Top 6 Steps to Increase Workforce Utilization With Special Guests From IH Mississippi Valley CU

Incentive Pay and Branch Culture With Special Guests From Scott Credit Union & Century National Bank

• Welcome and Introductions

• Current State of the Retail Branch Network

• What Are Teller Productivity Incentives?

• FMSI Incentive Program Study

• A Closer Look – Scott Credit Union

• A Closer Look – Century National Bank

• Review Steps to Take for A Successful Incentive Program

• Open discussion Including Q&A Session

• Gordon A. Williams IV, FMSI EVP Business Development

• Steve Stryker, Scott Credit Union Chief Operating Officer

• Christina Hahs, Scott Credit Union Branch Operations Mgr

• Terri Sidwell, Century National Bank AVP/ Group Leader

• W. Michael Scott, FMSI President/CEO

• Chad Davis, FMSI VP of Marketing

Industry Branch Teller Transactions (thousands) - 41.9% Decrease

Industry Teller Productivity - 15.2% Decrease

Cost Per Transaction Trend - 100% Increase

Teller productivity incentives are variable compensation programs utilized by institutions to drive desirable behavior on the teller line.

• Productivity goals based on branch transaction volumes

• Can be for individual and team

• Common to tie service and accuracy metrics to payouts

Individual and Team Payouts

Transaction per Hour Comparison

Transactions per hour (TPH) is the total monetary transaction volume as reported by the core processor divided by total number of processing hours.

Labor Cost per Transaction Comparison is the average labor processing expense, per transaction on the teller line.

The following incentive plan implementation trend chart is from an actual FMSI client. We have removed the name of the institution for privacy reasons.

Consider how incentive programs impact your branch culture. • Improve employee morale • Stronger teamwork • Focus reduces errors • Better account holder service

Incentives allow high performers to shine • Engaged employees have stronger sales • Pay closer attention to management’s direction • Job enrichment • Less turnover

$850 million in assets, has 15 locations in Illinois.

• Steve Stryker - Chief Operating Officer • Christina Hahs - Branch Operations Manager

Client since January 2008

Rolled out incentive plan nine months after TMS started

• Created unity and support in the branches • Increased productivity and efficiency • Seasoned teller adoption

Details of Their Incentive Plan

By the Numbers

• Top performing tellers earn $200 extra per month in incentive dollars.

• Payout a total of $2,000 per month on average (institution wide).

By the Numbers

December 2011 Productivity Numbers: • TPH 17.4 (#49 out of 104 on FMSI Monthly Ranking Report) • Labor Cost Per Transaction $0.88 (#47 out of 104 rankings

on FMSI Monthly Ranking Report)

Best Practices

• Continually reinforce the new scheduling approach to your front-line staff.

• During your periodic institution employee meetings, recognize your top performing tellers.

• Promote to tellers that they have the potential to increase their hourly pay by $1.

$670 million in assets, has 14 locations in Ohio.

• Recording from Terri Sidwell, AVP/ Group Leader at Century National Bank

Client since October 2005

Encourages tellers to process transactions more quickly, accurately, and efficiently

• Provides clear cut goals • Gives our tellers something to be proud of • Promote a team environment • Keeps our workforce optimization initiative top of mind

The Details of our Incentive Plan

Individual Payouts

Team Payouts

The Details of our Incentive Plan (cont.)

• Must have a workforce utilization above 75% • Tellers must have a balanced cash drawer within $50

(net difference). • Employees who prepare the schedules receive a $50

bonus • Tellers who participate in the floater teller program earn

$10 per day.

By the Numbers

• Tellers typically earn $40-$50 extra per month in incentive dollars.

• On average, Century’s Incentive Plan pays out $1,500-$1,900 per month(institution wide).

• 75% of tellers earn some sort of incentive every month.

IMAGE OF TOP 10 Ranking – Marketing Image

Establish an ongoing workforce optimization culture and develop the reports and enhanced scheduling to support it.

Run the workforce optimization initiative for six months to a year to solidly establish the culture and program

• Will you use an individual, team, or combined approach? • Establish the payout details and make sure to include

managers and supervisors in these stages to get their buy in.

Have a roll-out meeting and clearly communicate the details of the program to your branch managers who can then disseminate this information to their team.

Have ongoing reviews to ensure the program is producing desired results. Make adjustments as appropriate.

With the power of four basic management principles:

• Feedback

• Accountability

• Recognition

• Reward

An incentive plan empowers your institution to drive away any line management resistance towards a successful workforce optimization program.

FMSI clients utilizing incentive programs have greater rates of return than those that do not (159% ROI as an example).

Image of good service (ladies on image of FMSI video cover)…IF THIS IS FOR ME…I AM NOT FAMILIAR WITH THE IMAGE YOU ARE REFERRING TO

• It is now more important than ever for bank and credit union management to pay closer attention to their staffing levels.

• Labor cost savings associated with a focused and dedicated workforce optimization program for teller-lines has become too great to ignore. • Utilize comparative performance data/benchmarking of other FIs to see how you compare.

Average Labor Cost per Transaction – Consisting of Nationwide Financial Institutions of All Sizes

Financial institutions that implement an initiative that

helps them validate and manage teller labor costs – will achieve great indefinite cost savings.

FMSI has assisted over 600 financial institutions nationwide in optimizing their branch networks through applying Actionable

business intelligence from the analysis of transaction data.

– Learn more at www.fmsi.com, or call 770.619.3443