How to Improve Sales Performance in Financial Services
Is it possible to improve sales performance in financial services businesses? Yes. Because of our COVID-19-related new normal, consumers will be looking for financial advice. Some investors will want to move their money into safer assets. Other investors will need credit counseling. To optimize their outcomes, financial services businesses will need to hire the best sales reps to help today’s perplexed consumers.
One way to improve sales performance is to cut down on sales rep churn. In our Voice of the Sales Manager survey, financial services sales managers reported a 35% annual turnover rate. This kind of turnover gets expensive, especially when you consider that it takes three months to hire a replacement and another seven months to fully train the new hire.
Understanding Performance Differences
Some of this financial pain could be eased understanding how and why your sales stars succeed. Because you want to clone them, if possible. According to a recent report by McKinsey, “[o]ne financial-services company was surprised to learn that top-quartile inside sales reps were three to four times more productive than the bottom quartile. To find out why, sales managers studied call flows, offers, and customer interactions. They learned that top performers were far more effective at communicating value and knowledge at each stage of the buying process.”
Unique Aspect of Financial Services Businesses
This huge difference in performance should be enough for any sales manager to want to use a more efficient hiring process. To bring in the best candidates, managers have to consider the industry’s unique aspects. Yes, reps must excel at communicating value and knowledge. In addition, according to the results of our Voice of the Sales Rep survey, 50% of reps in the financial services industry sell products and services that are highly regulated by government. Sales reps and agents must be licensed to sell these products and services. Any candidates who aren’t yet licensed must show a willingness to take courses and pass exams.
Sales Performance in Financial Services
That’s not all that sales managers should focus on when hiring. They should use a sales assessment test that measures factors like motivators aligned with the regulatory process. A sales manager may want to think twice before hiring a rep who has a tendency to get highly creative during the sales process that must be rigidly followed to ensure government rules are followed.
On the other hand, sales managers should remember that while a sales assessment test is just one part of the hiring process, using a comprehensive tool will yield best results. Our Voice of the Sales Manager survey outcomes show that while 62% of financial services sales managers use a sales skills assessment, only 24% employ a test that measures motivational aspects. Even fewer, 20%, test for critical thinking and empathy, but 59% say that critical thinking is a top quality.
A sales manager shouldn’t automatically disqualify a candidate who scores low in a sales assessment if the person possesses other key credentials. In these cases, you can also ask interview questions designed to determine how the candidate would respond in a specific situation. For example, if you ask them how they resolved closing a sale when they were running out of time, you might be able to tell if they were tempted to skip critical steps for getting necessary documents signed.
Employers often make the mistake of assuming that candidates should possess specific academic credentials, such as a 4‑year college degree, before they pass them to the next phase in the interview process. Yet, research has shown that employees hired using that screening metric often leave the organization quickly. In another study, sales managers who hired employees based on their extroverted nature later realized that what customers prized was fast and accurate service. Using a comprehensive sales assessment test gives hiring employers a profile of the complete candidate.
Beyond that, the assessment results can reveal which candidates can be coached into becoming top performers. In our Voice of the Sales Rep survey, 27% of reps in the financial services industry indicated their desire for more sales coaching. Interestingly, 24% of financial services rep say that the outlook for their organization would be brighter if their co-workers were more proficient. This attitude suggests that managers who spend time coaching their reps can improve the sales performance and the culture of their entire department.