During my recent MBA webinar on increasing sales production, many participants raised questions about how to make loan officers more accountable. This has always been a hot topic for lenders and their managers but the issue is especially critical as we approach 2020 and the formidable challenges that lie ahead. Knowing what drives accountability and how to identify it in originators is mandatory if a sales group wants to achieve long-term success.
At the beginning of 2019, lenders seemed focused on accountability but the recent refinance boomlet has pushed the issue to the backburner. Early in the year, it was common to see originators producing just one or two loans a month, so trying to correct poor performance was a top priority. Of course, at that production level, lenders were operating at a loss.
Too often, managers think that accountability is some magic potion that will suddenly make originators become responsible for their sales actions. Others believe it is just a motivation issue. The truth is that, similar to sales talent, accountability is an attribute that is formed early in an individual’s life. Sales professionals who possess it can thrive in the right environment where accountability is reinforced.
While accountability is not genetic, studies show that managers can screen for it during the hiring process and also immediately after the candidate has been hired. If not caught during the interview, managers have an opportunity in the first 90 days to determine if the originator is accountable.
One senior manager I spoke with blamed his high turnover rate on a discussion of performance standards with originators. While the lender had weak sales results and no accountability benchmarks, originators were pretty much left to sell on their own. This situation was untenable for a number of reasons.
Certainly, it is possible that these poor performers had recognized that their gravy train would be coming to an end, but it probably wasn’t the only issue for them. Interestingly enough, another company hired these same originators which proves that there is always another lender out there who has lower hiring standards.
Oftentimes, lenders and managers believe they can force originators to be accountable. They fail to understand that accountability Is driven by originators who must be self-aware enough to change their sales behaviors. This is not something that being a nice guy manager or ruling by an iron hand will change. Originators might give lip service to making changes but if they are comfortable with what they are currently doing, they will not take action.
Accountability is about sales professionals taking responsibility for their own actions. It is no surprise that the most accountable originators are top producers who recognize their strengths and weaknesses and are continually improving their sales skills. In contrast, originators who are not accountable often blame the lender or manager for their poor performance.
What is the solution? Accountability in sales candidates can be evaluated with a structured interview process that uses behavioral-based questions. If hiring managers ask the right questions and really listen to the answers, they can determine whether an originator will be accountable or not.
Also, it is important for hiring managers to realize that just because an originator has been in the business for a long time and was once accountable, that is no guarantee that the originator will be accountable in the new position. Originators who have lapsed into a comfort zone may be resistant to learning new technology or sales techniques.
In my view, the key to having accountable originators is simple: interview better and ask the hard questions regarding accountability before bringing an employee onboard.