Apr 19, 1999 @ 12:01 am

By Jeff Nash

They traveled to the Atlanta suburb of Duluth, Ga., some with their children, some from as far away as Canada and Alaska, to see "The Show." More than 100 of them packed a television studio, while another 200 filled a nearby auditorium called "The Dream Theater" to watch the broadcast on a big screen. Yet another 50,000 watched from around the country via satellite.

"You've got to do the right thing every day - and do it from your heart," the host exhorted. With his smooth smile and commanding presence, he worked the crowd like a preacher at a revival, calling on audience members for testimony and success stories, hugging them and even shedding tears.

The crowd roared with standing ovations. Some snapped his picture. Tape recorders were scattered about the floor to capture his message.

The host is no evangelist, however. He's Joseph Plumeri, chairman and chief executive of Primerica Financial Services Inc., a subsidiary of Citigroup's Travelers Group Inc.

Mr. Plumeri's disciples are Primerica's 153,000 salespeople,

who make the pilgrimage to company headquarters by the bus load each month to witness up close Mr. Plumeri's two-hour sermon, a mix of corporate recognition and Tony Robbins-like motivation.

"Everybody has the same plumbing - we all like it when someone says we're doing a good job," Mr. Plumeri said after a recent show. "But it's an important ingredient missed by a lot of CEOs."

It's this kind of hands-on approach that has helped turn Primerica into a sales juggernaut. Mr. Plumeri shook up a door-to-door life-insurance culture when he took over Primerica in 1994 by inspiring his salespeople to see the light: Embrace the broader service of financial planning, he told them, and they could help middle-class people meet all their financial needs, selling them not just term life insurance policies but also mutual funds, stocks, annuities, mortgages, auto loans and other services. (Most of them originating from various Travelers units, by the way.)

It has worked brilliantly. In 1998, Primerica's net income was $398 million on net sales of $1.65 billion, nearly double 1994's $209 million on net sales of $1.28 billion.

Now, the 55-year-old Mr. Plumeri must do it again - in a dramatically different environment.

After Citicorp merged with Travelers Group last fall to create Citigroup, Mr. Plumeri was tapped by co-chairmen Sanford Weill and John Reed to breathe new life into Citibank as head of its 435 branches in North America. His mission: Bring to the stuffy banking giant the cross-selling expertise he developed at Primerica.

Mr. Plumeri envisions Primerica agents and Citibank bankers working side by side across the country, with Primerica sales offices inside Citibank branches. (He's already testing out part of the vision: In the New York area, Primerica agents are selling Citibank's checking accounts and credit cards to their clients.)

Transforming the traditional banking culture of Citibank may require a few miracles, however.

"The typical banker is not a good salesperson," says J. Paul Newsome, an analyst with New York investment bank and brokerage CIBC Oppenheimer Corp. "The big issue will be getting Citibank's bankers to take a sales and service focus."


Agrees Diane Glossman, an analyst with New York investment bank Lehman Brothers Holdings Inc.: "You can put in a system that motivates people to sell. It sounds easy, but the system may emphasize the wrong behavior, or the products may be irrelevant to the customer. Execution is much harder than you think."

Mr. Plumeri is unfazed by the barriers. "I'm going to try to change the way banking is done in this country," he says.

Already, he has completed a 13-stop road show around the country to "roll out the vision" to Citibank's employees, describing the need for new compensation programs that will be based on sales performance instead of standard salaries and new licensing drives that will turn thousands of employees into registered representatives selling stocks, mutual funds, annuities and insurance (InvestmentNews, Feb. 22, 1999, and Dec. 7, 1998).

"Our clients don't know much about money - it doesn't come with an instruction book," Mr. Plumeri says. "And banks have a responsibility to help people do more than open checking accounts."

If banking can be turned around, Mr. Plumeri is widely considered the right man for the job - and Citibank the right place. It had nearly $40 billion in deposits in 1998, sold $793 million of its own long-term mutual funds and increased its share of the bank fund market to 1.27% from 1.01%, according to Financial Research Corp. of Boston.

"Citibank is already highly successful (for a bank) at selling brokerage services and annuities," observes Kenneth Kehrer, a consultant in Princeton, N.J., adding tartly that "Plumeri coming in is kind of like bringing coals to Newcastle."

A big, noticeable victory at Citibank, however, could make Mr. Plumeri a leading contender to run all of Citigroup when Mr. Weill, 65, and Mr. Reed, 60, step down.

"Joe has made a habit of success," says Jeffrey B. Lane, chief administrative officer for New York money manager Neuberger Berman LLC, who worked with Mr. Plumeri for years at Travelers and predecessor companies.

"He has been the most innovative person in financial services I know of," Mr. Lane says. "Whatever he touches turns to gold."

Adds analyst Mr. Newsome: "He's not the spit-and-polish executive many people expected. He's rough on the edges. But Citibank knows the bank as an institution is in trouble - it can't get away anymore with passive selling - and Plumeri has all the passion to throw a glass of cold water on the bank."

It won't be the first time Mr. Plumeri has had to shake things up. When he took over Primerica, he made the "financial needs analysis" - a financial plan - the centerpiece of the insurance agents' sales practice.

"People thought I was a little crazy," recalls Mr. Plumeri. "But I said this is the way we're going to conduct business because this is the way to find out what peoples' needs are."

Primerica agents, many of whom work part time (and are supervised by full-timers who are themselves independent contractors) have excelled at selling Travelers products. Since 1995, sales of mutual funds have risen 82%, sales of variable annuities have increased 2,315%, sales of securities are up 121% and mortgages and consumer loans have increased 141%.

"In this type of a business, with part-timers, leadership is everything," says John Addison, president of Primerica. "You're basically building a volunteer army. Joe's vision was perfect for Primerica, and he got people to buy into that vision and execute that vision, which is rare."

Mr. Plumeri's career on Wall Street spans more than 30 years, beginning in 1966 as a broker with Carter Berlind & Weill, the New York firm of Mr. Weill and predecessor to Shearson Lehman Brothers and Salomon Smith Barney.

He became one of Mr. Weill's top lieutenants and rose to become president of Smith Barney when it acquired Shearson in 1993. But he was replaced by Jamie Dimon a year later after his gung-ho style failed to move Smith Barney executives. Almost immediately, Mr. Weill assigned him to Primerica.

"Sandy has been my role model," Mr. Plumeri says. "He's the shrewdest, smartest businessman I've ever seen, and he's also the sweetest."

Aside from the obvious political skills, Mr. Plumeri attributes his rise to hard work and attention to detail.

"I am a fanatic on knowing everything there is to know about the business; I have meetings with every major department of this company every week, and I go into gory detail," he says. "This is what people don't see. They come to a show and listen to my speeches. They see I'm evangelical, passionate, et cetera. I wish it were that easy to build a company by just giving good speeches."

Still, Mr. Plumeri stresses the human touch when it comes to managing. "Where is it written that because you're a CEO, you don't have any soul or heart or feelings?"

With his new Citibank job, in addition to his Primerica duties, Mr. Plumeri has time for little else, commuting between Atlanta and New York. "I have two speeds -warp and sleep," he says.

Citibank employees had better catch up. He already has adapted a Primerica-style financial plan for employees there. More important, he has created a three-level career path that emphasizes sales and commissions.


Customer service representatives are now "financial associates" who receive bonuses for their referrals on investment and insurance sales as well as on actual sales of the bank's in-house products.

Personal bankers, once licensed, are now "financial analysts" who receive 20% of the commissions on sales of securities, insurance and mortgages and a bonus on bank product sales.

And with even more training and licensing, Citibank's former "investment consultants" are now "financial executives" who receive 80% commissions on securities and insurance sales.

Even with the system laid out, the bankers may not take to Mr. Plumeri's vision with the same fervor that Primerica agents have.

"The Citibanking operation in the U.S. has not experienced terribly robust revenue growth," says analyst Ms. Glossman. "If Joe Plumeri can even partially transform the culture, it would be an incredible improvement."

Mr. Plumeri says there's no other way around it.

"Right now banks are destinations, for the most part - you go in for a particular reason and you walk out," he says. "It's got to change."

Take a clue from the television soundstage in Duluth. On the right side of the set is a backdrop with the Primerica logo. On the left is a new addition: the Citibank logo.


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