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| Citizens Financial Bank: New People, New Processes |
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| Written by Ashley McGown | ||
| Tuesday, 01 September 2009 01:00 | ||
To begin, the team met with a consultant who analyzed the situation and used the team’s goals to devise a feasible solution that included the implementation of several phases of changes across different levels of the organization. A corporate evaluation was used to determine what the group’s expectations were in relation to both the deposit and lending sides of operation. According to Tom Prisby, CEO and chairman of CFB, the team decided to tackle its recruiting process first. “It didn’t take us long to realize that the first step toward success is making sure we hire the right people,” he said, noting this effort proved especially useful in the recruitment of relationship managers, like full-service loan officers.  Improvements to the recruitment process included a tweak of interviewing techniques; specific questions replaced vague inquiries, and something called Predictive Index was added. Predictive Index is a short test that’s given to prospective employees to determine their current and potential skill levels. Prisby said the index is essentially a self evaluation but can be very telling. Prior to implementation, CFB administered the test to existing employees, which helped determine how useful it was. But evaluating the index wasn’t the primary reason the employees were given the test; the employees’ results were analyzed by the senior executives who were trained in the application of the tool and then used to develop coaching tools. Lean and mean Using a program called The Five Impediments, CFB started at the top, first training managers and subsequently rolling out the new processes to tellers and personal bankers. Employees involved with branch and back-office operations were the first to undergo training; 18 months later, the program was introduced to the lending staff. “Working with a consultant proved very useful,” Prisby said. “The consultant established the training program and helped us develop training methods and materials for each group within the organization.” Specific groups were identified within CFB, and The Five Impediments program was introduced to each on an individual basis. To begin, Prisby and his team met with members of each group to help identify specific factors that impede day-to-day operations. After, group leaders were responsible for devising and implementing methods focused on removing those impediments, like moving certain work to the back office and removing duplicate and otherwise unnecessary processes. To encourage each group, performance data was tracked daily and published on a regular basis, and peer groups were established to help employees interact with and learn from one another. Minimum thresholds were established, and as individuals or groups began to exceed goals, rewards were given in recognition. “We introduced the program to manager-level employees first because we wanted to make sure we had a buy-in from the people who were responsible for implementing it,” Prisby said. Twelve months after the program was introduced, the organization had changed out 10 of its 20 branch office managers. “The program helped us recognize many of the factors that negatively influenced daily operations,” Prisby said. “Today, as a whole, the organization is much more customer-centric.” Just the beginning Early in the game, in December 2007, Prisby and his team brought in senior credit experts to help identify non-performing loans and assets and restructure inefficient processes. Four months later, a new head of overall lending was hired, and he brought six lenders with him. “These were people who had proven track records who he had worked with throughout the years, so we were confident in their abilities,” Prisby said. “A similar situation occurred on the credit side. We essentially rebuilt the entire staff. It was a pretty dramatic shift.” The introduction of a new staff also allowed Prisby and his team to build an environment that encouraged team work. “Before, loan officers and branch managers rarely spoke to each other,” he said. “That has changed completely. There is a real team effort present throughout the organization because everyone is working to fulfill the same expectations.” During the last three quarters, CFB has seen its efforts rewarded in the form of improved numbers in several categories, including core deposits, commercial and industrial lending, and commercial real estate. Although the numbers don’t represent where organization would like to be, Prisby said he’s satisfied with the progress, considering the current economic climate. “The economy has affected our numbers, just like it has affected everyone else’s, but the situation has also put us in better situation, in some regard, because bigger banks have withdrawn from the market in recent months,” Prisby said, noting that CFB’s 15 new loan officers all transferred from significantly larger institutions. Despite its long history, CFB has remained a regional operation, but its team does hope to expand in the coming years. Today, with 300 employees and $60 million annual revenue, the bank has 22 active branch locations across Indiana and Illinois. In October, a location is set to open in Saint John, Ind. “We also have three sites on hold right now,” Prisby said. “We’re waiting to see a rebound in the economy, and then we’ll probably begin to expand more into Northeast Illinois. A more cohesive system needs to develop in that area. We acquired a company in 1998 to pick up the Illinois locations, but they’re spread all over the area, so there are holes.” |