Change management experts recently discovered something that seems like a no-brainer, but is a powerful reminder of what drives successful change. Their research found that 94 percent of respondents who rated the effectiveness of change management as “excellent” met or exceeded the expectations of their change management project.
For lending teams, these results cement the idea that change is what you make of it. A half-hearted embrace of (or resistance to) change management can prolong the process and make you wish your team had stuck with the old processes. That attitude often prevents lenders from attempting something new, even if the change can make their team more efficient.
Change management should not be a kicking-and-screaming proposition, but rather, an opportunity. Here are five tips to seamlessly handle change within your lending team:
1. Embrace change management.
The mortgage industry is always evolving, but the pace of change has rapidly increased this decade. A traditional lender’s competition isn’t just a bad housing market; it includes many non-bank lenders. These changes in the industry are an opportunity for companies in banking and lending to develop new initiatives that will help them adapt.
A better strategy is to think of change management as proactive—how does this new technology, best practice, market condition, or innovation benefit your operation rather than constrain it? Staying positive about inevitable change can make it less of a struggle to overcome.
2. Value your employees.
Turnover is a huge issue in the mortgage industry. One source estimates that just 10-25 percent of loan officers who entered the business in the previous two decades lasted more than two years. In the coming decades, the industry will need 200,000 more professionals. Turnover is expensive and inefficient, but many lenders accept it as an unfortunate fact of the industry instead of taking steps to recruit great loan officers and keep them engaged and happy so they don’t leave.
Your team is made up of people with personal and career goals; treating them as commodities instead of a pivotal part of your success (and of the borrower experience) is a sure way to send them toward another job or vocation. Give them the tools to succeed, value them, and treat them with the respect they deserve, and they will be not only be less likely to leave, but also key allies in implementing your change management initiatives.
3. Emphasize training.
Along similar lines, training is essential to both retaining employees and deftly handling change when it occurs. In the post-crash landscape, loan professionals must be good at more than sales—compliance and technology skills are often essential. Without enough training, your team members can become flustered with aspects of their job they aren’t proficient in or don’t feel confident handling.
Learning opportunities beyond training on key systems allow loan professionals to expand their skill set and better serve borrowers. Moreover, learning and development opportunities are powerful ways to attract top talent and invest in the success of your current employees.
4. Stay up-to-date with technology.
Change management can be most daunting when loan origination technology evolves but lending operations are hesitant to evolve along with it. A new system requires more training, risks costly downtime, creates anxiety over compliance, and otherwise feels disruptive in an industry that doesn’t like disruption. Moreover, a financial institution that seemingly just invested in LOS technology may be hesitant to shell out more money for another system—even if the current LOS is years old and cost-inefficient. But the change to better software doesn’t need to be painful and can save money in the long run. A great solution is easy to implement, can integrate with other systems, and intuitive to learn. The challenge, of course, is getting all stakeholders to buy into the reality that this is best for the organization. Be sure to show the value of implementing the new technology, both for ROI and an improved customer experience.
5. Work with a great partner.
Change initiatives can be beneficial when lenders approach them thoughtfully and enthusiastically. And change management isn’t something you must handle on your own—a quality technology provider can often offer the support necessary to help achieve impressive results with its solution. The best partners deliver consistent, expert training that helps your team use the software in the context of your organization’s needs.
Such a vendor is also on top of the latest industry developments and innovations so that its solution is constantly upgradable and scalable. In these ways, a technology partner truly becomes a partner—one that you won’t need to change as the years pass.