Auto Decisioning – the Right Habit at the Right Time

About a year ago I signed up for a 30-day trial of a “Tried. Tested. Trusted.” “attractive, addictive” “best cardio machine on the planet” (according to the website of this stationary spin bike). Despite enormous desire and effort, I have long struggled with forming and maintaining healthy exercise habits, and I was, perhaps, hoping that this trial would be the right way to auto-decision me into a full commitment.

If you’re not familiar with this “more than a bike,” (my emphasis) it provides an immersive experience that can be enjoyed in the privacy of your home. No need to worry about “keeping up.” You pick your pace. Choose the path. Determine your motivation. Decide the class. You decide your goals and what’s right. The bike’s touchscreen lets you ride with live or live-recorded instructors in a bounty of multi-length, multi-paced classes. You face your instructor and pump along with attendees, virtual or live across the country and beyond. On one side of the monitor you see cleverly named attendees, who can be filtered by age or gender, and in an ever-updating rank by output appears your stats: your zone, heart rate, resistance level, distance, calories, cadence, output, and speed. It was the stats that hooked me.

I’m an analytic. I look for the story in numbers. If by riding at X resistance at Y cadence for Z output I’m inching up in the rankings, then when might I speed to the top of the leaderboard or, at the very least, keep “You’llNeverBeatME” from besting me and consistently being at least one rank ahead of me? While the endorphin rush and psychological nature of competing and winning (if only a personal best) is thrilling on one level, it is the real time metrics, the measurement and reporting over time using charts and graphics of my personal performance that clicked for me.

But how did I take it to the next level? I followed the eight easy steps we’ve all heard before:

Focus on one new habit: spin cycling.
Commit for a minimum of 30 days: my trial period.
Anchor the new habit in an established habit: getting up earlier than my family.
Take baby steps: layout gear each night so as not to disturb the rest of the sleeping household.
Make a plan for obstacles: switching to meditation classes on the app when out of town.
Create accountability: set a personal goal per month and year and track it.
Reward important milestones: the occasional over the top meal.
Build a new identity: OhYesIDidBeatYOU!

A habit was formed.

What does all of this have to do with auto lending? It’s been my experience these past decades that auto lenders are also looking for, and sometimes struggling with, healthier and faster ways to run their businesses. And, that it sometimes takes something like a new product or service to finally interest them enough to engage and give it a try.

A few years back, in response to lenders’ need to speed decisioning and improve the response to their customers, loan origination technology providers released then-new features for automated decisioning and automated restructuring of deals. The features allowed lenders to establish their goals and define the parameters; some allowed the gathering of insights from the actual data that resulted. At that time, despite wanting faster, better decisioning, lenders were hesitant, preferring to rely on the manual decisioning of their underwriters over this new way. However, slowly, not overnight, just as I transformed both attitude and overall feelings about exercise, they transformed both attitude and overall feelings about automation. Many now auto-decision and auto-restructure sometimes as much as 100 percent of their decisions and are achieving their defined goals – whether the goals be increasing the number of won deals or improving the fit of deals in their portfolios.

Today, the customer still remains one of the biggest concerns of lenders. With customers expecting Amazon-like purchasing experiences, how does a lender attract and retain the customers they want? Again, technology and service providers offer solutions. The best solutions are end-to-end, offering a suite of services that include web portals that let the customer shop for a vehicle, apply for the loan, pay for it, and repeat. Through the portals and their end-to-end provider, lenders are acquiring new customers, processing loan or lease applications, automating their approvals, servicing the lease or loan, gathering insight from both their originations and servicing systems, and outsourcing certain business processes such as loan and lease care, lease maturing management, back-up servicing, call centers, collections and remarketing.

And, the best solutions let you pick your pace. Choose the path. Determine your motivation. Block distraction. Decide your goals and what’s right.

Now you decide what your business needs to be healthier. You fill in the blanks:

Focus on one new habit:
Commit for a minimum of 30 days:
Anchor the new habit in an established habit:
Take baby steps:
Make a plan for obstacles:
Create accountability:
Reward important milestones:
Build a new identity: BeTheLenderThatCould!

Make “healthy” such a habit and top priority for your business that NOT doing it is what requires the decision.

Charles Sutherland
Charles Sutherland, chief strategy officer, defi SOLUTIONS, has more than 25 years in technology management and strategy with companies such as Sagent Lending Technologies, Fiserv, and Accenture. At defi, Charles leads strategy, product management, and marketing with a focus on improving the experience of lenders and consumers.