A Matter of Time for Small Business Bankers
How can small business bankers become more productive? For many, the answer is to use their time more effectively. Time is a scarce resource that is often taken for granted. Bankers react to time, rather than planning their time. Days and weeks fly by in a flurry of activity, a barrage of emails and an onslaught of unanswered phone calls. Urgency takes the place of reflection. Speed takes the place of prudence.
And through all this intensity of activity, time remains constant. It cannot be stretched or slowed down. Time cannot be banked, borrowed or bought.
So where does all the time go? Since 1990, our consulting company has conducted time studies of knowledge workers. The data is gathered by employees who use a TimeCorder, a portable electronic device, to easily track their time on a number of pre-coded activities. At the start of each new activity, the employee presses a button and time starts recording on that activity, like a stopwatch. When a switch to another activity occurs, the press of another button stops recording on one activity and starts on the next. The device is easy to use and the results are anonymous, so participation reaches a remarkable 94%.
Our database consists of over 440,000 hours of data from thousands of participants. For this report, we focus on data gathered from small business and commercial bankers.
WEEKLY DATA The chartbelow shows total work hours, including work done at the office, at clients’ locations and at home. Business travel and breaks during the day are included, though commuting time is not.
Knowledge workers often complain about long work hours. As it turns out, bankers’ hours are not unreasonably long. Averaging 45.4 hours per week, their total is about an hour lower than other knowledge workers, who typically work 46.6 hours per week. PLANNING Successful results begin with thorough planning, representing 3.1 hours per week, or 7% of the time in the pie chart above. Planning is where one takes a deep breath, exhales, closes the door and lets the world go to make time for thoughtfully thinking about clients, prospects, and what steps are needed to either deepen a relationship or bring one in.
Planning includes territory planning to examine economic trends and determine how they affect the local area. What kinds of businesses are flourishing? Where are the opportunities for growth?
Planning includes daily scheduling, usually done early in the morning. This is the time for turning long-term into daily priorities. What must get done today? Planning is also preparation for client visits. What is the current status of the prospect or account?
All of these take time. And those who plan more create more time for selling. But too much planning becomes counter-productive. The sweet spot for daily planning, one of the activities within this group is 2 to 3 hours per week, or 24 to 36 minutes per day. But once daily planning surpasses 3 hours per week, it rarely results in more sales results – just lots of squiggles, mind maps and back of the envelope to-do lists.
SELLING With plans in hand, bankers meet with prospects and clients to increase their business. This is selling – finding, cultivating, and maintaining relationships while gathering information and proposing solutions. Activities in this category include marketing, direct sales calls, telephone calls, and networking events.
On average, these add up to 9.1 hours per week, or just 20% of the workweek. Typically, bankers make 17 sales contacts per week, or just over 3 per day. This is only half of the number made by sales representatives handling industrial products, who average 35 contacts per week.
With overall selling time representing just a small part of the day, how can bankers increase their time in this area? For one large financial institution, we examined successful bankers and compared them to those who were less successful.
Successful bankers spend about 2 hours more per week on planning, selling, and customer administration combined. In the selling category, they engage in 8.6 sales meetings per week versus 8.2 for less successful bankers. Of these, successful bankers meet 4 new prospects per week to just 3 for less successful bankers. The balance of sales meetings are those held with existing customers. More importantly, successful bankers’ sales meetings with prospects are significantly longer, averaging 56 minutes each to just 43 minutes for less successful bankers. Thus, spending more time on “know your customer” (KYA) activities is critical. Customers want a banking relationship with people who invest the time to get to know them.
CLIENT ADMINISTRATION Client administration takes up the largest amount of time for small business bankers. Essentially, these activities are done behind the scenes to ensure that a client’s accounts, loans and investments are set up and maintained.
The entire category accounts for 10.2 hours per week, or 22% of the time. That’s 2 hours per day! Within this, processing commercial loans takes up about half the time. The other half includes account set up, annual review updates, credit administration, compliance, adding funds, and merchant services.
The challenge for bankers is to delegate; automate; or, in some cases, eliminate these activities. But these have to be done, and usually the frontline account manager is the person who is closest to the account and most knowledgeable.
Thus it is difficult for an individual to minimize his or her time on these activities. Instead, these activities are the low hanging fruit that are ripe for organizational improvement – structural initiatives such as outsourcing, automation, or delegation to a back office.
SERVICE Once a client is on board, the banker is responsible for delivering customer service. He or she does this through annual reviews, cash management services, exception funding, account maintenance, and problem resolution.
Total client service time averages 4.0 hours per week, or about 48 minutes per day. Bankers need to juggle their time between servicing current clients while pursuing new business. Keeping all the balls in the air while bending over backwards to deliver exceptional service is a dexterous feat worthy of the best Cirque du Soleil performer. The smart bankers do both together. They find opportunities to probe for additional needs while responding to queries.
Bankers know that they need to deliver good service. But when we’ve asked them about their productivity inhibitors, dealing with customer inquiries and complaints emerges as the second most popular response, next to paperwork. This is a perplexing irony. Service is viewed as a priority and a hindrance at the same time.
To achieve efficiency in this category, successful bankers delegate many of their service activities while remaining as the main contact point for the customer. Automation can help, but it may be time to bring back the secretaries – skilled assistants to handle routine service tasks.
MEETINGS Few employees are fond of meetings, but there is no better way to collaborate, solve problems, and share information. Unfortunately, meetings are also where grand standing, hidden agendas, predictable power plays and petty positioning are prevalent.
Internal meetings consume 2.8 hours each week, including team meetings, one-on-one chats with managers and collegial confabulations, a phrase as excessive in syllables as most meetings are.
While meetings are frustrating, they are easily fixable by anyone sensible enough to ask that they start on time, finish on time, have an agenda and clarify agreements. The average meeting length is 53 minutes. Shave a few minutes off that and there will be more time for higher priorities. The fixes are simple and don’t require apps, web sites, or smart phones - just common sense. You can’t brainstorm with just 140 characters and you certainly can’t plan a sales campaign by pinning a picture of your favorite luggage accessory with one of your 4, 326 friends to whom you’ve just given a like.
GENERAL ADMINISTRATION Administrative activities do not generate revenue but are a necessary part of the job. They include paperwork, filing, report preparation, handling mail, internal phone calls, correspondence, and professional reading.
Together, these are a huge time hog. On average, the category consumes 7.6 hours per week, or 17 percent of the time. Put in perspective, bankers spend almost as much time doing administration as they do selling.
Not surprisingly, when asked “What gets in the way of your productivity?” commercial bankers cite administration and paperwork the most often. Successful account managers find ways to minimize these administrative requirements. They delegate them, they automate them, they batch them, and sometimes they simply ignore them!
Reports are a component of administration time, but many bankers wonder why so many are required by corporate bureaucracies that are fixated on measuring everything. This obsession produces tracking systems, measuring requirements, and call reports. These are huge time hogs that interfere with or actually run counter to the achievement of increased revenue.
Another activity within the administration category is personal training. Commercial lenders need to learn about new products or upgrade their software knowledge. They spend 0.9 hours per week on this activity. Other employees in our database spend about the same time in training, 1.1 hours per week.
TRAVEL Travel activities are very low, just 2.2 hours per week. For comparison, outside sales representatives spend a much bigger chunk of their time travelling, 6.7 hours per week. In financial services, prospects and customers usually come to the bankers. This raises the question of where their meetings should be held – at their own premises where they have access to the best financial knowledge and products, or at the customer’s premises, where business comes alive. Are bankers better off waiting in their office for customers to drop by? Or should they go out to meet for coffee, lunch, or a tour of the customer’s operations? In the world of sales, office-bound reps usually come under fire for not getting out more often.
MISCELLANEOUS TIME Breaks, lunch and personal business equate to 3.3 hours per week, just 40 minutes per day to grab a bite, call the daycare, and catch up on basketball scores. Not to mention the unmentionable washroom time. Employees in other industries spend an hour more per week on personal time. Evidently, basketball scores are of greater interest to them.
Miscellaneous time is a small but significant amount. Bankers cannot fill all of their time with high priorities; there will always be unexpected duties that take up the day; charity work, a special task force, dealing with computer glitches, or wrestling with an uncooperative photocopier that woke up on the wrong side of the bed. The less time spent here, the better. DIFFERENCES VERSUS IDEAL We can examine time expenditures versus a number of benchmarks. One of these is a set of ideal expectations, recently provided by banking industry experts at a Small Business Banking Conference. Experts were asked to provide their ideal estimates for a business banker’s time on the major categories of activities.
The overall ideal is about an hour more than actual hours; 46.8 for ideal versus 45.4 for actual. So expectations are not unreasonable.
However, actual times fall far short of ideals on the most important categories on the left side of the chart; planning, selling, and service time. These deficits are offset by surpluses versus ideal on customer administration, general administration, and meetings. Clearly, there is a gap that needs to be understood, and then managed. Time indeed is money, and needs to be maximized.
TIME MATTERS When it comes to time, keep in mind the law of small things; “Nothing adds up to much, but everything adds up to a lot.” In other words, little bits of time here and there appear to be inconsequential. That extra request from head office for a report can be done in a jiffy; it won’t be much of an imposition. But all those small requests add up to a tremendous tsunami of time.
This means that small business and commercial bankers need to make every effort to spend their time wisely. They need to plan, delegate, communicate, and operate with a view to maximizing time on their highest priority activities. And the organization needs to pursue corporate initiatives to relieve some of the time pressure through centralization, process improvement, automation, administrative assistance, and outsourcing.
Time is a resource that has a profound impact on results. Aim for the best use of time. Spend your time on what matters most.