From the March 2009 issue of Research Magazine • Subscribe!

March 1, 2009

Leadership in Tough Times

How top Citi Smith Barney producers are actively preparing for their best year yet in wealth management.

Imagine several dozen of the nation's top financial advisors dressed in Under Armour, getting their blood drawn by technicians in white lab coats. Throw in a make-your-own-trail-mix and fruit kebob bar and a marketing director who bursts into her favorite camp song and you know this is not going to be your typical industry conference.

In January, 80 of Citi Smith Barney's elite corner-office advisors -- folks who rank in the top 1 percent -- gathered at a resort in Orlando as part of an extraordinary pilot project to make their wealth-management practices bigger, better, faster.

The premise: Get advisors to attain physical, mental, emotional and spiritual wellbeing and they will put more energy and enthusiasm into their work and personal lives. Whoa, what?

"We're asking them to think differently about what success is -- making sure that as you grow your practice you are growing and building your life," notes James J. Tracy, the firm's director of Global Wealth Management Business Development. "By increasing your energy and being more fully engaged, you have the capacity to take on more challenges."

The program, called Vista, has more than produced the desired outcome.

Six months into the year-long pilot, early results show Vista advisors outperformed a peer group that did not participate in all the categories that count: assets under management, revenue growth and client acquisition and retention. Also to the good, the attrition rate was lower.

In fact, Citi Smith Barney executives are so pleased with the curriculum - designed by the financial services consulting and coaching firm CEG Worldwide and Human Performance Institute, an energy management consultant -- the company plans to introduce components of it firm-wide.

The Global Wealth Management Institute, as it's being called, launches this month. Producing a series of 25 programs a year, the institute will incorporate the core concepts of Vista -- such as peer-to-peer counseling, enhanced client discovery and personal development -- along with other training initiatives on topics such as investment management and best practices. [Editor's note: At press time, Citi Smith Barney and Morgan Stanley were expected to formalize a joint venture toward the end of the year. In the meantime, Tracy said the firm's global wealth initiatives were continuing to operate on a "business as usual" basis.]

In a dark market environment like this one, the Vista program provides some light. Stories from the advisors are compelling. One advisor, Grant Lee, lost 35 pounds -- his San Francisco-based team a total of 100. "Life-changing," he calls it. "I scoffed at it at first. I was in complete denial," says Lee, whose team manages $4 billion. "I was in a box. I feel like I've had my coming out party."

Larry Palmer, who manages a little over $1 billion from offices in Los Angeles, has brought in key new assets since using Vista's client discovery questionnaire. "We've all read sales and motivation books," he says. "The difference is this stuff is actionable."

And Mary Deatherage, a Little Falls, N.J., advisor who manages $1 billion in assets, says Vista has caused her to listen to her clients more intently. "I think of it as a new world and a new relationship -- and that's what I'm telling clients," she says.

How does Vista work? It starts with the physical. Over the past nine months, at two different conferences, advisors have been tested for cardiovascular fitness, body composition, cholesterol, triglycerides and blood sugar. The results: "very alarming," according to Human Performance Institute founder Jim Loehr, a performance psychologist who counsels high-stress workers such as nuclear plant operators, air traffic controllers and anti-terrorist squads.

"These advisors understand the risk of the market, but they don't consider their own risks when it comes to taking the necessary steps to ensure their health," said Loehr. "High stress, a sedentary lifestyle, very poor diet, little exercise -- it's a lethal combination. Once they get it, and they're smart people, they realize what the risks are. They need to face the truth and find practical ways to correct it before there's a train wreck." Advisors will be re-tested at another conference in Dallas in March.


Over the past months, the physical component of the program has forced many Vista advisors to confront unhealthy habits. In fact, when the group's bloodwork results were first announced to the group, Paul Blease, director of Citi Smith Barney's team initiatives, called it "one of the most profound moments I've ever witnessed. It was an epiphany."


As he frames it: "How do you create a life to give you energy, drive and purpose to actually execute? It's what's historically been missing in corporate America, and in our industry more than most. It's the energy of these guys that creates this industry. I've always told them: If we can fix you, your business thrives."

Vista advisors say they've benefited in three ways from the wealth management curriculum developed by CEG: its content, the ongoing coaching program and peer counseling. At the two-day conference in Orlando, CEG founder John Bowen walked advisors through a number of key subject areas: identifying an expert team; unlocking your niche's potential; developing a 12-month marketing action plan; positioning yourself as an expert in your clients' eyes; building alliances with attorneys and accountants; and establishing an asset capture plan.

But what seemed to resonate most with advisors was CEG's exhaustive 61-question client profile interview guide, which many have already incorporated into their practices. Among the questions: What's important to you about money? If you didn't have to work anymore, what would you do? What are your personal goals? What is your opinion of taxes? What were your best and worst experiences with a professional advisor? Do you have health concerns or interests? How involved do you like to be in managing your finances?

The questionnaire gets to the crux of Vista, which is centered around the process of discovery with deeper knowledge and, subsequently, deeper relationships. As Marc Fischer, a Rochester, N.Y., advisor who manages $2 billion, notes: "We thought we asked really good questions. They introduced us to more insightful questions. It gets people really talking."

And, of course, it's not lost on anyone that advisors today are facing challenges unlike no other -- challenges that require new solutions.

"The world has changed. We're seeing history being made. What's made us successful in the past won't in the future. Not only are clients losing confidence but, if advisors are honest, advisors are losing confidence," Bowen told the group. "Companies are going to have to change the way they're doing business and how they provide leadership to the client."

With client loyalty shattered, Bowen foresees a huge transfer of accounts -- perhaps the largest ever.

"Commit to change. The affluent want a different experience; they want an advisor who gets them. The No. 1 driver of success in this market is your quiet confidence," he added. "This will be the best growth year for everyone in this room who wants it."

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Marc R. Fischer, Rochester, N.Y.

One upside of the current market climate is that it has stress-tested Marc Fischer's practice and process -- and reinforced the strength of all the moving parts.

"I didn't think we were behind the curve. In fact, I felt we were in a position to survive and thrive. This has actually been an incredibly opportunistic time for us," says Fischer, 43, who -- with over $2 billion in assets -- does a large institutional business with endowments, foundations, unions and pensions. With a team of nine, he also serves as a senior advisor to high-net-worth families.

"We try to think a little bit outside the box -- it's what got us there," adds Fischer, an advisor for 20 years. Citi Smith Barney's Vista program hasn't caused Fischer to change his thinking, but to refine it.

Fischer says it's helped him manage the business better by communicating more openly. It's also made him pay attention to his energy level. He's added a recumbent bike to his exercise regimen, and the office, he jokes, is now a repository of power bars, yogurt and cheese sticks. "You need to have energy in order to have engagement. I couldn't have gotten through this way without the energy component," he says. "For me personally, it's materially improved my health."

One of the team analysts also has a new job title: Vista Officer. At weekly meetings, the team discusses what's working -- and what could work better. The "VO" is charged with fusing Vista concepts into the practice. As Fischer puts it, "Vista is not meant to be CFO in a box. It's kind of like spaghetti. You throw it against the refrigerator and see what sticks."

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Barbara Finder, Chicago

Over the last months, Barbara Finder has re-profiled her top 75 client households. Her message: The world has changed. Has their thinking changed as well?

"I wanted to step back and re-establish -- and this is important to me -- client trust. It's not something you take for granted right now," says Finder, 50, a sole practitioner with $230 million in assets under management.

Tops on her list: a discussion of client risk and reward.

"I want to re-establish whether they want preservation of capital or growth of capital or a little bit of both. One of the biggest problems in the last year is that we never thought it could get this bad and never talked to anybody about what if it does," says Finder, who also uses the time to remind her clients -- mostly entrepreneurs and attorneys -- about her value and her process.

Re-profiling is at the crux of the Vista program and Finder, an advisor for 25 years, says its 61-question client-profile-interview guide has helped her to dig deeper with clients. "It's helped me go in the front door with new questions," she says. "It's built my confidence in speaking with them.

As a result, she says, the client conversation has become more sophisticated and her correspondence crisper.

"What I do best is bringing new clients in. I'm a people person. I love getting in front of somebody and, hopefully, getting them to open up to me," Finder adds. "What this has helped me do is look at the picture from 30,000 feet. It's helped me ask more pointed questions and it's reminded me: Don't be afraid to just ask for what you want -- like a referral. Like everything in life, you don't know what the answer will be unless you ask."

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Mary Deatherage, Little Falls, N.J.

Mary Deatherage is very systematic when it comes to client contact -- even more so now. She's been in touch with each one of her 250 client households over a dozen times since September. She's close enough to the flame, for example, to know that one couple who always stay in the same $500-a-night hotel room for their ski holiday elected this year to cap the cost at $150.

"Clients' perceptions have changed a lot. It's almost like people who lived through the Great Depression, they never got over it. They're still saving rubber bands," says Deatherage, 55, who manages $1 billion in assets for high-net-worth and ultra-high-net-worth clients, mainly corporate executives. "How clients spend, invest and what their safety net really is has been altered for a very long time. It's great to grow your business, but I've got to take care of the people who got me here in the first place."

Her attention to communications systems and flow is also what attracted Deatherage, who manages a team of 17, to some of the key elements of Vista: developing centers of influence in a disciplined and strategic manner; ongoing check-ups with her coach; and peer counseling every two weeks with four other advisors.

"We're all living under the same roof, so to speak. Everybody gets it," she says. "Just like a coach, your peers force you to keep on course."

Thanks to Vista, she's also started to walk two miles each day, longer on weekends. She says the program has brought a clear-headedness that's reinforced through peer counseling, meetings, webcasts and homework assignments.

"It starts to become part of you. It gets embedded in your brain," Deatherage adds, "I do think before I do things now. It's even helped me with team management, which wasn't even their goal. I have time to think now, instead of reacting. That's a good feeling."

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Grant Lee, San Francisco

If Grant Lee, 48, has one takeaway from the Vista program, it's this: Think BIG. About his $4 billion practice, Lee says: "It's kind of like it's on steroids now. I'm more than excited about this. I'm out of my mind."

In the past months, Lee and partner Tony daRoza have made some major adjustments to their 10-person team. For starters, they hired a junior partner to head up professional relations -- someone whose job it is to build a network of experts from centers of influence. They've booted up a "relentless" sales and marketing effort and they're actively seeking more ultra-high-net-worth clients in the niche they serve: executives in the technology, private equity and venture capital arenas.

Lee calls it a "before and after," adding, "You have to continually reinvent yourself. Life's boring if you're not striving to do better." In an industry that could see another significant down year, Lee's game plan is to be flat or up by as much as 10 percent as he positions the firm for even more gains in 2010.

He has also had huge buy-in from his team, particularly when it comes to Vista's health component. Lee, a trim 180 pounds, has lost 35 pounds -- the team a total of 100. "We probably couldn't take all this on if we weren't at the optimal energy and production level," he adds. "If you're going to go 110 to 120 miles per hour, you need to be thinking clearly."

In addition, Lee says he's much more present with his wife, Kim, and their two children, 14 and 12. "They feel I'm more in tune now. I don't come home lethargic, have a huge dinner and fall asleep. I feel more energized to do a lot of things. The family feels I've been more participative, more connected," he says. "It's always been fun, it's even better now."

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Freelance writer Ellen Uzelac is based in Chestertown, Md.; the former West Coast bureau chief and national correspondent for The Baltimore Sun, can be reached at ellenuzelac@msn.com.

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