Your Best Training Investment

Last week, I discussed why quality first-line managers (FLMs) drive success in a sales organization. There is no question that FLMs have a significant impact — whether negative or positive — on a firm’s sales results. That is precisely why companies with limited training dollars should invest in developing FLMs before originators. Yes, I said FLMs should receive the training investment first because they recruit; determine how fast a new employee ramps up; establish a successful culture; and motivate the sales force to accept change and embrace current market conditions. All these issues are driven by a competent FLM.

When one originator’s skills and knowledge are enhanced through training and coaching, performance improves in a single territory. When one FLM’s skills and knowledge are improved, performance improves through an entire district or region. Companies can leverage investments in FLM development to produce considerable gains at a relatively small cost. Yet, too many companies decide to train originators before managers assuming that a one- or two-day training session at the annual sales meeting will boost sales performance. This approach rarely works because the sessions are not focused enough to address individual learning gaps and new sales behaviors are not reinforced after the training.

Why is investment needed in FLMs? Frankly, many FLMs are former originators who do not come to their position knowing how to manage. This is especially true when the manager is in name-only under a producing manager structure.

Without training and development, FLMs have to improvise and operate with a trial-and-error approach. This is not a smart strategy and a quick way to go out of business in an increasingly regulatory environment.

When companies say “our managers are experienced,” this doesn’t necessarily mean the managers are trained in what is demanded in today’s highly competitive financial marketplace. The real issue is: Have they ever been taught the management practices needed to be successful?

Case in point: Our research has shown that the best managers in mortgage banking are experts in five management practices: hiring smart; expectation setting; leadership; positive reinforcement and showing a sales success model or coaching (we call it the HELPS model). Assuming that the individual has the right competencies to be a manager, he or she can learn the five management practices.

In many classes where I have taught managers how to select originators, the usual response of the students — experienced managers — is that they have never received any training on hiring in their careers! Is it any wonder that the industry has high turnover when the person responsible for recruiting has never been taught how to hire correctly?

Finally, there are five signs that an FLM is in urgent need of a development solution:

&#8226 Consistently does not make numbers
&#8226 Has high variability in salesperson performance
&#8226 Previously strong performers are no longer doing well
&#8226 Consistently high turnover
&#8226 Hires many new originators who never make it out of the box and leave the company within their first year

The development of FLMs should be a sales organization’s top priority. The new era of mortgage origination requires it. FLM development is an investment that pays for itself quickly and ensures continued success for an organization by installing repeatable management processes.