Banks and life insurers are the chalk and cheese of organizational culture.
If you judge by stereotypes, retail bank cultures revolve around processing transactions. They are driven by demand, and many bankers are uncomfortable with asking a customer for business.
Many life insurers, on the other hand, have a strong selling focus. They feed sales personnel on healthy doses of motivation, recognition and financial incentives, which are largely foreign to the bank environment.
In reality, both bank and life insurance cultures are changing independently, but the perception of conflict lingers.
How, then, does the bancassurer manage this cultural divide to find a single formula for success?
The first and most important step is to recognize that differences exist. In the early 1990s, Brian Brown, who did much to build up TSB Banks bancassurance operation in the U.K., was quoted as saying, “Never seek the middle ground. Recognize that different cultures exist. Do not allow the bank environment to dictate a culture for sales personnel.”
Banking personnel and sales personnel are different beasts. They need to be if the bancassurer is to succeed.
A banker might be a person happiest with figures, who is methodical, focused on detail, cautious, and comfortable in hierarchical reporting lines.
An insurance sales person is typically someone who dislikes control, deals in concepts instead of figures, is extroverted, and relishes risk-taking.
Bancassurance can only work effectively through building a culture of total cooperation between the banking and sales personnel. The sales consultants rely upon good leads from the branch. Each consultant, in return, must be a team player and build good relationships with the branch. If the bank were to receive a complaint from a customer about an insurance sales consultant, it could be disastrous for internal relationships. The consultant must accept, therefore, that the client is first and foremost a bank customer. He earns a living from that relationship.
You can drive this team behavior through several means. Our teams at GE Employers Reinsurance Corp. find success with a combination of simple tactical steps as well as leadership initiatives:
Daily meetings. Many bank branches have a daily meeting between the consultant and branch manager to discuss the day’s activity.
Clear responsibilities. It is vital to draw very clear responsibilities and reporting lines for each stage of the customer servicing relationship.
Training sessions. Regular training sessions by the insurance consultant in the branch help to educate and build team spirit. All branch personnel should be involved in activities such as briefings and sales and management meetings. The successful bancassurer will avoid the creation of a them-and-us attitude, which also means avoiding secrecy, jealousy and elitism. Thats no mean task.
Incentives. Getting the motivation right is vital, too. Some banks make the mistake of keeping sales bonuses too low for fear of upsetting their own personnel. This only causes good sales consultants to move to more appreciative bancassurers. The result is mediocrity.
Often, the solution is to review the entire remuneration structure to include performance incentives for other personnel. However, it needs to be recognized that it is virtually impossible to devise a scale for sales consultants which is the same as other bank personnel. If a bank employee becomes jealous or dissatisfied, the better solution is to invite him to apply for a sales position, provided that they have the right qualities, that can work out well. Whatever the result, it is vital to be totally open about the remuneration basis.
Clear vision. Mission, vision and value statements not only give the new insurance operation a belief in itself, but also ensure that there is only one vision for the bank and insurer. In developing these principles, it is important that they be clearly stated and allied as closely as possible to those of the bank. This may well entail the bank rethinking its own principles at the same time.
Leadership. Open communication is key and must be driven from the top. The CEO has to be seen to wholeheartedly support the bancassurance venture. Such commitment must permeate all levels of management. Without it, the venture will run into problems that may take years to repair. Mission, vision and values are worthless if they are not reinforced. They need to be continuously demonstrated by management practicing them as well as preaching them.
There is no single formula for success in bancassurance. But the common thread is that the leaders of successful bancassurance ventures set a clear vision, practice what they preach and provide support to the front lines, where retail bankers and the insurance sales consultant work to meet the needs of the customer.
Peter Elliot is head of sales (U.K.) for GE Frankona Re, a part of GE ERC Global Life and Health.
Reproduced from National Underwriter Life & Health/Financial Services Edition, July 27, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.