One of the most overlooked and unaddressed issues in the financial services industry – most notably in banking – is around sales leadership and coaching. It is, therefore, one of the biggest opportunities for firms to realize breakout growth.
In our work throughout the financial services industry, we consistently hear executive leaders talk about the need to strengthen their sales leadership, while very few actually commit the time and resources needed to do so. (A recent study showed that only 11% of organizations provide training for their sales managers!) And when they actually do address it, the programs implemented are all too often focused on leadership attributes and qualities rather than the concrete competencies, skills, and tactics that lead to great coaching, enhanced revenue generation, consistent attainment of your goals, and a world-class sales culture.
There are three core areas where we see financial services sales leaders most commonly falling short.
The 3 Biggest Misses
Lack of Accountability
It amazes us to see how many sales managers are not meeting their sales goals, yet remain in the sales manager role. I had a recent conversation with an executive leader who, by the end of the conversation, recognized that he was letting his sales managers off the hook. He excused them for falling short of the number due to all the other priorities on their list, realizing that HE was the one allowing the imposition of those competing priorities. He committed from that point on that meeting the sales goal was the TOP priority for his managers.
Typically a trickle-down effect from the issue above, the percentage of advisors falling short of goal each year is far too high in our industry. Though the self-esteem movement might tell you otherwise, letting people off the hook and not giving them the chance to succeed or fail is NOT the way to motivate and build true self-esteem and a world-class sales culture. The best performers want to be challenged, and if they fall short, are driven to never let it happen again.
Time Spent Coaching – This is a big one and is often missed in two ways!
TIME SPENT IN DIRECT COACHING ACTIVITIES
The average time spent on direct coaching activities throughout the entire sales industry is 45%, with world-class managers at 65% or better. Based on a series of surveys conducted by Greene Consulting, the average in our industry is 20-25%, with the best approaching 40%. Consider the chart below and ask yourself if it is worth making a change here.
Coaching Time Impact on Goal Achievement
TIME SPENT WITH BOTTOM PERFORMERS
Statistics show that most managers spend 80% of their coaching time with poor performers (Sales Benchmark Index, January 2014). How many of those “performers” are going to make it and how vital are they to your success? On average, spending time with your top performers can increase results by 10% or more! And do you know what top performers are looking for and what enhances your ability to keep them? They want you to listen to them, coach them, and challenge them … not leave them alone!
Poor Hiring and Reluctance to Fire
We all know hiring is critical. Effective hiring can take a TON of pressure off you, minimize your headaches, and simplify your professional life. But what are the keys to effective hiring? Define what “good” looks like and then verify in your hiring process that your new hires can – or at least have the potential to – deliver “good.” (See “What is a Competency” video blog)
INABILITY/RELUCTANCE TO MOVE OUT POOR PERFORMERS
This is another huge weakness in our industry. While estimates vary, the average cost of a hiring mistake is up to 5 times base pay, with some estimates suggesting 9 times base pay when you consider lost productivity, impact on morale, impact on clients, time required from you and HR, and the cost to on-board a replacement.
As we hear every day from our clients, HR rules and processes make firing a major, time-inefficient challenge. So how can you address this more efficiently and effectively?
There are certainly more causes for shortfalls in sales leadership, but these, from our experience in the industry are the big three, which if addressed, will take you a long way toward significant enhancement of your sales culture and results.