Are you a busy fool?

While volume transactions are low there is little to be gained by being “busy fools” and chasing enquiries that are unlikely to convert into genuine business…

I feel like a man standing on a fault line after a quake. The tremors seem to have stopped but I don’t know if there are more aftershocks to come. I am checking myself over to see if I am still in one piece and I seem to be. There is widespread devastation out there and I am looking around warily to see if some of the structures destabilized by the main quake may yet come tumbling down.

We are told that the economy is now in recovery, albeit a very shallow one as yet. I certainly hope that this is true and that we are not taking two steps forward in order to take three steps back.

Certainly some things appear to be on the mend. The Nordic economies are improving and have returned to growth. Some UK lenders are returning to the market, such as Paragon last week. Barclays, which did not receive any state aid, have not changed their lending policies in the smaller retail sector throughout the recession, which is all to the good.

However, it was announced last week that Anglo-Irish Bank needed yet further financial support from the Irish government, bringing the total package to some 27 billion euros. The support package for this single bank alone represents one fifth of Irish GDP.

Couple this with the announcement last week from Allied Irish that it has sold more than 70% of Bank Zachodni WBK to Banco Santander for a price of 2.938 billion euros, and the picture for Ireland looks bleak.
And it is not just Ireland either.

Previously the Irish were seen as some of the most stable bankers in the world, and their situation is simply an illustration of how long it will take the market to repair itself. This will not be an easy fix. Our market has always been based on utmost good faith and confidence. The tremors and shocks of the recession have shattered the status quo and it will take an enormous length of time for faith to be restored.
In the past we may have discounted the problems of non-UK banks because they were foreign and their problems did not have a direct impact on us. However, we are all now much more closely connected, so what happens in Europe and elsewhere, has a direct effect here because our economy is now global.
If we have learned nothing else from the global financial crisis it is our inter-connectedness; significant instability in one area of the world economy creates shock waves that have a rapid and devastating effect on distant economies.
Growth is not yet sustainable and there are still casualties emerging, as illustrated above. It is not all over yet. Second quarter figures show that small business lending had decreased by £269 million compared to year-on-year figures in June 2009, when the country was still in the depths of recession.

What we have said about global interconnectedness and sustainable growth may be self-evident, but what does it all have to do with brokers? We all know that we will not be returning to the good old days. We may think that things in the macro economy don’t concern us and there is nothing we can do about it anyway.

Well, that isn’t quite the whole story. While the institutions that brokers act for repair their balance sheets and make internal structural improvements, shouldn’t you as brokers be doing the same and improving your own micro-infrastructures?

While the economy remains in this sensitive phase, and while structural damage and aftershocks still claim new victims in the sector, brokers can take a leaf out of the lenders’ book and prepare themselves for recovery too.
While volume transactions are low there is little to be gained by being “busy fools” and chasing enquiries that are unlikely to convert into genuine business.

Brokers might be better employed concentrating on quality rather than volume and improving systems and deepening their understanding of future trends and strategies. I recently attended an excellent workshop on negotiating put on by Barclays and the NACFB, who should both be congratulated on a valuable event. On the day, around two dozen badges remained unclaimed on the registration desk. These brokers had apparently registered but failed to turn up, missing a great opportunity for getting to grips with strategies for more effective business and taking time to network and work “on” their businesses, rather than “in” them.
I would implore brokers to lobby the NACFB, banks and the trade media for more training of similar value.
After all, we have been through this difficult phase together. Surely, as I stated in a previous article, we should be working towards a new language of mutual engagement, which can only be brought about by continuing professional development across the sector.
As the tremors subside and the dust settles, we can survey the wreckage around us and prepare to move forward, older and wiser and, most importantly, still here!