Keeping Pace with an Exploding Industry
Accredited Home Lenders uses Halogen’s Employee Performance and Talent Management Suite to create and manage a pay for performance environment.
Summary
Accredited Home Lenders, a U.S.-based premier mortgage banker, is using Halogen’s web-based eAppraisal to:
- Implement an employee performance appraisal system that is more efficient and consistent;
- Complete all employee appraisals on time; and
- Use dashboard analytics to track progress.
The company also implemented eCompensation to add managerial accountability and tie employee compensation directly to performance.
Company Profile
Accredited Home Lenders, Inc. is a premier mortgage banker servicing all U.S. markets for non-prime residential mortgage loans. The company prides itself on having employees who are the best customer service providers in the industry. Accredited uses technology to provide exceptional service to its customers, including borrowers, mortgage brokers, and investors, while striving to provide a stable and rewarding work environment for its employees.
Challenge
In the early-mid 2000’s, the mortgage industry faced rapid growth, and Accredited Home Lenders grew along with this trend. In 2003 and 2004 the company’s population ballooned by approximately 25 percent annually. “With our exploding workforce, we realized that we needed to implement an employee appraisal system that was more efficient and consistent,” says Sarah Lester, HR representative for Accredited.
Prior to this, Accredited Home Lenders used a manual, labor intensive appraisal process. It was anniversary-based, meaning that on the anniversary date of the employee's hiring or of their last promotion they would receive a review that was captured using Microsoft Word. Managers would enter the various criteria they wished to rate the employee on, score them from 1-5, and provide some limited written feedback. The results would then be presented to the employee along with a merit increase. “The appraisal process was hugely time-intensive, and we realized that we were not leveraging the value that was possible, in terms of providing employees with information that could truly help them develop,” says Lester.
The team also wanted to standardize the feedback process. “For example, a common position in our organization is underwriter. It was possible to have five underwriters being reviewed in any given month and for their scores to vary, but not necessarily because of performance related issues. It would be because each employee was being rated on different criteria, depending on the division they worked in or the particular manager they had,” says Lester. “We needed to standardize this practice and improve organizational consistency.”
Solution
Accredited Home Lenders based its initial vendor selection criteria on industry analyst research and solicited input from company managers and employees on the features they wanted to see. The HR team knew that the appraisal system had to be implemented and managed with little to no support from the company’s IT resources. As such, web-hosting and user simplicity were key factors. “We learned from past mistakes where we were tempted by unnecessary bells and whistles. What we really wanted was a very simple, intuitive system that was housed off-site and could be managed by key individuals in the HR department.”
Accredited also wanted to base their reviews on job title, which was a challenge given that there are currently over 300 active job titles in the company. Halogen was one of the few vendors that had the functionality to quickly implement this.
After selecting Halogen eAppraisal, Accredited Home Lenders embarked on a 90-day training and implementation process. This included: pre-testing with staff to determine levels of technical skill, employee and manager step-by-step training guides, conference calls, personal meetings and group training. “I was surprised and impressed by how easily our managers took to it – there was little resistance from employees to the new system,” says Lester. “Using Halogen eAppraisal is as easy as shopping online!”
Results
Halogen’s solution has significantly improved the employee performance appraisal process at Accredited Home Lenders. Accredited now has approximately 2000 staff members involved in the eAppraisal process. With employees spread nationwide, across 39 different states, they have in excess of 300 different employee evaluation forms in use.
In 2006 the HR team was able to complete all employee appraisals on time – and with a bigger staff than ever. A major factor in this was the dashboard analytics offered by eAppraisal. “In the past, we had issues getting the appraisals in on time as we did not have the capacity to manage the process. Now I look on the dashboard and I can see for example that at a particular time I have 26 percent of my people with completed self appraisals. The only way I could do that previously was if I sat down and counted them manually,” says Amy Moles, an employee relations member involved in managing the process. “I consider it a huge success that within our quickly growing company, we have been able to complete the performance appraisal processes for all eligible employees on time.”
Accredited Home Lenders was so satisfied with the results from eAppraisal that it recently implemented Halogen’s eCompensation solution. eCompensation simplifies and automates the entire compensation management process. It provides all levels of management at Accredited Home Lenders with secure, simple to use tools to allocate merit-based compensation including base salary, variable pay, bonus pay, and stock options.
Prior to adopting eCompensation, merit increases at Accredited were tied to the anniversary date of hire or last promotion. A manager would fill out a form to suggest an increase, but there was no central management of the process. “It was a manual process with no workflow,” says Lester. “Employees were not appreciating the value of the increase or what it meant about them in their career here.”
So when the company moved to eAppraisal it also made the strategic decision to move to a focal merit increase review process. This meant everyone would now be on the same cycle, and the program could be better promoted and managed.
eCompensation allows Accredited to add managerial accountability and tie employee compensation directly to performance. “Our expectation was that, using a 5 point scale, 4s and 5s should be getting two to three times the merit increases of other employees. But before eCompensation there was no one confirming those numbers.” says Lester.
eCompensation has enabled Accredited to refine the process and the timing, and strictly manage it from a departmental budget stand point. It also ties performance directly to the level of increase, so that all employees are aware of performance criteria, and awards are consistent between departments. This has eased strain on the annual budgeting process and assists managers with assessing individual increases.
With eAppraisal and eCompensation from Halogen Software, Accredited Home Lenders has successfully improved and streamlined the employee performance appraisal and compensation process for its growing and distributed workforce. “Halogen has helped us do much more with less,” says Lester. “Now we have the tools at our fingertips to efficiently track and improve our employees’ performance and pay on an ongoing basis.”
