June 18, 2007


  • Although incentive programs can be effective in reaching short-term product and financial targets, too often such programs actually encourage and reward the wrong behavior, masked by financial results. Employees not interested in serving members as tellers who now see them as a source for $$ should be viewed with concern, not as an indication of success.
    Elizabeth Hayes, Affinity Plus FCU
  • This is a perfect example of how credit unions need to evolve their out-date thought processes and focus on product and branch profitabiltiy. Deeper penetration into the market and existing customer wallet, will help do this. We aren''t used car salesmen, selling lemons to unwary customers. Incentive programs, yes, will lead to more enthusuastic sales tactics, but as long as the training is there to support the tactics it doesn''t have to be offensive to customers. The idea isn''t to sell an unsecured loan to a customer who needs an HE loan...but sell deeper into the pockets of the customers we have, with products that fit their needs. Most customers of community credit unions have a minority share of their wallet at the credit union. Customers will actually be impressed the person took time to look at their individual needs and is versed enough in financial management to offer various alternatives to them that could help them. Like rolling card or car debt into a HE loan, or getting into a savings product for that trip, but their rolling CDs into a money market for those upcoming school bills next year. That is what most people need and will appreciate...financial advice. Banks have successfully existed, and helped the public (with profit motive), w/ just this "sales culture" for many years for a reason. We don''t have to deny our need to penetrate our customer base, and become more profitable and effiecient, as the additional income can be used for all members. So I say SELL, SELL, SELL! If you don''t people will do the business at your competition who is; but I want my credit union profitable and effecient, so they can improve my experience over the long term: put a branches closer to my house, or pay me a dividend of $500 every year.
    Michael Garrett
  • Great comments, and I agree that incentives do not always work in all situations. Elizabeth, what do you recommend as a solution to the problem of lower morale and productivity, as well as high turnover in high volume locations? That seems to be a common thread in many places.
  • What were the incentives that were employed to get this response?
  • Sure would like a more in-depth follow-up article that details more of the nuts and bolts of this incentive program and the management issues around it.