Second in a two-part series.
Elite professional networks are composed of a handful of experts from such fields as law, accounting and wealth management. They work together to source the super-rich, and those of slightly lesser wealth, and to deliver their expertise to these clients.
Network members are motivated to work together because, by doing so, they can access more and wealthier clients. Some of these networks also transfer payments among its members. But the glue holding together professionals who are confident in their abilities-to put it mildly-is the access this team concept offers to the extremely wealthy.
Wise professionals recognize that being good, even great, is often not enough to access the super-rich. Being technically adept helps, but the ablility to connect and win over the extremely wealthy is often predicated on systematic marketing. Elite professional networks are clear examples of systematic marketing in action.
Over the years, I've run into these networks and consulted to a few of them. Because of their approach and capabilities, they've been very effective in both sourcing the super-rich and in delivering high-quality services to them. This, in turn, has proved quite profitable for network members.
Forming An Elite Professional Network
Elite professional networks aren't started overnight. To the dismay of more than a few professionals, there isn't anything resembling a directory or database of elite professional networks. Recruiters and the like are also useless. Rather, elite professional networks evolve from strategic professional partnerships.
If you want to source the wealthy, the optimal way is to establish strategic partnerships with influencers. These types of relationships spark the creation of elite professional networks.
It's important to note the difference between strategic alliances, which most professionals pursue, and strategic partnerships (Figure 1). Strategic alliances will usually yield some client referrals, but only sporadically. In a strategic partnership, the influencer will be providing you with a consistent stream of wealthy clients who need your expertise and are motivated to talk with you-and only with you.
FIG 1
Those with strategic alliances are often one of a number of similar professionals doing business with the influencer. In a strategic partnership, you are the exclusive or highly preferred professional and will receive the bulk if not all of the influencer's wealthy referrals.
As a strategic partner, the influencer is actively looking to refer wealthy clients to you. The same cannot be said for strategic alliances, where the influencer is not strongly inclined to make referrals to you.
The next step up the evolutionary ladder from a strategic partnership is an elite professional network. As professionals in a strategic partnership continue to work together, they reach a tipping point and recognize the benefits in working together in a more coordinated way, leading to the creation of an elite professional network.
The catalyst for this transition is when one of the professionals takes on the role of a "meta-facilitator." He or she approaches the strategic partners and gets everyone to agree to coordinate his or her activities for the benefit of everyone. This entails developing a solid understanding of the capabilities and expertise of each member. The elite professional network comes of age when members take steps to ensure super-rich clients are shared. This process can include the application of structured analytic processes and techniques such as the "Whole Client Model" and decision matrices.
Pooling Resources To Become Thought Leaders
A few things also happen when professionals transition from dealing with a few strategic partners to becoming a network. A significant change is when network members pool resources to develop thought-leadership products.
Being a thought leader provides an instrumental advantage in sourcing the super-rich. For example, being a thought leader is often critical to developing and leveraging a dual-impact brand (see In the Line of Money: Branding Yourself Strategically to the Financial Elite by Russ Alan Prince and Bruce H. Rogers, 2011). When you are recognized as the expert, the super-rich and influencers are more inclined to do business with you.
Many professionals are not thought leaders because they lack the knowledge and resources to become thought leaders. But there's a considerable amount of easily accessible information on how to become a thought leader. Hence, this need not be a major obstacle.
Developing and distributing high-caliber thought leadership products cannot be done on the cheap if you're interested in recruiting super-rich clients. On the contrary, when you want to engage the wealthiest people in the world, the thought leadership products must be exceptional. There's a lot of competition to becoming a thought leader, so the quality of the insights, processes and materials must be on the same ultra-high level as the professional expertise you can bring to the super-rich.
Elite financial networks have an edge over individual professionals when it comes to competing for the thought-leadership mantle. The resource requirements for becoming a thought leader geared to the super-rich can be considerable. By pooling the resources of its members, networks can bear the costs in time, effort and money. When executed well, this endeavor benefits each member of the network, which benefits the entire network.
The Future Of Elite Professional Networks
I know of 14 elite professional networks in the world. I've even done some consulting for a few of them, helping them develop high-caliber dual-impact brands and accompanying thought leadership products, improving the effectiveness of the network and the businesses of individual members, and acting as a value-added resource in the areas of family offices and personal wealth creation.
I strongly suspect there are a lot more networks that I'm not familiar with. Because they're informal, networks tend to form, last a period of time and then dissolve. The members go on to form other networks or just work with a number of strategic partners.
While the business model of elite professional networks can yield extraordinary profits, it's highly unlikely that this business model will become in any way normative. While it's certainly possible, if not advisable, for talented professionals to form elite professional networks, a lot has to do with chemistry among the members and finding the right group of like-minded professionals.
For the overwhelming majority of adept professionals, the best practices of elite professional networks can be very beneficial. For example, the ability to ensure the total return on each wealthy client is achieved would certainly benefit any professional. All professionals could also benefit from the concept of becoming a thought leader by pooling resources with other non-competing professionals and "sharing the stage." By adopting some of the strategies and tactics that make elite professional networks so effective, professionals can certainly improve their business success.