Every day, we are witnessing changes that many predicted would be coming to the mortgage landscape, but now they have arrived. From online loan processing to video conferencing, our industry is undergoing a fundamental shift. While it is hard to concentrate on the future when the present is so robust with refinance volume, mortgage executives are facing critical questions about the very nature of work. At a recent Fortune 500 CEO conference, a top tech CEO panel with Accenture’s Julie Sweet and Intel’s Bob Swan, noted, “We are at a point in time which is really going to be defining for our lifetimes.” Panel members added that the pandemic has ushered in “the largest behavioral change at any one time in history.”
While no one can forecast exactly how the future will play out, one thing is clear: the old ways will be replaced with innovative ideas on how to maximize our human capital. In my view, good managers will be more important than ever to a lender’s success, especially if remote working continues to dominate business life.
Whether an individual is a good manager or not hasn’t mattered as much in mortgage banking for the obvious reason that every few years, a refinance market has bailed out poor managers with heavy loan volume. Even bad managers are needed in a refinance market environment!
In our fragmented mortgage industry, a good manager has been defined as someone who produces high volume himself/herself; is a good recruiter; or both. There is rarely any discussion about whether the manager has the skill set to develop, engage, and retain the sales staff. If hiring effective managers was a top priority for lenders, high turnover rates would be lower and retention rates would be up.
Managers with mediocre skills will be detrimental to lenders moving forward considering two factors that will dramatically impact hiring and growing a sales organization. First, the labor force of experienced originators is expected to drop off the cliff by 2025 when Baby Boomers retire. Second, if remote work becomes a permanent feature, advanced managing skills will be essential for direct supervisors to deliver acceptable team results.
Remote working is not new but certainly, it has become prevalent due to COVID-19. According to FlexJobs, a career resource firm, flexible-work policies increased by 159% between 2005 and 2017. As the number of employees who work from home increases exponentially, this trend will create new challenges for managers with average or sub-par skills.
In a remote working environment, managers will have to hire self-disciplined candidates who can work on their own and like doing so. For self-starter candidates, managers will need to maintain the company culture while retaining these employees. This is hard work even for good managers.
Key Insights on Remote Working
What have companies learned about remote working? In a recent Harvard Business Review article, Microsoft Analyzed Data on its Newly Remote Workforce, Microsoft released information from a study it conducted on its own employees. Key findings include:
- The rise of the 30-minute meeting. Microsoft stated that people could no longer catch up in hallways so meetings shrank in duration but increased in number. The 60-minute meeting has been replaced by shorter but more frequent meetings.
- Managers are bearing the brunt of the shift to remote work. Senior managers are collaborating and spending more time in meetings. Managers are spending more time nurturing their connections and supporting employees. One-on-one meetings have also increased to keep employees aligned with priorities and from a need to know employees better.
- Considering the personal responsibilities employees are juggling, meeting times have also changed from morning to later in the afternoon. A new night shift has also taken root as employees use quiet time at night to catch up on work.
- The rise of virtual social meetings has also occurred to cement connections from virtual happy hours to group lunch themes. People want connection and are creative in ways to obtain it.
There is no question that the global pandemic has changed many things in business and the good news is that issues like work/life balance and maintaining employee engagement has become a higher priority. This environment demands good managers. Otherwise, a company’s success will again be dependent on the next refinance boom. A smarter strategy is to select the right individual to manage and raise his or her skills to be effective in a world where good originators have many options and suitors.