I have a pet peeve.

For those of you who know me, it won’t surprise you that my pet peeve is centered around the implementation (or lack thereof) of a strategy. As we all know, ideas are a dime a dozen. It is the implementation of an idea that sets it apart from everything else.

So that said, often when I hear the words “Business Plan,” I usually feel a wave of displeasure sweep over me which I then shake off with a scowl on my face and perhaps some foul language uttered under my breath for good measure.

Why the reaction?

Well, consider what happens with probably 90% of the Business Plans that financial advisors prepare annually. This is a probable scenario—it is late December and you start to wade through the 20 to 40 pages of the business plan that your company provides for you and perhaps even requires you to complete.

You pick at it over a few weeks, and then with the deadline looming, you set aside a couple of hours and plow through the document as quickly as you can. A sense of relief rushes over you as click the “save” button and send it off to head office. You may even print a copy which you sit marveling at for a few minutes before you file it away in a drawer never to be seen again. Well, at least until next year when you may use it to help you figure out what to write on the next year’s Business Plan.

Regardless of my reaction and the usual scenario, Business Plans can have value if they are referred to regularly and adjusted as needed. Are you meeting your targets? What can be done to bring you back on track? What needs to be adjusted in your business to ensure the desired outcome?

What changes have to be implemented with your clients? Simply reading over the plan can create awareness of your shortfalls and can ignite a flood of ideas that can be used to get you back on-track for the year.

Each new item requires some planning for implementation and then the necessary steps to be taken to actually bring the idea into fruition within your business.

Right now we are approaching the Labor Day weekend. When I was in school, I always considered this a new opportunity—a new beginning if you will.

It always seemed to me like it was a second New Years and I had the opportunity to evaluate what I wanted to accomplish over the next 8 to 10 months. I still feel that way to some degree.

This is the last opportunity to dig in and evaluate whether or not I will achieve my goals for 2010. There are really only three months left before the holidays begin and before you know it you will be looking at the business plan for 2011.

This is the time you should take a couple of hours to review what you wrote last January and make some decisions on what you can do right now. I guarantee that by just even reading it over, examining what you wanted to implement, and considering what you actually did, will make a huge difference in the final three months of this year and ultimately for years to come.

As an example, in the Pareto Platform powered by Microsoft Dynamics CRM, I wanted to provide a document that was simple and easy to use and that would prompt a regular review and adjustment to whatever course of action one happened to be undertaking.

This new Business Plan will be released in a couple of weeks. It is complete and thorough, and allows the advisor to review what they have written, and make adjustments as needed.

Every time the document is changed it archives what was previously written. Over the course of a year you may end up with 3, 4, or even 5 versions of your business plan as it evolves.

They will all be a progression from one to the other. Your course of action can be tracked and accounted for and your business plan can become a process for planning and implementation.

And perhaps the next time I hear someone talk about a business plan, the conversation will be around how it has become a constant and invaluable reference point for their business, as opposed to something that is filed away and forgotten.

For questions and comments join the Pareto Systems Group on LinkedIn and participate in the discussion.

Take Action

Visit www.paretoplatform.com to watch the video overview of the new Pareto Platform powered by Microsoft Dynamics CRM. Call 1-866-593-8020 to sign up for a free trial.

Team Meetings

Ever walk into the office some days and not know where to begin? With so many activities on your organizer, client appointments, emails in your inbox, and practice management on the brain, it’s no wonder. And, before you know it, someone is at your desk interrupting you. The next thing you know, you’re at their desk interrupting them. Even worse, by Friday you wonder exactly what it was you set out to accomplish this week. Never mind what next week holds. Sound familiar? If so, you are not alone.

This is a good example of a financial practice lacking a formalized team communication process, relevant and frequent progress assessments and predictable leadership. This type of team environment is a breeding ground for miscommunication, lack of focus, employee dissatisfaction, inability to achieve your vision and operational errors (some of which are in plain sight of the client and directly impact your credibility). All of this can be solved with the creation of a regular weekly team meeting. Really: we are serious. A weekly team meeting provides leadership through a formalized team communication process, which enables relevant and frequent progress assessments. There is no down side here.

Now, when it comes to having a weekly team meeting, pick a day and time that will work for everyone on a regular basis. You shouldn’t need any longer than 30 minutes. Next, use your CRM to effectively time block your team meeting time for everyone, for the rest of the year. This is a high priority activity. Finally, be sure to use an agenda to ensure efficient use of everyone’s time. The agenda should cover regular business activities (client related and operational), as well as any practice management projects you are working on. Remember, out of sight, out of mind.

Creating this once-a-week communication structure allows everyone to be ‘tuned into’ the practice and know what’s going on. This dramatically improves the probability of achieving your vision. It also reduces the amount of daily interruptions. Some Advisors have their team keep a copy of the agenda and as relevant items come up, they simply add it to the agenda and bring it to the next meeting. Nothing gets lost and interruptions are minimized.

Remember, your team will treat this weekly meeting with the same level of importance you do. Be consistent. Make it relevant. The agenda must be purposeful. With this in place, you can lead your team to success by providing them weekly direction, holding them accountable, while also empowering them to look after their designated roles and responsibilities. You will have a greater degree of control in your practice and a heightened awareness of what is actually being accomplished.

Whether there are 2 or 10 people on your team, if there is only one thing you do this quarter – do this.

For questions and comments join the Pareto Systems Group on LinkedIn and participate in the discussion.

Take action:
Visit www.paretoplatform.com to watch the video overview of the new Pareto Platform powered by Microsoft Dynamics CRM. Call 1-866-593-8020 to get your name on the free trial list.

Are You Too Technical With Your Clients?

By David Miller

Recently, I started working with a new coaching client, and within our first few conversations, I asked her what her process was for meeting with a prospective client for the first time.

After about a five or ten second uncomfortable pause (which is about the norm by the way), she proceeded to launch into a speech about asset allocation, and a variety of other technical things, that for me, was like watching paint dry, except it was that special extra slow-drying paint.

Normally my reply would be far more polite than what I said to her; however, this was a terrific lady who had insisted I be brutally blunt with her about everything she did. “That’s why I hired you!” she told me in our first conversation.
With that being said, and with silent apologies to my Mother, I replied: “Suzanne (not her real name), I’m sorry, but you are putting me to sleep.” There was a nervous laugh from her, and I continued to say: “I am sure that there are some people out there that would find that level of detail interesting, for instance, someone who liked to read advanced calculus in their spare time, or perhaps another Financial Advisor;” however, that is not me, and I think that the majority of laypeople are the same way.”

“We come to hire the services of a Financial Advisor, and we pay for it, because we are ill-equipped to do it ourselves, and we want to make all that complication go away, not intensify.”

I used the analogy of a plumber with Suzanne, and I asked her if she had ever hired one before. She replied: “Yes actually, I had a plumber in about three-weeks ago because we had some leaky pipes in the kitchen.” I said to Suzanne: “You hired the plumber to come in and solve the problem I know, but did you want him to show you every tool in his toolbox and explain what each of them did? Did you want a play-by–play of his every step or did you have better things to do?” She laughed, and said: “No, hardly. I just wanted him to fix the problem and give me back my kitchen as soon as possible.”

Suzanne also sent me examples of some email blasts that she sent out bi-weekly to clients. I am on many of my clients’ email lists, and a large percentage of the emails I receive from Financial Advisors run afoul of this same aforementioned transgression. You know the ones I mean: “Technical Trends Show a Robust Year for Oil!!” and so forth.

Another of my clients wanted a critique on the emails he was sending out. I try to keep an open mind with such things, but just like Suzanne, I was having immense difficulty deciphering what it all meant. You see, I have a Financial Advisor who makes all of that stuff go away, and I pay him well for it. I am not well-versed in the subject as a result, and nor do I wish to be. Like Suzanne, he wanted the unfettered truth, so I said: “Well, it reminded me of a Doctor sending out an email with instructions on how to fix my own broken leg, when really, I just want the Doctor to fix it, and with as little pain as possible.”

What then should you discuss in your first appointment with a new client? We recommend an agenda-driven meeting that covers a short talk on who the advisor is, what the company is, a high-level view of how the advisor is compensated and of course a description of the advisor’s approach.

Re the ‘approach’ aspect, which is typically where things start to get too complicated, we encourage advisors to use the language of Critical Financial Events. These are things that can impact long-term goals and objectives of the client. What are Critical Financial Events? Critical Financial Events are anything to do with money, especially those things that might necessitate an adjustment in the overall strategy. I like this a lot because it took me about 30 seconds to understand it. Your clients will like it for the same reason, plus, they will start to recognize Critical Financial Events happening all around them, and where they didn’t previously.

The job of the advisor therefore, is to understand the overall goals and objectives of the client, and then and then to navigate the client through all of the Critical Financial Events of their lives, adjusting and readjusting the plan when necessary, in order for the client to get to their goals and objectives in a reasonable amount of time.
Do you think that this is too simple? Too dumbed-down? Try it and you will see differently. Remember, you are immersed in that technical world, and you are a Financial Advisor. You see things differently because it is your world, but it is not mine, and it is not your clients. Your clients will sit and nod politely when you start to get too technical, but don’t think for a second that the majority of them understand.

We have been using this precise approach with Financial Advisor for over ten years, and they have been using this simplified language with their clients. Advisors have told me more times than you can count that clients have come back after just one or two meetings, already using the language of Critical Financial Events themselves.

Think of the one or two clients (maybe more if you are lucky), that when you ask them about a technical issue or something that you are thinking of doing with their account, and they reply: “Oh David, whatever you think. You know we trust you.” Aren’t those clients the absolute best? Those types that empower you fully with their trust, that never hassle you, and that couldn’t give a fig about the technical side of things?

I ask you to envision this scenario: What if you had a hundred clients just like that?

Take action:
Visit www.paretoplatform.com to watch the video overview of the new Pareto Platform powered by Microsoft Dynamics CRM. Call 1-866-593-8020 to get your name on the free trial list.

Fixating on Technology more than People

In the era of the Blackberry, iPhone and other technical culprits, we often encounter advisory teams that have become extremely adept, and yet somewhat over-dependent, on these technologies and others like them. I am as guilty as anyone in this regard, but I do work on changing that reality.

People are indeed communicating with each other more than ever, but is it quality communication? So much of how we interact with each other is non-verbal. Emails, texts, etc. are largely depersonalized missives that move quickly back and forth, but to what end?

The risk inherent in all that technology is the lack of development of good, old-fashioned people skills. The more technology creeps into our lives, the greater the importance of face-to-face conversations, meetings and meaningful personal contact.

When you make a habit of cutting back, or abandoning altogether, non-essential technologies, this allows for the natural occurrence of better relationships within your team, a lesser chance of misinterpretation, and the continual honing of your team’s people skills.

Clearly your team will benefit from this, but it is also a certainty that your clients will too.

It wasn’t too long ago that none of these devices existed, and yet the business world still chugged along mightily, just like it always has. Instead of firing off emails and texts from a secluded room, team members actually had to interact with each other, and even look each other in the eye!

In the old days, as you know, a business deal used to be sealed with a handshake. I often wonder if there is any connection to this, and the fact that none of these technologies were in place at the time.

I realize that ‘old-fashioned’ face-to-face interactions still occur of course, but to a far lesser degree. I will say that when we do have face-to-face interactions, it sure seems like the chance of misinterpretation is by far to a lesser degree because we can see the body language unfolding in front of us, and we can experience the correct emotions that support the message. These are things that are integral for proper understanding of what is being said.

People sometimes forget that sound ‘people skills’ are practiced and developed skills. The less opportunities we have to ‘practice,’ the less these skills improve.

By no means am I suggesting that technology is all bad; Pareto Systems is primarily a CRM company after all. Our flagship product is the Pareto Platform: a CRM made exclusively for advisors. In fact, we even go as far as to say “No advisor’s office is complete without it!”

Before I start sounding hypocritical here, the difference is that the technology behind the Pareto Platform enables an advisory team to create processes using the onboard business development suite, and then automate those processes so that everyone no longer has to keep track of 20-30 things up in their head. This is highly significant from a communication perspective.

The end result is a whole lot more time and freed-up mindspace to do the things that you and your team need to do to enhance your team chemistry and your client relationships, and to build immense trust in the process with both groups.

Without our heads swimming in the minutiae of the typical business day, and by automating in this way, we are able to spend far more face-to-face time with top clients, focus on team relationships, and in short, create a consistency of superb communication that is unmatched.

Technology isn’t evil, there just seems to be good and bad ways to make use of it. Try to find the right balance within your team, and who knows? Sending fewer emails might just get you a referral or two!

For questions and comments join the Pareto Systems Group on LinkedIn and participate in the discussion.
Visit http://www.paretoplatform.comto watch the video overview of the new Pareto Platform powered by Microsoft Dynamics CRM. Call 1-866-593-8020 to get your name on the free trial list.

It is one thing to be honest, and yet another thing altogether to be both honest and forthright.

I often use the example of when I first started in this industry. In those days, mutual funds had a 9% front-end load. Most advisors today would shudder at the prospect of having to tell their clients that they would lose 9% of their investment the moment they wrote that check.

As I honed my sales skills in those early days, I learned rather quickly that if you told the prospective client this unpleasant news at the end of your presentation, 90% of these people would politely (and some not so politely) run for the door never to be seen again.

I also discovered that if this news was the first thing you told people, as opposed to the last, 90% of those people did not consider it a negative aspect of doing business with you.

From that point on, when I had a prospective client come into my office, or I met them in their homes or offices, the first thing I would say is: “It is important to let you know that if and when you decide to do business with me, all your investments will be subjected to a front-end load of 9%. What this means is that if you write me a check for $100,000, the amount of $9,000 will be paid to the mutual fund company. A portion of that will go to the investment company I work for and a portion of that will go to me.”

I remember the first time I tried this; I stopped after that statement and waited for the usual request for me to leave the premises immediately. It was a bit like waiting for someone to pull the trigger of a gun. After a brief pause, which seemed like an eternity, the gentleman said: “Well, let’s see what kind of investments you’re talking about.”

I almost fell off my chair. Of course I had been taught to tell the truth but this was a new wrinkle in the formula–being both forthright and honest right up front.

There are many ways you can apply this simple principle. At Pareto we often talk about advisors taking more time off to enjoy their lives. Many advisors are reluctant to do this and when they do take time off, they are even more reluctant to tell their clients. Is it possible that if we communicated to our clients well in advance about our vacations they would be respectful and understanding of our needs as well as their own?

So we are now into July, 2010. Many of you have your holidays planned and for some of you they are imminent. How good a job have you done communicating this in a forthright and honest way to your clients, or perhaps even your staff?

Many of the advisors we have worked with over the years send out a letter at the beginning of the year outlining the holidays they will be taking. Some even discuss where they plan to go and what they will be doing. Some even include it as part of their newsletter. When they get back from their holidays they may even share some of the highlights of the vacation.
Clients appreciate this and some even get excited about your prospects for your time off. You may be going somewhere or doing something that is near and dear to their hearts. Or, they may have suggestions of particular activities or locations that they have enjoyed in their travels. Ironically, this can make you more interesting to your clients. Instead of your clients resenting your activities, they respect it and enjoy hearing about it. Of course this all depends on how forthright you were with them.

One last story to make my point; about 15 years ago, I listed a house with a real estate agent. The next week I called to talk to him about his plans to market the house. His assistant notified me that he had gone on holidays for two weeks. I was quite disappointed and put off by this discovery and asked her if perhaps it would have been reasonable for him to tell me this. She was non-apologetic.

Over the next couple of weeks, she called me several times to ask me if I was available to show the house to prospective purchasers. This was the proverbial salt in the wound. When he returned and I expressed my feelings he was indignant that it was his right to take holidays and had had them planned for months. Needless to say, he had completely missed my point about simply communicating more effectively to his clients. Fortunately I had listed the property for only 3 months. When he asked to renew the listing, I literally laughed out loud.

How differently could have that relationship evolved if he had been forthright? If he had explained that he had a vacation planned when I met with him for the first time, how would I have reacted? When he returned from his holidays, I am sure I would have had a conversation about his trip and not about his lack of communication skills. The property sold a few weeks later. He lost about $25,000 and any chance of a recommendation of his services.

If you haven’t been forthright about your summer vacation, consider how you can put a process in place to better communicate to your clients about your next holiday. You will be surprised how much they appreciate it.

For questions and comments join the Pareto Systems Group on LinkedIn and participate in the discussion.

Trying to come up with effective Client Service deliverables can often be a challenge. When crafting a Client Service Matrix, your prime directives should be first of all, coming up with something that is meaningful, and secondly, coming up with something that you can fulfill on a consistent basis.

The consistency issue is all-important. As a rule, people crave consistency. In fact, it is one of the ways we make sense of our world. You can come up with the greatest service deliverable ever, but if you put it into action, and then stop later on for whatever reason, you have lost any momentum that you gained in the first place. As the client, I may have enjoyed the attention when you first started, but if the service I initially received “stops and starts,’ you have gotten nowhere with me in terms of making me feel comfortable about referring you. Would my friend or family member receive the attention I once received? Who knows? Not me. I’ll just hold off on referring for now until you figure it out.

When we work on the Service Matrix with our consulting clients, we often recommend that they include ‘Articles of Interest’ as a service deliverable. This is something that is extremely low cost, and very easy to do.

Keeping in mind that this is really only for your top clients, the idea behind Articles of Interest is to print off an article every so often that is of interest to a particular client, and then send it out to the client by mail to show that you are paying attention to your clients’ lives.

It’s important to know that in this instance, I am not recommending that you send out articles having to do with financial planning or the markets etc. What I am asking you to consider is to send out articles based on your client’s F.O.R.M information (Family, Occupation, Recreation, Money), and in this case, just zeroing in on Family, Occupation and Recreation.

The easiest way to do this is to start building a folder of websites having to do with your clients’ interests. Some clients may have rather eclectic tastes such as bird watching or bee-keeping, but as you know, the Internet has a knack for catering to just about anyone. That said, the usual suspects that many people gravitate to are things like travel, wine, cooking, golf, sports, and so forth.

Next, you then need to program a recurring activity in your Pareto Platform, or whatever CRM you happen to be using, for the Articles of Interest to occur semi-annually. Twice a year is plenty. When the activity shows up on the appropriate team member’s calendar, the team member briefly reviews that person’s F.O.R.M. information, goes to a relevant website, and prints off an article on nice paper. Conveniently, websites are very good for refreshing their content regularly.

The advisor then needs to take a post-it note, or a small piece of stationery, and write: “Dear Bob, saw this and thought of you.” or “Dear Mary, thought you might enjoy this.” You get the idea.

When sending these out, try to refrain from using office envelopes etc., for it tends to come across as lazy. Instead, it is highly recommended that you get some colored envelopes, hand-write the person’s name and address, and use a real postage stamp. Don’t run it through the postage meter.

If you are consistent with this, the client will eventually start to look forward to your missives, and yet it will still appear to be a spontaneous gesture. Clients will learn to spot your telltale green envelope in the mailbox, and rip it open. Because we live in an era of sorting the daily mail over the recycle bin, a letter sent out in this fashion will always be warmly received.

I don’t know about you, but the last thing I want to read at the end of a hard day is an article on dollar-cost-averaging or trends in the stock market. I have a Financial Advisor that takes care of all that for me anyway. But what’s this I see in the mail today? A green envelope holding a recipe for the “Best Ribs Ever?” Yum. My advisor knows me all too well.

For questions and comments join the Pareto Systems Group on LinkedIn and participate in the discussion.

Not too long ago, I was working with a new client who had been an advisor for about eight years. She was a lovely lady from Calgary, Alberta, and one day, we had been working on how she could become better at capturing and chronicling personal information about her best clients’ lives.

Many of you who are familiar with Pareto know that we call this type of information F.O.R.M., and it is some of the most valuable information you own. F.O.R.M., for those of you who don’t know, stands for Family, Occupation, Recreation, and Money.

Most Advisors we encounter have the ‘money’ part sewn up pretty well, but few in our experience take the time to put systems in place to keep track of the other three so that it truly becomes part of your integral day-to-day interactions with clients, and eventually, the crown jewel of your intellectual property.

Any one of your staff that deals with your clients, either face-to-face or on the telephone, uncovers these tidbits of information on a regular and daily basis. Clients are telling you and your support staff about their family, what they did on vacation, how their hobbies are coming along, etc. etc.

The problem is, if there is not a categorized way to efficiently organize this information, in a way that everyone can add to it, access it easily, and therefore benefit from it, the information dissipates into thin air over time. This is unacceptable.

How does this type of activity impact your next paycheck?

Well, in a couple of ways. First, it keeps your paycheck intact. When the markets are plummeting, for possibly an extended period of time, what keeps your clients from being courted and lured away by competitors? It is the relationships with your clients. If the personal connections aren’t there, why wouldn’t I take a chance on someone else promising better returns? F.O.R.M sees us through the good, and the bad times, and helps us weather the storms.

Secondly, the relationships you have with your clients are deeply entwined with how referable you are. If I am your client, and you regularly ask me, with precision, about all the ‘intimate’ details of me and my family’s life, I know you are for real, and I trust you. I am going to be far more likely to refer that kind of person than someone who approaches this kind of thing haphazardly, or not at all.

I hope you would agree that those are two pretty good reasons to become more serious about this with you and your team. Here are some key points that will help you become more efficient with capturing and chronicling F.O.R.M.

1. Your Contact Manager needs specific buttons to match the categories of Family, Occupation, Recreation, and Money. When client information is uncovered, it is put in its specific category, so that relevant information can be accessed when you need it, and in a pinch too. Those of you who simply throw all of this stuff in a Notes section in your Contact Manager know all too well how cumbersome, and eventually useless, this approach can be. After a couple of years, you will develop carpal tunnel syndrome from the endless scrolling that is involved trying to find the specific information that you need.

      2.   F.O.R.M. is a team responsibility. Anyone on your team that converses with clients on the phone, or face-to-face, must put anything they uncover about your clients in its specific category. If they do not, the other team members will be oblivious to this knowledge, and can therefore never benefit from it. Your front lines are uncovering gold on a daily basis, and if they do not capture it, your intellectual property, and really, some of the most important information you will ever own, vanishes into thin air. The same thing applies in reverse as well with the information that you are uncovering.

As I was discussing these very same things with my client from Calgary, and the benefits inherent with these disciplines, she admitted that she had never been particularly attentive to these matters in the past. She was far more on the technical side, and she was very good at it too.

She then stopped for a second and said: “You know, it’s funny, as we are talking about this, I was thinking about my colleague and friend from Toronto. We went to school together, graduated at the same time, and we work in the same capacity for the same company. I was just thinking about her, and she is someone who has always been excellent at this type of thing and has done it for years (F.O.R.M), whereas I have always concentrated more on keeping my clients educated on the Financial Planning side. My conversations with my clients are typically financially oriented, whereas she always laughs at me when I tell her this, and says that her conversations with clients are seldom about money. They just empower her to do whatever she needs to do, and in the meantime, all she does is this type of thing (F.O.R.M.).”

She then added: “Do you know what else? She has beaten me in production every single year since we started.”

For questions and comments join the Pareto Systems Group on LinkedIn and participate in the discussion.

Take action:

Stop by our booth at the Securities Industry and Financial Markets Association (SIFMA) Financial Services Technology Expo in NYC June 22-24 for a one-on-one demo of the Pareto Platform powered by Microsoft Dynamics CRM.

Why do people refer a professional to their friends, family, or people in their inner circle? Usually when I am discussing this topic with Advisors, invariably the answer the Advisors come up with is that “they want to help that person.”

I don’t deny that this is probably true, but our belief is that the motivation is more ‘selfish’ on the part of the person that is referring. Yes, they want to help their friend or family member etc., but ultimately they want to hear back from that person, and they want to hear validation about the recommendation in question. That is true whether or not it is a Financial Advisor they referred, or a good book, or even a terrific bottle of wine.

Just as giving to charity makes us feel good inside, having someone come back to us and say: “Thanks so much for introducing me to John, he is a true professional” or “That book you recommended was amazing, thanks,” go a long way to validating the choices we have made in our own lives. We want to share the special things we have discovered. Put simply, when we get the positive feedback at the end, it feels great. We are also doing a good deed in the process, so let’s call it ‘enlightened self-interest.’

I mention all this because when someone has just signed on with a new Advisor, the new client’s propensity to refer that same Advisor to someone else is at its highest right at the very beginning. That said, this last fact is entirely dependent on the Advisor’s process for how that client was brought on at the beginning.

Did the Advisor use an agenda when we had our first meeting? Or did he take notes on a legal pad? Was there a pre-appointment process that made me feel I was heading into something special before I even met with the Advisor? Or did he see me within two days of the initial contact, projecting absolutely no scarcity in the process? When the papers were signed, what happened then? Did the Advisor just move on the next conquest, or was there a New Client Welcome Process that continued to validate my decision to work with that advisor?

All these things in concert with one another create an experience that makes people want to share the experience with someone else, and right off the bat too. If the Advisor is consistent with all of those things, and the person that I refer has the exact same experience that I did, I know that person will come back to me, and they will say: “Wow, it was just like you said. I wish I had done that five years ago.” Of course that makes me feel special, and the feeling I get is that I want to do it all over again with another friend so I can get that same emotional payoff. Better yet, now I am even more assured of the Advisor’s consistency because of the feedback I received. As a result, I am even more confident about referring someone else!

Examine your process for taking on a new client. Is it memorable? Would you refer someone into your process? Would you be confident that you would get glowing feedback from the person you sent there? These questions and answers have huge implications as to the number of referrals you receive.
If you don’t have a pre-appointment process, start one. Make it good and stick to it; you know, just how the dentist does it. Send out a letter, an Introductory Kit perhaps, and then make a courtesy call the day before the appointment as a reminder.

If you are not using agendas, start! Decide on a nice welcome gift that is sent out when all the paperwork is signed, and then be consistent with it. Also, when selecting an appropriate welcome gift, don’t pick something that looks like you walked approximately 20 feet down to the company gift shop. Make it seem as if there was some effort, and that will reflect that you genuinely value your new relationship with that person.

From what I have seen in my experience, this type of attention is so rare in today’s business world, that if you decide to get serious about some of the things I am discussing (hopefully all of them), people will be referring you all over the place. When you exceed someone’s expectations, not only will they contrast it with their prior experiences, they will tell others. It is basic human nature, and we all do it.

For questions and comments join the Pareto Systems Group on LinkedIn and participate in the discussion.

By David Miller

Have you ever wondered why you get more referrals from your mid-tier and lower-tier clients than from your best clients?

Most people chalk it up to the fact that their top-tier clients are less approachable. Some say that these people are an anomaly and they really don’t know anyone else with as much money as they have. Others point to the fact that people with money really don’t ever talk to others about their money and want their privacy. I have heard advisors make every excuse possible for their “best” clients and why these people don’t introduce their friends, family and associates to their services.

Consider the following: Most advisors we talk to have between 200 and 500 clients. They have done some type of client classification so they recognize who their best clients are and who their worst clients are, but the service they provide still tends to be reactive rather than proactive. When we analyze these advisors’ time we discover that the time they spend with a client tends to be about the same for everyone—at least the top 70%. So each and every client in the top 70% gets roughly the same amount of attention. Sure it takes more time to prepare a proposal for top-tier clients and you may take them to lunch once a year or give them tickets to a sporting event. But the time you spend with them tends to be very close to the same as your mid-tier client. So in other words the 20% of your clients that are generating 80% of your income are getting about 20 to 30% of your time. Does that sound fair? How would you feel if you walked into a lawyer or an accountant and they looked at you and said, “I realize that the retainer you pay me makes up 50% of my income but I have decided to provide you with about 20% of my time and use the other 30% to help my less prosperous clients.” What would your reaction be? Does that sound a little unfair to you? Well, that is exactly what most advisors are doing.

So now consider your mid-tier clients. As a mid-tier client it is exactly the opposite scenario. You walk into your lawyer or your accountant and they say, “I know you only pay me for 10% of my time but I have decided to actually provide you with 30% of my time out of the goodness of my heart”. How are they going to react? Well they will be pretty excited by this and just might tell anyone who will listen how great these people are and how they too should go see them whenever they have an issue that they may be able to address.

The last objection I hear when I present this argument is that the clients don’t know what percentage of time you are spending with them versus your other clients. This could not be more wrong. Your clients know exactly what they mean to you in terms of revenue and they also know the time you spend with them with respect to everyone else.

As we make the necessary adjustments to an advisor’s practice so that they may provide their clients the level of service they deserve, we here responses like: “It’s about time!”, “I was in the process of looking for a new advisor but I really like you and I am glad you have finally started giving me the attention I deserve”, and “I never understood why you were so busy and I am glad you have more time to focus on me now.”

How could you expect anyone that is harboring these feelings to even consider recommending you to anyone else?

Examine your client list, see where you are getting your referrals and make a plan to change your top-tier client experience today!

The Pareto Platform allows you to design a service matrix that guarantees that the 20% of your clients that generate 80% of your revenue get 80% of your time. Does your CRM have that capability and what would it mean to you and your practice if it did?

No advisor’s office is complete without it.

For questions and comments join the Pareto Systems Group on LinkedIn and participate in the discussion.

Take action:
Stop by our booth at the Million Dollar Round Table Conference in Vancouver June 13-16 and the Securities Industry and Financial Markets Association (SIFMA) Financial Services Technology Expo in NYC June 22-24.

By David Miller

It probably goes without saying that it is always a good idea to thank our advocates.

Your advocates are those people that rave about your services. For them, it truly is a kneejerk reaction to talk about you each and every time the topic of money or advisors come up.

Advocates understand your process for introducing other individuals like themselves and they follow that process out of respect for you and respect for their friends, family and associates. If they don’t mention you and your services they feel they are doing their friends a disservice.

Advocates see the opportunity to introduce someone to you as a service you provide to them. They don’t consider it a favor to you and they understand that everyone doesn’t become a client. It is a process of determining if there is a mutual fit and they know that anyone who is lucky enough to become a client of yours will be considering it as an accomplishment.

You might now be thinking: “Wow, do I even have any advocates?” Most likely you have a few and of course by following our program you can have many more.

Regardless, lets get back to the topic at hand. What do you do when an advocate calls and introduces someone to you? Your primary objective is to reward the activity and not the outcome. Your client has just made the effort to pick up the phone, call you, and proceeds to tell you about someone they know who they feel needs your services. After a call like that, and I am sure that during the call they rave about your services and the relationship you have with them—is it sufficient to simply say thanks and hang up the phone?

We recommend that you send them a card; the nicest card that you can possibly find. In the card you write a short note addressing the action and thanking them for the trust and confidence.

“Bill, Thanks again for the trust and confidence you have demonstrated in the services I provide to you. I am looking forward to meeting Sally and Bob –they sound like interesting people. We will see you next week at our semi-annual review. Sincerely, David”

This is not an elaborate gesture, and nor does it have to be. It can be very simple. It is always nice if you can refer to something personal about the existing client but the most important thing is that you are thanking them for the relationship that you both share, and the trust that they feel in the services and the advice that you provide. You are not thanking them for the business!

The question often arises: “Should I let my client know if the referral becomes a client?” I don’t think this is relevant. In doing so, you run the risk of appearing to thank them for the business, and you are slipping back into the role of a salesperson. The perception is that you just found someone else to sell to, whether that is true or not. Professional advisors recognize that one of the cornerstones of trust is congruency, and by placing the value on whether or not the referral becomes a client is not congruent.

So remember: take the time to thank your advocates and then make sure your note refers to the activity and rewards the client for what is truly important—a long-term trusting client.

For questions and comments join the Pareto Systems Group on LinkedIn and participate in the discussion.