Banks across the country are pushing to improve their operating margins, and it's no secret that most are approaching this task from a mission statement perspective. Typically, top management rolls out the tactics in a memo.  But does that "Memo from the Top" propel the action needed to get the job done – or does it stagnate progress?               

When the CEO of a large bank announces plans to slash costs by $1 billion and trim 10,000 full-time employees from the payroll, I wonder if an independent governance committee has been assigned to look at this commitment and audit the end result. Or is it a case of window dressing in order to appease shareholders for the upcoming annual or extraordinary general meeting? After the stock jumps a few cents, the big announcement is forgotten.

I'm not sure how any of the large banks can accomplish their mission without a solid handle on their people, processes and technology. Before managers pursue these sweeping changes, they   need to know exactly how many employees are on the payroll, the number of systems they have in place, how many vendors provide certain types of services and the total number consumers they serve. Is that staff reduction a gross or net number? Often, restructuring on one side is compensated by hiring on the other.

People are always a touchy issue, but operations and technology are an even bigger challenge. In modern times, each of us is looking for the more energy efficient light bulb, the greener car or the e-enabled washing machine that conserves energy. But updating technology systems requires a whole new perspective and, with that "Memo from the Top" calling for reduced costs, few are seriously encouraged to consider new ways to tackle age-old problems of operations or service delivery. To get better results, chances are something has to change.

Maybe it's time to rewrite the memo. In order to maximize the impact of their message, CEOs must be clear and concise in their direction. Most of the better ideas originate from junior and middle management (as they are not scared to challenge the status quo). As such, CEOs must use the memo as a tool to challenge this group to suggest alternative approaches to reducing operational costs. Examples of this may include deploying self-cure tools (such as call drivers to the customer care center) to automate operational problems, retaining existing customers by tracking their behavior or segmenting your social media audience to cross-sell products and apply different pricing techniques.  

So what's the best way to craft a different memo – one that stirs positive, forward-thinking action? For starters, don't focus solely on cost savings. Articulate that you're willing to look at new ideas and projects to help improve margins. This gives managers the leverage and empowers them to tap a fresh wave of thinking which combines economies of scale with cutting-edge technology and an innovative approach to processing that helps meet cost objectives.

Secondly, enlist a team of "new champion challengers" who can support your initiatives. These champion challengers typically think outside the box and are not constrained by the limitations of the organization.  Improved metrics from a champion challenger can then be successfully transferred across the bank. Remember, yours is among the very same banks that taught the world everything about the art and science of consumer and retail banking. So encourage the "spirit" of the memo and not the "words" alone to improve your margins for the sustainable future.

Sankar Krishnan is global client engagement head for banking and financial services at Sutherland Global Services, which provides value-added transaction services to the financial industry. Prior to working at SGS, Krishnan was a career banker with Citigroup in North America and several international locations.