From the April 2012 issue of Research Magazine • Subscribe!

March 26, 2012

Pursuing Simplicity

Advisor training embraces the importance of focus and organization.

The financial advisor’s job has never been more complex. No surprise there — but this is. In a departure from traditional thinking, business development leaders are urging advisors to do something that seems almost counterintuitive: Keep it simple.

As Billie Gray, manager of practice development for RBC Wealth Management in Minneapolis, frames it: “From a business development perspective, we made the mistake of thinking if little is good, more is better. We’re discovering now that’s not true. The ability to focus and simplify is critically important to every advisor’s success.”

One big outcome: a happier advisor.

“We hear people say ‘I’m excited to get up and come to work again. I feel like I did in the early days of my career.’ It’s so refreshing,” Gray adds. “You can feel the energy.”

Last year, advisor Jason Wheeler participated in an inaugural business development program, led by Commonwealth Financial Network managing principal Joni Youngwirth, that Wheeler says has transformed the way he works.

“I’m a lot more organized. Instead of feeling overwhelmed by practice management, I now control it. And I’m not out there looking for the next best thing constantly. One thing I’ll never forget is Joni saying: ‘Ask yourself, ask your staff: Who’s the hair in the sink?’ It’s usually us,” says Wheeler, a founding partner of Pathfinder Wealth Consulting in Wilmington, N.C. “It’s usually the advisor.”

On Wheeler’s desk is a note he wrote to himself that says: “Focus.”

The move to focus and simplify is gaining traction at the highest levels of business development thinking and it’s trending across topics — touching everything from branding and hiring to operational efficiencies and the way advisors converse with clients.

“Change is happening,” observes Joseph Rizzo, head of advanced financial advisor development for Morgan Stanley Smith Barney. “I know from a senior management level on down there is a driving force to get people focused and to make it simple to operate a business at this firm. That is our goal and there are some really strong things going on to support that.”

As an example, Morgan Stanley Smith Barney completely redesigned its investment conference for top advisors this year. Among other things, it provided advisors with iPads so that they could forward to their email notes that they took or presentations they want to revisit.

At Merrill Lynch Wealth Management and Private Banking and Investment Group, learning executive Clara Musto says the firm has launched a pilot program to push content to some mobile devices to make it easier for advisors to access information where and when they want it. Some of the most compelling content: videos of top advisors on winning strategies they’ve implemented.

“What they’re really looking for are opportunities to understand other best practices out there that can help them maximize their time so that they can truly focus on the key activities that will continue to drive their business,” says Musto.

Practical Improvements

Here’s a look at how the trend to keep it simple is shaping practice development:

The client conversation: Industry consultant Mitch Anthony often tells advisors that their success is defined more by their likability than their ability. He’s not joking.

 “At the end of the day, the only thing that pays the bills is the quality of the conversation,” he says. “Conversation is make-or-break. If you sound like everyone else, good luck.”

To fully connect with a client or prospect, according to Anthony, the advisor must demonstrate interest, understanding and empathy. How? By asking the right questions. “It can be as simple as defining one or two new questions that can open a brand new dialog,” says Anthony, founder of the Financial Life Planning Institute. “The questions can’t feel invasive — and they have to feel irresistible to answer.”

Among the lead-ins Anthony has developed in his “question laboratory”: Where did you grow up and what was money like growing up? Is anything happening in your life right now that could have a major impact on your financial future? Have you had any experiences, good or bad, with other financial professionals that you feel are worth your time to tell me about?

“With messaging often supplanting conversation today, a lot of people are getting away from real conversation,” says Anthony. “There’s more money to be made in authentic genuine conversations than anything else. My theory is that there is only one way human beings connect and that is through story. These are the kinds of questions that will open the whole storybook.”

Operational efficiencies: With its development programs, RBC Wealth Management has built in an efficiency piece to help keep advisors in front of high-net-worth clients 80 percent of the time.

“There are ways of doing less and simplifying,” says RBC’s Gray. “It’s all about focus and energy. If you have focus but you don’t have energy, or energy without focus, you’re not going to be as productive, as engaged or as happy.”

The one-year programs, which involve a workshop and customized coaching, offer tips such as: Schedule a certain time of day to make calls and manage email. Ensure that team members are communicating well. Write down your goals and share them with a colleague. When a client associate takes a call from someone asking for the advisor, have the associate ask if he or she can help instead.

 After going through RBC’s program for elite advisors, Scott Hill, senior vice president of The Carillon Consulting Group in Kirkland, Wash., put together a 90-day engagement schedule for clients new to the firm.

“We didn’t have a written timeline disciplined approach: ‘Here’s what we’re going to do and here’s how.’ As a team, we did a lot of these things, we just didn’t do them nearly as efficiently or as well,” says Hill. “Now, we have enough time in our day to spend it with clients and focus on issues aside from simple investment management. If you put a disciplined process in place, then there’s plenty of time in a day to get things done.”

Social media: Raymond James & Associates advisor Jeffrey Blum writes a retirement planning blog every weekend — but it takes time. With a compliance-approved social media tool he started using in November, Blum now has a professional Facebook page, a LinkedIn profile and a Twitter account.

The content is pushed largely from Raymond James Marketing so it doesn’t cost Blum a lot of time. What it has done is drive traffic to his website. It’s up a thousand-fold.

“I love it, clients love it,” says Blum, who is based in Westlake Village, Calif. “It’s one extra touch.”

The system, called Engage from the firm Actiance, also lets users know who is following them — whether it’s someone who is retweeting their links to articles or commenting on content. At the moment, Raymond James is uploading 40 to 50 of the pre-approved pieces a week. The most popular topics tend to be personal: golf tips, travel, food and wine.

“It’s another way to focus on the client. We think there’s a potential for business development,” notes Katie Berg, product manager of digital assets for Raymond James Marketing. “It’s one additional touch point for client communication.”

Accountability: Commonwealth Financial Network’s new Power in Practice business development coaching program focuses on leadership, human resources, office efficiencies, marketing, production and risk management — and underlying them all is one important fundamental: advisor accountability.

“Over the years we’ve sponsored several programs but none involved the structure and accountability we require here,” says Youngwirth, managing principal of practice management. “It really sorts out the people who are truly committed to this. We’ve seen real results because advisors had to answer to one another.” Not only is there peer-to-peer accountability but Youngwirth herself does one-on-one coaching sessions with participants over the course of a year.

Youngwirth says the program keeps it simple by setting very clear goals. The human resources section, for example, demands certain deliverables: job descriptions, performance reviews and a listing of the top three things employees want from their workplace.

“Advisors stew over HR all the time. We need to make it simple,” she said. “You can manage ad nauseam and feel like you’re never going to get there. The biggie here is they end up with a practice management infrastructure that can last the rest of their careers. And that’s huge. By focusing on the basics of these six areas, and by staying accountable, they can run a good small business.”

Branding: With a surge in demand by advisors across channels for individual branding guidance, consultant Scott West is pushing simplification hard.

“We’re working on having them differentiate and simplify,” says West, head of consulting for Invesco Van Kampen Consulting. “As Steven Jobs said: ‘Simplicity is the highest form of sophistication.’”

To drive that point home, the consulting group has taken a page from Hollywood’s loglines with its rollout in February of Tell Me More, designed to describe an advisor’s value proposition in 15 words or less.

“It’s how people sell screenplays to agents. It’s selling the most compelling, concise points of the movie in 15 words or less,” West said. “You’re trying to get the client to say the most powerful three words in marketing: Tell me more.”

Rather than using a “boom box” approach by touting your experience and how much money you manage, West advocates a “boomerang” approach based on four core principles: Keep it positive, in plain English, plausible and personal. West’s own value proposition: I help advisors keep and grow assets with their best clients.

“Remember the elevator speech? The elevator speech is flawed because there is no building tall enough in the world to accommodate an elevator speech. Tell Me More is not done in an elevator; it’s not done in three minutes. There’s never a speech. There’s a conversation,” he adds. “People have got to try to differentiate themselves and you can’t do it by the numbers. There’s no safety in numbers. You’ve got to do it through a succinct, compelling message that drives the client to say: Tell me more.”

Identity: Hiring is picking up in the industry and consultant Angie Herbers says employees increasingly are looking for an employer of choice.

“It’s bigger than brand, bigger than marketing. They’re looking for an identity,” says Herbers, founder of Angie Herbers Inc. “It’s very much like a city. What city are you: Las Vegas, New York, San Francisco? What makes you a destination employer?”

It’s tough to quantify “identity” and there are no systems to make the process scalable. As Herbers puts it: “It’s almost like you have to show them to see it. You can’t fully understand Las Vegas unless [you go] to Las Vegas.” To start, Herbers throws out all clichés (“We’re a fiduciary” or “We’re a comprehensive financial planning firm”) and goes right to the client service model — and to the clients.

“I have one advisor who works with business owners and we said to his clients: What do you value about this? It wasn’t the financial planning process at all. It was the fact that the advisor is a business owner with a business mind. They realized that the owner of that company had something different than anyone else,” she said. “That’s why they were clients.”

 The advisor no longer recruits or puts postings on CareerBuilder. Potential hires come to him.

“I can walk into that firm and I can feel the difference,” Herbers adds. “This is how you get an engaged employee and an engaged client. All clients want in a service business is a connection. They care about all the other stuff you do but the connection is the most important thing. It’s all about being true to your city, your inner core.” 

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