The important role of business development managers

The role of business development managers is one that is frequently discussed in the financial services industry. Col Fullagar takes a look at what financial advisers want and expect from this sector of the industry. 

Business development managers, or BDMs as they are often called, are also known by various other titles, including sales managers or practice development managers. However, irrespective of what they are called, possibly no other group within the financial services industry attracts a wider range of opinions.

Some advisers believe BDMs provide an important support function in their business while the less kind simply refer to them as ‘brochure delivery managers’.

Bearing in mind the larger insurers may employ up to 30 people nationally in the BDM or equivalent role, and they can command significant base remuneration packages, plus bonuses, the role warrants some attention.

In response to two survey questions, a number of advisers were asked to express their attitude to BDMs and whether or not BDMs added value to the adviser’s business.

The first question asked was: Do BDMs add value to your business?

The results were interesting and, in some areas, surprising. In summary, 30 per cent of advisers responded to the first question in the affirmative: yes, BDMs do add value. However, 70 per cent were ambivalent or responded in the negative.

Going further, however, generally speaking the adviser concept of adding value was that they would simply like the BDM to be available when needed and invisible when not needed. Comments included:

• ‘Being there when we need them and keeping a polite distance when we do not.’
• ‘I do not want them to pester me. I need them to react when I need them.’

Not helping their cause is a tendency for some BDMs to ‘frisbee’ from one insurer to another, expecting the adviser to switch insurer loyalty as a result. This attitude generated adviser comments such as:

• ‘They seem to change with great regularity and when they appear they ask ridiculous questions.’
• ‘They should not act like industry hussies, one month with one company flying the flag and then the next month they are doing and saying the same thing with another company.’

Balancing this, however, are a great number of BDMs who display not only technical and product prowess but also corporate loyalty in the face of tempting offers from competitor insurers. Advisers can better rely on stable resources and are more likely to respect and work with BDMs who understand this and act accordingly.

The second question asked in the adviser survey was what things BDMs could do that would add value to the adviser’s business?

The responses fell within a number of areas:

Underwriting

• provide assistance with acceptance terms for more complex occupations (eg, police, firemen, farmers, miners, etc);
• assist with obtaining or correcting quotes; and
• assist with the completion of applications held in suspense.

Training

• provide one-on-one or group product training; and
• provide or refer to others who can provide technical training.

Company matters

• keep advisers up-to-date with relevant changes within the insurer’s business;
• assist with the resolution of disputes either directly or by providing escalation processes — particularly taking ownership to ensure a problem is resolved;
• overcome log-jams in the insurer’s new business, administration or claims areas;
• assist the adviser to understand the insurer’s commission system and supporting documentation;
• if necessary, assist in the reconciliation of commission payments and subsequent commission adjustments; and
• provide legacy product analysis material.

Advocacy

• communicate with the insurer’s staff so staff better understand the adviser’s position; and
• provide an impartial and balanced sounding board.

Industry matters

• keep advisers up-to-date with changes within the industry and, where appropriate, changes within other licensees.

Product

• explain their insurer’s product features and how these may assist clients;
• assist with the development of product stories;
• arrange product workshops with other advisers; and
• assist with induction of newer advisers.

Marketing

• provide access to quality marketing material;
• pass on referrals;
• transfer orphan clients;
• assist in the planning and running of seminars;
• present at adviser client seminars; and
• identify legacy policies that could and should be upgraded.

Financial advice process

• develop ideas around how the advice and sales process can be improved using, where appropriate, ideas gleaned from other advisers; and
• assist paraplanners to better understand quotation software, forms, and so on.

Finally, some general adviser comments in response to the survey:

Financial advice comments

• ‘I do not want a product flog.’
• ‘Understand our business and do not ring up with the latest and greatest when we do not care.’
• ‘Greater use of emails than visits.’
• ‘Doing what they commit to do.’
• ‘I do not like it when they turn up, pretend to be interested in who I am and then I never see them again.’
• ‘They should remember country advisers.’
• ‘How about support for staff as well as the advisers.’
• ‘Not all advisers are the same. BDMs should be flexible in their approach.’
• ‘We support those BDMs who keep regular contact and ring to say thank you for our business.’
• ‘I would have liked to respond to your survey but I have never seen my BDM, but then again, I am not sure I want that to change.’

Summary

It was not the intention of the adviser survey nor is it the intention of this article to criticise at BDMs.

On the contrary, the intent is in part to provide a platform for open discussion and debate that will hopefully lead to better use being made of and greater respect being generated for the BDM role.

BDMs are a significant resource available to advisers and those who work within the adviser’s business.

To simply ignore or misuse this resource does not make commercial sense.

The challenge for some advisers is to take better advantage of this resource, but to do so will require a clear and open line of communication between these advisers and the BDM.

The challenge for BDMs is to be sufficiently good at what they do such that they can be seen as adding value to a business in much the same way as the business’ employees or even the business’ principals.

When considering the concept of true value in regards to the employees of a business or the business principals, various rating criteria could be used:

• is the person’s opinion sought and given serious consideration?;
• is the person being treated as an ‘equal’ or better?; and
• is the person respected for the role they perform and their contribution to the business.

BDMs are a critically important part of the financial services industry and as such it is important that the various parties within this industry — advisers, insurers, licensees and, of course, the BDMs — work together to ensure the value added by BDMs is recognised and optimised.

Col Fullagar is national manager at RI Advice.