Keys To Measuring ROI On Tech Spending

LENDERS NEED TO ASSESS FINANCIAL AND NON-FINANCIAL ASPECTS OF TECHNOLOGY SUCCESS

Especially in today’s market environment, the return on investment 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.”

AT FIRST SOME MIGHT THINK, ‘I’LL JUST TREAT MY CLIENTS AND COWORKERS LIKE THEY’RE WHITE PEOPLE,’ BUT THAT COULD BE A MISTAKE. IT’S NOT ABOUT TREATING ALL GROUPS THE SAME. IT’S ABOUT RECOGNIZING DIFFERENCES AND UNDERSTANDING PEOPLE’S CULTURES — THAT IS HOW TO HONE IN ON MARKETING TO EACH GROUP.

Studies show even small mortgage firms’ bottom lines benefit from D&I

By KATIE JENSEN, STAFF WRITER, MORTGAGE BANKER MAGAZINE

Let’s face it, not everyone cares about promoting diversity and inclusion.

D&I experts who speak at conferences already know this — some audience members remain engaged, while others consider it to be an intermission period, getting up to go to the bathroom or refill their coffee mugs.

But the people leaving the room need to know this one statistic from a McKinsey study of 1000 companies in 50 countries: diverse companies outperformed those that are less diverse by 36% in profitability.

It’s their secret weapon. You don’t care about increasing diversity? OK, well how about money? If there was a widget that could increase your company’s profits by 36%, you would buy it, wouldn’t you? The idea is you could do the same thing at no additional cost by making your potential hiring pool more diverse.

Even in smaller teams of four to five people, having a diverse member can give you an edge over other competitors. Having a female or ethnic minority on your team — especially someone who speaks a foreign language — can help you reach untapped markets.

Of course, it’s not as easy as installing a widget. These are people who want to be heard in company meetings, feel connected with team members, and get invited to the next lunch outing. They want to feel respected and included, which is where things get difficult.

The McKinsey study that everybody quotes also reveals that a company’s approach to inclusion determines if a company gets those profits. Otherwise the needed diverse talent is lost.

Sentiment towards inclusivity is much more negative than sentiment towarddiversity. Overall sentiment on diversity was 52% positive and 31% negative, but sentiment on inclusion was markedly worse, at only 29% positive and 61% negative.

“This encapsulates the challenge that even the more diverse companies still face in tackling inclusion,” the study states. “Hiring diverse talent isn’t enough — it’s the workplace experience that shapes whether people remain and thrive.”

Before getting into talent retention, though, here’s how diversity can increase profits - even at small mortgage companies.