SDM GROUP 3 – SECTION B

Lincoln Financial Group: Making LFD a Reality
Arun (138) Harish (144) Sudhish (183) Rahul (230)

2011

INDIAN INSTITUTE

OF MANAGEMENT

KOZHIKODE

The relationship management team would also be able to work towards strengthening the broader relationship between the firm and the LFD. It would help the sales management team to be focused on managing the sales force and the relationship management team to be focussed on getting the shelf space.1) What are your reactions to Thompson and Miner’s implementation plan? How well did the various pieces of the new sales strategy work together? LFG’s distribution approach had a lot of drawbacks and some of them included  Lack of coordination among various wholesalers which led to a situation where in multiple people within the same organization approached MGA’s with different product LFG never gave any incentive for the MGA’s for selling products from more than one Lincoln wholesaler Wholesaler/FA relationship is an important one in this model and there were concerns about the level of capabilities among the various wholesaling groups   LLD was formed with an intention to bring the entire wholesaling efforts of LFG under one umbrella which would bring in more customer intimacy and help the firm in serving their customers much better. LFD began to show more and more success in terms of coordinating the . This is where the notion of channel heads and the new sales structure began to pay off. It was also a good move to separate relationship management from the wholesaling function and elevates it to a status equal to it. Paine Webber and Smith Barney. There was also an emerging trend among the LFG clients to go for solutions-oriented sales and selling solutions required a much more integrated organization than LFG’s existing distribution structure. Thompson and Miner executed the plan to separate sales & distribution from product management business extremely well. The new sales strategy started showing results immediately and the initial validation of the LFD business model came with the acquisition of two clients. The idea was to remove the sales and distribution responsibility from each of its individual businesses and aggregate them all into a single separate distribution company. on the channel head. Such a deal with the above two clients would have been extremely difficult for Lincoln in their previous siloed distribution models. This would create an incentive for them to explore increasing shelf space across every product line. They had to build this model without much cooperation or support from within the organization. And even if someone was interested in pursuing it there was little formal mechanism for that to happen. Earlier there was little incentive for either the wholesaler or the business head in one product area to pursue sales for another area. The new sales structure created under this model was also impressive as it laid the responsibility of maximizing delivery of all Lincoln’s products into a particular channel.

Hence LFD started upgrading both size and quality of LFD’s sales force. It can be used to find the areas of strength and weakness of each wholesaler which would help the firm in giving effective training. 4? What can’t you learn? Exhibit 4 shows the Sales Performance Aggregate Scores for LFD wholesalers. There is a probability that the wholesalers may not be truly honest while answering the questions as they might have fears that it would affect their appraisal as well as job security. It can be used to compare LFD’s top wholesalers with the rest of the sales force. The wholesalers in LFD didn’t have enough skills to sell solutions instead of products. Hence this showed more success in terms of coordinating the efforts of each teams The model itself placed high performing officers into their correct management teams and calibrate their current skill level The model gives common language and common understanding for valuation. 2) What can you learn from Ex. It provides individual assessment of each wholesaler and also helps the firm in figuring out the ‘A Players’ among them. Although the method is a great tool in assessing the quality of sales force it may not reveal all the information. The business was shifting away from product sales and becoming one revolving around solution sales. The new model also exposed the fact that LFD didn’t have enough wholesalers. 3) What are the benefits and drawbacks to the quantitative approach they’ve taken to skills management? Benefits:       This ensure that the LFG firm’s portfolio of talent have enough “bench strength” in their various business Product manager in each of the manufacturing business were responsible for securing shelf space More focused approach towards each management respective goals. This gave individual roadmap for improvement It helped to articulate the characteristic required in manager and salesperson .efforts of wholesalers toward growing sales for all Lincoln products. It shows the quality of the Sales force at LFD.

to find opportunity and to feel empowered to find solutions inside Lincoln. The model resulted LFD managers to rethink how they should reinforce the desired change in mindset and behaviour.Drawbacks:       Talent management process eventually resulted in majority of top manager leaving LFG LFG paid richly for above average results but below average for market result Major gap between the level of skill that sales force and wholesaler needed to achieve The competency model was highly correlated with the manager’s performance. The effort made was initially not conforming to the goals and in the first meeting sales man echoing the sentiment that they already had a well developed set of sales tactics which was not required. Thus LFD built more non-monetary rewards into the pay plan. The group then went onto design the basic structure of “Delivering your value” program that would train the wholesaler. Hence they pulled together 18 sales manager in order to develop a single. The program delivered to small group of wholesaler comprised with the mix of wholesaler from different product and channel area helped to build esprit de corps within LFD. After a number of joint meetings. The company has defined the best wholesaler on the basis of including . The competency model really made it work in the end. The model was future focused and involved high risks of failure if people were not effectively hired The competency model was not aggressive enough 4) Do you see in this plan the potential for a significant impact on Lincoln’s business? Why or why not? The competency model object was to move the sales force form “command and control” mentality to one in which wholesaler were taught to ask questions. integrated script would use as a guide for their interaction with customer. the group of sales manager aligned to the goal to make intermediaries indispensable to client.

them as team player. This led to long term relationship with its distributor. As a result. top wholesalers under the new plan reacted positively and were happy to trade lower base pay for unlimited upside. handing off business opportunity to other and recognizing opportunities. .

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