Gerber Has The Right Idea
Evan Simonoff, you don‚t get it.
Michael Gerber is correct (Financial Advisor, March 2007), and your assertion that he is not is wrong. TD Waterhouse‚s success proves it. Through structure, systemization and marketing, TD is picking up market share and eating its competitor‚s lunch. Its CEO, Joe Moglia, has demonstrated that he can build an organization that transcends the individual broker. And if anyone says it‚s just price, they are sadly mistaken.
I believe that there are just an awful lot of technicians who are quite content working IN their practice rather than building a real business, and that is OK, I guess, but I never understood that. When I was in retail I remember my Dad yelling at me once when we were building our fifth or sixth store, "Did it ever occur to you that we would all be happy with just one location?"
And honestly, it didn‚t. As he is wintering in Naples, I am pretty sure he no longer feels that way. Gerber, although crass, is right.

John Macco
Macco Financial Group Inc.
Green Bay, Wis.

What Is A Fiduciary?
I enjoyed your perspective on Michael Gerber and Tom Bradley at the TD Ameritrade Conference. I think Mr. Gerber may be correct in his assumptions for most industries, except ours. The reason quite frankly is what Mr. Bradley misses–simply calling yourself a fiduciary and making clients happy will in no manner ensure client‚s success.
The debate over who is a fiduciary and who is not should be evident by a process, not by mimicking the broker-dealer wirehouse rep model of smiling at your client while your hand is in their back pocket. Clients want a difference, but we do not deliver like we should. Mr. Gerber is right.
A process, in our case a fiduciary process (or what the medical community calls a standard of care), must be adopted. It cannot be built on wrap accounts, third-party due diligence or standard deviation as the measure of risk, but instead on a truly transparent, client-centered model. Fee-based does not equate to fiduciary. It is much more being able to justify the fee you are charging by your actions serving the client‚s interest.
Is the problem really the lack of a defined process or standard of care?
My firm clears through TD Ameritrade, and while I have issues with technology, it is the professionalism of the people who service my firm that keeps me waiting for this forthcoming VEO.

Brent E. Bentrim
Carolopolis Family Wealth Management
Charleston, S.C.

EDITOR‚s Response
There is nothing wrong with working IN a business and ON a business at the same time. Today, many financial advisors are doing both and enjoying great success.
Michael Gerber seemed awfully impressed with the fact that McDonald‚s Ray Kroc never flipped a hamburger or made and poured a milkshake. Personally, I‚d be a little reluctant to seek advice from a firm run by someone who had never met a real live client or written an actual financial plan, and then never implemented, monitored and adjusted it.
The Gerber-McDonald‚s process-and-systematize model works very well for large-scale, mass-market service businesses like Wal-Mart and Safeway. But Americans seeking financial independence want better, more personalized service.


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