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| UK Banks Need Tighter Salesforce Scrutiny to Avoid Credit Crunch Callidus Software warns that UK banks will struggle to keep track of sales profitability during the economic slowdown due to unwieldy salesforce management. Optimising the salesforce and sales channel is critical during a downturn. However, many UK banks have not yet put in place rigorous sales performance management practices. As financial services customers react to headlines regarding deteriorating business performance by major financial services providers and seek high quality credit and investment products, the performance of banks' salesforces has come into sharp focus for senior management and shareholders. Additionally many banks are missing out on increasing market share by not incentivising their sales forces to target weaker competitors buffeted by the credit crunch. Based on its experience in the sector, Callidus Software believes that banks are particularly exposed to unpredictable sales due to increased competition, potential falls in consumer confidence and typically highly complex analysis and commission structures. While major sales issues are typically straightforward to identify, the high volume and range of product sales undertaken, from mortgages and savings products to insurance and current accounts, means that UK banks are susceptible to profits 'leaking' through a lack of visibility of minor issues. Putting in place overly complex or unclear compensation structures risks the salesforce and sales channels becoming demotivated and hence underperforming, particularly during a downturn when competition is far tougher. Taking a long-term view, banks also need to ensure that their sales performance management is optimised to enable competitive advantage to be gained when economic conditions improve. The company has identified these top five issues that cripple sales performance for UK banks: • Lack of focus: selling low margin rather than higher margin products, as in a downturn, the easier, high-volume sell can become more attractive; • Lack of control: Keeping track on products sold through multiple sales channels (such as telephone, web and branch networks) and particularly which channels are best suited to individual products can be difficult without systems that provide full visibility; • Lack of compliance: the banking sector has become much more legislated, such as through the FSA's Treating Customers Fairly initiative, but "desperation selling" can lead to non-compliance in selling procedures; • Lack of thought when designing commission structures: salespeople incentivised by poorly thought out incentive plans push higher margin or inappropriate products that do not best match customers' needs; • Lack of clarity: Sales order entry systems that make commissions complex or cumbersome to administer. As a result, salespeople can be prone to taking the easier path if internal systems are a barrier to selling certain products. Callidus Software provides on-premise and on-demand sales performance management software. The technology enables closer management of incentive compensation, tracking of actual sales versus planned sales and more effective product administration across both direct and broker/adviser sales channels. This ensures that corporate objectives are aligned with sales execution. write your comments about the article :: © 2008 Computing News :: home page |