The average high street bank could increase sales by £65 million per year by improving employee satisfaction by just 10 per cent, according to new research by International Survey Research (ISR). And almost half of the 43,000 people surveyed said that poor leadership was adversely affecting their organisation’s performance.
The report, Achieving High Performance in Retail Banking, is the first investigation into the impact the attitudes of employees working in high street banks have on financial performance.
The attitude of over 43,000 people working in branches and the performance of 2,111 branches in the UK and the Republic of Ireland are included in the research. The data was drawn from ISR's work with clients in the retail banking sector.
The results show that when people are committed to a bank they can feel proud of, which has a motivating environment, good leadership and team working, sales will increase significantly and costs will be reduced.
“Leadership is an area that is really letting organisations down when it comes to employee commitment,” said Steve Young, Project Director at ISR. “While a quarter of employees blamed either a bad working climate or low work enablers, a half blamed poor leadership.”
According to the research, employees who view their branch favourably actively sell because they are committed to helping the bank succeed. They are more likely to be proud of the products and services on offer and persuade customers to buy more from their branch. Traditionally high street banks have focused on customer satisfaction and service, in the hope that satisfied customers automatically purchase new products and services.
Branches that improve employee satisfaction also see a reduction in annual costs. People take fewer days off sick and branches can see a drop of up to 14 per cent in rates of absenteeism. Employees are also less likely to resign, which results in lower recruitment and replacement training costs.
Despite the rise of internet banking, the majority of the UK's 23 million account holders still regularly use their local high street bank branch. The attitude of employees in branches has a significant impact on customer purchasing behaviour. The research shows that if retail banks are to retain the loyalty of their customers they need to enhance the commitment of their staff.
"This work demonstrates the impact employees have on the bottom line of a business,” Steve Young added. “By improving the quality of their leadership, by investing in training, and by fostering a healthy branch climate, retail banks can significantly reduce their costs and dramatically improve their sales. Superior branch performance is impossible without committed employees.”
For press enquiries: please contact Elizabeth Marshall, ISR, 020 7203 6791 or mobile 07796 697593.