It doesn’t matter how much money a bank or credit union is willing to spend on new technology if employees are unwilling – or unable – to use it. Whether it’s because of resistance to change, a lack of training, or a lack of resources, there are many obstacles to adoption that financial institutions must consider in order to get return on their investment. Achieving 100% adoption is attainable if financial institutions are willing to put the best change management practices in place.
4 Ways Financial Institutions Can Get Buy-in for Their Latest Tech Investment
How to Get Buy-in When Implementing New Technology
Achieving 100% adoption is attainable if financial institutions are willing to put the best change management practices in place.
You might also like this whitepaper, on optimizing change management.
Communicate the purpose
One of the most important pieces to garnering employee buy-in for new technology is communication. What is the purpose of the new software? How will it make employees’ jobs easier? How will this help the institution improve? Some employees may feel that their current tools and processes are satisfactory and may have an “if it’s not broke, don’t fix it” mentality. Executives should center their communication on the vision for the technology and what employees will gain from it.
“Change is hard for everybody, but if you can explain why change has to occur and how that change can eventually benefit the group overall, it may not be easy, but it becomes easier,” Rich Hoban, Director of Corporate Development at Frandsen Bank & Trust, said in a recent description of how his financial institution successfully implemented technology.
It shouldn’t just be executives communicating the vision, either. When Frandsen wanted to move to an online loan origination system, it assembled a technology selection committee with employees from all aspects of the lending process: lenders, lending associates, credit analysts, approvers, and more. Having representation from each group helped team members feel heard and fostered buy-in.
“Change is hard for everybody, but if you can explain why change has to occur and how that change can eventually benefit the group overall, it may not be easy, but it becomes easier.”
Set clear goals and expectations
Once the financial institution has communicated why it is selecting a particular software, it should also begin setting clear goals and expectations early. For Frandsen, this meant complete user adoption. To make sure that this was achieved, the bank communicated to the lending team that it would be mandatory to put all commercial and agricultural loans through the Abrigo system once all branches were adequately trained.
To make the end goal less daunting, institutions can set milestones to hit on the way to the overarching goal. Frandsen used a hub-and-spoke approach, where a team of associates was trained to be “power users,” and would go on to train other staff members. This strategy developed the internal knowledge sources prior to fully rolling out the system to all users. The associates began practicing in the system with smaller loans of $300,000 or less to get started. While each institution’s strategy and milestones will be different, it’s important to make the goals and expectations approachable to garner buy-in, especially from those that are more hesitant to big changes. People manage change best when:
- They know what is on the horizon
- They feel prepared, and
- They recognize how it will benefit them.
Provide ample training and be open to feedback
A key reason for Frandsen’s adoption success is because of its project manager. The project manager acts as the chief advocate for the solution.
Hoban recognized that there are always pockets of resistance when it comes to implementing new processes, but he noted the importance of having a strong, enthusiastic project manager that can help instill confidence in the other end users. The project manager also works with the software vendor to ensure staff receive ample training and can provide feedback to ensure the changes are understood and adopted by all.”
Frandsen Credit Analyst Josh Jansen had experience in multiple areas of the lending process, making him a particularly strong candidate to lead the project. Jansen learned the technology completely and helped to assemble the team of power users to train other branches. For Frandsen, it was important to have a vendor that could provide best practices and support internal members to provide day-to-day training.
While having a structured plan for training and implementation is critical, management must also remain open to feedback throughout the process. The hub-and-spoke approach allowed associates to test the process, provide feedback, and make adjustments before the rest of the bank’s lenders were all expected to use the new technology.
“Moving away from old methods doesn’t mean that the old method was wrong or bad, but just different,” Hoban said. Any time you’re implementing a new system or creating any type of new change, you’ve got to be communicative and be open to feedback.”
Stay committed to the big picture
Inevitably, there will be employees who will resist new technology and new processes. New software can help financial institutions tremendously, but it isn’t a silver bullet. Realizing the full value of the investment requires significant dedication and commitment from the end users. When Hoban or other management team members faced pushback or resistance to the new system, they were able to point to specific sticking points and challenges the advisors and other lenders had identified prior to implementation, and they could address how the Abrigo system alleviated those challenges.
“When we compared our numbers to peers, we knew we were fairly inefficient with our lending area from a cost standpoint. If you’re a growing bank, then you have to be adaptive,” Hoban explained. A loan origination system that automated the process from beginning to end allowed Frandsen to adapt, Hoban said, because now the same number of associates can handle more loan volume. “Abrigo allowed us to do that by having a system that could be leveraged by a fewer number of lending associates.”
If an institution is facing resistance, remind employees of the vision communicated early in the process. Keep track of metrics to show the improvement in efficiency or other key performance indicators and regularly communicate the successes the team has made throughout and post-implementation.
Any software is expensive – whether that is the upfront cost or the number of resources it takes to implement. Maximizing engagement from the people side of software is the most cost-effective way to ensure you receive a high return from your investment.