Buying a new car is a painful experience for me. I am the type of person who shops for a new car on Sunday night when I know no salesman will be on the lot. I know that the salesman has one thing in mind: “Get that sucker in a car so I can get me a new gold tooth.” He will tell you just about anything to get you to sign on the bottom line, but you can bet he won’t remember your name ten minutes after the ink dries. When something goes wrong two weeks after buying the car, try and call the salesman. You’ll be quickly informed that you must now speak with the service department and that the salesman can’t help you.
Contrast car buying with the experience of buying fine men’s clothing. Unlike the car salesman whose objective is to move that single commodity (the car) off the lot, the clothing sales associate has a broader objective – to sell you more than a single item. You may come in to buy a suit but walk out with an entire new wardrobe. How does this happen? The sales associate listened to your needs and showed you a suit. But he knows that each suit must have a shirt, tie, belt, socks, shoes, cuff links and pocket handkerchiefs. Furthermore, if you need the shoes, then you probably need some shoe polish or maybe even a polishing kit.
The common thread between these two scenarios is that each salesperson is compensated for the sale, but it’s their approach to selling that is different. After purchasing a car, the likelihood of the customer returning in the future has more to do how their car performs than the salesperson. Whereas the haberdasher is selling a relationship built on trust and confidence and style – and in the process (if he is any good at what he does) develops a long-time loyal client.
During my weekly Cornerstone on-the-road adventures, I encounter many organizations that have drunk from the CRM fountain of promise. You know the stuff: customer centric, relationship driven, sales culture, etc. It’s only recently that I’ve noticed one area being critically overlooked or avoided in these initiatives, and I owe that realization to Mrs. B.
I met Mrs. B in a recent onsite CRM assessment interview. Mrs. B has been a teller in this bank for 30 years. She has gone through three core conversions, two branch platform replacements and enough changes that I put my pencil down, quit taking notes and just listened. I could tell Mrs. B loved her job and her company. She proudly displayed the thirty-year pin on her lapel, and even her wristwatch was company branded. Mrs. B clearly had passion for the bank’s customers and appeared to be willing to adapt to whatever change was necessary. Or so I thought.
I had barely started into my spiel about the company’s CRM strategy when Mrs. B politely but abruptly cut me off. She straightened her glasses, looked me dead in the eyes and said, “Why should I care about this stuff?” Red in the face, I quickly responded with the company strategic CRM objectives. She gave me the floor and pondered my response for a moment and once again asked, “Why should I care about this stuff?” It was now time to bring out the big gun statement that always gets them: “You will be able to see the entire relationship a customer has with your organization.” There, I thought, that should do it. Before I could take a sip of water, she very sweetly looked at me and said, “You clearly do not hear what I am saying. Why should I care about this stuff?” Well being a southern gentleman, I know when it is time to concede. I asked Mrs. B to elaborate. She repeated her question, “Why should I care about this stuff?” this time with emphasis on the “I”. It was clear the time had come for me to pay attention. This lady had something on her mind.
Mrs. B explained to me how she performed her job today — how she knows most of the customers by name, and even if she doesn’t, she is courteous and pretends to know them. At this point, I jumped at what I thought was her conclusion and informed her that a CRM system would on some level enable everyone to treat the customers with the same level of knowledge. Before I could extract both feet from my mouth, she cut to the chase and concluded, “I understand what it will do for the customer and I can see how it will assist the sales team, but what’s in it for me?” Translation: Show me the money! And there it was, folks. The most loyal and passionate employee of this bank revealed the critical flaw – the failure to consider a broad-based incentive program to promote CRM strategy.
Most compensation plans are designed like that of the car dealer. A single salesperson is rewarded for quantity, and the mantra is sell, sell, sell. However, a plan like this undercuts a customer-centric, relationship-oriented strategy. A relationship-driven compensation plan must find a way to motivate the sales and service personnel as well as the individuals required to fulfill and retain that relationship.
The following example is a window into the possibilities:
A customer walks into your bank branch to deposit a check. The teller enters the customer’s account number into the computer, and a message pops up onto screen informing the teller that the customer was mailed an offer for a special HELOC rate because she is an incredibly profitable customer who the bank loves dearly and would hate to lose. Naturally, the teller asks the customer if she received the mailer and whether she is interested in learning more about this offer. The customer answers yes to both questions. At this point, the teller has just closed the loop on the direct mail campaign and made a referral to the branch sales agent (BSA). Meanwhile, on the BSA’s desktop a message pops up stating that Sasha (Teller #4) has just referred a customer to her. The BSA greets the customer in the lobby and proceeds to fill out the necessary paperwork to close the HELOC sell. A month later the HELOC customer calls the call center with a question about her HELOC. While speaking to the call center rep, the customer comments on the inability to find a contact phone number on the bank’s Web site. The call center rep documents the comment in the tracking system and closes the call with the customer.
I must confess that this particular example includes some pretty slick technology and some well defined processes working for it. However, it is compensation and incentives that drove this example. A traditional compensation plan would have only awarded the BSA for the sale. In a relationship-driven world, everyone gets a piece of the pie.
Let’s start with the teller:
The BSA:
Call Center Rep:
Each employee has his/her own reward structure, which is directly linked and compensated in accordance with job function.
After you have redesigned your compensation plan, take the next step and automate it. It’s the employee’s pay, so let the employee track it via your intranet in real-time. Spreadsheets and homegrown systems (what many of us use today) won’t work, because more time is spent bickering about the numbers. In the process, employees are likely to become frustrated and lose faith in the plan. Remember, employee satisfaction is synonymous with customer satisfaction.
For everyone’s sake, keep the compensation plan simple. If you have to call your neighborhood CPA for translation, odds are it is too complicated. Oh, and don’t forget to update the plan as new products are offered.
Here is a little quiz to help you determine just how customer focused and relationship driven your current compensation plan is.
Mrs. B speaks for more of your employees than you realize. Who knows? Maybe this is the missing link in your CRM project. Could it be that simple? Hmmmm…
(Hey, at least for a few moments the IT group wasn’t being blamed. Gotta keep watching the back of my techno brothers and sistas.)
-tj