Institutional Investment Sales Professionals – Still Facing a Whole New World

“Knowledge must continually be renewed by ceaseless effort, if it is not to be lost. It resembles a statue of marble which stands in the desert and is continually threatened with burial by the shifting sand. The hands of service must ever be at work, in order that the marble continue to lastingly shine in the sun. To these serving hands, mine shall also belong.”

~ Albert Einstein, 1950

Precipitated in large part by the Financial Crisis of 2008, the role and expertise required of the institutional sales professional have had to evolve – from benchmark-centered product sales to a consultative approach that focuses on client needs and outcomes. After the financial crisis, the smoke of scorched markets cleared to reveal a new, more complex world for fiduciaries and the managers who serve them. For many, the collective haunt of negative or single-digit returns, illiquidity when liquidity was needed most, and higher correlations across asset classes gave rise to a specter of shortfalls in meeting objectives and greater challenges in closing funding gaps.

The needs of the institutional investor vary – encompassing absolute returns, alpha, relevant diversification, liquidity, volatility reduction, income, reduced funding gaps, asset-liability matching or inflation protection. To address specific needs, institutional investors need to work with managers who are experts on capital markets worldwide, understand correlations and risk exposures, and who can offer or create solutions.

“Buckets and Boxes – Let’s Fill Them!”

Prior to the financial crisis, institutional sales professionals predominantly represented products – such as Large Cap Value, Small Cap Equity, International Equity, Fixed Income selections – to institutional investors who had mapped out fairly rigid asset allocation buckets and style boxes to be filled with defined investment products. For the most part, consultants and institutional investors knew exactly what buckets and boxes they were looking to fill, and would meet with those institutional sales professionals who had the products to fill the buckets.

Benchmarks were well defined. Relative performance to benchmarks and peers drove business. Agendas were straightforward. Managers simply let the prospect know which bucket or box they inhabited, how they fared compared to other managers in those buckets or boxes, and how they would be able to repeat their investment successes. Sales and communication processes were nearly formulaic. The Four Ps dominated: Philosophy, People, Process and Performance. If the “product” managers didn’t prove to be “good” (outperforming benchmarks and peers), they were fired and replaced by “better” product managers in those buckets and boxes.

Many managers’ products, however, did not fit in the buckets or boxes. Some, in order to grow assets, either forced their products to fit or launched products that did. Others left the confines of the traditional institutional investment world and moved into the more receptive realms of Endowments, Foundations or High Net Worth. A few pioneers revolutionized communications with the institutional investor market – identifying what they perceived to be the real needs of institutional investors, and communicating why investment offerings outside traditional buckets and boxes may be better solutions. This generally proved to be a hard sell.

“Needs and Solutions – Let’s Meet Them!”

Once the smoke of the financial crisis cleared, revealing harsh new realities, institutional investors started demanding more. Standard 60:40 asset allocations and benchmark-investing were no longer right for all investors. Almost overnight, investors and fiduciaries began shedding traditional asset allocations and style-box methods to explore what was really needed to achieve successful long-term investment outcomes.

Simultaneously, globalization led to expanding investment markets, innovation created new instruments and new markets, and the inspired vision of those with proven investment prowess brought inventive solutions to the forefront. The traditional model of selling an investment firm’s history, AUM size, products and the Four Ps became less effective. The challenge became how to position investment offerings in context of dynamic, newly appreciated needs and goals of institutional investors. Thus, the evolution of institutional sales professionals from “product sales” to “consultative sales.”

“The Hands of Service”

What does “consultative sales” mean? Many professionals were already successful at the consultative sales approach. The attributes of the evolved institutional sales professional include the following:

  • Expert investment knowledge. An MBA, CFA and/or minimum ten years in-depth investment industry experience are mandatory, as evidenced by the demand for former consultants and/or product specialists to serve as client service or sales professionals. Expertise must expand beyond a single style or asset class, and sales professionals now must demonstrate a strong grasp both of the risks institutional investors face, and of the diverse competing solutions that are effective in meeting long-term institutional investor needs. The sales professional needs to be conversant on correlations, liquidity, risk budgets, leverage, hedging, different financial instruments and leading-edge solutions. Remember, time is limited, information overwhelming and insights valued.
  • Strong probing and listening skills. A client service or sales professional must be able to ask the right open-ended questions to elicit objectives, preferences, objections, concerns, biases and opportunities. Unless specifically invited to do so, walking in and delivering a product presentation at the first meeting will limit a firm’s capability to one category in a prospect’s mind. The ability to ask the right questions at the right time, and respond appropriately, demonstrates to the client, prospect or consultant the value of working together. Strong listening skills earn respect and are also helpful in qualifying clients and prospects.
  • Empathy. A sales professional must know what actions would be most worthwhile for the buyer and when they should be offered. Attempting to sell a product prematurely or asking for the wrong actions frequently and regrettably result in no more meetings.
  • Insightful, personalized follow-through. There should always be follow-through actions. It is not enough to send a rote thank-you letter with performance information attached. It is not enough to send a social thank-you note mentioning kids, hobbies or vacation spots. What challenges or concerns are absorbing the time of the prospect or client? What would help that individual to tackle his or her challenges? A consultative approach means you are there to help. How can you help?
  • Representation of the client/prospect/consultant within the firm. In today’s highly competitive market, everyone needs to elevate their skills in communicating with clients, prospects and consultants. Consultative institutional sales professionals effectively convey and disseminate within their firms the priorities and concerns they learn from clients, consultants and prospects. Investment professionals who are well versed in the prospect’s needs and biases can advance prior conversations by bringing highly focused, relevant content to that client or prospect when they meet.

As Einstein challenged in 1950, “Knowledge must continually be renewed by ceaseless effort…” Change in our industry is continuing rapidly. It’s an exciting time to be a part of the institutional investment world, but not a time to stand still. It is a time to learn, to develop, to evolve. It is a time to keep our hands of service hard at work.

Tell us how you and your firm have evolved. Please comment below and share this article if you found it helpful. Stay engaged by following us!


Charnley & Røstvold, Inc., a preeminent marketing consulting firm to asset management firms ranging in size from start-up firms to some of the world’s largest investment firms with over $1 trillion under management. Charnley & Røstvold helps clients with competitive positioning, marketing strategies, key messages, presentation refinements, communications and sales training, consultant relations and client service programs.

Jackie Charnley, co-founder of Charnley & Røstvold, Inc., is a popular industry speaker and author. Jackie serves on the ICMA-RC Board, a not-for-profit company serving the financial needs of over one million public employees. She was also a founding board member of PAICR (Professional Association for Investment Communications Resources).

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Evolution of Institutional Investment Sales

How have institutional sales changed?

Standard 60:40 asset allocations and benchmark investing used to be the blueprint recommended for all investors. Sales and communication processes were nearly formulaic. Managers simply let the prospects and consultants know which buckets or boxes they inhabited, how they fared compared to benchmarks and other managers in those buckets or boxes, and how they would be able to repeat their investment successes. Send your quarterly performance and fill out RFPs. The “Four P’s” dominated: Philosophy, People, Process and Performance. If the “product” managers didn’t prove to be “good” (outperforming benchmarks and peers), then they would be fired, and replaced by “better” product managers in those buckets and boxes. Today, many searches are conducted without an RFP even being distributed.

Risks led to change.

With the global financial crisis showing investors what true risks were – loss of capital, illiquidity, lack of true diversification, inability to fulfill liabilities and obligations, things changed. Almost overnight, institutional investors and fiduciaries started shedding traditional asset allocations and style-box methods to explore what was really needed to achieve successful investment outcomes.

Innovation led to choices.

Simultaneously, globalization, academics and technology expanded investment markets, and innovation shaped new instruments, new approaches and new ways to allocate. The inspired and creative vision of those with investment prowess brought better solutions to the institutional market. The old model of selling an investment firm’s history, AUM size, the “Four P’s” and products became less effective.

Choices led to challenge.

The challenge became how institutional clients in context of their dynamic, newly appreciated needs and goals then determined what array of solutions best made sense for their individual plans. This new practical world of understanding the real purposes of an asset pool, of managing the real risks of an investment program and of capitalizing on ever-expanding investment opportunities requires a thoughtful approach in identifying solutions.

Challenge led to consultative selling.

Thus, institutional sales professionals were led to evolve from “product sales” to “consultative sales.” The attributes of the consultative sales professional at the minimum are:

  • Expert investment knowledge. An MBA, CFA and/or minimum ten years in-depth investment industry experience are mandatory, as evidenced by the demand for former consultants and/or product specialists to serve as client service or sales professionals. Their knowledge must expand beyond a single style or asset class, and they must demonstrate a strong grasp of the risks and the numerous competing solutions facing institutional investors. The sales professional needs to be conversant on liquidity, risk budgets, leverage, hedging, different financial instruments and leading-edge solutions. They need to be well versed on quantitative, systematic and traditional investment approaches. Understanding attribution and correlations is key. Remember, time is limited, the volume of information overwhelming and insights valued.
  • Strong probing and listening skills. A client service or sales professional must be able to ask the right open-ended questions to elicit objectives, preferences, needs, objections, concerns, biases and opportunities. Walking in and delivering a product presentation at the first meeting will corner a firm in one category in a prospect’s mind. The ability to ask the right questions at the right time, and respond appropriately, demonstrates to the client or prospect the potential value of working together. Strong listening skills earn respect. They also are helpful in qualifying the prospect.
  • Empathy. A consultative sales professional must know what actions would be most worthwhile for the buyer and when. Premature product selling or asking for the wrong actions can regrettably mean no more meetings. Sales professionals and portfolio managers must leave their egos at the door.
  • Insightful, personalized and proactive follow-through. There should always be a follow-through action. It is not enough to send a rote thank you letter attached with performance information. It is not enough to send a social thank you note mentioning kids, hobbies or vacation spots. What challenges are absorbing the time or concerns of the prospect, client or consultant? What would help them to tackle those challenges? What intellectual capital do you have at your disposal to bring to bear for the prospect, consultant or client?
  • Representation of the client/prospect/consultant within the firm. In today’s highly competitive market, everyone needs to elevate their skills in communicating with clients, prospects and consultants. Consultative institutional sales professionals effectively convey and disseminate the priorities and concerns they learn in their interactions with the market within their firms. Investment professionals who are versed in the prospect’s needs and biases can have meaningful dialogues and bring highly focused, relevant solutions to that prospect, client or consultant.

Consultative Selling Can Lead to Success.

Institutional investors want and need to work with managers who are knowledgeable on capital markets worldwide, who understand risks and the importance of time, and who can offer solutions relevant to solving specific needs. Intellectual capital is as paramount as performance. Future success depends on asset managers elevating the role and expertise of all their institutional investment sales professionals. The benefits are multiple. First and foremost, clients are better served. Second, while a consultative approach can be demanding, the intellectual rewards are immense. The profession is elevated to a higher calling.


Charnley & Røstvold, Inc., a preeminent marketing consulting firm to asset management firms ranging in size from start-up firms to some of the world’s largest investment firms with over $1 trillion under management. Charnley & Røstvold helps clients with competitive positioning, marketing strategies, key messages, presentation refinements, communications and sales training, consultant relations and client service programs.

Jackie Charnley, co-founder of Charnley & Røstvold, Inc., is a popular industry speaker and author. Jackie serves on the ICMA-RC Board, a not-for-profit company serving the financial needs of over one million public employees. She was also a founding board member of PAICR (Professional Association for Investment Communications Resources).