Unlike in standard i.e. retail business (private customers and business / commercial customers) where sales has a task that is strongly focused on implementation, in individual business (private banking and corporate customers) it is much more challenging to work out a valuable positioning for sales management. The challenges lie not only in the more complex customer structures or customer groups, which are more difficult to keep clean in terms of data quality but are also more difficult to evaluate (and analyze) in a structured manner and also – driven by the more demanding / complex customer needs – in the different working methods of sales.
In the understanding of this post, the account manager is clearly assigned to his or her customers. He fulfills a role as a so-called relationship manager (RSM) and is responsible for comprehensive support and sales to his customers. He is responsible for ensuring that his customers are offered all relevant products from their bank or savings bank at the right moment. He is the face to the customer and responsible for answering customers‘ questions and inquiries or directing them to the right places. At the same time, it is derived from his holistic customer responsibility that it is also his task to follow up open questions and topics, including the respective leads and sales approaches, i.e. to stay tuned from a sales perspective. It is also part of his job to document relevant information from discussions with customers in a suitable form and thus make it available to other specialists and colleagues in the organization. As a generalist, he is responsible for referring to specialists or getting support as required, in accordance with the work instructions of the organization and his own abilities. In the course of this book, different titles may be used for the RSM for reasons of variety, such as consultants or supervisors – if no explicit specialists are named, the broadly based RSM is always meant. In cooperation with sales, the RSM is the central linchpin for sales management; after all, it is the core of work.
Sales demands and needs significantly greater degrees of freedom in individual business than in standard business. These degrees of freedom extend both to the selection of the offered products or product properties and features, as well as in the recognition of potential and addressing the customers.
Experience has shown that product-induced campaigns lead to a lower success rate in individual business than in standard business with comparably intensive data analysis and preparation.
In individual business, good preparation for a sales campaign will only succeed if a person with explicit knowledge of the customer (i.e. the relationship manager) is involved in this very preparation. This leads to a somewhat equilibrium between the controlled and the controller. Due to the information asymmetry, sales steering (or customer segment management) in the (individual) corporate customer business can actually only control those employees who accept to be controlled.
The acceptance of sales management in corporate customer business is therefore a particularly critical success factor.
In order to increase acceptance, sales management must occupy task areas and topics that each contribute to one or more of the following three pillars:
- „Sovereign“ tasks
- Sales controlling (sales steering)
- Sales support
„Sovereign tasks“ are responsibilities that are delegated by a higher authority to sales management. Decision-making powers and competencies are derived from these tasks and at the same time, sales management is firmly on the map (perspective: organizational chart, written order) in the bank or savings bank anchored.
Sales control, or (customer) segment management, is the actual core field of sales management. As a rough overview, it can be stated that sales management can be divided into three major fields of action. These are in detail:
- Reduction of costs, that is, to make sales cheaper
- Increase in income, that is, sell more
- Increase in sales quality, that is, to use the available resources better and more efficiently (simplified: to increase the hit ratio and / or to operate more successful cross-selling)
Sales support are all those topics and tasks through which a sales employee, a customer advisor receives support and relief in their day-to-day business. Sales management can use sales-supporting activities to generate operational and empathic proximity to sales, and to strengthen or support acceptance up to a certain limit.
This triad is important in order to equip sales management with the necessary skills and at the same time to put the sales orientation in the foreground. Sales management geared exclusively to control is perceived by the sales department as an extended arm of the finance department or bank control, and not as a sales tool in its own right. At the same time, there has to be someone in sales who can (also) address uncomfortable truths without being perceived as teaching or cunning. Sales management is (ideally) not about right or wrong, but about continuous improvement and optimization (and activation) – in this respect, the constructive attitude of all those involved is decisive.
An important task for sales management in corporate banking is to claim responsibility for the sales process. Depending on the design, this task can pay into all three pillars. In any case, it is a sovereign task. By defining measuring points in the sales process, a control system can be set up that is based on the activities of the individual RSM. This therefore contributes to the second pillar without restricting the relationship manager’s necessary degrees of freedom. Ultimately, there may also be process steps in a sales process in which sales management provides support in order to make additional contribution to the third pillar.
It is also important for sales management to claim responsibility for pricing policy. This can be reflected in minimum margins for the lending business or in standard prices and condition competencies (for just permissible deviations from these standard prices) for other products / product fields. It does not have to be the case that sales management has sole decision-making authority on pricing policy, but it must have the right to initiate changes and moderate the corresponding coordination and decision-making processes in-house. An ongoing exchange with sales is almost guaranteed across the board through prices and pricing.
Finally, the sales management must ensure that it is permanently close to the core business of the area of responsibility which is being supervised. In corporate customer business with a classic lending focus, this means that sales management constantly keeps an eye on new lending business. This can be done via a centralized pipeline management, via an approval processes for new business, etc. – it just has to be so relevant and core that the sales management is fully integrated. In order for this integration to take place more smoothly (and voluntarily), it is advisable that this is combined with a supportive service (e.g. preliminary check, advice, etc.) for the respective sales colleague.
So the answer to the initial question is: both – but the mixing ratio will always be individual!