Campbell And Bailyn’s Boston Office Case Study
The ‘sub-prime’ crisis triggered by the meltdown of the US mortgage backed-securities market in 2007 was a precursor to the global financial crisis. It would drastically change the competitive landscape for all firms in the financial services sector, including Campbell and Bailyn (C&B), one of the world’s five largest investment banks.
In response to a loss of clientele to competitor firms, Ken Winston (C&B’s Boston Sales Office Director) assembled the five most successful salespeople into a Key Accounts Team (KAT). Having previously enjoyed the autonomy of selling a diverse array of products to their own clients, these five ‘Generalists’ would now ‘Specialize’ only in one specific financial instrument, and subsequently, would have to share their accounts. This increased the level of task interdependency between KAT members, necessitating closer collaboration when performing complex multiproduct sales.
Amongst other factors, Winston blamed the loss of clientele on a lack of detailed product knowledge possessed by his salespeople. One customer stated that the ‘Generalists’ were “jacks of all trades and masters of none.” Given the salespeoples’ apparent lack of product expertise, it is difficult to see how simply reassigning Generalists to become Specialists to focus on a specific product line would actually address this problem.
What other options might Winston have considered to quell the haemorrhaging of clients to rival firms? One alternative he might have contemplated was to seek the opinions of their clients. Customer satisfaction surveys are a proactive way of identifying customer concerns, and to delve deeper into their psyche to determine what expectations they have in regards to service standards and the relationship in general. (Vance 2009) Arguably, this is an action that should have been taken before activating such an audacious restructuring strategy. Exposing the real motivations and priorities of their customers would have aided the formulation of a more tailored approach
meet their needs.
1.2Knowledge Sharing and Collaboration
If proven that inferior product expertise was a determinant of clientele loss, then this deficiency should have been addressed with the ‘Generalists’ in question. While the option of formal training was dismissed by Winston, the important role that is played by New York based Product Managers should not be overlooked. They are responsible for providing support and technical information on C&B’s saleable financial instruments. Accordingly, closer communication, collaboration and knowledge sharing between the two parties would appear to be critical in enhancing salespeoples’ product expertise.
To pave the way for effective knowledge sharing between salespeople and Product Managers, emphasis should be placed on building the relationship between the two parties. Their geographical dispersion is an obstacle, however, the growing use of computer-mediated communication and virtual teams is seen as an efficient way to combat such challenges. (Hertel, Geister and Konradt 2005) To support these virtual interactions, management might also consider sporadic face-to-face meetings (Al-Ani, Horspool and Bligh 2011), workshops and other team building exercises (social activities, for example) to foster positive exchanges and trust between the relevant staff. (Labrosse 2008)
Besides C&B’s Product Managers, Boston’s Specialists might be seen as another untapped source of specialised product knowledge. Winston might have encouraged mutual knowledge sharing between the Specialists and Generalists, potentially benefiting both sets of salespeople – Generalists would develop expertise in products where their experience is lacking; and, Specialists would be exposed to products outside of their fortes, further aiding their career development.
A dated view of knowledge sharing within organisations identifies the ‘knowledge is power’ rationale, whereby employees are averse to sharing information or ideas with colleagues in the belief that it threatens their internal power base. (Boer, Berends, and van Baalen 2011) This view is
changing however, as the obvious benefits of knowledge sharing (innovation, productivity and organisational efficiency) are seen to outweigh the costs. (Chait 2012)
The challenge to Winston in this case therefore, would lie in his ability to facilitate knowledge sharing between his salespeople. The ‘Seven Methods of Influencing Behaviour’ has been identified as a tool that can be applied to develop knowledge sharing initiatives within organisations. (Nevis, Lancourt and Vassallo 1996; quoted in Chait 2012) ‘Persuasive communication’ (influencing salespeople of the importance of knowledge sharing), ‘structural rearrangement’ (assigning Specialists to a Generalist in an assistant or subordinate role) and ‘role modelling’ (identifying key Generalists to take a leading role) are the three most pertinent of these methods available to Winston.
Winston is a respected and trusted leader, and is viewed as a role model by many of his staff. Nevertheless, his strategy would appear to threaten this trust as it undermines the autonomy, growth prospects, and (potentially) the commission earnings of his top salespeople. While resistance to organisational change is not uncommon, a range of alternatives were available to Winston which might have been preferable to his restructuring plan – namely, the use of surveys and client feedback to properly attend to customer needs, and enhanced knowledge sharing and collaboration between Product Managers and his Salespeople.
Al-Ani, Ban, Agnes Horspool, and Michelle C. Bligh. 2011. “Collaborating with ‘virtual strangers’: Towards developing a framework for leadership in distributed teams.” Leadership 7 (3): 219-249. Doi: 10.1177/1742715011407382
Hertel, Guido, Susanne Geister, and Udo Konradt. 2005. “Managing virtual teams: A review of current empirical research.” Human Resource Management Review 15 (1): 69-95. doi: 10.1016/j.hrmr.2005.01.002.
Labrosse, Michelle. 2008. “Managing Virtual Teams.” Employment Relations Today 35 (2): 81-86. Doi: http://dx.doi.org/10.1002/ert.20205