Regarding the client discovery process, will what works for doctors work for financial advisors? That’s what Halbert Hargrove Global Advisors LLC is trying to find out. The Long Beach, Calif.-based wealth advisory firm, which has more than $4 billion in assets under management, has signed up to test-drive an interview protocol commonly used in the health-care profession that a medical school professor is attempting to apply to the financial advisor profession.
Halbert Hargrove is the first RIA firm to test the SLCT (pronounced “select”) client discovery process developed by Jeff Belkora, an associate professor of surgery and health policy at the University of California in San Francisco. “SLCT” stands for “scribing, laddering, checking and triaging.”
Belkora’s premise is that discovering an individual’s agenda entails interviewing patients—or clients, in the case of advisors—to assess their interests, issues, concerns, questions, goals and priorities. The SLCT method aims to achieve this by scribing (asking open-ended questions and writing down a client’s top-of-the mind answers); laddering (asking clients to elaborate on their top-of-the-mind concerns); checking (using a checklist to relate some of the top-of-the-mind issues to stimulate additional client disclosures of importance to them); and triaging (creating a succinct, edited document summarizing the client’s agenda).
According to a Belkora-penned article in this summer’s edition of “The Journal of Wealth Management,” the SLCT methodology has been effective in a health-care setting by increasing patients’ disclosure of their questions and concerns, ultimately boosting their confidence and satisfaction levels while reducing their anxiety, distress and regret.
Global asset manager Russell Investments, which sees similarities in medical patient care and client service among financial advisors, partnered with Belkora on some initial exploratory research to see if it’s applicable to the advisor world. It later introduced Halbert Hargrove to Belkora. Halbert and Russell have a longstanding professional relationship going back to when the latter was known as the Frank Russell Co.
Halbert, a proactive firm that prides itself on staying on the industry’s cutting edge, welcomed the chance to be the first advisor firm to implement the SLCT protocol.
As part of the pilot program, Belkora evaluated the discovery practices of six Halbert advisors before and after training them in the SLCT process. That included observations, notes, transcripts and survey responses from interactions with the advisors and 18 simulated and 12 actual clients. According to Belkora, advisors increased the amount of questions asked during their dialogue with clients from 52% to 67%. Meanwhile, client disclosures rose from 57% to 68%, and the client’s rating of interviews on a 10-item survey jumped from 61% to 85%. In addition, SLCT was associated with improved client ratings of discovery interviews and improved advisor documentation.
Sounds great, but isn’t careful questioning during the client discovery process part of the Financial Advisor 101 textbook? “In some sense, it clearly is common sense, which turns out to be less common than is often supposed,” says Halbert president and chief operating officer JC Abusaid. “It is very difficult for an experienced person [i.e., an advisor] to not jump to conclusions—obvious to him or her—and begin providing solutions before completing a more thorough discovery.”
Abusaid said Halbert will expand its usage of the SLCT process as part of its team approach to client service, and will monitor its progress to ensure the process is adopted correctly.
“This is not an easy process to implement, as it takes quite a bit of focus and discipline to get the teams using it correctly,” he says.
RIA Firm Employs Health Care Technique For Client Discovery
June 1, 2015
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