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Retirement Planning > Retirement Investing

The Successful Retirement Plan Advisor, Pt. 4: Profile in Success—Plan Sponsor Advisors

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This is the fourth in a five-part series defining success for retirement plan advisors by Liz Davidson, who as president of Financial Finesse has a unique vision of who the most successful retirement plan advisors are, and what they have in common.–Ed.

I’ve talked a lot in this series about the key role of innovation in growing a retirement plan advisory practice. There’s another side of the success story that’s equally important and sometimes even more difficult to accomplish: implementing that innovation. Many advisors may have the foresight needed to stay afloat in this industry—they pick up on trends in their clients’ planning needs and network with other professionals who collaboratively help them identify where the market is heading. But the implementation process is where many of us entrepreneurs go wrong. Some have a great idea that either never gets played out into real practice. Sometimes the idea does get implemented, but in a way that doesn’t resonate with your target market. As a result, many opportunities to grow our businesses and stand out in this crowded industry are lost, and then—lo and behold—someone else comes along and does it more effectively.  

Jennifer Flodin of Plan Sponsor Advisors.There is, however, a unique way to approach the implementation of new ideas in one’s business which any advisor can use. A firm that has successfully used this approach for 11 years is Chicago-based Plan Sponsor Advisors. PSA specializes in advising mid- to-large-market plan sponsors around plan design, like payout options and automatic features, to the communication and education efforts around the plan to increase employee participation. This boutique firm has been able to advise clients on over $19 billion in assets and is one of the most recognized advisory firms in the nation. They’ve been able to not only see ahead of the market, but also how to develop and position new services that met market needs before others were doing it. Jennifer Flodin (left), co-founder of PSA, credits these traits for the success of her business.

In a nutshell, PSA’s approach is to think about its business long term, position its services, communicate with clients and develop partnerships. No matter how innovative the ideas or how wonderful PSA’s services are, Flodin and her partners know they won’t get across to clients unless they implement them well. Here are some tips any advisor can use to better implement new ideas to meets client demand and elevate their practice to national status:

Put your services in a framework that makes things easier for your clients. 

Countless behavioral science research shows that putting information into a framework helps us better identify, relate to and understand it. The problem is that creating frameworks which resonate with our target market is much easier said than done.

I’ve personally come to realize that there is a delicate balance between making things simpler for clients and coming off as too simplistic. Advisors face this with their own services—frameworks can  make our businesses come across as “cookie-cutter” with no room for customizing to the client’s specific needs.

But Flodin and co-founder Don Stone (right) have masteredDon Stone of Plan Sponsor Advisors. the use of frameworks to grow their business.  PSA has seen their business grow 26% since implementing their R21 framework which gives plan sponsors four main action steps that PSA will accomplish upon being hired to consult with them on their plan: re-think, re-invent, re-design and re-engineer. Their framework simplifies their services for clients without sending the message that what they do is simple or that it is a one-size fits-all proposition. For tips to creating frameworks, see sidebar in this article.

Create a business model that allows you to provide high end, customized service in a highly efficient, scalable way. 
Sure, customizing for every client sounds like a far-fetched fantasy that has no room in the real world. It’s probably the biggest challenge we face in running a business and it sure doesn’t lend itself to highly scalable, efficient operation when done the traditional way; we would never grow simply due to capacity issues. 

But customizing on a mass scale is actually very doable. The problem is that there’s often something holding us back: we tend to look at parts of our business as silos rather than as interconnected. My own firm has been guilty of having this mindset, starting with a blank sheet of paper when working with a new client rather than seeing parallels in past or existing relationships. Whenever you fail to see those parallels, you miss opportunities to fully leverage what you’ve already done successfully.

Changing the way you see customization can revolutionize your business. This is where PSA has done the most in terms of business growth—the firm looks at every client, every product and every service as interconnected.

PSA recognizes where there is overlap and how a previous experience can be altered to work for another client or put into a framework that makes it a highly desirable service with the mass market.

PSA has used its frameworks as a roadmap for customization, allowing the firm to personalize every single operation while still scaling its business. You can do this by creating or outsourcing the resources, metrics and tools that help you customize.

For example, take assessments that lead clients to customized recommendations or a personalized plan based on answers they provide. You can then help guide clients in the right direction to services you already provide. Another example is a tool PSA created called TDAnalyzer after noticing that clients were repeatedly expressing concerns about target date funds. The tool evaluates whether a target date series was likely to result in success for a particular plan’s participant base, as defined by replacing a percentage of income. PSA had recognized that the traditional ways of analyzing target date funds were incorrect and plan sponsors were not meeting their goals as a result, since target funds are explicitly designed to reach a goal by the target date and thus can’t be accurately measured based on performance. Using this tool, PSI provides clients with customized consulting while making the customization process easier to manage and less time consuming.

No matter how ahead of the curve your vision is, you won’t be able to capitalize on your ideas without an implementation strategy that turns them into real-life solutions for clients. What PSA has done so well is operate with the right approach that allows them do have the best of both worlds: preserving their boutique approach to client management and providing them with high-end customization, while also being able to implement innovation through mass-scale services to grow their business. This balance is the reason their firm is able to manage over $19 billion in assets and it’s something every firm can do if they approach their growth the same way.


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