August 2021

Use These 4 Success Factors When Planning for Your Lending Transformation

Transforming your lending business sounds like an aspirational goal. Who doesn’t want to enable faster credit decisions, a radically improved customer experience, significant cost reductions, and enhanced auditability? Let’s get started!

Not so fast. The reality is, transforming your lending business is exceptionally challenging and your organization will meet several bumps in the road to reaching your objectives. Unfortunately, sub-par results are far too common for digital transformation initiatives. Research has shown that over 70% of large-scale change initiatives fail to achieve their stated objectives.(1)

As you contemplate a lending transformation journey, you must understand and embrace these four key considerations.

Successful transformation projects need a clear impetus for change, driven by growth, regulatory, or competitive pressures. Whatever the cause, this impetus must be recognized and understood by all stakeholders. The project must be built on addressing a foundational challenge or opportunity for the business.

Define your vision. The vision may evolve over time – but the goals and “next step(s) in your journey” need to be captured and mutually agreed upon by key leaders and team members – particularly those in the trenches living this effort each and every day.

While defining your vision, use descriptive and tangible words that are realistic for your team to accomplish:

  • “We will provide a world-class customer experience” is more realistic when stated as “We will provide a best-in-class user experience by reducing our time to decision by 50% and our time to cash by 35%.”
  • “Drive operational efficiency throughout our lending operations” is more actionable when stated as “Optimize our lending operations by achieving a 25% compression in the end-to-end loan life cycle and reducing our cost-per-loan by 30% before 03/31/22.”

For any hope of success, you MUST resource the transformation appropriately – this includes time, people (both number and skillset), tools (viable solutions), and capital.

Finally, execution and accountability must be clearly defined and driven daily – think strategically and execute tactically. It’s a marathon, not a sprint, as they say.

These principles are easy to understand yet exceedingly difficult to implement. While implementing a new system (or endeavoring upon a transformation), business can’t be disrupted. This is the challenge for any lending organization that must dedicate time to mining new prospects, managing a live portfolio, and architecting their next steps to stay in front of their competitors. With the right team, a defined vision, and necessary support in place, you can pivot your organization and begin realizing your goals.

Using the Right Solutions Bring About the Best Results

Digitizing the loan process transforms organizations. Rulesware has a wealth of experience working with financial institutions to bring about real change with its LoanExpediter solution, which enables you to digitally manage the collection of appropriate loan content and streamline the associated loan fulfillment processes.

LoanExpediter supplements your existing loan origination and servicing systems, communicating with them through every step of the fulfillment process. The solution reduces complexity and duplication, as well as manual processing and communication and can ingest information from the 30+ documents that may be required for a loan and index and classify them based on your requirements.

It’s more than a document management system. With guided processing, the solution enables compliant production for every loan. It enables more timely and accurate quality control for Second Line of Defense activities with embedded intelligence and supports exception handling for audit review.

LoanExpediter™ offers automated routing, tracking and notifications for rapid data verification, loan review, and approvals, and the electronic checklists facilitate audit and compliance requirements.

Don’t be one that falls into the 70% of failures category. Begin your digital transformation journey with a solid plan and the right solution that will help bring your vision to life.

Author: Brent Baiotto, Executive VP at Integrated Holistic Services and business transformation leader who has led multiple business transformation initiatives for major financial service organizations. (1)