From the May 2006 issue of Wealth Manager Web • Subscribe!

Keep it Simple

Most readers know the name David Yeske because he presided over the Financial Planning Association in 2003. But relatively few people know anything about Yeske's business and, if you're a student of these things (something I highly recommend for your own success), his business is one worth understanding.

The first thing one notices about the 48-year-old Yeske's San Francisco-based Yeske & Company, Inc. is its unorthodox Website. A visit to http://www.yeske.com/firm.htm reveals a site light on self-promotion and heavy on education--a reflection of Yeske's philosophy of client service. "I've gotten a lot of clients who, after lurking on the site for a while and then coming to me, have said, "What I get from your site is a strong sense of your philosophy, and I want to work with you."

What is his philosophy? Nothing that unusual, really. Yeske wants to help his clients with their financial futures, just as most of us do. And he learned to provide that service through a process that will be familiar to many SEC-registered RIAs.

After opening his doors in 1990, Yeske spent much of the decade providing a Chinese menu of services including stand-alone, hourly planning, asset management, economic consulting and even some expert witness work--all "one-off projects," as he puts it. "What would happen is a client would come in and hire me, and I'd go into a funk because it was just another project that would eventually end." Yeske knew he needed to rationalize what he was doing, so he observed the most satisfying and successful client relationships he had and, from that conceived one integrated service: Ongoing comprehensive financial planning and asset management paid for by a single, asset-based fee. Not that unusual, really.

"Mark Hurley tells us a firm my size needs to have a niche, such as working solely with surgeons. My response-- 'How boring would that be if all my clients did exactly the same thing!'" Rather, Yeske looks for the type of clients many firms like his thrive on. What Yeske's clients have in common is not occupation or even geograhical location, but the fact that they are "...delegators who see us a partner, not an arms-length service provider."

And in that last characteristic is the key to Yeske's success. Most advisors who intentionally keep their firms small and personally interact with their clients pay some dues before they hit on their preferred ideal-client profile. "The period 1999-2000 was an important threshold when the last client who wasn't a good fit for me either self-selected out or was invited by me to leave," Yeske recalls. " I was finally able to recognize when there was a disconnect--that is, when a client's belief system wasn't a good fit." Now, Yeske's 75 clients with average net worth in the $1.5 to $2 million range love him and his staff and feel they're getting value. "They don't ask about our fees; they thank me for being in their life."

His staff? Just how big is Yeske and Company? Let's just say it's amazing how little human effort it takes to provide superior client service and make a very comfortable living when you employ "E-Myth" principles and master the technology available to you. The key, says Yeske, is "to make every plan customized with just one process," a seeming contradiction that only highly-systematized advisors will truly grasp.

Yeske's systems begin with his business model and an office he describes as "virtual," a description that may mean different things to different people. What "virtual" means to Yeske is how he communicates with clients. "Clients know they can always get me on my cell phone and that no matter what I'm doing, I've got access to email." If you're saying to yourself, "That wouldn't work with my clients," you're probably right. "The whole virtual office thing is a matter of what kind of clients you select. Most of my clients are comfortable with email and will deal with me on important matters entirely by email."

Of course, his Website is a big piece of his client communication system--perhaps more so than for most other advisors. Its unique feature is each client's "private page."

"The beauty of the Web is that it's interactive," Yeske explains "Each client has an action list on his private page, and every action item becomes a hotlink to an insurance quote, a contact with the client's attorney, a dollar-cost-averaging schedule we're following-- some kind of task, in other words."

The private areas most advisors include on their Websites don't necessarily engender a lot of client participation. In fact, most of these pages are simply conduits to the clients' investment custodian Websites. Yeske's clients really interact with him through their private pages, which he programmed himself. "The clients get wedded to the process of checking off items on their action lists. Half of the communications I get from clients say, 'I did that... let's check it off.'" Once an action item is ticked off, it moves to a "history page" within the client's private area giving Yeske and his clients a permanent record of everything they've done together.

How about investment reporting? Most advisors agonize over how often to give their clients investment position and performance reports. Yeske has no doubts. "I provide monthly reports. It's not that I want to encourage short-term thinking among my clients; it's that I track clients' log-ins to their private areas and I know that about a third of my clients go in every month. The other two-thirds go in maybe once, twice, three times a year. So, whenever they check, I want their investment information to be current."

The other reason Yeske's Website has become such an effective client communication device is that he prompts clients to use it. "Every month when I update their private pages, I send an email to the client telling him his page has been updated and mentioning other new stuff on the site." Every email is another high-quality "touch" Yeske gives his clients.

The other "stuff" he alludes to in these emails runs the gamut from recommended reading to articles he's personally authored, adding value apparent to prospects as well as clients. "Some prospects say they would rather work with me remotely than a local advisor with whom they're not as close a philosophical match."

Yeske had other Websites he'd visited in mind when he built his own, specifically those sites that spend less time saying, "This is who we are and what we do," and more time giving the user precisely the information he is looking for. In fact, Yeske's site even has a searchable database of all the planning articles he's uploaded. "I post three new articles to the Website every month--usually financial planning, not investment, articles. I'm amazed at how many clients perceive them as adding value, saying things like, "Thanks, I was wondering about Medicare Part D... I'll go to the Website and read that."

What if an older client doesn't have a computer and the client's own children believe their parent to be incapable of using one? Yeske has been known to pick up the client, drive them to Circuit City, purchase a computer system, return to the client's home, set it up for them-- along with an Internet account-- and make www.yeske.com their home page. The children benefit, too, because now they can reach their parents by email.

The point is:Yeske and Company isn't a stodgy advisory firm that welcomes clients into its offices every day. "If they want to come in, we have beautiful offices, but the clients really don't care where we are. They think of us as problem-solvers, and me as someone good to think with. They want me to walk an issue around the block with them. In other words, they don't care where I am if they can get a detailed answer by email."

Which brings us full circle to Yeske's philosophy about the ideal client. "Rule #1 is that this style of doing business must be a fit for the client," he says. "Some of my clients, if they're outside the city, I may only see once every two to four years." Yet, he's working continuously with them on getting things done.

Amazingly, everything we've described thus far has been done by Yeske with only one associate. "Mary, my client service administrator and paraplanner, was my sole assistant until recently," Yeske explains. "As client service was taking up more and more time, and as I continued to think of ways to be proactive with our clients, I was finding I didn't have the capacity to do more without more support for Mary. So Sean is our new client service administrator, and Mary is in the graduate financial planning program at Golden Gate University."

You may wonder what kind of background you would need to duplicate Yeske's experience. First, he has an academic background in economics and market theory. He did a stint on the options trading floor of the Pacific Stock Exchange, spent time with the Paul Revere world of long-term disability contracts and, from there discovered the existence of financial planning as a profession. "I followed the traditional model initially but, within six months, I realized it made no sense." He dropped all his licenses and went fee-only, saying, "I've never looked back."

So what does Yeske see looking forward? Interestingly enough, his future might hold the emergence of another powerhouse financial planning duo as he and high-profile planner Elissa Buie prepare for their wedding around mid-2006. They met when both served on the FPA's National Board about four years ago. Although a merger of their practices may or may not be in the works, it's clear that Buie fills some of the gaps in Yeske's areas of expertise.

For example, she engineered the hiring of both Mary and Sean. "She wrote the job descriptions, posted them on the FPA Website, set up the 'planner search email account' where all the resumes came in, she read them all, developed "A," "B," and "C" stacks, arranged and conducted interviews, and sent me the most qualified applicants to interview. "Elissa is really good at the process; it's one of her core competencies."

Yeske says that one of the accomplishments of his FPA presidency he's most proud of was his ability to facilitate a good process by which the Board and staff could relate and work together. Looking at his efficient and friendly business model, it's not hard to see how he did it.

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David J. Drucker, MBA, CFP, an independent financial advisor since 1981, writes, speaks, and consults with other advisors as President of Drucker Knowledge Systems. His new practice management portal--Practice Lifecycle--is located at t www.practicelifecycle.com. He also publishes and Virtual Office News-- the only monthly practice management/technology newsletter for financial advisors, accessible at www.virtualofficenews.com.

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