Good tidings for mortgage lenders look likely in the New Year. The Federal Reserve plans to keep interest rates near zero through the year and beyond, and the housing market is improving. Of course, a housing recovery changing gears from tepid to mild might not seem all that impressive. But mortgage lenders will find more purchase loans in the mix, prompting them to hire more loan officers, underwriters and processors in 2013.
To take advantage of these conditions and have successful year, mortgage company executives need to align their employees to their corporate goals and create a performance-driven, accountable and compliant business culture. Such a culture enhances productivity by creating a more competitive workforce, whose results can be measured and compared against industry peers.
Only business intelligence technology can provide this cultural solution for mortgage companies. Business intelligence software gives senior executives real-time access to key data indicators, which can be used to measure the real-time performance of all departments, regions, branch offices and each employee in a company. But so few mortgage companies are realizing the complete benefits of this technology and how it can be used to unleash the full potential of their employees.
Putting data into action
Business intelligence technology transforms company data into actionable information, which can then be used to mitigate losses or provide more resources and employees to the most profitable company services and products. It also brings disparate processes and employees, such as loan officers, in line with the company’s earnings and expense objectives.
Business intelligence technology does this by collecting, maintaining and organizing the data from your company and providing you with the analytical tools to drill deeper into that data in order to gain a better understanding of your employees and company performance. Business intelligence and management software also gives lenders and servicers superior risk management tools that surround and supplement their existing technology.
With its real-time reporting of employee performance, executives can quickly and efficiently identify personnel issues and correct problems before they result in significant losses. For example, business intelligence software can provide real-time quantitative measures, such as the number of loan applications per loan officer or loan processing turn-times. It also can ensure that loan officers, loan processors, underwriters and closers are communicating together in real-time and are on the same page with corporate operations, strategies and goals. This information can then be used to create and encourage a high-quality employee culture and singleness of purpose.
One version of the truth
Mortgage executives constantly receive all kinds of information about their company from many different sources, not all of them objective. Business intelligence provides financial services firms with one version of the truth in company operations. This means key executives no longer have to judge which reports on company operations are accurate. They can instantly access all relevant company information, as well as apply powerful analytics to monitor operations and forecast key business metrics, such as earnings, revenues and expenses.
The best business intelligence solutions can integrate with any existing company software system and immediately provide a real-time view of a mortgage company’s collective data, including staff performance. The software provides dashboards so that managers can view a company’s strengths and weaknesses on one screen. The data is constantly updated, so managers always have the latest, most relevant information to act on to improve productivity and company operations.
From these dashboards, key executives can view high-level company and employee data—or a summary of this data over time—then drill down into the data to identify problems, find their causes and quickly solve them. Dashboards also let top managers track the real-time performance of branches around the country and measure their performance with metrics that take into consideration the performance of their leading competitors and state regulations. So you’re always on top of the latest trends in the industry and can determine if your company and employees are taking full advantage of them.
By benchmarking performance, business intelligence technology gives your employees an understanding of how they match up in the industry and what they need to do to beat the competition. It builds a productive, entrepreneurial and sustainable business culture.
Helping managers keep score
Business intelligence systems also allow senior managers to view key performance indicators of their employees, so they can see how they stack up against fellow employees and their peers in the industry. These indicators are combined into scorecards, which constantly monitor the performance of staff and staff activity throughout the company, including all divisions, departments and individual employees.
Are small-scale activities consistent with your company’s large-scale goals? A scorecard can tell you, enabling you to analyze your employee and operational goals with actual results. Scorecards can alert users at different levels in your company when performance thresholds have or have not been reached.
Business intelligence software also eliminates much of the paper involved in a company’s reporting system. Detailed reports, including the latest financial and employee information can be viewed quickly on the computer screen without any need to print them or open new files.
Executives do not have to manually piece together reports, since all relevant information is on the screen. With instant reports, mortgage executives have the latest loans per loan officer and risk management information from around the country at their fingertips.
In a world of shifting mortgage regulations, business intelligence scorecards can help keep operational employees, particularly loan officers and underwriters, compliant. For example, managers can track in real-time the activities of every loan officer to make sure they meet all applicable industry laws and guidelines and stay in line with company rules and requirements.
Building employee accountability
In order to successfully manage many business units and your employees, you must be able to clearly see their results. Business intelligence software creates a business management platform for lenders and servicers, which delivers transparency and accountability throughout the organization. It’s like watching your employees in real-time, all from a central location. You can pinpoint any adjustments required to maintain a business culture that remains accountable.
We have learned over the years that the act of measuring employee or company operations can improve performance by around 10 percent. Measuring business flow and employee activities provide executives with the control to differentiate the performance of one area of the company from another. For example, are closings being delayed by loan officers, underwriters or processors—and which ones?
Using business intelligence technology, managers can view the performance of their entire mortgage origination team and easily make assignments to balance the workload and improve productivity and loan quality. But employees also can view their performance, too. This creates a self-competitive environment that encourages everyone to perform at his or her highest level. This not only makes your company more productive, but also improves your bottom line.
Implementing business intelligence also allows a mortgage company to equip all levels of its organization with analytical reporting, which can include alerts to top executives regarding deviations in operating goals in various departments. This system of feedback mechanisms helps improve the performance of managers, which naturally leads to better corporate decision-making and hiring. This is because business intelligence software replaces subjectivity with objectivity in management decisions.
Managing a mortgage company in a shifting regulatory environment would be extremely difficult without the constant real-time information provided by business intelligence. For example, business intelligence software can measure quantitatively the real-time costs involved in operational activities such as real estate-owned (REO) sales, short sales and loss mitigation. Management can immediately determine where cost savings can be found and employees can be more productive when they have unadulterated transparency in their operations.
A business culture that fosters employee accountability, competitiveness, compliance and productivity is best achieved with business intelligence technology. Business intelligence provides a better understanding of a company’s performance in all aspects of its operations. It delivers real-time insights necessary to maintain outstanding employee results. And it can bring disparate company operations back into line and working together.
If mortgage companies really want to capitalize on improving market conditions, using business intelligence technology to get the most out of their employees, departments and branches is the only intelligent choice.
Tyler Sherman is chief executive officer of Motivity Solutions, a business intelligence and business management technology provider. Motivity Solutions is located in Denver, Colorado. He may be reached by phone at (800) 411-5541 or e-mail [email protected]