MODELING YOUR SUCCESS
Sales Management
Robert F. Grieb

Robert F. Grieb is a Managing Director of the BISA He developed and manages the BISA Sales Management Best Practices Workshops, and works with financial institutions to enhance their investment and insurance programs and overall sales culture.

Email: Robert F. Grieb

 
 
 
 

THE NEW YEAR is now well underway. Budgets have been signed in blood, and we now have our 2008 goals in hand. In many institutions, this process ends up becoming very 'top-down' driven, and managers often find themselves with goals that seem almost unattainable. Small, incremental enhancements often do not seem to be meaningful, and this drives managers to a frustrating search for that silver bullet that will enable them to reach their goals.

It may be possible, however, to attain quantum results by aggregating a number of incremental improvements. Simple, quantitative 'models' can help you identify the areas of greatest potential, and generate buy-in and support from your advisors and partners across the institution.

What follows are two examples of how simple models, used to achieve seemingly marginal improvements in areas that advisors can control, may lead to significant overall program gains. Note that the important point is not the specific numbers (which may be very different for each institution), but the demonstration of cumulative impact and use of a simple modeling process.

Enhancing referrals

My BISM Autumn 2004 "Sales Management" column focused on developing effective referral programs. It included a model showing a way to calculate the value of such a program to an individual advisor as well as the institution as a whole. Using a similar approach, let's examine the potential impact of small, manageable improvements in various steps throughout the referral and sales process at a hypothetical institution. These are conservative numbers based on inputs from numerous program managers over the past year.

Now, let's look at what we might, with some focused coaching, be able to do with incremental improvements to this referral-sales process.

Average first-year client investment. We can raise this average ($40,000) by teaching advisors to do a better job of profiling and by asking clients about their non-bank assets. We can help advisors take a more 'planful,' holistic approach with clients. This might require an additional step in the sales process, but it should result in a higher average first-year client investment. With specific training, it is not unreasonable to assume a 10-percent increase in the first-year average.

Percent of referrals that result in a meeting. This figure (60 percent) can be improved with additional training for branch personnel to help them recognize real customer interest and opportunity. Also, advisors (or their assistants) can be trained to do a better job at working referrals. Some additional management attention to advisor (assistant) follow-through activities can help significantly here. A small increase to 63 percent should certainly be achievable in this area.

Percent of meetings that result in sales. This is where individualized sales (process) training for advisors can have a great impact. In addition, better training of branch personnel can lead to higher quality referrals that will be easier to close. By working with his/her advisors, a manager should easily be able to help the advisors increase this ratio by at least three percentage points-from 60 percent to 63 percent.

Number of referrals per branch per week. My guess is that virtually every branch can provide more qualified referrals if branch personnel are properly trained and give referrals a high enough priority. Work with retail management to ensure that time is allocated for the additional training, ongoing monitoring, and management of this area. You should be able to get each branch to commit to one additional 'quality' referral per week (up from three per week).

While each of these items may, on their own, seem relatively insignificant, the cumulative impact can be great. The following table shows how these small increments combine to yield significant gains for the individual advisors and the total program.

As shown in the table above, the small incremental enhancements discussed provide a cumulative 62% increase in profits to both the institution and income to the advisor.

Annual portfolio review

At recent BISA Sales Management Workshops and the inaugural Bank Financial Advisor Program, there was much discussion on how advisors can better 'work their books.' An important element of this that can clearly (and often easily) be improved with training is the annual client review. Properly positioned with the client, and properly prepared for and executed by the advisor, the review can lead to significant direct and indirect business development, as well as much-appreciated customer service and an enhanced compliance picture. No matter how much this area has been talked about, the vast majority of advisors still fall far short. Yet, it is one aspect over which they have almost total control.

Rather than discuss in detail the numerous techniques that might be used in this area, let's look at a quantitative model to show the potential impact of a solid annual review program, which can be adjusted and applied to specific situations.

Even if only some of your advisors provide just a portion of the potential business shown, the cumulative impact can be significant.

These are just two examples of how very controllable and seemingly small enhancements can add up to significant gains for your overall program, as well as the individual advisor's income. The key takeaways of this article should not be the specific examples, but rather the conceptual approach:

• There are many areas in which incremental enhancements can be made.
• The cumulative impact of a few incremental enhancements can be significant, and in some cases 'quantum.'
• With simple quantitative modeling, you can more clearly demonstrate where and how significant results can be obtained.

I encourage you to create your own models to help identify areas with the highest potential for focus. The models also become valuable tools to help create understanding, buy-in, and commitment from your advisors and other participants within your institution. You might also sleep a bit better knowing that those 'unreasonable' corporate goals just might be achievable after all.