Overcoming the Fear of Selling

By Julie Monahan

Instilling a sales culture takes more than training – it also requires incentives, coaching, performance tracking and top-down commitment.

On the surface, it appears that banks are working hard to transform their branches from transaction sites to revenue-enriching sales centers. Employees are put through one training program after another. They are gathered across departmental and managerial divides to invoke team spirit. But these efforts often merely inject a temporary enthusiasm that disappears once the employees return to the office.

Rousing sales slogans start to fade from memory while entrenched obstacles to selling endure.

The hard fact is that most branch staffers don't want to sell. Some fear alienating customers; others believe selling is dèclassè. A job at the bank has long held an aura of dignity and stability. Many employees, especially veterans, believe an emphasis on selling detracts from that image. And for many, the conflict involves job descriptions – they weren't hired to sell in the first place and are resentful when requirements change.

Even new technology hasn't nudged banks closer to more aggressive selling. On the contrary, some experts say, the technology that makes detailed customer information available to frontline staff actually puts more distance between the selling process and employees, who believe automation will do the job for them.

Progressive banks realize that creating the fabled sales culture involves more than just daylong seminars on sales technique. Training simply marks the beginning of a process that must also include the proper incentives and commissions, coaching and role–playing, weekly sales meetings and detailed tracking of performance. And key to the whole effort is buy–in from the executive suite to the teller platform. "A bona fide sales culture penetrates all levels of the organization," says Chris Holmes, president of National Commerce Bank Services, a consulting arm of Memphis–based National Commerce Bancorp.

Typically, a bank attempting to boost sales ratios will hire a consultant to stage seminars that include motivational speakers and practical lessons on sales technique. Students learn to analyze accounts and identify prospects, employ tools to create a comprehensive customer financial profile, and hone techniques for making offers, either in the branch or by phone. Increasingly, the programs are supplemented with computer–based instruction, reflecting the industry's use of detailed digital customer information. The programs have become so efficient, experts say, that some have been reduced to just two or three days.

But training can't get the job done by itself. All too often, newly energized branch employees quickly find themselves enmeshed, once more, in administrative and operational tasks. Building an effective sales culture requires shifting those duties out of the branch. It also requires financial incentives that reward the right kinds of behavior. Ideally, institutions should shift to commission–based compensation. But employees in this industry are accustomed to receiving steady paychecks, and institutions have found it difficult to implement variable compensation arrangements. Short of that, banks need to introduce effective incentives into their compensation schemes.

Managers also need to maintain the enthusiasm generated in the initial training sessions. Experts in the field recommend regular reviews of employee performance, with frequent coaching on sales management techniques. Finally, senior managers need to get involved by measuring, evaluating and supporting ongoing sales activity.

None of this is easy to do, and all of it requires persistent management attention. Executives must steel themselves for a prolonged effort. "Building a sales culture is not a magic bullet or a panacea," says Rex Coble, director of market builder services at RSM McGladrey Inc. in Des Moines, Iowa. "It's not just a matter of bringing in a high-priced consultant for training. Rather, it's a process you have to work on everyday."

Changing Behavior

While bankers have been trying to instill sales cultures in their organizations for at least a decade, the effort takes on new urgency in an era when institutions apparently are reaching the limits of bottom line improvements that can be garnered from expense reduction and downsizing. The key to strong performance in the next decade will be core revenue growth, which requires a successful sales effort. And that, in turn, requires overcoming employees' fear of selling. "Bringing about lasting changes in employee behavior is a lot more difficult than chopping 1,000 jobs," says sales management consultant Martin Cohen, chairman and chief operating officer of Cohen Brown Management Group in Beverly Hills, Calif.

Training is the beginning of this process and, in some respects the easiest, thanks to a plethora of consultants available to run these programs. Over the years, these consultants have put together well-honed presentations that teach employees the basics of sales management and motivate them to use that learning on the frontline.

There are a few things to watch out for, however. It's not a good idea to provide training only for customer service representatives. To build an enduring sales culture, it's better to provide training for branch managers as well, and give them the responsibility of setting the pace for the staff. "We've found that 80% of what people do is based on what they see their managers doing," says training consultant Kevin Higgins, executive vice president of Forum Corp. in Chicago.

Sales training, however, doesn't help when life at the branch is defined by paper shuffling and handling routine customer requests all day. To combat this problem, Toronto–-based Royal Bank of Canada has been diverting as many operational tasks as possible to designated processing centers around the country. The bank also monitors the administrative workload on a regular basis. "We're always asking if we have allowed administrative work to creep back in," says Anne Lockie, Royal Bank's executive vice president of sales. "It's an ongoing challenge to keep employees focused on the customer."

In any case, operational tasks are no excuse for poor sales performance, according to sales management consultant Nick Miller. "Even if 90% of employee time is spent on operational tasks in the branch, staff can still make a sales impact with the remaining 10%," says Miller, president of Clarity Advantage Corp., Acton, Mass. In Miller's view, managers often set unrealistic sales goals for branch employees. They would do better by following a "reasonable and sustained" activity model, he says, which would drive sales.

In addition to sales activity models, banks need to provide the right financial incentives. This is a complicated topic. Compensation is perhaps the most accurate measure of a bank's progress in boosting sales culture, and incentives are a common carrot dangled by many banks to get employees to sell. "The true test of a sales organization is how sales representatives make money," says Don McNees, managing director of the global banking, investment management and securities practice at Tillinghast–Towers Perrin, New York. "In a selling organization, people make money by making sales; in a service organization, people make money from a base salary."

But financial incentives don't always work cleanly. Oftentimes they cast selling as an "extra" responsibility, separate from the tasks employees were originally hired to do. Employees, in effect, are given the opportunity to decide whether extra money is worth the effort to overcome their aversion to selling – and many answer that question with a "no."

Commission–based pay provides a clearer signal that the organization is serious about selling. But shifting salaried employees to the pressure of commission pay is fraught with difficulty. Some banks fear a wholesale exodus of employees accustomed to a steady paycheck. Cleveland-based National City Corp., for example, is inching closer to commission pay after using incentives for several years. But executive vice president Robert K. Healey Jr., Ohio branch network executive, admits that full-scale commission-based pay "will be tough to implement" at his institution.

Coaching Rules

While National City has been reticent about commission–based pay, it has enthusiastically embraced the concept of coaching as a sale management tool. The bank's managers follow a strict regimen. They routinely review employee work and even record sales encounters, both to review and to facilitate coaching from the next level of management.

"Just as sales staff have to call on their customers, I have to call on the sales staff," Healey says. The process may sound onerous but Healey says it has turned things around for National City, whose sales staff is now evaluated through written reports and by direct observation of customer interaction based on a system developed by Omega Performance Corp., Sausalito, Calif.

"The manager will sit down afterward with the employee, reviewing what went well and what to improve next time," Healey says. A minimum number of direct observations are required every quarter. "We try to give salespeople cues to look for," Healey adds. "We provide tag lines to use with customers such as, 'Are you saving for a home?' " Another sales technique is to ask customers to fill out a short, five–question survey while they're waiting for the teller to complete a transaction.

Kathy L. Berch, Omega's senior vice president of corporate sales, says even the most resistant employee can be coached into playing a sales role. "The manager can't let that person opt out," Berch says. "Once a referral turns into a piece of business and the customer has a smile on his face, the employee understands that selling is not a bad thing." Berch cites the experience of one teller with 30 years' experience who requested retirement because she thought she couldn't sell. That same teller, Berch says, now turns in 40 referrals a month.

Coaching is a simple concept to grasp but actual practice can go awry, particularly when executives try to manage the exchange too closely. Berch says coaching works best when employees get a chance to share their experiences without judgment. "Most managers do all the talking," Berch says, describing that practice as "an inhibitor" to open communication and staff development. A better approach is to ask questions first and reinforce preferred behaviors later. Well–coached tellers learn to greet customers with a smile, address them by name, and thank them when the transaction is done – all the while keeping an eye out for a potential referral. But not many actually do it, according to consultant Cohen. The reason? "Self image and fear of failure," he says. Tellers and other branch staff take an emotional risk when trying to sell, a risk that no amount of financial incentive can disguise. Helping employees over these emotional hurdles is a key function of a coach, according to Cohen. "It gives them comfort to know that someone understands."

Fear of selling, in fact, is a substantial obstacle. Too many people still harbor in their minds "the traditional stereotype of salespeople as manipulative, fast–talking guys in loud suits," says RSM McGladrey's Coble. "The vast majority of bank employees can't get their arms around that. They either consciously or subconsciously reject it."

Coble, who conducts frequent surveys of bank sales practices, recommends that employees be shown how sales can actually help customers. "If I could do one thing to help client banks move along the road to a sales culture," he says, "it would be to change the definition of 'sales' in everybody's mind to 'proactively helping customers solve problems.' The key word there is 'proactive.' You have to ask questions to understand where customers are in their decision–making process. Then it's natural for bank employees to facilitate that process."

Focusing on solving problems for customers helps banks shift from their old "product–of–the–month" marketing campaigns to needs–based selling. Salespeople do better, experts say, when they sell a vision of what financial services can deliver. "No one grows up wanting a mortgage," Lockie says. "What most people want is a home." The more banks design an approach that accommodates customer needs, the more effective they are, she says.

Sales staff still needs product training, of course, but an overly narrow focus should be avoided. In March, for example, most banks gear up for a big push on individual retirement accounts, a product–specific effort timed for tax season. This blanket promotion ignores customers who don't need an IRA but have other unanswered financial needs.

Charlene Stern, president and chief executive officer of the Stern Marketing Group, Berkeley, Calif., recommends deeper analysis of customer needs beyond what's available from a data warehouse. More detailed profiling that includes other financial relationships helps institutions fit products to customers, she says.

Management Accountability

Even the most effective sales management system will founder unless the sales mentality permeates the entire company. Holmes, at National Commerce, says shifting to a more aggressive sales culture will change the duties of human resources professionals, branch managers, training staff, and even top management, a process he estimates can take three to five years. "It's more complicated than it appears," he adds.

The key to the effort is getting managers focused on measuring and evaluating the ongoing sales programs, which doesn't come easily to some banking institutions. "I'm always struck by the reluctance of line sales managers to make clear demands for performance," says Jim Schneider, president and chief executive officer of Schneider Sales Management, Englewood, Colo. In a recent report, Schneider attributes this lack of accountability to banks' fears that they will lose staff by burdening them with aggressive sales goals.

Schneider's client surveys show that 95% of sales managers responsible for coaching and staff development do not receive feedback on their own performance. "In the absence of focused sales leadership at the top, sales unit managers are often let off the hook for poor sales production, for failure to adhere to the bank's sales process, or for failure to develop their salespeople," Schneider says.

One institution that tries to hold managers accountable is BB&T Corp., Winston–Salem, N.C. President Kelly King meets with more than a dozen of his regional presidents every week to review sales activity. Knowing the boss is watching the numbers makes everyone that much more motivated. Since beginning its decade-long transition to an aggressive sales culture, BB&T says it has raised the number of households with five BB&T products from 9% to 26%. The average for most banks ranges from two to three products per household.

While some analysts maintain banks are still behind in maximizing sales potential, advances such as these indicate that the industry is making progress. Many institutions, at least, recognize they have no choice. "After years of cutting all the costs they could, including outlays for branch staff, banks are beginning to realize that they can't cut much further," Schneider says. "It's time to get more productivity out of each person that is there."

Ms. Monahan is freelance writer based in Seattle.

Copyright © 2003 by Banking Strategies, published by BAI.

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