egyii blog

There is a lot of talk today in:

Government (Obama has been promising it in recent speeches and I have just counted 33 times that The White House Blog has written on it in different postings in 3 days!)

Business (“…transparency in Pharma’s relationships with physicians is here to stay…” from MSNBC)

Banking (Geitner “..the necessary response is to try to bring more confidence, more transparency to the strength of the system…” from NPR)

…about transparency. But what is transparency?

Merriam Webster’s dictionary describes it as:

2 a: free from pretense or deceit : frank b: easily detected or seen through : obvious c: readily understood d: characterized by visibility or accessibility of information especially concerning business practices.

Transparency is clearly one of the most talked about solutions as a way out of our current crisis, as highlighted in Trusted Matters.

Transparency in Banking

How does all of this relate specifically to banking and resolving the banks woes and challenges?

After the Great Depression and the initial “big financial collapse,” the government bodies worldwide have required high levels of requirements around transparency in the banking system- to a point where both the governments, the bank employees and the general public are confused.

There is probably too much information – which makes it absurdly difficult to digest and understand.

Problem: If the governments and the bank employees are confused, aren’t the clients confused? How does this translate into concerns around relationship management with clients?

Most banking clients have lost trust and are trying to re-build the relationships with their clients. Re-building trust is not going to be easy, but by focusing on your Relationship Managers’behavioural skills it can be done. On top of that, instilling a level of personal transparency (maybe we call it “truth”?) will always be a big bonus.

Simply put, all clients (as they sift through the paperwork and legalise) want to know is “How safe is my money?” Can anyone answer that?

Trip Allen, Team Egyii, Singapore

I am not sure how private and priority banks are addressing the investors’ search for alternatives, but when the press and the government are lashing out harshly against the institutions, and clients want to run from the banking institutions, what are they doing and where are they going?

Certainly this is not a secret but there are options and alternatives available – and clients are presenting very creative solutions.

We have spoken with many ’fat wallet” investors (ones with over $1 million to invest) and there are typically 2 responses we hear from them:

1) “I don’t want my brokers making any investment decisions. I want a purely transactional relationship. I am knowledgeable enough to make my own decision.”

2)  “Investing is all too complicated. I want someone who I can trust to make the right decisions.”

If clients don’t want “value added services” (item 1) and are shying away from people they don’t trust (item 2), where are they going? Here are some alternatives they are taking:

1) Online and discount brokerages. Low fees and some value add. If you feel you are as knowledgeable, the lure is to pay $12.99 per transaction. Online Brokerage’s Success

2) Pre-negotiated, set fees with banking institutions

3) Third party advisers (who are typically ex-bankers) such as AL Wealth in Singapore, who act as “middle men” between the investment institutions and the investors. These third party advisers charge an annual percentage and build their relationship by being neutral.

(One priority baking client has mentioned to me that he requested his relationship manager to put his commissions on the line. If he promises a ‘guaranteed” return, then his commissions will be paid and will be scalable. If the investment is in the red, then he loses his commissions and fees. For some strange reason, the relationship manager did not win this clients business.)

How to avoid this? Build the right skills and trust for your relationship managers with your Singapore and Asia Pacific banking clients, so that they don’t have to consider alternatives. For more information see Trust in Sales.

Trip Allen, Team Egyii, Singapore

www.egyii.com

That is a mouthful. And it should be.

In one of Obama’s recent public announcement, he proclaimed the following:

“…in order to restore our financial system, we’ve got to restore trust.”

Obama and his team get it. Does everyone else? Probably. What is everyone else doing about it? Thinking about it? Yes. Taking action? Maybe.

There are a lot discussions on trust going around in multiple circles today and most of it is focusing on the financial institutions. Why is that? Are people fed up with the “old world” of the banking business?

Wouldn’t it make sense to make trust an integral part of the bank agenda? Certainly life and business would be easier for the relationship managers and the executives. And isn’t this what most clients want? A trusted relationship?

For more reads on trust in all the circles, read Trust, Trust, Trust by Charlie Green of Trusted Advisors. He and his team thoroughly cover trust from all perspectives.

Please also see James’ prior post Private Banks’ new journey back to credibility

Trip Allen, Team Egyii, Singapore

Private Bankers could do worse than taking a look at the hospitality industry for ideas about how to woo their clients back. Whereas bankers are experts at financial products and the business side of their work, they are less confident about the softer, human relations side. In contrast, hotel people are strong at meeting and greeting, while they are less confident about the business consequences of their actions. To succeed in any service business (or any business for that matter), we need a balance between people intelligence and business acumen.

Hoteliers can teach Private Bankers a lot about clients’ expectations and behaviour. They can also teach them how to create a memorable experience for their ‘guests’ so that they leave the bank feeling delighted. How many Relationship Managers in Private Banks prepare for their client meetings by saying to themselves, “I’m going to make sure my client has an experience he’ll never forget”?

Hotel staff are trained to be client-focused rather than product-focused. This means that they see every guest as a unique individual with special expectations and needs, whether in the type and location of the room or in the kind of help they need from the hotel staff. Each hotel employee learns the idiosynchrosies of their regular guests, and makes sure they find out the special requirements of one-off guests within minutes of greeting them. I fear that many bankers tend to lump their clients together in broad groupings in their minds, without understanding the need to understand the special individuality of each client.

It is amazing how a change in perception can create a change in behaviour. If bankers were to delete the image of ‘Private Banker’ from their self image and insert ‘Guest Relations Manager’, then their minds would produce a whole new set of ideas and priorities about client relationships. This simple step would enable them to move away from an obsession with explaining the benefits of financial products and instead focus on the special human connection needs of each client. Once this new approach leads to trust, then and only then will they find that they have a listening ear for their products.

Try it.

(Post edit: this concept applies to the overall service industry, including the restaurant business as Sharlyn Lauby states in her blog posting A Shout Out from hr bartender)

James Irvine, Team Egyii, Singapore

The Singapore Government, through the Monetary Authority of Singapore (MAS) has made a bold move into the world of Islamic Banking to step ahead of their “competitors.” Congratulations to MAS for putting egg on the faces of the Hong Kong business community (and the Malaysian banking community who has traditionally held this post in the region), as per the following posting in the HK Standard Charting a Safer Route…

The government has also instituted numerous learning and development programs in the banking community through a few of the local learning institutions to bring up the standards in the banking and finance personnel. I have heard from numerous sources that a lot of money and time has been put into this with little results.

Singapore’s business community relies heavily on the government to make decisions to protect the businesses and ultimately the working people. I am not knocking this and believe it has contributed to the success of Singapore. I am pretty sure  that the government and the business community are aware that this time around, things are different and that decisions from the top may not encompass all the answers.

Do they know the difference between the “old world” of business and the “new world” of business? Probably not as reflected in their actions. What about personal development, motivation and effectiveness skills in Singapore? These areas have been overlooked and need serious considerations.

We believe the solutions lie in the people. Your people upfront  make the difference- and that difference will move the business community ahead to an area of true cometitiveness.

For more see yesterday’s posting How to Repolish the Banking Image…

Trip Allen, Team Egyii, Singapore

Your front line, your client facing managers and relationship managers, are the best representation of your image.

You can spend millions of dollars on expensive, un- targeted, wasted advertising to “polish” your image but without your feet on the street knocking on the doors, you are wasting your time.

Your ties and coats and fancy office image can help, but it is not going to bring in the results.

If you are suffering with pain from a tarnished image, wipe off your poker face and belly up to the truth - go face to face with the client. Get your team motivated and confident so that you can stare at your client straight in the eye and re-establish that relationship.

Our research has shown us that banking clients have two main issues. One is portfolio performance (or wealth preservation in today’s interest) and the other is a trusting relationship with the institution and the relationship manager.

Blaming someone or looking for a solution from somebody will probably not work. As Thomas Friedman says “there is no pill  – not for this mess.”

Just get out there and do it. As the old Smith Barney ad said “earn money the old fashioned way.”

Kudos to Thomas Friedman in his always results oriented opinion editorials. Elvis Has Left the Mountain

Trip Allen, Team Egyii, Singapore