Transcription:
Retail Branch Builds: Today's Climate and Temperament for FI's

Bill Klaproth (Announcer): When you've been searching for the right insight, advice and information on financial marketing, you know where to go, the Speakeasy, the exclusive source for financial marketing insights, with a shot of human. Starring Kelly Hellickson and Hillary Reed from EmpowerFi, strategy infused, data-driven marketing solutions for financial institutions nationwide. And on this episode, Kelly Hellickson welcomes Mark Alguard, President and Director of Client Strategy at Momentum as they'll be talking about a people-centric approach to building strategy. Now here's your host Kelly Hellickson.

Kelly Hellickson (Host): Oh, good morning listeners and happy Friday and it happens to be a really great Friday. I'm extra sassy on Fridays, so just so you know, and we'll just preempt with that. We have a special guest with us today. We have Mark Alguard with Momentum. Mark, hello, thank you for joining.

Mark Alguard (Guest): Good morning, Kelly.

Host: How are you?

Mark: Oh, great. Like you said, it's, it's a happy Friday. I'm looking forward to a fun weekend away. So,

Host: Yeah, that's right. So you were telling us before we kind of got serious here. Where are you going this weekend?

Mark: Whidbey Island. It's a rather large island in the Puget Sound, just north of Seattle. So, it's a pretty beautiful place with lots of beaches and little towns and farms. So

Host: What's the weather like right now? It's like fifties or?

Mark: Well, I'm in Seattle, so No, it's actually dry. We're excited because it's going to be dry tonight, so we get to have a bonfire and then I think it's supposed to be pouring rain for the rest of the weekend, but yeah, we'll be inside.

Host: You'll be fine.

Mark: Yeah, no, we'll be fine. It's a beautiful place in the summer too, though. All these really kind of wide landscape vistas and the Puget Sound and the Olympic mountains and lots of nice hiking.

Host: Well, you'll have to take some pics and we'll have to have you on again, and you can tell us how it went, how drenched you get.

Mark: Yes, definitely.

Host: All right. Well, thanks for joining us today. I just want to have a, I like to call them fireside chats. I had your partner on, Jenny B. A couple months ago, and let's just give a shout out to Jenny Bengeult from Momentum. We love her. Jenny hope you're having a good Friday.

Mark: I was just going to say, yeah, Jenny, Jenny and I have been working together for a long time. In fact, we just got back late last night from San Diego. We were working with a partner down there and we were just joking about how we, we can answer questions for each other, you know, cause we, we've traveled together so long.

Host: That's what we talked about when we met at the Reach Conference a couple months ago or a month ago. That is funny because you guys are a very, very good pair. So maybe that's a great segue into, tell us about Momentum. Tell us about who Momentum is and what Momentum does, what they specialize in, what you're great at.

Mark: We're technically in really at our core, we're a design build partner for community banks and credit unions. And, when I say design build, it's really strategy. And then bringing that strategy to completion execution. So what we like to say is, you know, we help these credit unions, these community banks take their goals, their objectives, and then turn those into high-performing buildings and environments.

Host: Yeah, that's awesome. You guys do really, really good work. We can attest to that and we're excited to partner with you on some upcoming projects with some clients. I had a question earlier, and I don't think I got it answered. When we hung out at Reach, you and Jenny, are you and Jenny part owners, or how did Momentum come about?

Mark: Gosh, just about 20 years ago and we were founded by a couple of guys, Jim and Bob, one who was a civil engineer in training and a construction manager in his career. And then the other gentleman, Jim was an awesome design architect. And so they had done a lot of work with financial institutions and actually Jim was in Seattle. Bob was in Pittsburgh and they had kind of crossed paths in the industry over the years. And finally this, I think, frustrations with the traditional delivery model of designing behind a curtain, coming up with a great design and then going out and figuring how you're going to build it, how much it's going to cost you. It is just too frustrating. So they really wanted to come together and kind of integrate those two services towards a better product. So that's how we came to be. And then, Jenny and I have been employees of the firm for over a decade and about two and a half years ago, we did a structured buyout with, with another one of our colleagues, Colin Winters. So we're now kind of the three operating owners of the firm.

Host: That's great. Good. So 20 years. Okay. So that answers a lot of questions for me. Let's talk a little bit about tht behind the curtain, if you will, if you could take us behind that curtain, give us a peek. You know, you just talked about how Jim and Bob kinda came together. Were they frustrated? What were the most frustrating things that they found themselves facing? And then second to that, do you think that strategy should come first before the architect starts the layout and the landscape?

Mark: Yeah, absolutely. And I think that's one of the biggest mistakes that are made or biggest problems in design, that can occur is that you, you start to put together a building, you start to draw a building kind of based on your designer's past experience, right? What, what has worked for other clients. So what, you know, kind of is in the back of their head without really thinking enough about what is the building for, what are you trying to achieve for your business through the building? Right. So we always want to make sure that your business objectives are driving that design.

So if you don't really take the time to figure that out, it's very risky. You could just really be on heading off on the wrong path. And so, and that's, that's what we were doing in San Diego yesterday, Jenny and I. We were taking one of our partners through what we call a strategic alignment session.

So we spend about half a day with a team. And we, we do, we facilitate round table discussion and try to really get from each individual contributor on the team, you know, from their point of view, from their area of the business; what are you, what do you need from this facility? In this case, it was a contact center.

What are you trying to do for the business and then, you know, how can we get there? So we were talking about things like, for example, employee experience and wellbeing, right? In the contact center, you have lots of I think, stressful interactions with people often on the phone. And so

Host: They're calling in and they're not happy campers.

Mark: They're not happy, often, right? That's why they're calling. I mean, not always, but right. They need help. And so how do you make it so you don't have burnout on the team right, on your employee team. So your employees can deal with, you know, the stress and inevitably, you know, it's human nature that comes along with those calls. So make it easier for the staff to get up and walk around, maybe, make it so they can go outside and right after a call or even during a call. Have private areas for them to tuck into if a, if a conversation just gets a little too heated. Right. So, making sure that you can have managers or leads accessible to provide feedback.

So a lot kind of goes into that design beyond just, you know, laying out desks in conference rooms and break areas right? Now I forgot your, the first half of your question.

Host: The first question. Well, I just kind of want to, no that's okay. We're going to talk about whatever we want to talk about. We may end up talking about shoes. You never know with me, like I said, I'm sassier on Fridays. So oh, we could go on for hours, Jim and Bob, some of the frustrations, some of the main points maybe that they, you know, kind of got together. And then some of those frustrations that they eliminated for clients, I want to talk about that.

Mark: Of course. I mean, I think that the classic issue in, there's what we in the industry and I'm trying to avoid jargon, but we call it the traditional delivery model. And that's where you hire an architect, an architect designs a building, you create a set of big documents, and then you put that set of documents out to bid. Right? It's very difficult to really know, one, how much that building is going to cost until you put it out to bid. So is it within your budget requirements are not? Very difficult until you really get market bids on the project.

And two, it's hard to know really how buildable or constructable what the architect has conceived is. So I mean, they certainly have of course their professional expertise and it will be buildable, but especially in this market, do you know how much are those glass paneled walls going to cost in this market? How long is it going to take to get them? How well do they integrate with the structure you've proposed? Right? So to have a construction expert integrated into the actual planning and management of the project, it makes the projects go faster. It makes them cost less. And it, but I think almost most importantly, I think it really ensures that you get what you expected from the beginning, that the business drivers that were in your plan from the beginning, those are understood by the contractor and they don't get maybe eliminated through a value engineering process or the contractor doesn't understand how important those elements are and they may get eliminated. Right?

So we call it integration. We want to make sure that we integrate the strategy and the ideas into the plan from the very beginning. And then as a contractor, we can validate at every step of the design, permitting and construction, that those elements are still in the plan.

Host: Well, that's great. So it's basically a marriage between the contractor, civil engineer and an architect. So, that's fantastic. When we talk about organizations, right? So credit unions and community banks. Take us through the entire process. Like when do they contact you? When do you know that they need help or kind of suss some of that out for us?

Mark: Sure. I think typically when they contact us is when they, as a, as a leadership team, as a management team have decided that they have a need for a facility. So, need market growth. They're looking to place a retail location, a branch in a certain market, or, we do quite a bit of work in back office operations, the workplace.

So typically it's a realization that they're out of space, right? Or perhaps the space has just become tired and it's not really supporting the work that's going on. And that, I mean, that's the typical contact, for a new client, but when it's, once we've worked with a partner, I think they start to understand that it maybe is a little bit better to bring us in a bit earlier, to really kind of start to really even suss out the need for the facility.

So, what happens pretty often is that we'll start a relationship with one of our partners, doing retail branch delivery and we'll catch wind in one of our conversations that there's really, there's starting to be some pain points around the operations center or the workplace. And so we'll start a conversation and really want to start diving into well how much space do you have? How are you growing? Is that growth sustainable? How do your departments work together? What are you trying to have your team members do in the workplace? Right?

Host: So you guys are great about like getting all of that and gleaning all of that from one of these workshops or like one or two of these round tables is what I'm hearing.

Mark: Oh yeah, absolutely. Yeah. And a little more than a round, we start with a round table and then we do go through some exercises to really define, not just the objectives and the charter for a project, but what are the details that are going to take to deliver on that? You know, I think some people get a little scared of the consultant and their exercises and you know, that they take through load a meeting, but the feedback we've gotten though is, wow, this is, these conversations really helped us think about what our future could be, what we need. So we'll do scenario planning exercises, for example, really try to put people into a frame of mind about thinking about what's their future and what it could be.

Host: Oh, yeah. And that's honestly just like when Hill and I go into an organization and we do a marketing audit, the word audit, I just hate it. You know, we're trying to find better terminology because people look at us and they're like, what are they going to audit? What are they auditing?

Mark: Especially financial institutions.

Host: Right. Going into something you just never really know. You don't know what you don't know. So if you've never had that experience before, it is, you know, a little bit challenging and can be a little bit scary, daunting, rather like, oh my gosh, what are, what kind of questions are they going to ask me? But we always find that by the end of journey, they're in the audit. We typically go on site for a week, actually. We've become fast friends. And, you know, we really have that intimate knowledge and inside knowledge of the credit union by the time we leave and we've made everyone feel comfortable because of the way that we approach it and the workshops that we hold while we're on site. So it kind of sounds similar.

Mark: Yes, it does. Yeah. And it's, it's kind of a good feeling, I think, to get to know a team and really feel like you understand them and there's kind of this two-way dialogue.

Host: Oh, I love it. It's my favorite to go onsite and spend a week with a client. Especially after the pandemic, we've done two so far and it's just like, it's so great to be back in the field and just helping people. You know what I mean? Like here's the challenge. We'll find a solution for you. So once we leave, they're like, ugh, thank goodness we have them because they're going to give us a bunch of different options and areas that we can improve ourselves. So on that same vein and talking, getting back to Momentum, you're working with a new client, a clients, and they need new space. They need new retail space, help us navigate that process and how Momentum handles that.

Mark: Well I think first we want to know what is the purpose of this space? So are you trying to grow your market? Is this a new location in a new market or an infill location or is this location replacement from it for an existing branch? Right. So a little bit of analytics where hopefully, either we're doing location analytics with the client, with our partner or they have some analytics, they've done themselves. Right? So, often, you know, an existing branch, for example, has an existing clientele, existing book of business. And the business drivers are decisions that are different right, than from a new location.

They're, they're often thinking of maybe a different delivery model, right? They want to staff the branch differently, or maybe they want to think about the amount of space they're using. They don't need as much space. They might be shrinking their footprint, but in the same location or often, I mean, especially, you know, with financial institutions, it's a matter of kind of bringing the environments on brand. Right? Frankly, every five, seven years. Right. You really need that refresh. And so.

Host: Absolutely. Just like every five or seven, you need to refresh your website and your logo. That makes sense. Okay.

Mark: Yeah. Right. Because it's a challenge is to make sure that your financial institution is visually appealing, right. That your customer consumer connects to you, your organization, your brand on kind of a deeper, authentic level. Right? And that kind of identity level, even a branch from 2000, right. Someone today in 2021, visually, is that going to be appealing? Is that going to be, something that I, as a consumer, I'm going to connect, connect to you? Probably not. Right. So that's usually the challenge for legacy branch. New branches, new markets, it's often much different. What we really see, usually is maybe a shift to a newer more contemporary delivery model. So a bigger mix of digital, self-service and then, of course advisory services, right. You know, your, high touch, high quality problem solving and advice, right from your employees in the branch. Usually the amount of transactions in a new branch are expected to be a lot lower because, again, you just don't have that book of business that's used to coming into the branch.

Right? And you're also trying to drive a different business objective. You're really using that branch almost like a billboard or a sign in the market. Right? You're trying to be, to visually, again, connect to the market and let people see you're there and you're available to bank with.

Host: Awareness. Yeah. absolutely. That makes a ton of sense.

Mark: What is ideal then often is again, you kind of go back to those exercises, the round tables, and really think about network-wide, organization-wide what do you need your branches to do for you? What objectives do you have for the business? Which way are you going? Are you going to more digital self-service? Are people thinking with you online through their own mobile devices? Are you trying to decrease staffing, staffing levels in the branch? Are you trying to add different levels of service? What's going on with your brand, right? And then we can create an ideal design for your branch, right?

We'll call that prototypical branch really think kind of free of constraints. What would the ideal branch look like? How would it function? How does it work for your staff? How does it make your, member or your customer feel? And then we would apply that prototypical design to these different models, to the legacy branch, to the new branch, new market branch, to a small, maybe storefront branch, a hub branch, et cetera, and it just makes the whole process easier.

Host: Okay. So that's like a huge process, but an undertaking that from what I'm hearing is kind of a necessity. And then out of that prototyping experience, what is the client? What is your client, the credit union or community bank left with?

Mark: What are they left with after the process, it's really a guide. It's like a handbook. I don't know if I would say it's a huge process, but it's that idea of going slow to go fast. So, it's a little bit of time and it's not that expensive and not a huge expense, but it's a time thing upfront to really methodically plan and think about what you have, create this document, this guide, and then it makes all decisions going forward so much easier and streamlined because you have taken the debate around the elements of the branch, you've created clarity amongst your team on why a branch is the way it is. Right? And then you're able to hand that over to an execution team, with a higher likelihood of success and speed of delivery, frankly, lower cost again. But yeah, it's a handbook.

Host: So it's just like anything in life, if you take the time, put in the time, put in the effort at the front end, load your, you know, front load with strategy, then the outcome is going to be quicker in terms of your builds, right? Like we have a client that, oh my gosh, they want to build a new branch or they want new retail space every six months. So I imagine the prototype process is, something that's really going to be advantageous for them.

Mark: Right because otherwise you're rehashing the decisions, with every new location. There's just not quite that standard to go back to. And what's cool, these days with technology is we even we'll put this branch model into a 3D image where people will even, we'll put on our virtual reality headset and people can even walk through the branch and really feel what it's like to be in this branch. Experience the environments. And it really helps I think teams understand and be comfortable with the changes perhaps that they're making.

Host: Yeah, that's really cool. Well, good stuff. So I'm just going to ask it because good old pandemic. What are you seeing with workspaces in terms of, since the shift of everybody basically working from home and a lot of backend office type can work from home probably forever. Right? So what are the challenges? What are you seeing?

Mark: Oh, gosh, that's the million dollar question. Frankly, I'm not seeing much change yet. I what I'm seeing is a lot of talk about, about cheese, but we're not really seeing the change yet.

Host: Makes sense.

Mark: I'll just jump to some advice. I think the best advice right now is to really keep things flexible in terms of, you know, what's going on in the workplace and the work with your workforce. I think that, credit unions, community banks, right now are really responding to the job market and really are doing what the employee asks for. It's really become, I think, weighted, the decisions around the workplace are really weighed in the save our employee right now in terms of if they want to work from home. Sure. You can work from home. From some of the experts I've talked to, we work with the researcher at the University of North Carolina, for example, they would say that there's a big question mark, around how well this degree of remote work will work in the longterm. So we think you've got to really consider what's going on with your employees, with your organization. Maybe not lock into the decisions yet, but I'll tell you, we are thinking around remote work and hybrid work with our clients. We've done, gosh, probably four corporate office workplace strategies, just in this last six months for partners who are trying to think about how is this going to impact us in the longterm?

Host: Cool. Well, that's great advice. Okay, so Mark, along the lines of advice, what have you, Jenny and Bob found yourself as of recently giving to your clients leadership at these different organizations?

Mark: In terms of the, the corporate office workplace, our advice has really been build your solution both from the bottom up and from the top down. What I mean by that is you definitely need to be asking your employees what they want, what they need in the workplace, right, to be successful? And that includes, you know, talking to them about their remote work or hybrid work, work from home and what they need and what they prefer. But what you have to be aware of when you do that is that the biases that will show up, the experiential bias, personal bias. So, it's well demonstrated if you ask a worker what they want, what they need in their work, it is very much focused on what they do as an individual, right? Their individual productivity and contribution their role, as it should be. But it's human nature to really only focus on yourself in the way you work and maybe not think enough the team and how you work with others or what kind of other responsibilities you have.

So for example, you have your, your work as an individual contributor, but part of being a part of an organization is helping your teammates, right? Helping them feel connected to the business, helping answer questions, mentor them up and even help with recruiting, et cetera.

And, and, and it's hard for those things to happen when you're, when you're fully remote. We want to think about what we're seeing from the team members, that's kind of building the solution from the bottom up. Like, listen, listen carefully, make sure you're addressing concerns that you are creating optimized workplaces that support employee wellbeing, but also from the top down, the management team has a responsibility to be thinking about the way people work, the way people work together. And how that impacts the business going forward.

What kind of business objectives do you have? Are you trying to foster innovation, foster growth, recruit, retain team members? Are you trying to mentor younger team members, right? So, the leadership needs to think about what they're trying to achieve and how the work environment is a piece of that. So that there is a balance between the two, because they're, there's certainly not dead aligns. If you asked, if you did employee surveys and did exactly what the average employee asked you to do for the workplace, it would not be directly aligned with what leadership really thinks they need in order to be a viable business right?

Host: My gosh, I have, I have to believe that in some cases it might be just way off base. So that's good though. It's good advice and it's, it's not corny, but you know, our whole vertical really is about the movement is about people helping people. So, let's talk about technology. How, walk me through integration where technology is concerned.

Mark: Sure. I think what we want to do is just understand your technology ecosystem. Right? And how, different technologies work together, but also how they work, I think probably more importantly with your customer service, your member service strategy. Right? So how do you want to interact with your customer base in the branch? I think a pretty common mistake that I've seen is folks will select the technology that they want in the branch. Say we need to have one of these without really understanding how they're going to use it or how it's going to connect to kind of the bigger, more sophisticated kind of choreographed experience in the branch. Right? Because it never works when that's the strategy is the piece of technology itself becomes the strategy. It really needs to be frankly, in the background, right. Supporting kind of a, a better experience. Quite frankly, when people come to a branch to talk to a person, right, they're coming for advice, problem solving.

So we want to make sure we understand, what you want to do in the branch, how you want to help your customer and then, okay, how can technology make that things easier and better? And so, I think what's typical then, we'll see technology used, to help with waiting or queuing. Right? Cause that makes the experience better.

It's, it's more understandable for your customer. We'll use it for marketing, for merchandising because it makes it brighter and more, you know, the movement right in the branch is more exciting and engaging and frankly it's less expensive to be changing out your messaging with digital rather than with that fixed merchandising.

Then we're thinking about your employees. How mobile do you want your employees in the branch? Do they need to be moving around? Typically, yes. Right. We want the employees to be able to meet the member at the setting that's most comfortable for them, the member or the customer. You can't be dragging a fixed computer terminal around, right.

So what kind of technologies can the employee have that helps them be more mobile. Right? So we really want to think about that tech ecosystem. How do you tap into the core? How do you deliver cash? How do you deliver messaging, marketing, all those things and how can they work together. Again, I think carefully balanced between being at the forefront and in the background. Right? To a degree you do want it to be visible because I think that lends to the brand image of being forward thinking and modern and tech savvy, which I'm sure people that's something they identify with, but then you don't want them to be overwhelmed with the technology, confused by it.

Host: Right. You don't need it. You don't need to walk into a branch and be like you're in the George Jetson's living room. Totally get it.

Mark: No, exactly. And I think one other thing is we just try not to be dogmatic about what tech somebody uses. Right? There's so many different options and partners out there in the tech world. So what we try to do as project managers and experts in the branch, so we try to understand what are the different options out there so that we can help one of our partners select kind of the best tech partner to bring that technology in.

Host: Oh, that's great. So you help through that process too.

Mark: Oh, exactly. Yeah.

Host: Fantastic. So I assume that after tucking, speaking of ecosystems, your ecosystem of processes at Momentum, I have to imagine that you all do a ton of research. So let's talk about that.

Mark: It's something that I lead in the business and something that I really enjoy and so we're always thinking about the built environment and how we can make it better. Right? And we always want to have data, real research behind the decisions we make or the design strategies that we propose right, to our partners.

And so right now, because we have a few things going on, we did a pretty extensive research project working with the partner out of the UK called Leesman. And they're the world's largest workplace data provider. Right? They conduct workplace experience surveys, for over a million people around the world.

And one thing we found working with them and some of our clients, right, this is some proprietary findings that we found is that there is a really high correlation in the workplace between creating more choice in your setting. Right? So letting your employees move around more and work in various settings, right? So maybe not just fixed at a cubicle or a desk but around more lounge space for working, private rooms, project rooms, lounge furniture, right? Letting people move around and select their work environment actually is correlated with a greater sense of engagement to the organization. And a greater sense of community on a team. And both of those things are correlated to improved retention, for team members. Right? So I think it's something about both, just your ability to change your setting I think improves the quality and experience for an employee, right? It's change of settings, change of scenery, but then also the tools are more appropriate.

And then there's a sense that I think of empowerment for your employee. If they get to choose where they work in the building and I think that's ultimately one of the biggest goals of the workplace is to keep people engaged and on the team. So you have lower turnover.

Host: Yeah. Oh my gosh. That's great. So turnover, teams, let's talk about team Momentum. So what's your team mosaic look like?

Mark: At our core, we are collaborators, project managers. So, and of course designers, so we have a project delivery team and they all do have backgrounds in construction management, but a lot of expertise in project management as well, so they're really driving collaboration, bringing in different partners, subcontractors, vendors, tech brands, other consultants to help work on a project with one of our partners. Right. And of course the team members on our partners team. And then our designers, frankly, arekind of the same thing. They, they're also really project managers and integrators, but we do then internally, the strategy working with them. Jenny and I, especially again, the strategy, the why behind the design, and then getting that onto paper and, and managing that process with our partners.

Host: Well, that's fantastic. It's an experience.

Mark: Oh, absolutely. I would be remiss to forget my field staff because they are fantastic. So we also, of course, when we build a project, we have construction managers, superintendents on the site and they're, they're really responsible for the safety on a project. The quality control, the scheduling, the sequencing, right?

Host: That's a big job.

Mark: Oh, it's a huge job.

Host: Well, it sounds like, yeah. I mean, it's a big responsibility, but it sounds like you at Momentum, your team and the team mosaic, you've got every base covered. So, if our audience, our listeners want to get in touch with, or have a new project, or they just say, I don't even know if this makes sense. How do they get in touch with Momentum. Is it just through your website or talk to us about that? How do most people reach out?

Mark: Definitely through our website, momentumbuilds.com. We have a pretty extensive insights section as well that a lot of the research we've done, we've put together and put out there for people to look at. And really just kind of, you can thumb through the examples of the work we've done, and we present lots of case studies again, to kind of share the why behind the design and the buildings we build. So that's the definitely the best way. And of course you can me, as well, on my email, mark@momentumbuilds.com.

Host: Easy enough, easy peasy, lemon squeezy. Well, Mark, thank you so much for joining us on this Friday and I hope you have an amazing weekend on Whidbey Island.

Mark: Thank you. You too, Kelly. It was a great chat with you.

Host: Okay. Thank you.

Bill Klaproth (Announcer): And thank you for joining us. And to connect with Hillary or Kelly to simplify your credit union marketing needs with EmpowerFi's full service marketing and design support, please visit empowerfi.org. You can also email us at info@empowerfi.org for more information. And if you found this podcast helpful, please share it on your social channels and check out the full podcast library for topics of interest to you.

This is the Speakeasy Financial Marketing podcast. Thanks for listening.