How Checklists Can Keep Your Bank Safe and Productive

Risk Management

It was at Balad Air Base, Iraq, in March of 2008 – I had been sitting in the dusty little shack for the last five hours and the boredom was REALLY starting to set in. It would have been easy to “rest my eyes” for a bit, but a contentious conversation with my wingman about which burger chain makes the best fries was keeping me awake…barely.  The dusty little shack we were in was called the “Alert Shack”, and it wasn’t much to look at.  It was probably less than 300 square feet, with two chairs, something that resembled a couch, one government-issued computer, a tiny restroom, a brand new 40” flat screen TV (thank you taxpayers) and a box of DVD movies that you’ve never heard of.  Also, the entire place was covered in a thin layer of sand and dust.  That’s the thing about living in Iraq.  Everything is covered in sand - all the time.  Everything.  All of that sand makes the world look brown and dreary. The only bit of color in the room was a bright red telephone that sat just to the left of the dusty computer.  At that moment, that red phone blasted a shrill, deafening ring and we both leapt to our feet.  We made eye contact for a brief moment as my wingman reached for the phone.


Afterburner risk management


Go Time


Thirty seconds later, we were scrambling for two locked and loaded fighter jets –F-16 Fighting Falcons – each carrying 3,000 lbs. of smart bombs, two air-to-air missiles, and the world’s most advanced targeting pod – we called it the Sniper.


As I strapped into my Viper (we call them Vipers because of their similar appearance to the aircraft in Battlestar Galactica and because “Viper” sounds way cooler than Falcon), my hands were moving faster than my brain could think. I began running through a mental list of the actions I must take to successfully launch my aircraft.


  1. G-Suit – Connected
  2. Straps – On
  3. Helmet – On and connected
  4. Flip the power switch
  5. Power on the radar
  6. Test the weapons system
  7. Align the GPS


And, the list went on.


The ritual of scrambling to a combat-ready aircraft was something I had practiced hundreds of time in real life and thousands of times in my head. I was ready for this day and I knew how to get the job done.


Within only a few minutes, all other aircraft were waived off and our two Vipers were cleared for immediate take off from the high-speed alert ramp. Before accepting that clearance we did one last thing as mandated by our procedures - We pulled out our Engine Start, Taxi, and Takeoff Checklists.  Sure, we had already run through this list in our heads, and we’ve done this exact same maneuver many times in the past, but checklists are a part of our organizational culture so we knew we MUST review them.  I’ll never forget that moment as I scanned my checklist and realized…. I never buckled my straps.  I was about to take off in a combat zone, fly at supersonic speeds, through enemy fire and perform highly dynamic maneuvers without ensuring the most basic step of the mission was accomplished. 


Methodological Speed


That’s why we use checklists…because in the heat of the moment, it’s human nature to forget or gloss over even important things. Checklists are a risk mitigation tool that holds us accountable and keep our teams aligned. After strapping in (and double checking!), we pushed our throttles up to full afterburner and blasted off the runway at over 200 miles per hour. 


Fighter pilots, Navy SEALS, Army Rangers and other elite military members fight and win through the use of Execution Checklists.  As an F-16 pilot with over 2,000 hours of flight experience, I have never taken off in a $50 million jet fighter without a checklist in hand to back me up.


The use of checklists has grown exponentially in the civilian world as different industries begin to recognize the value of leveraging such a simple tool.  The first group to truly incorporate the fighter pilot checklist methodology into their daily processes were surgical teams.  In fact, one of the world’s foremost experts on checklists is renowned surgeon and author Atul Gawande. 


In his book, The Checklist Manifesto, Gawande references research that indicates the use of a checklist in the operating room environment can dramatically reduce major post-surgery complications and deaths. Gawande does a marvelous job of expanding the power of these concepts with industry studies that focus on commercial construction and the financial services industry.


The Benefits of the Checklist


There are many benefits to developing and utilizing checklists. Here are a few of the major ones:


Using Checklists in Banking



  1. Hold yourself accountable – checklists provide an easy tool that helps minimize opportunities to fail.
  2. Improve the process – when steps aren’t committed to writing it is difficult to audit and make incremental improvements. Having a checklist forces everyone to think logically about a process and then allows for the comparison of outcomes with the process in order to make formal, incremental changes for improvement.
  3. Training – checklists allows for easier step-by-step training.
  4. Empower your team – checklists provide team members with the power to “speak up” when they sense or see a checklist step being missed or skipped.  Standing behind the authority of the checklist, the least experienced member of any team is empowered to stop action. This empowers everyone to be a risk officer.
  5. Delegation – checklists aids delegation by providing an organized way to split and assign tasks.
  6. Simplicity - A reporter interviewed Albert Einstein. At the end of the interview, the reporter asked if he could have Einstein's phone number so he could call if he had further questions. “Certainly,” replied Einstein. He picked up the phone directory and looked up his phone number, then wrote it on a slip of paper and handed it to the reporter. Dumbfounded, the reporter said, "You are considered to be the smartest man in the world and you can't remember your own phone number?”  Einstein replied, “Why should I memorize something when I know where to find it?”


A checklist allows you to devote brainpower to other tasks. You don’t have to rack your brain and say “What should I do now?”  You can stay focused and  reference the checklist and go about your day.  Checklists are an excellent tool to mitigate task saturation for you and your team.


Checklists at Banks


I know CenterState is a big fan of checklists. They use them for a variety of tasks and often write about them. They use checklists for things like disaster management, loan processing, credit underwriting, sales calls, onboarding, regulatory reviews and ARC hedging to name just a few. One huge benefit they have seen apart from the above is that checklists allow them to systematically build in ways to keep various departments coordinated.


For example, marketing can play a role in the loan closing processes by reminding the relationship manager via a checklist to ask for a testimonial and a referral post loan closing. Underwriting can be reminded to alert the relationship manager of other banking relationships that are found in a borrower’s financials that could be ripe for cross-selling. 


Checklists are an underappreciated and underutilized tool. Teams that effectively apply checklists in their daily, weekly and monthly activities mitigate task saturation, empower team members and provide mutual support. While I am not a banker, I have seen many different organizations succeed by using checklists and believe the methodology has a place at every bank. 


Start using checklists today and watch your team thrive.


Post Script: Guest Post


This guest post is authored by David "Finch" Guenthner Partner at Afterburner, Inc. Finch is a 2003 graduate of the US Air Force Academy holds two Master’s degrees in Military Leadership/Aeronautical Science and current member of the Montana Air National Guard. In 2013, Finch was honored for his now very topical graduate thesis, “Weapon of Mass Information:  Incorporating Social Media in the Information Instrument of National Power,” which was selected for the Future Trends Study Award and named the #1 of 507 graduate theses.


Previously, he served in the Air Force where he Flawlessly Executed 80 combat missions in Iraq and Afghanistan plus was awarded four Air Medals (among various other awards) for his actions. Finch served on the exclusive Air Force One team where he helped manage the movements of Air Force One.


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