Warren Buffett’s Strategy for Effective Client Meetings

Wednesday, September 14th, 2011

Last week I spoke to an investor who got a call from his advisor’s assis­tant about sched­ul­ing a time to review his portfolio.

“I had the same reac­tion as when I get a call from my dentist’s office” said this investor, whose account was worth over $1 mil­lion at the end of 2010. “I rec­og­nize it’s impor­tant and some­thing that I have to do, but also know it’s not likely to be pleas­ant, so put it off as long as I can.”

For many clients, the regret­table real­ity is that meet­ing with their advi­sor is no longer an uplift­ing expe­ri­ence. Instead of antic­i­pat­ing meet­ings with enthu­si­asm, they look to meet­ings with fore­bod­ing. Instead of walk­ing away opti­mistic about pos­si­bil­i­ties, they leave bur­dened down by limitations

This sit­u­a­tion is unhealthy and unsus­tain­able for both clients and for advi­sors. Here are three steps to make client meet­ings a more pos­i­tive expe­ri­ence, includ­ing an idea bor­rowed from War­ren Buffett.

Step one: Be upbeat

For many advi­sors, the chal­lenge of cre­at­ing pos­i­tive client meet­ings starts with being pos­i­tive your­self. Unless you’re upbeat, there’s no chance that your clients will be.

Mar­kets like we’ve seen of late can obvi­ously make this a chal­lenge, but that doesn’t make this less of a pri­or­ity. Being pos­i­tive doesn’t mean that you’re obliv­i­ous to the chal­lenges we’re fac­ing — clients are look­ing for real­is­tic opti­mism, not some­one with a “don’t worry be happy” view of the world.

In Jan­u­ary 2009, I wrote about 12 ways to stay pos­i­tive. Some sam­ple strategies:

- Start by rec­og­niz­ing how impor­tant this is; being pos­i­tive is the nec­es­sary first step to effec­tive inter­ac­tions with clients

- Exer­cise at the start of the day to give you a boost; even a short brisk walk can help

- Find ways to fight fatigue and renew energy dur­ing the day; get some fresh air at lunch, and through­out the day take energy boost­ing snacks like fruit

- Take short breaks; sched­ule a short walk out­side between client meetings

- Be alert to signs that your energy level is drop­ping; before mak­ing a call or going into a meet­ing, take 30 sec­onds to focus on lift­ing your mood

- Seek out pos­i­tive col­leagues who give you energy, avoid neg­a­tive ones who suck it away

Step two: Look past the bad news

It’s hard to main­tain a pos­i­tive out­look when you’re drown­ing in a sea of neg­a­tive headlines.

When meet­ing with clients, start by acknowl­edg­ing the real chal­lenges faced by global economies.

Don’t let the gloom wear you and your client down. Intro­duce some off­set­ting good news. For exam­ple, point to three or four qual­ity com­pa­nies whose prices have been beaten down and shift the focus of the con­ver­sa­tion to the value in rec­og­nized mar­ket lead­ers like Shop­pers Drug Mart, TD Bank or Telus in Canada and McDon­alds, Nes­tle or Wal-Mart out­side Canada.

Step three: Focus on what you can control

War­ren Buf­fett is a name who inspires con­fi­dence among aver­age investors; look at what hap­pened to Bank of America’s share price after his invest­ment was announced. When he dis­cusses the per­for­mance of Berk­shire Hath­away in his annual report and his investor meet­ing each spring, he never men­tions the share price, focus­ing instead on its book value. In essence, he changes the score­card by which his per­for­mance is mea­sured, shift­ing from share price to some­thing he has more con­trol over.

Advi­sors should try to do the same. You obvi­ously have to talk about what’s hap­pened to client port­fo­lios, but need to go beyond that to talk about things which you can influ­ence. For exam­ple, you can set a goal of a 3% annual cash return from your client’s port­fo­lio, bet­ter than what they’ll get on GICs, and as part of your con­ver­sa­tion, talk about their cash flow in the recent period ver­sus that goal.

Or you can talk about the monthly income that clients will receive in retire­ment from all sources of income, based on today’s port­fo­lio and some con­ser­v­a­tive assump­tions on future per­for­mance and com­pare it to the base case needs in their finan­cial plan. Of course, the mar­ket decline means that their pro­jected monthly income will be down com­pared to what it would have been at the start of the year, but depend­ing on how much of a buffer they had in Jan­u­ary, their pro­jected income may still be above their base needs.

If there is a short­fall, chances are that it will be less than clients fear. At least you can have an open con­ver­sa­tion about the options to close the gap, remind­ing clients that if future per­for­mance is bet­ter than the assump­tions, these may not be needed. Again, your goal is to focus on things you can control.

One final note; I’ve writ­ten in the past about the research show­ing that the most pos­i­tive impact from vaca­tions doesn’t come from the expe­ri­ence itself or the pos­i­tive mem­o­ries after­wards, but rather the process of look­ing for­ward to them. The impli­ca­tion is clear; in addi­tion to peri­odic longer vaca­tions to recharge our bat­ter­ies, we should have lots of shorter, more fre­quent hol­i­days, say a four-day week­end away once a quarter.

As part of your strat­egy to stay pos­i­tive, sched­ule these short hol­i­days — and encour­age your clients to do the same. That way, at the end of your meet­ing, you’ll be able to briefly com­pare notes with your client not only on recent trips, but also those that are com­ing up.

And for any­one inter­ested, here’s a link to that 2009 arti­cle on ten tips to stay pos­i­tive http://​www​.cli​entin​sights​.ca/​a​r​t​i​c​l​e​/​t​e​n​-​t​i​p​s​-​f​o​r​-​m​o​t​i​v​a​t​i​o​n​-​i​n​-​2​009

Last week I spoke to an investor who got a call from his advisor’s assis­tant about sched­ul­ing a time to review his portfolio.

“I had the same reac­tion as when I get a call from my dentist’s office” said this investor, whose account was worth over $1 mil­lion at the end of 2010. “I rec­og­nize it’s impor­tant and some­thing that I have to do, but also know it’s not likely to be pleas­ant — so put it off as long as I can.”

For many clients, the regret­table real­ity is that meet­ing with their advi­sor is no longer an uplift­ing expe­ri­ence. Instead of antic­i­pat­ing meet­ings with enthu­si­asm, they look to meet­ings with fore­bod­ing. Instead of walk­ing away opti­mistic about pos­si­bil­i­ties, they leave bur­dened down by limitations

This sit­u­a­tion is unhealthy and unsus­tain­able for both clients and for advi­sors. Here are three steps to make client meet­ings a more pos­i­tive expe­ri­ence, includ­ing an idea bor­rowed from War­ren Buffett.

Step one: Be upbeat

For many advi­sors, the chal­lenge of cre­at­ing pos­i­tive client meet­ings starts with being pos­i­tive your­self. Unless you’re upbeat, there’s no chance that your clients will be.

Mar­kets like we’ve seen of late can obvi­ously make this a chal­lenge — but that doesn’t make this less of a pri­or­ity. Being pos­i­tive doesn’t mean that you’re obliv­i­ous to the chal­lenges we’re fac­ing — clients are look­ing for real­is­tic opti­mism, not some­one with a “don’t worry be happy” view of the world.

In Jan­u­ary 2009, I wrote about 12 ways to stay pos­i­tive. Some sam­ple strategies:

- Start by rec­og­niz­ing how impor­tant this is — being pos­i­tive is the nec­es­sary first step to effec­tive inter­ac­tions with clients

- Exer­cise at the start of the day to give you a boost — even a short brisk walk can help

- Find ways to fight fatigue and renew energy dur­ing the day — get some fresh air at lunch, and through­out the day take energy boost­ing snacks like fruit

- Take short breaks — sched­ule a short walk out­side between client meetings

- Be alert to signs that your energy level is drop­ping — before mak­ing a call or going into a meet­ing, take 30 sec­onds to focus on lift­ing your mood.

- Seek out pos­i­tive col­leagues who give you energy, avoid neg­a­tive ones who suck it away

Step two: Look past the bad news

It’s hard to main­tain a pos­i­tive out­look when you’re drown­ing in a sea of neg­a­tive headlines.

When meet­ing with clients, start by acknowl­edg­ing the real chal­lenges faced by global economies.

But don’t let the gloom wear you and your client down — intro­duce some off­set­ting good news. For exam­ple, point to three or four qual­ity com­pa­nies whose prices have been beaten down — and shift the focus of the con­ver­sa­tion to the value in rec­og­nized mar­ket lead­ers like Shop­pers Drug Mart, TD Bank or Telus in Canada and McDon­alds, Nes­tle or Wal­Mart out­side Canada.

Step three: Focus on what you can control

War­ren Buf­fett is a name who inspires con­fi­dence among aver­age investors — look at what hap­pened to Bank of America’s share price after his invest­ment was announced. When he dis­cusses the per­for­mance of Berk­shire Hath­away in his annual report and his investor meet­ing each spring, he never men­tions the share price, focus­ing instead on its book value. In essence, he changes the score­card by which his per­for­mance is mea­sured, shift­ing from share price to some­thing he has more con­trol over.

Advi­sors should try to do the same. You obvi­ously have to talk about what’s hap­pened to client port­fo­lios, but need to go beyond that to talk about things which you can influ­ence. For exam­ple, you can set a goal of a 3% annual cash return from your client’s port­fo­lio, bet­ter than what they’ll get on GICs — and as part of your con­ver­sa­tion, talk about their cash flow in the recent period ver­sus that goal.

Or you can talk about the monthly income that clients will receive in retire­ment from all sources of income, based on today’s port­fo­lio and some con­ser­v­a­tive assump­tions on future per­for­mance — and com­pare it to the base case needs in their finan­cial plan. Of course, the mar­ket decline means that their pro­jected monthly income will be down com­pared to what it would have been at the start of the year, but depend­ing on how much of a buffer they had in Jan­u­ary, their pro­jected income may still be above their base needs.

And if there is a short­fall, chances are that it will be less than clients fear — and at least you can have an open con­ver­sa­tion about the options to close the gap, remind­ing clients that if future per­for­mance is bet­ter than the assump­tions, these may not be needed. Again, your goal is to focus on things you can control.

One final note. I’ve writ­ten in the past about the research show­ing that the most pos­i­tive impact from vaca­tions doesn’t come from the expe­ri­ence itself or the pos­i­tive mem­o­ries after­wards, but rather the process of look­ing for­ward to them. The impli­ca­tion is clear — in addi­tion to peri­odic longer vaca­tions to recharge our bat­ter­ies, we should have lots of shorter, more fre­quent hol­i­days, say a four-day week­end away once a quarter.

As part of your strat­egy to stay pos­i­tive, sched­ule these short hol­i­days — and encour­age your clients to do the same. That way, at the end of your meet­ing, you’ll be able to briefly com­pare notes with your client not only on recent trips, but also those that are com­ing up.

And for any­one inter­ested, here’s a link to that 2009 arti­cle on ten tips to stay pos­i­tive http://​www​.cli​entin​sights​.ca/​a​r​t​i​c​l​e​/​t​e​n​-​t​i​p​s​-​f​o​r​-​m​o​t​i​v​a​t​i​o​n​-​i​n​-​2​009

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Tags: 1 Million, Brisk Walk, Challenges, Client Meetings, Dentist Office, Effective Meetings, Fatigue, Foreboding, Fresh Air, Investor, Lunch, Optimism, Possibilities, Priority, Scheduling, Short Breaks, Signs, Snacks, Three Steps, Warren Buffett
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Following Up On Client Meetings

Wednesday, August 26th, 2009

Among the speak­ers at the recent Top Advi­sor Sum­mit was Rick Clay­don of Stonegate Pri­vate Counsel.

In the run up to the Sum­mit, Rick shared a sim­ple idea with me that has allowed him to fol­low up every meet­ing with a note within twenty four hours and had a dra­matic impact on his pro­duc­tiv­ity as a result.Like most advi­sors, he’s always rec­og­nized the value of an imme­di­ate fol­low up note after meet­ings with exist­ing and prospec­tive clients, as well as the accoun­tants and other pro­fes­sion­als who serve them.  The chal­lenge is how to get these notes out quickly and consistently.

A cou­ple of years ago he began using a ser­vice that has made a huge dif­fer­ence in his prac­tice. For $80 a month, he sub­scribes to a ser­vice called Copy Talk (http://​www​.copy​talk​.com/).

After every meet­ing, he calls in and dic­tates a quick fol­low up note. The ser­vice offers same day turn­around with unlim­ited dic­ta­tions per day; the only con­straint is a max­i­mum time of four min­utes per dic­ta­tion (so that occa­sion­ally he has to call back and break a longer note into two or three parts.)

The key to mak­ing this work is to build the fol­low up note into your rou­tine — the meet­ing is not over until you have made the call and dic­tated the let­ter. Don’t let fol­low up notes pile up — before leav­ing the office, take ten min­utes to edit and send the notes that have arrived in your inbox that day.

Rick has built his busi­ness through refer­rals from accoun­tants and has shared this idea with some of the accoun­tants he works with as a way to bring value to the rela­tion­ship. He told me that he is happy to share this idea with any advi­sor who finds it of value — note that there is a 30 day free trial to test this out. All he asks if some­one signs up is to note that they heard about Copy Talk from him — the ser­vice relies on refer­rals to grow and offers a small thank to any­one who refers other customers.

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

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Tags: Accountants, Claydon, Client Meetings, Constraint, Dictation, Dictations, Dramatic Impact, Four Minutes, Free Trial, Inbox, Maximum Time, Private Counsel, Productivity, Prospective Clients, Referrals, Signs, Speakers, Summit, Turnaround, Twenty Four Hours
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