Is That Any Way to Run A Branch? Workforce Optimization Solutions for Retail Banking

by Bob Meara, August 23, 2011
Industry Trends
North America

Abstract

Annual savings of US$20,000 to $30,000 per branch await financial institutions willing to take simple steps to improve branch channel efficiency and effectiveness.

Workforce optimization (WFO) solutions aren’t a new idea. Yet a small minority of retail financial institutions use them. This is true globally. Specifically in the US, Celent estimates that less than 450 financial institutions (about 3%) use WFO solutions to help manage the branch channel. Those that do are disproportionately larger banks.
In a new report, Is That Any Way to Run A Branch?: Workforce Optimization Solutions for Retail Banking, Celent explores the benefits of workforce optimization (WFO) solutions, likely results for prospective financial institutions, and the vendor landscape for WFO.

Celent sees rapid growth in the use of WFO in retail banking for at least three reasons.

  1. Retail banking business models are challenged with eroding revenues, placing a premium on cost reduction,particularly in the branch channel.
  2. WFO solutions, once the purview of larger organizations, are now broadly delivered as software as a service (SaaS), slashing implementation costs and removing the requirement for in-house expertise.
  3. Over the past year, WFO vendors have packaged SaaS solutions with turnkey services to further reduce solution cost and complexity. This is making WFO a relatively easy “yes” even for small financial institutions.

“Financial institutions of all sizes are under considerable pressure to both reduce costs and improve branch sales and service effectiveness,” says Bob Meara, Senior Analyst with Celent’s Banking Group and author of the report. “Yet most haven’t taken the relatively simple step of workforce optimization. Those that have are enjoying considerable efficiency gains as well as a detailed understanding of their branch channel operations.”

This report begins with a brief discussion of the “new normal” in retail banking: the factors driving the acceleration of branch channel transformation and their likely persistence. Workforce automation solutions are then defined and given context. The report presents two case studies of WFO usage to provide significant improvements in branch channel efficiency and effectiveness. It then evaluates the WFO vendor landscape, with profiles of leading WFO solution providers.

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned subsidiary of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America
Michele Pace
mpace@celent.com
Tel: +1 212 345 1366

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81 3 3500 3023

Table of Contents

Executive Summary

3

Introduction: Now Is the Time

5

A Workforce Optimization Primer

8

 

Solution Components

11

 

Getting Up and Running

13

 

Expected Results

16

 

Solution Trends

19

Getting the Most Bang for the Buck

20

 

Driving Organizational Change

20

 

Teller Automation Value Modeling

23

Case Studies in Workforce Optimization

25

 

UMB Bank

25

 

XYZ Bank

27

Vendor Landscape

31

 

FMSI

33

 

GMT Corporation

35

 

Kronos

38

 

Point Enterprises

41

 

SumTotal Systems

43

 

Verint Systems

46

Conclusion

48

Leveraging Celent’s Expertise

49

 

Support for Financial Institutions

49

 

Support for Vendors

49

Related Celent Research

50

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