Dominique Signora (E90) was recently appointed VP Managing Director of Territories for RCI Bank and Services. A chance to look back on a 25-year career at the Renault Group subsidiary.
ESSEC Alumni: What does your new job involve?
Dominique Signora: I have operational responsibility for our 35 subsidiaries in six regions: France, Europe outside France, Eurasia, the Americas, Asia and AMI (Africa, the Middle East and India). My mission is to establish a growth strategy for both financing and services that best meet the needs of customers of the Renault-Nissan Alliance brands (Renault, Renault Samsung Motors, Dacia, Nissan, Infiniti and Datsun).
EA: Why does the Renault Group have a banking subsidiary?
D. Signora: In 1924, Louis Renault set up DIAC, the Diffusion Industrielle et Automobile par le Crédit company, to facilitate access to mobility for the French, and make cars accessible to all. Over time our activities have diversified into services including car insurance and collecting deposits, but this founding commitment is still in our DNA.
Our ambition is to make using a car easier for all private and business customers of the Alliance brands by creating innovative, connected, personalized offers for them. We suggest the financing and services best suited to their needs, depending on whether they buy new or second-hand vehicles.
Nowadays most car manufacturers have a financial subsidiary simply because almost all over the world buying a car is the second most expensive consumer purchase after buying a home. Most customers buy their cars using financing. There are regional specificities worth noting: in Europe, leasing finance (LOB or Lease with Option to Buy and LTL or Long-Term Lease) is developing quickly. Very often this includes offers packaged with insurance and vehicle maintenance, giving customers complete visibility of the cost of using a vehicle. On the other hand, in emerging markets customers still consider a vehicle as an investment, choosing financing so they can buy the vehicle outright.
EA: Since 2012, you have extended your deposit collection activities to private individuals…
D. Signora: Our savings product offering is now available in four European countries: France, Germany, Austria and the United Kingdom. The funds collected are reinvested in our car loan activity. In fact, collecting deposits provides powerful refinancing leverage. The net sum of deposits collected represented 32% of our loans at the end of December 2015. RCI Bank and Services also lends its support to the brand networks by financing their stocks (new and second-hand vehicles and spare parts) as well as their short-term cash needs.
EA: RCI Bank and Services achieved record sales results in 2015. What are the key factors of this success?
D. Signora: Above all, performance has been sustained by the strong growth of the European car market, but also by the dynamism of the Alliance’s brands in most of the markets we operate in. The increase in new financing proposals (23.9% in 2015) is also explained by the attractiveness of the commercial offerings created with the brands. At the end of 2015, RCI Banque’s average outstanding loans stood at €28.4 billion – the highest level of loans we have ever achieved.
We are still rolling out new services and developing internationally. The strong growth in savings collected has reinforced the competitiveness of RCI Banque’s refinancing. Services activity – a pillar of our strategy – contributes to customer satisfaction and to Alliance brand loyalty. It also provides important leverage for profitability. Its development is based on two core areas: diversification of the product range, and international expansion. The strategy is a success, as the volume of new service agreements has leapt by 31.5% in a year to reach almost 2.9 million services (of which more than 60% are linked to vehicles).
EA: At the beginning of 2016, RCI Banque became RCI Bank and Services. What does this change mean?
D. Signora: The new commercial identity conveys our international dimension, as well as our ambition to develop a full range of services to offer ever more innovative and user-friendly auto-mobility solutions - and enrich our customers’ experience.
EA: How do you advertise in contrast to traditional banks?
D. Signora: We define our products to meet the specific customer expectations of each of the Alliance brands.
EA: Who are your competitors? How do you manage to stand out from them?
D. Signora: We position ourselves against traditional banking and financing establishments by seeking to respond to the specific needs of Alliance brand customers. Our products are created with the brands’ marketing managers, which means we can offer packages and leasing with option to buy that stand out from the standard products on the market. They are also communicated strongly by each of the brands and systematically offered by Renault and Nissan distribution network dealers.
EA: RCI Bank and Services recently launched the RCI Mobility service. What’s the objective?
D. Signora: The subsidiary is 100% dedicated to developing B2B car sharing services and other services associated with cars. In particular, the business is intended to become an innovation center for auto-mobility.
EA: The car market has been through some difficult years. How has that affected the performance of RCI Bank and Services?
D. Signora: RCI Banque’s profits consist of interest received from financing our customers. The average term of financing is 40 months. That means the profit for a given year consists of interest acquired on financing given before that year, and interest on financing provided during that year. This particular profit structure means profits are less sensitive to the economic context. On the other hand, the economic crisis can have a negative impact on the cost of our debts on the balance sheet and on our customers’ payment behavior. It also affects the cost of refinancing new loans. That’s why, since 2012, RCI has developed a deposit collection strategy to diversify its sources of refinancing.
EA: How can the recent upturn be explained? Is it here to stay?
D. Signora: The car market remains cyclical, linked to the phases of the economy and consumption, as well as product renewal. Being present on several continents means we can cushion these effects. For example, during the crisis in Europe our sales were developing in Brazil. And when the Russian and Brazilian markets were showing a net decline, the European market saw a strong upturn that the Alliance brands could capitalize on thanks to a very ambitious product plan.
EA: We hear about self-driving cars, electric cars, flying cars... What does the future hold for cars? How are you preparing for it?
D. Signora: The electric car is already here. We support Nissan and Renault in financing their 100% electric models, such as the Zoé and the Leaf. The self-driving car will definitely be the next automobile revolution - and we have to anticipate it.
We are currently undergoing a transformation in our relationship with cars, which are becoming shared assets. From now on, at least for the moment in the big cities, being an owner is no longer going to be priority for many users, who are happy to pay for use in multiple formats: with a driver, shared between several people or paying by the minute or by the day. Car sharing, carpooling, private leasing, transport planning - these new mobility models are a big challenge to the manufacturers’ traditional economic model based on vehicle sales. We have to explore new ways of providing safe, practical and attractive mobility services.
EA: Let’s review your career, which you have spent entirely with RCI Banque. Can you explain why?
D. Signora: I really appreciate the business, its mindset and its values. And it hasn’t prevented me from having a highly diversified professional career, as I’ve had the chance to work for RCI Banque in various countries as well as directly for Nissan, one of the Alliance brands.
EA: Would a career like that still be possible today, when job mobility is so important?
D. Signora: I think this type of career is still possible, although it’s probably less relevant to most young graduates who prefer to diversify their experience in different groups and business sectors. The important thing is to be able to change position regularly, even if you stay in the same company. Doing that internationally is a more important decision because the whole family is directly involved, but it means everyone can participate.
EA: You have worked in Europe, in Latin America and in Asia. Which cultural differences have made the greatest impression on you?
D. Signora: The way people work varies from one country to another. You need to make an effort to understand and adapt quickly. Advice from other foreigners and sharing experiences can help a lot at the beginning. What I remember from my experiences more than anything, is that you cannot generalize about continents. Asia is like Europe in that each country is unique. The Thai working culture, for example, is as different from Korean culture as it is from French culture.
Another issue is language. While it’s relatively easy to communicate in Europe or in America, the barrier is more difficult to cross in Asia. Several years living abroad are not enough to master an Asian language for everyday life: you are stuck at a basic level. For example, Korean characters are vocal and therefore easy to learn; you can learn to read quickly. However, understanding what you hear is not so easy. Like Japanese, Korean is rich, with a complex grammar quite close to German – declensions, verbs placed at the end of the sentence, and so on.
EA: How do you balance an international career with your personal life?
D. Signora: The whole family has to take part in the decision and get something out of it. I owe a lot to my wife for the career I’ve had. It’s very enriching for my children because they are permanently discovering and are open to a range of cultural references. People now talk about “Third Culture Kids”.
EA: Do you have to travel the world nowadays to be able to get a managing director’s job?
D. Signora: No, but an international career is excellent training. It helps you better understand the diversity of markets, and to contrast approaches that are sometimes too conceptual, with operational realities. The diversity of these experiences helps you make decisions.
EA: You have managed teams all over the world. Do you have management secrets or methods?
D. Signora: In all countries you need to be able to motivate teams, which means understanding how individuals react. There are always local and cultural specificities, but overall people like to understand the ultimate goal and where the business is going. First of all you need to work on a strategy and clearly communicate the objectives, point the way forward and get employees on board by involving them.
Knowing how to listen is also a great quality. Even if I don’t necessarily follow the advice I am given, I always ask the opinions of others before making a decision. And you need to be careful about mutual understanding. In Korea, for example, your teams will do what you have asked them very quickly and carry it out efficiently. This means it’s a good idea to check carefully that they have understood exactly where you wanted to go. Thai culture is more iterative, so you mustn’t be shocked to see a decision made one day being called into question the next. In Brazil, the culture allows for plenty of creativity and constant innovation. There you’re more the conductor of the orchestra.
EA: Finally, what are your memories of ESSEC?
D. Signora: I have very happy memories. I learned things that are still useful to me today, and I met friends I still have today.
EA: Has going to ESSEC helped you in your career?
D. Signora: A lot. ESSEC has given me a solid theoretical base strengthened by practical application. My experience has helped developed these. Studying at a business school also gives you an overall view of all types of job, which you need to maintain to understand each business sector.
EA: Has the ESSEC Alumni network been useful to you?
D. Signora: Yes, if only for maintaining contacts and getting to know the young graduates who might be tempted by the business world.
EA: What advice would you give to young graduates?
D. Signora: They’re lucky to have plenty of opportunities ahead of them. They are not yet specialized in a profession or a sector. Their first career choices will be key, although it is always possible to change direction. Those choices will determine your motivation and whether you enjoy your work. That’s what I always say to interns in my teams, whichever country they come from.