Automation and Retention
May 31, 2022
By Hoyt Mann
The Great Resignation continues into 2022. In fact, CNBC reports that 4.3 million people quit their jobs nationwide in January, with 11.3 million job openings available. And while the causes and results remain the subject of widespread research, the fact remains that, even in relatively stable industries like financial services or real estate, recruiting and hiring have become more challenging.
Title agencies and settlement services business owners, in addition to struggling to find new hires, are at the same time looking down the barrel of an inevitable decline in overall order volume. The mortgage industry will not repeat an overall origination total likely to settle at over $4 trillion from 2021. And yet, in spite of the overall decline in volume, the vast majority of forecasters and economists agree that we could see near record numbers of purchase volume this year.
Business owners in the title industry, therefore, are facing a unique dichotomy: a need for stable or even increased service levels balanced by a reduction in order volume and potential labor shortage. While there are several effective strategies available to counter this potential problem, time is of the essence for businesses seeking to successfully compete for market share.
The Seeds of Retention
One strategy likely to be adapted by title agents is accepting the labor shortage and believing that it will likely be with us for some time. Some observers have suggested that one root cause of The Great Resignation has been the early retirement of a significant amount of Baby Boomers, spurred on in part by pandemic conditions. That generation, of course, makes up a significant percentage of the overall labor force, so a disproportionate number of retirements, early or otherwise, would amount to a game changer for the short term at least.
For agents and owners accepting that the labor pool will remain shallower for a year or more, the alternative has increasingly become a strategy of retention: keep the skilled employers one already has. The challenge, naturally, will be that, as others grow more desperate for skilled recruits, the incentives to hop from firm to firm will be sweetened. Thus, any effective retention strategy won’t just start with compensation. Instead, empowerment and engagement will need to be baked into the policies, procedures and workflows used by the most successful title agents.
Jay Zagorsky, senior lecturer of Questrom School of Business, Boston University, provided some perspective on this approach.
“High annual quit rates mean many workers are not satisfied with their job’s pay, benefits, or working conditions,” he said in Fact Company. “And that can be a huge waste of time and money for both companies and workers. Hiring and training workers is expensive.”
Zagorsky went on to explain the most proven approach to keeping one’s employees.
“Research shows employers can minimize turnover through many different methods, such as by giving workers a sense of purpose, letting them work in self-directed teams, and providing better benefits,” he said.
While Zagorsky was speaking of universal principles, they certainly apply to title agencies and title-related businesses. Engaged employees are empowered employees, given the tools to solve complex problems and even take limited, qualified risks. That starts with the way in which a business builds its workflow, and filters into its organizational chart and job descriptions. Then, of course, the execution must be consistent.
Retention Via Automation
Another powerful manner to engage and empower employees is to take away the simple, unchallenging tasks or functions that take up part of their workdays. The settlement services industry, for any number of reasons, remains mired in manual activities on a day-to-day basis. Data entry, rekeying, manual information seeking and similar tasks which require little innovation and can foster an almost assembly line style of mentality are not the job functions advertised when a title agent recruits talent. And yet, from the owner to the escrow assistant, an amazing number of title agencies still depend on manual activities that could otherwise be automated.
Automation of basic tasks not only improves efficiency and productivity (most technologies can be applied on a 24/7 basis, as opposed to humans), but removes the most mundane responsibilities from the very employees agents are trying to retain. This frees them to take on more challenging, and presumably, enjoyable tasks. In so doing, agents and owners can even elevate their service levels. Consider, for example, how often title agency staffers take phone calls from real estate agents or borrowers seeking to find out when a closing is scheduled. How much time would be saved and returned to the staff to focus on marketing or sales efforts, or even doing more advanced client service? How much time do qualified employees spend keying data into a production system instead of following up on more complex issues? The recapture of that time not only helps to increase employee satisfaction (and likely, retention). It also makes a business more effective and productive, mainstays for businesses seeking to capture market share in a competitive cycle.
Moving Beyond ‘the Way We’ve Always Done It’
Finally, title agents and owners will need to go beyond “what we’ve always done” as the labor pool shrinks and the market grows tighter. That does not just mean strategic and widespread automation as well as resource strategies empowering existing staff. It can also mean going beyond traditional channels and sources to recruit. As the Great Resignation continues, many Americans are quicker than ever to leave unsatisfactory jobs for greener pastures. The title industry, historically, hasn’t been a power recruiter for professionals from other industries. But it can become, and should become one. Human resource and recruiting strategies common in other fields will very likely become more commonplace in our own because of the conditions that are emerging. We may also see more savvy title agents providing more cross training, centralization of operations and even mentorship and professional development programs to increasingly draw young talent from other areas of expertise.
Although the title industry has always been traditional in its ways, the likelihood of a protracted purchase market in combination with a reduction in the existing labor pool will very likely induce some significant changes in the way we do business. We’ve already been moving toward automation and the use of more complex tech stacks, even if just to battle margin compression and improve efficiency. But with the unique conditions starting to emerge, it appears that employee retention and engagement will start taking their place at the top of leadership meeting agendas along with more traditional categories like sales and finance.
Hoyt Mann is co-founder and president of Texas-based alanna.ai, a conversational AI assistant. He is a tech evangelist and title industry veteran who has served the industry for over 20 years, including key roles with RamQuest and PhaseWare, before helping to found alanna.ai. Mann can be reached at hmann@alanna.ai.
Contact ALTA at 202-296-3671 or communications@alta.org.