Reconsidering the Branch: Retail Branch

Another type of branch that is being built by banks and credit unions around the country is the “retail” branch.  These are akin to open retail stores, in that a person can walk around and interact with tellers in a more personal, open manner. The concept is that the customer or member enters into an atmosphere that does not have a barrier between them and the teller helping them.  This is usually achieved with teller “pods” instead of a teller line.  Members and tellers can then carry on transactions in a more friendly and conversational way. Why do this?  Banks and credit unions are finding that it is easier to work “with” someone without a physical barrier and it allows for greater cross-selling of products and opens communication to solve problems the customer may be having. Teller pods commonly hold cash recyclers that make teller transactions faster and more accurate.  This equipment also provides a level of built-in security that is recommended for this more “open” branch model.  Retail branch models tend to also have large glass frontages which deter robberies.  The security is inherent in the openness of the branch model. Branding is also highly prevalent in this type of branch, where everything from marketing collateral, signage, artwork, finishes and even furniture are used to enforce and strength the institution’s color palette.  It results in a cohesive space that will always “feel” like that credit union or bank, no matter where the location is.  Branding is incredibly important to the new branch, because if your customers feel that they could be anywhere, there is no reason to be with you. This type of branch can lower staffing needs in each branch by allowing MSR’s to rotate between retail stations (office and pods) depending upon need on a per customer basis. If you would like to discuss renovating a retail type branch, contact Phillip Kern at Labarre Associates for more information about what we can offer you.
Next in This Series: Case Study of a Retail Branch

Previously: Reconsidering the Branch: Tellerless Branch and the Tellerless Branch Case Study

Reconsidering the Branch: Tellerless Branch Case Study: Campus Federal Credit Union – Our Lady of the Lake Branch

Location: Baton Rouge, LA
Type: Tellerless Branch / Interactive Teller Machine
Owner: Campus Federal Credit Union
Architect: Labarre Architects, APAC
Contractor: Milton J. Womack, Inc.
Completion Date: 2014

Campus Federal Credit Union has been one company to fully invest in the tellerless / interactive teller machine system.  In 2014, they opened two branches with interactive teller machines, started construction on a third branch with the technology inside their lobby and within a drive through, and created a remote call center at their headquarters building.

Challenge: The previous branch in Our Lady of the Lake hospital was small and tucked away inside of the main hospital building.  Traffic was not natural and it was easy to miss the credit union’s location.

Solutions: In response to these problems, Campus Federal acquired a lease for a larger space (approximately 1,100 square feet) to open a couple offices, small conference area, and break room for their employees.  The lobby holds two interactive teller machines and is completely open to the atrium of the Medical Plaza Tower.  The seamless transition from hospital corridor to the lobby is inviting and intends to pull people in.

The interactive teller machines are able to do something that traditional teller lines cannot do, which is allow the lobby to be completely open 24 hours a day, and move the secure walls inward toward the office and break room areas.  While not currently implemented, the interactive teller machines will eventually have the ability to have access to a teller all day, every day, instead of members only having access to an ATM for withdrawals and deposits.  The machines do have the ability to be a remotely controlled piece of equipment by the tellers in the call center, which allows the credit union to open up different types of transactions and interactions that would not be available to an average ATM without tubes.  Transactions can also be monitored by bank employees.  This technology also opens up options for smaller micro-branches and stand alone interactive teller machine drive throughs without a branch because no tubes are needed.

The branch initially received attention for its unique openness and the thrill of new technology.  Members coming in to check out the new technology, and returning to show other people, was a unique opportunity to sell other products, catch up with members and get to know their needs as customers, and opened up potential for new members who were interested in being a part of this convenient branch that would be open to them on their schedule.

The call center had very specific requirements for this type of interaction as well.  Lighting, acoustics, backdrops, cameras, and cubicles which are taller than standard cubes are necessary for the member to see and hear the teller clearly.  Training for the teller to look directly into the camera is paramount to giving a member the one-on-one feel across technology and typically takes 1 to 3 weeks.  Additionally, it is recommended that when hiring staff, that an interview be done over Skype or some other similar web-based program to judge their natural ability to present themselves on camera.

The upfront cost for specialized bank equipment, call center set up, training, and renovation of branches is in some cases prohibitively expensive, but the pay back period for implementing several branches at the same time is a relatively short period of time through savings in staffing costs.  This method of pay back considerations doesn’t take into account the potential in higher sales that may occur when a concierge and MSRs are free to chat and talk to members about added needs, or the added clientel for members who need a branch that responses to schedules that do not normally fit into bank hours.

Next in this series: Reconsidering the Branch: Retail Branch


Previously: Reconsidering the Branch: Tellerless Branch

Additional Link:

https://www.campusfederal.org/

http://www.mjwomack.com/

Reconsidering the Branch: Tellerless Branch

One type of branch that is currently being put into operation by banks and credit unions around the country is the “tellerless” branch.  These are akin to the self-check-out stations in supermarkets, in that a person can interact with the machine by themselves if they choose, or interact with a person if the need arises.

Interactive Teller Machine at Campus Federal Credit Union’s OLOL Branch in Baton Rouge, LA

There are several ways in which this new model is being implemented.  These tellerless branches tend to have one employee, or “concierge”, that greets customers and members at a desk near the entry and directs them to either a “smart ATM” or a member services area.  The “smart ATM” allows members to make deposits, withdrawals, or transfers like an average ATM, but also allows for the member to talk to a teller in a remote location.  The customer will be able to see the teller on screen and talk to them over a handset for privacy.

The remote tellers are either in a centralized location in another building (sometimes a great distance away) or in another room in the branch.  The benefit of having the tellers in another building is that one call center can service many, or all, of the branches under one company.  This allows for branches to have a full “virtual” staff during slow and busy periods, spreading resources where they are needed instead of having tellers waiting for customers to come in.  For instance, if you have 3 traditional branches with 3 tellers each (9 tellers total), it may be possible to have 3 tellerless branches with 4 or 5 remote tellers (of course, your actual numbers would have to be determined by analyzing the usage in your branches!).

Unfortunately the start-up cost of setting up a remote call center and adding in the smart ATMs can be quite high, although it is believed at this time that the initial costs will be recovered through potentially lower operational costs (less payroll the more branches implement the system), through flexibility in site arrangements (potentially opens up opportunity for smaller branches, drive through only branches, and kiosks), and through freeing up branch staff to concentrate on increasing sales.  It is still recommended that someone be on-site because the machines cannot currently deal with crumpled bills, issue debit cards, take coinage, or print checks or money orders.

It can also allow certain branches to have lobbies open 24 hours with (relatively) minimal security risk.  Portions of the branch can be secured after hours, but still allow access to the machines with a 24 hour call center, or some machines can change to a “normal” ATM after hours.  This added convenience can add to a customer base as more people need a bank or credit union that works on their hours, instead of having to take time during their own work days to complete transactions.

Tellerless branches also remove the need for a drive through window or deal drawer, and can be used for drive-throughs to eliminate the need for long pneumatic tubes for sites that cannot have the canopy close to the branch.

If you would like to discuss options for a new tellerless branch or renovating to a tellerless branch, contact Phillip Kern at Labarre Associates for more information about what we can offer you.

Next Week: Case Study of a Tellerless Branch

Resources:

http://thefinancialbrand.com/43078/future-branch-network-redesign-strategies/

Green Roof 101: Components

Green Roof systems appear complicated due to the number of roofing components used in the roof.  However, the roof is really divided into two parts: a protected membrane type roof and the “vegetative” portion above it.

Protected membrane roof components:

• First there is a deck; if it’s a concrete deck, a primer will have to be applied for the membrane to stick.
• Generally there is a membrane fluid applied to the deck. Many manufacturers recommend fluid applied hot rubberized asphalt, but that isn’t the only option.
• After one layer of fluid applied is adhered, a reinforcing fabric is put down and a second layer of fluid applied is put on top. This second layer in a hot applied system will melt part of the first layer and laminate the reinforcement in the system.  Some manufacturers say this reinforcement is optional, but it is highly recommended to protect against failure.
• After the membrane is dry, a water resistant insulation board is put on top of the membrane. If the project calls for a protected membrane roof, this insulation board would have to be ballasted (have weight on top of it) to prevent blow off.
  • In the green roof example, the vegetative portion of the roof is a large portion of the ballast.
  • Also, for a green roof, a root blocking fabric is put on top of the membrane before the insulation is placed down. This is to stop any roots that manage to get through all of the other components of the vegetative system from boring into the membrane.

Vegetative roof components:

• Ballast: There are two types of ballast that make up the walkways and perimeters of the vegetative roof. Ballast is needed at the perimeters primarily because wind conditions are more intense at the edges of a roof and plants will not be able to grow there.  Ballast can be either pavers or gravel; however, in areas prone to high winds, gravel is not recommended, as it has the potential to create several small projectiles in a storm event.
• Edging: Regardless of type of ballast, a metal edge is put down at the transition from ballast to growing areas.
• Drainage Panels: these panels kind of look like egg cartons. They have a few purposes.  They can be filled with lightweight aggregate to add more ballast to the roof, they hold excess water that the plants don’t use right away but could use in the drier times between rain events, and they allow excess water that cannot be held in the cups to drain away in large rain events.
• Filter fabric: this fabric filters the water coming out from above to prevent dirt from being washed away in large rain events.
• Growth media: this is the “dirt”. It’s really not dirt, but a mix of different material that has been tested to support this type of installation.  The thickness of growth media is dependent on region and plant type.  An “extensive” roof has between 4-6” thick growth media and can hold small plants that will probably not grow more than 8” tall.  An “intensive” roof has much thicker media and can hold larger plants.
• Plants: manufacturers have pre-prepared lists of available plants per city and/or region. While it is possible to go outside of these prepared lists, it is not recommended because the lists are full of plants that are able to withstand the abuse that a roof garden is subjected to in that region and are more or less proven to thrive and expand to cover the roof within a couple of years.  Most plants are in the sedum and succulent categories.
  • There are several ways that these plants can be provided: mats, plugs, and cuttings. In high wind regions, plugs are highly recommended.  The mats currently on the market are not developed for the particular issues that we face in the South (tropical winds, higher temperatures, etc.), and cuttings are not recommended for high wind.  This means that at installation the roof will probably look quite bare, and it is important to include a “coverage and thrive warranty” with the other warranties in the roof system.

Green roofs do not need to be confusing, even though there are a lot of individual components.  At its most basic, it is a protected membrane roof with walkways and planting over top of it.

For Part 1 of this green roof series, “Green Roof: Pros and Cons”, click here.

Resources

http://www.greenroofs.org/index.php/about/aboutgreenroofs

Green Roof 101: Pros and Cons

This article has been updated on our new blog hosted on our website, please follow this link to see the updated article.

Sedums and succulents for an extensive green roof

Green Roof systems are increasing in prevalence in the South.  The pros and cons of the roofs are many.  So how can you decide if a green roof is right for you?  Why would you want one?  What trade-off is necessary to keep one versus having a more conventional roof?

Green Roof Pros:

• The plants on a green roof capture the heat and sunlight which cools the roof significantly. A green roof can be cooler than surrounding air temperatures in the summer, whereas a conventional roof is generally hotter.  When a roof doesn’t radiate heat in the air, rooftop HVAC units pull in cooler air (closer to the air temperature around the building) and less energy is needed to cool it.  There are also savings due to added insulation value for the interior (less cool air is escaping from inside).  How much it will save in energy cost is highly dependent on square footage.
• The waterproofing membrane is protected from UV rays by several layers of material, which may result in a longer life for the roof membrane
• Storm water runoff is more limited (60% run off is “captured”, used by the plants, or has delayed drainage as it filters through the growth media), which means potentially less flooding around your building and parking lot and lower sewer impact fees
• The extra thickness of the growth media and plants also acts as a sound barrier in urban environments
• If open to the public, it creates a unique feature which may draw more people to your building
• The national average payback period for a green roof is only 6.4 years through storm water retention, energy savings, etc. This becomes more advantageous as more regulatory bodies add fees to storm water runoff.
• A green roof usually has a longer warranty period (20-30 years depending on manufacturer for a green roof vs 10 years SBS)

Green Roof Cons:

• Usually outside of the scope for renovations – structural capabilities to hold the added material on the roof would have to already be in place
• The initial cost is more than a traditional roof – about $13.40/sf more on average nationally in 2014 for extensive (which is a thinner roof with smaller plants like sedums and succulents – see photo) and $19.70 over the cost of a traditional roof for intensive (which is a thicker roof that can support larger plants like shrubs). However, installation costs per square foot decrease as the roof size increases.
• Ongoing maintenance of plants is needed, though low maintenance plants are used (typically $0.75-$1.50/sf per year). Much of the maintenance is in the first few years as the plants establish themselves and create a ground cover on the growth media.
• A large amount of the roof has to be ballasted (with pavers or gravel around the perimeter) in wind prone areas, which means a small roof cannot house a large planting area

For Part 2 of the Green Roof series, Green Roof 101: Components, click here.

Update (06/01/16): If you want to see some photo examples of a green roof project we’ve completed, click here for our update page.

Resources

http://www.epa.gov/heatisland/mitigation/greenroofs.htm

http://www.gsa.gov/portal/mediaId/167839/fileName/Cost_Benefit_Analysis.action

http://www.house-energy.com/Roof/Roof-green-costs.htm

http://www.deeproot.com/blog/blog-entries/the-costs-and-benefits-of-green-roofs

http://www.redbeacon.com/hg/ins-and-outs-roof-garden/

http://www.igra-world.com/benefits/private_benefits.php

Energy Saving Techniques: Part 2 – “Medium-hanging fruit”

You’ve done the “low-hanging fruit” energy saving items for your building, but want to do more.  What comes next?  See below for some more ideas on how to save on your energy bills.

Interior Lighting:

• Install daylight sensors in rooms that have a lot of windows and program lights to dim when daylight will suffice.
• Investigate redesigning your ceiling layouts to take advantage of new lighting technologies. Optimize new fixture layout for actual lighting needs on work surfaces.
• Replace high-pressure sodium lights to metal halide, or better yet, LED fixtures.

HVAC & Temperature Controls:

• Replace HVAC equipment with new, energy efficient equipment. Take a look at actual heating loads for the building’s operation and investigate if a reduction in size of units is justified for further savings.
• Invent in VRF equipment, where each zone has its own thermostat for individual control and thermal comfort.

Water Saving (hot water = energy costs):

• Consider switching to tank-less water heaters, or switch to a more energy efficient water heater.

Miscellaneous Energy Savers:

• Install spray foam insulation in your attic. This can act as a better barrier than regular batt insulation because it expands to fill in gaps in construction and has no joints.
• Replace glazing in windows with Low-E, insulated glass. Get argon gas filled glazing for best results.
• Shade your windows from the outside. Consider things such as shade trees to shade your building or canopies and awnings to shade your windows from the outside – before the heat can infiltrate your building.
• Invest in a “cool roof”.
• Develop an Operations and Maintenance Plan to get the most use out of any energy saving items you’ve completed and continue on with better operations practices. Otherwise those initial savings can slowly creep back on you.

If you would like an individualized plan for more in-depth energy saving techniques for you building, including an “energy audit” or “cost/benefit analysis,” contact Labarre Associates for more information about what services we offer.

For Part 1 of the Energy Savings Techniques series, “Low-hanging Fruit”, click here.

Energy Saving Techniques: Part 1 – “Low-hanging fruit”

So you want to save money on operational costs of your building – who doesn’t?  We’re here to help.  See below for some ideas on how to save on your energy bills (in no particular order).

Interior Lighting:

• Replace incandescent bulbs with Energy-star labelled compact fluorescent or LED lamps.
• Replace overhead fixtures with T-8s (or T-5s).
• Replace exit signs with LED exit signs.
• Install occupancy sensors in rooms that don’t get much use, such as break rooms or restrooms.
• De-lamp over-lit areas.
• Replace building mounted and signage lighting with LED bulbs.

HVAC & Temperature Controls:

• Install a programmable thermostat. Reduce heating and cooling at night when no one is in the building, and set to turn back to normal operating temperature at least 1 hour before the first person walks in the door.
• Adjust the thermostat for the seasons.
• Change the filters for the air intake.
• Have evaporator and condenser coils cleaned. This will increase efficiency.
• Get under an annual HVAC maintenance contract.
• Have your HVAC system re-balanced.

Water Saving (hot water = energy costs)

• Repair leaky faucets, replace with water saving faucets or install automatic shut off faucets.
• Insulate the first 3 feet of hot water piping coming out of the hot water heater. If it is 7 or more years old, insulate the water heater tank too.
• Turn down the temperature on the hot water heater to 110-120F.

Miscellaneous Power Savers:

• Put computers to sleep overnight, and put monitors to sleep after 30 minutes of idle use.
• Allow office equipment (copiers, printers, fax machines) to be put into sleep mode, or turn off, after a set period of time. Turn off completely at night.
• Replace office equipment with Energy-star rated equipment.
• Check your break room refrigerator for potential door gasket replacement. Close the door on a dollar bill and if you can pull it out easily, you’re losing cooling – replace the gasket.
• Clean the refrigerator coils for better efficiency.
• Replace old break room appliances with Energy-star rated appliances.
• Re-caulk your windows.
• Replace weatherstripping on your exterior doors.
• Go into your building after-hours and see what’s on that shouldn’t be. Develop a plan to switch these things off when locking up the building or program them to turn off automatically.
• Complete janitorial activities during open hours to reduce the amount of time lighting is on.
• Inspect and repair any damaged insulation.

If you would like an individualized plan for more in-depth energy saving techniques for you building, including an “energy audit” or “cost/benefit analysis,” contact Labarre Associates for more information about what services we offer.

For Part 2 of the Energy Saving Techniques series, “Medium-hanging Fruit”, click here.

Resources:

Energy Star Tips: http://www.energystar.gov/buildings/facility-owners-and-managers/existing-buildings/save-energy

Strategic Planning In The New Normal

Want to know how facility managers supporting an organization with a low or no-growth profile can add value? By developing a long-term capital budget that identifies future capital expenditures and prevents “major surprise” expenditures, like roof replacements that can give rise to questions about the facility manager’s competency (i.e. “It’s a twenty-year roof that is more than twenty years old – shouldn’t you have budgeted for replacement?). Expanding your planning process from pure budgeting to a strategic process requires a holistic approach where you step back, do some research and ask four questions:

1. Where have we been? Identify facility performance versus benchmarks like cost per square foot or square feet per occupant. Gather past indicators of organizational success over a multi-year period and plot multiple key performance indicators on one chart.
2. Where are we headed?– Getting a handle on the impact of three overlooked drivers of capital spending can provide input for a long-term plan that minimizes surprise expenditures:How will we get there? Plans, budgets and schedules are important ingredients of all strategic facility planning exercise. Facility Managers should leverage the financial impact of their plans on both operating cost and capital expenditures to open the door to present their plan in the executive suite.
   1. Regulatory Issues – Some think the federal law banning the manufacture of certain types of lights has been repealed. It hasn’t. The manufacturing ban on incandescent bulbs has been pushed back past the election and the ban on manufacturing T-12 fluorescent bulbs goes into effect soon and will force facility mangers to choose between expensive replacement bulbs, ballast change-outs, or fixture replacements. Other issues such as rising prices for R-22 refrigerant could alter the value equation for repair versus replacement for outdated HVAC units and chillers. Talk to your vendors to get a complete picture of the regulatory impact on your span of control or visit the BOMA website at BOMA.ORG.
   2. Functional Obsolescence – Expenditures for renovating corporate or back-office space to meet the needs of new users are often not approved because there must be an offsetting cost, like lease savings, to justify the project. This is not the case for customer-interfacing space. Consider a family-run, fifty-year-old barber shop in Colorado that gave a complete overhaul to its retail space and saw sales almost double in six months. Retailers and financial institutions are finding that similar renovations are paying big dividends and they are proceeding with renovations despite the recession.
   3. Facility Renewal– Buildings wear out. The concept of depreciation was developed to allocate a portion of the building “that is used up” each year to operating expense. Public buildings are depreciated over a 50-year period so it can be assumed that approximately 2% of the building is “used up” each year (2-1/2% for 40 year commercial structures). An average of only 50% of the construction cost of a building requires renewal (foundations, earthwork, general conditions etc. do not require renewal) so in reality, about 1% of the building is “used up” each year. Facility Managers with a large number of facilities can use mathematical formula for each building to determine “order of magnitude” annual facility renewal1 needs:
      1% x current replacement value = annual renewal needs

      Some facility managers complete a survey of facilities then calculate renewal costs, which are then factored into a formula called the Facility Condition Index (FCI). This formula can be used to rank the relative needs of various facilities:

      FW=        Facility Renewal Cost
                  Facility Replacement Value

      Furniture lines are manufactured in a manner similar to automobiles. A particular line runs for a number of years, then parts are manufactured for a few more years. After that time, facility managers must go to the aftermarket – usually a guy with a barn in Tennessee. Be sure to work with your vendors to evaluate your furniture, because you may find that you will not be able to support a significant re-organization without considerable difficulty in getting the parts and pieces. As crazy as it sounds, many companies are searching for beneficial capital expenditures in today’s environment and the “deals” available from the various furniture manufacturers sometimes make sense when viewed from the lens of the chief financial officer.

   4. Growth – When queried, both executives and middle managers in tenant organizations will tell facility managers they have no plans for growth. However, the economy will recover (it always does2), and when it does, there will be the need for more more space regardless of what people tell you today. Rather than establishing elaborate scenarios that lay-out your future options for accommodating growth, try tracking both “vacancies” and “available capacity” (reconfigured space – the limit is usually your parking lot size).
3. How will we get there? Plans, budgets and schedules are important ingredients of all strategic facility planning exercise. Facility Managers should leverage the financial impact of their plans on both operating cost and capital expenditures to open the door to present their plan in the executive suite.
4. What must we do to build a consensus? One way to institutionalize your facility decision-making process is to develop a facilities “vision” and “guiding principles” to assist in making solid, fact-based facility decisions. Organizations with boards of directors find these tools invaluable in orienting new members to the organizational culture. Expanding your “vacancies” and “available capacity” report to include periodic or annual summaries of facility management activities is important in engaging executives in a continuous dialogue about facility issues.
5. Conclusion – Without immediate pressure for growth or re-organization, facility managers may feel that strategic thinking and strategic facility planning can be placed on the back-burner. The key word for today’s environment is “strategic alignment” where the principles of strategic facility planning are used to identify and plan for all types of capital expenditures, including regulatory, renewal, functional obsolescence and the eventuality of growth. There are plenty of opportunities: low lease rates, good lease locations and low construction cost per square foot. Seize this moment to improve the performance of your assets and improve operations!

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Celebrate World FM Day!
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Six Questions to Ask Potential Facility Management Service Providers

Before you consider outsourcing or switch providers, consider the following:

1. Does your Facility Management firm specialize in Financial Institutions?  There are special skill sets are are required for both professional staff and blue collar staff staff serving Financial Institutions.
2. Are the partners and staff seasoned specialists?  Will the staff that is assigned to your engagement be experienced in the industry?
3. Is the firm focused on providing value-added services?  Does the firm provide generic services developed on a template or do they listen and develop a scope of work that suits your needs?  Are they constantly striving to provide additional value added services to help you manage your facilities better?
4. Does the firm prioritize service over fees?  Are the current or prospective fees so “lean” that Facility Management firms  have to charge extra every time there is a slight deviation from the original scope of work?
5. Are services provided in a timely manner?  Are your Preventive Maintenance visits on schedule and delivered in a professional manner.  Are consulting engagements (strategic facilities planning, feasibility studies, assessments and so on) delivered with an appropriate level of pre-planning and completed in a timely manner?
6. Is your service provider a trusted advisor?   Can your service provider offer advice on a wide range of services like architecture, construction, real estate and strategic facilities planning?