Small business customers are among the most coveted assets of community banks. But increasingly, larger institutions are wooing these customers.  Community banks can continue to prosper in this profitable market by building on their strengths, especially their ability to provide personal, hands-on service, while adopting some of the tools that give larger banks a competitive edge. Community banks buy the logic of that advice, but they balk, understandably, at the prospect of making major infrastructure investments without any certainty that the ROI will be justified.

There are no guarantees in any business line, but one area where the payback potential for community banks is clear is in products and services for small businesses. Many community banks pursue small businesses primarily through officer call programs. The logic is sound. These bank officers understand the bank's products and services and know how to match the bank's offerings with the needs of small business customers. The problem is capacity. Bank officers have to kiss a lot of frogs in order to find that small business prince; they spend a lot more time calling than closing. This is neither the highest and best use of their talents nor the most effective way to produce business for a community bank.

Community banks can cut through the weeds, identify solid small business leads more quickly, and allocate the time of their officers more productively by outsourcing a portion of the customer call function to a call center. Although many banks recognize the potential advantages, they fear that the use of call centers will result in a loss of the personal hands-on touch that is the community banker's greatest strength. They also worry that call centers may repeat the worst practices of consumer telemarketing operations - calling customers at inopportune times; repeated (annoying) calls, etc. Finally, they have real concerns about the safety and integrity of their data - both from a competitive point of view, and from a customer privacy and regulatory perspective.

Richard Trachtenberg, President of E Communication Advantage (ECA), an Austin, Texas based company providing a broad range of call center services, understands these concerns, but says they don't apply to an effective call center. For one thing, he points out, a call program aimed at small business executives has little in common with a traditional consumer telemarketing initiative.

 "A completely different set of rules apply to b-to-b marketing," he explains. "When you're in business, you expect vendors to be calling you," and thus are much less likely than consumers to find those calls intrusive.  In fact, Trachtenberg says, many small business owners wonder why their community bank has not been soliciting their business.

An effective call center knows how to make these calls professionally and productively. They don't adopt a "one-size-fits-all" approach. They analyze the bank's small business market, identify likely prospects and help banks identify the strategies they need to advance the products and services they are offering. "The ultimate sellers are the bankers," Trachtenberg emphasizes. "They're the ones who close the deals. Call centers focus on the front end of the funnel."

There may be 10,000 small businesses in a market, but only 500 of them may have a profile that fits the product or service the bank is offering.  "We're good at finding those 500 prospects." he explains. Call centers find likely companies, identify the decision makers in those companies, and make the initial calls to introduce the bank, putting the bank and its services on the decision-maker's radar screen. Then the centers should provide the fast and coherent feedback to the bank about the prospect's interest level, and about the particular products and services to which the executives are most likely to respond. "The call center should operate on two equally important parallel tracks," Trachtenberg notes, "conveying information about the bank to prospects and delivering information about prospects to the bank."

But do call centers make economic sense for community bankers?  Trachtenberg says few executives are better than bankers at calculating their return on investments; it is simply a matter of running the numbers. "We can calculate how many leads the call center is likely to generate. Banks just need to determine how valuable each potential lead is to the institution."

According to industry estimates, a call center, utilizing a well-trained staff and the latest technology, can make 12 to 15 calls per hour to the appropriate executive - usually the CFO or CEO in a small business.  Depending on the product line, the lead conversion rate will range from 6 percent to 8 percent at the low end, to as high as 10 percent to 15 percent.  But all call centers are not the same. How can a community bank select the "right" call center for that institution? Essentially the same way they go about selecting any third party vendor - by doing a lot of research and asking a lot of questions.

Experience. Does the call center have experience in dealing with b-to-b marketing and in reaching the decision makers? Insist on detailed information about the strategies and systems the call centers intend to use.  Also ask call centers you are considering to document their track record.

Reporting. Ask specifically about the reporting systems. You want to make sure that yesterday's marketing efforts are reported by the next day - e.g. "We made 1000 calls and identified 25 hot prospects the bank should call back immediately; 50 are warm but need additional information; and another 100 don't need immediate calls but should receive specified collateral and other follow-up."

Security. Bankers should be particularly concerned about security from a competitive and from a regulatory standpoint. It is important to make sure that the call center does not just consider this a computer issue. While protection from hackers is important, there is a lot more to maintaining a secure environment for your data. And it is not just the data that goes from the bank to the call center that must be secured; you want some assurances about the security of the data the call center obtains. But even the most secure computer system cannot protect your data unless the vendor realizes that security is a human resource as well as a technology issue. Ask about the systems for protecting the confidentiality of the data, and ask specifically about the background checks the center performs on its employees.

Technology. The call center should have technology in place to permit you to monitor calls on a real-time basis or should digitally record calls so you can listen to them later - so you can evaluate effectiveness and adjust the script as necessary. Integration of the telephone system with the web can also be valuable, so any information a prospect requests can flow immediately from the call center via HTML files or rich email. In addition, you should assess the quality of their employees in the technology context.  You want a call center with both the people and systems necessary to manage the data base effectively, so you obtain real time information about the calls and the information the calls produce.

Costs. Make sure you understand what is included in an hourly rate quote. Do the costs include everything, or are their additional costs for programming, customized reporting, set-up charges, etc.

Expandability. Can the call center take care of all your needs? Does it have the capability to provide inbound customer service, and effective customer support?

Partner. Finally, you should look for a call center that will do business the way you want it done. In essence, you are looking for the call center equivalent of a community banker -who understands the value of customized service and is eager to conform to your needs rather than having you conform to their capabilities. You don't want a vendor, you want a partner who understands your business, your goals, and your customers, and has the tools, experience, technological capability, management, staff, and flexibility to advance your business your way.

Jerry Groskind is President of eContentplus, Inc. eContentplus provides customized editorial content and communications services for financial institutions.