I spend a lot of time talking to lenders about technology. One of the things that I find interesting is that when the subject of reporting comes up, the two things we hear the most are grumbles and Excel. Grumbles because they don't like the standard reports their Loan Origination System (LOS) provides, and Excel because that's how they create reports.
Canned (aka standard) reports aren't good enough
Every system comes with standard, or "canned" reports. These were designed to be used by any lender. But they were not designed for you. Every operation does basically the same thing, and has the same general reporting needs: pipeline; new applications; closed loans; exception; and administration. Every lender, though, does things a little differently than their competitors. Your reports should measure the way you do business. The system vendor designs the standard reports for every user - a compromise by design. This disconnect is the root cause of the grumbling. When I was a lender and had to use a standard report, I grumbled too.
What makes a good custom report?
The reports in a robust reporting library possess key characteristics: they are designed for their particular audience; transform data into actionable information; contain only the required data and no more; and are visually appealing.
Different team members have different responsibilities, and reports should be tailored to their needs. The library will have specific versions of the same report, and be designed for a specific audience. Let's use the pipeline report for example. The report for Board/Senior Management will have summary information, and also include a graphical presentation. It is a big picture view. The Department Manager report will have more detail, and slice the information by either production area and/or user. There should also be specific reports for underwriters, processors, and closers. As a general rule of thumb, the level of detail presented increases as you work your way down the organizational structure
Reports are meant to transform data into information, but a well-designed report transforms data into actionable information. They should identify potential risks, or potential opportunities. Let's stay with the pipeline example. If key performance metrics, such as average age of loans in a particular status, or average time it takes a user to perform a defined function, management will be able to act to changes in the environment instead of react. Data sorting is also a good example. If the line user's report is sorted by loan purpose and then by days in process, they can use this to know which files to prioritize. I believe a well-designed, robust reporting library can be more efficient than many of the workflow tools for many lenders.
Well-designed reports contain the information needed, but no more. When creating your library, think about what information is required to effectively act. If the audience only uses a particular piece of information presented on occasion, it is taking up valuable real estate. Presenting only the required information is also key when auditors or regulators are the audience (yes, they should have their own set in the library).
Keeping presented information to the required minimum also enhances visual appeal. Design your reports to be visually appealing - not just for the Board/Senior Management audience. Something as simple as making sure all the fields line up across the page makes for less eyestrain. Line users spend a lot of their day looking at computer screens and documents, and easier readability increases use.
Excel is great - but doesn't replace good reporting
Don't get me wrong - I love Excel. Excel is good at many things, and I use it daily. It does not shine as a report creation tool. Many systems generate a report with Excel as the output, and that is a must-have feature for many reasons. If you are using Excel to create your reports, you are spending significantly too much time on manual data entry, and creating data error risks.
Most LOS platforms have a couple of levels of reporting. Standard reports come directly out of the system, and in many cases are not customizable. Enhanced reporting capabilities are an additional option, provided through a 'data warehouse' model, where LOS data is pushed to a separate database, usually located within the organization. Some vendors provide enhanced reporting as a standard feature. If they do, take full advantage. If they do not, I strongly recommend talking to your vendor about their reporting options. The benefits far outweigh the costs.
The data warehouse provides the source for designing the robust library, and much more. Reports will be designed using either a vendor-supplied or common 3rd party report writer. The data warehouse model also allows you to combine data from multiple sources. Think of combining production and servicing data. This can be done in Excel, but you are back to a time-consuming process with data entry risks.
Designing and implementing a robust reporting library is a significant project, but is key to staying competitive. Transforming data into actionable information allows you to see where you have been, where you are, and where you are going as a successful mortgage lender.