It may appear that the new opportunities for core banking solutions are dwindling rapidly as most of the banks have adopted and already completed their first wave of technology transformation. Almost no bank is without core IT system, centralization, internets, channels etc. There could be various degree of maturity but no successful bank today is devoid of basic IT solution for its customers.
Selling core banking was probably easier when the banks did not have these systems. There was hardly a debate that any growing bank needed a centralized, 24X7, scalable and configurable new-age solution to stay in business. It was not a matter of choice; there was urgency on part of the bank. The IT departments in the bank drove these initiatives – got the RPFs, invited the core banking vendors, went through a selection process and the deal was done once selected. The key success factor for the sale team was to be in synch-up with these bank and their requirements who are contemplating such transformation. But that was more than ten years back.
So what changes now? According to me the analogy could be – the difference between selling food to ‘hungry’ and those who are ‘well fed’. Both still need food and opportunity may be still the same but the sales effort and orientation for two situations would vary considerably.
Who to sell in bank – Are we still selling to ‘IT’?
With advancement of technology, the role of CIO and IT department in the bank has reduced in decisions making for banking solutions. Technology has been demystified to some extent and even the business can understand it better. Increasingly the business heads in the bank decide on the technology priority of what to buy, when, at which cost and ROI and a business case. So the value proposition of the IT solution has be to be directly linked to the business performance in more direct way. Does your solution increase my revenue by 10% or help me get 10,000 new customers? The sales lever has to change from efficiency and FTE reduction (cost drivers) to new business growth (revenue drivers).
This means that the sales team’s new touch point is business heads in the banks – connecting with business is more difficult as one need to understand their business and KPIs really well.
Whose job is it to sell – do we leave it to ‘sales’?
A structured sales team is best equipped to handle a centralized turnkey outsourcing deals. Such deals though very important – will decrease with time. In a highly matrix client organization or when it comes to mining existing clients – the professional sales pitch is least effective. Each person interacting with the bank in ongoing projects; whether from delivery, consulting, support or training is a sales agent. It is not uncommon therefore in many IT service organizations that everyone above a level of seniority having any direct interface with client have an explicit sales target.
Unlike the profession sales team, the employee driven sales priority and order is different – first sell yourself, then your team, then unit and then organization. It is self-balancing and would ensure the health of the organization.
How to sell – Are we waiting for the ‘RFPs’?
I go back to the examples of selling food to hungry. There will be no explicit ask for food if the person is not hungry. They may still need some nutrients and vitamins but it is something that they themselves may not know. Hence the shift would be required in sales approach to ‘first diagnose and then sell’. There may be fewer and fewer RFP coming up from banks by themselves.
There is an opportunity however to really partner with the existing clients - diagnose what they need, understand their problem areas, bottlenecks and create a demand in most symbiotic way.
When to sell – Are we waiting for the next big ‘release’?
CIOs and IT heads that have somehow survived through some of these banking transformation projects dread it not to repeat them again. The big transformation is scary for everyone. So the next big release that the product team is working on will not appeal them anymore. Agility is the need of the business – something they can do it 3 months and get explicit results? Do we have point solutions that can be easily deployed without being asked to change the whole engine?
The sales team will have lesser opportunities to sell big deals – which had a set template. The smaller deals need lot of context, knowledge and effort.
What are we selling –Is it the ‘solution’ that we have or the bank’s needs?
As long as the needs of the banks were similar a standard IT solution could be implemented most uniformly. As the business of each bank is eventually different their next wave of needs would be lot more differentiated. It would be highly contextual and require lot more problem solving than before. This may require out-of-box approach in proposing solutions that truly helps them achieve the business outcome. This would require strengthening the engagement function before the direct sales can kick-in.
To summarize - the opportunities for the core banking solutions may be as much as or even more. The sales process has to align with the line function in banks – i.e. the core business of the bank. Business in the bank surely will never be out of business.
