When policies and procedures are not easily accessible, not written with an end consumer in mind, and not consistent across channels and branches, it negatively impacts knowledge management. Read on to learn the four major negative repercussions that can affect a bank or credit union.


One of the major issues with inconsistent policy and procedure documentation is the compliance risk it creates. In the financial industry, compliance is no small matter, and having untrustworthy  information is a disaster waiting to happen. Besides needing information to be consistent and readily available for auditors, failing to provide consistent information to customer service staff can cause huge legal problems for the bank.

Recently, for example, one bank suffered a major compliance hit when an employee allowed one trustee to withdraw $250,000 without the other trustee’s consent. Legally, both trustees on the joint account were required to sign off on any withdrawal. Because the employee was unaware of this policy, he or she allowed the withdrawal without the consent of the second trustee.

Mistakes such as these burden high-level staff and subject matter experts (SMEs) who are forced to fix mistakes caused by inconsistent or inaccessible policy and procedure manuals. In turn, productivity and employee satisfaction suffers.

Moreover, consumers know there is an information consistency problem in banks and credit unions. It is evident in the fact that many consumers will call into an institution multiple times until they are able to talk with a customer service member who gives them the answer they want. Customers know that inconsistent training and inconsistent documentation means the answer they get all depends on the employee they speak to.


In surveys with hundreds of subject matter experts and managers at banks and credit unions: 63% reported that they spend at least one-third of their day answering repetitive questions from front-line employees that are otherwise answered in the policies and procedures manual. Paying a high salary for a top-level manager to answer basic customer questions is not a good allocation of capital, and it’s highly inefficient. With no effective process in place for customer service staff to get fast answers to customer questions, they default to the SME or manager. Thus, productivity suffers.

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Employee Confidence

Another side effect of having a subpar policies and procedures manual is the toll it takes on frontline staff morale. Employee turnover at banks and credit unions is exceptionally high with an average yearly turnover of 32%. When it comes to the bottom line, high employee turnover means higher training and onboarding costs. When it comes to compliance, the same turnover rate can lead to costly errors, putting your institution at risk.

One of the reasons for this high turnover is frustrated employees who can’t find the information they need to service customers, which is what they were hired to do. When front line staff must constantly consult with managers or SMEs to get answers they should be able to locate on their own, their sense of autonomy and purpose comes into question, severely hampering their confidence, morale and drive. Exit  interviews with front line staffers revealed that their top reasons for leaving were:

  • They don’t feel like they are financial experts.
  • They don’t believe they are making an impact.

Customer/Member Experience

Finally, poorly delivered bank policies and procedures can have a profound impact on the end consumer. When customers inquire about certain products either by calling the call center or walking into a branch, it is quite common that the customer service staff member lacks confidence in answering the customer’s question.

For example, if a customer asks about a credit card, the customer service member may become overwhelmed because there are so many credit card products offered through the bank and they have to dig through documentation to find the answer they need. Or a customer wants to open an IRA, but the customer service member can’t find the correct procedure in the manual. So they put the customer on hold — which is on average 15 minutes — so they can ask an SME or a manager.

Not only do these scenarios paint the bank or credit union in a bad light, with customer service staff exuding no confidence in the products they sell, but it further frustrates customers who then have to wait on hold for 15 minutes or more.

For banks that are looking to new revenue models and hoping to turn call centers into more than just service centers, but also sales centers, this scenario poses a huge roadblock. If a customer service staff member doesn’t have the information they need to simply service a customer, they will never have the information or confidence to be able to up-sell them. And if the information they have is incomplete or out-of-date, compliance risks may arise.

What’s the Answer?

In order to avoid these negative effects, banks and credit unions must rethink how policies and procedures are written and delivered to customer service members. Engageware’s Employee Knowledge Management solution centralizes your knowledge. We load, structure, and optimize your content including policy, procedure, and product information to ensure it can be easily found and followed by your employees.

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