Invest in support staff for a greater pay off.

It's ironic that financial planners can help others with long-term investing, yet may take a shortsighted view in how to invest in their own practices by hiring "warm bodies." These are people who do little more than answer the phone, open mail and process documents. Cost and immediate needs often dictate this decision.

However, cost and time are relative. Consider the cost of a tarnished reputation when repeated errors, missing paperwork and inefficient procedures result from the "warm bodies" approach. One bad support person can shut down the confidence earned over time with clients. Whatever qualities a financial planner stands for-excellent service, technical savvy, timely advice-should be represented in the support staff.

The cost trade-off for many practitioners is spending their own time to support clients. But when business picks up and paperwork bogs them down, there's no time to find the right person or train someone to continue the same level of service that clients have come to expect.

Cost and time are key factors when growth goals come into play. According to a 1999 practice survey by the CFP Board of Standards, one-third of participating CFPs responded that the size of their client base would increase over the next five years as the primary strategy for expansion. Nearly 20% intended to hire additional staff.

A Reason To Give Great Client Service

With expansion and client service as high priorities, how can financial advisors overcome the cost and time trade-offs when seeking support staff candidates?

Consider taking the long view by investing time up front to find someone who is not only interested in the financial services field but also has the potential to become a financial planner. Those with career aspirations will be motivated to learn the ropes and make the boss look good.

An individual's first financial planning job often is as a support-staff member because of the many barriers to entry in this highly regulated industry: cost, licenses and experience in the financial planning process. Yet if these barriers can be removed through creative investments of time and dollars, then a practitioner stands to gain a more valuable employee to help expand business.

Potential financial advisors have a reason to give great client service if they can earn a salary while learning the internal processes of the business. This can ease entry into a full-fledged planning career. Even if they discover that financial planning is not for them, then the practitioner may lose a protÈgÈ but gain an excellent financial analyst or loyal office manager.

From Warm Bodies To Problem Solvers

Finding someone with knowledge of the financial planning process and, if appropriate, the requisite securities and insurance licenses, will be well worth the time and effort. This can come from personal experience, professional associations such as the Financial Planning Association and colleges that offer financial services/planning programs. If potential job candidates have had prior internships or positions with financial services firms, they have been exposed to the needs-based approach-the concept of attracting and serving clients by determining their needs and following up with excellent service.

A college degree becomes more important if the firm's goal is to nurture support-staff members so they can become financial advisors. Those who hold finance and accounting degrees have a greater ability to read and analyze financial statements. Business and marketing coursework provide the knowledge for formulating a business plan and target market strategy. College sales courses can help with business development, including identifying client motivation, creating customer-focused solutions and using effective closing techniques. With this type of experience and education, it's possible to give job candidates a writing assignment to gauge their problem-solving and creative abilities.

Financial advisors can ask support-staff candidates to develop a plan targeting prospects. The candidates can start by interviewing a financial planner in the firm to learn networking techniques. The plan might require researching community resources for specific networking opportunities. Key steps include identifying referral sources, ways to establish relationships with them, forums for communicating with prospects and the types of advertising and marketing that would be most cost effective.

This activity also is an indicator of whether or not the person under consideration is able to distinguish between client interests and personal interests, which will speak volumes as to whether he or she will be able to act on the client's behalf.

No More "Dialing For Dollars"

An employee's ability to present the firm to prospective clients is important if the firm's goal includes client-base expansion. In the past, firms often looked for employees who could sell-those who had personal character traits such as friendliness, cunning and a highly polished presentation style. That approach often evokes negative connotations, such as low ethics and over-manipulation. During interviews with support candidates, it's important to discern if any misconceptions surface about not being "born to sell."

Due to the exploding information age, it is in the financial planner's best interests to hire staffers who will be savvier in understanding the customer and possess the right skills to create solutions to meet their needs.

This is why the common "dialing for dollars" practice among some financial planners is no longer effective in today's marketplace. This is when a new staff person is asked to solicit friends and relatives for business as a first sales responsibility. It's an uncomfortable feeling on both sides of the phone due to the personal nature of the profession.

What new support people need to learn is how to network effectively to make personal connections. That means going beyond chamber events and Rotary lunches to developing a professional communications approach. If the best referral sources for the practice come from estate attorneys, then support people need to know how to have a meaningful exchange when meeting lawyers in these situations and how to speak intelligently about the types of services offered by their firms' financial planners.

As a financial planner and teacher, I have found that role-playing is an important learning tool for networking and a needs-based approach with clients. For example, various scenarios can be set up to model how to draw people out and help new employees to practice introducing themselves and their firm. The idea is to assess verbal communication skills with the goal of encouraging consultative dialogue and building negotiation skills.

Technologies That Help

Most resumes will typically list technology skills, but it's how support people apply them that really counts for practice expansion. The most successful understand how to use the computer as a communications tool to respond to clients' current and future needs. College graduates with any technology credits can bring current expertise that may advance the practice far beyond what the senior planner has experienced.

Senior planners can help teach Internet research skills by exposing new staff members to various stages of the financial planning process and working with them to pull information that is used frequently, such as Morningstar ratings or to research articles for specific presentations. If done on a daily basis, their body of knowledge will grow steadily and all the nuances of the profession will become less overwhelming over time. (Or, senior planners may end up learning more Internet research skills from college graduates who have obtained these competencies.)

A practice can run more efficiently if the support person knows how to use either a simple database or customer relationship management program. These tools can not only track client projects for timing and content, but also keep important demographics, such as birthdays for dropping clients a card. Those who understand the needs-based approach also will know how to pull multiple attributes for targeting purposes. For example, by tracking client ages and family growth, computer-savvy staff can determine whom to invite to a college-planning seminar versus a long-term care seminar.

Although this selection and training process may take more time than merely advertising for a clerical person to push paper, the potential for gaining greater value is there by taking the long view. In the end, those with higher education and more experience will need to be paid more than "warm bodies." But practitioners can be creative in terms of offering flexible hours, internships or job-sharing with another planner so that the employee with higher potential can get a foot in the door.

Kathryn A. Gigler, CFP, also manages the financial services sales program at the College of St. Catherine in St. Paul, Minn. She can be reached at [email protected].