Last week, Jeff Bezos released his final shareholder letter as CEO of Amazon. His yearly shareholder letters are always worth reading because Bezos often provides important business insights that are meaningful for other companies and their employees. In the most recent letter, he reflected, “If you want to be successful in business (in life, actually), you have to create more than you consume. Your goal should be to create value for everyone you interact with. Any business that doesn’t create value for those it touches, even if it appears successful on the surface, isn’t long for this world. It’s on the way out.”
Every mortgage banking manager and employee has heard some version of this sentiment at some point during their careers but executing this concept is difficult and rarely done consistently, much less on a long-term basis.
While value creation can be defined in many ways, I think billionaire entrepreneur Peter Theil described it best as “doing something someone else is not doing to solve a problem.” Theil’s observation is on point because the underlying premise is all about skills and processes.
In mortgage banking, the winners invariably are those who are always upgrading their skills to deliver a better customer experience or process for borrowers. Simply put, these lenders and originators adopt new techniques and make changes when the result is a better customer interaction.
The reality is that upgrading skills and processes is all about investing time and money to get better. Just spending money isn’t enough. Similarly, while spending time is a good first step, it might not improve results if training is focused on the wrong issue.
Our industry is flooded with one-trick ponies and quick success stories but many of these companies and producers never achieve long-term success. As I have mentioned in previous blogs, success follows an S-curve trajectory. Both success and failure are part of the journey. At different points on the S curve, originators and lenders will need to recalibrate. This can require learning new skills or changing a selling process that worked for years but is now outdated and no longer relevant in today’s marketplace.
Making changes isn’t easy. It is not unlike learning a golf swing, where golfers will have a lot of bad shots before they find the correct swing path. Even professional golfers must adjust their techniques if they want to win over the course of their careers. It takes patience, practice and investment in getting the right coach.
Selecting the easier path has consequences. In my sales training courses, I often hear a myriad of excuses for why a student doesn’t want or need to learn something new. Even when lenders invest in training, some originators fail to show up or put any effort into getting better. More often than not, these originators are the first to complain about pricing and inadequate personal income when the market shifts.
What is the solution for managers? It is clear to me that during the hiring process, managers must not only determine sales candidates’ product knowledge, sales talent and experience but their interest in learning and upgrading their skills. This can be done through interview questions and quality pre-hire assessments.
If you think that the last five years have been a wild ride in mortgage lending, the next few years promise to be just as volatile. Some lenders and originators will not survive because they refuse to create value for all of their stakeholders — from investors to employees to customers.
Are your originators committed to learning new sales techniques and improving their skills?