The hunt for new business – does it ever stop? Does it ever take a back seat? No. We’re in hot pursuit of every possible dollar to impact our bottom line, and one of the greatest untapped or under-tapped opportunities to do this is through Centers of Influence (COIs). Centers of Influence refer to sources of new business leads from outside the bank; accounting firms, law firms, chambers of commerce, and in some cases include internal sources, like other lines of business.
Centers of Influence have always been around. They play a critical role in the new business channel ecosystem. But, they’ve played more of an ‘extra’ or ‘behind the scenes’ role, as opposed to ‘main character lead’ taking center stage. That said, more limelight needs to be directed here. Gartner research reveals that in the world of wealth management, only 15% of new clients, on average, are sourced from Centers of Influence. This is, without a doubt, an unexploited opportunity for growth.
Recent conversations with Financial Services leaders not only point to renewed energy towards reviewing firm strategy towards COI partnerships, but also towards three fundamental shifts that need to be considered to win in this space.
Less Banker Dependent, More Management Driven
The first shift is more familiar and closer to home. Conventional approach to Center of Influence management is typically one that falls onto the shoulders of frontline bankers. In pre-pandemic years, Financial Services leaders were trying their best to remove manual burden away from bankers and create more capacity. But with the arrival of the COVID-19 pandemic and 40% of employees across industries in the US reporting feeling burned out as a result, removing manual burden away from bankers is no longer a ‘nice-to-do’ but a ‘need-to-do’.
Heads of Sales and Strategy must:
- Step in and do more to help; take on more ownership in this process
- Plan and facilitate more virtual events in collaboration with COIs, to foster opportunities at scale
Identify Common Purpose and Become a Cog in The Wheel
Financial Services leaders should not only use Centers of Influence to access new customers, but also as a means to better meet customer needs.
“Together with for example an agricultural entity, we design an attractive funding solution for their customer base, and through that, we get access to primary and secondary customers who are not currently banking with us” – Executive Head: Business Banking Sales, EMEA
“We’re looking at places where we can come together to meet a specific business need and where we might even proactively bring partners with us to solve for that need. In the US, there is a huge transition for middle market companies, as a result of aging populations, that need to transition their companies onto their children or other entities. Rather than just being a bank that fulfils one or two components of that image, we’re looking at how we can play more of a sustainable role as a ‘cog in the wheel’ together with our partners” – Sales Enablement Leader, Commercial Banking, North America
Expand The Center of Influence Ecosystem
The COVID-19 pandemic challenged us all to be brave and bold and Financial Services leaders must dare to look beyond traditional Center of Influence players, and look towards the unconventional.
“We are partnering with fintechs, as Centers of Influence. These partnerships are giving us access to new types of clients, younger clients for example, that we otherwise wouldn’t have been able to reach” – Head of Retail Banking Strategy, South America
To summarize, when reviewing your firm’s approach to Center of Influence partnerships to drive new business, consider these three imperatives:
- Enable management to play a bigger role in Centers of Influence engagement; step in and identify opportunities to collaborate with COIs for mutual gain
- Create a common purpose together with other players in the Center of Influence ecosystem; draw up the kind of expanded role you want your firm to play in the customer’s journey and how COIs around you support that role
- Expand beyond conventional Centers of Influence