By the time you read this article, 2013 will be well under way. What kind of success do you have planned for 2013? How’s it going so far?
In order to be the highly successful financial advisor that you are capable of being, you must have good work habits.
This is crucial for several reasons. First, and foremost, it’s a trust issue. How can one person who doesn’t have their “stuff” together expect people to pay him/her to get their stuff together?
In other words, if you are sloppy and disorganized and if you spend too much of your time on low-payoff activities that are not moving you toward your goals, then why should clients trust you to help them get their finances organized and make the smart financial choices necessary to achieve their goals?
Being trustworthy is more than just being an honest person who isn’t going to steal a client’s money or give bad advice. In this article, we’ll explore some of the work habits of successful advisors as well as some of the work habits of not-so-successful advisors so you can have examples of what to emulate and what to avoid.
We will break this down into four key elements:
• Client service work habits.
• Client acquisition work habits.
• Leadership work habits.
• Time management work habits.
First of all, what is “success”? In my opinion, success is three things:
1. The value delivered for the client.
2. The financial success of the advisor.
3. The quality of life of the advisor.
Nos. 2 and 3 also benefit the client. They are not just about you. If you were a financially successful client, would you want to have a financially unsuccessful financial advisor? If you were a financially successful client, would you want to have a stressed out financial advisor who is living a crappy quality of life?
Being successful is a matter of integrity and good client service. You don’t have to be a rich financial advisor today whose quality of life is perfect in order to acquire and serve financially successful clients. However, if you’re not on the path of financial success and living a great life, you’re a fraud. People who give other people advice about their money and goals should also be financially successful people who achieve their goals. Make sense to you? If not, read no further.
Client Service Work Habits
1. Successful advisors spend their time with clients who are profitable.
Unsuccessful advisors work with too many people who are not profitable and probably don’t even know how much revenue a client must generate in order to be profitable in the first place. They say, “I know we’re losing money on each of these clients. We’ll make it up with volume.”
2. Successful advisors are either truly comprehensive or, at the very least, do much more than most financial advisors. It’s interesting how many financial advisors do exactly the same thing as pretty much the rest of the financial advisor world but claim to be “different.” The most successful financial advisors have a value proposition that is driven by their knowledge of what is best for the client, rather than by what the client is willing to buy.
Unsuccessful advisors will pretty much sell anything to anybody anytime. Whatever the client is willing to buy is what they are going to sell. They are not really “advisors” at all. They are salespeople.
3. Successful advisors serve a finite number of clients who pay them a predictable amount of recurring revenue. They are not only clear about how much money each client must generate, they also know how much time to budget per client in order to serve the client and be profitable.
Unsuccessful advisors have little clue how much time to budget to serve a client. They tend to rationalize this with silly statements like, “Every client is different, so it’s impossible to know how much time it’s going to take to serve them.”
4. Successful advisors are orchestrating a systematic process for delivering the promised value for each client.
Unsuccessful advisors struggle to do the best they can with what they’ve got on an ad hoc basis.
5. Successful advisors are excellent at helping clients manage their emotions about external events. Regardless of what’s happening in the markets, the economy, politics or world events, the successful advisor is able to keep her clients focused on what they can control and stick to the plan. There is no time or energy wasted writing market or economic updates or reacting to the ever-present uncontrollable events.
Unsuccessful advisors are whipped around by the clients’ emotional responses to the negative news about the market or the economy or politics or world events. They churn out long written explanations about the fiscal cliff or the debt ceiling or what happens depending on this or that political event/election or what happens if one European nation or another defaults on its debt. And many of their discussions with their clients center on these events over which there is no control. The downside, of course, is that these activities are an enormous waste of time. This is time that could have been invested in acquiring another ideal client or enjoying life or making a difference.
Client Acquisition Work Habits
1. Successful advisors build their business by referrals and introductions.
Unsuccessful advisors typically deploy multiple time-consuming and expensive marketing tactics, usually mastering none of them and ultimately investing large sums of money that produce very small results. Or they never do much of anything to acquire clients because they can never afford to.
2. Successful advisors are very good on the phone and use some of their client acquisition time to connect with people they have been referred to by calling them. Because they have excellent people skills and are eager to engage people face-to-face. While some people tend to be more “outgoing” than others, successful advisors have consciously developed their people skills.
Unsuccessful advisors seem to be afraid of people and tend to do just about anything other than talk to another human being. They are often “wrapped around the axle” trying to get people to call them by building the perfect Web site or deploying the fantasy social media plan.
3. Successful advisors ask really good questions, are excellent listeners, truly empathize with people and, when it’s their turn to talk, are very effective at articulating how their process will help the prospective client achieve meaningful results in their life.
Unsuccessful advisors tend to talk about the features of their products, the markets, investment performance, why their company is great, etc.
Leadership Work Habits
1. Successful advisors recognize that everything they do is about leadership, especially their client service work. They lead their clients by understanding exactly where the client wants to be (also, when and why), and then they lead the client with great advice and accountability to get there.
Unsuccessful advisors tend to be subservient to their client and have an upside-down accountability relationship where the client is holding them accountable instead of the other way around.
2. Successful advisors lead and give advice. They are not educators, therapists or salespeople. They tell the client what he needs to hear, not necessarily what he wants to hear, even if it means risking the relationship.
Unsuccessful advisors tend to do just about anything but lead and advise. Instead, they justify wasting the client’s time by educating him so he can “make his own decision” or they take the sales approach and present options so “the client can make his own decision.” This is not leadership.
3. Successful advisors lead the team of other subject matter experts to do the best possible job for the clients. They are the point people who make sure the accountants, the money managers, the financial planners, the lawyers, the insurance agents, the bankers, etc. are all doing the job they are supposed to do to contribute to the clients’ financial success. When all these professionals are in the same room together, it’s obvious that the advisor is in charge.
If the unsuccessful advisor is even in the same room with the accountants, the lawyers, the money managers, the financial planners, the insurance agents, the bankers, etc., he is just another player on the team and not the “head coach.” If your client ever checks your advice with someone else, then you know you’re not the leader.
Time Management Work Habits
1. The successful advisor spends most of his or her time engaged in productive client service, client acquisition and leadership activities. Until your ideal client community is complete, you can expect to invest at least eight hours per week in direct client acquisition work.
Unsuccessful advisors tend to “study” much more than is necessary. They study the markets, economics, politics and world events as if they can somehow predict what’s going to happen and capitalize on it. They tend to spend less than two hours per week in anything that could remotely be considered serious client acquisition work.
2. Successful advisors are good delegators, especially when it comes to the administrative elements of running their businesses.
Unsuccessful advisors seem to never have enough time to go get more ideal clients because they are stuck in the minutiae of running their businesses. As the saying goes, if you don’t have an assistant, you are one.
3. Successful advisors also delegate and outsource to highly qualified technical subject matter experts rather than trying to maintain an expertise in everything, including financial planning, investments, insurance, taxes, law, etc. They have a good fundamental understanding and they make sure things get done rather than feeling like they have to do things all by themselves.
Unsuccessful advisors tend to act as if they have to know everything themselves. They are trapped by the illusion that one person can be an expert in all the areas of finance necessary to help their clients make smart choices about their money.
Of course, it’s impossible to cover every element that distinguishes the successful advisor from the unsuccessful advisor in a short article. However, if you shift your behavior and habits to fall on the successful side of the habits ledger outlined in this article, you will tap more of your true potential. Your clients win and you win.
Bill Bachrach is considered to be our industry’s leading authority on the subject of building high-trust client relationships. To learn more about how his company can help you create your Ideal Life by building an Ideal Business exclusively with Ideal Clients, go to www.billbachrach.com.