Asking an existing customer for a referral is among most RMs’ least favorite activities. They fear the possibility of being rejected, and at a more basic level, many say they do not know when or even who they should ask.

Drawing on insights from a survey of small business owners, we identified five key markers of customers already willing to recommend your bank to others. RMs who focus their referral efforts on these likely customer advocates can generate a greater number of higher quality referrals than RMs who have a less targeted approach.

Board members, see what makes a customer recommend you to others, and understand how you can make your RMs more effective in asking for – and obtaining – customer referrals.

RMs have always been pressed for time, and today’s focus on credit quality and the heavy burden of new regulations further reduce RMs’ capacity to call on prospects. Faced with ambitious growth goals and fierce competition for customers, leading banks know that they must preserve RMs’ ability to prospect, and that they must cultivate and sustain a focus on new sales and acquisition. Oxley Bank (a pseudonym) faced a similar challenge a few years ago, when tasked with a very aggressive growth mandate, found that only 10% of their RMs met their individual calling targets. Read More »

The Business Banking Board’s latest research on Relationship Manager (RM) Productivity and Engagement finds that the majority of small business and middle market RMs are not confident they can meet their production goals.  To add to this, only about half of surveyed RMs agree with their banks’ stated objectives and strategy.

The lack of RM confidence and engagement threatens business banks’ ability to meet their aggressive growth goals. Business bank executives risk derailing their growth investments unless they better understand and support their RMs. Read More »

Sixty-two percent of member executives declare targeting high potential customer segments as a major focus this year.  As you know, in response, the BBB is investigating how leaders  can better serve and sell to businesses that sit on the threshold between the conventional Small Business and Middle Market divisions.  At the heart of our research sits a fundamental question. Are these businesses – with unique needs, different decision making structures, and different appetite for bank products – the culprit behind bank challenges? Or are the challenges banks experiencing with the in-between businesses the symptom of a fundamental shortcoming in business banks’ current model?  Read More »

Business banks are missing opportunities with a key customer segment: the businesses that sit right on the threshold between the Small Business and Middle Market lines of business. These businesses have outgrown the support and credit processes of the small business division, but they are too small to warrant the full suite of middle market products and services.  Neither division serves them well, nor has either division made these businesses a primary, strategic focus. They constitute what we on the research team have termed “the messy middle.” Read More »

As my colleague Sara Osborne noted last week, one key finding from our 2010 survey of Relationship Managers is that small business RMs find support systems and processes much more helpful than their middle market peers.  Specifically, these support systems and processes include adherence to a standardized sales process, sales tools, and manager coaching.  In combination, these elements have a strong, positive effect on a small business RM’s chances of hitting or exceeding goals, but reduce chances for a middle market RM. Read More »

The world of the Relationship Manager has seen some big changes the past couple of years. The decline of formerly healthy customers, a focus on cash and fees rather than loans, and upended credit standards…to name only a few. All of these suggest that the old rules of what drives performance no longer apply. To understand the world of today’s Relationship Manager, the Board undertook a multinational survey of RMs on how they spend their time, their behaviors and attitudes, the types of customers they serve, and the level and type of support they receive from their bank. The purpose was to uncover the state of the new Relationship Manager and what levers banks have to drive RM performance.

We are still sifting our way through the results and are excited to have more to report over the next couple of months. But for now, here are a couple of findings that have struck us so far: Read More »

The “trusted advisor” RM was supposed to be business banks’ key to more cross-sales, faster sales cycles, and greater customer loyalty. So bank executives and RMs have aspired to move beyond basic service and reactive sales to the more complex advisory role.  But recent findings from the Board’s 2010 survey of business owners casts doubt on the value of the trusted advisor and challenge banks’ conventional goal. Read More »

Regular BBB Edge readers will recall a post from Sharon Chinn where we outlined 6 different roles RMs may take when interacting with customers.  These roles ranged from the reactive Server to the Advisor to the Bank Defender. In our recent multinational survey, when we asked 1,400 business owners to characterize the roles their RMs played, we knew the occurrence of Advisors and Solvers would be quite low, but we were surprised by some of what we found: Read More »

The end of the recession does not mean the end of difficult decisions or hard work for commercial banks. In fact much of the hard work lies ahead. 

 That’s the key takeaway from a recent BBB meeting of senior European banking executives.  Until recently, commercial banks embraced a “be-all-things-to-all-customers” and a “grow-at-all-costs” strategy. It was both cause and symptom of a relationship approach to banking, where an aggressive focus on profitability and risk took a back seat to a cozy and comfortable relationship with customers.  That approach simply cannot succeed in today’s low-margin, low-demand environment.  Read More »