Sue Woodard: Lenders need to assess both financial and non-financial aspects of technology success
January 30, 2023 – GREENWOOD VILLAGE, Colorado – Especially in today’s market environment, the ROI on mortgage technology investments is one of the most important metrics lenders can measure — but more than the financial returns need to be taken into account, according to STRATMOR Group. In the just-released January issue of STRATMOR Group’s Insights Report, Senior Advisor Sue Woodard analyzes how mortgage lenders can assess their technology ROI more accurately.
Woodard’s article, “Unlocking the ROI of Mortgage Technology,” compares the experiences lenders have with technology to how consumers use Peloton®’s popular line of interactive exercise equipment. In both cases, the best results are achieved when users commit to change and adoption.
“We buy the equipment with the image in our head of the outcomes — healthier heart, stronger muscles, weight loss, increased stamina — one or all those things are the ROI that we expect for investing in fitness technology,” Woodard writes. “But the only way we’ll see those meaningful changes is with a partnership between the technology and services being provided (in this case, by Peloton) and ourselves the riders, via changes in our own habits, routines and disciplines.”
This is exactly how mortgage lenders should be thinking about the returns they hope to gain from the technology they have recently invested in and new tools in the future, Woodward says.
According to her article, there are typically four categories of benefit that contribute to overall ROI: profitability, productivity, people and risk prevention. Lenders would like to see a return in all these areas, but when they don’t get it, they often blame their technology partners. “Here is an uncomfortable truth: the lender and the vendor both share responsibility for making technology deliver,” Woodard says.
However, measuring the financial and non-financial aspects of technology success can be a challenge. The process requires the lender to look beyond spreadsheets to the front lines and ask employees about the returns they are enjoying from technology investments. Adoption and change management are the keys to increased ROI, and while the vendor can certainly help here, this responsibility falls primarily to the lender. Woodard provides tactics lenders can use to improve ROI, but ultimately, lenders must commit to creating this change.
“Written another way,” says Woodard, “don’t just buy the Peloton. Be the kind of person who is committed to their health and fitness.”
Find the entire article in this month’s Insights Report.
A second Insights Report article by STRATMOR Customer Experience Director Mike Seminari, “How Can Lenders Thrive in a Post-Meltdown Mortgage World?” discusses how the year ahead may leave some lenders feeling like a character in the AMC series The Walking Dead.
After a year of mass layoffs and a 70% drop in loan volume, many in the mortgage industry are like the show’s survivors, just happy to be alive. But the close of 2022 was only the end of a season, not the end of the story, Seminari writes — and many in the industry are asking, what next?
Seminari offers suggestions for building a customer experience strategy that takes a page from the series’ script: find the damage, repair the issues and monitor progress toward a better future. He also provides three steps lenders can take today to thrive in 2023.
Click here for the January 2023 edition of STRATMOR’s Insights Report.
About STRATMOR Group
STRATMOR Group is a leading mortgage industry advisory firm that provides a range of programs and services designed to counsel lender CEOs and senior executives. STRATMOR serves more than 250 companies annually, providing strategies that increase growth and improve profitability in sales, marketing, technology, operations and mergers and acquisitions. The company leverages comprehensive, propriety data and key insights gained through extensive experience in the mortgage industry. STRATMOR is well known for its financial models and its collaboration with the Mortgage Bankers Association in the PGR: MBA and STRATMOR Peer Group Roundtables Program. Find out more about STRATMOR on its website at www.stratmorgroup.com.