Cash & Liquidity Management

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What Matters Today - #3: Relationships In the last two editions of TMI, J.P. Morgan has explored some of the issues that matter most to treasurers today, focusing firstly on risk management and secondly on efficiency. In the third article of the series, J.P. Morgan examine the importance of relationships between corporations and their banking partners and how banks such as J.P. Morgan are ensuring a strong, positive relationship from the first engagement through many successful years of working together. Over recent months, when both banks and corporations have been under stress, the right relationships, built on trust and open communication, have been essential in weathering the difficult times.

What Matters Today
#3: Relationships

by Nicholas Blake, Corporate Sales Executive, EMEA, and Melanie Wells, Client Services Executive, EMEA, Treasury Services, J.P. Morgan

In the last two editions of TMI, J.P. Morgan has explored some of the issues that matter most to treasurers today, focusing firstly on risk management and secondly on efficiency. In the third article in the series, we look at the importance of relationships between corporations and their banking partners and how banks such as J.P. Morgan are ensuring a strong, positive relationship from the first engagement through many successful years of working together. Over recent months, when both banks and corporations have been under stress, the right relationships, built on trust and open communication, have been essential in weathering the difficult times.

Building a client services organisation in a global bank is a challenging and complex task.

The importance of relationships between banks and their clients has been discussed a great deal since the financial crisis first struck. Supporting clients through good times is easy, but it is in challenging periods that a bank can stand out from its competition by delivering the relationship support that is easy to sell but hard to deliver. Typically, many people assume that a relationship with a bank refers to the willingness or ability to provide credit; in reality, banks assist their clients in a variety of ways. An effective relationship between a bank and its client requires a clear and detailed understanding of the client’s business and challenges, both as an individual company and across its industry. This enables the bank to propose the most effective solutions to business problems, some of which may not yet have even  become apparent, such as regulatory changes affecting a particular industry. Equally important is for the client to understand its banking partner’s long-term strategy and be confident that it fits in with their own growth strategy. 

A proactive approach

J.P. Morgan has had a culture of fostering confidence and trust for many years. By leveraging expertise as a trusted global provider, the firm looks to help clients easily and reliably collect, move, concentrate and invest their cash. A relationship based on trust relies on straight talking. Just as J.P. Morgan would expect a client to tell us if we were not delivering according to their expectations, so too will we tell a client if we think its treasury or cash management strategy is at odds with its corporate objectives. Clients are looking for their banks to be proactive in delivering solutions, anticipating their business challenges and providing foresight of new regulatory requirements. Maintaining close relationships with each client is the only way that a bank can gain the necessary level of understanding to be able to add value to a client.

A client-focused model

Building a client services organisation in a global bank is a challenging and complex task. It is essential to align the service model with clients’ needs and behaviours, which is no small feat for a bank such as J.P. Morgan which supports over 100,000 clients globally, with a diversity of sizes, cultures, business organisations, objectives and product needs. Consequently, as one size does not fit all, it is important to ensure that a variety of service offerings are available and that these can be combined and tailored in a way that meets clients’ support requirements.

The critical element in achieving this is to ensure a full understanding of the client, which starts from the very first engagement and continues as an ongoing journey. A variety of factors will influence a client’s support needs, not least the countries in which it needs banking services, language requirements, business and national culture, time zones, business segment or industry, products used and degree of technical sophistication. Sales professionals, relationship officers and client support staff all have a role to play in ensuring that the support arrangements are suited to the needs of a particular client. Whilst the sales team will conduct the initial communications with a client, we ensure that client services personnel are involved as early as possible in the sales process, often while we are responding to a request for proposal. This ensures that commitments made up-front are realistic and that client expectations can be fulfilled. By involving client services as early as possible, we are also able to provide as seamless a hand-over as possible between sales and client services. 

Structuring a client support model

Having fully understood a client’s requirements, we structure a support proposition, leveraging one or a combination of the support tools that are available, including online self-service tools, local support and pooled central resource. Designing a client service approach for multinational institutions poses particular challenges due to the diverse nature of their requirements. For example, a centralised company may need local support for its regional treasuries and/or shared service centres, in addition to a relationship officer working with head office or group treasury to ensure that the overall banking needs of the organisation are addressed. A decentralised organisation may require on-the-ground support for geographically diverse business units in their local language, backed up with 24-hour support from a central support centre. Our model is flexible yet cohesive to ensure the client feels that it is working with one organisation.

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