Publications & Resources
March/April 2010
New Look for the Community Bank
Sustainability: The Ability to Endure Without Giving Way or Yielding
By Teri A. Rosquist
Today’s challenging economic environment has truly shown a new importance for the word “Sustainability”: the ability to endure without giving way or yielding. In the financial world, sustainability has become especially crucial as these past couple of years have presented new bank failures, increased regulations, and uncertainty among consumers.
But how can we create sustainability in an environment where there are many new challenges that we can not control?
One of the biggest weapons we have against these new challenges and shifts in the marketplace, is our ability to adapt to them. This concept reminds me of a great lesson taught by Spencer Johnson, M.D., through his book, Who Moved My Cheese?1
In his book, Johnson illustrates a valuable lesson on change. The story conveys how people easily become comfortable and reliant on their abundances in life, but when their situations shift to become less favorable, they have difficulty adapting.
When change presents itself, we are left with only two options: we can become bitter, afraid, and waste our time sulking, or, we can accept, adapt and even embrace change.
If we chose the latter and learn to easily adapt to change, we will find new opportunities that will allow us to remain sustainable even through the economic hardships.
So with this principle, we come back to the critical question:
What can community banks do, or how can they adapt and become sustainable despite the issues they have been faced with recently?
One issue that community banks can address and adapt to immediately is the abated consumer trust among the financial marketplace.
Since the financial meltdown has caused consumers to become weary, community banks must focus on rebuilding trust among both their current and prospective account holders. A way that community banks can accomplish this is by providing services that will allow customers to feel as though they have more control over their finances.
There are a few different ways community banks can allow their customers to feel more in control. However, the community banks that will really gain a competitive advantage and successfully capture consumer confidence are the ones that provide their customers with greater online capabilities.
Consumers in today’s world want more access to their financial information online, at their own convenience, with the comfort of being in control. Because most financial institutions already provide basic online banking services to customers, community banks can differentiate themselves by allowing customers to do more than just check account balances, complete money transfers, and pay bills.
Community banks can differentiate themselves by enhancing their online banking services and allowing customers to have access to copies of their financial documents online, such as statements, deposit slips, checks, loan documents, and any other documents pertinent to their account.
When customers have the ability to access copies of their financial documents whenever and wherever they chose, they begin to take on a form of ownership. Psychologically, they feel more in control of their finances because they are now able to see what is happening “behind the scenes”, or in other words, access the documents that actually support their account balances, outstanding loans, or cleared checks.
Being able to access “behind the scene” information not only creates a level of trust and loyalty between the customer and their banking provider, but it also creates “stickiness” among them. The customer begins to rely on the ability to access their financial documents online and they are less likely to change financial institutions where they may no longer have this same capability.
So even though the financial meltdown has created many new obstacles for financial institutions, providing customers with greater access to their financial information is a simple way in which community banks can rebuild consumer confidence.
Just as all living creatures must learn to adapt to the changes in their environments, so too must we. The community banks that will not only survive, but thrive through these economic upheavals are the ones that can use the changes in the financial marketplace to their advantage, and create opportunities that will allow for sustainability.
Reference: 1. Spencer Johnson, M.D. (1998). Who moved my
cheese?
Teri A. Rosquist is the Marketing Assistant of Millennial Vision, Inc. (www.mviusa.com), a leading provider of Document Management. She can be reached at 888-684-6684 or terir@mviusa.com.
Unauthorized reproduction of all or part of this material without the express written consent of the author is strictly prohibited. All rights reserved.