As the bank brokerage industry grows, there is a critical area that is often downplayed - the need for skilled professionals.
Though some banks have tried to build investment programs with staff made up of less costly and less experienced employees, others are now awakening to the need for people of much higher accomplishments.
These banks understand that as products have become more complicated, competition has intensified and the attractive high-net-worth consumer market requires more sophisticated and professional sales staffs.
The needs of financial institutions span the spectrum of the securities and insurance industries: from investment bankers to traders to management.
At this point, however, the most critical need is in sales and sales management. Since most large banks are expanding their sales forces and brokerage firms are also looking to strengthen their sales teams, demand has never been stronger.
Though mainstream securities firms have extensive experience in hiring and managing sales professionals, banks and other new players are just beginning to understand their own needs and what it will take to build and maintain a strong sales force.
For new and experienced banks offering investment services, the task of building a strong sales team involves three primary stages:
Needs analysis. Too often someone who on paper seemed highly qualified turns out to be a bad fit.
Before hiring, a bank must clearly understand what specific skills and talents will best meet its objectives.
How important is outside prospecting? Must the individual have marketing expertise, or will sales be the only job function?
And since interpersonal skills are so important in a financial institution environment, is the candidate a lone-wolf type so common in traditional brokerage firms?
Recruitment and evaluation. There is no magic formula for recruiting sales talent. The use of specific strategies such as classified ads, search firms, in-house recruiters, and referral programs depends on budget, time, and the size of the market for potential candidates.
With a comprehensive needs analysis completed, the challenge is to evaluate sales candidates and make sound predictions about their success.
Evaluation of selling skills, interpersonal skills, management and leadership ability, and product knowledge are just some of the areas that need to be analyzed.
This analysis should be done using interviews with potential managers and peers. The use of written skills and attitude assessment tests can also be very valuable.
Retention. Once a strong team has been built, there are three critical areas that will affect your ability to retain successful sales and sales management professionals.
The first is compensation. There are dozens of ways to structure a compensation plan. The plan selected must not only reward achievement, but must also motivate greater achievement, stay within overall corporate compensation policies, and be competitive with other potential employers in the market.
A key component of successfully retaining sales professionals is providing them with professional growth. Top salespeople want to broaden their knowledge and continue to learn. Continuing education programs allow investment sales people to feel good about themselves and the quality of service they provide to their clients.
The last area is recognition. It's human nature to want to be recognized for achievement. Titles, awards, and other nonmonetary approaches help motivate, reward, and retain key sales people.
Mr. Werlin is executive vice president, financial institutions division, of Robert Thomas Securities, St. Petersburg, Fla., a subsidiary of Raymond