Building relationships

Phillip Scott from Barclays Capital explains what sales at an investment bank is really about
Investment banking
Types of work

So, does distribution mean sales?

Distribution is sales, yes; it's how we distribute our product to our clients.

And are you selling financial products, or financial services, or a mix?

We sell a mixture of everything; we sell across all asset classes now. Our cash equity capabilities have been significantly expanded as a result of the Lehman acquisition and the investments in Europe and Asia, but we did already trade equities so this is an expansion of our capabilities. Our clients are mainly institutional. They're the big banks, the asset managers, the hedge funds, the real money clients and the pension funds, as well as some corporate clients.

Can you give us some practical examples of the kind of services you might offer your clients?

We offer services across the full range of products - both flow and much more structured products. In practice that means the full range from say a very vanilla spot FX transaction, through to a much more complex balance sheet focused structured trade. We have a very strong franchise in both flow and structured products, where we have a multi-asset approach by country.

Can you give me an example of a structured product?

There is a range of complexity within structured products. At one end of the scale we have more simple products such as an equity-linked bond for distribution to retail clients. At the other end of the scale there are more tailored solutions that are created to solve specific risks faced by clients. For example, we may use a structured product to help a pension fund reduce their risk exposure and optimise their investments.

How does the sales team interact with clients?

Nowadays there's many ways of communicating with clients; our interaction with them will vary depending on the type of product being sold. The day on a flow desk would be quite different to the day on a structured product desk - but there is definitely some common ground. Everyone needs to know what's going on in their market, which factors in the wider economies will impact their clients and what data is coming out that day.

A salesperson will typically look after a number of main clients. On the flow side, electronic platforms are a widely used tool and are essential for communicating with our clients. These platforms are very powerful for speedy and transparent execution of flow business. We have a fantastic award-winning platform called BARX, which is our main ecommerce offering and is used by a broad spectrum of our clients.

*How does the sales team interact with the trading team? *

The salesperson is really the interface between the client and the trader. Just as we develop close relationships with our clients, we also develop close relationships with our traders. Sometimes the trader might talk directly to the client; we even try to take our traders out to see our clients so that they can know who they are trading for. But in sales we don't actually run a risk book, we understand the client's needs and then work closely with trading who facilitate the transactions for our clients and manage the risk associated with the transaction.

*Is it part of your job to say to a client, "actually I don't think that's a very good idea", or is the customer always right? *

I believe that our job is to give our honest opinion, which may well be to say that you do not think it is a very good idea. The challenge then becomes to help them develop an approach that is best suited to the client in achieving their goals.

Sales is about building a relationship with the client. When you start your career as a graduate you first learn what the products are and then you focus on developing your initial client base. You might start off dealing with more junior people at the client and then gradually as your experience grows and you become more senior in your organisation, your client base will evolve. You build relationships which you keep for many years. That's the same for both flow and structured products.

*Is there scope to do a bit of both, some structuring and some flow products, or do you choose one thing or the other? *

You can change throughout your career. There are people that have gone from structured to flow and vice versa. The way in which we cover our clients is generally determined by the clients themselves. A client who has a very strong relationship with a structured salesperson may also want to do their flow business through the same person, so there's crossover there as well.

*What does it take to succeed in sales? *

The salespeople that do well are the ones who develop strong relationships with their clients. So it's important that you can get on well with people, that you can understand people's needs, that you can look at financial and technical problems and come up with good solutions. But we have a range of functions within sales. We have some people that purely do structuring, who will only go to see the clients with other salespeople. So maybe that's an area you go into if you don't want to work with the same clients every day.

The key to success is to develop the ability to generate the very best ideas, execute to the highest standard and to achieve excellence in client service.

*What's it been like over the past year? Has the financial crisis affected what you do? *

It's been busy, it's been turbulent, but where there's been instability amongst our competitors it has presented opportunities to help us grow our business. Most obviously, we had the chance to acquire Lehman's business in the US.

*The acquisition of the Lehman's business in the US has given you a bigger presence in America, but has it also affected your operations in Europe? *

It has given us a much broader platform in the US, which we can leverage here. Specifically, we are building out our equities and prime services businesses in Europe. In addition, our credit platform has continued to expand and benefit from our new affiliation with the market leading US franchise. We are always seeking out new ways to grow our business by working more closely with our colleagues across the world.

*What would you say to graduates who are perhaps put off by a career in the financial services sector as a result of the events of the past year, or by some of the negative press that we're still seeing about the culture in the City? *

It's an interesting question. Fundamentally, we offer a range of products and solutions that our clients need in order to manage their risk and investments - what we provide is of fundamental importance to them. The economy will always need banks. Put simply, when people put their money into a pension fund each month it doesn't just sit in a pot somewhere until they need it; that money is actively managed. It's the same when they put their money in a bank account, or when they buy a particular financial product. I think it's still a very exciting career. The opportunities when you join a big bank are very diverse. You can take many different career paths through the same organisation in many different countries. It should still be a very attractive option for graduates. We spend a lot of time sending people to campus so that students can ask questions and really understand what it's all about, how it actually works and what it's like being a salesperson at Barclays Capital.

*What are the typical misconceptions you often encounter when you go out on campus? *

One of the most common misconceptions is that the sales function is the part where we cold-call clients to try and sell them products that they may or may not be interested in. In fact, it's actually about developing long term relationships with our clients based on trust and an excellent quality of service. To do this we need to leverage all of the parts of our firm and build similarly strong internal relationships with trading, research and infrastructure. We don't say: "Here's the phonebook, start at 'A' and let me know when you've finished 'Z'."

One of our key objectives is making is clear just how exciting, challenging and rewarding a career here is. We encourage students to spend time talking to our salespeople on campus to really understand what it's like to work with us in sales.

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