ROUNDTABLE DISCUSSION: Implanting Sales Culture.

Four bankers from different parts of the country discuss how their institutions are encouraging the growth of sales culture--with insight into what works and what doesn't. The considerable rewards, they conclude, are well worth the challenges.

"Sales culture" is a phrase that is heard frequently these days in the financial services industry. Almost every bank says that it would like to create a sales team and a positive "sales culture" in order to improve profitability. But what exactly does this mean? How does an institution go about creating a sales culture? And what has been the experience of banks that have tried it?

How "sales culture" is defined and implemented varies from institution to institution. Bank Marketing magazine asked a roundtable of bankers representing various asset sizes and target markets to define their sales cultures as well as the obstacles and challenges they met along the way toward introducing them.

How would you define the sales culture at your bank?

Davis: I've only been here seven years, and I've watched it change to the point where you can now look at it and identify it. We're now on the road to being customer-driven rather than customer-reactive, and that colors everything. We reach out to the customers and put their requests ahead of our standard daily tasks.

Romero: Accountability is how we define our sales culture. Three-and-a-half years ago, I was with a bank out of St. Louis that merged with Nation's Bank. Up until that point there were two basic elements that were missing from everything we had tried with our sales force. First, we weren't holding salespeople accountable for sales production. It's hard to hold them accountable without the numbers required to keep score. Now, with today's technology, we stay on top of it. Second, we hadn't tied compensation as closely as necessary to sales production. Bank of America now believes strongly in doing both, a concept they call "meritocracy," or more bluntly, "Work hard and you'll get paid for it."

Way: The sales culture we're working toward is based in proactive processes. We're being more proactive because we realized that being reactive wasn't necessarily allowing a sales culture. Instead, we're behaving in a way that provides real service to the customer and it ultimately develops relationship banking.

Fisher: My answer refers specifically to what we call "community banking" at Comerica, which includes the branches throughout our primary market, Michigan. We describe our sales culture as activity-based. This can best be defined by explaining Comerica's program called "superstructure." It's a way of setting goals and measuring progress based on the value of what is sold, versus the traditional way that banks set goals on unit sales. The advantage is that each individual has a goal of creating value and can really sell any variety of products. It's a fairly product-neutral approach. Every product has its own level of profitability, and there's no incentive to sell the wrong product to a customer.

What goes into creating a positive soles culture?

Davis: We start by defining internal expectations. It's a very integrated model, considering that Federal Home Loan Bank didn't traditionally integrate. From a retail bank perspective, we're the closest match to a business-to-business bank. When we initially set up our models and staffing, we used a business-to-business banking model as our parallel.

Part of what goes into creating our positive sales culture is the bankwide awareness that all participants have a very clear understanding of their goals and expectations. We reinforce this with research by going back and asking our customers if we're meeting expectations. For example, right now I'm working on a large survey. We're asking our customers if they think we're offering the right products and services and if they're receiving the quality of service that they've been told they can expect.

Romero: The biggest difference is that Bank of America started paying people to be accountable for results and rewarding them accordingly. We came right out and told them that the better they do, the more they'll earn. With the daily scorekeeping, salespeople now know how many points they have at any given time and exactly how far they are from their goals. We also gave them the confidence to know that we'd coach them.

I mentioned "meritocracy" earlier. It summarizes a lot of what goes into creating our positive sales culture today. We used to have awards banquets to celebrate tenure. The focus of today's award banquet isn't longevity, but degree of success. For example, we make a big deal of our personal bankers when they achieve a million dollars in loan production, which many of them do in the first quarter of the year. It doesn't matter what experience the salespeople bring with them or where they went to school. They have an opportunity to become very successful at our bank by becoming part of the culture and by upholding its values and commitment to growth. The fact that we keep score, pay people well and expect results are all part of how we maintain a positive sales culture.

Way: One key to developing a bank's sales culture is keeping it fun, but simultaneously keeping it customer-focused. To accomplish this, we have numerous programs for all customer-contact employees.

We started off with our in-store branches and hired retail people to go out into the aisles to market the branch. We also use a referral program and a product knowledge program. Then, annually, we have what we call a "Challenge Bowl." It's set up like a game show and the different branches compete against each other to be named Top Product Knowledge Group. It's very competitive, but it's also very fun.

Other programs we've implemented include an incentive program that helps us determine areas of the bank that may need more incentives. Next was our sales management training, which affected everyone from tellers to executive staff members. Elements of this training program all relate back to accountabilities. Every week, the sales managers send in their sales numbers and their answers to specific questions such as, "How many of your salespeople are on target with their goals this month?" and "How are your employees doing with their behavior goals?" I call them and we have discussions based on their answers to those questions.

Observations are also a big part of our sales culture, whether we're observing our telemarketers or a salesperson one-on-one with a customer. If we want to be relationship builders, then we must train our people to do what's right for the customer. We'll get more business based on doing the right things the right way versus working like a used-car salesperson.

Fisher: Probably the most important thing we did was to create a shared vision about the need to implement massive change. Back in 1993, the first thing we did was to create a sense of urgency. With a compelling need to change in a very big way, we looked around at the financial services industry to see how other banks defined their sales cultures. We even looked at retail operations outside the banking industry. For decades we'd been creating incremental change that resulted in single-digit increases. We decided to focus on creating massive change that might result in double-digit increases.

We strongly believed that customer trust was a valuable premise to build upon. From that, we figured that we should stop finding the ideal customers for our products and start finding the ideal products for our customers. That's quite a culture change because, whether they want to admit it or not, most banks grew up product-focused.

Once we understood that products and services were just a means to an end, the solution became obvious. We were convinced that, by focusing on our people skills, we could build a powerful sales culture that was ethical and that would help our customers become successful. I'll bet that most sales managers could point out their best salespeople and find that their one common denominator is people skills.

In evaluating your sales culture, what obstades or challenges did your institution identify?

Davis: We discovered early on that we had very competent bankers who really knew the industry--they just weren't good at making sure their sales culture reflected the needs of their customers. In a traditional correspondent-banking mode, salespeople go out and talk to their customers about all the products they offer. While that was effective, we weren't getting to the specific needs of our customers. Now, we have a framework from which to ask questions. It's certainly not a rigid one, but we have a methodology that we use to gather information and to build a strategy for meeting our customers' goals. For example, one of the single, most powerful questions we now ask is, "Can you tell us about your business?"

Romero: In the past, we were operationally driven. Although we knew the challenge we were up against, we also knew it was time to move the focus away from operations. Today, we are more customer-focused in that we link sales to service. Using technology as one guide, we now have the tools to identify customer needs and are able to move forward more quickly to solve them.

Larson: Our biggest problem has been changing the paradigm. Banking has always been about taking the order and doing what the customer says. It takes a long time to change those routines. Staffing has been another challenge. Trying to find good people is one thing; but then, keeping those people and getting them through training is another.

Fisher: One major difficulty is determining how to talk to customers. In order to help customers with their needs, you first have to understand their needs, and you can't possibly do that without a dialogue Problems arise because sometimes this kind of dialogue really takes employees out of their comfort zones. Since not everyone is comfortable probing people this way, we work on improving that dialogue by sharing insights on what seems to work best.

Can you describe any notable discoveries you made as changes within your organization took place?

Davis: We realized that we needed to do our own needs evaluation. Our sales-trainer helped take us through the evaluation the same way we'd evaluate one of our customers. We discovered that our need to exchange information was great, but we just didn't have the technical training to do it. For example, our group of calling officers used dictating machines and had to send the tapes elsewhere to have them transcribed. It took us an average of six weeks to get a call report summary. Today, every calling officer has a laptop, a modem and a special piece of software.

We also discovered another valuable piece of technology. We knew that if we were doing needs identification, our calling officers would often have more than a single person sitting across the table. So, we supplied all of them with projectors that plug into their laptop. This way they could do modeling and demonstrations right on the boardroom wall without being huddled around a single laptop. If they uncover a customer need during the presentation, it can be addressed quickly and conveniently. Walking into a sales presentation with interactive models and information that's no more than 24 hours old breeds confidence.

Romero: In the old days, I tried to motivate and encourage our calling officers and win them over in any way I could. Even though I'd end up with people who would rise to the occasion, there were not any consequences for the others. I never really had a team that was completely focused on results. While certain team members were especially successful, it was very difficult to differentiate top producers from the others. I've discovered that, as you go through the process of changing a bank's sales culture, you must seek out the people who are really the best at selling the bank's products and services. Associates determine their best niches and applicants are screened more selectively up front based on sales skills and compatibility. In the end, turnover is lower.

Way: I've been fortunate because management was able to dedicate me to the sales management process. In most other cases, sales managers also run branch operations. I would say that having a dedicated person has made the difference between a successful program and an average one. It's allowed me to discover that given the right tools and the right coaching, a sales team can do well.

Fisher: One big discovery we made a few years into building a powerful sales culture is that it's mostly about coaching. I have a weekly sales meeting for all of the branch groups where we review the sales results from the previous week. We exchange incredible amounts of information and that becomes the pulse of the sales culture. In order to sustain and propel a sales culture to new heights and continually aspire for world-class capabilities, a training program is necessary, but it's just one piece of the puzzle.

What have been the end results?

Davis: A fair gauge has been measuring customer contact by the number of sales calls made per calling officer, per quarter. I'm talking about qualified sales calls that don't count if they don't meet the specific criteria. In 1997, each calling officer averaged 38 calls per quarter. That increased to 43 calls per quarter in 1998, 54 calls in 1999 and 55 for the first quarter of 2000.

Also, annually, we ask our sales team to do an anonymous review of their managers. Implementing this was a key part of the sales training we received. As we were changing our structure, we knew we weren't meeting some of our internal goals of coaching and improving the system. After our sales team did their anonymous reviews, there was little question about where we needed to concentrate our efforts.

Romero: After two years of transition, our salespeople are now a whole new group of individuals. In this market alone (Albuquerque), under the category of consumer loans, we've achieved four times what we would have achieved during a good year in the past. It's a win-win situation because it starts with intense customer focus. The entire banking center works as a knowledgeable sales team, holding one another accountable for their share of the results. Everything is tracked through Gallup polls and we've learned the best process for aligning customers to the products that work best for their specific needs.

Way: The whole education process is working well because our customer-service level improves as everybody gets better at the process. It's a win-win situation, The customer is better off because of our training, and we're better off because of the customer's increased loyalty. Sales have never been better.

Fisher: Two years ago, in spite of dosing 120 branches, we created four-and-a-half times more value through branch sales than we did in 1993. The remaining branches created that much more value for the organization than the entire system had created seven years ago. Also, the average balance of everything we sell is larger than it was before. We've become very cost-conscious and it hasn't interfered with our ability to build our current sales culture, We do a whole lot more with a whole lot less.

Are there any changes you would still like to make?

Davis: We're always making changes. For example, we're constantly monitoring our interaction with the customer. We discovered a couple of years ago that we hadn't changed the authorization process. We were still making our customers sign seven different cards, and we had eight databases tracking the information. As of today, we have a single, simplified authorization process and a single database.

Romero: We must continue to identify the right people and focus on building more profitable relationships. From there, we must make sure that we are able to capitalize on those relationships. For example, if we have a customer with a transaction account, as well as a mortgage, our chances of selling other products becomes easier. In other words, we must continue offering customers a well-rounded banking experience.

Way: We are implementing our new sales culture to further integrate investment services into platform sales. Ongoing education and licensing will allow our sales staff to always seek the best solution to our customer's needs.

Fisher: There will always be changes that we'd still like to make. I could brag about the glass being half full, and I'd be happy to do that but it's a work-in-progress--and it will be for the rest of my time here and whoever follows me. There's no world-class sales culture that has reached its destination. It just doesn't work that way. We'll be in a constant process of improvement forever.

Strong sales culture means growth

Regardless of how they're dressed up, bank products have been seen typically as commodities. Accordingly, to stand out in today's fiercely competitive marketplace, banks that create a positive sales culture can differentiate themselves from their rivals. From philosophy to planning, from strategy to tactics, from theory to reality, the power of a positive sales culture cannot be underestimated. No wonder building a strong sales culture is the top priority among banks nationwide. Why shouldn't it be when double-digit expansion seems to be the reward? For those banks committed to growing their culture with consistency in all of the areas addressed by our panel members, don't just plan on growth, expect it.

Deborah Beavers-Moss is a freelance writer with 15 years business experience. She works with the California-based Trade Press Services at (www.tradepressservices.com).