Inorganic Growth
Buying another advisory firm is also a way to increase assets, though it comes at the price of the firm you’re acquiring. That means you will have to take action to become more profitable. You might need to modify operations at the target firm to achieve cost savings. And once you’ve acquired those new clients, you’ll want to increase their value the same way you do with your current clients—by offering them more financial products and having the new clients act as your advocates. The acquired firm’s referral sources will also become yours and create a pipeline of new clients.
“Everyone Wins”
People take action only when it’s in their self-interest: To wit, accountants will only refer a wealthy client to you for investment management work when it’s in their interest. Attorneys want to work with you when you can help them locate more legal business among their own clients. When you can find that for them, they’ll be looking to you for your expertise more often.
That means, for better relationships, you need a deeper understanding of clients, colleagues and peers—not just the services they want, but the actual outcomes they want. When you help people achieve their self-interest, they’re more motivated to help you achieve yours.
This is what we call the “Everyone Wins” process. It’s never about selling—never—it’s about adding value. That’s not just a semantic point. It’s about the way you think and act, and if you do it right, it’s completely different from any sales system. Adding value means finding new ways to provide expertise (whether that’s with investment management or tax help or insurance).
Financial advisors who have embraced this process can achieve sensational results. They are able to regularly deliver considerably more value to their clients as well as help other professionals achieve greater success. And their clients regularly become their advocates. Also, such advisors will establish pipelines of new clients from accountants and attorneys. In fact, they are usually able to identify potential clients for their investment management services and other financial products in their very first meeting with an accountant or attorney.
2021 could be a truly exceptional year for increasing profits at your advisory practice. Whether the pandemic abates or not, whether the markets go up or down, whether some other calamity appears or not, you can make it a great year.
The key is your ability to optimize or enhance your relationships with clients, prospects, your team and other professionals. One of the most effective ways to do this is by looking deeper and finding ways that your expertise helps those around you.
Russ Alan Prince is president of R.A. Prince & Associates. Brett Van Bortel is director of consulting services for Invesco Consulting.