A survey concludes that maximising sales capacity and adviser effectiveness through the adoption of efficiency techniques can boost productivity in Europe’s bank branches. Stephen Timewell reports.

While branch productivity is seen to be increasing across Europe, there is wide variation in actual performance, leading to considerable upside potential in profit enhancement for those banks able to reach best practice targets.

In a recent survey by Finalta and the European Financial Management & Marketing Association (EFMA), the branch is still the major source of retail product sales across Europe with an estimated 77% of retail products sold in Europe going through the branch network. But branch manager leadership and sales effectiveness can vary significantly, directly affecting performance.

In the survey covering 125 banks in 25 different European countries, the average number of products sold per week for mass market advisers is 10.4. However, in 40% of banks, adviser sales are less than seven and in 28% of banks, advisers sell 16 or more products a week.

Finalta believes that 16 or more sales are eminently possible for mass market advisers with no material telling or servicing responsibilities. It notes that high performance advisers in this sector can undertake 25 meetings a week, convert about 50% to sales and can cross-sell at a rate of 1.5 or more.

Mixed model inefficiencies

Low product sales are often found where mass market advisers are expected to combine sales and servicing roles. This happens in banks with small branches and low volumes of over-the-counter transactions making the dedicated teller role inefficient.

Remus Brett, director of Finalta, explains: “While there are clear benefits for some banks in the mixed role model, it is typically very difficult to manage effectively.”

Acknowledging complex staff issues, he adds: “Remuneration policies and variable pay still reflects the team-based, low-incentive model typical for teller staff, not sales people.”

In assessing the role of calls and contacts, the survey suggests wide variation in absolute levels of customer calling and the effectiveness of time spent on this activity. Some bank advisers make more than 20 phone contacts with customers a week, typically generating more than 12 meetings a week. Finalta believes that with effective research and calling techniques, best practice banks’ advisers can generate four or more meetings for every hour spent calling.

Speaking last month at the Branch Banking Summit held by The Banker and EFMA, Mr Brett highlighted a process called ‘working to the grid’, where if the target is to sell 14 products, the grid gives clear activity targets such as 22 meetings a week, 3.5 hours of lead generation aiming to book eight meetings. He noted: “Without any major process change, we helped one bank introduce this system and record a 25% increase in sales time. More importantly, sales volumes increased by over 20% and this benefit has been sustained six months on.”

Maximising sales capacity and adviser effectiveness is key to reaching best practice and systems such as ‘working to the grid’ enable performance management and measurement tools to improve effectiveness.

Productivity enablers

How much can banks boost productivity and the bottom line? Using data from a Top 20 European bank with 2000 branches, Mr Brett explained that using the four key enablers – line leadership, deep sales coaching, incentive systems and activity management – there is a potential to increase annual branch sales by more than a third, or 1.5 million products.

Weighting by average product margin, this moving from average to upper quartile performance translates into an estimated 26% increase in retail banking profits. Clearly a case where improvements in branch productivity can pay significant dividends.

PLEASE ENTER YOUR DETAILS TO WATCH THIS VIDEO

All fields are mandatory

The Banker is a service from the Financial Times. The Financial Times Ltd takes your privacy seriously.

Choose how you want us to contact you.

Invites and Offers from The Banker

Receive exclusive personalised event invitations, carefully curated offers and promotions from The Banker



For more information about how we use your data, please refer to our privacy and cookie policies.

Terms and conditions

Join our community

The Banker on Twitter