Branch Incentive Programs Have Measurable Effect on Bottom Line

Tyndall FCU’s performance-based culture has resulted in a dramatic increase in sales productivity, teller transitions and a $1 million cost savings in less than two years.


Managers have long known that employee incentive programs can boost employee morale and increase group cohesion. The benefit of these programs need not end there. Employee incentive programs can also have a measurable effect on a credit union’s bottom line.

Tyndall Federal Credit Union ($844M in Panama City, FL) implemented their "performance-based culture" in 2005. Tyndall was hoping that the implementation of this employee incentive program would help increase employee efficiency, throughput, and member satisfaction. They strove to develop an incentive program with clear goals that reward employees who exceeded performance benchmarks.

The results of Tyndall’s incentive program became evident quite quickly. By rewarding tellers using individual and group measures, Tyndall was able to increase their number of transactions per hour. This increase led Tyndall to become one of the top ranked credit unions based on their cost per transaction, which currently averages 69 cents.

In its first full year, 2006, Tyndall’s incentive program resulted in:

  • A $46 million increase in loans (an 8.9% growth)
  • Higher efficiency, requiring 30 less full-time employees
  • A $1 million reduction in total personnel cost

By setting clear, fair, and consistent goals for the employee incentive program, Tyndall employees provided higher throughput and maintained customer service levels. From a manager’s viewpoint Tyndall was able to use the service comparisons to see where employee training needed to be strengthened and to allocate employees based on volume at specific branches and during specific time periods.

How have the tellers responded to this program? In the past tellers shied away from working in the busier branches or during heavily trafficked lunch hours. Now, according to HR manager Philippe Asselin, those are the most highly sought after positions.




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 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.