Rural branches of most banks managed at arm’s length

“Technology is here. People can bank via phone and online, but it’s important that we have someone out in the market,” says a 20-year Canadian Imperial Bank of Commerce veteran who is based in southern Saskatchewan. “It maintains the relationships, keeps people dealing with the branch and money on the books.”

A few months back, she says, her bank set up a “community cluster” system, dividing the province into five groups; her group is made up of 12 branches. The group’s general manager is based in Moosejaw, about an hour’s drive from her branch. He makes regular visits and is in constant contact by phone. “At least he’s a local presence,” she says. “He’s more accessible than having someone down East.”

Each group also has banking specialists that take care of specific needs within a given group. The bank also relies on “partners.” For example, customers with wealth-management needs are likely to get a visit from staff at TAL Global Asset Management Inc.

Branch managers seem to have pared-down roles, working more as administrators than bankers. They get backup from the community group office.

Many managers are women, the Saskatchewan banker says. The bank has trouble getting men to move with their families to rural locations. Instead, the bank promotes a local bank employee.

Despite the “distant management” approach, the banker says CIBC is more than willing to provide time for employee upgrading and courses toward new credentials such as the Certified Financial Planner designation.

But not everyone is keen on distance management.

A blow to satisfaction

One CIBC banker in southwestern Ontario says the new system has been a blow to employee satisfaction. A manager who isn’t always present can’t see what “you do right and what could be enhanced.” Instead, she says, the manager calls under two circumstances: when you do really well on the balance sheet or when you make a mistake.

After working in the industry for 30 years, the Ontario banker has seen several shifts of the service pendulum.

“Every decade it seems to sweep to the other extreme,” she says. “At one point, we’re conservative and risk-focused. The next decade, we’re liberal and flexible.”

The distant management system leans toward the former, she says, with the result being that bank managers don’t have the kind of decision-making power they once had.

“They’re caretakers. Caretakers don’t take pride in what they do. They have no say in what they do.”

The branches are short-staffed, too, the Ontario banker adds. “We’re a service industry. We must ensure there are service people in the branches. There are tellers and product salespeople, but no service people.”

Instead, she observes, banks are creating “assembly-line mentalities” and losing accountability.

Technology can create a sense of isolation, says a rural New Brunswick banker. After 20 years with Royal Bank of Canada, she has seen the full onslaught of

technology.

“Rural communities are not ready for the technology, but it is now the only option,” she says.

She sees Royal’s “reputation” as a big selling point. Replacing personal service with technology could undermine the bank’s business, she says.

“Your bank manager knew you, knew when you banked, could call you,” says the Ontario banker. But, today’s bank managers have lost their power to make decisions about an individual’s creditworthiness, she says.

“Customers aren’t loyal because we’ve made them disloyal,” she adds.

In urban centres, Canadians don’t have far to go to find a bank branch. This is not always the case in small towns and rural areas. Telephone and online banking is available across the country, but to ensure a presence in these areas, banks have kept some of their branches open and turned to “distance management” as way of maintaining the banking system.

“Technology is here. People can bank via phone and online, but it’s important that we have someone out in the market,” says a 20-year Canadian Imperial Bank of Commerce veteran who is based in southern Saskatchewan. “It maintains the relationships, keeps people dealing with the branch and money on the books.”

A few months back, she says, her bank set up a “community cluster” system, dividing the province into five groups; her group is made up of 12 branches. The group’s general manager is based in Moosejaw, about an hour’s drive from her branch. He makes regular visits and is in constant contact by phone. “At least he’s a local presence,” she says. “He’s more accessible than having someone down East.”

Each group also has banking specialists that take care of specific needs within a given group. The bank also relies on “partners.” For example, customers with wealth-management needs are likely to get a visit from staff at TAL Global Asset Management Inc.

Branch managers seem to have pared-down roles, working more as administrators than bankers. They get backup from the community group office.

Many managers are women, the Saskatchewan banker says. The bank has trouble getting men to move with their families to rural locations. Instead, the bank promotes a local bank employee.

Despite the “distant management” approach, the banker says CIBC is more than willing to provide time for employee upgrading and courses toward new credentials such as the Certified Financial Planner designation.

But not everyone is keen on distance management.

A blow to satisfaction

One CIBC banker in southwestern Ontario says the new system has been a blow to employee satisfaction. A manager who isn’t always present can’t see what “you do right and what could be enhanced.” Instead, she says, the manager calls under two circumstances: when you do really well on the balance sheet or when you make a mistake.

After working in the industry for 30 years, the Ontario banker has seen several shifts of the service pendulum.

“Every decade it seems to sweep to the other extreme,” she says. “At one point, we’re conservative and risk-focused. The next decade, we’re liberal and flexible.”

The distant management system leans toward the former, she says, with the result being that bank managers don’t have the kind of decision-making power they once had.

“They’re caretakers. Caretakers don’t take pride in what they do. They have no say in what they do.”

The branches are short-staffed, too, the Ontario banker adds. “We’re a service industry. We must ensure there are service people in the branches. There are tellers and product salespeople, but no service people.”

Instead, she observes, banks are creating “assembly-line mentalities” and losing accountability.

Technology can create a sense of isolation, says a rural New Brunswick banker. After 20 years with Royal Bank of Canada, she has seen the full onslaught of

technology.

“Rural communities are not ready for the technology, but it is now the only option,” she says.

She sees Royal’s “reputation” as a big selling point. Replacing personal service with technology could undermine the bank’s business, she says.

“Your bank manager knew you, knew when you banked, could call you,” says the Ontario banker. But, today’s bank managers have lost their power to make decisions about an individual’s creditworthiness, she says.

“Customers aren’t loyal because we’ve made them disloyal,” she adds.