3 Reasons Why Your Financial Institution Needs a Consultant
By Jenn Addabbo
Chief Executive Officer and Co-founder
At first glance, many might ask, why not solve your problems internally, whether it be a cost reduction effort, a strategic move to enter a new market, or an upgraded digital/fintech project? Sometimes the reason can be simple. An external perspective is needed for guidance and protection.
The pressures that banks and credit unions face daily can be extreme. Many employees find themselves playing various roles within the financial institution. With so many hats to wear, you can quickly run out of capacity and resources and have no time to “do it all.”
There are many benefits to working with an experienced consultant, but three stand out.
Expertise and Visibility
Consultants offer an unbiased perspective based on what they’ve seen work (or not) before. The best consultants are vendor agnostic. They truly feel there isn’t a “one size fits all” for vendor selection.
A consultant’s primary value is their knowledge, expert skills, and influence. At Engage fi, we work daily with a number of vendors that support banks as well as credit unions. As a result, we are continuously broadening and deepening our knowledge of banking trends, industry challenges, and new technologies and processes so we can better assist and inform financial institution employees who already have too many hats to wear. In addition, we know which vendors are performing well and which ones aren’t. It can be easy to believe what a vendor salesperson is telling you as fact, but unless you have a perspective of the market conditions and visibility into other deployments and service levels, you can’t be certain.
Additionally, some risks are inherent with certain vendors, especially with the fintech explosion. Everyone is excited about newer technologies, but it can be distracting. A consultant can conduct the necessary due diligence and ensure the risk is suitable for your financial institution’s long-term goals – they get to know and understand your requirements. If your financial institution is on the cutting-edge, then that will be a completely different type of vendor set than a financial institution who doesn’t have the resources or is a little more risk averse.
Vendors are becoming more proactive and approaching financial institutions well ahead of contract ending dates, and they are enticing or incenting to renew. It’s nearly impossible to manage these complex vendor incentives that are constantly changing. A financial institution may choose to take whatever incentive is offered and extend its contract, but that might not be the best path forward based on the financial modeling and competitive market. This happens frequently because the financial institution doesn’t plan on changing vendors, have the time or expertise to analyze the offer, or have visibility into what options are possible.
At Engage fi, we want to reinforce the idea that you don’t necessarily have to change vendors, but you need to know the right questions to ask to ensure you are getting the most out of your contracts and vendor relationships. For example, an experienced consultant can help you negotiate better terms that will have a more significant impact long term than any incentive that was initially offered. Maybe it’s in your best interest to wait until closer to the contract term and renegotiate. A knowledgeable consultant can help you use negotiation levers that you might not be aware exist.
The Right People
We’ve all heard it before: the right people on your team can truly make a difference. Unfortunately, financial institutions may think they will receive a better opportunity by leaving a vendor, and that is not always the case. Sometimes you just need to push the reset button on your existing vendor-partner relationship.
A consultant can help you identify which processes are effective and which ones aren’t. Additionally, a consultant can work with your vendor to reestablish guidelines and service-level agreements. At Engage fi, our consultants get to the crux of challenges with the vendor relationship so you can focus on other priorities. Many times, you are already working with the right people who know your financial institution’s goals, and only small adjustments need to be made. The answer isn’t always to leave.
The expertise and objective viewpoint of an experienced consultant are invaluable in guiding your financial institution to a healthier, more profitable outcome. Engage fi can help you create the necessary checks and balances to ensure you stay on top of your financial institution’s strategic goals while protecting your greatest asset – your team and your customers and members.
Jennifer Addabbo is Co-founder and CEO at Engage fi and has worked in financial services for over 20 years. Prior to founding Engage fi she worked for large financial services technology providers in digital banking and payments.
Engage fi has 47 employees with extensive industry background and has saved its clients over $2.5 billion in savings and incentives. To learn more about how Engage fi can help your financial institution, visit www.engagefi.com