To implement the federation business model, action is required in four areas:
People: Hiring, training, and certification of front-line employees; significantly improving branch management; making major modifications to incentives.
Internal Benchmarking: Understanding branch performance; aligning to micromarkets; increasing readiness for change.
Geographic Specialization: Determining local resource needs and establishing a sales focus based on demographics, purchasing behavior, and the local growth trajectory.
Structure: Establishing mechanisms to coordinate local versus central decision rights; refining roles and responsibilities within the branch network.
The days of the branch bank as we’ve known it are over. But something better is emerging. In creating a multiproduct, multichannel federation, retail banks have an opportunity to provide greater value to their customers and to make branch banking a profitable, winning strategy.
Paul Kocourek ([email protected]) is a senior vice president with Booz Allen Hamilton in New York. He focuses on strategic transformation of companies facing changes in the competitive landscape or the regulatory environment.
Aditya Bhasin ([email protected]) is a principal with Booz Allen Hamilton based in New York. He focuses on the retail financial-services sector, most notably in the retail banking, brokerage, and mortage industries.
Paul Hyde ([email protected]) is a vice president with Booz Allen Hamilton based in the firm’s New York office. He has worked extensively in the financial-services and health-care sectors.