With many banks facing significant competitive and economic headwinds, it is critical that they act to optimize the performance of their retail businesses.
Running a successful retail banking business is, arguably, the hardest job in financial services. The reason is straightforward: Retail banking is a highly complex and diverse business.
No other business line deals with the number and type of management challenges as retail – strategic, analytical, financial, operational, technological, risk management, regulatory compliance, facilities, marketing and, most importantly, people. Consequently, management effectiveness and excellence have always been critical elements in determining high-performing retail banking businesses.
The importance of management excellence has never been more important than it is today. The pace of change within the industry is accelerating, driven by significant shifts in consumer behavior and preferences, the continuing formation of technology-based competitors and the need to adapt to a new post-pandemic reality.
While there are many components to an effective management model, in our view the most successful approaches include the following:
- Highly focused planning.
- Clear definitions of success.
- Meaningful performance metrics.
- Accessible and actionable data.
- Rigorous talent management.
- Fast and interactive feedback.
- Team-building that celebrates success.
Creating and implementing an effective management system is, perhaps, the most important factor in determining the success or failure of most banks’ retail business lines.
With many banks now facing significant competitive and economic headwinds, it is critical that banks act to optimize the performance of their retail businesses. This means taking a hard look at current management practices, identifying specific improvement opportunities and quickly implementing program enhancements.
We suggest focusing on four key activities:
- Assess current practices clearly and objectively.
- Identify specific improvement opportunities.
- Develop training programs for management.
- Install rigorous monitoring systems.
Many elements contribute to a high-performing retail banking business – these include highly focused strategic and business planning, distinctive value propositions, and consistent and differentiated customer experience processes. And while these are all important, they are not sufficient. Ultimately, execution drives excellence and, importantly, management drives execution.
See the breakdown of the most successful approaches and more information on the four key activities to focus on – read the full article on BAI.
