Referral Management – Leveraging Technology, Incentives, and Culture to Improve Performance

A Component of Linked Execution – A Business Integration Solution

Linked Execution is a methodology that helps businesses clearly evaluate and improve the way a company presents its entire portfolio of products & services more effectively to their customers/clients across all channels of interaction. The model has five main components that can be implemented as a group or independently of one another. We’ll be examining each of the five components here on FinSights during the next few months.

A previous post on sales force enablement, one component of the Linked Execution model, discussed how businesses can take a top-down approach to business integration, finding solutions to bring the entire enterprise to bear. But we shouldn’t stop there. Referral management is another key driver of collaboration and integration across a business’ product mix, but rarely is the process fully optimized. The creation (and usage) of a strong referral management system can create more business opportunities across the company.

Referral management isn’t as simple as sharing contacts or relationships – although that’s certainly part of it. Rather, it’s the focus on an individual customer – striving to serve a customer’s entire financial presence with the right suite of solutions to accommodate their needs.

Before implementing a referral management strategy, the corporate vision for change must include top-down reinforcements. Leadership should be fully bought-in in order to emphasize both importance to the business and value to the customer.

With the backing from upper-level leadership, a successful referral management system should incorporate the following three key components:

Referral management graphic

  1. Cultural Shift – In this cultural transformation trust is paramount to a successful program. No matter how well aligned other components are, if sales teams don’t feel confident in passing along valuable customer information and relationships, referral volumes will be low. A well-developed organizational change strategy can help ease the transition.
  2. Technology Enablement – An organization’s technology team plays an integral role in preparing for referral management. A strong CRM that facilitates sharing across lines of business (LOBs) and detailed tracking to include volume, pull-thru rate, and quality referral components, will help keep teams clued in to a customer’s relationship.
  3. Incentives Structure – Finally, the incentive structure (revenue and fee sharing, etc.) must make it beneficial for both the sending and receiving team members to share contacts / relationships.

With a strong referral management program, collaboration and integration forge business partnerships across LOBs. When done correctly, this leads to a higher number of products per relationship, reduced cost to serve, and at the end of the day, increased performance.

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