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Tory conf latest: Co-op Bank bans staff sales incentives

Co-operative Bank 480

Co-operative Bank chief executive Barry Tootell says sales incentives for bank staff are “wrong” and has banned them in branches.

Speaking at a Co-op fringe event on banking at the Conservative conference in Birmingham today, Tootell said banks should focus on good customer service rather than short-term sales targets.

Last week, the bank banned incentives for selling products in branch and introduced an incentive system based on customer service. It will be rolled out to its call centres next year.

Some 3 per cent of Co-op branch staff were incentivised to sell and will now receive bonuses of up to £400 per quarter based on customer service performance, judged by mystery shoppers, independent experts and questionnaires.

Tootell said: “Frankly, if your business is about delivering excellent customer service then why would you incentivise selling?

“At banks a customer walks through the door and staff decide they are going to sell that customer a credit card whether they like it or not, because they have a target to sell credit cards that day. It is the wrong way for banks to approach it but that is what happens.”

Last month, the FSA launched a crackdown on sales incentives after a year-long investigation. It is investigating Lloyds Banking Group over its practices.

Treasury select committee member Andrea Leadsom said it is tough to incentivise staff based on service.

She said: “Metro Bank also incentivises on customer service and it is struggling. The biggest culprit is free in-credit banking which is the biggest misnomer ever and the media has conspired in it.”

Leadsom said new banks must offer free banking to compete but need to sell credit to pay for the services, creating a “massive barrier” to entry.

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Comments

There are 10 comments at the moment, we would love to hear your opinion too.

  1. I remember when it was ok to sell somebody something…MacDonalds ask you if you want to go large or try a meal deal, check out the multi-buys and buy one get one free at every supermarket, maybe retailers should just serve and not help customers and maybe bank tellers should just let clients cash sit in those obscure closed accounts that pay 0.010% and not mention better accounts offering better value.
    This is the scandal that won’t be fixed Barry never mind all this sanctimonious hand wringing

  2. Larry in London 9th October 2012 at 5:05 pm

    Hello Chums!

    Holy Crap! Just why would anyone do anything so nasty as incentivise selling?

    I just can’t imagine how any decent hardworking, honest, upright self-respecting person would ever sink so low as to even consider offering an incentive to sell something.

    But now it’s only a matter of time before the P45s start stalking the corridors of the Co-operative. Only a matter of time.

    Makes be go all gooey just to think about it.

    Love and kisses

    Larrykins xxxx

  3. Incentives aren’t the problem and never were.

    The problem is the implied theats to job security if targets/goals/objectives aren’t reached, the ‘performance improvement plans’, the ‘structured assistance’, performance management culture. This is just a cynical attempt by the co-op to curry favour with the public. Sorry mates, nobody’s that stupid.

  4. William Fortune 9th October 2012 at 5:46 pm

    what absolute drivel, Talk about two faced, does this guy think that the public are daft ? this bank is the same as any other greedy bank and if he had that strong feelings about the incentive culture why has he waited until the heat is on to say and (maybe) do something. Hope you enjoy your smoked salmon sanri tonight….Meantime get real.

  5. Yep – this is just Co-op pretending to be ever so ‘ethical’.

    No incentives? That is not the issue in this bank. The issue is the extreme stress the staff are put under to meet their target – this will be there – there will be no reward scheme to hit it – the incentive is not to be placed onto a Performance Improvement Plan

  6. the co-op does offer incentives to sell hahahah funny peter marks.

    p45’s have already been flying from this defunct institution, they didn’t call it incentives they called it churning because people like “marks” dont know what customer services is, whatever happened to treating customers fairly?
    what was that organisation called again – FSA was it.
    they slapped a lot of paint over their compliance department and blamed every one else for their useless late arrival on the scene,

    the tories are the same, blaming the ever useless government before them, it seems it only takes those politicans 14 years to get something done, enough time to sort out the ever lasting recession.

  7. What about the incentive of not losing your job?

    What is needed is a culture whereby staff are rewarded for correct compliant advice.

  8. Worked for them up to the day my guaranteed salary ran out but the writing was on the wall 90%of salesman were in debt to the company so it was bye bye.
    The ‘systems’ they had were insane. Had to complete in front of client, explained to sales manager it was impossible, so he showed me how I should keep the laptop lid unshut and complete later. That is just an example of the craziness.
    It won’t be any different now- they all talk the talk.

  9. I think Barry needs to ask his area and regional managers about the the spreadsheets that they pour over on a daily basis scrutinising individual advisors seller trends. They want every advisor to sell 3 products to each cust, and this is monitored on a daily basis. The only sales they like are fee paying bank accounts and credit cards!

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