Healthy outlook
FOR FUTURE POLICIES
12
customer focus
Our new Health Care Policy is an organic outgrowth of our essential orientation
as a cooperative bank; our new commitment is making a contribution towards
the improvement of health throughout the world.To the extent that we can
continue to deliver new and better financial solutions to the varied challenges
confronting health care providers worldwide. We can also free up the corporate
minds of those providers and insure that their energies can be uninterruptedly
focused on providing the services that they understand best.
The new policy, cleared last month,
mandates a shift away from traditional
banking, where the stress is laid on selling
solvency-intensive credit products, and
towards a broader, more service- and
solutions-oriented approach to financial
consultancy. The new policy is founded on
a simple starting proposition; namely,
wherever greater knowledge can be
mobilized, there can also be more accurate
risk assessment, more innovative
solutions, and thus enhanced profit
margins. Using this approach, the ROSadd
(a figure that indicates cliënt profitability
and return on solvency) in this sector is
budgeted to expand threefold to 6 percent
by decades' end.
PROFOUND SHIFTS
Health care is of course a large, rapidly
growing, and intensively evolving market.
Some 10 percent of the industrialized
world's total GDP is spent on health and
demographic trends point towards further,
considerable growth. In the developing
world, higher national incomes and, for
many, more comfortable living standards,
are bringing new challenges and
opportunities to medical practitioners.
Throughout the world, regulatory and
technical developments, plus evolving
consumer attitudes, are combining to
produce profound shifts in how health care
is delivered, who makes the decisions, and
by what means the bills are ultimately paid.
ASSURING SURVIVAL
By providing expert financial solutions,
we can help assure the survival and
prosperity of our clients throughout this
industry. Success must be measured not
merely in terms of our own net profit but
also in terms of delivered customer value,
and in terms of the enduring strength of
our cliënt relationships. For those
companies that become 'focus customers,'
a partnership with Rabobank must make
a real difference in terms of their own
bottom line. To achieve these levels of
service and profitability, the aggregated
Health Care activities within the bank will
henceforth be viewed as comprising a
virtual company within the framework of
Rabobank International overall. The
company is encouraged to develop its own
vision, strategy and culture - consistent
with the goals of the bank itself.
CLOSING GLOBAL DEALS
At present, of course, we are already
deeply engaged in the Health Care market,
with dedicated teams not only in the
United States (a one trillion dollar market
that accounts for two-thirds of private
world health care spending), but also in
the fast evolving markets of Europe, Latin
America and Asia as well. This
commitment of human resources has
generated a number of important deals of
late. Among them has been a project
finance, valued at some USD 17 million,
for construction of the first large-scale
'We are going to have to make some
profound changes in our attitude and
behaviour.
private hospital with foreign investors in
China. Also this year, we arranged a USD a
60 million syndicated loan for a Chilean
pharmaceuticals group on the US market.
We helped settle a leveraged buyout of a
diagnostics laboratory in Germany as well
as the acquisition finance of GBP 27
million for a hospital chain in the UK.
Also in the UK, we are part of a
consortium to build a privately financed,
GBP 115 million hospital.
BUILDING RELATIONSHIPS
These deals and others stand as clear signs
of our engagement and success in the
market to date. However, the overall
tendency has been to focus on marketing
loans and credit facilities - which make
high demands on our solvency. With
constrained resources, and given more
stringent solvency requirements, the bank
has to limit itself not only to specific
market areas in which we can create
distinctive customer value, but also to
specific activities, namely a more
solutions-oriented approach to cliënt
relations. What this implies is nothing less
than a wholesale transformation in the
way we think and work. Relationship
managers have essentially concentrated on
selling credit, hitherto - and in a sales
environment the greatest flow from an
outgoing and ebullient approach.
LEARNING TO LISTEN
Henceforth, relationship managers will
have to act more like financial consultants.
In the world of consultancy, it is the ability
to listen that generates enduring trust.
These two roles - that of the salesman as a
product provider and that of the consultant
as a solutions organizer - are diametrically^
opposed,' rentarks Arnold Kuijpers, Health
5 Care business manager. 'We are going to
o have to make some profound changes in
our attitude and behaviour.' To help speed
