We were recently performing a FOCIS-plus study for a company on the West Coast.  One of the areas of the study is the company's practice of hiring loan officers.  The owner stated that he had used profiling in his hiring practices.  

The practice of profiling has been used, rightly or wrongly, as a mechanism by law enforcement to spot individuals with certain physical characteristics that are similar to other individuals that might have violated the law.  

Since 9/11, some believe the TSA used profiling in the past to increase security scrutiny on certain individuals that have physical characteristics or national origins of terrorists.  Local police agencies have been criticized sometimes for using profiling based on certain characteristic such as clothing, body art or ethnicity.   

Profiling is not a lawful practice, but certain types of profiling may be a useful tool when recruiting and hiring employees for a company.  Let’s be clear we are not talking about physical characteristics when profiling but the behavioral characteristics.  Essentially, what are some of behavior characteristics that may indicate an individual may be a potential high value employee?  Employee value may be measured by productivity, quality and revenue value. 

Let’s explore the use of profiling used by one of our clients as a tool to recruit loan officers.

The first way is to define the elements and standards of a “score card” that will be used to measure the value of a loan officer.  For example, value might be based on closed loan volume, net revenues generated to the company, pull through rate and adherence to mortgage compliance.  

The following is an example of the elements and standards of a high value loan officer:

Minimum Closing per month:  5
30 basis points of net revenue
80% pull through
No more than 10% infraction on compliance

The second method is to monitor the existing pool of loan officers and measure the report card elements.  After a few months of gathering data, loan officers will be ranked by their value.
The third thing is to observe and record the behavior characteristics and work habits of high performers. Don’t worry about the mediocre and laggard group, find the key behavior patterns of the high performers.  For example, high performers may focus on realtors as a source of referrals or they may have a detailed and written sales plan.  High performers may have specific overt behavior characteristics such as high enthusiasm and resilient personalities.  Again we are looking for behavior traits and practices.

The data and corresponding behavior characteristics can be used in designing an effective interview process.  Using the characteristics of the high performing producers, specific questions can be crafted and used to glean information about candidates.  For example:  “Did you develop a sales and marketing plan at your last job?  If so, can you share some of the components of the plan”?  Or, “How do you generate business”?  And finally,   “How many loans did you close last year and how much income did you generate?  Can you provide me a copy of your W2?”  The key is to find out if a candidate has traits and characteristics of a high value performer.

Laggards add little or no value to a company and actually increase risk and cost money to maintain them as employee.  Profiling can be an effective way to recruit high value employees.  Take time to measure the behavior traits and practices of existing high value employees.  Use these characteristics as a tool to recruit more high value employees.