What to Look For in a New Salesperson

Wednesday, July 25th, 2012

by Matthew Asser, The Covenant Group

For a finan­cial ser­vices orga­ni­za­tion to be suc­cess­ful, its sales­peo­ple need to focus not only on hit­ting sales tar­gets, but also on the rela­tion­ships they cre­ate through those inter­ac­tions and on build­ing client cap­i­tal. They need to nur­ture the client con­nec­tion in addi­tion to dri­ving cur­rent and future sales.

A finan­cial ser­vices pro­fes­sional may under­stand this as he or she works closely with a select group of clients. Yet other employ­ees in your orga­ni­za­tion may not under­stand that value. That is why, when you decide that it is time to del­e­gate some of the sales tasks to some­one else, there are a few char­ac­ter­is­tics you should look for in a new salesperson.

Cus­tomer ser­vice, sales and mar­ket­ing are inter­twined. Because of that, a busi­ness needs to ensure it is hir­ing peo­ple who know the value of a per­sonal rela­tion­ship and who are not sim­ply try­ing to rush through as many sales meet­ings as pos­si­ble. While hav­ing com­pet­i­tive, dri­ven pro­fes­sion­als is essen­tial to build­ing your busi­ness, their moti­va­tion should not come at the cost of cre­at­ing mean­ing­ful con­nec­tions with clients.

Any sales­per­son you con­sider hir­ing should also believe whole­heart­edly in the com­pany, not just in mov­ing prod­uct and acquir­ing a long list of clients. Are they focused on their own inter­ests or on those of the clients? Do they want to pro­vide value-added ser­vice not only to improve their pay­checks and qual­ity of liv­ing, but also to make the lives of those they serve more secure? These are the kinds of fac­tors that should push a good finan­cial ser­vices pro­fes­sional to get up in the morn­ing, not sim­ply the desire to make money.

On the point of mar­ket­ing, you should also seek to build a team of “brand ambas­sadors,” employ­ees who pos­i­tively rep­re­sent your busi­ness and who spread the words of your mis­sion and pro­fes­sional val­ues to every client. In a more per­son­al­ized sell­ing envi­ron­ment, demon­strat­ing enthu­si­asm for the brand can improve loy­alty and show a prospect why the prod­uct is worthwhile.

To pro­vide the extra value to con­sumers and engen­der their trust, sales­peo­ple need to be the experts on the prod­ucts they sell and pro­vide knowl­edge and insights. By offer­ing extra infor­ma­tion to your clients, show­ing enthu­si­asm for the prod­ucts you sell and con­tin­u­ally pro­vid­ing ser­vice, your sales­peo­ple can evolve into trusted advisors.

Matthew Asser has spent the last few decades gain­ing exper­tise in how finan­cial ser­vices firms can opti­mize their oper­a­tions, mar­ket­ing, new prod­ucts, busi­ness devel­op­ment and client rela­tion­ship man­age­ment prac­tices. He’s well-versed in the chal­lenges that an entre­pre­neur may strug­gle with, and as a Senior Coach and Facil­i­ta­tor, helps clients achieve busi­ness change through The Covenant Group’s exten­sive finan­cial advi­sor train­ing programs.

Fol­low The Covenant Group

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Tags: Ambassadors, Asser, Covenant Group, Customer Service Sales, Driven Professionals, Financial Services Organization, Future Sales, Meaningful Connections, Motivation, Nbsp, Paychecks, Personal Relationship, Professional Values, Sales And Marketing, Sales Meetings, Sales Targets, Salespeople, Salesperson, Select Group, Value Added Service
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Seven Tips to Gain Control of Your Day

Wednesday, April 11th, 2012

Last fall, I began con­tribut­ing to Hors­es­mouth, the top Amer­i­can web­site for advi­sors on prac­tice man­age­ment issues.

At the end of the year, I was delighted to have three of my arti­cles appear in their Top Ten for 2009, includ­ing the num­ber one arti­cle overall!

Here are the three arti­cles that ranked in Horsesmouth’s top ten for last year.

#1  The end of prospect­ing as you know it http://​www​.strate​gicim​per​a​tives​.ca/​b​l​o​g​/​?​p​=​150

#5 10 tips for max­i­mum moti­va­tion http://​www​.strate​gicim​per​a​tives​.ca/​b​l​o​g​/​?​p​=​129

#10 Tap­ping into today’s #1 client concern

http://​www​.cli​entin​sights​.ca/​a​r​t​i​c​l​e​/​t​a​p​p​i​n​g​-​i​n​t​o​-​t​o​d​a​y​-​s​-​1​-​c​l​i​e​n​t​-​c​o​n​c​ern

Another of the top ten was by Steve San­duski of con­sult­ing firm PEAK, on seven tips to make your day more pro­duc­tive. Below are the tips, repro­duced with Steve’s per­mis­sion. To see more arti­cles and to sign up for their free newslet­ter, go to www​.suc​ceed​with​peak​.com .

Tip one: Stop com­plain­ing about not hav­ing enough time

We all have the same num­ber of hours to work with – what seper­ates top advi­sors is what they do with those hours.

Tip Two: Focus on out­comes you love

You need to love the out­come of what you’re attempt­ing to get through the pain that you might have to go through to actu­ally accom­plish it.

Take time block­ing. You know that it’s effec­tive and can help you be more pro­duc­tive. But if you’re not doing it, maybe you’re say­ing, “Well, I just like to have the flex­i­bil­ity in my sched­ule so that if I need to go have lunch with a buddy, I can do that. I don’t have to stick to this fixed time-block sched­ule that I have in front of me.”

So what are you really say­ing? Maybe you value flex­i­bil­ity more than the higher pro­duc­tiv­ity from stick­ing to a struc­tured schedule.

Tip Three: Know what you value.

Before you can be pro­duc­tive, you must dis­cover the one goal that you value the most.

Once you fig­ure out what you value you can align all your activ­i­ties on a daily basis, weekly basis, and monthly basis around the objec­tive of accom­plish­ing what that one thing is

For Tips Four thru Seven, con­tinue here.

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Tags: Blog, Consulting Firm, Control, Daily Basis, Free Newsletter, Love, Lunch, Maximum, Motivation, Objective, Practice Management Issues, Productivity, Sanduski, Tapping, Time Block, Value Flexibility
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Seven Tips to Gain Control of Your Day

Wednesday, December 7th, 2011

Last fall, I began con­tribut­ing to Hors­es­mouth, the top Amer­i­can web­site for advi­sors on prac­tice man­age­ment issues.

At the end of the year, I was delighted to have three of my arti­cles appear in their Top Ten for 2009, includ­ing the num­ber one arti­cle overall!

Here are the three arti­cles that ranked in Horsesmouth’s top ten for last year.

#1  The end of prospect­ing as you know it http://​www​.strate​gicim​per​a​tives​.ca/​b​l​o​g​/​?​p​=​150
#5 10 tips for max­i­mum moti­va­tion http://​www​.strate​gicim​per​a​tives​.ca/​b​l​o​g​/​?​p​=​129
#10 Tap­ping into today’s #1 client con­cern http://​www​.cli​entin​sights​.ca/​a​r​t​i​c​l​e​/​t​a​p​p​i​n​g​-​i​n​t​o​-​t​o​d​a​y​-​s​-​1​-​c​l​i​e​n​t​-​c​o​n​c​ern

Another of the top ten was by Steve San­duski of con­sult­ing firm PEAK, on seven tips to make your day more pro­duc­tive. Below are the tips, repro­duced with Steve’s per­mis­sion. To see more arti­cles and to sign up for their free newslet­ter, go to www​.suc​ceed​with​peak​.com .

Tip one: Stop com­plain­ing about not hav­ing enough time

We all have the same num­ber of hours to work with – what seper­ates top advi­sors is what they do with those hours.

Tip Two: Focus on out­comes you love

You need to love the out­come of what you’re attempt­ing to get through the pain that you might have to go through to actu­ally accom­plish it.

Take time block­ing. You know that it’s effec­tive and can help you be more pro­duc­tive. But if you’re not doing it, maybe you’re say­ing, “Well, I just like to have the flex­i­bil­ity in my sched­ule so that if I need to go have lunch with a buddy, I can do that. I don’t have to stick to this fixed time-block sched­ule that I have in front of me.”

So what are you really say­ing? Maybe you value flex­i­bil­ity more than the higher pro­duc­tiv­ity from stick­ing to a struc­tured schedule.

Tip Three: Know what you value.

Before you can be pro­duc­tive, you must dis­cover the one goal that you value the most.

Once you fig­ure out what you value you can align all your activ­i­ties on a daily basis, weekly basis, and monthly basis around the objec­tive of accom­plish­ing what that one thing is

Tip four:  Spend time on the right activities.

Steve’s firm did a sur­vey of finan­cial advi­sors some time ago. They asked them to track their time over a one– or two-week period, to see if there was any dif­fer­ence between how $100,000 pro­duc­ers spent their time and how pro­duc­ers doing a mil­lion dol­lars or more spent their time.

They found a few activ­i­ties accounted for about 75% of the typ­i­cal day or week of a million-dollar-plus producer:

• Review­ing client goals and objectives
• Man­ag­ing assets and research
• Com­mu­ni­cat­ing with A+ clients
• Stay­ing phys­i­cally fit
• Cul­ti­vat­ing A+ referrals
• Deep­en­ing A+ and A relationships
• Devel­op­ing cen­ters of influence
• Deliv­er­ing A+ and A client solutions
• Meet­ing with staff

These advi­sors didn’t spend time doing things that could eas­ily be han­dled by some­one else in the office or out­sourced, nor did they spend time work­ing with B and C level clients or B and C level prospects.

Instead, they had an asso­ciate wealth advi­sor in the office who was able to work with these less-complicated accounts. These top pro­duc­ers were very focused on A+ prospects and A or A+ clients.

Tip five: Reduce stress and workload.

Suc­cess­ful advi­sors reduce stress in their lives by focus­ing on the most impor­tant activ­i­ties that drive their busi­ness. Most advi­sors have to do lists …. what many need are “not to do ” lists that help say no to the things that aren’t impor­tant and yes to things that are important.

Part of reduc­ing stress also involves not tak­ing on more than you can han­dle. So if you add some­thing to your life (a new rou­tine or oppor­tu­nity), you’re going to have to drop some­thing else out of your life.

Tip six:  Uni­task, don’t multitask.

To achieve max­i­mum pro­duc­tiv­ity, you need to focus on one task at a time and give your­self a time limit to accom­plish it.

It’s so easy to get dis­tracted, but you get the best result when you’re focused. Time block­ing is a pow­er­ful way to focus our atten­tion on one thing at a time, whether that’s check­ing e-mail, return­ing calls, mak­ing out­bound calls or vis­it­ing with clients. We all love to mul­ti­task, but to oper­ate at peak pro­duc­tiv­ity we need to stop mul­ti­task­ing and start uni­task­ing. When you’re work­ing on some­thing impor­tant, you’ve got to focus on that

Tip seven: Iden­tify six key things you need to do every day.

Each day before you leave the office, write down six things that you have to accom­plish the next day.

At the very bot­tom of the page write, “The Vital One.” This is a big thing you have to do this week, per­haps putting together a pro­posal for a prospect, or plan­ning a prospect­ing event.

When you get into the office, start on your No. 1 item, and fin­ish it or get as far as you can go, scratch through it, and move on

Finally, remem­ber this quote from Peter Drucker: “Effi­ciency is doing things right, while effec­tive­ness is doing the right things.”

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Tags: Blog, Consulting Firm, Control, Daily Basis, Free Newsletter, Love, Lunch, Maximum, Motivation, Objective, Practice Management Issues, Productivity, Sanduski, Tapping, Time Block, Value Flexibility
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Two Surprising Questions That REALLY Motivate Your Assistant

Wednesday, October 5th, 2011

Two sur­pris­ing ques­tions that REALLY moti­vate your assistant

Imag­ine that a genie gave you three wishes to move your busi­ness forward.

If you’re like most advi­sors, on your list would be mar­kets that only go up, com­pli­ance depart­ments that only say “yes” and mil­lion dol­lar clients who always do what they’re told and never quib­ble about fees.

Another request high on the list of many advi­sors would be a cheer­ful, moti­vated, effi­cient team, united in the com­mon goal of help­ing you move your busi­ness forward.

And while you have no con­trol over mar­kets or com­pli­ance depart­ments and lim­ited con­trol over client behav­iour, you have a great deal of con­trol over how well your team operates.

The suc­cess for­mula for effec­tive teams

Research and expe­ri­ence show that there is a five part for­mula for effec­tive teams:

1. The right people:

Start with staff with the right skillset and attitude

2. The right roles:

Ensure you’re using those skills and atti­tudes effectivel

3. The right incentives:

A pay struc­ture that treats staff fairly and has the right mix between fixed and vari­able compensation

4. The right environment:

Research by psy­chol­o­gist Fred­er­ick Herzberg going back to the 1960s shows that while poor pay is a de –moti­va­tor, for most peo­ple money alone won’t sus­tain motivation.

Rather, peo­ple are moti­vated by work that is ful­fill­ing; by a sense of progress in what they’re doing, by hav­ing con­trol over their work, by being rec­og­nized and acknowl­edged and by oppor­tu­ni­ties for growth and advancement

5. The right leadership:

Pro­vide clear direc­tion and com­mu­ni­ca­tion and as leader com­mand respect for your abil­ity and integrity.

Cre­at­ing engaged employees

Let’s assume you have the right peo­ple in the right roles with the right incen­tives. What now?

The good news; you’re 60% of the way down the path to hav­ing an effec­tive, well– func­tion­ing team.

The bad news; you still have 40% to go.

The REALLY good news; you have a sub­stan­tial amount of con­trol over the remain­ing steps. How you lead and com­mu­ni­cate with your team is 100% in your con­trol. You can influ­ence many aspects of the envi­ron­ment that dri­ves sat­is­fac­tion and effectiveness.

Here’s what you need to do.

Whether you have one assis­tant or a team of ten, start by clearly com­mu­ni­cat­ing the mid-term goals for your busi­ness and your spe­cific objec­tives for 2012. Share those objec­tives in as spe­cific and con­crete terms as possible.

Then say to each mem­ber of your team:

“I’d like to sched­ule a one-on-one meet­ing next week to talk about two things.”

“First, given next year’s goals for the busi­ness, I’d like your views on what your top three pri­or­i­ties should be to help achieve those goals.”

“Sec­ond, I want to hear what I can do to help you make those pri­or­i­ties hap­pen. It can relate to our work envi­ron­ment, how you spend your day, how we oper­ate or how I man­age my time. I am open to hear­ing your views on any­thing I can do to help you oper­ate more effec­tively: And just to be clear, noth­ing you say will hurt my feel­ings, my goal is to remove all the obsta­cles I can to allow every­one to do a bet­ter job.”

There are a cou­ple of keys to mak­ing these con­ver­sa­tions productive:

First, giv­ing your staff time to think through their response; that’s why you sched­ule the meet­ing a week out.

And sec­ond, being truly open to what your team tells you about what you can do to help them oper­ate more effec­tively. Pro­vid­ing that you act on what you hear, those con­ver­sa­tions could be crit­i­cal in improv­ing your team’s moti­va­tion and per­for­mance in 2012 and beyond.

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Tags: 1960s, Attitude, Attitudes, Bad News, Command Respect, Common Goal, Compliance Departments, Effective Teams, Genie, Incentives, Integrity, Limited Control, Motivation, Motivator, Pay Structure, Psychologist, Skillset, Success Formula, Three Wishes, Variable Compensation
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From One Generation to the Next

Wednesday, September 14th, 2011

The fol­low­ing is based on one of Norm Trainor’s clients, Norm Carroll.

I first met Norm Car­roll in May, 2002. I was launch­ing our Prac­tice Devel­op­ment Pro­gram spon­sored by Great West Life. Norm was one of 32 President’s Coun­cil qual­i­fiers who signed up for the pro­gram. In our ini­tial inter­view, Norm explained that his pri­mary moti­va­tion was to keep his pro­duc­tion level in the top ten of the President’s Coun­cil. Like most top advi­sors, Norm is very com­pet­i­tive. How­ever, main­tain­ing a top ten posi­tion was becom­ing more dif­fi­cult. Norm was the only pro­ducer in his office. The chal­lenge of sell­ing, man­ag­ing staff and run­ning his busi­ness was becom­ing overwhelming.

As Norm would tell you, it took a while in the Covenant pro­gram to grasp the com­plex­i­ties of build­ing his busi­ness. After a num­ber of years, it all came together. Norm learned how to work more effec­tively with his employ­ees. This led to increased pro­duc­tion that allowed him to hire another pro­ducer. By free­ing him­self up to do what he does best, the busi­ness just took off. As he learned to bet­ter man­age him­self and his busi­ness, he was freed up to focus on what was really important.

A new and more pow­er­ful pur­pose emerged in his work and busi­ness. His son, Neil, came into the busi­ness and suc­ces­sion became the focus. Prior to Neil join­ing, Norm had restruc­tured the prac­tice. Ini­tially, Norm had a spe­cial­ist and two assis­tants. One of the assis­tants wanted to get into sales. Over the last few years, she has become an impor­tant con­trib­u­tor to the growth of the busi­ness. This gave Norm expe­ri­ence in man­ag­ing a pro­ducer and pre­pared him to work with his son. Norm wanted Neil to suc­ceed on his own merit. Neil started on com­mis­sion and has con­tributed from day one to the prof­itabil­ity of the firm.

When a son or daugh­ter enters the busi­ness, there is an over­whelm­ing sense of pride. It val­i­dates your work and your life. Neil learned at the din­ing room table about the busi­ness. When Neil joined, it was a state­ment that he saw the value of what Norm was doing.

Norm has built a strong team that sup­ports and chal­lenges each other to grow. They feed off each other. The involve­ment of oth­ers has breathed new life into the busi­ness. The com­bi­na­tion of diverse lev­els of expe­ri­ence has taken the busi­ness to new lev­els. It is allow­ing every­one in the busi­ness to visu­al­ize a much big­ger future. It is an excit­ing place to work.

The firm now has a Busi­ness Plan to tran­si­tion the com­pany to the next gen­er­a­tion. Norm has moved from suc­cess to sig­nif­i­cance in his work and to suc­ces­sion in his business.

Norm Trainor is the founder of The Covenant Group, a com­pany spe­cial­iz­ing in prac­tice devel­op­ment for advi­sors. For fur­ther infor­ma­tion, visit his Web site at www​.covenant​group​.com.

Fol­low The Covenant Group at:

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Tags: Complexities, Contributor, Covenant, Dining Room Table, Dining Table, Focus, Initial Interview, Led, Managing Staff, Motivation, Norm Trainor, Overwhelming Sense, Pride, Profitability, S Council, Succession
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The Most Important Word in Business

Wednesday, August 31st, 2011

When I give a pre­sen­ta­tion, I often start out by ask­ing the audi­ence the fol­low­ing ques­tion: “If you had to choose one word that is crit­i­cal to the suc­cess of a busi­ness, what would that word be?” Typ­i­cally, peo­ple will respond with words such as “moti­va­tion”, “plan­ning” or “inno­va­tion”. Obvi­ously, all of these words are impor­tant ele­ments in the suc­cess of a busi­ness. How­ever, if I had to choose just one word, it would be momen­tum. We learned in high school physics that momen­tum = mass x veloc­ity. For our pur­poses, in busi­ness, mass is com­prised of the peo­ple work­ing in the busi­ness, the cap­i­tal invested in grow­ing the busi­ness and the uti­liza­tion of tech­nol­ogy to fos­ter growth. Veloc­ity is the rate at which the busi­ness grows and the direc­tion in which it is moving.

Momen­tum = Mass x Velocity

The value of a pub­licly traded stock goes up or down based upon the per­cep­tion of the momen­tum in the busi­ness. If a com­pany reports that its rev­enue will not meet pro­jec­tions in the next quar­ter, the mar­ket usu­ally reacts neg­a­tively and ham­mers the share price. When you do not know where your next sale will come from, or what your rev­enue will be over the next year, your busi­ness is likely los­ing momen­tum. Your biggest chal­lenge in grow­ing your busi­ness is to con­trol the growth tra­jec­tory of your busi­ness. In other words, your great­est chal­lenge is to grow your busi­ness in a pre­dictable manner.

The prob­lem is that this is eas­ier said than done. Only a very small per­cent­age of entre­pre­neurs learn how to make their rev­enue and prof­itabil­ity pre­dictable. Entre­pre­neurs who mas­ter the growth in rev­enue and prof­itabil­ity of their busi­ness become the best in their cho­sen field.

Let me give you an exam­ple. Terry is a finan­cial advi­sor whom I started work­ing with in May of 2002. At that time, Terry was 46 and had been a finan­cial advi­sor for twenty years. His prac­tice had grown to a high six fig­ure busi­ness. How­ever, for the pre­vi­ous five years, his rev­enue remained flat. The busi­ness was not grow­ing. To regain momen­tum, the start­ing point was to revisit his direc­tion. The future dri­ves the present, not the past. The clearer you are about your future direc­tion, the more likely you are to achieve it.

Terry did not have a clear vision or direc­tion for his prac­tice. As a result, he fell into the dif­fu­sion trap. He invested his time, money, energy and cre­ativ­ity into a num­ber of areas. His brother-in-law wanted to get involved in a pizza fran­chise, so Terry became his finan­cial part­ner. Some friends began to invest in real estate, so Terry got involved. His lack of focus and broad range of inter­ests took its toll on his prac­tice. His rev­enue was flat and his expenses were increas­ing. Terry’s income and the prof­itabil­ity of the prac­tice began to suf­fer. At the same time, his var­i­ous invest­ments were not doing well. They also suf­fered from a lack of focus.

The solu­tion to Terry’s prob­lem was quite sim­ple. He needed to rede­fine his vision for his prac­tice. Rather than treat­ing his prac­tice as a cash cow to fund his other activ­i­ties, Terry decided to invest in the area he knew best, his prac­tice. He rede­ployed cap­i­tal back into the busi­ness. This allowed him to hire the right peo­ple to sup­port him and to invest in mar­ket­ing ini­tia­tives that increased sales to exist­ing and new clients. Over the last five years, his prac­tice has grown at a com­pound rate of over 30% per year. He has become the #1 pro­ducer with his major sup­plier. He is grow­ing his prac­tice in a pre­dictable man­ner and has gained mas­tery over the growth tra­jec­tory of his busi­ness. Even more impor­tant, he is hav­ing fun again and is pas­sion­ate about build­ing his business.

Norm Trainor is the founder of The Covenant Group, a com­pany spe­cial­iz­ing in prac­tice devel­op­ment for advi­sors. For fur­ther infor­ma­tion, visit his Web site at www​.covenant​group​.com.

Fol­low The Covenant Group at:

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Tags: Audience, Choose One, Elements, Greatest Challenge, Growth Trajectory, Growth Velocity, High School Physics, Innovation, Mass X, Momentum, Motivation, Next Sale, Norm Trainor, People Working, Percentage Of Entrepreneurs, Perception, Physics Momentum, Predictable Manner, Profitability, Share Price, Technology, Time Terry, Twenty Years
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Ten minutes that can pay big dividends

Wednesday, August 17th, 2011

Monday’s post out­lined the case for mak­ing con­ver­sa­tions with clients a pri­or­ity this week.  The post described the anx­i­ety that some clients will be expe­ri­enc­ing as they think about their invest­ments over the hol­i­days and sug­gested a strat­egy to pre­empt some of that con­cern with a call this week.

Clients aren’t the only ones who might be wor­ry­ing over the hol­i­days, how­ever. The assis­tants and asso­ciates who work with advi­sors may be just as con­cerned, won­der­ing about their futures and what’s in store for 2009. And just as a short chat can reduce some of the anx­i­ety for clients, so a brief con­ver­sa­tion with your assis­tant before the hol­i­day break can pay big div­i­dends in decreas­ing their stress over the hol­i­days, increas­ing their level of com­mit­ment and help­ing them return in the New Year with increased moti​va​tion​.In many respects, what you say to your assis­tant might be quite sim­i­lar to the con­ver­sa­tion with clients. Just as with clients, you want to achieve two things — first to let them know that you appre­ci­ate their sup­port and sec­ond that you have a plan for 2009.

Per­haps you’ve already had this con­ver­sa­tion with your assis­tant. If not, here’s what you might say at some point in the next cou­ple of days:

“First, I want to let you know how much I appre­ci­ate your help and your sup­port and extra effort over this past year. 2008 has been a bru­tally dif­fi­cult year, the tough­est that any­one I’ve talked to can recall. I know that there were times since Sep­tem­ber that clients were stressed when they called in and also times that I was short with you after a tough meet­ing or phone call. I really appre­ci­ate your patience over the past few months.

Sec­ond, I’ve been giv­ing some hard thought to 2009. From every­thing I’ve heard and read, there are going to be some ter­rific oppor­tu­ni­ties next year to con­sol­i­date rela­tion­ships with exist­ing clients and also to pick up new clients. I’m going to be giv­ing that some thought over the hol­i­days — when we come back in Jan­u­ary, I want to sit down and talk about my plans to cap­i­tal­ize on those oppor­tu­ni­ties and make 2009 a great year.

In the mean­time, thank you again for all your help in get­ting us through 2008.”

You may want to sup­ple­ment that con­ver­sa­tion with a bot­tle of wine. Whether or not there’s a gift attached, what’s impor­tant is that you ensure your assis­tant knows that you truly value their help this past year and that they’ll have a chance to par­tic­i­pate in your plans to get your busi­ness gets back on track in 2009. Ten min­utes to make that point can be one of the best uses of your time today.

For more infor­ma­tion, please visit http://​www​.get​keep​clients​.com.

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Tags: Anxiety, Break, Conversations With Clients, Couple Of Days, Dividends, Futures, Holiday Pay, Holidays, Investments, Motivation, New Year, Patience, Priority, Relationships, Respects, Stress, Terrific Opportunities
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The Advisor’s Success Measure – A Profitable Client Relationship

Wednesday, August 10th, 2011

I con­tinue to be sur­prised when finan­cial advi­sors mea­sure their suc­cess based upon the trans­ac­tion value of a sale or client assets under man­age­ment (AUM). Today, the mea­sure of an advisor’s suc­cess is the prof­itabil­ity of the client relationship.

Let me give you an exam­ple. Neil had been an advi­sor for 21 years, but had reached his peak rev­enue five years ago. He was tired of work­ing harder and harder for the same return. That was his moti­va­tion to get involved in our Prac­tice Devel­op­ment Program.

Most advi­sors don’t under­stand the rela­tion­ship between profit and their clien­tele and how best to har­ness the value of each client rela­tion­ship to gen­er­ate a profit. I asked Neil how many clients he had.

“Roughly 300 fam­ily units,” he answered. A typ­i­cal advi­sor works at a deep level with 40 or 50 clients.

“Neil,” I said, “I don’t think you can tell me with con­vic­tion that you have rela­tion­ships of any depth with clients out­side your top tier. Do you know each client’s finan­cial and life goals, the issues and prob­lems they face, their deep­est needs, wants and val­ues?  Do you know if you are their pri­mary advi­sor?  Who their other advi­sors are? What their total net worth is?  How many prod­ucts or ser­vices they have with you com­pared to their other advi­sors? How much wallet-share you have?”

Neil admit­ted he couldn’t answer many of these ques­tions for the bulk of his clien­tele. I then went on to explain to Neil that If a typ­i­cal advi­sor were to graph his or her profit against their clien­tele, they would most likely find that 150% or more of their profit comes from their top 40 clients. The rest of their clients take them back to 100%. So, the profit they make on their key rela­tion­ships is lost on the mass of their other lower-level relationships.

But this doesn’t need to be the case. With the right strate­gies in place, an advi­sor can extend the profit poten­tial well beyond the 40-client mark.  Fur­ther­more, the remain­der of their clien­tele can add to their profit rather than detract from it, albeit at a decreased rate.

Neil asked if I was sug­gest­ing he seg­ment his client base.

“Yes,” I said, “but I want you to have a clear under­stand­ing of the effect of seg­men­ta­tion on profit, and how exactly to seg­ment your client base. I don’t believe a lot of advi­sors go about it the right way. You need to have sound cri­te­ria for seg­ment­ing your clien­tele and the dis­ci­pline to apply the appro­pri­ate ser­vice lev­els for each seg­ment. Too many advi­sors aren’t rig­or­ous enough. They tend to pro­vide either too much or too lit­tle ser­vice to dif­fer­ent seg­ments and this drags down their profit.”

Neil asked what cri­te­ria he should use to seg­ment his client base.

“We use three cri­te­ria: 1. Value; 2. Propen­sity to buy; and 3. Will­ing­ness to intro­duce, rec­om­mend and refer you to peo­ple who fit your Ideal Client Pro­file. You need to exam­ine the poten­tial of each client based upon these three fac­tors. Value is based on things such as the client’s net worth, the assets you man­age and the pre­mi­ums they pay. Propen­sity to buy con­sid­ers the num­ber of prod­ucts and ser­vices they could buy from you in the future. The third mea­sure is their abil­ity and will­ing­ness to lead you to other high-value prospects.

“Some clients might have high value, but a low propen­sity to buy.  You can graph the value poten­tial of your clients against their propen­sity to buy. Ide­ally, you want to find as many clients with high value who also have a high propen­sity to buy. Those, of course, are going to be A clients. But if a client is not likely to do addi­tional busi­ness with you, you’re prob­a­bly bet­ter off cat­e­go­riz­ing them as B or C clients.

Your next chal­lenge is to come up with a strat­egy for real­iz­ing the poten­tial profit each client rep­re­sents. For finan­cial advi­sors there are essen­tially four key strate­gies to focus on: 1) grow your client’s assets under man­age­ment; 2) cross-sell, 3) con­sol­i­date; and 4) make your­self refer­able. If you apply these strate­gies to your high-value clients who have a high propen­sity to buy, and a will­ing­ness to help, you will increase the prof­itabil­ity of your business.”

“But I won’t have time to ser­vice all of my clients,” Neil said.

“For each seg­ment of your clien­tele, you require a Ser­vice Level Agree­ment (SLA). It is impor­tant that the ser­vice you pro­vide fits your profit for­mula. That’s what becom­ing prof­itable in each client seg­ment is about. The imple­men­ta­tion of your SLAs involves var­i­ous options. You can del­e­gate ser­vice func­tions to staff, share the ser­vic­ing with another advi­sor or mar­ket­ing ser­vice, or hire a junior advisor.”

Neil agreed. He had reser­va­tions about tak­ing time away from his busi­ness to seg­ment his clien­tele and develop a mar­ket­ing, sales and ser­vice strat­egy, but he forced him­self.  He booked three days out of the office and worked on his busi­ness plan.  He was sur­prised at the results.

His meth­ods for mar­ket­ing, sell­ing and ser­vic­ing his clien­tele were more messed up than he thought. There were lots of high-value clients with a propen­sity to buy whom he treated like C or D clients and too many C and D clients with whom he spent way too much time and energy for them to be prof­itable. It was no won­der he hadn’t been able to grow his busi­ness over the past few years.

Within a few months, Neil imple­mented his SLAs for each client seg­ment. He focused more of his time on those clients who were of high value, have a propen­sity to buy and were will­ing to refer. In addi­tion, he brought in a junior asso­ciate to whom he del­e­gated the C & D clients. Before long, he was already see­ing great results. His rev­enue increased over 50% in the next year and his profit by over 70%.

Norm Trainor is the founder of The Covenant Group, a com­pany spe­cial­iz­ing in prac­tice devel­op­ment for advi­sors. For fur­ther infor­ma­tion, visit his Web site at www​.covenant​group​.com.

Fol­low The Covenant Group at:

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Tags: Assets Management, Assets Under Management, Client Assets, Client Management, Client Relationship, Clientele, Conviction, Financial Advisors, Financial Success, Graph, Life Goals, Lost, Motivation, Net Worth, Norm Trainor, Profitability, Relationships, Sale Management, Success Measure, Transaction Value, Wallet Share
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Developing an optimistic outlook

Wednesday, July 13th, 2011

Every advi­sor rec­og­nizes that a rea­son­ably opti­mistic out­look is among the most impor­tant traits we can bring to the job, the nec­es­sary first step that makes every­thing else we do possible.These days, we need to put explicit strate­gies in place to stay moti­vated — for most of us, moti­va­tion doesn’t hap­pen unless we make it happen.

We also need to tap into new research on ways to keep an opti­mistic frame of mind — an exam­ple of this research was the topic of my June col­umn in Invest­ment Exec­u­tive, fea­tur­ing the work of Dr. Mar­tin Selig­man, who ten years ago authored a book called Learned Opti­mism: How to change your mind and your life.

Seligman’s research has shown that opti­mism isn’t just some­thing that we’re born with — rather we can develop the skill of main­tain­ing a pos­i­tive point of view even in the face of dif­fi­cult circumstances.

Under­pin­ning his the­ory of “learned opti­mism”  is the notion that each of us devel­ops either a pes­simistic or an opti­mistic out­look. This out­look is not set in stone — rather it can be changed.

This arises from Seligman’s analy­sis of people’s “explana­tory style”  — how we explain neg­a­tive events to our­selves.  When some­thing neg­a­tive hap­pens, as it inevitably will at some point, how we respond is a func­tion of the extent to which we view the event on three key dimensions.

Per­ma­nent  - Pes­simists believe neg­a­tive events will be per­ma­nent, while opti­mists believe that    they will be temporary.

Per­va­sive — Pes­simists believe neg­a­tive events are uni­ver­sal, affect­ing every­thing they do.  Opti­mists believe them to be spe­cific and lim­ited to indi­vid­ual circumstances.

Per­sonal — Pes­simists believe they are entirely respon­si­ble for neg­a­tive events. Opti­mists tend to assign at least part of the respon­si­bil­ity to events beyond their control.

Selig­man has iso­lated opti­mistic behav­ior as one of the defin­ing char­ac­ter­is­tics of suc­cess­ful peo­ple.  Using var­i­ous tech­niques he’s devel­oped, he pre­dicted elec­tions by ana­lyz­ing each candidate’s explana­tory style — gen­er­ally, the most opti­mistic can­di­dates win. (Ronald Rea­gan is a clas­sic exam­ple of this.)

If you can make your explana­tory style more opti­mistic, you’ll cre­ate more pos­i­tive energy and hope for your­self, no mat­ter how dif­fi­cult or neg­a­tive the cir­cum­stances with which you must deal. And by pre­sent­ing a more opti­mistic out­look, you’ll be some­one that exist­ing and prospec­tive clients are attracted to and feel bet­ter work­ing with.

At the core of learned opti­mism is one pow­er­ful principle:

Your thoughts influ­ence your feel­ings and your actions — and you can choose your thoughts.

To read more about exactly how to make this hap­pen, go to Invest­ment Exec­u­tive
01 Jun 2009

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Tags: Characteristics Of Successful People, Circumstances, Dr Martin Seligman, Explanatory Style, Extent, Frame Of Mind, Investment Executive, Job, Learned Optimism, Motivation, Notion, Optimistic Frame, Optimistic Outlook, Optimists, Pessimists, Point Of View, Set In Stone
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