By Patricia A. Machun

The Problem
The bank was losing money.

Loan officers (LOs) at a local bank order appraisals via their loan origination software without charging the borrower as part of his or her initial application submission. Industry standard: get the payment first, then order the appraisal.

This bank viewed it differently. For a smoother client experience, charge the borrower when the loan closed. To counter any uncollected appraisal charges for loans that never made it to the closing table, the bank charged an origination fee higher than the industry norm. The problem? The majority of purchase loans closed; however, up to 80% of refinances cancelled. The bulk of the bank’s business came from refinances. The origination fees collected on closed loans did not cover the cost of appraisals for all the files that cancelled.

A new initiative, for refinances only, required the borrower to pay for the appraisal up-front, not at closing. Unfortunately, due to poor planning and lack of performance support, the LOs found a way to order refinance appraisals without the borrower paying, and the bank continues to lose money.

Let us look at the rollout that led to the LOs finding workarounds to the new policy.

The Initial Rollout
The rollout was of a new policy: to introduce the LOs to new steps in ordering refinance appraisals along with outlining the different ordering policies between refinance and purchase appraisals.

This PT Makeover looks at what prevented the initial rollout from being successful, and, with a makeover, what steps to take today to support the LOs in the new processes and procedures.

The primary barriers with the rollout are discussed next.

No Analysis or Pilot
Not enough time was allowed for a pilot or to analyze LOs’ workflow and their borrowers’ needs.  After the rollout, LOs brought up issues not addressed in the design stage of the process, leading to multiple procedural changes.

 Poor Vendor Management
To order and pay refinance appraisals, the vendor required the LOs to log into a system different from the one they were accustomed to when ordering purchase appraisals without payment.  While the vendor operated each system, it required separate login credentials, obtained by separate departments within the bank. LOs complained of poor customer service from the vendor.

There was a tug of war between old management and new management. The bank was on a very deliberate mission to change the culture of the division. Old guard was fighting to maintain status quo; new management was eager to bring on that change. Typically, they did not respect what each could bring to the table.

While training could have been better by including performance support, due to the factors mentioned above, it alone would not have been able to negate poor planning, an inflexible vendor, and warring factions.

The Makeover
How could the refinance appraisal order initiative been rolled out to support the LOs’ performance? By following the steps in Allison Rossett’s strategy table in Rollouts: How to Handle as a Guide, the rollout would have worked, as it would have helped ask the right questions, developed solution systems, and deliver support where needed.

Analysis and Pilot
If the initiative was fully vetted, allowed for a pilot, and allowed for a better analysis of the LOs’ workflow and their reality, the rollout would have been more successful.

The lack of resolution on key items made LOs lack confidence when working with their borrowers, and policies changed daily after the rollout.

Some questions that came out after the initial rollout were:

  • What happens if the borrower does not have a credit card?
  • My borrower does not want to pay for two appraisals (guideline requirements) until the value comes in from the first appraisal.
  • How does my borrower get a refund if they cancel prior to the appraisal being completed?

A pilot would have uncovered gaps in systems and motivational issues:

  • Gap: Multiple departments assigned logins–one for refinance, another for purchases. Not every LO received his or her sign-on.
    • Solution: Only one department should handle logins; create a checklist to help user setup get correct information.
  • Gap: What processes can we put in place to mitigate any additional work?
    • Solution: A pilot would have uncovered instances where the LO could not order the refinance appraisal, support staff had to. Make it simple, LO order all purchase appraisals, support staff all refinance appraisals.
  •  Gap: How can we help the LOs embrace the change in procedures?
    • Solution: Create a reward system for the first three months. Support staff would enter the LO’s name in a weekly drawing each time a refinance appraisal was ordered correctly.

Vendor Management
By either getting better customer service from the existing vendor or finding a new vendor, the bank would be able to provide a seamless platform for users to order all appraisals.

This would eliminate:

  • Two logins for separate ordering platforms
  • Different ordering procedures

If there really was no way to avoid the two different ordering systems, that department should work closely with vendors to ensure all user names would be recognized. Forgotten passwords or locks-outs should be addressed within three hours.

The bank had contracted with a collaborative network provider to allow support staff to order numerous outside vendor services with the click of a button. While the appraisal vendor has the capability of working within network, it chose not to.

If the appraisal company became a part of the network, it would be a seamless addition to support staff’s role. This would simplify processes by having one procedure to order all appraisals.

Politics have been around since the first three cavemen met. However, the program’s mantra should have been, as Rossett suggests, “What will it take for a successful rollout? What will it do for the employee?”

My makeover primarily involves non-training interventions. The best training in the world would not have alleviated the lack of systems or motivational issues. However, given the number of problems with the rollout, training should have followed up.

Training was treated as an “event,” and not an experience as described in The Six Disciplines of Breakthrough Learning: How to Turn Training and Development into Business Results (Wick, 2006).

A minimum of two follow-up webinars should have been held: one, after the first week; another, after three. This would have solidified the message, eliminated lingering issues, and supported users. After each follow-up webinar, I should have sent out a recap covering common issues and how to overcome them. Part of the final recap would be to develop a job aid to support the users.

Allowing for task analysis and a pilot, workable solutions and consistent policies would have been presented at the time of the rollout, giving LOs the confidence they needed when working with their clients and the systems. Treating training as an experience, not an event, would have addressed any remaining performance issues by coaching the LOs.

Since the rollout, not only has most mid- to upper management turned over, the company as a whole has adopted more stringent project management guidelines. New management understands the importance of weighing processes out and looking at what affects the users and will postpone rollouts.

With a good system, fully vetted polices supported by ongoing coaching, LOs would not have needed to find workarounds.

The bank would not be losing money.

Rossett, A. (2011). First Things Fast: A Handbook for Performance Analysis, 2nd Edition. San Francisco: Pfeiffer [online]. Available at: [Accessed: November 11, 2011].

Wick, P. J. (2006). The Six Disciplines of Breakthrough Learning: How to Turn Training and Development Into Business Results. San Francisco: Pfeiffer.

About the Author
Patricia A. Machun has worked for over 10 years as a trainer and instructional designer in the mortgage industry. She is currently pursuing an MA in Educational Technology at San Diego State University and completed this work in partial fulfillment of her requirements for EDTEC 685 taught by Allison Rossett. She may be reached at