(Dow Jones) Investors may be calmer now than they were a year ago, but many got used to the extra hand-holding their advisors provided in the financial crisis. And they don't want it to stop.
That's a challenge for financial advisors. "How do we service clients and still find a way to carry on our day-to-day business?" John Smith, a certified financial planner in Itasca, Ill., sums it up.
About six in 10 financial advisors who participated in a Russell Investments survey said client demand for their time has increased in the past two years. Two in ten said demand has decreased, while the rest reported no change.
Smith's firm, Balasa Dinverno Foltz LLC, like many wealth management firms, groups clients based on asset levels or other factors and tailors its service offering accordingly. The idea is to spend the most time with the biggest clients or those who are steady referral sources.
The firm recently went a step farther and divided its ten wealth advisors (total employee count is approximately 30) into relationship managers focused on serving clients and business developers, who work with fewer clients and bring in new ones.
More clearly delineating responsibilities and aligning them with financial advisors' skills and personalities is meant to keep advisors focused on what they do best and ensure clients are well-served, Smith says. Satisfied clients are more likely to turn over additional assets and refer new business.
Mark Dietz, a CFP in Centennial, Colo., relies heavily on technology to provide efficiencies, including updating client account information and issuing reminders as clients approach Social Security age or face required minimum distributions from retirement accounts.
Introducing technology that allows clients to review all their accounts online, including those not held by his firm, has had a calming effect on clients, Dietz says. Rather than obsessing over their daily account balances, clients are reassured when they log in from home or work that news or market events haven't decimated their portfolios.
He suggests financial advisors spend twice as much time on their "service model" than they do their "business model." Many advisors are skilled at attracting clients, "but their failure to communicate effectively through a well-defined service model will drive clients out the door much faster," Dietz says.
PNC Financial Services Group Inc.'s wealth-management business uses a combination of mailings and phone calls to convey its focus on clients, says Michael Saghy, market investment director in Pittsburgh.