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Financial Services Special Report: Is your brokerage built for success or failure?

Featured in Irish Broker Magazine - July 2009-09-03

By Dave Malone

“Good times shield us from the truth about the limitations of our sales organisation. However when the financial services marketplace gets tougher those limitations can threaten your brokerages very survival” so says David Malone, Executive Director of Evolve Consultants.

Many sales leaders believe that the answer lies in working harder, asking their team to make more calls or work longer hours however, Malone argues that this may just be akin to mimicking the mouse running on the round wheel, trying really hard but getting nowhere fast. Others turn to sales training in the hope that someone will deliver a silver bullet but that rarely happens. This may seem a strange thing for Malone to say considering his company Evolve provide, among other services, sales training, but he says the truth is that his company have consistently found that answers to poor sales performance are often more fundamental than a sales training can resolve. Furthermore Malone poses some questions which may provide food for thought to owners and directors of Irish financial services firms who want to improve sales performance.

Firstly, as a leader of a company how can you be sure that you have the correct Sales Strategy to maximise your marketplace potential? Do you have the right processes to support a total sales effort? Do you have the right people to drive your business forward – particularly in these tough times? Is your compensation and benefits package designed to deliver the performance you require in a changed Irish financial market?

According to the Evolve model, SALESAUDIT™, they audit organisations sales processes and benchmark their performance. “Often we find that companies recruit the wrong people with the wrong skills set because they have not built a profile of what a successful seller looks like”. Just because they have worked in a successful broker’s office over the last ten years doesn’t necessarily mean that they will be able to adjust to the selling realities of Ireland Inc. 2009” says Malone who asks some further pertinent questions. “Do you know what makes your best performers are different from the rest? What are the behaviours and skills that set them apart? Malone believes that if you know “what good looks like” then you can recruit specifically for those behaviours and skills instead of ending up managing poor performance. Through the use of profiling techniques and robust psychometrics he feels you can get the best people for your brokerage.

There are other questions to be considered too. “Is your remuneration system supporting the development of behaviours you want to see? “One financial services company that we worked with told us that they wanted to encourage lots of team work, yet their commission system remunerated individual performance and in reality encouraged conflict as opposed to sales collaboration. Other companies tell us that they want loyal life long customers and yet their behaviours and structures only reward newly acquired customers and treat existing customers with distain until they leave! Whether you have an acquisition strategy or a retention strategy or both, it must be backed up by processes that deliver...” Malone continues, “The collapse of the property market and the current banking crisis and subsequent drop in living standards, means brokers are finding it more challenging to sell and place lending, pension and credit products. This means they are having to try and cross sell other products to ‘old’ customers, some of which haven’t been contacted since they got ‘that mortgage’ for their ‘commuter belt house’ five years ago”! By designing and supporting the implementation of an account management process combined with an effective CRM system which captures useful information brokers can get closer to customers and bullet proof them from the competition

According to Malone forecasting is a key metric of performance. “Have you ever asked your sales team what sales will come in this month? Forecast accuracy is one of the top traits of top performing sales people. When forecasting some sales people will tell you what they hope to sell this month, but as we all know ‘hope is not a strategy’ others will use words like, think, assumes, feels, believes however the top performers know how the sales pipeline works and use weighted probability to define an accurate prediction. From my experience many organisations are simply measuring the wrong things? Many manage only by measuring results however logic tells us that sales results are a culmination of a number of sales activities, not just number crunching. For example, if your brokerage runs a telephone prospecting campaign, I believe it is vital not just to measure number of calls but to measure quality of those calls. Are your sales people really talking to real decision makers? Do they know who the real decision makers are? Do they know where the real power resides? Are they networking in the right places with the right people? The appropriate sales activities for one financial services company may differ from another depending on whether you have a high street presence or a telephone based approach, or whether you have lending agencies as opposed to general ones. But the bottom line is that you will be more effective if you define those activities and measure them, rather than measuring the end result because by that stage it is too difficult to implement an effective change.

Malone says that the old saying goes ‘if you always do what you’ve always done you’ll always get what you’ve always got’ but that isn’t even true anymore. “The business world is in chaos, approaches that worked yesterday may not work today. We need to constantly reassess whether the approach we used yesterday is still the best approach for today. As a sales leader your ability to create a culture of creativity and innovation into your sales process will be essential to spotting, creating, managing and maximising opportunities moving forward. Is your sales organisation work in progress or set in stone?”

In conclusion, Malone says that while he would love to believe that it is possible to buck the current economic trend sometimes that is not the case. “If your customers are not buying property then you are not selling mortgages - but things will improve. However the key is not to wait for ideal trading circumstances to realign your sales function. Cutting the number of employees you have because sales are down is similar to changing the positions of the deck chairs on the Titanic before it hits the ice berg. It will just delay the inevitable. The only way to stop sinking is to get the fundamentals right – and now is the time to start the process of change. Today you could change the foundations to build a much more effective sales organisation that will out perform your competition and deliver extra ordinary results. My advice is to audit your current sales process and implement fundamental changes that will bring success in the future months and years ahead.”