly surprised by the complementary positioning of Rapid Action with Lean Six Sigma.
Rapid Return on Investment
Within three weeks of the decision to move ahead, four Rapid Action teams were launched, with employees representing branch locations, the call center, and various support services teams, depending on the project. Each team was led by a supervisor trained and equipped to implement the Rapid Action Toolkit. Leap provided coaching support that was supplemented by line operations and resources from the Lean Six Sigma Project Office, who shadowed the process in preparation for assuming Rapid Action coaching roles.
One of the Rapid Action teams took on a challenge that has impacted most banks in the wake of the Great Recession: How to balance competiveness and customer service quality with an increased regimen of new regulations? The team’s assignment focused specifically on the problem of transferring IRA funds between bank and brokerage accounts, a process subject to an increasing number of customer service complaints due to delays, multiple signature requirements, and the like.
The Funds Transfer Team (with representatives from brokerage, retail banking, pension services, and compliance) launched in a four-hour meeting where team members brainstormed, sorted and prioritized potential solutions for addressing the problem, including:
- Redesign of the IRA Funds Transfer Request Form to simplify, standardize and prevent errors
- Reduction in the number of signatures required for transferring funds, while maintaining required controls
- Elimination of internal checks for funds transfers to speed processing and reduce costs
The actions highlighted above are typical for Rapid Action teams: problems addressed with practical solutions that are often “sitting on the sidelines” for lack of a productive way to engage knowledgeable employees. By implementing these ideas (and four additional ones) over the next 60 days, the Funds Transfer Team reduced administrative time associated with transfer requests by more than 40 hours a week, while cutting turnaround time on requests nearly in half.
And just as importantly, the team’s efforts had a big impact on cross-functional understanding and cooperation. As one team member commented, “We learned from this project that relatively simple processes can get very complicated when there are many hand-offs. Rapid Action gave us a way to challenge the status quo and implement creative solutions while maintaining necessary controls.”
The other three Rapid Action teams in the pilot program attacked additional customer service and internal productivity issues, such as onboarding new lockbox customers. All teams completed their assignments within Rapid Action’s 60-day timeframe and together freed-up more than 250 processing hours per month for customer service enhancement.
Rapid Action for Expanding Continuous Improvement
35teams deployed over 12 months
Continuous Improvement, Employee Engagement, and Leadership Development
The results from the pilot program paved the way for installing Rapid Action as an integrated component of the bank’s continuous improvement and innovation initiative. Next steps included:
- Training members of the Lean Six Sigma Project Office as Rapid Action Coaches equipped to train new Rapid Action team leaders and support teams as needed on their 60-day projects
- Establishment of a quarterly schedule for conducting Rapid Action Workshops for Department Heads and their designated team leaders
- Installation of a Rapid Action Results Tracking Log and publication of Rapid Action Team Snapshots to both recognize team accomplishments and spread good practices
In the first year of deployment, Rapid Action yielded more than $800,000 in productivity savings, third-party fee savings, and net revenue increases, easily returning more than 10 times the investment. Participation by nearly 300 bank employees on Rapid Action teams also produced “soft benefits.” According to the EVP of Administrative Services, “While we didn’t move forward with Rapid Action for these specific reasons, seeing an increase in our Employee Engagement Survey Scores and a very positive response from Department Heads about Rapid Action’s value as a leadership development experience has cemented our commitment to this approach.”
While we didn’t move forward with Rapid Action for these specific reasons, seeing an increase in our Employee Engagement Survey Scores and a very positive response from Department Heads about Rapid Action’s value as a leadership development experience has cemented our commitment to this approach.
Now in their fourth year of deploying Rapid Action, the bank continues to monitor and track results, including employee perceptions about the value of the process and tools. With scores over 80% for “exceeded my expectations,” Rapid Action has clearly earned a prominent place in the bank’s commitment to continuous improvement, employee engagement, and leadership development.