PAO—process analysis and optimization—is a response to a credit union’s focus on internal operations that consume too much staff time and limit staff involvement in more productive activities. In some ways, PAO is a final step in streamlining a credit union’s entire approach to financial services.
“PAO is a revolutionary process that teaches credit unions to look at every touch point and see what you can do more efficiently,” says Paul Robert, chief consulting officer at FI Strategies, a CUNA consulting partner. “It has both an internal and external perspective: Is everything being done to run internal matters as efficiently as possible? What can we do better in our relationships with members?”
Credit unions often turn to PAO after hearing staff lament that paperwork and data entry tasks leave little time to concentrate on sales and service. “I used to think that ‘I don’t have time to sell’ was an excuse for poor performance,” says Robert.
But then he saw sales performance improve after the introduction of PAO. “Salespeople love anything that helps them have more time to spend with members,” he says. “That’s why many of our credit union clients will ask us to address salespeople’s needs first.”
For instance, one client evaluated its steps to increase sales revenue and found one in particular that needed improvement because it took too much time to complete.
“Through PAO, they were able to squeeze out an additional 20 minutes daily for their salespeople—enough time to process a new loan,” Robert says. “Say you can generate one extra $10,000 loan on each of 300 business days per year. You’ve generated an extra $3 million in new loans.”
The approach third-party PAO consultants take when working with a new credit union client varies. For Mark A. Roe, national sales director, performance enhancement group, at John M. Floyd and Associates (JMFA), a CUNA Strategic Services alliance provider, the task involves five steps:
1. Perform preliminary analysis. The JMFA team conducts a preliminary analysis of the credit union. This includes signing nondisclosure agreements.
JMFA’s analytical team then looks at all of the unpublished and published data. The client receives a local and national comparison of the credit union’s performance versus
2. Conduct onsite visit. The team goes onsite and spends a week with the credit union to validate its offsite analysis of the client’s performance.
3. Meet with management to discuss findings.
4. Explain results. JMFA’s team offers projected dollar amount increases from changes in the credit union’s processes and procedures.
5. Begin focus groups. With reliable data in hand, the team starts the EMBoS (eliminate, modify, build on, start) Protocol. JMFA divides credit union staff into 10- to 20-person focus groups. Direct supervisors of individuals in the focus groups aren’t included.
“We ask one simple question,” Roe says. “If you were CEO for one day, what changes would you make? About 70% of all the suggestions we hear at an EMBoS session make it into the summary we give to management.”
Robert says FI Strategies categorizes answers and prioritizes responses to discover inhibitors to success. “We hear a lot about paperwork—endlessly filling in fields that ask for the same information and signatures over and over,” he says. “We’re still a paper-heavy industry.”
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