Mortgage Lender Improves Customer Satisfaction with ...



Overview

Country or Region: United States

Industry: Financial services—Mortgage

Customer Profile

Headquartered in Orlando, Florida, Pinnacle Financial is an independently owned mortgage lender with 650 employees, providing more than U.S.$3.5 billion a year in home financing.

Business Situation

Employees located in mortgage branches did not have access to a complete set of e-mail communication capabilities, affecting their ability to effectively manage communication from customers.

Solution

Pinnacle Financial upgraded to Microsoft® Office Professional Edition 2003 to improve remote e-mail access, provide immediate notification of incoming messages, and offer better e-mail organization.

Business Benefits

■ Improved customer service—95 percent of customer-initiated reminders eliminated

■ Streamlined loan application processing

■ Enhanced productivity from better e-mail management, saving almost 3,700 hours per year companywide

■ Reduced IT support effort | | |“We can provide better customer service with Outlook 2003…we let the customer know when the request will be done, and we set a Quick Flag follow-up alert so that the request is completed on time.”

LaDonna White, Senior Vice President of Customer Service, Pinnacle Financial

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| | | |Pinnacle Financial is a direct mortgage lender that provided more than U.S.$3.5 billion in home |

| | | |financing in 2004. The competitive, fast-paced business of mortgage lending demands rapid processing |

| | | |of a loan to ensure customer satisfaction. But Pinnacle Financial employees located in the branch |

| | | |offices were limited in their e-mail management capabilities, which prevented the use of solutions |

| | | |that could help enhance their customer service capabilities. The company deployed Microsoft® Office |

| | | |Professional Edition 2003 to take advantage of improved remote access, search, and prioritization |

| | | |capabilities provided by Microsoft Office Outlook® 2003. This helped Pinnacle Financial employees |

| | | |respond more quickly to customers. The solution was estimated to provide an estimated 140 percent |

| | | |internal rate of return based on the benefits and costs of upgrading to Office Professional Edition |

| | | |2003. |

| | | | |

|Financial Benefits | | |[pic] |

| | | | |

|Net present value per user | | | |

|U.S.$570 | | | |

| | | | |

|Net present value | | | |

|U.S.$220,000 | | | |

| | | | |

|Internal rate of return | | | |

|140% | | | |

| | | | |

|Payback | | | |

|8 months | | | |

| | | | |

| | | | |

Situation

Pinnacle Financial, established in 1988, is one of the largest independently owned mortgage lenders on the east coast of the United States. It has grown steadily and now provides more than U.S.$3.5 billion per year in home loan financing. The company uses its own resources to process, underwrite, and fund home loans while giving each Pinnacle Financial office control and decision-making authority. This independence translates into a promise to provide customers with fast, efficient, and affordable financing—what the company calls the “Stress Less Mortgage GuaranteeSM.”

To keep its promise and differentiate itself from competitors, Pinnacle Financial must provide superior customer service and communicate quickly and effectively during every step of the mortgage process. Efficient e-mail management is critical to ensuring effective communication and a high level of customer service.

E-mail has replaced the telephone as the primary mode of communication in the mortgage process, and some Pinnacle Financial employees spend 90 percent of their workweek writing and responding to hundreds of e-mail messages. Employees need the best possible e-mail organization and search capabilities to service customers quickly and to reduce unproductive time. It was estimated that some employees received more than 400 customer reminder messages per year, requiring follow-up action.

Customers demand timely response to inquiries, therefore employees needed to be immediately alerted of certain e-mail messages to ensure rapid follow-up. Customer service specialists must process changes to customer personal information in a timely manner. Loan closing coordinators must be alerted immediately of incoming e-mail messages in order to meet wire transfer deadlines; otherwise, a loan closing may risk being delayed. A happy customer turns into a disgruntled customer with the delay of a loan closing.

The founders and primary shareholders of the company, Doug Long and Jeff Vratanina, have implemented an IT infrastructure based on the philosophy that employees should be able to perform all their work tasks from any location with only an Internet connection. This generates tremendous infrastructure savings.

Employees in more than 50 branch offices used Internet connections rather than wide area networks to access e-mail. They managed their mailboxes using Microsoft® Outlook® Web Access with Microsoft Exchange Server version 5.5, which did not provide access to many of the e-mail functions used by corporate employees. This hampered the ability of branch employees to effectively manage their e-mail.

Additionally, branch employees constantly required assistance from IT support to clean up their mailboxes.

Solution

Pinnacle Financial decided to improve its responsiveness to customers by:

■ Upgrading from Microsoft Office 2000 Professional to Office Professional Edition 2003. This allows branch employees to take advantage of the new communication management features of the Microsoft Outlook 2003 messaging and collaboration client.

■ Upgrading the network from Microsoft Windows NT® Server to the Windows ServerTM 2003 operating system, the foundation of Microsoft Windows Server SystemTM integrated server software.

■ Implementing Active Directory® service.

■ Upgrading from Microsoft Exchange Server version 5.5 to Exchange Server 2003.

The desktop upgrade image was prepared in only a few hours, and the IT staff installed the Office upgrade manually. They upgraded six desktop computers per hour with almost zero downtime for the business. Because of the ease of the upgrade, the cost to deploy was only $6 per desktop for the 400 desktops. This cost includes IT time related to the upgrade of the Microsoft Office System and does not include software license or server-related costs.

The main advantage of the new desktop solution is that users working in mortgage branches or traveling now have the same Outlook 2003 user interface and features as corporate users have. This is enabled by connecting over the Internet using remote procedure call (RPC) over HTTP. In addition, the new notification features, better searching capabilities, and Quick Flags for follow-up help employees prioritize their work and respond quicker to customer needs.

Benefits

Outlook 2003 has helped Pinnacle Financial:

■ Improve customer service.

■ Streamline the mortgage process.

■ Improve employee productivity.

■ Reduce IT support costs.

Improved Customer Service

Within the Loan Servicing department of Pinnacle Financial, constant requests for administrative updates to loans are received from customers and investors. Senior Vice President of Customer Service LaDonna White says, “We can provide better customer service because we are better organized with Outlook 2003. When customers send us a change request, we let the customer know when the request will be done, and we set a Quick Flag follow-up alert so that the request is completed on time.” The number of follow-up reminders received by some employees from customers has been reduced by almost 95 percent—from more than 400 per year to about 25 per year.

A retail mortgage closing coordinator at Pinnacle Financial is responsible for preparing the mortgage paperwork for the closing attorney. The coordinator has a cutoff time to process the paperwork for wire transfers. Because he is immediately informed of incoming e-mail messages from loan processors, he can complete and send the closing paperwork to the closing attorney approximately 10 minutes faster than he could before using Outlook 2003. He is able to reduce the chance of missing the wire transfer deadline and a subsequent postponement of the home mortgage closing because the paperwork was not completed on time.

Streamlined Mortgage Processing

Throughout every step of the mortgage process, Pinnacle Financial employees are able to improve responsiveness and drive toward providing a Stress Less Mortgage for customers.

Enhanced Work Force Productivity

Internal customers are also being served better. Rick Q. Chin, Vice President of Technical Services, explains how he improves his service to his internal customers: “For the items that I flag, I deliver a higher level of service. I flag everything from our key executives. I use Quick Flags to prompt me to provide a status update to executives, so they are more informed and confident that tasks will be completed.”

Because of e-mail alerts, the security administrator can respond to internal customers up to 60 minutes faster and reduce downtime for users waiting for resolution of a security issue.

About 70 percent of those surveyed within Pinnacle Financial agree or strongly agree that they are better equipped to prioritize their e-mail since using Outlook 2003. When remote users began to use Outlook 2003, response was tremendous, says Chin: “The deployment of Outlook 2003 silently broke down a barrier within the company between the haves—those in corporate—and the have-nots—those accessing e-mail remotely from their mortgage branch. Before Outlook 2003, the people who work in the branches came to the corporate office and saw features that they couldn’t use. Now, they can use rules processing, delete a block of e-mail, and perform other tasks that they couldn’t do previously.”

The time savings with improved searching, organizing, and prioritizing of e-mail is estimated to be more than 3,700 hours per year companywide for Pinnacle Financial. This time can be redirected to spending more time with customers, reducing the loan process time, and providing a higher quality of service to internal and external customers.

The benefits of the increased productivity related to Outlook 2003 alone generate an internal rate of return (IRR) of 140 percent and payback in eight months based on the deployment and software license costs of the entire Office Professional Edition 2003 upgrade.

Reduced IT Support Costs

The IT staff is saving 100 hours per year that the group previously needed to support remote e-mail users. Prior to the deployment of Outlook 2003, remote users were unable to easily select and delete a block of e-mail, making cleanup of e-mail too time consuming. Thus IT had to clean up these users’ e-mail as they ran out of storage space. Now, improved management capabilities enable remote users to clean up their own e-mail, eliminating this task from IT support. IT can spend the time saved on knowledge base creation, training, and other value-added services for the organization.

Sheena Hurd, Security Administrator for Pinnacle Financial, believes that the Outlook 2003 features help her sort through the overload of information caused by the hundreds of e-mail messages that she gets on a daily basis. She is able to file e-mail when received and uses her follow-up folder to manage her tasks. “As a security administrator, I keep every e-mail message as a paper trail of all my communication,” Hurd says. “Each search can be up to 10 minutes faster with Outlook 2003. This makes a big impact because I have to search my e-mail folders a couple times every day.”

How Benefits Were Measured

Navigant Consulting, Inc., an independent consulting organization, performed a cost and benefit analysis to determine financial measures associated with the investment in the Microsoft Office System solution. When determining costs and benefits, the value of the labor time was included.

The costs calculated include:

■ Software licensing.

■ Hardware.

■ Training (help desk, IT, and end users).

■ Deployment (strategy, imaging, add-ons, rollout, and installation downtime).

■ External professional services.

The following are some of the business improvements that were used to help calculate the benefits:

■ Reduced IT support of Outlook.

■ Time saved organizing and prioritizing e-mail messages.

To determine the cost of IT time, labor time was multiplied by the fully burdened hourly rate for IT staff. To determine the value of time saved, labor time was multiplied by the average fully burdened hourly rate for the employee population.

Using established cash flow analysis, standard financial data was measured over a three-year period (see Figure 3) including: payback, the time that it takes a company to recoup its investment in the solution; net present value (NPV), the total value to the customer from investing in the solution, expressed in today’s dollars; NPV per user, the NPV divided by the number of users affected by the solution; and internal rate of return (IRR), the rate of return that equates the present value of cash flows to zero.

While every organization has unique considerations for economic analysis, this case study highlights key areas where economic value has been realized from the Microsoft Office System.

Microsoft Office System

The Microsoft Office System is the business world’s chosen environment for information work, providing the programs, servers, and services that help you succeed by transforming information into impact.

For more information about the Microsoft Office System, go to:

office

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“For the items that I flag, I deliver a higher level of service…I use Quick Flags to prompt me to provide a status update to executives, so they are more informed and confident that tasks will be completed.”

Rick Q. Chin, Vice President of Technical Services, Pinnacle Financial | |

Figure 2. The main steps of the mortgage process can be improved by using the communication features of Outlook 2003.

[pic]

Step |Business Process |Feature |Business Process Improvement | |1 |Lender receives loan application from customer. |RPC over HTTP, Search Folders |Branch-based loan officers have access to all Outlook features. They are able to create Search Folders to track all communication related to an applicant. This saves administrative time that loan officers now can spend providing personalized service to their customers. | |2 |Lender processes loan, performs appraisal, survey, credit report, and title search. |Favorite Folders |Loan processors can have easy access to their most frequently used e-mail folders, to help reduce the loan cycle time. | |3 |Underwriter verifies that loan application complies with corporate guidelines. |Desktop Alerts |Underwriters can be informed immediately when information is received from compliance officers. This helps them process requests more quickly. | |4 |Loan documents prepared by lender are signed. |Desktop Alerts |Closing coordinators are informed immediately when the loan process is complete. They can forward paperwork to the closing attorney 10 minutes quicker, which reduces the risk of a delayed closing. | |5 |Lender services loan handling collections, requests from customers, and other tasks. |Quick Flags |Customer service flags a customer request, which improves the response to customer requests for corrections and reduces the number of customer reminder messages by 95 percent. | |

Productivity Star | |[pic]

LaDonna White

Senior Vice President of Customer Service, Pinnacle Financial

“In a service business such as mortgage, it is all about providing the best possible customer satisfaction. When I receive a request from a customer, I immediately flag it and tell the customer when the request will be completed. My customers love getting that assurance that their requests were received and will be taken care of in a timely manner. I’d like to think that this dependable customer service helps differentiate our offering and drives my company’s profitability.”

| |Individual Profile: LaDonna White heads the Pinnacle Financial Loan Servicing group that manages more than $3.5 billion of loans originated per year. After a mortgage is closed, her group is responsible for the customer relationship. She collects payments, provides reports, and manages requests from customers and investors.

Business Challenge: Every month, customers and investors flood her mailbox with thousands of e-mail requests to make administrative updates on loans. After Pinnacle Financial mails annual Mortgage Interest Statements to customers, customers send e-mail messages with corrections to addresses, Social Security Numbers, and other personal information. White’s customers want to know that their requests have been received and when the work will be done. Because the volume of e-mail is overwhelming, White needed a solution that would help her organize her tasks and reduce her Inbox to a manageable size.

Solution: White now uses Microsoft Office Outlook 2003 to provide the best possible customer service and to manage her mailbox. “I am much better organized with Outlook 2003,” she says. “When I receive a request for a change, I let the customer know the date that it will be done and set a Quick Flag follow-up alert so that the request is completed on time. I also file the message in the appropriate Outlook folder. My customers are receiving the best service possible, and this has improved our customer satisfaction.” The number of follow-up reminder messages received from customers has been reduced by almost 95 percent. | |

Figure 3. Pinnacle Financial estimates positive cumulative cash flow in approximately eight months, based on the calculation of costs and benefits of the Microsoft Office Professional Edition 2003 upgrade.

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| |Software and Services

■ Microsoft Office System

− Microsoft Office Professional Edition 2003

■ Microsoft Windows Server System

− Microsoft Windows Server 2003

− Microsoft Exchange Server 2003 |Technologies

− Active Directory

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© 2005 Microsoft Corporation. All rights reserved.

This case study is for informational purposes only. Microsoft MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS SUMMARY.

Microsoft, Active Directory, the Office logo, Outlook, Exchange, SharePoint, Windows, Windows NT, Windows Server System are either registered trademarks or trademarks of Microsoft Corporation in the United States and/or other countries. All other trademarks are property of their respective owners.

"NAVIGANT" is a service mark of Navigant International, Inc. Navigant Consulting, Inc. (NCI) is not affiliated, associated, or in any way connected with Navigant International, Inc., and NCI's use of "NAVIGANT" is made under license from Navigant International, Inc.

Document published April 2005 | | |

For More Information

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For more information about Pinnacle Financial products and services, call (407) 578-2000 or go to:



Figure 1. Pinnacle Financial users have substantially improved communication with Outlook 2003, according to an October 2004 survey by Navigant Consulting.

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