For Immediate Release
Contact: Andrew Cloutier
Anova Consulting Group, LLC
(617) 731-1045
andrew@anovaconsulting.com
BROOKLINE, MASS., April 24, 2012 – Anova Consulting Group, a leading provider of customized market research, sales training and consulting services to defined contribution, investment management and human capital management companies, announced today a new participant-focused program for retirement providers and plan sponsors.
The Participant Perspective Satisfaction Tool enables individual plan sponsors to survey their participants (and non-participants) and interpret satisfaction levels on an absolute and relative basis. By gathering constructive feedback from employees, sponsors will be able to better understand their participants’ needs, increase plan participation, and gain insights as to how their participant satisfaction levels compare to those of similar firms.
“For years, recordkeepers have conducted participant satisfaction research, but plan sponsors typically have limited access to their own participant satisfaction information.” said Richard Schroder, president of Anova Consulting Group. “Now, Anova has created a web application that allows plan sponsors to collect participant satisfaction information through an independent third party in a simple, “plug and play” process that generates an online survey for distribution to participants.”
A personalized online dashboard displaying real-time results is created for each participating plan sponsor. Sponsored by retirement providers as a client loyalty program, plan sponsors will gain access to Anova Consulting Group’s participant research capabilities at no cost to them.
Key benefits to participating plan sponsors include the ability to identify strengths, weaknesses and gaps within the sponsor’s employee benefit programs, as well as the ability to benchmark participant satisfaction ratings against other Perspective users and segment results by participant demographic information.
Schroder added that “Anova is currently in discussions with a number of recordkeepers and DCIO players who are considering offering the Perspective program to key plan sponsor clients and retirement plan advisors.”
Established in 2005, Anova Consulting Group is a leading market research and consulting firm focused on Win / Loss analysis and client satisfaction analysis. By helping its clients understand why they win, lose and retain business, Anova provides strategic perspectives to its clients, driving better decision-making, product development, sales effectiveness, client service, and continuous improvement. Last year, Richard Schroder, president of Anova, released a Win Loss Analysis book titled, From a Good Sales Call to a Great Sales Call (McGraw-Hill, 2011), which details how learning from post-sale Win / Loss debriefing helps close more sales.
Posted by Ellen Naylor on March 31, 2011 at 9:14am in Sales and Marketing Intelligence
Back to Sales and Marketing Intelligence Discussions
From a Good Sales Call to a Great Sales Call focuses on improving Sales’ post-decision debrief process with prospects, referred to as Win / Loss analysis in the competitive intelligence world. I like how the author, Richard Schroder, adds ‘post-decision debrief’ as the 7th element of the sales process. He insists Sales asks customers for their permission to conduct a post-sales interview during the presentation of your company’s solution rather than waiting until after the buying decision. A professional way to approach your prospect is: “We promote continuous improvement, and whether we win your business or lose it to a competitor, we value your feedback.”
Apparently only 18% of US companies have a formal Win / Loss program. Thus, in most new business situations, sales people don’t have a complete and accurate understanding of why they won or lost sales. If armed with such data, Sales can make behavioral changes to improve close rates by 15%.
According to Anova Consulting Group’s research, the sales process is often a top driver of the purchase decision, whether the business is won or lost.
Key reasons for losses from the sales process include:
**Lack of a customized presentation
**The salesperson doesn’t accurately uncover and understand the prospect’s unique needs, including decision making criteria
**The salesperson and / or team does not thoroughly prepare for prospect meetings and the presentation
Richard believes that sales people should not conduct these interviews since they often take the loss too personally and might try to re-sell the customer on their solution, be aggressive, defensive or dejected, which causes the customer to clam up or just to tell part of the story, the part that does not involve Sales. Prospects can also be uncomfortable talking with the salesperson whose solution they just rejected.
Yet, Richard gives great suggestions to help Sales conduct interviews:
**Do not attempt to gather feedback during the same call when you learn the sales outcome.
**Schedule a phone call or in-person visit with the decision-maker a couple of weeks after the sales decision.
**Take time to prepare the questions you want answered and seek input from your sales organization.
**This debrief questionnaire should include questions around the customer’s decision-making criteria; qualitative questions around your firm’s strengths and weaknesses; benchmarking against competitors; and the sales process (more detail to develop a Win / Loss questionnaire).
**This preparation will get you grounded, and will help you neutralize your emotions around the win or loss and let you focus on how and what you can learn.
**At the end of the interview, ask your customer if you missed anything. In my experience, this is when the floodgates open.
The book is chock full of ways to sell better:
**Build rapport. Learn as much about your prospect(s) as you can through the Internet, LinkedIn, Google, Twitter and industry associations.
**Don’t just plan your presentation: prepare the initial discussion you will have with each prospect. Ask some open ended questions to engage them.
**Develop a second approach to build rapport in case the first approach does not work.
**When in doubt, de-sell. For example, “Perhaps my service does not quite fit your needs.”
**Be consultative: if your product or service is not what the customer is looking for, refer them to someone who can help them.
**Remember people want to buy from experts, not salespeople. Research Research Research!
Appendix B tells Sales Managers how to implement a Win / Loss program. It is practical and well thought-out. Two factors stand out from my experience with developing such programs.
1. Does the program have executive level sponsorship and comprehensive buy-in from critical areas of your company?
2. Will the program be well integrated with existing processes already developed at your company?
I have learned the hard way that buy-in is essential at all levels. Some programs never get off the ground due to this lack of communication, leadership and integration.
My only criticism is Richard’s strong bias towards using a third party to conduct the Win / Loss analysis. I agree a third party brings less bias to this process, and can offer customers anonymity when reporting back to your company. However, I experienced good results conducting analysis for my company prior to consulting. There are some advantages that internal sources have: they know your companys products and services better than any third party since this is their full time job. Thus they can probe more deeply in these areas than can a consultant. They also know your company’s culture. Sometimes consulting firms recommend change that won’t work with your companys culture, even though it’s a great idea.
I recommend this book for those in marketing and sales who want to implement a Win / Loss program. I particularly recommend this book for salespeople who want to be BETTER. It clearly defines the value proposition for conducting analysis, especially for Sales. Do not be left out!
Recognized thought leader in Win / Loss analysis and sales training, and President of Anova Consulting Group, a leading market research, sales training and consulting firm, Richard M. Schroder, was kind enough to take the time to answer a few questions about his opportunity creating and game changing book From a Good Sales Call to a Great Sales Call: Close More by Doing What You Do Best.
Richard M. Schroder describes how to develop and utilize an effective debriefing process to provide detailed analysis about why sales were really closed or lost.
Thanks to Richard M. Schroder for his time, and for his very comprehensive and thoughtful responses to the questions. They are greatly appreciated.
What was the background to writing this book From a Good Sales Call to a Great Sales Call: Close More by Doing What You Do Best?
Richard M. Schroder: My company has been performing institutional Win Loss Analysis programs for large companies for over 13 years. Typically we are hired by a head of sales to conduct independent in-depth phone interviews with prospects after buying decisions have been made on behalf of an entire sales team. However, only 18 percent of companies currently have a formal Win Loss program in place for their sales teams, with an independent third party conducting in-depth interviews with prospects. This means there are over 20 million salespeople who have no access to an independent post-decision review on their behalf.
This book was written to fill that gap and bring our institutional coaching, expertise and knowledge to the everyday salesperson or small business owner. It shows individual salespeople how to better conduct post-decision debriefs on their own so they can improve their sales effectiveness and win more business.
What is the difference between a good sales call and a great one?
Richard M. Schroder: Our Win / Loss analysis research shows that there are five key themes that prospects typically express when speaking about a winning sales effort vs. a loss:
1) Consultative: The salesperson did research, asked the right questions, listened and then was consultative in their pitch and focused on the prospects’ unique needs.
2) Differentiation: The salesperson was distinctive / stood out in some way by clearly articulating how they were different from the competition.
3) Treated the prospect as important: The salesperson showed enthusiasm and made it clear that they wanted the business.
4) Rapport: The salesperson worked to build chemistry with the prospect and found common ground in a personal way.
5) Cohesiveness (in team selling situations): The most important word a prospect can say about a sales team is that they were cohesive (as opposed to coming across as disjointed or unprepared).
Why do so many salespeople lose the sale that seemed so near to it being closed?
Richard M. Schroder: One of the biggest things we have learned in all our research is that the main reason salespeople lose is because they are not actually selling to the decision maker. If a salesperson loses a deal and they never met with the actual decision maker then that alone is the reason they lost.
Most salespeople just look at a lost sale as gone, and then move on to the next prospect. Why do you consider this the wrong approach?
Richard M. Schroder: I’ve always believed that you learn more from your failures than from your successes. The best way to improve your sales effectiveness is to learn why you win and lose, so that you can reinforce your successful behaviors and rectify the selling deficiencies that are holding you back. It is only after you obtain accurate and candid feedback on your sales performance that you can institute meaningful change. By implementing a process for conducting better debrief calls, you will unlock a vast source of prospect information that will allow for continuous sales improvement and ultimately increase your close rate for years to come.
You share seven steps for a successful post-decision debrief process. What are those seven steps?
Richard M. Schroder: There is a lot to be learned from losing a deal, yet most salespeople do not know how to gather accurate and meaningful information from prospects to learn from their losses. Salespeople often ask prospects why they lost a deal, but they typically don’t get a straight answer. In fact, according to proprietary sales research data, prospects tell salespeople the complete truth about why they lost less than half the time. In fact, research has shown that salespeople learn the complete and accurate truth about 40% of the time. In other words, in 60% of new business situations, salespeople do not have a complete and accurate understanding of why they lost. This situation begs the question: If salespeople don’t understand why they lose, how are they expected to improve their performance and ultimately win more business?
Below are seven ways for salespeople to improve their post-sales etiquette and get more candid feedback from prospects post-decision:
1) Give early notification that you will conduct a debrief (regardless of the outcome of the sale): In order to make the prospect comfortable and illicit honest and, more importantly, actionable feedback, you should let the prospect know early in the sales process that regardless of the outcome, you will be conducting a post-decision debrief call at the end of the process.
2) Schedule a separate debrief call: Do not debrief on the same call as when you hear about a loss. When you hear about a loss, prospects have one goal in mind: to get you off the phone as quickly as possible. Therefore, getting good feedback is always challenging. Instead, schedule a separate debrief call after you have accepted the loss and let the prospect know that you will not try to change their decision.
3) Use a Win / Loss debrief guide: Using a questionnaire maximizes feedback and keeps the conversation focused. As a result, research has shown that salespeople who use a debrief questionnaire have a 15% higher close rate than those who do not. Sample debrief guides can be downloaded at Anova Consulting Debrief Guide.
4) Take responsibility: Make sure that you really want candid feedback; prospects will be able to tell if you don’t. Don’t get defensive or angry, don’t debate with the prospect and don’t try to resell the prospect.
5) Take notes: Tell the prospect that you’ll be taking notes. This will make them feel important and make them feel compelled to talk more. Your average debrief should last about 10-15 minutes.
6) Probe for specifics: Ask “How do you mean?” or “Say more.” Other great ways of getting candid feedback include asking, “How can I improve on this”, “How can I make it better?” or “Can I get your advice?”
7) Consider having someone else conduct your debriefs: Once you have a debrief guide, you could have someone else within your company conduct the debrief (such as an inside wholesaler or cold caller). You could also find someone outside of your company to do this work for you. If you are running a sales team, consider hiring an outside third party to conduct Win Loss Analysis interviews on behalf of your entire sales team.
There are a number of steps in the program that differ from the usual concept of debriefing prospects. What are those differences and why are they important?
Richard M. Schroder: The big thing I tell salespeople is not to debrief on the same call where the prospect tells you that you have lost the deal. This is a major mistake and in most cases, you will not get any meaningful feedback from prospects during this discussion. Why are prospects not forthcoming when they call to tell you that you lost the business? One reason for this is that when a prospect calls to tell you that you lost the deal, his primary concern is to tell you the decision and get you off the phone as quickly as possible. No one likes to give someone bad news; therefore, prospects feel uncomfortable during these conversations and are looking to get the call over with as quickly as possible.
Another problem with trying to conduct a debrief interview at this time is that as the salesperson, you will typically feel rejected, defeated, deflated and defensive. That’s a lot of emotions to handle all at once, and no one enjoys going through rejection. Whatever emotions you have at this point will prohibit your ability to successfully debrief a prospect. You need time to reflect and allow yourself to gain composure after defeat. It is virtually impossible for you to have all the right questions to ask at this particular moment and to ask them in the right frame of mind.
Here is an example of how to ask for a debrief interview:
“Mr. Prospect, I understand your decision and I respect it. I’m disappointed, because I really wanted to work with you and your company but I’m not going to try to change your mind. I wish you all the best in the future. If you recall, I had mentioned to you that my company conducts debriefs at the end of every sales cycle and you agreed to debrief with me. We do this so that we can continually improve our sales process and product and service offering. Can we set up a time in the next week or so to speak for 15 minutes? It would really be helpful to me. Do you have your calendar handy?”
There are many key points to be aware of in the above example. For one, it is important to let the prospect know that you are not going to try to change his mind. By letting the prospect know that you have accepted the loss and that you will not try to change his decision, you are putting the prospect at ease and as a result, he will be more willing to talk to you. Also, you have let them achieve their main objective for the call and they will be calmed by this. Make sure to let them know that you don’t like to lose but that you do like to learn as much as possible from every loss.
How can a sales representative and a company create a tool to debrief prospects more effectively in the future?
Richard M. Schroder: As I mentioned, sample debrief guides can be downloaded at Anova Consulting Debrief Guide. Any salesperson or sales team can start with these tools and customize them for their company’s products and services and their own sales process. If a company wants to take it to the next level, they should consider implementing a formal Win Loss Analysis Program whereby an independent third party conducts the interviews on behalf of the sales team.
You describe a Win Loss Analysis program. What is that program and why should sales managers consider adding it to their sales process?
Richard M. Schroder: One proven way to improve a sales team’s close rate is to implement what is popularly known as a Win Loss Analysis program, whereby an independent third party interviews prospects after buying decisions have been made. Through this type of process sales teams can learn the true, candid reasons why they win and lose.
Below are a few reasons why every sales manager should consider implementing a formal, independent program for their sales team:
1) A third party interviewer can get the complete truth from prospects during post decision debriefs. Prospects are more candid when giving feedback and criticism to an independent third party because they don’t have to worry about hurting the salesperson’s feelings or fearing confrontation, criticism or reselling efforts from sales reps (who often become defensive while receiving feedback). Given the option to remain anonymous, a prospect can feel at ease with a third party interviewer inviting the prospect to share any issues he or she might have had with the salesperson, sales process or a company’s products or services.
2) Tailoring sales training with actual Win / Loss data and feedback from prospects is a huge opportunity for sales teams to improve their selling efforts. Every year, sales managers spend significant time and money training their salespeople. However, most companies do little to verify that salespeople are actually implementing the right tactics in their interactions with prospects. A Win Loss Analysis program ensures that sales training focuses on the most critical and actionable sales performance issues
3) Third party feedback can become a comprehensive senior management tool. A Win Loss program delivers a reliable, objective and consistent tool that can be used by senior management to improve its products and services, as well as provide competitive intelligence. This information transcends the sales process and can become a critical conduit for strategic decisions.
The most important long-term goal and benefit of a Win Loss Analysis program is to increase a company’s new business win rate. This is achieved through an improved understanding of how a company’s sales effectiveness, products and services compare with the competition.
There is significant opportunity for many sales managers to improve their sales teams’ close rates by better understanding prospect perceptions. Over time, analysis can allow a sales team to charge ahead of its competition by continually keeping a pulse on industry trends, the competition, and needed enhancements to the sales process.
What is the first step that an organization should take toward having more great sales calls?
Richard M. Schroder: The first step to be taken is to fully understand why your sales team is winning and losing. This is the basis for winning more business.
What is next for Richard M. Schroder?
Richard M. Schroder: Writing a book while trying to grow a business is like trying to fix a flat tire while your car is still moving! I plan to regroup now and speak as much as possible on the subject to train salespeople on this overlooked final aspect of the sales process. I also plan to spend more time with my family since I spent many Sundays writing over the last year.
“Understanding why a deal is won or lost is critical, yet most salespeople have little (if any) understanding of the true reasons for winning and losing” writes recognized thought leader in Win / Loss analysis and sales training, and President of Anova Consulting Group, Richard M. Schroder in his opportunity creating and game changing book From a Good Sales Call to a Great Sales Call: Close More by Doing What You Do Best. The author describes how to develop and utilize an effective debriefing process to provide detailed analysis about why sales were really closed or lost.
Richard M. Schroder recognizes that all too often salespeople leave a prospect not ever knowing why the sale was never completed. Most sales representatives, and even their sales managers, simply move on to the next prospect, seeking the next sale. What is not understood by the sales team is that the same mistakes can be repeated over and over again, resulting in even more lost closing opportunities. Richard Schroder provides a comprehensive system for re-examining the lost sale to analyze what went right, and also to determine what also went wrong. This debriefing process provides the sales person with deeper insights into their own sales strategy, helping them to continue using the techniques that worked well. At the same time, and perhaps even more importantly, the debriefing concept will uncover mistakes that can be corrected and avoided in future sales presentations.
Richard M. Schroder understands that all sales representatives possess strengths and weaknesses that vary from person to person. Without a thorough assessment of these strengths and weaknesses, the salesperson will never move past the status quo position of the potential customer. For Richard Schroder, the status quo is as much of a competitor for sales representatives as the products and services offered by another company. Richard Schroder presents a logical step by step procedure, for learning the real reasons, that goes far beyond the features and benefits of the product or service. The author seeks to uncover the much more important relationship between the buyer and the seller. For the authoor, a good salesperson solves an important problem for the customer through open and honest discussion. The book focuses on the critical relationship between the salesperson and the customer, and not on the technical mechanics of the sales process.
For me, the power of the book is how Richard Schroder describes the crucial factor of open and honest communication between the seller and the buyer. Unlike many other sales books that teach tactics and techniques, the author helps the sales person build a positive and open sales conversation. Should the sale fall through without completion, Richard Schroder provides a complete debriefing process to uncover the real reasons for the failed sale. Since this debriefing concept is important, the process must be conducted using the best practices and proper etiquette. The book contains valuable chapters on how to debrief the client honestly and with mutual respect. Through the procedure outlined by Richard Schroder, honest feedback can be obtained, and mistakes can be avoided in the future.
I highly recommend the unique and insightful book From a Good Sales Call to a Great Sales Call: Close More by Doing What You Do Best by Richard M. Schroder, to anyone involved in sales from entrepreneurs, to sales representatives, to sales managers who are serious about understanding what really went right and wrong in a sales conversation. This book enters into the seldom discussed, but extremely important, area of the post-sales conversation debriefing process.
Read the sales building and very practical book From a Good Sales Call to a Great Sales Call: Close More by Doing What You Do Best by Richard M. Schroder, and discover the best practices for utilizing the sales debriefing concept. The book contains all of the tools and ideas necessary to design, develop, and utilize the very valuable debriefing procedure. The end result will be more closed sales, a much more effective sales team, and many more satisfied customers.
For Immediate Release
Contact: Andrew Cloutier
Anova Consulting Group, LLC
(617) 731-1045
andrew@anovaconsulting.com
BROOKLINE, MASS., February 12, 2013 – Win loss survey data from Anova Consulting Group shows that the proportion of plan sponsors remaining with the incumbent after conducting full 401(k) provider searches has continued to grow for the fifth consecutive year. Anova is a leading provider of Win / Loss and client satisfaction analysis in the financial services industry.
For the sales situations Anova researched in 2012, 31% of mid-large market finals with between $20MM and $500MM in plan assets resulted in the plan sponsor remaining with the incumbent recordkeeper, up from 28% in 2011 and 18% five years ago. This figure does not include non-competitive re-bid situations, which are an increasingly commonplace alternative to a full search / RFP process for plan sponsors who are not necessarily dissatisfied with their provider but conduct periodic due diligence reviews for fiduciary reasons. Anova has conducted over 1200 win, loss, and departed client interviews with mid-large 401(k) plan sponsors since 2007.
“Over the last five years, the percentage of plans conducting full-blown searches and electing to remain with their current providers has increased roughly 10% each year. If this trend continues, it will mean that in five more years, 50% of the plans conducting finals searches will remain with the incumbent,” said Richard Schroder, president of Anova Consulting Group. “While it speaks highly of industry-wide client service that so many sponsors are content to stay with their existing providers, this trend should not be discounted by sales and product development organizations.”
As search activity becomes increasingly competitive and 401(k) products and services become more commoditized in the mid-large market, retirement plan providers are striving to differentiate themselves and provide prospects with compelling reasons to leave their incumbents. A comparable product offering with comparable fees (or even a minor fee reduction) are infrequently sufficient to entice a plan sponsor to undergo the effort and uncertainty of a conversion to a new provider.
According to Schroder, “The sales teams that are beating the odds are doing a better job of creating immediate value and differentiating their firms’ offerings during the sales process. With increasingly informed buyers and the ever-growing involvement of sophisticated search consultants and retirement plan advisors, providers must clearly articulate their value propositions and offer a highly consultative sales process customized to a sponsor’s specific needs.”
Established in 2005, Anova Consulting Group is a leading market research and consulting firm focused on Win / Loss analysis and client satisfaction analysis. By helping its clients understand why they win, lose and retain business, Anova provides strategic perspectives to its clients, driving better decision-making, product development, sales effectiveness, client service, and continuous improvement. Richard Schroder, president of Anova, is author of the Win Loss Analysis book titled From a Good Sales Call to a Great Sales Call (McGraw-Hill), which details how learning from post-sale debriefing helps close more sales.
For Immediate Release
Contact: Andrew Cloutier
Anova Consulting Group, LLC
(617) 731-1045
andrew@anovaconsulting.com
BROOKLINE, MASS., February 7, 2012 – Analysis of several years of win / loss survey data from Anova Consulting Group, a leading provider of customized market research, sales training and consulting services in the financial services industry, shows that retirement plan sponsors who conduct marketplace reviews with finals presentations are 55% more likely to remain with their current provider today than they were as recently as four years ago.
For the sales situations Anova researched in 2011, 28% of mid-large market searches with between $20MM and $500MM in plan assets resulted in the plan sponsor remaining with the incumbent recordkeeper, compared to 18% in 2007. This figure does not include non-competitive re-bid situations, which are an increasingly commonplace alternative to a full search / RFP process for plan sponsors who are not necessarily dissatisfied with their provider but conduct periodic due diligence reviews for fiduciary reasons. Anova has conducted over 900 win, loss, and departed client interviews with mid-large 401(k) plan sponsors since 2007.
“With the difficult economic environment of the past few years, most companies are more focused on their core businesses than with evaluating their 401(k) plans. Consequently, there’s been a slowdown in RFIs and RFPs, which leads to fewer finals situations, and even then sponsors have been more likely to remain with the incumbent,” commented Chris Cumming, Senior Vice President at Great-West Retirement Services.
According to the plan sponsors, retirement plan advisors, and consultants interviewed, one driving force behind this trend is the increasing commoditization of 401(k) product and service offerings in the mid- large market. “As fee spreads compress and open investment architecture, state-of-the-art technology and customizable participant communications are offered by more competitors, sponsors are increasingly unwilling to undergo the uncertainty and additional effort of a conversion,” said Richard Schroder, president of Anova Consulting Group. “Results from the plan sponsor research we’ve performed over the past decade show a drop-off in provider changes due to core product offering differences — client service issues are now a key catalyst for provider changes.”
“At Putnam, we are seeing sponsors look to improve service delivery, or take advantage of innovation that didn’t exist 3-5 years ago. There is clearly a growing market demand for providers to deliver maximum value to plan sponsors and an enhanced participant experience that leads to higher savings and better retirement preparedness,” stated Edmund F. Murphy III, Managing Director and Head of Defined Contribution at Putnam Investments.
Great-West has observed a similar trend in the mid-large market. “When sponsors conduct a finals process and switch recordkeepers, they are looking to upgrade their overall plan with the latest features and sophisticated investment capabilities while achieving a competitive price point,” added Cumming.
Another driver of the decline in 401(k) provider changes is sales-related. Failure to differentiate is a frequent sales process critique among bids lost prospects who elect to remain with the incumbent. “In an increasingly competitive marketplace with a finite amount of deal flow, sales teams really have to bring their “A” game to win the business,” suggests Schroder. “Before entering a finals presentation, I would urge any sales team to identify 4 or 5 ways in which they are different from the competition and articulate them during the presentation.”
According to Patrick Murphy, Managing Director and Head of Sales at New York Life Retirement Plan Services, “A ‘me too’ approach is not effective in sales finals presentations. Plan providers have to develop products and services with differences that are truly meaningful to plan sponsors. Those providers who can demonstrably add value and have an impact on plan results will be the winners going forward.”
Established in 2005, Anova Consulting Group is a leading market research and consulting firm focused on Win / Loss analysis and client satisfaction analysis. By helping its clients understand why they win, lose and retain business, Anova provides strategic perspectives to its clients, driving better decision-making, product development, sales effectiveness, client service, and continuous improvement. Last year, Richard Schroder, president of Anova, released a book about Win Loss Analysis titled, From a Good Sales Call to a Great Sales Call (McGraw-Hill, 2011), which details how learning from post-sale Win / Loss debriefing helps close more sales.
February 7, 2012 (PLANSPONSOR.com) – Retirement plan sponsors who conduct marketplace reviews with finals presentations are 55% more likely to remain with their current provider today than they were as recently as four years ago.
According to survey data from Anova Consulting Corp., for the sales situations in 2011, 28% of mid-large market searches with between $20MM and $500MM in plan assets resulted in the plan sponsor remaining with the incumbent recordkeeper, compared to 18% in 2007. This figure does not include non-competitive re-bid situations, which are an increasingly commonplace alternative to a full search/RFP process for plan sponsors who are not necessarily dissatisfied with their provider, but conduct periodic due diligence reviews for fiduciary reasons.
“With the difficult economic environment of the past few years, most companies are more focused on their core businesses than with evaluating their 401(k) plans,” said Chris Cumming, senior vice president at Great-West Retirement Services. “Consequently, there’s been a slowdown in RFIs and RFPs, which leads to fewer finals situations, and even then sponsors have been more likely to remain with the incumbent.”
According to the plan sponsors, retirement plan advisers and consultants interviewed, one driving force behind this trend is the increasing commoditization of 401(k) product and service offerings in the mid-large market.
“As fee spreads compress and open investment architecture, state-of-the-art technology and customizable participant communications are offered by more competitors, sponsors are increasingly unwilling to undergo the uncertainty and additional effort of a conversion,” said Richard Schroder, president of Anova Consulting Group. “Results from the plan sponsor research we have performed over the past decade show a drop-off in provider changes due to core product offering differences—client service issues are now a key catalyst for provider changes.
“At Putnam, we’re seeing sponsors look to improve service delivery, or take advantage of innovation that didn’t exist three-five years ago,” said Edmund F. Murphy II, managing director and head of Defined Contribution at Putman Investments. “There is clearly a growing market demand for providers to deliver maximum value to plan sponsors and an enhanced participant experience that leads to higher savings and better retirement preparedness.”
Great-West has observed a similar trend in the mid-large market. “When sponsors conduct a finals process and switch recordkeepers, they are looking to upgrade their overall plan with the latest features and sophisticated investment capabilities while achieving a competitive price point,” Cumming said.
Another driver of the decline in 401(k) provider changes is sales-related. Failure to differentiate is a frequent sales process critique among bids lost prospects who elect to remain with the incumbent. “In an increasingly competitive marketplace with a finite amount of deal flow, sales teams really have to bring their “A” game to win the business,” suggests Schroder. “Before entering a finals presentation, I would urge any sales team to identify four or five ways in which they are different from the competition and articulate them during the presentation.”
Patrick Murphy, managing director and head of sales at New York Life Retirement Plan Services, added, “A me too” approach is not effective in sales finals presentations. Plan providers have to develop products and services with differences that are truly meaningful to plan sponsors. Those providers who can demonstrably add value and have an impact on plan results will be the winners going forward.”
Richard Schroder, MBA ’95, founded Anova, his market research and strategy consulting firm, in 2005. “For seven years, I worked for a firm where I learned the trade and helped build the company,” says Schroder. “I owned a piece of it, so when it was sold, I was able to start Anova. We now have seven employees. We’ve doubled our revenue every year since inception.”
Anova Consulting Group, LLC—named after a statistical term for data analysis— provides customized market research and management consulting to senior executives at financial services firms in the defined contribution and defined benefit space. Some of Anova’s clients include Charles Schwab, New York life, ADP and Putnam Investments.
The company has three main lines of business and focuses on helping clients improve client satisfaction, increase new business win rates and capture a larger share of the IRA rollover market. “Our business is a combination of a product and a service,” says Schroder. “Marketing for Anova is very specific. It’s all personal, one-on-one relationship building.”
Schroder enjoys the challenges and creative possibilities of being an entrepreneur. “I’m more passionate now than when I was an employee,” he says. “I think about my business all the time.”
By Mariana Lemann January 21, 2011
Client service trumps all other criteria in plan sponsors’ selection of 401(k) plan providers.
That’s according to a new survey out from Anova Consulting Group that is based on input from more than 300 midsize- and large-plan sponsors.
The results show that client service has gained in importance in sponsors’ decisions to remain with or swap out providers. And while client service is not a big factor in sponsors’ creation of a short list of providers, it becomes a bigger factor in the final stages of the decision-making process, the study shows.
Plan sponsors surveyed were only 12% more likely to cite client service as a factor in their initial search criteria, but when it comes to their final decisions, 33% were more likely to mention client service as the deciding factor.
The survey was based on telephone interviews conducted within the past year with plan sponsors in the month following their decisions to either switch or retain providers.
Client service has become much more important in the 401(k) space because the market has become much more competitive, says Rich Schroder, president of Anova Consulting Group
“As the industry has become more commoditized, plan sponsors are beginning to base their decisions more on client service,” he says.
A greater focus on fee transparency and the resulting compression of fees have also contributed to the commoditization of plan features in the retirement plan market.
The rise of open architecture and the dissemination of automatic plan features also have made fees less of a factor than the quality of the service rendered to clients, Schroder says. “What we are learning is that as these things become more on par with each other, providers have to go down the value chain.”
Plan providers catering to the middle and large end of the marketplace agree that client service is more important now than it has ever been.
“The fiduciary perspectives on pricing and open architecture have been met and the marketplace is very competitive from a pricing perspective and from an open architecture perspective,” says Wayne Finnegan, head of institutional corporate markets at ING U.S. Retirement Services. “You start to think of the less commodity- like aspects of service or delivery and the importance that has been placed on the experience of the representative that will be handling that account.”
The quality of the service rendered by providers to plan sponsors ultimately depends on intangibles like the client’s chemistry and personal fit with the relationship manager handling the account, Schroder says.
That has been the experience Putnam Investment has had with its clients over the last few years.
“If you look at why plan sponsors choose to leave their current provider or at least look at options in the marketplace, the level of client service is a contributing factor if not a driving factor,” says Edmund Murphy, III, managing director and head of defined contribution at Putnam.
But the decisions clients make are driven by more than client service, Murphy says. “It is not only about being responsive to a customer, but it is being proactive.” He touts Putnam’s client-to-relationship manager ratio, and says the firm has one of the lowest ratios at a time when “a lot of firms [are] cutting back on front-line associates.”
Fidelity Investments attributes the retention of a 20-year contract with Hewlett-Packard to client service and investments in technology. The behemoth announced yesterday that it has extended its relationship with HP for an additional five years. The deal consolidates more of HP’s retirement plan under the Fidelity umbrella.
“They look at this as an opportunity to look at their plans and to consolidate them under one provider,” says Jeffrey Lagarce, executive VP of workplace investing at Fidelity Investments. But Lagarce says that while client service is important, sponsors assess providers on a variety of factors.
“Very large clients look at all parts of the equation: competitiveness of fees, technology capabilities, Web capabilities, plan participant retirement planning tools. We have had a long relationship [with HP] and we’ve been able to demonstrate our ability to invest in technology, offer this at a competitive market price, and they have been very satisfied with the service.”
January 19, 2011 (PLANSPONSOR.com) – According to a new survey by Anova Consulting Group, retirement plan sponsors report that client service has now become the number one or number two reason for choosing a new plan provider.
In an earlier survey in 2008 and 2009, client service ranked number three or number four in importance, after fund selection and fees, according to a press release.
Among the reasons for the increased importance of client service are the continued commoditization of funds and technology in the retirement plan marketplace as well as growing fee pressure affecting all providers. Another reason, according to Rich Schroder, president of Anova Consulting Group, is that “many recent plan turnovers have tended to be among plans that are more complex in nature and need a stronger client service team to handle them.”
The survey shows the value placed on client service rose as retirement plan sponsors reached the final stage of their buying process. While plan sponsors were only 12% more likely to refer to client service as a factor in their initial search criteria, 33% were more likely to cite it as a top reason for the final decision.
“These results should be a wake-up call for retirement plan sales teams that are not currently bringing the appropriate service team members to finals presentations,” said Schroder, in the press release. “Plan sponsors want to know how their account will be managed once the sale is made, so for sales teams, it’s critical that relationship managers not only be in the room, but be skilled at presenting in finals situations.”
The 2010 Anova survey included responses from more than 300 plan sponsors in the middle and large markets (plans with over $25 million in assets under administration).
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